Detroit-based First Independence Bank Sees Growth Potential with New Minority Focused Investment Fund
The fund will be based on a sort of pitch competition model for banks looking for investments, which some have compared on the reality show “Shark Tank”.
Kelly welcomed such a model and believes the story of First Independence Bank will prove to be convincing.
“Well, I think… the reality is that we’re all still throwing,” he said. “If you want an investor to give you their hard-earned money because you have a good idea, you better have some form of pitch. Which means a story to tell and to demonstrate that you can execute that story for. achieve the desired result. “
First Independence, with just under $ 349 million in total assets, has seen growth in recent months. JPMorgan Chase earlier this week became the latest major bank to announce a stock investment in the black-owned institution.
Such actions are on the increase, particularly following the murder of George Floyd in May 2020 by a police officer in Minneapolis.
The specific amount Chase invested was not disclosed, but a press release said the investment was part of the bank’s $ 30 billion racial equity initiative.
“We are focused on creating lasting change to help close the racial wealth gap across the country,” Byna Elliott, Head of Advancing Black Pathways for JPMorgan Chase. “Providing additional access to capital and offering mentoring and training opportunities to these institutions is an essential element in fostering economic inclusion in our communities. We are extremely proud to support First Independence Bank and provide essential financial services to more Detroiters.
Additionally, First Independence announced in August that its next chapter of growth would take the bank out of Michigan for the first time in more than 50 years of history. The bank plans to open at least one, and possibly a second, branch in Minneapolis, the city in which Floyd was murdered.
Now, with the emergence of the FDIC fund, the potential investment should give the bank more flexibility, said Kelly, who added that the type of capital the bank could raise from the fund has yet to be done. been defined.
Overall, he said the new fund is part of the bank’s growth strategy.
“Well, what it does, it creates another vehicle that allows banks like ours to have the ability to pursue their business plans,” Kelly told Crain’s. “And so we think it’s positive that we now have another voice at the table, speaking on behalf of MDIs (and) recognizing that there is a need for patient capital that will allow these (banks) to thrive. and to be able to serve the communities that concern them a lot. ”