Business & Money

Big banks leaving poor neighborhoods

By Nisa Islam Muhammad -Staff Writer- | Last updated: Mar 22, 2019 - 3:13:06 PM

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Big banks are leaving poor neighborhoods for more affluent ones, according to a report by Bloomberg News, and JP Morgan Chase bank is leading the way. They are forgoing branches for ATMs and online banking.


Last year, JPMorgan Chase, the country’s biggest bank, announced plans to spend billions to open 400 branches and boost lending in a national expansion to widen the lender’s profile to new states for the first time in a decade.

Since then, according to Bloomberg, the bank applied to open 185 new branches, with 71 percent of them in more affluent areas. The bank also gave notice to regulators of its intention to shut 187 branches.

About half of those are in neighborhoods where household income is below the national median of $60,336, according to a Bloomberg analysis of regulatory and U.S. Census data.

Anne Pace, a JPMorgan Chase spokeswoman, said a national view of the data is skewed because it assumes that family income in all communities is the same.

“In our footprint, Chase has significantly more branches and more deposits in low- to moderate-income neighborhoods than any other competitor,’’ Ms. Pace said in an emailed statement to Bloomberg.

“Even when we’ve consolidated branches, we continue to grow market share in those neighborhoods. In most cases the next closest branch is less than two miles away.’’

The S&P Global Market explained that nationally, banks have shut 1,915 more branches in lower-income neighborhoods than they’ve opened in the four years through 2018, the three largest consumer banks—JPMorgan, Wells Fargo and Bank of America—led the way.

Other big banks also disagreed with Bloomberg’s report.

“About one-third of our financial center network is in [low- and moderate-income] neighborhoods and that has been consistent over a number of years,” Bank of America spokesperson Betty Riess told Fortune magazine.

Wells Fargo sent a statement to Fortune saying it serves “significantly more markets than any other national bank peers, including in underserved communities where our branch closures have been notably lower (down 5 percent between 2014-2018) than closures in other markets (down 13 percent between 2014-2018).”

Closing local bank branches affects that community’s small business loans and home mortgages with Blacks suffering the most. But big banks are not the only options. Credit unions, smaller banks and Black banks are also options. was started as an independent grassroots organization, formed out of the larger #BankBlack Movement following deadly police shootings in Black communities in July 2016.

They were part of a social media campaign that resulted in an estimated $60 million being moved to Black-owned banks in just nine months. There are only 19 Black-owned banks as of Oct. 30, 2018, according to

The top five Black Banks are:

  1. OneUnited Bank

• Assets: $661 million

• Headquarters: Boston

• Deposits: $376 million

• Number of branches: Six

Founded in 1968, the nation’s largest Black-owned bank’s slogan is “part protest, part progress.” OneUnited is a government-designated CDFI (COMMUNITY DEVELOPMENT FINANCIAL INSTITUTION) serving low- to moderate-income communities. It holds workshops to increase financial literacy and offers affordable financial services, including a secured credit card for rebuilding credit and a second-chance checking account.

  1. Liberty Bank and Trust Company

• Assets: Over $594 million

• Headquarters: New Orleans

• Deposits: $549 million

• Number of branches: 22

Liberty Bank, a CDFI with branches in seven states, has increased its assets from $183 million a decade ago to more than $594 million today. Its Liberty Foundation pursues philanthropic initiatives, such as expanding access to secondary and higher education and increasing the availability of affordable housing.

  1. Citizens Trust Bank

• Assets: $399 million

• Headquarters: Atlanta

• Deposits: $340 million

• Number of branches: 10

Founded in 1921, this strong bank increased its assets, loans and mortgage originations in 2016. Its deposit accounts increased at six times the normal rate last year, thanks to an increased awareness of Citizens Trust generated by social media. The bank offers an affordable housing program for buyers who need down payment assistance.

  1. Industrial Bank

• Assets: $423 million

• Headquarters: Washington, D.C.

• Deposits: $331 million

• Number of branches: Seven

Industrial Bank, a CDFI founded in 1934, received about $2.7 million in deposits through more than 1,500 new accounts last July as part of D.C.’s #DivestToInvest movement, whose goal is to support Black-owned banks and businesses. In 2015, the bank earned a Bank Enterprise Award worth $253,000 for increasing the number of loans it made in low-and moderate-income communities. More than 60 percent of its assets have been invested in these communities for more than 10 years.

  1. The Harbor Bank of Maryland

• Assets: $266 million

• Headquarters: Baltimore

• Deposits: $233 million

• Number of branches: Seven

Opened in 1982, Harbor Bank primarily serves the Baltimore area with a variety of checking and savings accounts and loans. It is the country’s first community bank to have an investment subsidiary, Harbor Financial Services. Last November the bank announced plans to open a co-working incubator at its downtown headquarters to support local Black-owned startups as well as community development and advocacy groups. It also received $70 million in federal funding to revitalize low-income communities.