As the conversation around racial equity and inclusion in our society and across industries has gathered momentum in recent months, a number of financial institutions have initiated efforts to empower minority communities. We are proud to say that Citi has been active in this area for years and recently announced Action for Racial Equity, a major effort to help close the racial wealth gap that includes a focus on strengthening the economic trajectory of minority-owned and women-owned banks and the communities they serve.
One of the most important ways in which we have done this is by working with the U.S. Department of the Treasury to design a Financial Agent (FA) Mentor-Protégé Program in 2018. The Program pairs FAs with minority-owned and women-owned banks, opening up a valuable long-term source of revenue. Doyle Mitchell Jr., President and CEO of Industrial Bank, the first bank that Citi partnered with on the Mentor-Protégé Program – the first and only minority bank to be awarded an opportunity to support a Federal government contract – neatly summarizes the impact of the partnership initiative. He credits participation in the program with opening doors for the bank that would otherwise be closed, and – most importantly – enabled the bank to keep the doors open for its community.
However, for Citi the FA Mentor-Protégé Program was just the start of a long journey. Two years in, the Program has evolved beyond working with banks to help them qualify as FAs. We recognized that while access to government business opportunities is important, it is not enough. Through our conversations with the leadership teams at our Protégé banks, it became clear to Citi that minority-owned and women-owned banks also need capital and would benefit from more extensive support and access to our expertise across a number of key areas.
In response, we have created opportunities for loan participations and increased banks' access to technology, training, talent development and CEO mentorship. Overall, the program is now focused on building the long-term financial, technological and employee capabilities that can enable these banks to grow. We are evaluating white labeling technology so that banks can offer their clients the functionality they need. Additionally, Protégé banks have access to Citi senior executives for advice and support in a way that would never normally be possible. Our goal is to support minority and women owned banks to accelerate their transformation agendas and in turn reach deeper into the communities they serve
Delivering tangible long-term benefits
Seeing what the Program means in practice is inspiring. When I sat down with Laurie Vignaud, President and CEO of Unity National Bank, she explained how working with Citi had transformed their business, enabling them to hire people and attract new customers.
The Program has also delivered meaningful benefits for partner banks during the COVID-19 crisis. Citi was actively involved with the Paycheck Protection Program (PPP), supporting the government in its provision of incentives for small businesses to keep their workers on payroll. Our involvement with minority-owned and women-owned banks enabled us to channel PPP funding to the companies that needed it most and provided effective support to the communities where they operate.
We initially developed the Mentor-Protégé Program as a client solution, assisting the U.S. Department of the Treasury to achieve its goal of working with a greater number of minority-owned and women-owned banks. However, we have deepened and broadened our partnerships with these banks because we believe that all financial institutions have a responsibility to society. Citi – as one of the world's largest – feels this responsibility deeply.
More needs to be done – the entire industry needs to act to empower minority communities. But Citi has recognized the scale of the problem, allocated resources accordingly, and is working to help minority-owned and women-owned banks create a long-term sustainable future, for all our communities.
We are committed to working with minority depository institutions and community banks, determining creative and non-standard ways of supporting future growth.