Study Finds Banks Less Available to Working Class, Minority Communities

A new report by the National Community Reinvestment Coalition finds that most of the largest metropolitan areas of the United States have markedly lower numbers of bank branches in working class and minority communities than in the upper class and white neighborhoods.

Are Banks on the Map? An Analysis of Bank Branch Location in Working Class Neighborhoods draws the clear connection that without access to basic banking services, modest income families spend more of their limited resources for simple financial transactions.

"Despite the purchasing power that is clearly available in urban areas, these emerging markets have been left out of the mainstream bank ing industry," says John Taylor, NCRC president and CEO. "Without banks in the neighborhood, un-banked families are paying exorbitant fees for services that are practically free for the rest of us. How can anyone climb out of poverty if they have to pay $35 to a check casher on a $585 payroll check?"

In Are Banks on the Map? NCRC surveys 25 of the largest metropolitan municipalities, including their surrounding areas (MSAs), and maps out the number of bank branches located in communities based on income-level and minority population. This report shows in 24 out of 25 MSAs, urban areas that have dense populations have fewer bank branches -- therefore fewer mainstream banking opportunities -- than the less populated suburbs. Without the ability to build relationships with the regulated banking community, working class and minority neighborhoods are more likely to use"fringe" services, such as payday lenders and pawnshops, for small loans. They are also more likely to have their home loans originated with mortgage brokers and subprime lenders, which often led to foreclosures and unmanageable monthly payments.

"There are an estimated 14 million US households that do not have regular access to bank services," says Taylor. "If banks develop and expandtheir products needed by these communities, they would be helping themselves and the people they're chartered to assist."

At the top of the list with favorable bank branch/customer ratio, San Francisco, Miami, and Boston had higher than average number of branches in minority neighborhoods, whereas Houston, New York, Los Angeles and Chicago had relatively fewer in these communities.

Based on the findings in this report, NCRC calls for more attention tobe directed to the regulated and unregulated financial services available in these communities and for the strengthening of the Service Test of the Community Reinvestment Act (CRA). CRA requires banks to meet the needs ofthe communities in which they are located. By enhancing the Service Test, the public will be able to adequately measure the number of branches in various communities to evaluate whether banks are providing the quality and quantity need in those areas.

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By This Anniversary Year, U.S. Becomes Much More Accepting of Interracial Marriage

This year marks the 40th anniversary of Loving v. Virginia, the Supreme Court case that declared states could not prohibit interracial marriage. A measure of how far U.S. attitudes have come is that when U.S. Sen. Barack Obama's interracial parents married in 1960, their marriage would have been illegal -- and he would have been considered illegitimate -- in half of all the states in America.

Prior to 1970, the overwhelming majority of all couples were same-race married couples. Couples who lived together outside of marriage, whether heterosexual or same-sex, were practically invisible. Inter-racial marriages were extremely rare. In fact, until 1967, many states in the US had laws against interracial marriage. In Virginia, for example, all nonwhite groups, including blacks, native Americans, and Asians, were prohibited from marrying whites. Even in states that never had laws against racial intermarriage, such as Illinois and New York, racial intermarriage was rare before the end of the 1960s.

Since 1970 there has been a steady increase in all types of nontraditional romantic unions. The number of same-sex couples livingtogether openly has climbed significantly, while the number of heterosexual unmarried cohabiting couples has soared, from 3.1 million in 1990 to 4.6million in 2000 to 5.2 million in 2005.

State laws prohibiting interracial marriages were finally struck down in the Supreme Court's Loving decision. Yet such marriages continued to be very uncommon well into the 1970s. In 1970, less than 2% ofmarried couples in the US were interracial. By 2005, the number of such marriages had risen almost fourfold, with interracial couples representing 7.5 percent of all married couples. Although this percentage may seem small, it is a dramatic increase over several decades, and many signs pointto it accelerating in the future, says Michael Rosenfeld of Stanford University.

Some of the rise in racial intermarriage since 1970 is due to immigration, which has increased the racial diversity of the US since 1965. Hispanics and Asians are the predominant groups among the new immigrants, and because neither Asians nor Hispanics are residentially segregated tothe extent that blacks in the US historically have been, Asians and Hispanics have substantial opportunity to socialize with members of other racial groups, says Rosenfeld, of Stanford's sociology department.

The increased numbers of these immigrants have contributed to the rise in intermarriage between Hispanics and non-Hispanic whites, and the rise in intermarriage between Asians and whites, Rosenfeld says.

The rise in black-white marriages cannot be due to immigration. One cause is improvement in race relations. Despite enduring prejudices, the post-Civil Rights era has led to more socialization between blacks and whites, and to more intermarriage. Polls show that the percentage of Americans who want interracial marriage to be illegal has declined precipitously since the early 1970s, and thereis much higher acceptance of inter-racial unions than at any time in the past 200 years.

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