THE HUSTLE
Don't Hate the Player, Hate the Game
BANK ON BLACK Black-Owned Financial Institutions Vie for Your Savings
By Kristen Jones
Black-owned banks have played an important role in the African American community for many years, providing the economic assistance that many black people have desperately needed. Without these institutions, many black citizens would not have had a safe place to save their money; would not have been able to purchase houses, cars and other important items; and would not have been able to build businesses. Although the first Bank of the United States was established in Philadelphia in 1791, it didn’t serve the needs of blacks. To remedy this, President Abraham Lincoln established the Freedman’s Savings and Trust Company in 1865 to help serve freed slaves after the Civil War who needed banking services. Unfortunately, the company failed in 1874 due to faulty investment practices and corruption, which turned out to be a tragedy for those African Americans who had opened savings accounts there. Although some depositors ultimately got about 62 percent of their money back, more than half lost all of their savings. BAVUAL
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Early Black-Owned Banks On March 2, 1888, the first African American bank was finally founded. It was named True Reformers Bank and opened on April 3, 1889. William Washington Browne established the bank to serve the interests of African Americans and so that their finances would not be monitored by whites. Founded in Richmond, Virginia, it first operated out of Browne’s home and remained there for two years before moving. Even though it was the first blackowned bank chartered in the nation, the first one to open was the Capitol Savings Bank of Washington, D.C., which opened on Oct. 17, 1888. By 1906, there were more than 30 black banks, and the number continued to grow for years. These first black banks weren’t created merely to make a profit but rather to serve the community’s needs. They often provided lower-interest mortgage loans and programs to help those in need or who were unemployed—efforts that weren’t common in those days. SPRING 2023
