ShoreBank
 |
|
| Community Development Bank | |
| Fate | Insolvency |
| Successor | Urban Partnership Bank |
| Founded | 1973 |
| Defunct | 2010 |
| Headquarters | Chicago, Illinois |
|
Key people
|
Ron Grzywinski, Mary Houghton, George Surgeon |
| Products | Financial services, microfinance |
| Total assets | $2.6B USD (2008) |
| Parent | ShoreBank Corporation |
| Website | sbk.com |
ShoreBank was a community development bank founded and headquartered in Chicago. At the time of its closing it was the oldest and largest such institution, and in 2008 had $2.6 billion in assets. It was owned by ShoreBank Corporation, a regulated bank holding company.
ShoreBank had branches in Chicago’s South and West sides, Cleveland, and Detroit. Between 2000 and 2006, ShoreBank issued nearly $900 million in loans to citizens in Chicago, Detroit, and Cleveland. ShoreBank and its affiliated companies have projects in 30 countries.
ShoreBank incorporated environmental conservation into its mission during the 1990s, helping develop a triple bottom line approach to banking, equally prioritizing profits, impact on people, and the impact of a project on the environment.
ShoreBank accepted mission-based deposits from across the country through its Development Deposits program, launched in 1982, and its online savings account ShoreBank Direct, launched in 2007.
Although mission-based, the bank's financial performance historically matched or exceeded that of its peer banks. However, the bank faced significant losses in 2009, and as of May 2010 was seeking $200 million in additional capital from major investors and the U.S. government. The bank's losses were related to the recession, though it was not engaged in subprime lending.
ShoreBank corporation was the first bank holding company to combine commercial banking, real estate development, nonprofit loan funds, and international advisory services aimed at community development. Originally developed as a neighborhood development bank for low-income African-American communities, ShoreBank eventually expanded nationally and internationally.
It exceeded its goal of private capital commitments but did not receive requested government support, a condition of the private investors. In August 2010, the bank faced possible insolvency and risked having its deposits taken over by the Federal Deposit Insurance Corporation, which insured its deposits. On August 20, 2010, the bank was declared insolvent, closed by regulators and most its assets were acquired by Urban Partnership Bank. Some of the more recent management hirees of ShoreBank, in an unprecedented move by the FDIC, have been allowed to continue to run the restructured bank, now a part of Urban Partnership Bank. According to the FDIC, the recent hirees "did not contribute to the bank's problems." Sheila Bair, head of the U.S. Federal Deposit Insurance Corporation, devoted several pages to the lack of federal support in her 2012 book and commented that the FDIC sought approval of the injection of federal funds several times, to no avail.
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Wikipedia