More Than 1,000 Banks in Chicago, But Only Two Are Black-Owned

Black-owned bank in Chicago
Norman J. Williams, president of Illinois Service Federal Savings & Loan
Black-owned banks in America are in trouble. Just last year, there were 25 in the entire country, according to the Federal Deposit Insurance Company (FDIC). In 2001, that number was 48. In Chicago, where the population is 32 percent black, there are only two banks remaining that are owned by blacks.

Two banks remain

The two black-owned banks remaining are Illinois Service Federal Savings & Loan, and Seaway Bank. Illinois Service is the oldest bank and has a history of lending to individuals, businesses, churches and non-profit organizations. Much of its lending is home mortgages, but according to the FDIC, more than 14 percent of those mortgages are seriously delinquent. High unemployment and declining property values were to blame for the bank losing $9 million in net losses over a three-year span which wiped out two-thirds of its capital.

While Seaway Bank does more commercial lending, Illinois Service operates much the same way it has for many years. Analysts say it will be difficult for the bank to attract an investor to help save them because it has not kept up with today's banking industry. CEO Norman Williams is working to attract investors but will need $7 million to stay afloat.

The future

If Illinois Service fails, Seaway Bank will be the only surviving black-owned bank in Chicago.

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