Data shows poor communities of color in Southern California most affected by bank closures

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Los Angeles (KABC) – A week after Arcadia’s bank branch closed, workers emptied the building and threw a sign in the trash.

It’s a scene happening all over the country. According to the National Community Reinvestment Coalition report Between 2008 and 2020, more than 13,000 bank branches were closed in the United States, representing 14% of all branches.

Customer Susie Kronin said she understands why some branches are closing, but “it’s a problem if you have to go to the bank.”

Locally, between 2017 and 2020, Los Angeles County lost 62 bank branches. Then, in 2021, the county lost 66 more. Federal Deposit Insurance Corporation data, same data analyzed by NCRC.

“It’s ridiculous because people have money there. They need it and they have to make a deal. They don’t just have to use ATMs, ”he simply said. Another customer who wanted to use, said Rudy.

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Many people bank online, experts say, and the COVID-19 pandemic may have made it even worse. Many branches say the cost of real estate isn’t worth it, but a significant portion of Americans still visit bank branches at least several times a year.

Jason Richardson, NRC Research Director, said:

According to Richardson, the closure of a bank branch in the community reduces the availability of credit and loans for businesses in the area.

“We cannot deny the strong relationship between branches and small business loans,” he said. “That is, where there are few banks, there will be less business.”

Data shows that bank closures are having a significant impact on low-income communities of color.

In low-income, high-minority areas of Los Angeles County, the county as a whole fell 12% between 2017 and 2020, down from just under 4%, according to an NCRC report.

“Branches are a conduit for capital invested in low income areas, and we are concerned that branches are starting to disappear from low income areas,” said Richardson.

ABC7 analyzed the latest FDIC data for 2021 and found that it had an average of less than 20% colored postal codes and more than 5 banks per 10,000 people. Postal codes with more than 80% of the colors were less than two banks per 10,000 people.

There was a similar trend for income. Postal codes with a median household income of less than $ 50,000 were less than two banks per 10,000 people, and postal codes with a median household income of more than $ 120,000 were nearly four banks per 10,000 people .

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According to Richardson, the Los Angeles County bank branch map shows the cluster “where you expected.”

“Where the black population is high, there aren’t a lot of banks, it’s like an island in the middle of LA County… there are a few banks, but not that many,” he said.

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Richardson also said it would make shutting down the bank a matter of justice.

“Banks intend to make decisions that benefit them, but the overall impact of this means low-income minority areas will be disproportionately affected. So… it’s a constant challenge. . “

Richardson said this trend is expected to continue with the merger of some large companies.

“I don’t know where to stop,” he said. “There will probably be a certain natural level that he will reach.”

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Data Shows Poor Communities Of Color In Southern California Most Affected By Bank Closures Source Link Data Shows Poor Communities Of Color In Southern California Most Affected By Bank Closures


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