2021 CSBS Community Bank Case Study Competition Journal

THIRD PLACE: Southeastern Louisiana University economic disparities by providing online and in person seminars to educate individuals about credit, investing, and other financial literacy topics. To help create attendance to these “We promote financial literacy, healthy asset building and sustainable

events, Liberty also uses customer relationships with local churches to inform the congregation about educational opportunities. Liberty understands what causes the disparity of minority communities and has become skilled at unlocking the untapped potential in what other banks see as depressed markets. Liberty entered the Detroit market in 2009 by purchasing Home Federal Savings Bank when they discovered local banks were not lending for housing in the depressed areas (Henderson). The area had seen a severe lack of housing purchases for over a year, creating a gap for accurate housing appraisals, something local banks required in order to meet lending policies (McDonald et al.). The lack of recent market activity comparisons, which helps to derive a property’s value, made it difficult for residents to meet local banks’ increasing collateral requirements (McDonald et al.). To solve this problem, JPMorgan Chase provided Liberty Bank with a $5 million loan loss reserve to offset the risk of lending in these depressed areas (Henderson). Liberty was then able to provide local residents with the ability to purchase properties at tax auctions, restore the homes, and insert them back into the market. This gradually created more recent purchase comparisons for the area and a path to recovery. Other banks followed Liberty’s lead. These deteriorating sectors of Detroit are now being revitalized, thanks to Liberty’s innovation.

Impact Made by Liberty’s Small Business Lending Transcends Race to promote economic development Liberty directly influences the opportunities for those who can least afford them; shifting the burden. They directly level the playing field for African-American communities. But Liberty’s impact reaches even farther into all communities. Liberty provided Team Southeastern with information from their Louisiana loan portfolio banking practices that lead to stronger individuals, families, businesses, communities and cities. We create opportunities for those who can least afford them–shifting the burden, leveling the playing field– and we proudly fulfill our responsibility as a responsive, dedicated and steadfast community advocate.” —Liberty Bank and Trust Company

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