By Kenneth Kelly
ABA Chair Kenneth Kelly is chairman and CEO of First Independence Bank in Detroit.
Access to capital is essential for individuals, businesses and communities to thrive. If you go to any major city in the U.S., it is very likely that one of the tallest buildings in that city will have a bank’s name on it. Banks represent the aspirations of their communities by providing credit to materialize the visions of so many citizens and organizations.
The free flow of credit has been fundamental to the success of the U.S. economy since our country’s founding. However, when one looks back through our nation’s history, the data is clear that for women, communities of color and other minority groups, access to credit was not always readily available or easy to obtain.
But just as we have a strong tradition of free markets in the U.S., we also have a longstanding tradition of communities coming together to meet the credit needs of our neighbors.
We’ve seen this in the mutual banking structure that became prominent, particularly among working-class communities in the northeast throughout the 19th century. We’ve also seen it in the establishment of community depository financial institutions and minority depository institutions across the country, like First Independence Bank, of which I am proud to be chairman and CEO.
First Independence was founded in the late 1960s — we were, as I like to say, a positive outcome of the violent riots that took place in the summer of 1967, which were some of the most devastating in U.S. history.
Our experience in Minneapolis represents the very best of banking — a time when our industry banded together and did some good, centering local expertise and leadership to help uplift the entire community.
In the aftermath, it became clear that there was a need for a financial institution that could serve the predominantly Black community in Detroit. A group of 22 prominent members of the community got together and spent two and a half years raising capital and going through the regulatory process. Backed by over 2,000 investors and charged with a mission of fostering economic stability and empowerment, First Independence opened its doors on May 14, 1970.
My cousin, Don Davis — a longtime music industry veteran — acquired a controlling interest in the bank in 1980 and served as chairman up until his passing in 2014. I had the privilege of succeeding him in the role in 2017 and continuing our longstanding commitment to uplifting the Detroit community.
In 2020, we explored our commitment to Minneapolis, this time in the wake of the murder of George Floyd. At that time, First Independence was approached by a group of larger banks who wanted to do something to help that community, which was still reeling from yet another instance of police brutality. The ultimate decision was that those larger banks would help support First Independence’s move into the Minneapolis market. And when we opened our doors, we had representatives from those five larger banks standing with us, arm in arm.
MDIs, CDFIs and mutuals thrive because they have local leadership and local expertise. They know their communities and the people who live there, and they are able to provide credit based on their deep understanding of their customers and their needs. But they also benefit from partnerships with larger institutions that can help them achieve scale and provide important equity investments, correspondent banking relationships and so much more.
Our experience in Minneapolis represents the very best of banking — a time when our industry banded together and did some good, centering local expertise and leadership to help uplift the entire community.
That’s what bankers do best: We support the people and the places we serve. Whether we are helping our communities through periods of social unrest, recovering from devastating natural disasters like fires, floods and hurricanes, or navigating a dangerous global health event as we did during the COVID-19 pandemic, banks have always been — and will continue to be — beacons of hope and stability for the communities we serve.
