In an exciting development in the world of finance, two of the country’s leading Black-owned banks — City First Bank and Broadway Financial Corp. — have finalized efforts to merge as City First Broadway. The newly merged bank will have more than $1 billion in combined assets and will now become the largest Black-owned minority depository institution (MDI) in the United States.
Tasha Taylor of The Source has reported that while there are currently 143 existing MDIs in the U.S., just 20 of them are led by Black CEOs. City First Broadway will be led by two of those executives: Brian E. Argrett of City First and Wayne-Kent A. Bradshaw of Broadway Financial Corp.
Citing a study from the Federal Deposit Insurance Corporation, Taylor reported that maintaining a strong network of MDIs is essential today because “such minority-led institutions outperformed traditional banks in originating mortgages and federally backed small-business loans to borrowers in low- and moderate-income census tracts.”
Taylor also noted that MDIs “often function as a channel to poverty-stricken neighborhoods, providing low-cost loans and access to capital that wouldn’t typically be available.”
City First Bank and Broadway Financial Corp. are considered by many to be a perfect fit to join forces as one organization since they both share a “common mission, values and vision for providing capital to underserved communities.”
In a September 2020 interview with The Grio, Argrett said, “we have all seen the compounding impacts from centuries of racial inequities in this country — social unrest, higher unemployment, poverty. Economic injustice is at the root of racial injustice. That’s why the work of MDIs and community deposit financial institutions are more important than ever; they are squarely focused on these inequities like getting capital to those who truly need it.”
According to Taylor, the newly formed City First Broadway will focus on three primary areas of financing: multifamily-affordable housing, small businesses and nonprofit development — all of which Argrett says are essential for the continuing success and prosperity of many lower-income families, including many people of color.
“We need to scale up our impact. Having a larger capital base is important so we can direct more resources into underserved communities,” Argrett said in an interview with Taylor. “This is about creating a national platform where we can scale our solutions to help with these problems impacting these communities.”