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Football with the NFL logo.
Jacob Kupferman | Getty Images
The National Football League is doing great work to increase lending in underrepresented communities.
The league is borrowing $78 million from a syndicate of black and minority owned banks and community development financial institutions.
The loan deal will generate “tier 1 capital” for banks and credit finance institutions (CDFIs). According to the National Black Bank Foundation, it will boost Their lending power is in the millions through bank fees and interest. The full terms of the loan have not been released.
However, Joe Sickler, the NFL’s executive vice president of finance and league policy, said the terms are “at market rates,” and the league plans to fully utilize the loan over the next three years.
“These banks play a vital role in our overall economy and many of them are in the markets that our teams play in, so there is good synergy there,” Seklar told CNBC.
“These community banks sometimes have a hard time weathering economic times. When large companies like the National Football League can partner and provide reliable sources of income, it helps those community banks continue to do the great work that they do in their communities,” he added.
The NFL deal comes on the heels of a similar $35 million loan tied to the NFL Atlanta Hawks National Basketball Association for a practice facility in 2020 and a $25 million loan with football League In 2022, both are arranged by the NBBF and a syndicate of black-owned banks.
Ashley Bell, founding partner of the National Bank of Bahrain, hopes that these deals will prove that black- and minority-owned banks are viable long-term partners for large corporations, especially with the risk of an economic downturn or recession potentially having a greater impact on communities of color.
“These banks lend money to people and businesses that need it without being predatory. That gives them some breathing room. These banks are centers of hope all over the country. Whether it’s Martin Luther King Jr. Drive or Main Street,” Bell said. These are the places people go for opportunities and by supporting these institutions, the NFL is supporting these communities.”
NFL consulted with American bank And the National Bank of Bahrain for his loan.
“It’s certainly a necessary shot in the arm at a time when community banking is being questioned,” Bell said.
Bell said the regional banking crisis triggered by the collapse of the Silicon Valley bank in March has the potential to destabilize many black and minority financial institutions. In many cases, the NBBF says, black and minority banks are “very local,” providing 85% or more of loans to underrepresented groups in their area.
“Doing a deal with an entity like the NFL, it helps your brand. It helps people understand that you can do a complex deal. So if you can do a deal with the NFL, you can certainly trust that bank with your home loan,” Bell said. You can definitely trust this bank with a line of credit for your business, church and religious institution. You can go to them and trust that you will get the best service.”
The NFL’s involvement would create an opportunity for black and minority-owned banks to generate income and then invest that money in the community, according to Dominic McGartan, CEO of Optus Bank in Columbia, South Carolina, one of 16 financial institutions participating in the loan.
“The NFL gives us this opportunity to participate, strengthening our ability to fulfill our mission to serve customers and communities that are underserved, underserved, and high potential communities,” he said.
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