Bank of America said it completed seven investments in minority depository institutions (MDIs) and community development financial institutions (CDFIs) on Monday, part of the bank's $1 billion, four-year commitment to advance racial equality and economic opportunity in the U.S.
The bank said it acquired approximately 4.9% of common equity in each organization, which includes: CSB&T Bancorp, First Independence, Liberty Financial Services, M&F Bancorp, SCCB Financial, Southern Bancorp and Unity National Bank of Houston.
- The investments, which are part of a $50 million commitment to MDIs and CDFIs, will go toward investments in the communities the institutions serve through lending, housing, neighborhood revitalization and other banking services, the bank said.
Bank of America's recent investment follows up on a promise to combat racial inequality made by CEO Brian Moynihan in June.
"Our management team, our market presidents and market executives, leaders of our company at every level, all of us — all of you — can and will do more," Moynihan said in response to the deaths of Ahmaud Arbery, George Floyd and Breonna Taylor in an internal memo seen by the Charlotte Business Journal.
The country's second-largest bank first announced its $1 billion commitment in June, a pledge aimed at fighting racial disparity related to the coronavirus pandemic.
In September, the company said it would direct one-third, or $300 million, of the $1 billion commitment to four areas, including $25 million in support of jobs initiatives in Black and Hispanic and Latino communities; $25 million in support of community outreach and initiatives; $200 million in proprietary equity investments in minority entrepreneurs, businesses and funds; as well as the $50 million set aside for MDIs and CDFIs.
"We are pleased to provide equity capital to these institutions so they can continue to serve their communities well. We expect to complete more of these investments over time," Moynihan said in a statement.
Bank of America is one of a growing number of financial institutions and major corporations pledging funds to combat racial injustice as well as the economic and racial inequality exacerbated by the coronavirus pandemic.
In June, U.S. Bank pledged to boost loans to Black-owned businesses by $100 million. The company also promised to establish a $15 million fund to award community grants to organizations dedicated to addressing economic and racial inequality.
In the same month, PayPal pledged $530 million to support businesses owned by Blacks and other nonwhites, while PNC committed more than $1 billion toward community development financing and capital for neighborhood revitalization and small businesses, among other efforts, to fight systemic racism.