Reverend Preaches To The Banks

He waited patiently until the end of the morning session to speak. But when his turn came, he dropped a bombshell on the audience that had people buzzing as they went to lunch.
Reverend Dennis Dillon, president and CEO of the New York Christian Times brought down the house on Friday as he painted a grisly picture of miserable lending practices taking place in New Yorks African-American communities during a panel discussion presented by the Business Enterprise Network at York College.
Clive Williams Communications, Inc. presented the forum as an educational tool and networking session for entrepreneurs looking to gain a foothold in starting up their own businesses.
What they got was a lesson in the difficulties that lie ahead.
"The key to economic empowerment is to gain capital," Dillon said. "We did a study of banking patterns in the African-American community. Were struggling with the lending practices."
Dillon found that disturbing banking patterns exist in the African-American community where outsiders frequently open up storefronts with the help of loans. Statistics from a 2002 study provided by the Department of Commerce point to a culture of racism inside some of the largest financial institutions in the world.
"Its unfortunate that the black community is treated so horribly by the mainstream banking system," said Dillon. "These numbers are alarming and they are public knowledge."
Some of the largest banks in New York top the list of lenders avoiding African-American businesses. Citibank, which has over $740 billion in assets, exhausted only .5 of its total Small Business Administration (SBA) money on black-owned businesses. Fleet Bank spent less than $3 million or 2% of its SBA lending. HSBC Bank, one of the seven largest banks in the world, contributed just 3%. Washington Mutual failed to lend a single dollar, although in fairness to Washington Mutual, only 9% of its money deposits are black-owned, compared to Citibank and HSBC, which have higher membership rates.
"Fleet admitted that the numbers are correct," Dillon said. "Luckily there are other banks that have shown a significant level of interest to the black community."
Community Capital and Chase Bank both granted 20% of their SBA to African-American businesses, while Banco Popular contributed 10%.
But as the numbers indicate, on the whole, African-American entrepreneurs are not receiving the grants required to open up businesses.
"When you see people setting up businesses in our area, its because they have access to capital," he said. "While theyre doing that, were struggling with our own measly dollars."
The African-American population constitutes the largest consumer base in the city, spending 41 cents to every dollar, said Dillon. No wonder, he explained, businesses like K-Mart and Right Aid have flourished after moving into the African-American community where they found residents eager to buy their products.
"That shows the potency of the black community," he said.
But he pointed to the "mom and pop mentality" as a reason why black-owned businesses are not sprouting up to match consumer demand.
"We have to grow beyond that syndrome," he said. "Mom and dad have a little business that they work at. Their kids see them struggling and sweating all day and when the kids grow up they go to work for someone else. We need to create businesses that succeed. We need to access capital."
Clive Williams would like to have monthly meetings at York College. The school is the perfect setting, he said, to teach students how to start up their own businesses.
"I found that nobody was identifying the small, grass-roots businessman with a special emphasis on minorities," Williams said. "I hope this session can galvanize people to spread the gospel on how they can develop their own businesses. We need to have more meetings like these."