National Bankers Association Statement on Silicon Valley Bank and Signature Bank

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Earlier this week, National Bankers Association President and Chief Executive Officer Nicole Elam Esq. and President Robert James II released the following statement regarding Silicon Valley Bank and Signature Bank.

“In light of recent industry events, the National Bankers Association wants to assure consumers that your money is safe with minority banks. The minority depository institutions are very different from both SVB and Signature Bank, which had a high concentration of cryptocurrency deposits and volatile equity capital. Minority banks are not exposed to riskier asset classes and have the capital and strong liquidity to best serve consumers and small businesses. If you’re looking for a place to take your deposits and make a bigger impact, take your deposits to minority banks,” Elam said.

“The Biden-Harris administration, the FDIC and the Federal Reserve worked hard this weekend to make sure these bank failures are the exception, not the rule, and that all Americans can continue to have faith in our banking system. I also applaud bipartisan leaders in Congress for keeping interested parties informed about how hard-earned deposits are kept safe. said James.

The National Bankers Association is the nation’s primary trade association for the country’s minority depository institutions. MDIs have always focused on security and robustness as part of our conservative, relationship-based business model. We continue to monitor the impact of SVB on large concentrations of corporate deposits, fintechs, technology companies and larger financial institutions that have partnerships with MDI or have made investments in MDI.

MDIs are in the strongest position ever to support their customers and here’s why:

  • Traditional banking model with diverse and safe assets: MDIs are diversified in terms of assets, predominantly focused on well-secured loans, and are not exposed to riskier asset classes. Unlike SVB and Signature Bank, MDIs have very limited exposure to the venture capital and cryptocurrency industry.
  • Well Capitalized and Strong Cash: MDIs are in the strongest position ever. The sector is exceptionally well capitalised, enjoys substantial overall liquidity and has grown by 33% in the last three years in total assets. Nearly $4 billion of new permanent capital has flowed into MDIs and currently MDI’s average common stock ratio is 16.4% versus 14.8% for non-MDI MDIs.
  • Positioned for Impact: 77% of MDI branches are located in areas with a higher average share of minorities compared to 31% for all FDIC-insured depository institutions. According to a 2022 Dallas Fed study, MDIs originate nearly 40% of their mortgages to minority borrowers, versus only 10% from other banks. Additionally, MDIs originate 30% of small business loans to lower- and middle-income communities compared to 20% for community banks and 24% for large banks. Not only are customer deposits extremely safe in an MDI, they are much more likely to have a positive impact on the community.


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