In December 2020, we announced a $20 million commitment to social impact investing as part of our efforts to help dismantle systemic racism through meaningful change across four key pillars - introspection, investment, inclusion, and impact. Today, we’re proud to continue our commitment to Black communities by investing the remaining $7.5 million in support of Minority Depository Institutions (MDIs) to help close the racial wealth, health, and opportunity gap.
The number of Black-led banks in the U.S. has been steadily declining, from 48 in 2001, to 20 in 2020. Due to this decline, Black communities have faced limited banking access and opportunity, which has created a racial wealth and funding gap. That’s why we’re making an investment to support two MDIs, M&F Bank and The Harbor Bank of Maryland, through J.P. Morgan Asset Management’s Empower share class, a new institutional money market share class created in February this year for exclusive distribution by Minority and Diverse-Led Financial Institutions.
"Through our conversations with MDIs, we’ve learned about their missions and the unique challenges they face in lending and gaining access to a recurring revenue stream,” said Kate Bueker, CFO of HubSpot. “We have a responsibility to our Black employees, customers, partners, and investors to help create more economic opportunities and we’re proud to partner with J.P. Morgan to help MDIs support the Black communities they serve and build a sustainable future.”
“The Harbor Bank of Maryland has a long history of providing capital and financial services to the communities that it serves,” said John Lewis, President and Chief Operating Officer of The Harbor Bank of Maryland. “We continue pushing forward on our mission to provide equitable access to financial resources. We are encouraged by our partners JPM Asset Management and HubSpot in furthering our efforts.”
Today’s news drives progress on our Black Lives Matter action plan and follows the first allocation of our social impact commitment, a $12.5 million investment in the Black Economic Development Fund. Managed by the Local Initiatives Support Corporation (LISC), the Fund has deployed $55 million in capital in support of Black-led financial institutions, anchor institutions, and businesses.
As our Chief People Officer Katie Burke noted in a summary of the progress we’ve made earlier this year, fighting racial injustice requires long-term commitment to make a lasting impact. To that end, we’re continuing to reflect on how to build a company future generations would be proud of and create opportunities for impact in our communities. We’re grateful to learn from our Black employees and Black Advisory Board and seek their feedback on how we can grow better as an inclusive company.