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As Black-Owned Banks Withdraw, Community Sounds Alarm - WSJ
By Sharon Nunn
Aug. 6, 2017

The number of black-owned banks operating in the U.S. has been dropping steadily for the past 15 years and fell to 23 this year, the lowest level in recent history, according to the Federal Deposit Insurance Corp. That has left many African-American communities short of access to capital and traditional financial services, according to some banking experts....The 2008 recession hit the black banking sector especially hard, and if the current rate of closures of about two a year, as well as the industry-wide reluctance or inability to start banks, continues, black-owned banks could disappear entirely within the next eight to 12 years. The trend is worrisome to some analysts who argue fewer banks serving low-income, minority groups could expand “financial deserts”—communities with few or no banking institutions—and increase the likelihood that black and Hispanic communities could become susceptible to redlining, a discriminatory practice that excludes poorer minority areas from financial services....... [black-owned community banks were] the first bank some African-Americans had access to, making it a symbol of black enterprise and economic development, .......A survey of entrepreneurs by the U.S. Census Bureau in 2014 found that 47% of black business owners had gotten got the full amount of funding requested from banks, credit unions or other financial institutions, compared with 76% of whites.

That survey also showed fear of rejection was the top reason cited by black business owners who chose not to seek needed capital at all.
black-owned  banks  African-Americans  trends  decline  FDIC  financial_services  redlining  low-income  community_banks 
august 2017 by jerryking
The FDIC's Sheila Bair: Going bare-knuckled against Wall Street - The Globe and Mail
Jun. 22 2013 | The Globe and Mail | KEVIN CARMICHAEL.

Deposit insurance agencies are vital to the smooth functioning of the financial system. Without them, banks would face cascading withdrawals at the first whisper of trouble. Yet within the constellation of financial regulators, deposit insurance agencies are more like Mars or Venus, dominated by the Jupiter-like presences of the finance ministries, central banks and securities commissions....Sherrod Brown and David Vitter, Democratic and Republican senators respectively, have co-sponsored legislation that would force the biggest banks to hold equity equal to 15 per cent of assets, which is much more onerous than current law. An idea that Ms. Bair long has advocated as a way to make the biggest banks less risky – forcing them to hold higher levels of long-term debt – is catching on with policy makers.....How did it get so bad? Ms. Bair has a theory. Over eggs and oatmeal in December, she explained what it was like to be on Capitol Hill in the 1980s, when Ronald Reagan and Tip O’Neill, the Democratic speaker of the House of Representatives, made an agreement to overhaul the tax code. That generation of leaders was influenced by the Second World War; many had fought in it. Such experience teaches you to “put country first,” Ms. Bair says. “We’re the pampered Baby Boom generation. We’re not willing to make the sacrifices as much as our parents were.”
too_big_to_fail  FDIC  financial_system  Sheila_Bair  profile  women  Wall_Street  WWII  the_Greatest_Generation  regulators  sacrifice  baby_boomers  Kevin_Carmichael  shared_experiences  shared_consciousness  policymaking  tax_codes 
june 2013 by jerryking

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