In 2023, a group of Black investors based in Atlanta agreed to buy a white-owned bank, Holladay Bank & Trust, and convert it into a Black-owned one. The investors included Dr. Bernice A. King, a daughter of civil rights icon Dr. Martin Luther King Jr; Ashley D. Bell, a former White House policy adviser, and former NFL player Dhani Jones.
They planned to rename the Utah-based institution Redemption Bank and said they wanted to provide financial services to Black communities historically underserved by financial institutions while offering online banking services and small business loans.
The deal, which was awaiting regulatory approval, would mark the first time Black investors purchased a non-Black bank, a statement by Redemption Holding Company said at the time. It would also be the first time in American history that an existing commercial bank would become a Black-owned Minority Depository Institution (“MDI”) through acquisition, the statement added.
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After two years, Redemption has finally completed its acquisition of Holladay Bank & Trust. It makes it the first time a bank has been owned by a Black-led investment group in the Western U.S., the AP reported this month.
The acquisition got delayed due to the collapse of Silicon Valley Bank in 2023, Bell, CEO and chairman of Redemption Holding, told the AP.
“This process has undoubtedly taken longer than any of us anticipated,” Bell said. “However, we are grateful for the diligence of the staff at the FDIC, the leadership of the (American Bankers Association), and the renewed sense of urgency from the new administration this year, all of which helped bring everything together.”
READ ALSO: MLK’s daughter Bernice King, other Black investors make history buying white-owned bank
While Bell is the CEO, King is expected to be Redemption Bank’s senior vice president for corporate strategy and serve on the company’s advisory board.
With about $65 million in assets, Redemption Bank will be the first Black-owned bank not physically located within an economically vulnerable community and the first in the Rockies, according to the AP.
It will also be the only one located in the Black-banking desert that stretches from Houston to Los Angeles, the AP added.
The company will further become the 24th Black-owned bank in the nation, termed as Minority Depository Institutions (MDI). MDI is a federal designation for banks and unions that are owned or controlled by minority groups. The most recent MDI was Adelphi Bank, launched in January 2023.
Bell earlier told AJC that more Black banks are critical for financial inclusion and wealth generation. He explained that the U.S. system has historically denied Blacks the opportunity to build wealth.
“This system has offered no grace and no mercy for Black people in our country,” Bell said. “We think that having a bank called Redemption, where grace and mercy will be bountiful for people who need it, is important.”
Redemption bank, which will still be headquartered in Salt Lake City, hopes to launch a fully digital platform at the end of summer to enable it to fully serve small businesses across the country.
“We found an exceptional business environment in Utah, specifically in Holladay, along with a bank that has a clean balance sheet and a state with the highest average return on assets for banks in the country. We are committed to competing in Utah to earn the business of customers from all backgrounds,” Bell said.
