Independent Banker - February 2024 - 56

but is keenly aware of how capital
constraints sometimes impede the
bank's vision.
This is not a new problem for MDIs
and may also reflect systemic factors.
" There's been a real historical issue of
the inability of MDIs to gain access to
Tier 1 capital, " says John Lewis, CEO
and president of $372 million-asset
The Harbor Bank in Baltimore.
In recent years, both the federal
government and private sectors have
focused on increasing MDIs' access
to capital. In 2021, the U.S. Treasury
provided $9 billion directly to MDIs
and CDFIs through the Emergency
Capital Investment Program (ECIP) to
support loans, grants and forbearances
in these banks' communities.
" ECIP's been a game changer for our
institution, " says James Sills, president
and CEO of $426 million-asset M&F
Bank in Durham, N.C. M&F, the
second-oldest African Americanowned
bank in the U.S., received
$80 million from ECIP in June 2022.
" Our legal lending limit increased
because we have more capital, " Sills
says. " When we provide that capital,
it allows businesses to grow, hire
more people, hire other vendors and
purchase services. Most minority firms
are located in minority communities.
It's a great way to improve the
ecosystem in a lot of minority
communities across the country. "
Naudon agrees, noting that ECIP
funds made it possible for Ponce Bank
to fund a large affordable housing
project in the Bronx-an immediate,
meaningful community improvement.
" It's literally around the corner from
our bank headquarters, " he says. " It
was too big for us, and we would have
exceeded the amount we could loan to
one borrower. We closed on the loan
a few days after we got the funds from
the U.S. Treasury. "
HOUSING: A KEY FOCUS FOR MDIS
MDIs routinely prioritize affordable
housing projects because of the role
homeownership plays in generational
wealth creation. " Homeownership has
President and CEO
Carlos P. Naudon says
80% of Ponce Bank's
branches are in lowand
moderate-income
neighborhoods.
" WE'RE A
COMMUNITY
BANK AND WE
ARE PROUD
TO SAY THAT
WE GO AND
MEET OUR
CUSTOMERS
WHERE
THEY ARE. "
-James Sills, M&F Bank
56 // ICBA Independent Banker // February 2024
always been one of the best ways for
a family to build some wealth, " says
Josh Pape, COO of $430 million-asset
Chickasaw Community Bank (CCB)
in Oklahoma City, Okla. " When you
help people into homeownership, not
only are immediate living conditions
drastically improved, but it builds
intergenerational wealth. "
When Southern Bancorp in
Arkadelphia, Ark., received
$250 million in ECIP funding, it
focused on affordable housing.
" We are embarking on a significant
expansion of our affordable home
mortgage division to really attack the
homeownership gap, " reports Darrin
Williams, CEO of Southern Bancorp
Inc., the holding company that wholly
owns $2.5 billion-asset Southern
Bancorp Bank. " We have expanded our
mortgage loan originators and hired a
new president of the home mortgage
division. We were always planning to
do this. The ECIP funding has allowed
us to increase the speed and pace of
our expansion. "
Independent Banker - February 2024

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