By PETER SKILLERN, The Herald-Sun
June 7, 2005   1:50 pm
Wachovia Corp. recently announced that two of its predecessor banks owned slaves - the Bank of Charleston (S.C.) and the Georgia Railroad and Banking Company.  Records show the Georgia bank owned at least 162 slaves and the Bank of Charleston accepted at least 529 slaves as collateral on mortgages.  The Bank of Charleston took ownership of an unknown number of these individuals when customers defaulted on their loans.

Its apology for this legacy was coupled with a commitment to continued work for greater diversity and equality.  The bank is recognizing that its wealth today is built in part on yesterday’s oppression of African-Americans.  The Community Reinvestment Association of North Carolina suggests Wachovia and other banks examine deeper how white privilege, based on a long history of inequality, continues to create disparities and inequalities today.
 
The challenge for bank leadership is to eliminate discrimination and create diversity in hiring, marketing, lending and culture.  As one example of the need for diversity, CRA-NC worked in partnership with several banks to analyze the demographic composition of their local advisory boards.  Advisory boards do not make credit decisions, but are used to build business relationships.  Our analysis of these banks showed that statewide in North Carolina, local bank advisory boards are 90% white men, 10% women and 5% people of color.  More than 30% of the local boards have no women or minority members at all.
 
Advisory boards that are predominately white contribute to unequal outcomes in banking services.  Advisory board members have a higher level of access to credit, information and banking relationships than do nonmembers.  As a result, the benefits of inclusion accrue unequally to white males.  This is the nature of white privilege - white folks benefit from a system shaped by a history of social exclusion, without individuals necessarily being biased or discriminatory.  Without change, the inequality is self-perpetuating. The playing field is unequal and so are the results.
 
Bank employees, customers and the community at large do not miss the cultural message sent about whom the bank values.  This message is then acted on in small but important ways.  In discussion groups on race relations in banking, African-Americans consistently speak of the experience of being invisible.  This is more than a head count on diversity.  Banks that are engaged in changing the composition of local advisory boards are also changing the culture of their institutions.
 
The history of slavery and banking provides an emotional context to discussions about how race and money are still intertwined today.  Those lenders committed to eliminating racial disparities and racism within their institutions need to willingly examine where exclusion still exists.  The wealth gap between blacks and whites is still reflected in our broader community.  A commitment to leveling the field through community reinvestment, fair and equitable lending, and development in our neighborhoods is needed.  Recognizing the role of race and money in history is a starting point for recognizing the challenges of creating inclusive, fair, multi-cultural banking systems today.
 
Peter Skillern is Executive Director of the Community Reinvestment Association of North Carolina, a non-profit bank watchdog agency.