The Mission Driven Bank Fund has announced a significant investment in FNBC Bancorp, Inc., a community development financial institution (CDFI) bank, as part of its ongoing efforts to close the racial wealth gap and expand financial services in underserved communities. This investment, revealed on December 10, 2024, marks the seventh deployment by the Fund in 2024 and underscores its commitment to fostering a more inclusive banking system.
FNBC Bancorp, Inc., which operates in Arkansas and Missouri, plans to utilize the new capital to broaden its geographic footprint and enhance its service offerings in North-Central Arkansas and Southern Missouri. The bank’s leadership has expressed intentions to grow existing products, with a particular focus on increasing credit access for underserved populations through their First Chance Mortgage Program and Small Dollar Loan Program.
Marty Sellars, CEO and Director of FNBC Bancorp, Inc., highlighted the bank’s efficient use of funding, stating, ‘Since 2016, for every dollar the bank has received in grant funding, we have reinvested $12 in loans across our footprint, a 12:1 loan to fund ratio. We hope to do the same with this new capital and technical services support from MDBF.’
The investment in FNBC Bancorp aligns with the Mission Driven Bank Fund’s strategy of supporting mission-aligned banks with tailored investment instruments and subsidized technical services. This approach aims to empower these institutions to better serve communities that have historically faced barriers to accessing financial services.
The Mission Driven Bank Fund’s focus on CDFIs and Minority Depository Institutions (MDIs) that target African American, Native American, Asian, Hispanic, and Pacific Islander communities is a critical step towards addressing systemic inequalities in the banking sector. By providing capital and technical assistance, the Fund aims to drive significant growth and financial resiliency in the mission-driven bank sector, ultimately contributing to progress in closing the racial wealth gap.
As the Fund continues to engage with and invest in mission-aligned banks, it anticipates raising additional capital through May 2025. This ongoing commitment suggests a long-term strategy to transform the banking landscape and create more opportunities for underserved communities to access financial services and build wealth.
The involvement of Elizabeth Park Capital Management, a specialist firm investing in U.S. banks, and Calvert Impact, a leading impact investing firm, as members of the Fund’s general partner, brings expertise and credibility to the initiative. Additionally, the participation of Strategic Value Bank Partners as a subadvisor and Performance Trust as a capital advisor and structuring agent further strengthens the Fund’s capacity to make impactful investments.
This investment in FNBC Bancorp represents a significant step towards creating a more equitable financial system. By supporting CDFIs like FNBC, the Mission Driven Bank Fund is not only injecting capital into underserved areas but also fostering economic development and financial inclusion. The potential impact of this investment extends beyond immediate financial services, potentially catalyzing long-term economic growth and stability in communities that have historically been marginalized by traditional banking institutions.
As the banking industry continues to evolve, initiatives like the Mission Driven Bank Fund play a crucial role in ensuring that progress includes all segments of society. The success of this investment and similar future endeavors could serve as a model for addressing financial inequities and promoting inclusive economic growth across the United States.
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