2021 CSBS Community Bank Case Study Competition Journal

2021 COMMUNITY BANK CASE STUDY COMPETITION

because she could not afford the loan given her financial situation and credit score. Rather than letting Ms. Jackson leave empty handed, the personnel at SBB began working with her to improve her financial situation. Through one-on-one financial education and counseling, a Matched Savings Account (IDA), and free tax preparation through the Volunteer Income Tax Assistance (VITA) program, SBB helped Ms. Jackson improve her finances enough to afford a $23,000 home loan from the bank. The IDA or Individual Development Account used was a type of saving account designed to help income eligible individuals (those having an adjusted gross household income equal to or less than 200 percent of the federal poverty line) build assets, learn financial skills, which results in empowering participants to start on the path of financial stability. When Mrs. Jackson put funds in this account, the funds were matched at a ratio of 1: 1. After nearly two years of working with SBB and following their advice, Ms. Jackson became a first-time homeowner – a reality that she attributes entirely to the people at SBB.

In the past five years, SBB has started developing a strategy to move into more urban locations such as Little Rock, Memphis, and St. Louis. Although this move could appear at first to be a move away from SBB’s mission, this strategy falls perfectly in line with their mission because SBB’s aim is to open branches where there are large communities of underserved people. For example, rather than moving into the wealthy, predominately white, bank- saturated parts of Little Rock, SBB wants to open a branch in a predominately Black area that is “south of I-630 and east of I-30” where there are only four FDIC banks operating in the zip code. This decision to start moving into more urban areas allows SBB to not only expand the reach of its mission, it also allows the bank to grow and take advantage of scale economies while diversifying its portfolio. Today, Southern Bancorp continues to be a progressive leader both in Arkansas and in the financial institution sector as a whole in three ways: its executive make up, its legal structure, and its products targeted towards underserved communities and marginalized people. Within its executive team, each Board Chairperson of its three legs of the organization (Southern Bancorp Inc., Southern Bancorp Bank, and Southern Bancorp Community Partners) is Black, one of which is female. Of the 12 board members of the bank, half are Black, half are white, and three are women. Additionally, Darrin Williams is one of few Black CEOs of a bank that is not a Minority Depository Institution. The heavy minority representation

Today, Southern Bancorp continues to be a progressive leader both in Arkansas and in the financial institution sector as a whole.

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