New Haven’s fledgling community bank is one step closer to opening.
First Community Bank of New Haven, as it’s tentatively called, received a temporary charter Friday from the State Department of Banking.
That means the bank is on track to open branches on Whalley Avenue and on Grand Avenue in the first quarter of 2010, President William Placke said Monday. Now that the state has given its OK, federal regulators can “do their due diligence” and conduct a formal review to allow the bank to open, Placke said. The bank needs approval from the Federal Reserve and the Federal Deposit Insurance Corp.
Click here to read a release issued by the bank.
Meanwhile, Placke reported, the bank has reached an agreement with the landlord to open its headquarters and its first branch at 299 Whalley. He’s also negotiating with developer Angelo Reyes to open the second branch, in Fair Haven, at 258 Grand.
The bank will be a for-profit subsidiary of a not-for-profit called First City Funding Corp., which formed with $25 million from a deal struck after the old New Haven Savings Bank converted in 2004 from a local mutual savings bank into a regional publicly-owned colossus-in-the-making called NewAlliance. The idea was to find a way to keep loans flowing to potential homeowners and small-business owners in neighborhoods like Fair Haven and Dixwell and the Hill as traditional local banks disappear.
The idea behind the new bank: stay completely rooted in New Haven, with a mission not just to earn a return for shareholders, but to lend money for people to buy homes and start businesses in city neighborhoods.
Such “community development banks“ have sprung up across the country the past few decades. Prime examples: Chicago’s ShoreBank (the granddaddy), City First in D.C., and North Milwaukee State Bank.
The New Haven bank will be looked to as a player in addressing the city’s foreclosure crisis.
Another key feature of the new bank’s plan: financial literacy. That means advising people on how to be smarter with their money so they don’t get ripped off by predatory lenders. The bank plans to have financial counselors inside its branches and to hold classes off-site, perhaps at Gateway for adults and in city schools for kids.
The bank’s been in the planning stages since 2004. It has hit a few bumps along the way. It got back on track when Placke came to town last year to take it over.
The bank may even have an official name soon. First Community is its working name.
“I’m considering another name as we’re speaking,” Placke said Monday. “I can’t divulge it at the moment.”
Too bad Mr. Placke is just keeping the seat warm until King Johnny gets tired of being Mayor and decides he wants to be a banker.