PLATFORM : The Best Case for Support of Minority Banks

The government report on lending confirms what many already knew--the existence of discriminatory banking practices. The report is further evidence that there is a critical need for black financial institutions.

We don’t necessarily need more black financial establishments--there are four (African-American-owned) institutions in Los Angeles. However, those institutions need more support from their surrounding communities. Of the deposits blacks have in Los Angeles banks, less than 4% of the value is held by black-owned financial institutions.

I don’t expect majority-owned banks to change their practices. Even if racial bias in banking did not exist, there would be a higher tendency to reject minority loan applications because the major banks expect applicants to have a pristine credit record. Because minorities are the first fired and last hired, many blacks have specks in their credit history.

Blacks need to be more aware of the stakes. If they don’t provide more support, black-owned financial institutions will disappear and minorities will lose an opportunity to get the financial backing needed to participate more fully in the economy.