Thursday, September 6, 2018

Crain's: Urban Partnership Bank finds a buyer

Another great article by Crain's Steve Daniels, this time about Urban Partnership Bank:
The ShoreBank saga appears to be nearing a definitive end as south suburban lender Providence Bank & Trust looks to acquire the legendary failed community bank’s successor.

Urban Partnership Bank, the lender established in 2010 to take over the ShoreBank franchise after the high-profile urban community bank’s demise, is throwing in the towel.

The South Side bank has an agreement to sell to Providence Bank & Trust, based in south suburban South Holland, the companies announced today. The deal brings to a close UPB’s effort to continue the “mission” of ShoreBank, for decades a bank renowned for lending actively in low-income urban neighborhoods neglected by other banks until it foundered on hundreds of millions in bad loans following the housing bust and Great Recession.

Still, David Vitale, longtime Chicago banker and chairman of UPB, said in an interview he was pleased to find a buyer interested in furthering ShoreBank’s legacy. Having shrunk dramatically from an asset size that had well exceeded $1 billion, UPB wasn’t able to attain its goals, he said.

“The ability to do what we wanted to do at that scale, with the regulatory costs, put our future into question,” he said. “We’re feeling excited for our customers and our communities that someone was willing to invest in us and our communities.”

Providence Bank & Trust is an interesting story in and of itself. Launched in 2004, just six years before UPB, the bank glided relatively unscathed through the financial crisis when most bank startups from that time frame went belly up. It has 12 branches located mainly in the south suburbs, with a few in northwest Indiana.

The acquisition of UPB will give Providence its first presence in the city.

Describing itself as a “stewardship” bank, Providence donates 10 percent of its profits each year to nonprofits and other causes.
To be honest, I would've liked it if some Black investors who hopefully were unscathed by what happened with Seaway Bank for example could've gotten it. Thus we could have another Black-owned bank in the community. Just shows banking is a very difficult business right now or certainly it always has been.

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