During the first MDI Partnership Summit held today in Orlando, Florida, participants from minority depository institutions and banks across the country gathered to discuss approaches to better serve the unique banking needs of communities of color and low- to moderate-income communities. The event, which followed the ABA Conference for Community Bankers, was co-hosted by ABA’s Minority Depository Institutions Advisory Council and the National Bankers Association and drew more than 120 attendees from banks of all sizes.
During a presentation about creating mutually beneficial long-term partnerships, Kenneth Kelly, chairman and CEO of First Independence Bank in Detroit, emphasized that “partnerships produce productivity,” noting that the banking sector is uniquely positioned to be a vehicle for change because “money touches everyone in this country.”
The event was designed to facilitate deeper and broader partnerships between MDIs and larger banks, which participants said can be a powerful tool to drive systemic change and help close the racial wealth gap. Attendees discussed partnership models focused on loan origination, deposits, branch locations and ATM networks, and noted that in the last three years, MDIs have experienced 35% growth in asset size. In discussing approaches to facilitate reciprocal deposit placement in MDI banks—which are critical to support MDI lending in low- to moderate-income communities—speakers said deposits into MDIs are relatively simple to arrange with regard to risk, terms and administrative complexity (paperwork). “This is a moment in time when something really important, is really easy,” said Dan Letendre, managing director for Bank of America.
According to the FDIC, as of Sept. 30 last year, there were 145 FDIC-insured MDIs in the United States, with 1,400 branches and combined total assets of over $329 billion. The next MDI Partnership Summit will be held on Oct. 19 in Washington, D.C.