Agility Bank, a digitally focused women-owned and women-run commercial community bank, will officially open next week, after receiving approval from the Office of the Comptroller of the Currency (OCC) to operate as a minority depository institution (MDI), the Houston-based bank announced Wednesday.
Agility’s journey to operate as a nationally chartered institution was two years in the making. The de novo filed paperwork with the FDIC in April 2020, with initial plans to open by the end of that year, but the pandemic altered the bank’s opening timeline, said Lauren Sparks, Agility’s founder, president and CEO.
“The regulators in particular weren't quite sure about moving forward with a new bank,” Sparks said. “And so we had to really shock our plans and make them much more geared towards a very low-growth environment.”
The bank received conditional approval from the OCC and the Federal Deposit Insurance Corp. (FDIC) last year, but faced additional challenges hitting its $30 million capital raise requirement.
“It was a very difficult time during the pandemic to speak to people about financial matters and help them understand that there was still a great business opportunity on the other side of all of that,” Sparks said. “We were able to keep talking about all the great business opportunities that we knew were ahead, but not everybody had the same frame of reference when we were speaking to them about investment.”
The bank has since overcome its fundraising hurdle and will open with $35 million in capital, surpassing its $30 million requirement.
Agility’s mission is to promote financial parity for women and boasts a diverse leadership structure – a requirement of MDIs.
Agility’s board is 75% minority and 54% of its ownership is minority.
“That was another hurdle,” Sparks said of the ownership requirement to receive MDI status. “More than 51% of our shareholders needed to be female, and it's not a conversation that most female investors have had, in terms of investing in a bank. ... But at the end of the day we ended up with a really great grassroots shareholder base.”
The bank’s ownership structure also leans local, with more than 85% of Agility's shareholders Houstonians.
Sparks said she views the Houston market as a great opportunity for a de novo like Agility.
She told Banking Dive in 2020 the city is in need of fresh bank entrants, adding the area has seen a number of its community banks scooped up by larger firms after Hurricane Harvey hit in 2017.
Even in the midst of the pandemic, the market has performed well, Sparks said.
“There's still growth, there's still new businesses, and there's still existing businesses expanding,” she said. “There are people moving here every day. And our growth projections for Texas and for Houston continue to be very exciting for us as a new bank in the market.”
Sparks said Agility is only the second de novo since 2008 to open in the Houston area.
“I'm sure there'll be some behind us,” she said. “It's just a great place to be. If you want to be a de novo bank, you want to be in Texas, and you especially want to be in Houston.”
The bank claims it is the first MDI established with the purpose of supporting women as well as all small and mid-size business owners.
“We started from the very beginning saying we want to be a women-owned, women-led bank because that sets the tone and provides a perspective for who we are,” Sparks said. “There's obviously a need for women to be at the table in all major parts of business and finance. Being at the table in terms of finance and access to capital is really the great equalizer. And it has to happen somewhere. I'm actually excited that it happened in the middle of the country and in Texas, where people sometimes think of it as a more conservative environment. But there's a need to be doing good business with men and women and we're setting the precedent."