More Help on the Way

Founders National Bank, the only black-owned commercial bank in the state, can provide more services and loans to capital-starved South Los Angeles because of a $1-million investment from Bank of America. That commitment should translate into loans to start or expand businesses that will provide jobs.

Founders is also buying two Security Pacific branches that had been scheduled to close because of Security’s merger with B of A. One branch is at Western and 43rd, in an area almost overlooked by financial institutions. Fewer than 20 banks and savings and loan institutions serve nearly 590,000 people who live in a 40-square-mile area of South-Central Los Angeles, according to the Los Angeles Community Reinvestment Committee. Many people there are forced to depend on the ubiquitous--and some would complain usurious--cash-checking services.

Founders, which has only two branches, is eager to expand. B of A is speeding up that process. The B of A deal is expected to push Founders’ deposits above $100 million. The state’s largest bank is also loaning Founders $1.9 million to repay the Resolution Trust Corp. A group of black investors borrowed from the RTC to reorganize Founders, once one of the nation’s largest black-owned thrifts, after it failed some years back.

Because Founders is the only bank headquartered in the inner city, it is well-positioned to encourage the recovery from last spring’s riots. That recovery is being nurtured by banks, businesses, community groups--and the National Football League, which is donating $1.5 million to build a new community youth center in South-Central Los Angeles. The NFL-Youth Educational Town will also be financed through a $1-million commitment from Garth Brooks, the popular country singer, who dedicated concert proceeds. His generosity should inspire others. Rebuilding Los Angeles will take plenty of human capital, and plenty of financial capital.