In conjunction with Financial Capability Month (April 1-30) and Teach Your Child to Save Day (April 20th), BauerFinancial pays tribute to banks that don’t need a special day or month to play their part because they do it everyday.
The 1st, ***Young Americans Bank, Denver, CO, was chartered in 1987—two decades before “Financial Literacy” became a national cause. With a mission to “develop financial literacy of young people through real-life experiences” and a belief that “kids should grow up knowing how to earn, make, and manage their money wisely”, Young Americans Bank has helped more than 675,000 of America’s youth (21 and younger) become financially self-sufficient while having fun in the process.
Young American Bank understood that a large percent of the population, regardless of age, income and education, lacked the basic financial knowledge needed to teach their own children, so they are doing it for them. The bank itself is a “for-profit” business but it operates in conjunction with many non-profit programs that enable it to reach out to youth in Colorado and beyond.
Young Americans Bank is the only FDIC-insured institution with such a mission. There are, however, other banks with equally altruistic ambitions. For example, earlier this year, the ABA Banking Journal (1/5/18) highlighted banks that are “Reducing Recidivism through Financial Knowledge”. Recidivism, by definition, is the tendency of a convicted criminal to reoffend. In reality, financial literacy, or lack thereof, is a major obstacle keeping convicts, particularly females, from the straight and narrow.
According to the ABA Article: ***** 1st Security Bank, Mountlake Terr, WA facilitates financial literacy sessions in conjunction with the Washington Corrections Center for Women. And JRN listee ****Old National Bank, Evansville, IN partners with the Henderson County, KY Detention Center. This program has been so successful it has been expanded to male inmates and they have plans to extend it throughout the state of Indiana.
Both of these programs prepare the inmates for a successful life after release giving the ability to manage their finances and households.
And finally, there are the banks listed on page 7 and on this week’s supplement. These banks are all Minority Depository Institutions (MDIs) as defined by the FDIC. The MDI designation was established in 1989 in the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) which defined an MDI as any depository institution where 51% or more of the stock is owned by one or more “socially and economically disadvantaged individuals”.
It turned out, however, that term “socially and economically disadvantaged individuals” was too ambiguous so it was replaced with “minority individuals”. Minority was then defined as:
|Minority Group Represented on Insert as||Abbr.|
|Black or African-American||B|
|Native American (including Pacific Islander)||N|
|Multiple (more than one of the above)||M|
And, in addition to institutions that meet the ownership test, an institution will be classified as an MDI if a majority of its Board of Directors is minority AND the community it serves is predominantly minority. The banks on this week’s list all fill the requirements, and all provide a certain level of support.
Some of these MDIs, however, go above and beyond to educate their customers. For example, on its website, **Commonwealth National Bank, Mobile, AL has a practical money skills game center where you can play an NFL themed video game or go on a road trip to financial stability.
***Carver State Bank, Savannah, GA takes a different tack as its education center is all business. At Carver, if you have run into financial problems in the past you can open a “Second Chance Checking Account”. They also provide credit counseling and offer a credit rebuilder loan program. It has even partnered with the City of Savannah to help low-income individuals and families become small business owners and college graduates.
*****Centinel Bank of Taos, NM has developed several programs to help give back to its community including: youth initiatives and education programs; financial literacy programs for all ages, children to seniors and partnerships with local non-profits and other organizations.
So, while we support Financial Capability Month and Teach Your Child To Save Day, we also support the efforts of these banks. In their own ways, they are making a difference in their communities, and they are doing it everyday just as a matter of course.