America’s largest bank, JPMorgan Chase, unveiled a series of new initiatives Tuesday as part of its recently announced $ 30 billion commitment to advance racial equity over the next five years.
The financial institution is committed to supporting minority depository institutions (MDIs) and community development finance institutions (CDFIs) run by various sectors as part of its program. “We know that these crucial institutions create lasting change for African American and Latino families,” said JPMorgan Chase Global Director of Diversity and Inclusion Brian Lamb in making the announcement, “and we hope that our support will help lift people up. and companies that are the backbone of our local economies. “
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JPMorgan will launch Empowering Change, a new program backed by a $ 500 million investment from Google and in partnership with MDI and CDFI to bring economic opportunity to underserved communities. The program will introduce a new Empower money market share class, which will be distributed exclusively by MDI and CDFI, including Harbor Bank of Maryland, Liberty Bank and Trust, M&F Bank and Unity National Bank.
In addition, the new Empower money market share class will allow institutional clients and investors to support MDIs and CDFIs run by various sectors, helping to create positive social impact.
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An annual donation of 12.5% of the proceeds received from the Empower share class asset management fees will be made to the Chicago Community Trust Empower and Community Development Fund. Institutions will also have access to the depth and breadth of JPMorgan’s asset management resources, including Morgan Money’s digital investment platform, sales and marketing report, and customer services. In addition, partner companies will receive training, education and marketing resources led by JPMorgan.
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JPMorgan is also committing $ 40 million to Black and Latinx targeted MDIs as part of a $ 50 million capital pledge. The initial round of investments will be used to support black-led and minority-owned MDIs, including the holding companies of Liberty Bank and Trust, M&F Bank, Carver Federal Savings Bank and Broadway Federal Bank.
By mid-year, JPMorgan Chase expects to increase its investments in MDIs to also include Latinx-led MDIs and provide institutions access to up to $ 500 million in community loans nationwide to build wealth in communities. and grow local businesses. The funds can be used to make more loans to consumers and businesses, expand operations and open branches to serve more communities, and invest in new technologies and digital capabilities to modernize platforms, drive efficiencies and provide a better customer experience.
In addition to the investments, the MDIs will become clients of JPMorgan and will have access to the company’s expertise, solutions and network.
The announcement builds on the firm’s close relationship with Liberty Bank and Trust and Harbor Bank of Maryland through the Treasury Department’s Bank Mentor Protégé Program, which aims to promote inclusion in financial institutions and expand access to banking services to all communities.
“JPMorgan Chase was one of the first to step forward to become a mentor bank in the Treasury Bank’s Mentor Protégé Program,” Lorraine Cole, director of diversity and inclusion for the US Department of the Treasury, said in a statement. “Their expansion of mentoring and training support to banks run by diverse groups demonstrates the serious commitment they share with the Treasury to sustaining and building capacity among small and minority-owned banks. And their recently announced financial products and capital investments, specifically targeting MDIs and CDFIs, can have a profound impact on the communities they serve. “
In recent months, other major banks have also invested or created programs with minority-owned banks.
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JPMorgan will also work with MDI and CFDI to offer new market tax credit premium investment pricing for Black-owned, Black-led, and Black-led nonprofits and businesses. Funding will go to significant community projects including supermarkets, shelters, health care clinics and small businesses. The racial equity program is part of an additional $ 100 million in NMTC funding dedicated annually to various organizations.
The first investment of $ 20 million, made in partnership with Harbor Bank of Maryland, City First Bank and Partners for the Common Good, will provide critical funds to the Washington, DC-based Community of Hope for the purchase, renovation and expansion of a center family health. and the birthing center, which will provide more than 5,800 patients with medical, dental and behavioral health services annually. Community of Hope is the only medical facility with a labor and delivery unit serving Northeast and Southeast DC, serving nearly 400 women per year with prenatal care.
JPMorgan will also provide more than $ 300 million in additional financing to CDFIs over the next five years, after originating more than $ 285 million in loans to CDFIs and their affiliates in 2020 and supporting the development of food banks and shelters, centers health care, supermarkets and schools. nationwide through NMTC’s racial equity program. At least six of the projects, totaling more than $ 60 million in funding, have specifically supported low-income communities.
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Other programs that JPMorgan has established to help communities around the world recover from the COVID-19 pandemic and the racial inequalities it has highlighted include:
- AdvancingCities, a $ 500 million philanthropic investment to drive inclusive growth and create greater economic opportunity in cities around the world, including Detroit, Chicago, the Bay Area, the Washington (DC) metropolitan area and the metropolitan area from Paris.
- The JPMorgan Chase Policy Center, which develops and promotes evidence-based and sustainable policy solutions to drive economic growth in collaboration with political, business and community leaders.
- The Entrepreneurs of Color Fund, a collaboration with the Local Initiatives Support Corporation (LISC) and a network of CDFIs that provide black, Latino and other underserved entrepreneurs with access to capital and technical expertise
- New Skills at Work, a $ 350 million initiative that focuses on hiring employees with criminal records and supporting their re-entry into the workforce