A Black investor group announced last week that they agreed to purchase Utah-based Holladay Bank and Trust, a historic deal where an existing commercial bank would become a Black-owned Minority Depository Institution (MDI) for the first time in the United States.
Redemption Holding Company (RHC) announced the plans to purchase the Utah-based bank on Feb. 28 and said in the announcement that if the plans get federal regulatory approval, the deal “will reverse a negative trend a half-century in the making for America’s Black-owned banking sector.”
According to the announcement, the U.S. had 50 Black-owned banks across the country in 1976, but that number has dropped significantly in recent years. In 2022, there were only 16 banks left, according to the Federal Deposit Insurance Corporation (FDIC). If approved, RHC will become the 17th Black-owned bank in the U.S. today.
According to the FDIC, a MDI is an institution where minority individuals make up 51 percent or more of voting stock, or when a majority of the board of directors are minority individuals and the community the institution serves is also predominantly a minority community.
Ashley Bell, a former Trump adviser and small business administration regional administrator, will be RHC’s executive chairman and chief executive officer.
“Black banks make the American dream possible for all Americans by deploying resources that uniquely address the financial realities of communities that have been systematically excluded, overcharged, and under-capitalized for hundreds of years,” Bell said in a statement.
“Redemption will serve as a lifeline to the next wave of Black and Brown first-time home buyers and small business entrepreneurs across the country,” she added.
Martin Luther King’s daughter, Bernice King, and retired NFL player Dhani Jones are both investors and will also serve on the company’s advisory board.
“In my father’s last public address on April 3, 1968, he preached the imperative to accelerate the financial inclusion of Black Americans by supporting mission-driven Black banks—something he called a ‘bank-in movement,'” King said in a statement.
“More than half a century of struggle and incremental progress later, we’re making good on daddy’s call to bank-in by creating new centers of opportunity for people of color, starting with this Black-led bank acquisition. Redemption is just that: delivering families from the cycle of unjust financial exclusion and intergenerational poverty,” she continued.