*M&F Bank and The Harbor Bank of Maryland are two Black banks trending and smiling their way to the ‘bank’ after receiving a total of $7.5 million investment from HubSpot.
HubSpot, the self-proclaimed customer relationship management (CRM) platform, explains that the amount is the final of the $20 million social impacts investing commitment set aside to support the Minority Depository Institutions (MDIs).
HubSpot aims at eliminating systemic racism against Black communities through investment, introspection, impact, and inclusion. The investment exclusively supports the two banks via the J.P. Morgan Asset Management’s Empower share class. Besides, a new institutional money market share class exclusively designed to support minority and diverse-led financial firms was launched in Feb 2021.
J.P. Morgan, with the help of the share class, will handle all the administrative and back-office duties besides training and mentoring the MDIs.
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According to HubSpot, the attending MDIs will gain a higher revenue share on the management fees charged on the accounts. The proceeds will allow them to gain a constant income stream free of the regulatory limitations of making huge deposits into their banks. In the end, they will be capable of better community service.
The two institutions are also on the BE Banks list as America’s biggest Black-owned banks. They will receive a 50-50 split amount, which they will use to improve their banking services. As for the revenue generated from the share class program, HubSpot recommends using it to increase its lending capacity to Black-owned businesses and individuals.
HubSpot offers an ideal chance for Black banks to do better by offering significant financial support and, in the end, safeguard them from possible shutdowns.
“The Harbor Bank of Maryland has a long history of providing capital and financial services to the communities that it serves,” explains John Lewis, the current president and chief operating officer. “We continue pushing forward on our mission to provide equitable access to financial resources. We are encouraged by our partners JPM Asset Management and HubSpot in furthering our efforts.”
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