In recent months, we’ve seen countless corporate moves aimed at fixing the intractable racial inequities in the U.S.
Companies have held town hall sessions for employees, created diversity and inclusion committees and hired C-suite officers focused on diversity.
But one tangible move that companies can make doesn’t even have to cost anything — it’s as simple as money in the bank.
In recent weeks, Detroit-based First Independence Bank — the state’s largest Black-owned bank — has received attention and financial support from far bigger bank competitors.
It’s received an investment from a banking goliath, Bank of America Inc., which took a 5 percent stake in the bank. But another move, by Comerica Inc., is one that can be replicated by any company.
Comerica is making a $10 million move to inject capital into Black-owned banks, including $2.5 million to First Independence.
What’s that capital? It’s essentially a deposit. And deposits are what allows banks to lend money out — to consumers, and to businesses. That suggests a path for other companies, who have to keep their money somewhere, to make a difference in Black communities.
First Independence is not a big bank. It’s just outside the 50 largest in the state, according to Crain’s data. Significant deposits by just a few companies would make a meaningful difference in its ability to lend and help capital flow to the communities where it does business.
Banks typically loan out 80 percent to 90 percent of their deposits. If 10 large companies each deposited $10 million, that’s $80 million to $90 million in loans that a bank like First Independence could make that it couldn’t before.
Black-owned banks write more mortgages for Black homeowners, provide a larger share of support for Black small businesses. The more money that flows, the greater the opportunities for building wealth among African Americans.
Moving the needle on racial injustice has become an imperative for corporate America. Where companies stash their cash does make a difference.
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