Freedom National Bank

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Freedom National Bank was an African-American owned bank in Harlem (New York City) founded in 1964 and shut down in 1990. Freedom National served Harlem's Black community and was one of the largest Black owned banks in the U.S. [1] [2] Its main office was at 275 West 125th Street.

History

Freedom National Bank was founded in 1964 by investors including Jackie Robinson and Dunbar Simms McLaurin (1920–1973). [1] [3] The New York Times referred to it as "biracial" when it was founded in 1964. [4]

A 1966 Harvard Crimson article was critical of the bank. [5] Freedom National competed with another Black owned and focused bank, the older Carver Federal Savings and Loan Association (now Carver Bancorp).

Freedom National failed in 1990 during a recession [6] as it faced loan defaults and internal division. [7] [8] [9] When it was shut down, Freedom National had $101.9 million in assets, two branches in Brooklyn, 22,000 depositors, and 97 employees. [1] The bank had also struggled in the mid-1970s but was able to return to profitability.

In 1990, the Federal Deposit Insurance Corporation (FDIC) bailed out depositors up to the U.S. government's $100,000 guarantee for deposits. [1] [10] The decision was seen as a serious "blunder", in contrast to FDIC's treatment of the vast majority of "800 bank failures in the last four years". In those cases, FDIC did not just pay off insured accounts, but instead facilitated new owners to take over failed banks so that the customers received all their money back.

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References

  1. 1 2 3 4 Andrew L. Yarrow (1990-11-12). "Freedom Bank's Failure Hits Harlem Like a Death in the Family". The New York Times . Archived from the original on 2016-03-07. Retrieved 2018-01-13.
  2. ↑ "First Class Citizenship - The Civil Rights Letters of Jackie Robinson". Real Design Media. Retrieved January 13, 2018.
  3. ↑ "DUNBAR M'LAURIN, LAWYER, IS DEAD". The New York Times. July 11, 1973. Retrieved January 13, 2018.
  4. ↑ Cowan, Edward (December 19, 1964). "Freedom National Bank in Harlem Prepares to Open". The New York Times. Retrieved January 13, 2018.
  5. ↑ Snell, Suzanne M. "Harlem's Freedom National Bank--Exploiters or Soul Brothers?". The Harvard Crimson. Retrieved 13 January 2018.
  6. ↑ The Crisis. The Crisis Publishing Company, Inc. 2009. p.  40 . Retrieved January 13, 2018.
  7. ↑ Strom, Stephanie (December 3, 1990). "Failed Dreams - The Collapse of a Harlem Bank; Freedom Bank's Demise: A Trail Of Risky Loans and Fast Growth". The New York Times. Retrieved January 13, 2018.
  8. ↑ Yarrow, Andrew L. (November 12, 1990). "Freedom Bank's Failure Hits Harlem Like a Death in the Family". The New York Times. Retrieved January 13, 2018.
  9. ↑ Elstein, Aaron (March 22, 2015). "Saving Carver Federal, New York's last black bank". Crain's New York Business. Retrieved January 13, 2018.
  10. ↑ Knight, Jerry (January 13, 1991). "HARLEM BANK'S FAILURE SYMBOL OF FDIC INEQUITY". The Washington Post. Retrieved January 13, 2018.
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