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Allocating Resources to Communities of Color


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First Independence Bank’s commitment to communities of color is unwavering—and evolving.

The bank, also known as FIB, was founded more than a half century ago in Detroit. After high unemployment, extreme poverty and racial segregation sparked deadly race riots in the city in 1967, FIB saw a need to create economic stability for diverse and underserved communities. The goal: democratize access to personal and commercial banking services.

The need to improve financial wellness in the communities that FIB serves hasn’t diminished. In fact, the potential spending power for Black Americans would be 64% higher—$1.6 trillion instead of $976 billion—if disparities in household income improved, according to recent estimates by the Federal Reserve Bank of St. Louis.

Meanwhile, Black adults score well below white adults on all eight functional areas of financial literacy and wellness measured by the P-Fin Index, an annual survey developed by the TIAA Institute and the Global Financial Literacy Excellence Center at George Washington University. (Functional areas range from earning and saving to borrowing and investing.)

Investing in innovative solutions

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“Historically, there have been challenges when we look at the data along financial lines, along racial lines, along gender lines,” said Kenneth Kelly, chairman and CEO of First Independence Bank. “I'm hopeful that [everyone who comes] to the table to be a part of this discussion thinks about innovative ways to approach and tackle these issues.”

Today, FIB is one of the largest Black-owned banks in America. It’s also one of 148 minority depository institutions (MDIs)—and one of 22 Black-owned MDIs—operating in the United States, according to the most recent FDIC data.

FIB’s offerings range from checking, savings and investment accounts to loans that help owners of small and midsize businesses launch or expand their operations. FIB also has created more robust online and mobile tools that help users transfer funds more quickly, approve automated clearing house (ACH) files and explore account activity—all with the option of fingerprint login to boost security.

Empowering opportunity through financial literacy

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34%

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Percentage of Black adults who answered over one-half of P-Fin Index questions correctly

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53%

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Percentage of white adults who answered over one-half of the same questions correctly

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By working with JPMorgan Chase and others, FIB is helping to close financial literacy gaps and widen pathways for communities of color. FIB has launched programs like Enrich, which offers budgeting tools and courses that help its clients and constituents set and achieve financial goals. The bank also partnered with MassMutual Great Lakes to host seminars that introduced financial fundamentals such as savings and retirement planning.

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FIB also recently expanded a multiyear partnership with Operation Hope, a nonprofit that aims to launch 1 million Black-owned businesses by 2030. (JPMorgan Chase has long supported Operation Hope, including through investments and volunteer efforts). FIB’s core outreach push for the Operation Hope partnership includes more coaching, wider access to educational resources and targeted counseling to help improve credit scores.

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Through such offerings, FIB is helping its clients “be part of the American Dream,” said Dimitrius Hutcherson, executive vice president, chief administrative officer and chief technology officer at First Independence Bank. With enhanced financial literacy, they are better equipped to “buy a house, potentially prepare for retirement and invest in products that they normally would not be able to. They are learning how to use credit as a tool—and not necessarily a trap.”

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A powerful pledge

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FIB’s resolve and impact are strengthened by being part of the Empower share class initiative that J.P. Morgan Asset Management is leading. Offered across J.P. Morgan’s money market funds, the Empower share class allows institutional clients to support MDIs and Community Development Financial Institutions (CDFIs) by investing in an off-balance sheet vehicle they’re already comfortable with and receiving the same return on those investments. This, in turn, delivers a recurring revenue stream to MDIs and CDFIs.

What’s more, JPMorgan’s Commercial Banking partnership with FIB brings the full force of the firm, helping FIB thrive in a competitive market and deliver on the needs of the communities of color it serves. 

Let’s talk

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JPMorgan Chase has invested more than $100 million in MDIs and CDFIs led by Black and Hispanic and Latino owners. These institutions—operating in 19 states and the District of Columbia—receive customized advisory support from the firm’s Advancing Black Pathways Fellows and . They also get access to the firm’s leadership and training programs to help build their capacity and solve emerging challenges.

Contact your JPMorgan Chase banking relationship team to learn how we can help your business. And be sure to sign up for more Commercial Banking insights at the bottom of the page and follow us on LinkedIn.

© 2023 JPMorgan Chase & Co. All rights reserved. JPMorgan Chase Bank, N.A. Member FDIC. Visit jpmorgan.com/commercial-banking/legal-disclaimer for disclosures and disclaimers related to this content.

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