Three U.S. Bank executives held a LinkedIn Live discussion on Black Americans, intergenerational wealth, and the historical discriminatory policies that have prevented Black people from building wealth.
The discussion, held earlier this month, featured U.S. Bank Head of Affluent Wealth Management Scott Ford, Head of Branch and Small Business Banking Sekou Kaalund, and Chief Diversity Officer Greg Cunningham. During the discussion, the three Black executives discussed the barriers that have kept Black men and women from building intergenerational wealth and the progress made in recent years to reverse the trend and reduce the racial wealth gap.
During the discussion, the executives brought up the U.S. Bank Building Black Wealth Insights Study, which stated that 79% of Black Americans believe institutional roadblocks kept them from accumulating wealth. The study also revealed that 69% of Black Americans felt a deep sense of responsibility to help their communities financially and are committed to leaving a financial legacy for the next generation, and it wasn’t the only revelation.
“The study revealed an eight-to-one wealth disparity between white households and Black households in terms of overall wealth,” Cunningham said. “Forty-five percent of Black households own
their own home vs. 74% of white households. We all know how important homeownership is. It’s the No. 1 way that wealth gets transferred in this country. These are big and important problems.”Ford agreed, adding “a home is the most valuable asset families have” and that a “lack of access to homeownership is one of the things that precipitated the wealth gap to begin with.”
According to the National Association of Realtors (NAR), 44% of Black Americans are homeowners, a 0.4% increase in the last decade. In comparison, 72.7% of white Americans are homeowners.
The group also discussed the struggle to access capital for Black entrepreneurs and small business owners. According to Ford, a lack of capital not only hurts business owners but Black communities as well.
“The vast majority of all job creation is in companies with less than 100 employees,” Ford said in the discussion. “The median net worth for Black business owners is 12 times higher than for the rest of the general Black population. Small businesses are key contributors to the stability of our communities and the ability to create intergenerational wealth.”
To help, the bank has introduced its Business Diversity Lending Program, which provides credit and financing to help women, minority, and veteran-owned businesses grow and thrive.
“Through the program, women-, minority- and veteran-owned businesses are eligible for reduced credit score and decreased cash flow coverage requirements on most conventional lending products up to $2.5 million,” Head of Business Segment Strategy Coordination & Support at U.S. Bank Mary Miklethun said in a statement.
Despite the challenges for Black Americans, the executives added they are optimistic about the future when it comes to Black Americans building wealth.