Two Black-Led banks, City First in Washington, DC and Broadway Financial Corporation in Los Angeles, CA announced they have entered into a transformational Merger of Equals agreement to create the largest Black-Led bank in the nation with more than $1 billion in combined assets under management and approximately $850 million in total depository institution assets.
The merger will increase their collective commercial lending capacity for investments in multifamily affordable housing, small businesses, and non-profit development in financially underserved urban areas while creating a national platform for impact investors.
Black-owned and led banks have long been caught in a difficult cycle and tend not to have enough money to lend to help their communities build wealth, resulting in the shortage of wealth-building opportunities diminishes the money available to flow into the banks.
Brian E. Argrett, chief executive of City First, will be chief executive of the combined company, which will use City First as its banking brand but keep the publicly traded Broadway Financial Corporation as its bank holding company. Wayne-Kent A. Bradshaw, Broadway’s chief executive, will be the chairman of the combined company.
Broadway and City First are Community Development Financial Institutions (CDFIs), and have a longstanding history of advancing economic and social equity through the provision of capital in low- to moderate-income communities. The combined institution will maintain its CDFI status, requiring it to deploy at least 60% of its lending into low- to moderate-income communities
Since the beginning of 2015, City First Bank and Broadway Federal Bank have collectively deployed over $1.1 billion combined in loans and investments in their communities
“Given the compounding factors of a global pandemic, unprecedented unemployment and social unrest resulting from centuries of inequities, the work of CDFIs has never been more urgent and necessary,” said Brian E. Argrett. “As part of this historic merger, we are demonstrating that thriving urban neighborhoods are viable markets that require a dedicated focus, long-term commitment and critical access to capital.”
“The new combined institution will strengthen our position and will help drive both sustainable economic growth and societal returns,” said Mr. Bradshaw. “We envision building stronger profitability and creating a multiplier effect of capital availability for our customers and for the communities we serve.”
The new institution will maintain bi-coastal headquarters and will continue to serve and expand in the banks’ current geographic areas, with a desire to scale to other high-potential urban markets.
About CFBanc Corporation
City First conducts its operations through its wholly owned subsidiary, City First Bank. Founded over 25 years ago in direct response to systemic disinvestment in our communities, City First has been an innovator and a financial first responder for equitable economic development in Washington, DC. Together with our affiliates, City First has since invested over $1.3 billion as of June 30, 2020 with a vision to advance economic equity and social justice, impacting families and communities today and for generations to come. City First is part of a dedicated network of CDFIs and certified BCorps, and is a member of the Global Alliance of Banking on Values, entities whose values are aligned with sustainable solutions, healthier families and more prosperous communities for our collective well-being.
About Broadway Financial Corporation
Broadway conducts its operations through its wholly owned subsidiary, Broadway Federal Bank, which is the leading community-oriented savings bank in Southern California serving low-to-moderate-income communities. Broadway Federal Bank offers a variety of residential and commercial real estate loan products for consumers, businesses and nonprofit organizations, other loan products and a variety of deposit products, including checking, savings and money market accounts, certificates of deposits and retirement accounts. Broadway Federal Bank operates three full-service branches, two in the city of Los Angeles, and one located in the nearby city of Inglewood, California
