an underserved community comes with as many risks as rewards. Liberty often works with community members with a credit rating of “B” or “C” as opposed to majority banks who only play in the “safe” “A” credit rating territory. Liberty works with a deposit base that consists primarily of checking accounts and deposits that average around $400. Average loan size, including commercial loans, is about $20,000. On the flip side, McDonald says the rewards of being a major player in the community are worthwhile. “One of my childhood dreams was to have enough money to be able to give money away,” says McDonald. Today, it’s a dream he’s living out. Liberty has an extensive formalized corporate giving program. Profiled in BE (“Doing Good While Doing Well,” February 1996), the bank had to hire Bright Moments, a local public relations firm run by Bill Rouselle, just to handle the inc
reased requests for donations.
The bank is very active when it comes to supporting community-vested programs throughout New Orleans. In fact, Liberty was the foremost VA/FHA housing lender in New Orleans for 16 consecutive quarters before the federal Community Reinvestment Act required banks to extend loans to low-income families. The bank currently has an outstanding CRA rating of “1”. Liberty also has a penchant for supporting educational ventures for local students. The Liberty Track Meet, an increasingly popular sports event among the high schools, offers young athletes the chance to earn money for higher education. Last year, the outstanding male and female athletes received scholarships of $2,000 each to help toward college costs. And the “Ball in the Mall,” a formal blacktie gala, is held every January in conjunction with the Lou Rawls Parade of Stars National United Negro College Fund Telethon. The ball has raised approximately $250,000 dollars specifically for Xavier and Dillard Universities, two New Orleans-based UNCF schools.
So what’s next for Liberty? For starters, the bank has won a contract to do the cash management services for the city of New Orleans. The contract means Liberty will revamp policies and procedures and install a new management system for the money collected by the city, which totals some $200 million annually, says McDonald. As for the future, McDonald doesn’t want to reveal too much of his hand, but he admits acquiring other financial institutions is an addiction. He says Liberty recently made an acquisition offer to an Alabama-based bank, but was turned down.
McDonald also believes Liberty is poised to become one of the first minority banks to branch out from its homebase and set up shop in nearby states. “We want to position ourselves to be a one-stop shop,” says St. Etienne. “We want to be able to offer brokerage services, insurance, and be a complete financial services company. But to do that, we have to continue to grow and expand into other financial services. That’s why we open these branches to make us more convenient to more people. If we earn their trust, we’ll earn their business.” So expect more