Black-Owned Banks In America: A State-by-State List (2024)

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According to the Federal Reserve, Black people are two times more likely to be denied credit than their white counterparts—regardless of income level. This discriminatory practice, also known as redlining, has contributed to disparities in wealth between Black and white households.

To combat this inequality, Black-owned banks have emerged across the U.S., providing economic security for disenfranchised Black communities that have long been underserved by financial institutions.

How Many Black-Owned Banks Are There in America?

According to FDIC data, only 23 out of 5,400 insured financial institutions in the United States were owned and operated by Black people as of 2018.

The number of Black-owned banks in America has declined over the past two decades, decreasing by more than 50% from 2001 to 2018. The 2008 financial crisis was particularly damaging to the income level and employment rate of Black Americans and led to the dwindling of Black-owned banks.

Black-owned banks have far fewer assets at their disposal than major players in the banking industry. OneUnited, the largest Black-owned bank in the U.S., manages around $625 million in assets. In comparison, Bank of America manages nearly $2.5 trillion.

Who Owned the First Black Bank?

Rev. William Washington Browne, a former slave and Union Army officer from Georgia, founded the first Black-owned bank in America—True Reformers Bank—on March 2, 1888. The name of the bank was inspired by the Grand Fountain United Order of True Reformers, a Black fraternal organization established by Browne.

Browne formed True Reformers Bank when his fraternal organization encountered problems while attempting to establish a local branch in Virginia. The branch arranged to keep its savings in the safe of a white storekeeper. However, with racial tensions running high after a lynching in Charlotte County, white locals were suspicious and paranoid about what the organization planned to do with the funds.

To avoid having the organization’s finances managed and scrutinized by white people, Browne decided to open a bank serving Black customers in Richmond, Virginia. After his death in 1897, the bank continued to thrive and operate in over 20 states.

However, problems arose when the bank’s new president, Rev. William Lee Taylor, failed to manage and regulate each branch properly. In 1910, Virginia’s State Corporation Commission officially ordered the closure of True Reformers Bank.

What Makes a Bank Black-Owned?

Black-owned banks are depository institutions where Black people own 51% or more of the stock. These financial institutions are typically located in communities of color and provide a source of local economic support.

Black-owned banks typically focus on lending to Black homeowners, small businesses and nonprofit organizations like churches. And though these banks focus predominantly on Black communities, non-Black individuals and companies are welcome to become customers. Opening an account with a Black-owned bank as an ally can be a great way to support its mission of closing the wealth gap in America.

Why Switch to a Black-Owned Bank?

Black-owned banks work to provide fair and equal services and uplift Black businesses, homeowners and entrepreneurs in ways that major white-owned banks are often unable to. By depositing funds in Black-owned banks, you empower them to lend more funds to African American-owned businesses, further creating opportunities for employment, mentorship and educational advancement in the Black community.

By switching to a Black-owned bank, you help level the playing field for Black consumers who have been underserved by financial institutions and continue to lag behind other segments of the population. The median white family in the U.S. had 7.8 times the wealth of the typical Black family as of 2019: $188,000 compared to $24,100, according to the Brookings Institution.

List of Black-Owned Banks by State

We compiled a list of Black-owned banks across the U.S. so you can support these financial institutions and help build wealth within the African American community. Note that not every state has a Black-owned bank with physical branch locations.

Find The Best Online Banks Of 2024

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Black-Owned Online Banks

Black-owned online banks offer similar benefits to traditional brick-and-mortar financial institutions and are available to Americans nationwide. Open an account with an online Black-owned bank if you can’t find a brick-and-mortar bank in your area.

Be sure to perform your due diligence and comparison shop to find the best option for your needs.

I'm a seasoned expert in the field of finance, particularly with a focus on banking practices and disparities within the industry. My in-depth knowledge extends from historical events, such as the 2008 financial crisis, to the intricate workings of banking institutions in the United States. My expertise includes understanding the impact of discriminatory practices like redlining and their contribution to wealth disparities between different racial communities.

Now, let's delve into the concepts mentioned in the provided article:

Black-Owned Banks and Disparities: According to the Federal Reserve, discriminatory practices like redlining persist, with Black individuals being twice as likely to be denied credit compared to their white counterparts, irrespective of income levels. This has resulted in significant wealth disparities between Black and white households.
Number of Black-Owned Banks: The article cites FDIC data, stating that as of 2018, there were only 23 Black-owned banks out of 5,400 insured financial institutions in the U.S. This number has declined by over 50% from 2001 to 2018, with the 2008 financial crisis playing a detrimental role in the reduction of Black-owned banks.
Assets Disparity: Black-owned banks, exemplified by OneUnited as the largest in the U.S., manage significantly fewer assets compared to major white-owned banks. For instance, OneUnited manages around $625 million in assets, while Bank of America handles nearly $2.5 trillion.
Historical Perspective - First Black-Owned Bank: The article provides historical context by mentioning the first Black-owned bank in America, True Reformers Bank, founded by Rev. William Washington Browne in 1888. The bank was created in response to racial tensions, allowing Black customers to have financial services without scrutiny from white individuals.
Ownership Criteria - What Makes a Bank Black-Owned: The definition of a Black-owned bank is clarified as a depository institution where Black people own 51% or more of the stock. These banks primarily operate in communities of color, providing economic support and focusing on lending to Black homeowners, small businesses, and nonprofit organizations.
Wealth Gap and Support for Black-Owned Banks: The article emphasizes the importance of supporting Black-owned banks to address the wealth gap. By depositing funds in these banks, individuals can empower them to provide more financial support to African American-owned businesses, contributing to opportunities for employment, mentorship, and educational advancement in the Black community.
List of Black-Owned Banks by State: A comprehensive list of Black-owned banks across the U.S. is provided, organized by state. These banks serve as a means to support economic growth within African American communities.
Online Black-Owned Banks: The article introduces the concept of Black-owned online banks, such as Greenwood, MoCaFi, and OneUnited Bank. These online banks offer similar benefits to traditional brick-and-mortar institutions and are accessible to Americans nationwide.

In conclusion, the article sheds light on the historical context, current challenges, and the crucial role Black-owned banks play in addressing wealth disparities and promoting economic empowerment within the African American community.