RGV MultiBank History

How did it all happen?

  

In February 1994, six (6) financial institutions were invited to become educated on, discuss, analyze, and determine their interest in investing in an alternative financing vehicle for affordable housing within Cameron County. Two (2) of the institutions were minority-owned banks.


A series of meetings were held with the CEO's of each of the six (6) financial institutions. Education on community development corporations, their relation to the banking community, a review of bank regulatory conditions, areas of focus, community involvement, structuring, administration and operations, relation to ongoing community development activities, legal and political considerations were analyzed and discussed. The six lenders also reviewed loan declinations made to small business by their commercial banks, and identified the need for a flexible equity investment pool that could leverage more traditional lines of commercial credit.


A preliminary "Investment Proposal," as well as draft Articles of Incorporation, By-laws and Administrative agreements, were prepared based on the CEO's discussions. These were reviewed and revised over a four-month period.


Following the initial education, consultation and discussion process, each of the institutions was invited to decide on participation in forming a multibank community development financial institution and their potential investment level. Five of the invited financial institutions pledged capital commitments totaling $1.2 million dollars. The Comptroller of the Currency and State of Texas banking regulators granted permission to invest for the four (4) federally chartered, and one (1) State of Texas chartered banks in April 1995.


Initial capital was paid in April 1995, and the first Board meeting was held in May 1995.  Initial investing stockholder banks were Mercantile Bank (now Wells Fargo), International Bank of Commerce, Brownsville National Bank (now BBVA Compass), Texas Commerce Bank (now JPMorgan Chase), Bank of America, and the National Cooperative Bank of Washington, D.C. In March 2001, the Corporation expanded its investment area to include Hidalgo, Starr and Willacy Counties. Three new equity investors included Frost National Bank, Lone Star National Bank, and International Bank of Commerce-McAllen and in 2015 International Bank of Commerce-Zapata purchased stock.  In 2017, The Community Development Corporation of Brownsville purchased stock. In 2016, JPMorgan Chase sold their $300,000 initial stock purchased back to the RGVMB for $1.


In 1996, the RGVMB received certification as a Community Development Financial Institution (CDFI) from the United States Department of Treasury. The Corporation’s most recent recertification was received in 2017. 


In 2011, the RGVMB created the Community Loan Center (CLC) www.rgvcommunityloancenter.com. The RGVMB launched a very successful consumer loan product to directly compete with high costs, short-term loans readily available in the marketplace.  The SDL program is an on-line, employer-based, low-cost alternative to payday loans.  


In 2013, the RGVMB became the first CDFI to become a member of the Federal Home Loan Bank of Dallas.


Current total common stock is $2.13 million and $1.31 million in additional paid in capital. Total assets equal $12.65 million and total equity equals $4.1 million.