Two of the Largest Black Banks in the U.S. Receive $7.5 Million Investment from HubSpot

Two Black banks—M&F Bank and The Harbor Bank of Maryland—will get a combined $7.5 million investment from HubSpot.

Describing itself as a customer relationship management (CRM) platform for scaling companies, HubSpot reports the investment is the remaining amount of its $20 million social impact investing commitment backing Minority Depository Institutions (MDIs). The firm says the investment continues its pledge to Black communities to help stop systemic racism through introspection, investment, inclusion, and impact.

The investment will help support M&F Bank and The Harbor Bank of Maryland through the J.P. Morgan Asset Management’s Empower share class. A new institutional money market share class created in February 2021 for exclusive distribution by minority and diverse-led financial institutions.

With the share class, J.P. Morgan takes on the administrative and back-office work while training and mentoring the MDIs throughout the process. HubSpot explained that the MDIs gain a revenue share for most of the management fees charged on these accounts. That allows MDIs to gain a new recurring income stream without any of the regulatory challenges that come with taking large deposits directly into their bank, so they can better serve their communities.

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SOURCE: Black Enterprise, Jeffrey McKinney