NEW YORK, Oct 4 (Reuters) – Financial institution of America Corp plans to deposit a further $100 million into banks that concentrate on minority communities, the corporate mentioned on Tuesday.
This system doubles Financial institution of America’s earlier pledge to deposit $100 million in minority depository establishments, or MDIs, which are largely owned by minority people. The second-biggest U.S. lender has expanded its racial equality initiatives lately, making $42.5 million in fairness investments in 22 MDIs and Group Growth Monetary Establishments, and taking fairness stakes of lower than 5% of every lender.
For the smaller lenders, the inflow of deposits “expands their capability to make loans” for housing or companies, D. Steve Boland, Financial institution of America’s chief administrative officer, mentioned in an interview. “What we might hope is our instance attracts in others” to make related strikes, he mentioned.
The deposits will in all probability vary from $1 million to $10 million, Boland mentioned. Optus Financial institution, Southern Bancorp and Metropolis First Financial institution are among the many lenders that can obtain deposits.
“MDIs are a crucial useful resource to minority and underserved communities,” offering banking providers, creating jobs and serving to companies, Boland mentioned individually in an announcement.
U.S. banking giants have expanded their racial-equity pledges within the years after 2020, when the killing of George Floyd, a Black man, by a police officer sparked international protests.
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Reporting by Lananh Nguyen; Enhancing by Muralikumar Anantharaman and Chizu Nomiyama