NEW YORK–JPMorgan Chase has announced a new long-term commitments to advance racial equity.
The nation’s biggest bank said it plans to harness its expertise in business, policy and philanthropy and commit an additional $30 billion over the next five years to provide economic opportunity to underserved communities, especially the Black and Latinx communities.
According to the bank, structural barriers in the U.S. have created profound racial inequalities that have been exacerbated by the COVID-19 pandemic. JPMorgan Chase said the existing racial wealth gap puts a strain on families’ economic mobility and restricts the U.S. economy.
“Systemic racism is a tragic part of America’s history,” said Jamie Dimon, chairman and CEO, JPMorgan Chase & Co. “We can do more and do better to break down systems that have propagated racism and widespread economic inequality, especially for Black and Latinx people. It’s long past time that society addresses racial inequities in a more tangible, meaningful way.”
JPMorgan Chase said over the next five years, it expects these new commitments, which include loans, equity and direct funding, to:
I. Promote and Expand Affordable Housing and Homeownership for Underserved Communities
The bank said it will:
- Originate an additional 40,000 home purchase loans for Black and Latinx households. To do this, it is committing $8 billion in mortgages. Efforts include improving key home lending products and offerings, including substantially increasing the Chase Homebuyer Grant in underserved communities.
- Help an additional 20,000 Black and Latinx households achieve lower mortgage payments through refinancing loans. To do this, the firm is committing up to $4 billion in refinancing loans.
- Finance an additional 100,000 affordable rental units. To do this, the firm will provide $14 billion in new loans, equity investments and other efforts to expand affordable housing in underserved communities.
II. Grow Black- and Latinx-owned Businesses
JPMorgan Chase said it will provide an additional 15,000 loans to small businesses in majority-Black and -Latinx communities. To do this, the firm will deliver $2 billion in loans. Efforts include launching a new program designed to help entrepreneurs in historically underserved areas access coaching, technical assistance and capital, and accelerating a digital lending product to better support the needs of small Black- and Latinx-owned businesses seeking quick access to capital.
It will also spend an additional $750 million with Black and Latinx suppliers.
III. Improve Financial Health and Access to Banking in Black and Latinx Communities
JPMorgan Chase said one million people open low-cost checking or savings accounts. To do this, the firm commits to hiring 150 new community managers, opening new Community Center branches in underserved communities and materially increasing marketing spend to reach more customers who are currently underserved, unbanked or underbanked. Other efforts include continuing to open 100 new branches in low-to-moderate income communities across the country as part of the firm’s market expansion initiative, and building awareness and trust in Chase Secure Banking to meet the needs of Black and Latinx unbanked and underbanked households and expand access to traditional banking.
JPMorgan said it will provide up to $50 million in the form of capital and deposits in Black and Latinx-led Minority Depository Institutions (MDI) and Community Development Financial Institutions (CDFI), and continue to mentor and advise select MDIs and CDFIs to help them achieve future success.
IV. Accelerate Investment in our Employees and Build a More Diverse and Inclusive Workforce
JPMorgan said it will be continuing to build a more equitable and representative workforce and hold executives accountable by incorporating priorities and progress into year-end performance evaluations and compensation decisions for members of the Operating Committee and their direct reports.
JPMorgan Chase said it will also provide $2 billion in philanthropic capital over the next five years to drive an inclusive economic recovery and support Black, Latinx and other underserved communities. This extends and increases the firm’s current five-year $1.75 billion philanthropic commitment made in 2018. It will also include an emphasis on supporting Black- and Latinx-led organizations.
Holding Bank Accountable
“Measuring impact and ensuring accountability is central to these new commitments. Progress will be tracked regularly and shared with senior leadership across the firm, as well as externally with the Chase Advisory Panel, to assess performance and hold the business accountable,” the bank said. “These efforts will further allow for maximum impact and bring an enhanced equity lens to the firm’s business.”