JPMorgan Chase Uses $ 30 Billion To Advance Racial Equity

The largest bank in the United States, JPMorgan Chase, on Tuesday unveiled a series of new initiatives as part of its recently announced $ 30 billion pledge to advance racial equity over the next five years.

The financial institution is committed to supporting Minority Depository Institutions (MDIs) and Diversity-led Community Development Financial Institutions (CDFIs) as part of its program. “We know these critical institutions are creating lasting change for the Black and Latinx families,” said Brian Lamb, Global Head of Diversity and Inclusion at JPMorgan Chase, in making the announcement, “and we hope our support will help uplift the people and businesses who 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 partnering with MDIs and CDFIs to deliver economic opportunities to underserved communities. The program will introduce a new Empower money market share class, which will be distributed exclusively by MDIs and CDFIs, including the 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 enable institutional clients and investors to support diversity-led MDIs and CDFIs helping to create positive social impact.

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An annual donation of 12.5% ​​of the income from asset management fees of the Empower share class will be made to the Empower and Community Development Fund of the Chicago Community Trust. Institutions will also have access to the depth and breadth of JPMorgan Asset Management’s resources, including the Morgan Money digital investment platform, sales and marketing report, and customer service. 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 MDIs led by Black and Latinx as part of a $ 50 million equity pledge. The initial round of investment will be used to support minority-owned and black-led 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 plans to increase its investments in MDIs to also include Latinx-led MDIs and give institutions access to $ 500 million in community loans across the country to create wealth in communities and develop local businesses. The funds can be used to provide more loans to consumers and businesses, expand operations and open branches to serve more communities, and invest in new digital technologies and capabilities to modernize platforms, improve efficiency and provide a better customer experience.

In addition to the investments, MDIs will become clients of JPMorgan and have access to the company’s expertise, solutions and network.

The announcement builds on the company’s close relationships with Liberty Bank and Trust and the Harbor Bank of Maryland as part of the Treasury Department’s Bank Mentor Protégé program, which aims to promote inclusion among financial institutions and to extend access to banking services to all communities.

“JPMorgan Chase was one of the first to become a Mentor Bank in the Treasury Bank’s Protected Mentorship Program,” said Lorraine Cole, head of diversity and inclusion at the US Department of the Treasury. “The expansion of mentorship and training support to diversity-led banks demonstrates the serious commitment they share with the Treasury to maintain and build the capacity of small minority-owned banks. And, their newly announced financial products and equity investments aimed specifically at IDMs and CDFIs can have a profound impact on the communities they serve.

In recent months, other large banks have also invested or created programs with minority-owned banks.

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JPMorgan will also work with MDIs and CFDIs to offer New Market Tax Credit Premium Investment Awards for Black-owned, Black-led, and serving businesses and nonprofits. Black. Funding will go to significant community projects, including grocery stores, shelters, health clinics and small businesses. The racial equity program is part of an additional $ 100 million per year from the NMTC dedicated to various organizations.

The first $ 20 million investment, made in partnership with the Harbor Bank of Maryland, City First Bank and Partners for the Common Good, will provide vital funds to the Washington, DC-based Community of Hope for the purchase , the renovation and expansion of family health. and a birthing center, which will provide more than 5,800 patients with medical, dental and behavioral health services each year. Community of Hope is the only medical facility with a labor and delivery unit serving Northeast and Southeast DC and helps nearly 400 women a year with antenatal care.

JPMorgan will further provide more than $ 300 million in additional funding to CDFIs over the next five years, after providing more than $ 285 million in loans to CDFIs and their affiliates in 2020 and supporting the development of food banks and shelters, health centers, grocery stores and schools. across the country through the NMTC’s racial equity program. At least six of the projects, totaling more than $ 60 million in funding, specifically supported low-income communities.

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Other programs JPMorgan has put in place 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 opportunities in cities around the world including Detroit, Chicago, the Bay Area, the Greater Washington (DC) area and the Greater Paris
• The JPMorgan Chase Policy Center, which develops and advances sustainable, evidence-based policy solutions to drive economic growth in collaboration with political, business and community leaders
• The Entrepreneurs of Color Fund, a collaboration with the Society for the Support of Local Initiatives (LISC) and a network of CDFIs that provide black, Latinx and other underserved entrepreneurs with access to capital and technical expertise
• New Skills at Work, a $ 350 million initiative to hire employees with a background of crime and support their reintegration into the workforce