Louisville Community Development Bank (LCDB) is an FDIC-insured commercial bank. Its mission is to revitalize the poverty riddled neighborhoods of Louisville, Kentucky, by stimulating economic growth through targeted loans. The bank is a self-sustaining institution and does not rely on public funding or grants to keep its doors open. LCDB has made loans totaling over $49 million to over 364 different companies. These loans have created or maintained 1,317 jobs.
LCDB achieves its mission by:
- Supporting small business development and expansion
- Making home renters into homeowners
- Improving the quality and value of real estate
- Increasing the number and quality of goods and services available
- Creating jobs and linking neighborhood residents to employment
LCDB accomplishes economic growth by making targeted loans. Both residential and business loans are available for homes or businesses located within the targeted neighborhoods. Outside businesses also may qualify for loans, provided they are committed to hiring residents from, or providing new services to the inner city.
Loans are funded by CD purchases. These CDs, owned by individuals, corporations, and institutions such as Calvert Foundation, provide the lending capital for LCDB's programs and services.
Rather than take a welfare-like approach to reversing poverty, Louisville Community Development Bank is giving residents the opportunity for meaningful, living-wage employment and homeownership in a safe, clean neighborhood. LCDB accomplishes this by making fair credit loans to businesses that will either relocate to or expand their services within these neighborhoods. This creates new job opportunities for area residents. Loans are also made to homeowners wishing to repair or remodel, and to individuals that will rehabilitate abandoned or dilapidated properties for commercial use.
LCDB concentrates its development and revitalization activities in the neighborhoods in Louisville where help is needed the most69 census tracts that are designated by the Federal government as "Distressed Communities". More than 230,000 of the bank's neighbors resides in these census tracts. Unemployment in these census tracts is nearly twice the national rate. Twenty-six percent of these residents, including 23,106 children, live below the poverty level.
The population in the target area is 75 percent African American, 24 percent Caucasian, one half percent Latino, and one-half percent Asian/Pacific Islander. LCBD does not track the gender of its borrowers.
Since 1997, LCDB has made over $49 million in loans to over 364 businesses, creating or maintaining 1,317 jobs. In 2005 alone, LCDB made $4.3 million in loans that created or saved 42 jobs, of which 72 percent went to Distressed Communities, 21 percent to women and 73 percent to minorities.
The impact of Louisville Bank's unique approach to community development is far-reaching. The local economy receives an immediate boost from each loan through an increase in localized spending. The largest impact comes from the permanent creation of new jobsjobs filled by inner city residents gaining tools for self-sustainability.
In Lousiville, Kentucky, a neighborhood that once held “Murder Corner” is now one of the most desirable neighborhoods in the city. Soon after LCDB opened, it began to work with the old Cotter/Lang housing project, which was aging, dirty, and riddled with crime. Now, with the help of LCDB and a unique subsidy program offered by the government, Park DuValle has 450 owner-occupied homes, 600 rental units, schools, a community center, houses of worship, and neighborhood shops. The area is a truly mixed income neighborhood, allowing first-time, low-income homeowners to live in a safe and lively neighborhood. Full Story