By: Ken Chase.
Bank of America has confirmed that it plans to add an additional $100 million in deposits to banks serving minority communities, as part of its broader effort to support racial equality initiatives. The bank had previously committed to investing $100 million in deposits for minority depository institutions (MDIs), so the new pledge doubles that investment.
According to reports, the promised deposits will enhance those smaller banks’ ability to offer home and business loans to their communities, providing needed capital for many minority communities across the United States. BoA chief administrative officer D. Steve Boland suggested that the impacted banks will likely see between $1 and $10 million in deposits each.
Reuters reports that those banks will include City First Bank, Southern Bancorp, and other unnamed MDIs.
In a press release announcing the new commitment, Boland noted that:
“It is well recognized that MDIs are a critical resource to minority and underserved communities by providing banking services, creating jobs and helping businesses grow. As a founding member of the Economic Opportunity Coalition, we are committed to finding innovative ways to scale and expand the reach of our capital to provide access to economic opportunities and support diverse communities across the country.”
The new pledge means that Bank of America has now committed to more than half a billion dollars of new investment in capital for minorities and women in recent years. The bank had previously committed to providing $350 million of capital to female and minority business owners and entrepreneurs. According to the company’s press release, that investment is just part of the bank’s broader “$2 billion portfolio of loans, deposits and investments in Community Development Financial Institutions (CDFIs) and MDIs.”