Bank of America (NYSE:BAC) on Monday announced it is plowing fresh equity investments into three lenders that concentrate on services for minority groups. These investments give it stakes of nearly 5% apiece in small banks Carver Bancorp, Carver Financial, and CNB Bancorp.
These moves are part of a wider initiative Bank of America launched in June: a four-year, $1 billion program aimed at boosting racial equality and opportunity for members of minority groups. Of this, $50 million has been earmarked to financially support minority depository institutions (MDIs) and community development financial institution (CDFI) lenders.
The three investments announced Monday bring Bank of America's total to 10 under the program. Other recipients include M&F Bancorp, Unity National Bank of Houston, First Independence Corporation, and CSB&T Bancorp, the parent company of Citizens Savings Bank and Trust.
Bank of America quoted its CEO Brian Moynihan as saying of its project: "By providing equity capital to minority depository institutions, critical projects can be scaled. MDIs are closely connected to the needs of their communities, and these investments will help transform and enable more positive change and economic opportunity."
The bank didn't hesitate to mention that in addition to the direct investments, it has also provided $100 million in deposits to MDIs and operates a CDFI portfolio valued at $1.6 billion, involving 255 partner CDFIs throughout the country. These institutions provide "access to capital to thousands of individuals and small businesses who do not qualify through traditional lenders," according to Bank of America's announcement.