The National Bankers Association was founded in 1927. To serve as an advocate for the nation's minority and women owned banks on legislative and regulatory matters concerning and affecting our members and the communities they serve.
To maintain an information flow to our member banks relating to the sound and profitable operation of their banks.
To provide a forum for personal interaction between banks with similar problems and marketing opportunities.
To provide quality service at reasonable costs to our member banks.
To be eligible for membership a bank must share the common interest and concerns of the NBA and its members. Currently there are 50 member banks. Dues are based on total assets as of the end of the second calendar quarter of each year. Majority banks and members of their staff can join as "affiliate" members.
"Tell Them General, We're Rising"
"Tell them, General, we're rising." As a young man, R.R. Wright reportedly responded with those forcefully optimistic words to a question put to him in Georgia about the situation of African-Americans in the South after the end of the Civil War. A half-century later this same R.R. Wright, by then Major R.R. Wright and head of Philadelphia's African American-owned Citizens and Southern Bank and Trust Company, convened a meeting of Negro bankers. The date was September 15, 1926. The place, the Knights of Pythias Hall in Philadelphia. In 1927, when Major Wright was 72 years old, and a year after he initially called Negro bankers together, his determined and enduring optimism brought life to the Negro Bankers Association.
C.C. Spaulding, who in 1923 became President of North Carolina Mutual Insurance Company, and who also served as cashier of Mechanics and Farmers bank in Durham, North Carolina, joined Major Wright in creating this first formal national organization of minority bankers. Initial membership totaled 14 African American banks.
Observations about Major Wright's life underscore the man's energy and activism. In 1879, he represented Georgia at the first National Conference of Colored Men, held in Nashville. In 1896, President McKinley appointed Wright a paymaster in the army. From then on, he was known as Major Wright. From 1891 to 1921, Major Wright served as president of State College of Industry for Colored Youth in Savannah. He organized the Negro Civic Improvement League in Savannah, which upset the college's trustees and led Wright to leave politics and follow the path of Booker T. Washington in emphasizing Negro self-help and cooperative efforts with whites.
What led Major Wright to begin a new career as a banker was his desire to reverse high rates of attrition among Negro Businesses. At a time in life when most people were phasing themselves out of employment, Major Wright's activism drove him to pursue his apparent life-long battle to bring solid advancement to African Americans. Banking was Major Wright's weapon of choice.
Once Wright started the bank, he envisioned that speedier progress among an associaton of banks. But Wright also saw indifference and, worse, outright discrimination precluding alliances with non-minority banks. That's what drove Wright to create the Negro Bankers Association, an association of individiual African American banks compelled by the hard realities of the times to find creative ways to advance their communities and their banks.
Even before the death in 1933 of Wright's wife, his favorite companion, did not prevent him from continuing his leadership of the NBA. Nor did Wright end his quest to build Citizens and Southern. He not only undertook new initiative to attract depositors. He and his daughter, Harriet, started another business, Haitian Coffee and Products Trading Co. Major Wright was nothing less than a constructive activist par excellence. He was a true visionary, expressing very early his belief to leading non-minority bank and businesses that if they did not begin to hire African Americans, welfare costs would soar before they would fall.
Women, too, have deep roots in minority banking. African Amercian Maggie Lena Walker, born in 1867, started the Saint Luke Penny Savings Bank in 1903. She was the first women bank president in the U.S. Richmond's Consolidated Bank and Trust Company evolved from Saint Luke Penny Savings Bank. Walker led Consolidated from 1930 until 1934.
Walker was made of the same stuff as Major Wright and C.C. Spaulding. She, too, was driven to advance the well-being of African Americans. She realized that the Order of the St. Luke, of which she was Treasurer from 1899 until 1934, had to grow or die. Walker opted for expansion and life. By 1912, Saint Lukes' had almost 700 subordinate councils and more than 16,000 members in four states. Walker pushed her belief that African Americans must acquire skills and habits to achieve economic independence. Her concern for women led Walker to start the Richmond Council of Colored Women. As in the case of major Wright, Walker realized that financial strength held the keys to overall African American progress. That single focus motivated Walker's business decisions that ultimately led to the establishment of Consolidated Bank and Trust?
NBA - Born in a Hostile Time
The U.S. in the 1920s witnessed widespread discrimination. Congress passed anti-Asian immigration laws. The Klu Klux Klan, revived in Georgia in 1915, was a growing force in America. The 20's also saw the rise of Marcus Garvey and his Universal Negro Improvement Association. But these were extremely difficult times for America's minorities.
The 1920 census showed for the first time that urban population exceeded rural population. African Amercians formed a major part of the move to cities. Only in 1922 did the U.S. begin recovering from World War I demobilization. Recovery was slow, and uneven. The farm sector remained deeply troubled. GNP rose from $70 billion in 1922 to only $100 billion in 1929. Electricity was coming into wide use in factories, powering assembly line mass production. Autos underpinned economic growth in the 20's. Car registrations rose from eight million in 1923 to 23 million in 1930. But unions excluded African Americans. They had virtually no access to property ownership, housing, schools, or capital. Mainstream America feared African Americans for the reasons that they feared immigrates and immigration laws were passed that restricted Asian's, competition for jobs and wages.
This is the environment in which Wright and Spaulding started the Negro Bankers Association. To borrow from Stephen Ambrose's book on Lewis and Clark, Wright and Spaulding truly acted with Undaunted Courage. Founding of the NBA in such adverse times for America's minority bankers began a journey that has lasted longer than Lewis and Clark's exploration and surely has been every bit as threatening and uncertain. Indeed, NBA's journey continues today.
Working Through The Great Depression
Only one African American-owned Bank was founded during the Great Depression, Industrial Bank of Washington in 1932, which grew out of the Industrial Savings Bank of Washington. By 1943, when commercial banks in the U.S. totaled 14,621, records show only 11 as owned and operated by African Americans. Only four African American owned banks would form in the 17 years from the end of World War II to 1962.
The 40s began not much kinder to African Americans than the 20s had been. 17% of America's workers remained unemployed, an improvement from 1933 when 25% had no work. Of those with jobs in 1940, 50% of the men and two thirds of the women earned less than $1,000 per year. Only 48,000 U.S. taxpayers in a population of 132 million earned more than $2,500 a year.
Almost a third of America's 35 million homes lacked running water and indoor toilets. Almost 60% were without central heating. Fewer than 40% of adult Americans went beyond the 8th grade. Barely 25% finished high school. Only 5% had graduated from college.
But America was changing. Urbanization proceeded frenetically. That's where the war-time jobs were. More than six million African Americans and whites were on the move from the country to cities and from the south to the north in search of work. This astonishing migration compared with only 400,000 African Americans who migrated to northern cities during the heart of the depression. Yet even with mobilization for war production, African Americans and other minorities faced rampant discrimination. For example, President Roosevelt had to personally intervene to prevent discrimination by businesses engaged in production war-related goods.
African Americans suffered badly during the depression. It's not surprising that only one new African American owned bank came into being during the 30s. Roosevelt's "New Deal" agricultural policies unwittingly contributed to evictions of black tenant farmers. Minorities continued to confront unabated discrimination. The NAACP fought hard in courts and legislatures to protect and advance African Americans.
As the 40's began, the states of the old confederacy had almost 1,500,000 black farm workers in the rural labor force. All faced extreme poverty. By 1970, that number had plunged to 115,000.
NBA Positions for Growth
In 1948, the Negro Bankers Association, led by Milton Lorimer and Le Roy Ridley, made the strategic decision to change its name to the National Bankers Association. This strategy set the cornerstone for NBA's expansion and diversification, the major portion of which would begin about the time America was preparing to land a man on the moon. The NBA within the next three decades would extend its members' reach into minority communities throughout the country.
Growing U. S. prosperity brought African Americans little relief in the early 1950s. But underlying factors within American society were undergoing fundamental changes that would lead to subsequent and irreversible progress for all America's minorities and women. The Supreme Court's 1954 "Brown Decision" set in motion forces that brought to the forefront the energy, dynamism, and entrepreneurism of America's minorities and women. NBA was strategically positioned to be a driving force in advancing the economic interest of inner cities and minority communities throughout the land.
The 60's exploded with thunderous and wide concerns, chief among which was awareness among a larger and more influential portion of the U. S. populace of the stultifying inequality faced by America's minorities. This proved fertile ground for minority business executives and community activists who, like Major Wright, C.C Spaulding, and Maggie Walker realized greater equality would evolve from greater economic independence. What better way to advance minority economic progress than through ownership and control of commercial banking enterprises? The mid-to-late 60s commenced a 20-year growth spurt in the number of African American-owned banks, as it did for Hispanic-American, Asian-American, Native-American and women-owned banks.
The National Bankers Association, with its cornerstone for growth and diversity laid in 1948, was primed as a force in this growth of America's minority-owned financial institutions. Activist NBA leaders charged ahead. Advocacy of government at all levels become deft, professional and effective.
Activism Delivers Dividends
Skillful NBA leadership and initiatives resulted in significant support from the federal government. The Economic Development Administration and the Office of Minority Business Enterprise contributed to NBA's funding from 1968 until near the end of the 80's. Federal support fit into NBA's strategies promoting growth of the minority-banking industry.
Not only did NBA assist newly established minority and women-owned banks, it was instrumental in building government awareness of the needs of minority and women-owned financial institutions, and thus contributed to a flowering of many new banks. NBA simultaneously expanded its membership base. With more numerous and diverse membership, NBA's political and economic impact grew exponentially. NBA was instrumental in establishing as unassailable the concept that more minority-owned banks would speed and broaden truly sustainable development in inner-city and other minority communities.
Minority Banking Becomes A Growth Industry
When NBA decided to establish a national office, membership was only 20 banks with assets of $207 million and deposits of $185 million. The number of African American-owned banks jumped by 42 in the 17 years from 1962 to 1979. By 1972, assets of minority-owned banks reached $767 million.
Diversity of minority banking began in 1962, when Los Angeles based Cathay Bank became the first bank recognized as Asian-American. Centinel Bank of Taos, New Mexico followed in 1969 becoming the first US-mainland-based Hispanic bank. (Banco Popular de Puerto Rico, headquartered in San Juan, is more than 100 years old.) In 1971 American Indians started their first bank, Lumbee Bank of Pembroke, North Carolina. And in 1975, New York City became the home of First Women's Bank of New York.
NBA's Strategy of Broadening and Reaching Out
NBA viewed assistance from the federal government as a bridge to help minority banks continue the journey they began in the 1920s. NBA's next destination was corporate America.
In 1980, with alliances long established with some of America's most successful and influential firms, NBA worked to establish a Corporate Advisory Board. The CAB, as it came to be called, has proved a vital, reliable and enduring friend of NBA. Together, NBA and CAB constructed NBA's Corporate Advisory Group (CAG), which today consists of treasurers of some 70 Fortune 500 companies.
NBA's partnerships with the CAB and the CAG firms was another break-the-mold strategic step by NBA that has paid tremendous mutually beneficial dividends. By 1989, CAB and CAG credit lines with NBA banks reached $430 million.
By 1985, NBA membership reached 45 banks, including 36 African American-owned banks, five Hispanic American-owned, three women-owned, and one East Indian-owned. Membership had more than doubled since NBA strategy called for establishing a national office.
By 1987, 91 minority-owned banks existed. By 1989, NBA had an ethnically diversified base of 60 dues paying members, with 38 affiliate and associate members.
Within a 10-year period, 1972-1982, deposits in minority and women-owned banks had climbed to $3.1 billion. Assets equaled $3.6 billion. Total assets jumped again over the next five-years, reaching $6.6 Billion by 1987. Minority banks then operated in more than 100 U. S. cities with an employee base approaching 5,000.
Today, NBA member banks number 50. There are 33 Affiliate and Associate members. NBA banks operate in 29 state, two territories and 60 cities. Minority and women-owned banks today employ more than 15,000, have assets in excess of $31 billion and have more than 3,000,000 depositors.
NBA pursues an activist course on several fronts, certainly in keeping with the legacies of pioneering minority bankers like Major Wright, C.C. Spaulding and Maggie Walker. Member services involved top-caliber legislative and regulatory representation and an informative newsletter "The Monitor". NBA Today Magazine is published annually and NBA sponsors several knowledge-building events a year beside it annual convention.
Since 1989, NBA's CAB and CAG relationships have grown substantially. More than 200 of the Fortune 500 Companies do business with NBA banks, generating $630 million in lines of credit and $10.3 billion in non-credit services.
NBA helps members build both corporate and government relationships, through innovative programs like the Kellogg/NBA CD program and the U. S. Department of Energy Bank Deposit Financial Assistance Program. NBA also offers scholarship fund participation and the NBA/ICBA credit card and securities.
Successes in Washington number many from the inception of the government-wide Minority Bank Deposit Program to passage in 1987 of the "Minority-and-Women-Bank" priority in a failed or failing-bank situation. NBA played a major role in legislation that kept above the Energy Department's relationships with minority and women-owned banks. In 1992, NBA was instrumental in the Federal Financial Institutions Examination Council's (FFIEC) procedures whereby non-minority financial institutions receive favorable CRA consideration for Capital investments, loan participation's and other co-ventures with minority and women-owned banks.
Here Comes 2000
There are probably 2000 questions that NBA leaders and members will ask themselves as the calendar passes to the year 2000 and beyond. What course will NBA chart in the new Millennium? Thirty one (31) individuals, from Major Wright in 1927 to James Young today, have been elected to lead NBA. Where will future NBA leaders take the organization?
Certain paths seem defined. NBA will surely continue its successful alliances with FannieMae, the Department of Energy, and the firms involved in the CAB and the CAG. Will NBA broaden relationships and outreach to include colleges and universities like Columbia or Trinity, with its innovative and aggressive "Frog Hollow" initiatives in Hartford or with the University of Southern California inner-city educational drive?
Technology will continue to play an increasingly influential role in how every business pursues its economic livelihood and competitive advantage. How will NBA opt to advise and guide its members as technology forces its way into every nook and cranny of how people and businesses live their lives?
Politics, too, will endure in development in inner cities as long as elections can be won and lost by minority voters. That's why the Clinton campaign deposited $5 million in four banks owned by Hispanics and African-Americans. How will NBA banks position themselves to take advantage of political interests? Can they position so as to build their own financial resources in ways that also work for their communities? And how will the NBA of the future handle more government engineered competition, like today's community development banks?
NBA banks sit at the gateways of minority communities. They hold important keys to $900 billion in purchasing power of America's minorities. Every consumer goods and services corporation in the world would like to know how to unlock minority consumers' pocketbooks. NBA banks understand the goods and services that create value for businesses and consumers in their communities. Will NBA members take advantage of this natural positioning and build even more expansive corporate alliances, both domestically and internationally?
NBA banks will continue to lead the way for competitive development in their communities by distinguishing themselves through their deftness in adopting competitively innovative approaches to provide service, more and better service. And minority and women-owned banks will face in the new millennium a financial services environment that seems certain to involve more marketplace, regulatory and legislative turmoil?
Let the journey continue!