Our Commitment to the Triple-Bottom Line
Summer 2012 | CEO Letter by Kat Taylor
Dear Customers and Stakeholders of Beneficial State,
In this year of momentous developments, I write to report on the work of your bank. As part of our commitment to the triple bottom line -- securing measurable environmental and social justice benefits at the same time we remain financially sustainable -- we renew our efforts to be transparent. Here below please find some charts we hope will begin to illuminate the impact of our lending by LMI census tract and targeted transformative sectors. We can and will do much better to understand the real outcomes we are achieving. Please click on mission reporting to see our strategy for constant improvement. If you read no further, I hope you get a sense of how our lending to underserved markets and promising new practices might secure the future we all want to see.
Although it may seem the banking system has returned to the tactics that sent us tail spinning into recession and dismay five years ago, I note some positive trends for beneficial banking. The Global Alliance for Banking on Values released a study of that five-year period showing that the mission-motivated banks significantly outperformed the dominant banking sector.
Indeed, this past week Moody's downgraded the five biggest American banks citing poor prospects for growth or earnings. That is nothing to cheer about and we must concur that there are no easy wins in business, nonprofit work, or lending these days.
But if shrinking big bank prospects might also mean that there is more room for constructive lending activities that begin to shift society toward a resiliently prosperous future, then we are poised to grow. We are committed to investing our loan dollars into those activities that increase economic mobility for the most disadvantaged, shepherd natural resources for the long run, unleash the productivity and imagination of our fellow Americans, and improve wellness for all.
Although OPCB pursues its mission largely as a commercial lender, we recognize that we must protect the wealth that businesses and individuals thereby create from pernicious banking practices still in our midst. Payday lending might be the greatest scourge of all because it is rampant and enjoys powerful political support. The PAL loan under pilot at OPCB right now shows promise of being just the competitive alternative for those in need of emergency short-term credit. Offered through employers, it is a product that could scale while being financially feasible, that meets the FDIC's parameters for responsible small dollar lending, and that absolutely pulls the rug out from under convenient political arguments that the poor need payday loans because there is no other option.
In terms of our financial health, we just passed our first full OCC exam in good shape and are striving toward profitability in 2013 as forecasted. Profitability is coming a bit later than would be expected for a bank launched in 2007 but well within reason given the extraordinary context of our birth and the fact that we undertook a merger involving a workout portfolio in our de novo stage. We were honored to have the chance to merge with ShoreBank Pacific and those workouts are proceeding as planned and within the buffer of the discount we negotiated going into the deal. As mergers go, and they are all difficult, we feel the hard work has been more than offset by an excellent band of new colleagues and customers as well as an ideal geographic footprint for a resilient, bio-regional bank to serve. Onward!
Each month, we will try to spotlight a lending sector and another banking service Beneficial State is offering in an effort to build real wealth and well-being. We hope you will provide feedback about our strategies as well as your banking experience and needs. As our customers and stakeholders, you harbor treasured information about the way forward. Thank you for your business and partnership. We are only here to serve you, our employees, our communities, and the earth upon which we all depend.