6/14/21
Crain’s Detroit Business
By Nick Manes
- Fifth Third announces new $2.5 million investment in Black-owned First Independence
- Follows $3 million investment in 2008
- Larger banks increasingly taking investment positions in minority banks
First Independence Bank, among the nation’s largest Black-owned banks, continues to receive interest from larger lenders amid calls for more economic equity.
The Detroit-based First Independence, a minority depository institution and community development financial institution (CDFI), has received a follow-investment of $2.5 million from a community development subsidiary of Fifth Third Bancorp., according to a news release. The investment, announced on Monday, brings the Cincinnati-based Fifth Third’s total investment in First Independence to $5.5 million since 2008, according to the release.
Federal regulators define a minority depository institution like First Independence as being a federal insured depository institution in which at least 51 percent of the voting stock is owned by minority individuals; or a majority of the board of directors is minority and the community that the institution serves is predominantly minority.
The Detroit-based lender can use the funds from Fifth Third to invest in personnel, technology and physical assets.
“CDFIs are critical to creating and preserving wealth in minority communities,” Kala Gibson, Fifth Third Bank’s head of business banking and chief enterprise corporate social responsibility officer, said in the release.. “It is imperative that larger financial services institutions support these organizations to ensure their viability and longevity.”
First Independence Bank had $323.76 million in assets as of March 31, compared with Fifth Third’s $205.5 billion and 1,100 branch offices in 11 states, according to federal regulatory filings.
Fifth Third executives say in the release that this added investment makes the bank the largest investor in the smaller bank.
“We are proud to strengthen our partnership with Fifth Third Bank through this additional investment. The confidence shown in First Independence Bank will allow us as a minority depository institution to further strengthen communities that we have served for more than 51 years,” Kenneth Kelly, chairman and CEO of First Independence Bank, said in the release. “The courage of the leadership team at Fifth Third to increase their investment in First Independence Bank is the epitome of speaking about inclusion and demonstrating inclusion in a tangible manner.”
Other large banks, such as Comerica and Bank of America, have also announced investment positions in First Independence, as Crain’s has previously reported .
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