Bank of America Adds $100M in Low-Cost Deposits to Minority-Led Banks

Bank of America is adding $100 million in low-cost deposits to minority depository institutions (MDIs), doubling its existing $100 million in deposits in MDIs.

With these low-cost deposits, MDIs can expand their lending capacity and other banking services in minority and low- to moderate-income communities, Bank of America said Tuesday (Oct. 4) in a press release.

“It is well recognized that MDIs are a critical resource to minority and underserved communities by providing banking services, creating jobs and helping businesses grow,” Bank of America Chief Administrative Officer D. Steve Boland said in the release. “As a founding member of the Economic Opportunity Coalition, we are committed to finding innovative ways to scale and expand the reach of our capital to provide access to economic opportunities and support diverse communities across the country.”

Beyond the low-cost deposits, Bank of America has made $42.5 million in equity investments in 22 MDI and Community Development Financial Institutions (CDFI) banks, according to the release.

The deposits join other investments made in MDIs by Bank of America, other institutions and the U.S. Department of Treasury’s Emergency Capital Investment Program (ECIP), the release stated.

For example, Visa announced in February that it was launching a multi-year program called Visa Minority Depository Institutions (MDI) Accelerate that included investing in MDIs to assist them in generating lending as well as providing the banks with actionable insights and digital solutions to help them meet the needs of the communities they serve.

Read more: Visa Launches MDI Accelerate Program to Back Minority-Led Banks

Visa Chief Diversity Officer and Head of Corporate Responsibility Michelle Gethers-Clark said in a Feb. 23 press release: “We believe MDIs play a critical role in improving economic outcomes and are proud that Visa MDI Accelerate will advance our shared goal of uplifting everyone everywhere.”