Community Development Banks

Community Development Banks are not just your average run of the mill bank. There are several differences between Community Development Banks and typical financial institutions. As the name implies, Community Development Banks (often referred to as CDB’s) have the goal of assisting the community they are located in. Community Development Banks are only placed in areas that are considered of low-to-moderate income (referred to as LMI), and they are placed to help the residents and to increase the economic development of those communities.

Community Development Banks typically offer most of the same services of regular banks, but they only offer them to people who are of a certain income class, helping to heighten their financial well-being. Often, these services may be free or cheaper than those of other banks. A bank can only be considered a Community Development Bank if it has been formally certified as such by the U.S. Department of Treasury. The division that certifies Community Development Banks is called the Community Development Financial Institutions Fund, and the bank has to meet certain criteria and set certain goals and plans of action before it can be certified. Community Development Banks, like any national bank, are federally chartered and are regulated by the OCC (Office of the Comptroller of the Currency).

There are many Community Development Banks all across the United States, and there may even be one in your area. In the Western part of the country, Community Development Banks include Neighborhood National Bank in San Diego and Albina Community Bank in Portland. In the Midwestern part of the States, you can find Louisville Community Bank, University National Bank in St. Paul, Minnesota and Central Bank of Kansas City. The southern United States features two banks in New Orleans, including Dryades Savings Bank and Liberty Bank and Trust, as well as Southern Bancorp in Arkadelphia, Arkansas. The eastern part of the country boasts City First Bank of D.C. and Carver Federal Savings Bank of New York City.

As you can see, there are many Community Development Banks located all across the country that are in place to help their communities develop. These banks work toward lending a hand to the people of their LMI locations, as well as commit to investing in their locales. This allows for families who would otherwise be left without investment and banking opportunities a way to financially better themselves using their local Community Development Bank.