Editorial: Big banks commit to local communities
This holiday season, bankers are showing a more philanthropic streak.
Shortly after Thanksgiving, Rabobank announced an investment of $1 million into a small-business loan fund run by the Economic Development Collaborative of Ventura County.
Just before Christmas, Union Bank unveiled a multimillion-dollar investment that allowed the Channel Islands YMCA to acquire former Santa Barbara Bank & Trust offices and return the nonprofit’s regional headquarters to downtown Santa Barbara.
The Channel Islands group oversees seven YMCA operations from Camarillo to Lompoc. Its newly refurbished headquarters on the corner of Carrillo and Anacapa streets also includes some 4,000 square feet of commercial space that will be subleased to service the interest on its new below-market-rate mortgage.
These community-minded moves by Rabobank and Union, which earned top positions in the region largely through acquisitions, in part follow a trend established by Montecito Bank & Trust owner Mike Towbes 11 years ago.
Each year the privately-held bank provides $1 million in grants at a pre-Thanksgiving luncheon, with more than 100 community organizations benefiting, and Towbes has challenged other financial institutions to increase their investment in local communities.
The renewed emphasis on philanthropy demonstrates how far the banking community has come from the dark days of the financial crisis. The traditional year-end donations announced by a number of institutions including Wells Fargo, JPMorgan Chase, Bank of America/Merrill Lynch and others reflect a return to more normal economic times.
Also in action is a recognition that the nonprofit sector has a bigger role to play in communities, especially at a time when federal, state and local programs are being cut back.
And finally, there is a recognition by large global banks that local involvement matters. Traditional banking is rooted on Main Street, State Street or Higuera Street, not on Wall Street. Perhaps the best way to demonstrate that is by putting dollars to work to strengthen local institutions.