Harlem Community Bank Bailed Out by Wall Street

By Ben Fractenberg on October 25, 2011 5:00pm 

Carver Federal Savings Bank was pulled from the brink by a $55 million investment from a group of Wall Street firms and the U.S. government.
Carver Federal Savings Bank was pulled from the brink by a $55 million investment from a group of Wall Street firms and the U.S. government.
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HARLEM — Shareholders of Harlem-based bank Carver Federal Savings Bank voted Tuesday to approve a bailout from Wall Street firms and the U.S. government, Crain's New York Business reported.

The $55 million sale is expected to save Carver, which describes itself as the "largest African-American operated bank in the United States."

“This represents a significant shift from community ownership to corporate,” an investor told Crain's. “What's our future with all the outsiders whose interests may be different from ours?”

The new bank owners reportedly included Goldman Sachs, Morgan Stanley and Citigroup.

The bank reportedly lost $40 million in 2010 and was hit especially hard when the real estate bubble burst.

“There was no alternative,” Carver CEO Deborah Wright told Crain's after a shareholder meeting. “The amount of capital we needed wasn't available locally.”

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