S. E. Williams | Black Voice News
Wells Fargo & Company has finalized investments in two African American Minority Depository Institutions (MDIs)–the Harbor Bank of Maryland and Industrial Bank of Washington, D.C.
By making these last two equity capital investments, the company has now invested 13 such institutions fulfilling its March 10, 2020, announcement to commit $50 million to Black-owned banks in communities across the country including City First Bank, in Los Angeles.
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“We are a proud partner to all these banks as each serves as a cornerstone to the communities they serve,” said Gigi Dixon, head of External Engagement for Diverse Segments, Representation and Inclusion at Wells Fargo.
Additional Program Benefits
“The way we’ve structured this program goes beyond a simple capital investment; we’ve worked to understand these MDIs, their needs, their strategic aspirations, and their challenges. We want to help them grow so they can continue to be important drivers of economic vitality for years to come.”
As part of the investment, Wells Fargo is offering access to a dedicated relationship team that can work with each MDI on financial, technological, and product development strategies to help each institution strengthen and grow. In addition, Wells Fargo will be making its nationwide ATM network available for customers of these 13 MDIs to use without incurring fees.
“Honoring our 86+ year commitment of educating and helping our communities build generational wealth, Industrial Bank is excited to partner with Wells Fargo in expanding these efforts,” said B. Doyle Mitchell, Jr., president and CEO of Industrial Bank. “Being one of only 20 African American banks in the country, this partnership will enhance our ability to grow and create more opportunities to provide capital to those communities we support. We appreciate Wells Fargo for its commitment to invest in minority institutions and partnering to alleviate the negative impact of financial inequalities on communities of color and closing the racial wealth gap.”
The structure of Wells Fargo’s investment is in the form of critical equity capital, which is foundational to the MDIs’ ability to expand lending and deposit-taking capacity in their communities. The investments, primarily non-voting positions, are designed to enable the banks to maintain their MDI status.
Wells Fargo is also supporting each MDI’s development through a banking relationship in the form of a single touchpoint coverage model that will help them access Wells Fargo’s expertise and pursue strategic priorities like entering new markets, expanding locations, designing new products, and hiring staff to support loan growth.
External partners that assisted Wells Fargo include the National Bankers Association and Sullivan & Cromwell. External advisory committee members are Kim D. Saunders, president and CEO of NBA; Aron Betru, managing director of the Center for Financial Markets at Milken Institute; and John W. Rogers Jr., chairman, co-CEO, and CIO of Ariel Investments.
S. E. Williams is executive editor of the IE Voice and Black Voice News.