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A Search for an Honorable Bank

Theresa Deibele
On Alternatives (March 2022)
Healing the World

About a year ago, Multnomah Monthly Meeting in Portland, Oregon, asked all of its committees to examine how their work might be upholding or breaking down structural racism. For our Finance Committee, one aspect that was specifically raised and addressed was the choice of a better banking partner.  Over the summer of 2021, we researched banking alternatives with the hope of finding a partner more aligned with our Quaker values, as well as working to advance racial justice.

The financial sector is not known for its leadership on social issues. Indeed, legal and economic systems are key pillars in structural racism and have little incentive to change. On the contrary, they profit from extraction and inequity. Still, we sensed that we could do better in finding a bank with an alternative ownership structure, one that would be more grounded in and accountable to its community.

Ever since we announced that we planned to change banking partners, many folks in our meeting have approached us to say they are considering switching banks for personal or business purposes and asked to hear more about our discernment process.  Members of our meeting are working actively with others to become antiracist, so we find that the questions we have been asking in this discernment process are every bit as important as the decision that we made.

Some background: Many years ago, Multnomah Monthly Meeting banked with Columbia Bank, which was headquartered in Tacoma, Washington. We were unhappy with the service, so with time and effort, we moved our funds to Pacific Continental Bank out of Eugene, Oregon, only to then have Pacific Continental merge into Columbia Bank in 2017. Alas, we were back with Columbia Bank. And since the process of switching banks is quite cumbersome and our committee had other pressing priorities, we stayed with Columbia.

Five years later, we were charged by our meeting to examine the racial-justice impacts of our practices.  We began that process by developing a set of criteria for assessing different banking alternatives:

Does the institution offer the services and features we need? These include electronic ACH payments, online banking, credit and debit cards, and other savings or money-market options. For us, this was the single most important factor. If the financial institution didn’t offer the business features we needed, we would not move forward with them.

How many locations do they have, and would those be accessible to people who might serve on the treasury team, now and in the future? This consideration was also critically important, since our meeting’s treasurer, assistant treasurer, hearthkeeper, and other committee members all live in widely dispersed locations throughout Portland and the surrounding counties. We need many convenient branches. This would not likely be a factor for someone considering their personal banking, but it is very important for our mostly volunteer operation.

Are they owned or operated by Black, Indigenous, or other people of color? We looked closely at the ownership structure and leadership of each institution we considered. A bank or credit union can apply for federal designation as a Minority Depository Institution (MDI), which means it is owned or directed primarily by Black, Indigenous, or other people of color. We quickly found that Oregon has no Black-owned banks or MDIs chartered here, except for OneUnited, an online bank. Since we need to make cash deposits and other in-person transactions, an online bank isn’t a viable choice for us.

How does the bank serve low-income communities? Some banks and credit unions are accredited for serving low-income communities, based on an evaluation of the services they provide to communities neglected by traditional banks.

What types of lending does it do? We wanted to work with a banking partner that supports wealth-building opportunities with its customers. That is, we were looking for institutions that make loans for small-business development and home purchases, not ones that merely offer consumer loans or credit cards.

How involved are they in local community affairs?  We wanted to find a community-focused bank that supports local events, nonprofits, scholarships, and social justice causes in our area.  

How do they demonstrate a commitment to being anti-racist? We wanted to see a clear commitment to racial justice, looking at how the bank connects with the community, expresses its values, speaks up on issues of injustice, and takes affirmative steps to be an anti-racist organization.

How are they accountable to the community? It is important to see that the local owners, board members, and staff reflect community demographics. We considered that would be one good sign of community accountability.

We found the website “Better Banking Options” to be a helpful resource in our research. A public education project of the financial advising firm Just Money Advisors, Better Banking Options has the purpose to “bring capital into neighborhoods neglected by traditional banking.” The website has all kinds of filters to find the banking options that align with different social-justice criteria.

After we identified our criteria, we considered a list of banks and credit unions against those criteria and narrowed the list down to four options, which we researched in more depth: Advantis Credit Union, Beneficial State Bank, Consolidated Community Credit Union, and OnPoint Credit Union. Pretty quickly, two of those options rose to the top – Beneficial State Bank and OnPoint Credit Union – because they are large enough to offer the services we need, have multiple branches, and demonstrate some commitment to racial equity and social justice.

Beneficial State Bank opened in 2007 and has seven branches across Oregon, Washington, and California. We really liked Beneficial’s strong commitment to environmental issues. In the energy sector, it funds clean, renewable energy, and will not fund coal, oil, gas, or other dirty energy businesses. Beneficial also has “mission targets” for lending, aiming at least 75% of their loan dollars toward endeavors, businesses, nonprofits, and individuals who are producing sustainable and socially just goods and services. Additionally, none of the bank’s lending can be “contra mission.” That is, no loans can go to projects that do harm or undermine the bank’s social benefit goals. Beneficial publishes “statements of solidarity” that promote a more equitable world. It also publishes third-party-audited, data-driven metrics in its Annual Impact Reports.  On the other hand, the bank’s ownership structure was a challenge for us. The structure is unusual – a for-profit bank owned by a nonprofit foundation. Also, because Beneficial serves several urban areas along the West Coast, we weren’t sure how well connected it is to efforts in our local community.

OnPoint Credit Union started as a teachers’ credit union in 1932 and now has 458,000 members, making it the largest nonprofit credit union in Oregon. It definitely has all the services we need, as well as numerous branches (28) around the Portland metro area, which should make it convenient to all our current and future volunteers. We also like OnPoint’s strong community-giving program – donations that focus on education, climate justice, human services, and initiatives to promote diversity, equity, and inclusion. We noticed it invested over half a million dollars in 2020 to support key Black-led institutions, including the Black United Fund, Self Enhancement, Inc., and Urban League of Portland. And although we were not impressed by the lack of diversity in OnPoint’s leadership team, we did notice better diversity in its board of directors. Also, OnPoint appears to be taking active first steps in articulating plans to address structural racism. Overall, we admired the transparency and humility that OnPoint demonstrated in its community impact statement. In the end, we chose to move our business to OnPoint, because we felt its values are the closest match to our own.  It was also helpful to learn that North Pacific Yearly Meeting has moved its banking to OnPoint.

The work to undo systemic racism and colonization belongs with every Quaker meeting and every Quaker committee. We can always benefit from seeking alternatives to our current practices, so that our actions continue to become better aligned with our values. Choosing a better bank took time and it was messy, but we found the process to be meaningful. And we’re glad we made the move when we did. Our previous bank just entered into yet another merger!   ~~~

For a list of resources consulted in this project, see: https://westernfriend.org/media/resources-on-banking

Theresa Deibele works at the intersection of people and money, seeking ways to use capital as a tool for empowerment and social justice. She currently serves as Treasurer for Multnomah Monthly Meeting (NPYM).

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