♪♪ ♪♪ ♪♪ >> William Bynum, the CEO of Hope Enterprises, next on "The Chavis Chronicles."

>> Major funding for "The Chavis Chronicles" is provided by the following.

At Wells Fargo, diverse representation and perspectives, equity, and inclusion is critical to meeting the needs of our colleagues, customers, and communities.

We are focused on our commitment to diversity, equity, and inclusion, both inside our company and in the communities where we live and work.

Together, we want to make a tangible difference in people's lives and in our communities.

Wells Fargo -- the bank of doing.

American Petroleum Institute.

Through API's Energy Excellence Program, our members are committed to accelerating safety, environmental, and sustainability progress throughout the natural-gas and oil industry around the world.

Learn more at api.org/apienergyexcellence.

Reynolds American, dedicated to building a better tomorrow for our employees and communities.

Reynolds stands against racism and discrimination in all forms and is committed to building a more diverse and inclusive workplace.

At AARP, we are committed to ensuring your money, health, and happiness live as long as you do.

♪♪ ♪♪ >> We are most honored to have a very distinguished and experienced leader in the financial services community, William Bynum, the CEO of Hope Enterprises.

Man, you've been doing a lot of stuff throughout the South, but tell us where you were born.

I always like to deal with your upbringing.

>> Thank you for having me.

I was born in New York.

But I am a product of the reverse Great Migration.

My parents were from North Carolina, and my sisters and I were starting school.

They decided that they preferred to raise us in North Carolina.

>> Okay.

>> So I actually moved to Bynum, right outside of Chapel Hill, a little town that was named after the people who owned my folks.

>> I was getting ready to say, there was some big plantations named Bynum in North Carolina.

>> And that's where I lived and grew up in North Carolina.

And, so, I've been -- I've been in Mississippi for about 30 years.

But I got there after I attended college at University of North Carolina.

I think following your footsteps to a significant degree.

>> Thank you, yes.

>> We have a similar experience.

I was the chairman of the Black Student Movement.

>> Right, at UNC-Chapel Hill.

>> At UNC.

>> I was the chair of the Black Student Union at UNC-Charlotte.

>> And as you know, there weren't very many students who looked like you and me on those campuses.

There were a few more when I got there, thanks to some of the work that you and others had done.

But we were still a significant minority, and that's where I went to school.

We were able to actually have the first tenure decision ever in the history of University of North Carolina overturned.

Dr. Sonja Stone was denied tenure, and we -- my first day as chair of the Black Student Movement, we protested at a trustee meeting and we were successful in... >> Very successful.

>> ...getting that overturned.

Now, I did that and then was on my way.

I thought I was on my way to law school, and it's really exciting to be here in the Thurgood Marshall building because I wanted to be a Thurgood Marshall.

But I was wait-listed and ended up working at an organization that was trying to help employees that were losing their jobs in the mid-'80s because of plant closings, not because the businesses weren't viable, but because they were more profitable south of the border and elsewhere.

And, so, we decided to help those employees buy the companies, employee ownership.

And when we would go to banks to try to get financing, they weren't as interested in financing the businesses that were run by blue-collar folks, women, people of color.

And, so, we decided to start our own financial institution.

And that's how I diverted from law school.

>> All right.

Well, you know, I think you're being very modest.

I've read your bio.

You are the Thurgood Marshall of financial services in the South.

>> Well, very generous.

>> And I want to get into community development financial institutions, CDFIs.

Explain for our audience, what is a CDFI?

>> When Bill Clinton ran for president, one of his key platform items was to create a national network of 100 community development banks and 1,000 micro business loan organizations.

He had been exposed to Doctor Muhammad Yunus, the Nobel Prize winner who had created micro businesses, supported micro businesses in Bangladesh at the Grameen Bank.

And folks from Chicago who had created ShoreBank, which was one of the grandfather of community development financial institutions in this country, in Chicago, to help close gaps in the South Shore neighborhood, had started a spin-off, a replication in Little Rock.

And, so, President Clinton was familiar with that.

And, so, he knew what a difference it made in lives in Arkansas.

And, so, he wanted to bring that nationwide when he became president.

And, so, he was successful in creating the CDFI, Community Development Financial Institutions Fund, in Treasury.

And since then, it has driven billions of dollars into -- >> So, prior to President Clinton, there was no CDFI?

>> Well, ShoreBank was one, Self-Help, the organization that I was a part of in North Carolina, was one.

There had been loan funds across the country that had targeted, opportunity gaps, banking deserts, and where traditional banks don't go.

And, so, whether it's credit unions, loan funds, banks, people have done this work for a long time.

In North Carolina, there were dozens of minority credit unions that were created in the '50s and '60s.

They were never adequately capitalized, but those were the precursor to what we call CDFIs today.

>> You know, my antenna went up when you said banking deserts.

>> Yes.

>> I know there are food deserts and housing deserts, but this the first time I've heard of banking deserts.

So are you saying that there are places where people have a challenge to even get basic banking?

>> Unfortunately, it's way too common.

If you look across the country, you know, there are so many communities where there is not a bank.

And often where there is a bank, the bank will only offer basic services.

They'll cash a check and take your deposit, but you can't apply for a mortgage loan.

You can't apply for a small business loan.

You have to travel miles away.

And, so, you really don't have access to one of the most fundamental tools that someone needs to climb the economic ladder.

And, so, when you have a banking desert, that creates all kinds of opportunity deserts, because I think, if one is honest, whether it's education, housing, you know, grocery store, health care, at some point you need capital to fuel those basic tools that one needs to achieve prosperity for a community and an economy to be successful.

But when you don't have a bank, then it has tremendous and devastating ripple effects.

>> Hope Credit Union.

Hope Development Enterprises.

Why did you decide to give this such a hopeful name?

>> It's interesting.

My day job was a loan fund.

Actually, the credit union started in a church in Jackson, Mississippi, Anderson United Methodist Church.

And when, you know, I went to Mississippi, that's where I joined.

And I was talking to Pastor Stallworth about my background, and I mentioned credit unions.

He said that he'd been trying to start a credit union at that church for -- because there were payday lenders and check cashers in the neighborhood, but no bank.

And, so, next thing I know, that's my ministry at the church.

We decided to come up with trying to come up with a name.

I thought Mustard Seed would be a good name.

There was already a Mustard Seed in Jackson, and my wife's name was Hope.

I thought it was a good name, but I wasn't as presumptuous to suggest that.

But the pastor said, "I think it should be named Hope."

And, so, it means a lot, both in terms of what we want to make -- inject into the community and to families, but it also has a special meaning to me.

>> Now, today, how many states are you operative in?

>> We expanded from the Delta in 2002, 2003, both in terms of programs -- We were just focused on business development initially.

We are now in five states.

We're in Alabama, Arkansas, Louisiana, and Tennessee.

If you look at that region, it's interesting.

We're talking about deserts.

If you overlay a map of that part of the country where slaveholding was concentrated prior to the Civil War, and today, where you have the lowest education outcomes, lowest access to healthy food, worst health care conditions, you can go on and on.

They're very, very similar places.

One-third of all the places in the United States where poverty has been over 20%, not for 30 years, which is a federal definition of persistent poverty, but for half a century, are in Alabama, Louisiana, and Mississippi.

>> Consistent poverty?

>> Deep-rooted entrenched poverty.

>> How can we overcome what you've described as institutionalized poverty?

>> When you look back at that region, as I said, it goes back centuries.

And when you have the extraction of wealth, when you have the inability to build wealth, that compounds just like interest compounds.

The deficits compound over the years.

And you have what we all know today is a wide wealth gap between Black and White households.

Roughly 10 to 1 is what typically is assumed.

>> It's that big?

>> It's 10 to 1.

It's 100 to 1 when you look at Black families with children compared to White families with children.

And, so, that puts you at a significant disadvantage when you think about what it takes to achieve stability and health and to put your children on the right trajectory.

And, so, we focus on ownership, whether it's account ownership.

One-third of our members didn't have a bank account before they joined Hope.

Almost 50% either didn't have an account or were relying on payday lenders and check cashing.

So ownership, just owning an account, is an important first step to accessing the economic system.

Home ownership.

Still the primary asset on one's balance sheet is a home.

Most Americans, that's their primary source of wealth.

And then, business ownership, the gap closes to 3 to 1.

It's not even what it should be, but business owners, Black compared to White, the gap is 3 to 1.

And, so, in making resources available to them so that they can own is critically important.

And that's our primary tool for achieving Hope's mission.

And we talk about Hope as a financial institution, as community development financial institution, but we really exist to improve the financial health and wealth of people in the Deep South.

Finances is a tool.

It's necessary, but the end goal is helping people get in a position where they can support their families and contribute to their economy.

>> And based on this work that you've already accomplished and that you're doing today, what is the trend?

Is the pendulum swinging in the right direction?

Are we making progress on home ownership, on business ownership?

The things that you've outlined that can help close the wealth gap.

>> You know, we're excited.

We are one of, if not the largest, Black- and woman- owned financial institution in the country.

We see periods where we make significant progress, but we're small compared to the financial system.

And, so, in addition to our financial tools, we have a policy arm, Hope Policy Institute, that takes data from the experiences of the families that we serve and bring it to Washington, to policymakers, to statehouses in our region, to businesses to encourage them to recognize that it's in our collective interest, as we become -- people of color become an emerging majority in this country.

We're shooting ourselves in the foot if we don't equip people to contribute to that economy, regardless of which side of the aisle you're on.

And, so, we -- While every family that we serve is important, we think our impact is exponentially greater when we are able to move systems and policy and get banks to do better, when we get private companies to recognize the importance of diversity and inclusion.

>> When you bring the data that you've gotten out of your own lived experiences, do public policy makers, do they pay attention to the data that you bring, first at the state level, but also at the federal level?

>> It depends.

I think that's why we were created to be an independent, private, nonprofit organization.

You know, when you have policymakers that are supportive of investing in all communities, then we make progress, but that's not always the case.

Mississippi is not Massachusetts at the statehouse and in the legislature.

And, so, you often have policies that are adversarial to the communities that we serve.

You know, in Mississippi, a Black household that has income of $150,000 is less likely to get approved for a mortgage than a White household that has $35,000 in household income.

>> Today?

>> Today, that's data from the Mississippi Housing Agency.

Those are systemic, deep-rooted, discriminatory structures that limit people's opportunity to gain one of the most valuable assets that a family can hold.

>> Wow.

150,000 versus 35,000?

>> That's right.

And you can see similar data when you look at small business.

In Arkansas, whereas 9% of all businesses are Black-owned, only 1% of Small Business Administration loans go to Black businesses.

It's in a state where roughly 12%, 13% of the population is Black, 9% of all businesses, but 1% from the program that is specifically designed to help businesses that are fledgling, that have collateral shortfalls.

You know, that is not coincidental that that program goes through traditional banks.

And, so, that's why CDFIs are so important, particularly CDFIs that are mission driven.

Another data point -- in Mississippi, we did an analysis that showed who gets mortgages.

And all banks in Mississippi, their average, their lending to Black homeowners is around 17%.

Among CDFIs in Mississippi is 13%.

So you're getting federal money, but you're actually widening the gap because there's not enough accountability injected into the program to make sure that the dollars go where they go.

You can become a CDFI if you're in a low-income area.

Well, if you're in a low-income area and you're not lending to low-income people or people of color, then you're not fulfilling the mission of a CDFI.

>> A lot of corporations, a lot of businesses are backing off of DEI, diversity, equity, and inclusion.

In fact, there's a debate about whether or not DEI contributes to profitability.

>> That's right.

>> What would you say to policymakers or to business executives, more importantly, who are contemplating ending their diversity, equity, and inclusion programs?

>> I say they're very shortsighted.

Again, as I mentioned, this country is increasingly diverse.

The emerging majority of Americans are people of color, but disproportionately, they don't have the tools.

They're not -- They're not afforded the opportunities to climb the education ladder, to build assets.

And that ultimately is detrimental to your business interests.

We were started, one of our founding board members was the chairman of Walmart and the chairman of the largest electric utility in the region.

They recognized that there is a self -- there's a mutual interest.

You can't sell things that people can't buy, if people don't have income, if you're in Walmart.

You sell more kilowatts if you have businesses, more rooftops, more homes.

And, so, there's a mutual interest, and so I think that, if people step back and follow the lead of -- I saw you had Robert Smith on.

And we worked with Robert, talked to the Business Chamber of Commerce.

And we were able to get them to commit, and they made a commitment that the purpose of a company is an economy that works for everyone.

After the George Floyd murder, Netflix made a deposit in Hope, $10 million -- it's well above the $250,000 federal insurance limit -- because they knew that their interests were served by a productive, diverse economy.

It was followed by similar deposits by Nike, by PayPal.

And we've worked with the Vice-President, the Biden-Harris Administration to broaden the number of companies that recognize the importance of investing in diversity and inclusion and CDFIs like Hope, the ones that are really mission driven.

And, so, I think we're seeing progress.

Unfortunately, as you said, there is pushback.

There are lawsuits against CDFIs that, because we -- >> Really?

>> Yes, there's -- >> But why would somebody file a lawsuit against a community development financial institution since that would help the overall economy of these communities?

>> I think it's shortsighted.

I think it's politically motivated.

And we have data that shows that it is good for the economy when everyone can participate.

And, so, I -- I don't know what exactly is driving these decisions.

I have to admit, I have to assume that it's, again, politically motivated.

But we're going to push back.

We open our books.

We show that we don't discriminate against anyone.

Anyone can access our services, but we prioritize those people and communities that need it most, and disproportionately, those are people of color.

>> The Biden-Harris Administration, you mentioned, have they been supportive of this effort to increase pathways to wealth building in the communities?

>> Congress, after the -- on the heels of the pandemic, directed $9 billion into organizations like Hope.

>> 9 billion?

>> 9 billion to help us to build our balance sheets and import capital into capital-starved communities.

The Greenhouse Gas Reduction Fund.

I know you have a strong history in climate and on climate issues.

There are billions and billions of dollars that are available to help improve energy conditions, environmental conditions in the country.

And they are using working with CDFIs to help make sure that the benefits go to those communities that are most climate vulnerable.

And, so, I think there's positive movement.

There's still much, much more work to do.

But I'm encouraged by what I'm seeing.

>> What would you say would be the number one driver of future progress to make sure that each generation does better than the prior generation?

>> Making the case that investing in communities, like those in the Black Belt, like those in the Delta, like any inner city across the country that is disproportionately under-resourced, makes economic sense.

I think relationships only work when everyone gets something out of it.

And certainly it's clear that the residents in these communities need the same tools that other communities have to climb the economic ladder.

But it's not just the right -- a good thing to do.

It's the smart thing to do for businesses, for the nation's economy.

And I think there are data that support that.

So I would really encourage us to both emphasize the moral case for investing in these communities, but the business and economic case, and I think -- >> So there's an ROI, there's a return on the investment.

>> Absolutely, absolutely.

I think any any business that steps back and takes the long view knows that there are future markets, their customer base, the economy is going to be dependent on a more prosperous, diverse population.

>> So William Bynum, the CEO of Hope Enterprises, Hope Credit Union, what gives you your greatest hope today?

>> When I go into Birmingham, we just merged with a credit union that was started in 1963, when Black folks could not go to a bank to make sure that people had access to basic tools.

And that credit union this year merged into Hope Credit Union.

So we are carrying the legacy of that credit union.

We're carrying the legacy of credit unions in East Mississippi that were started by woodcutters who had to start their own credit union because the timber mills were charging them predatory rates for their equipment and inventory.

There's so many shoulders that we stand on, and I know that the hill was so much deeper for them.

We are a $1 billion financial institution.

It's tiny in the scheme of the large financial institutions, but we have come a long way standing on the shoulders of those leaders, those freedom fighters who gave their all.

And, so, I believe that we have their lessons to build on.

We have lessons from you to build on, and I see that there are people who do amazing things when they just have the chance.

So I have no doubt we'll be successful and have no doubt that there's going to be barriers in the way.

But I've seen those barriers knocked down, and we'll continue to do so.

>> Well, we wish you all the best, and I hope the rest of the nation can learn from your success... >> Thank you.

>> ...in Mississippi and throughout the South.

>> Thank you.

I really appreciate spending time with you.

>> Thank you.

>> For more information about "The Chavis Chronicles" and our guests, please visit our web site at TheChavisChronicles.com.

Also follow us on Facebook, X -- formerly known as Twitter -- LinkedIn, YouTube, Instagram, and TikTok.

Major funding for "The Chavis Chronicles" is provided by the following.

At Wells Fargo, diverse representation and perspectives, equity, and inclusion is critical to meeting the needs of our colleagues, customers, and communities.

We are focused on our commitment to diversity, equity, and inclusion, both inside our company and in the communities where we live and work.

Together, we want to make a tangible difference in people's lives and in our communities.

Wells Fargo -- the bank of doing.

American Petroleum Institute.

Through API's Energy Excellence Program, our members are committed to accelerating safety, environmental, and sustainability progress throughout the natural-gas and oil industry around the world.

Learn more at api.org/apienergyexcellence.

Reynolds American, dedicated to building a better tomorrow for our employees and communities.

Reynolds stands against racism and discrimination in all forms and is committed to building a more diverse and inclusive workplace.

At AARP, we are committed to ensuring your money, health, and happiness live as long as you do.

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