America's biggest bank is pledging to invest $30 billion to help close the yawning wealth gap between people of color and whites in the U.S.
JPMorgan Chase said Thursday it plans to funnel that money into Black and Hispanic communities over the next five years, with the money going toward funding 40,000 new mortgages, 100,000 affordable rental units and 15,000 small business loans.
"Systemic racism is a tragic part of America's history," JPMorgan Chase CEO Jamie Dimon said in a statement announcing the $3.2 trillion bank's racial justice initiatives on Thursday. "It's long past time that society addresses racial inequities in a more tangible, meaningful way."
JPMorgan is also raising its five-year philanthropic commitment to $2 billion, from the $1.75 billion it promised in 2018.
In an effort to serve the needs of the unbanked — those who don't have a primary checking account and must rely on high-cost financial services such as check cashing — JPMorgan also said it is expanding access to traditional banking. The company wants to add 1 million Black and Hispanic checking or savings account holders.
Yet another $50 million will be invested in Black- or Hispanic-owned banks in the form of capital and deposits. Community banks, which play a key role in helping local businesses and families thrive, have seen their numbers decline in recent decades.
The widening gap in wealth and income between Black and White Americans has perpetuated festering inequities in housing, education and health care. In 2019, for example, 44% of Black households owned their homes, compared with 74% of White households, according to Redfin.
Net worth for white households grew 43%, to $61,200, between 1995 and 2016, while household wealth for Black families remained flat at $35,400, according to Federal Reserve data.
The coronavirus pandemic has illuminated that divide, includingamong Black and Hispanic families and higher death rates from COVID-19.
Advocates for people of color applauded JPMorgan's financial commitment. The billions in funding "will address decades of systemic racism toward Black communities," National Urban League CEO Marc Morial said in a statement.
Janet Murguía, CEO UnidosUS, in a statement said the money would "help ensure that the American dream is accessible to more Latinos today."