Flagstar Commits $600M to I.E.
Bank commits to community development and services for low-income families
Michigan-based Flagstar Bank is acquiring Desert Community Bank in California, establishing its footprint in San Bernardino County. As part of this acquisition, Flagstar worked closely with the California Reinvestment Coalition, the Greenlining Institute, and local members to negotiate Community Agreements that meet the gold standard for bank investments, lending, and services in communities of color and low-income communities, committing $600 million to local community investments. Bank agreements of this type are rare, and this agreement is a credit to Flagstar’s commitment to community development, and the hard work of local partners.
“We are excited about teaming up with the California Reinvestment Coalition and the Greenlining Institute to make Flagstar’s acquisition of Desert Community Bank a win for the new communities Flagstar will serve in San Bernardino County,” said Alessandro DiNello, president and chief executive officer of Flagstar Bank. “We share their interest in ensuring the underserved have full access to our lending, banking and investment services, and we appreciate the opportunity to work with them in crafting an agreement that elevates and prioritizes community needs.”
As part of these agreements, Flagstar will annually invest approximately 20% of the DCB network total deposits over the next five years in activities such as community development, mortgages for low-income families, small business loans, low-fee checking accounts, and services for immigrant customers. Flagstar will also explore opening three branches in underserved neighborhoods, creating a formal supplier diversity program, and prioritizing employment opportunities within the local communities. Flagstar has agreed to release data on benchmarks and meet with the community annually to track progress.
“Community support and the input from our members was critical,” said Paulina Gonzalez, the Executive Director of the California Reinvestment Coalition. “We are grateful for their work to make sure that Flagstar Bank will serve Inland Empire communities and provide access to products and services that low- and moderate-income families and communities of color in San Bernardino need.” The members who were involved in the process were the Fair Housing Council of Riverside County, Neighborhood Partnership Housing Services, Springboard CDFI, Springboard Social Enterprises Credit.org, Neighborhood Housing Services of the Inland Empire, Inland Fair Housing and Mediation Board, and Coachella Valley Housing Coalition.
“We’re delighted that Flagstar bank has made a real commitment to the San Bernardino area’s low-income communities and communities of color. Flagstar’s investments will mean mortgages for low-income families, small business loans, low-fee checking accounts that working families can afford, and more,” said Orson Aguilar, President of the Greenlining Institute. “We’re excited to work with them in coming years to turn this commitment into real help for the community.” Greenlining partners who were involved in the process were the Asian Business Association Inland Empire, National Latina Business Women Association of the Inland Empire, Am Pac, and the Southern California Black Chamber of Commerce.
For more information on the Community Reinvestment Act and economic equity, visit http://www.calreinvest.org/crc-issues/community-reinvestment-act or http://greenlining.org/issues-impact/economic-equity/.