Independent Banker - November 2022 - 54

Serving the whole
community
Native American banks are
primarily owned by Native
Americans, and most of their
customers come from those
communities, but they do not
typically restrict their services
to Native Americans. In fact,
Lumbee Guaranty Bank in
Fayetteville, N.C., encourages
people who are not members
of the Lumbee tribe to bank
with it by incorporating a
tagline in its marketing: " A
Bank for Everyone. "
" We're extremely proud of
why the bank was founded
and our original mission, "
says Kyle Chavis, CEO of
Lumbee Guaranty Bank.
" But sometimes that's a little
bit of a barrier to folks, and
their first question is, 'Can
I bank with you if I'm not a
Native?' And so, we have to
really be diligent about our
marketing efforts, especially
in communities that are on
the periphery of our footprint,
to get that message out that
we're a bank for everyone.
" Again, we're locally owned,
we're Native owned, we're
proud of who we are, but
we're a bank for everybody. "
community banks, Native American
banks offered Payroll Protection
Program (PPP) loans to businesses
in their communities. For example,
Lumbee Guaranty Bank originated
about 600 PPP loans worth
$31 million, Chavis says. Those
loans-about 35% of which were to
Native-owned businesses-saved
4,700 jobs.
Lumbee Guaranty Bank processed
those loans manually, Chavis says,
and the quick, personal service
worked well for it and its borrowers.
" It was a lot of work to handle the
process manually, but it ended up
being a really good outcome for us,
from the standpoint of having all
of our loans forgiven, " Chavis says.
" We also created goodwill in the
community and were able to acquire
some relationships from some of
our larger competitors
because of how we
handled the PPP
process. It just ended
up being a big win
for us. "
Government help
Chickasaw Community
Bank has tapped the
Bureau of Indian
Affairs' Indian
Guarantee and
Insurance Program,
which provides a 90%
guarantee on loans
made to businesses that
are 51% or more Native
American-owned. Pape
says the bank has used
that program for loans
over the past few years.
" We've been able to use those
proceeds to extend some capital to
businesses that may not otherwise
be eligible under traditional bank
programs. A couple of examples are
a trucking company and a home
healthcare company. "
As with housing funds, Native
American banks sometimes get
creative to help tribal businesses
leverage anticipated federal dollars.
For example, Chickasaw Community
Bank loaned money to a charter
school whose enrollment is 87%
Native American. The school had
received a reimbursement grant
through the Coronavirus Aid, Relief
and Economic Security (CARES) Act,
but it didn't have the cash to spend to
get reimbursed.
" So, we used that Native American
revolving loan fund to give them
" It was always unsettling that
the first people here owned
homes at the lowest rate of
any demographic in the United
States. And so, the bank really
sought out to be a leader in that,
and we certainly have been. "
- Josh Pape,
Chickasaw Community Bank
As a Community Development
Financial Institution (CDFI),
Chickasaw Community Bank received
a grant in 2021, allowing it to lend
money to Native American-owned
businesses that were affected
by COVID.
" We used those funds to create
what we've coined a Native American
revolving loan fund, " Pape says.
54 Q ICBA Independent Banker Q November 2022
the capital they could go spend, and
then when they get reimbursed, that
reimbursement comes back in and
pays their loan back, " Pape explains.
Some Native American-owned
banks do not limit their business
lending to a particular geography.
Native American Bank, for example,
only has physical offices in Denver and
Browning, Mont., but it is considering
Independent Banker - November 2022

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