Federal Deposit Insurance Corporation

Minority Depository Institutions: Structure, Performance, and Social Impact Federal Deposit Insurance Corporation

Publisher Marketing: In the fall of 2011, the Federal Deposit Insurance Corporation (FDIC) announced a Community Banking Initiative focused on understanding the evolution of U. S. community banks over the past 25 years and the challenges and opportunities faced by this segment of the banking industry. Under this initiative, the FDIC hosted roundtable discussions across the country; undertook a review of its examination, rulemaking, and guidance processes; developed a technical assistance video program for bank directors, officers, and employ-ees; and completed the FDIC Community Banking Study. In 2013, FDIC Chairman Martin Gruenberg announced that the FDIC would undertake a similar study of minority depository institutions (MDIs) and FDIC-insured community development financial institutions (CDFIs). Chairman Gruenberg described the important mission of MDIs and FDIC-insured CDFIs by noting, "Minority and CDFI banks play a vital role. Your mission is important. You provide responsible banking services to those who might not otherwise have access to a bank. And, you serve some of the most challenging markets in the country. One way we can contribute to your efforts is by conducting research specifically on MDI and CDFI institutions-to better understand the role they play in our financial system and in our communities." This study carries out this goal by building on analytical work discussed at the June 2013 Interagency MDI/CDFI Bank Conference, starting with a description of MDIs and FDIC-insured CDFIs and where these institutions are located. The remainder of the study is primarily focused on MDIs, for which the FDIC has historical data, exploring how this segment of the financial services industry has changed over time, how MDIs have performed financially, and the extent to which MDIs have achieved their mission in serving the needs of their community. It is important to note that when discussing CDFIs, the report focuses on the small share of CDFIs that are FDIC-insured, rather than all CDFIs.