Back on March 10th of 2020, Wells Fargo & Company made a pledge to invest up to $50 million into banks owned by African-Americans in the United States. As part of that standing commitment Wells Fargo invested into five additional African American Minority Depository Institutions (MDIs) all over the country, bringing their current total of investments into MDIs to 11.
The five institutions recently receiving investments are:
- Unity National Bank from Houston, Texas
- Liberty Bank from New Orleans, Louisiana
- First Independence Bank from Detroit, Michigan
- Citizens Trust Bank from Atlanta, Georgia
- Carver State Bank from Savannah, Georgia
Wells Fargo’s financial commitment to these MDIs comes as critical equity capital, allowing these banks to maintain their status as MDIs. The Bank’s support also includes a banking relationship with each investment recipient and a single touchpoint granting the MDI access to Wells Fargo’s expertise. This system also grants them the power to pursue strategic priorities like hiring staff, designing products, and entering new markets.
“The country’s MDIs are vital to minority communities, but over the last two decades, many have declined or have closed. The capital investment we are announcing is important, but it’s our relationship approach that will make the difference in their futures,” said Wells Fargo’s vice chairman of Public Affairs William Daley. “We want to be a partner to these important institutions and, in turn, have a positive effect on local communities.”
Wells Fargo is able to make such commitments by having in place external partners. For this series of investments those partners included: the National Bankers Association and Sullivan & Cromwell and external advisory committee members: 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.
Some of Wells Fargo prior initiatives supporting minorities and their communities include:
- A $5.4 million in grants given to 15 legal assistance organizations across the U.S. that work to keep people and families housed through services and advocacy efforts.
- The company pledged in 2017 to create 250,000 Black homeowners by 2027 by lending $60 billion for home purchases, increasing the diversity of the sales team, and supporting homebuyer education and counseling,
- From 2009 to 2018, Wells Fargo was No.1 in financing home loans to African Americans, originating more mortgages to help Black home buyers purchase homes than the four other largest bank lenders combined, and
- The Open for Business Fund donates all gross processing fees the Bank received from the Paycheck Protection Program in 2020 — approximately $420 million — to nonprofits helping small businesses navigate the pandemic, with an emphasis on small businesses owned by Black, African American, and other small business owners of color.
