The U.S. House of Representatives recently passed legislation that would codify the Financial Agent Mentor-Protégé Program at the U.S. Department of the Treasury.
The program pairs small and rural financial institutions with large banks and credit unions to give the smaller financial institutions access to resources, training and technical assistance. This helps them better serve their communities and become Financial Agents to the Treasury.
There are 151 Minority Depository Institutions in the United States, a more than 30 percent decrease since 2008. The institutions generally have much higher expenses and often merge with other minority-owned banks to survive.
“Small financial institutions serve as the backbone of local economies nationwide, delivering essential resources like mortgage credit, small business capital, and trusted banking services that help neighborhoods thrive,” U.S. Rep. Joyce Beatty (D-OH), who introduced the bill, said. “These institutions know the people they serve best and they are uniquely positioned to understand and respond to local financial needs.”
The Advancing the Mentor Protégé Program for Small Financial Institutions Act was included in the bipartisan Housing for the 21st Century Act that aims to increase housing supply, prioritize affordability and advance housing equity. It now moves to the Senate for consideration, and has the support of numerous banking organizations.