Independent Banker - December 2021 - 69

Beneficial State Bank's
financial activism
The idea that community banking can be a force for positive change is at the heart of Beneficial State Bank,
which engages its customers through financial activism. By Roshan McArthur
he team at Beneficial State Bank
believes that banking has the
power to bring about radical change.
That's why it's driven by an ambitious
mission that puts people, planet and
prosperity front and center.
The $1.5 billion-asset community
bank in Oakland, Calif., wears
this mission proudly. Founded in
2007 with a focus on community
development, the community
development financial institution
(CDFI) has goals that extend far
beyond its West Coast communities.
Visit its website and you'll find
issues like the shortage of affordable
housing, the climate crisis and the
problem of white supremacy taking
center stage. Customers are invited
to become financial activists, taking
action with their deposits to build a
more inclusive economy for all.
It's a mission that doesn't pull any
punches, and CEO Randell Leach is
aware that it aims very high, admitting
with amusement that his team at the
bank is " a bit of a different breed. "
T
" We want to make sure we provide real value
for folks. The return from that value creation
flows back to the benefit of Beneficial State
Foundation, and the foundation is governed in
the public interest as a nonprofit. That's a very
powerful economic model. "
-RANDELL LEACH, BENEFICIAL STATE BANK
Beneficial State Bank was born
from a bold idea and a gift of capital
from activists and philanthropists
Kat Taylor and Tom Steyer. When
it comes down to it, though, the
community bank's mission is
radically simple. What underpins its
work is a belief that banking can be a
vehicle for positive change.
" Most organizations ... are like,
Name:
Beneficial State Bank
Assets:
$1.5 billion
Location:
Oakland, Calif.
'Where is the most profitable market
segment?' " Leach says. " So, you're
focused on ROE [return on equity]
as a measure of growth and earnings.
We believe that is an important
consideration, because financial
health matters to us, but we also look
at where we maximize our social
impact or our environmental impact,
and we optimize across these triple
bottom lines. What we do is we take
that ethos and apply it to all of our
decision-making in our product
development or marketing. It's how
we look at everything. "
To that end, Beneficial State Bank
is affiliated with several changemaking
organizations. It's a CDFI,
which means that 60% of lending
is made to low- and moderateincome
customers or underserved
communities. The community
bank is a member of the Global
Alliance for Banking on Values, a
worldwide consortium of financial
institutions calling for transparency
and support of economic, social
and environmental sustainability.
And it's one of a handful of financial
institutions with B Corp certification,
a commitment overseen by the
nonprofit B Labs that verifies the
community bank's commitment
to social and environmental
performance, public transparency
and legal accountability.
Beneficial State Bank achieved its
B Corp status in 2012 and renews
it every three years. Leach highly
recommends the process to other
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Independent Banker - December 2021

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