Strengthening Support for Black-Owned Banks

Investments in Black-owned financial institutions help reduce racial disparities and improve prospects of underbanked communities

In a recent bylined article in Independent Banker magazine, the president of the country’s second-oldest African American-owned bank underscores just how essential banking diversity is for U.S. financial services. “Black-owned community banks have a long history of serving Americans historically left out of the mainstream banking system,” says James Sills, president and CEO of M&F Bank. “Many well-established community banks continue this legacy today, but one troubling trend has emerged in the past two decades: The number of Black-owned banks is steadily declining.”

James Sills, president and CEO of M&F Bank, the country’s second-oldest African American-owned bank. Photo by Mehmet Demirci in Independent Banker, February 1, 2022

Even as #bankblack movement endures and capital investments increase for minority depository institutions (MDIs) and community development financial institutions (CDFIs), banks that serve communities of color are still striving to do more in a challenging environment. “Black banks are always going to have a need to raise more capital because we just don’t have access to public markets the way majority banks have,” says B. Doyle Mitchell, president and CEO at D.C.-based Industrial Bank, in Black Enterprise. “These investments will get us to a certain size.” But it’s their service to the community that demonstrates their true power.

While it’s certainly true that many communities remain underbanked and much more needs to be done to ensure access to banking, what sometimes gets lost in the discussion is the achievements minority institutions help manifest. “After a long history of systemic economic oppression, Black-owned banks are playing a key role in improving the economic fortunes of their communities,” according to an article exploring Black-owned banks’ impact. “It’s important for us, not just the Black community, but for everyone, for America to know that we’ve come a long way in a short period of time,” says Teri Williams, president and COO, OneUnited Bank.

In an upcoming article in Believe in Banking news, we will provide an update on the role of fintechs in serving underbanked communities, along with diversity-based staffing initiatives on both the banking services and the regulatory side of financial services. For the latest data, news and trends in financial services, like black banking, stay tuned to Believe in Banking. For insights on meeting consumers at the point of need, contact Adrenaline’s banking and credit union experts at