In an effort to work toward closing the racial wealth gap, Major League Soccer (MLS) will participate in a first-of-its-kind deal with Black-owned banks.
According to MLS Soccer, the partnership includes a $25 million loan from a syndicate of Black-owned banks and will serve as a defining moment in history because there has never been a major commercial transaction “exclusively” between Black banks and a major sports league.
“Major League Soccer’s partnership with the National Black Bank Foundation is a tangible step in the efforts to close the racial economic gap in the United States, and it’s the right business decision for us,” said MLS Commissioner Don Garber in an official statement. “As a league, we continue to increase our initiatives in support of racial justice. In order to make a genuine impact, economic justice must be part of the equation. This transaction with a syndicate of community-focused Black banks is an important measure, and it is our hope this will raise awareness of the importance of Black-owned banks and their impact on the economy.”
AfroTech has previously covered what Black-owned banks are up against when it comes to a fair shot among its competitors. Now, history will be made in the new deal between the National Black Bank Foundation (NBBF) and MLS.
“Major League Soccer has raised the bar for corporate America with this transformative partnership,” NBBF co-founder and general counsel, Ashley Bell, said. “If other leagues and major corporations follow the MLS model, lives of Black families all across this country will change for the better because their local Black bank will have the capital resources to approve historic numbers of home and small business loans.“
The syndication team created to fulfill the promises of the new deal will be spearheaded by Atlanta-based Citizens Trust Bank and New York-based Carver Federal Savings Bank. It is imperative to note that something like this has the opportunity to make long-lasting economic change when it comes to closing the racial economic gap that affects dozens of citizens across the nation.
Other key stakeholders who will serve as members of the syndicate include Alamerica Bank, Carver State Bank, Columbia Savings & Loans, Mechanics & Farmers Bank, and Unity National Bank. The financial and syndication advisor is Comer Capital Group, LLC with Dentons US LLP serving as counsel.
A Change Has Come
In a study conducted by the Federal Reserve, research revealed that the Black-white economic gap in America has been left “virtually untouched” since the Civil Rights Movement that took place during the 1960s.
The gap is proof that Black Americans face a disadvantage when it comes to generational wealth, funding for businesses, homeownership, and more. This is the reason why a deal of this scale with Black-owned banks is so important. When lenders refuse to acknowledge the race disparities that hinder Black people from certain opportunities, it is Black-owned banks that often come to the rescue.
Not only will the transaction have a huge effect on access to essential financial services, but the new partnership also plans to increase Black representation within the sport.
“Throughout America’s history, sports have been the backdrop for major turning points in our ongoing battle for racial and economic justice, and MLS’ new partnership with Black banks is a landmark moment in that legacy,” said New York City FC Vice Chairman and Jackie Robinson Foundation Co-founder Martin Edelman. “Sports have the platform to bring diverse coalitions together and to capture the nation’s attention; what MLS is doing today is nothing short of historic and will have far-reaching impacts on Black families, Black businesses and Black communities looking to build wealth.”