African American financial institutions are banking on you.
Popular syndicated radio talk show host Warren Ballentine recently teamed up with the National Bankers Association, the Washington, D. C.-based consortium of minority-owned financial institutions, to unveil “The People’s Economic Movement,†a program designed to encourage African American individuals and institutions to deposit dollars in Black banks. The initiative’s supporters, among others, include National Urban League President Marc Morial, NAACP head Benjamin Jealous and National Action Network President Rev. Al Sharpton.
Ballentine firmly believes Black institutions and consumers will recover from the Great Recession by pooling resources and strategically leveraging our buying power . “We don’t want to create a minute. We want to create a movement,†Ballentine told me earlier this week. “We’re asking everyone to get involved.†The call to action has been gaining traction as organizations like the Atlanta Association of Black Journalists have decided to transfer funds to local Black institutions.
Says NBA President Michael Grant: “This program will enable Black banks to shore
up their capital base, and they will get a chance to invest in communities by lending money to businesses and, in turn, create jobs,” he maintains. “We’re developing a model for economic development.â€This initiative was an outgrowth of a grassroots “Community Reinvestment” campaign Ballentine launched with Kim Saunders, CEO of Durham, North Carolina-based M&F Bank (No. 9 on the BE BANKS
list with $312 million in assets) some 14 months ago as a means to attract customers to that institution. It proved to be a smashing success: After promoting the effort on his Truthfighters radio program, listeners deposited more than $500,000 in less than two months. By the end of the campaign, M&F garnered over $1 million in deposits. The institution decided to match that sum and launch a $2 million fund to provide loans for area businesses and community members. “You can say that Warren’s initial efforts became a test for us,†says Grant. “When he met with a group of our members’ banks about a broader initiative, they loved the idea.†Ballentine plans to report on the campaign’s progress during the unveiling of the Dr. Martin Luther King Jr. memorial statue in Washington, D.C., on Aug. 28, 2011.Point blank: We must do everything in our power to preserve our most valued institutions. Since the establishment of the first bank organized and operated by African Americans in 1888–Washington, D. C.’s Capital Savings, which was supported by Black community members with meager resources who proudly made deposits until assets grew to $300,000 in just four years–our institutions have always been a source of financing for entrepreneurs, home buyers and college-bound students during decades when majority institutions refused to even acknowledge our presence. To this day, they represent financial mainstays in Black communities. Now, Black banks need fresh sources of capital, especially at a time when a number are still reeling from heavy loan losses during the economic downturn and must now contend with stringent capital requirements and overzealous bank regulators. Over the past year, five Black banks have been forced to shutter operations
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As part of my weekly segment on Truthfighters Show, Ballentine and I have often talked about how we must embrace collective economics to advance financial and business agendas. That means we must apply our resources and clout to create commercial partnerships, expand investment pools and engage in selective consumerism. Simply put, do business with each other. A long-time proponent of Black-on-Black capitalism, Ballentine has effectively used his radio program to promote the purchase of subscriptions to Black publications, including Black Enterprise, as well as the development of a fund to help capitalize Black ventures.
Ballentine’s not alone in his activism. Over the past few years, John and Maggie Anderson have been spreading their “buy Black” gospel as founders of The Empowerment Experiment. They were driven, in part, by the fact that dollars of African American consumers left our communities after a mere six hours while bucks in Asian,
Jewish, and Latino communities were recycled back into their neighborhoods as long as 29 days in some cases. During 2009, the couple spent the full calendar year committed to only making purchases of products and services from Black-owned companies. In fact, they also switched to a Black-owned financial institution during this period and even tried to transfer student loan debt to an African American creditor. When blackenterprise.com reported on the status of the Andersons several months ago during Christmas holiday season, they were still actively patronizing and researching Black businesses and continue to do so to this day.Such recent developments have been at the core of BLACK ENTERPRISE‘s mission and reflected in our Wealth For Life principle No. 8: I will support the creation and growth of minority-owned businesses. So if quality Black businesses are to grow and expand, you must play your part. Start by opening an account at your local Black bank.