A long-standing community bank in South L.A. serving urban Hispanic and Black communities
Minority Depository Institutions (MDI) have a strong and essential place in our banking system because, unfortunately, discrimination has always been a part of the general lending history of this nation’s banks. Broadway Federal Bank is a great example of an MDI which has been consistently serving underbanked minority communities in South Los Angeles since 1946.
The bank was formed by local businesspeople and community leaders to fill the loan needs of Black and Latino individuals, many of whom were returning veterans, and who were barred from receiving basic loans from typical financial institutions at the time. Broadway Federal has survived through a fire that razed their headquarters during the Rodney King riots in 1992, and even had some trouble with one of their loan officers approving insecure loans to churches for bribes in 2007 through 2010. Still, they have managed to faithfully and efficiently serve their communities for nearly 75 years.
Their mission statement not only reaffirms the the bank’s commitment to excellent service to “underserved urban communities,” but also their goal to support their employees in community service and involvement. Since the appointment of a new CEO in 2012, they have refocused on investing in multi-family housing, which is more in demand by low-and-moderate income families in Southern California.
You can tell that they have a real engagement in their local community; after more than 70 years in business, all of their branches are in the bank’s original neighborhoods. They only have three branches, one in each of the Mid-Wilshire, Inglewood and Exposition Park neighborhoods. For those typically banking outside of these neighborhoods, they have a partnership with MoneyPass ATMs which allows their members to access cash, fee-free, at more than 20,000 ATMs across the US.
This bank’s statistics reinforce their mission and reputation. Most of their lending—a full 90%—is devoted to housing, with 70% of this going to low- and moderate-income borrowers. Two of their three branches are in low-and-moderate-income census tracts, and they are a small local institution with assets of about 400 million. Although they are somewhat over-loaned with a net-loans-to-deposits ratio of 120%, they’ve got a solid return on assets. They have achieved an Outstanding CRA rating for their last eight exam cycles, verifying that this is an impactful banking option. Their mobile and online banking services make it possible for anyone to use a checking account, and their basic checking account is charge-free for anyone who receives e-statements instead of paper ones.
Check out the services and accounts they offer here, as this is a great Better Banking Option for anyone looking to invest in Black and Hispanic communities in underserved neighborhoods in Los Angeles.