Before attendees of the Freedman's Bank Forum in Washington, D.C., NCUA Chairman Rodney E. Hood provided welcoming remarks and moderated a panel discussion on the importance of minority depository institution preservation. Comptroller Joseph Otting; Assistant Secretary for Financial Institutions at the U.S. Department of the Treasury, Bimel Patel; Federal Deposit Insurance Corporation Chairman, Jelena McWilliams; and Federal Reserve Board Governor, Michelle Bowman are also pictured.
As Prepared for Delivery on March 3, 2020
Thank you. It’s a pleasure to be here today to mark the historic 155th anniversary of the Freedman’s Bank.
I’ve spent my career working in and around the financial industry, either in the private sector or in public service. Much of that time — stemming from my earlier work as a missionary in Africa — has been spent in the places where human compassion, community engagement and financial services intersect.
With that background, I’m drawn to the history of the Freedman’s Savings and Trust Company, because it illustrates the power of an idea to make a difference in people’s lives.
A notable detail in the bank’s history I find most compelling is the origin of the idea: the Freedman’s Bank was first conceived by John W. Alvord, a New York abolitionist and Congregationalist minister.
This was only two years after President Lincoln had issued the Emancipation Proclamation; the Civil War was still ongoing, though nearing the end. Yet Alvord was already looking ahead, envisioning what might be needed for African-American families to climb the ladder toward economic security. And he carried that idea for a new financial institution to a group of philanthropists and businessmen; they saw its merits, and worked to secure a charter from the federal government.
So the founding of the Freedman’s Bank was more than just a business opportunity. In its original conception, it was an act of humanitarian service to others, rooted in a sense of deep faith and generosity, for the benefit of people who had very little.
Today, we call it “financial inclusion.” But to the bank’s founders, this was greater than a policy goal: it was a moral and ethical imperative.
That is an extraordinarily powerful idea that John Alvord — again, I’ll emphasize, a clergyman, not a banker — translated into reality.
The Freedman’s Bank showed tremendous promise, growing rapidly and serving tens of thousands of depositors. During its time, it appeared to be a triumph of forward-thinking and innovation.
Today, we celebrate the Freedman’s Bank for a single reason: Because it was a powerful idea, rooted in faith and centered around community service.
The light of that idea continues to shine brightly today. I’ve certainly seen it myself, both in my private sector work, and in my current service as Chairman of the National Credit Union Administration, where the reigning value is “people helping people.” Much like the Freedman’s Bank, the NCUA was formed as a way to provide financial services to those with limited access. Today, our nearly 500 minority depository institutions still embody that principle of serving vulnerable and marginalized communities.
I see that principle reflected again and again in visiting credit unions around the country: financial capability programs, small business lending initiatives and sustainable homeownership activities. Many of my colleagues here who work with other areas of the financial industry can tell similar stories. But it all began with that powerful idea of service that led to the creation of the Freedman’s Bank.
That sense of service to the community may be the most important legacy of the Freedman’s Bank, and it’s a legacy we should all strive to carry forward. Thank you very much.