A CDFI and MDI in San Francisco investing in low- and moderate-income neighborhoods
In last week’s feature article, we talked about how deregulation in the banking industry has left us unable to get data from more than half of banking institutions about how much they are lending in low- and moderate-income (LMI) census tracts. While this was intended to relieve the small institutions which may struggle to track and report this data, the effect for the average banking customer is that for many institutions, you can’t tell what portion of your deposits is going to neighborhoods that need it most. Mission National is one bank that is small enough to be exempt from reporting, but we’ve found enough indicators in our research that demonstrate that they’ve made significant efforts to invest in LMI neighborhoods.
The main indicators which prove their commitment to community development lending are their designations as a CDFI and an MDI. To earn those designations, the institution must go through an application process and meet certain benchmarks. The designations also allow Mission National Bank to receive support, either through training or capital, from government programs which support lending in LMI census tracts. Mission National having the CDFI designation shows that they care enough to earn it- even as a fairly small institution, they took the time to apply and meet the benchmarks for approval.
They’re also an MDI, meaning that either half of their board members or half of their members are of a particular minority group. This is significant because, as Mission National says on their website, the most common barrier which keeps people from receiving adequate banking services is language. MDIs will often have the resources to hire employees who speak a second language, who can help immigrant customers who may not speak English well enough to fully understand their finances. This is particularly important for this particular Better Banking Option, as Mission says that “over 90% of MNB’s customers are first and second generation immigrants.”
Mission National Bank has only three branches, two in San Francisco and one in Berkeley. Because they still only have assets of about a quarter-billion dollars, they’re exempt from reporting DLI-HMDA data, but we can still see that about 30% of their lending is devoted to housing. They’re a certified CDFI who specifically targets LMI census tracts, so we can assume a significant portion of housing lending is going to LMI households. They also devote 12.5% of their assets to small business, a particularly important area of lending when serving immigrant populations.
Mission National is a fantastic Better Banking Option for anyone in Berkeley or San Francisco who’s looking to invest in their cities’ neighborhoods that need investment the most. Income inequality is particularly pronounced in northern California, so it’s more important than ever that the people in these areas invest in community development banks and lending. They also offer online and mobile banking services, so it’s possible for anyone looking to invest in LMI communities in Berkeley and San Francisco. Check out their personal banking accounts on their website today to get started!