Community development bank

From Wikipedia, the free encyclopedia

Community development banks (CDBs) are a special kind of bank designed to serve the residents of and spur economic development in low to moderate income (LMI) areas. When CDBs provide retail banking services, they usually target customers from "financially underserved" demographics. Community development banks can apply for formal certification as a Community Development Financial Institution (CDFI) from the Community Development Financial Institutions Fund of the U.S. Department of the Treasury.

Organizers wishing to start a de novo CDB in the United States can seek either a State or National bank charter. Like any national bank, all Federally chartered CDBs are regulated primarily by the Office of the Comptroller of the Currency. According to the OCC Charter Licensing Manual, CDBs are required "to lend, invest, and provide services primarily to LMI individuals or communities in which it is chartered to conduct business." State-chartered Community Development Banks are subject to regulations, qualifications, and definitions that vary from state to state.

The largest and oldest community development bank holding company is ShoreBank, headquartered in the South Shore neighborhood of Chicago. Through its holding company structure, ShoreBank Corporation promotes its community development mission by operating CDBs and other affiliates in certain U.S. cities.

Other CDBs include:

• Albina Community Bank in Portland, OR
• Carver Federal Savings Bank in New York, NY
• Central Bank of Kansas City in Kansas City, MO
• City First Bank of D.C. in Washington, D.C.
• Dryades Savings Bank in New Orleans, LA
• Liberty Bank & Trust in New Orleans, LA
• Louisville Community Development Bank in Louisville, KY
• Neighborhood National Bank in San Diego, CA
• Southern Bancorp in Arkadelphia, AR
• University National Bank in St. Paul, MN