Chicago officials are joining the nationwide push to #BankBlack by entrusting millions of dollars to the city’s last Black-owned lender.
City treasurer Kurt Summers announced Monday, Sept. 18, that Chicago would pump $20 million in deposits to Illinois Service Federal Savings & Loan Association, Bloomberg News reported. Chicago has seemingly taken a cue from the #BankBlack movement, which over the past year has encouraged consumers to open up accounts at Black-owned banks.
“If we’re gonna be serious about supporting those communities and supporting community bank, and what they do for small businesses, [then] we have to look for opportunities like this,” Summers told the news site.
Founded by 13 Black men in 1934, Illinois Service Federal was a unique savings and loan association serving Chicago’s African-American residents at a time when it was impossible for Blacks to get their hands on mortgage or business loans, because of racial discrimination. The institution’s first few depositors had balances ranging from $4 to $50, according to the ISF website, but its assets soon grew substantially, allowing the bank to support the local community.
The lender has experienced major overhauls in recent years, the latest one coming in 2016 when Ghana’s Nduom family invested $9 million into it. ISF was at risk of being shut down the year before if it failed to raise enough capital, the Chicago Tribune reported.
Now, the bank is Chicago’s last standing Black-owned lender after Seaway Bank & Trust, the only other Black-owned bank in the city, was closed and sold last year.
“The state of the black-owned bank in the country is at crisis proportions,” Summers said, highlighting the bleak reality that there are just 23 Black-owned financial institutions left in the U.S. “In Chicago, we’re on our last legs.”
ISF Chairman Papa Kwesi Nduom that the city’s large deposit will now help bolster the bank’s financial foundation.
This will ensure “that we can strengthen the economic base of our communities and help people fulfill their dreams,” Nduom said in a statement.
“It’s about being a community bank,” he told the Chicago Tribune. “Community banks are a great opportunity for that because they are designed for the sole purpose of reinvesting in their local area.”