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Brian Argrett, President and CEO of City First Bank, joins Yahoo Finance’s Kristin Myers to discuss Broadway Financial Corporation and CFBanc Corporation combination to create the largest black-led minority depository institution in America.
KRISTIN MYERS: Recently, there was a merger among the Black banks. Broadway Financial and CF Bank-- that's City First Bank-- combined to create the largest Black bank in the United States with a combined asset total of over $1 billion. So we're joined now by Brian Argrett, president and CEO of City First Bank. Brian will also be the CEO of the new combined institution.
So Brian, $1 billion in combined assets, that's huge, particularly among the Black banks. I want to know how much this is going to help serve-- better serve, rather, under-served and under-banked communities, which are typically minority communities in the United States?
BRIAN ARGRETT: Well, Kristin, first of all, thank you, pleasure to be on the show. We believe it's going to help communities of color and low and moderate-income communities significantly. What we're doing, it's a merger of equals where we're bringing together two community development financial institutions that are well positioned, healthy. And we're bringing them together to really double down on our-- on just the question you asked, our ability to increase the flow of critical capital in capital gaps that exist initially in Washington DC area, where City First Bank is located, in Los Angeles, California, where Broadway is located, and then ultimately, beyond that.
KRISTIN MYERS: All right, so I want to know if you can tell us a little bit about your expansion plans, if there's going to be a lot more banks of this combined institution that we are going to be seeing, particularly in those minority communities?
BRIAN ARGRETT: Well, I think you've seen consolidation in banking more generally over the last years, certainly in the community banking space, certainly also in the larger banking space. So I think there's some degree of additional consolidation that may happen. For our part, this was a transaction that we looked at and started putting together more than a year ago, pre-pandemic, really thinking about, what could we do strategically to really increase the flow of capital to affordable housing, to small business, and of course, in support of non-profits. And so that strategic-- those strategic rationales made perfect sense then. Once we hit the pandemic, of course, this became even more important in our service.
KRISTIN MYERS: I'm wondering if in this moment that we've been seeing lately of social reckoning if you've seen an increased interest in banking Black-- that was a hashtag that I had seen circulating on social media-- if you're seeing more and more customers walking through your doors that are saying, you know what? I want to put my money-- instead of at Chase or, you know, Citibank, I want to put it inside of a Black-led bank.
BRIAN ARGRETT: Yes, absolutely. I think the combination of the pandemic, the economic conditions that we're currently under, and then most importantly, the social unrest, the awakening, and the recognition around how economic justice is also a component part of that has really led to interest in, how do I support, how do I invest alongside, how do I multiply the impact of dollars in the Black community and communities of color and more generally, and low and moderate-income communities? So yes, we are definitely seeing increased interest.
KRISTIN MYERS: So to that point, I'm wondering if you can comment a little bit about really the importance of this merger and just the importance of a movement like that, of banking Black-- banking Black, excuse me-- when you have-- just this quick stat, right? So you guys now have $1 billion or over $1 billion in combined assets. But just in contrast, JP Morgan, for example, has nearly $3 trillion. I mean, how is a bank like yours, how are Black banks supposed to compete, or do they even need to?
BRIAN ARGRETT: Well, we occupy a really important and unique space. And as you were alluding to earlier, that's even more important now than it ever has been. So part of the importance of Black banks, of community development financial institutions and the like is that they're rooted in the community with an explicit purpose of trying to close those capital access gaps. While other banks may have that interest tangentially for time to time, depending on the economic conditions, depending on the business strategy, they may not be there. And what's really important is that sustained, long-term effort of investing in your community.
As you know, community development and economic development doesn't happen overnight. It really requires attention. It requires discipline in how you execute on it, and it requires capital. And so yes, while the combined institution will be-- will have substantially more, it's still not going to be enough. And so we'll continue to try and grow the platform, hope that others do the same so that we can really address the systemic issue.