Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Business
Speaker 1: Week with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 2: We've been talking a lot about bank earnings. Morgan Stanley
Speaker 2: reporting beating Wall Street estimates ending the day of about
Speaker 2: four and a half percent. Bank of America, second largest bank,
Speaker 2: reporting earnings as well on in the day, up about
Speaker 2: as much. And as you mentioned, Carol, a good moment
Speaker 2: to look at smaller banks as well. Of course, some
Speaker 2: regional banks is going to be reporting here in the
Speaker 2: coming days. But Terry Williams joins us now in studio
Speaker 2: here in New York, President and chief operating officer of
Speaker 2: one United Bank that's a black owned bank, digital and
Speaker 2: traditional with branches in Boston, Los Angeles, and Miami. Almost
Speaker 2: one billion dollars in loans, most in low to moderate
Speaker 2: income communities. Changes us here in the studio. Great to
Speaker 2: have you with us.
Speaker 3: Great to be here.
Speaker 2: And for those unfamiliar with the bank, tell us a
Speaker 2: bit about it. So who you serve and how you've
Speaker 2: grown here in recent years.
Speaker 3: Yes. Sure. First of all, we're a CDFI community development
Speaker 3: financial institution and our focus is on building wealth and
Speaker 3: low to mottered income communities. But we're also a digital bank,
Speaker 3: so ninety percent of our customers come to us online.
Speaker 2: Not in person, No, not in person, not in person.
Speaker 3: And we've been a digital bank for twenty years, so
Speaker 3: we really have been a long time in this space.
Speaker 3: And we're about to introduce a really exciting product. It's
Speaker 3: called Wise one, and it's a conversational virtual agent that
Speaker 3: will help people manage their money. We're doing this in
Speaker 3: partnership with Google Salesforce as well as JP Morgan and City.
Speaker 3: I would say, in this new evolution of technology, you
Speaker 3: need partners and so we've really been thrilled to have
Speaker 3: Google really help us through this and using Gemini as
Speaker 3: the tool.
Speaker 4: Yeah, that is certainly their AI tool and kind of
Speaker 4: what you know, you've got Touch ept, Open AI, you've
Speaker 4: got Google got their version one. Thing I'm going to
Speaker 4: ask you about, Terry though, when it comes to I
Speaker 4: feel like the financial community all communities, like education is
Speaker 4: such a big part and especially in I think areas
Speaker 4: where there are individuals that are unbanked or underbanked. So
Speaker 4: tell us about how that plays into because I get
Speaker 4: a little nervous when we start like going online.
Speaker 5: And figuring out things. Is there an educational component to
Speaker 5: all of this?
Speaker 3: Absolutely, In fact, it is the educational component. That's that's
Speaker 3: really what we're about. So the tool actually teaches you
Speaker 3: financial literacy by giving you actionable insights about what you
Speaker 3: can do with your money. If you say to people, oh,
Speaker 3: co take this course on money management, you know two
Speaker 3: people will sign up. But on the other hand, if
Speaker 3: you say, hey, you could move some money from spending
Speaker 3: to checking, or hey, I noticed that you know your
Speaker 3: mortgage rate is a little high, or hey that I mean,
Speaker 3: if you give people actionable insights and things that they
Speaker 3: can do, Hey, here's a budget, here's a budget tool,
Speaker 3: people really respond to that. And we've had a money
Speaker 3: management tool actually for a couple of years and our
Speaker 3: customers love it. What we're adding to it with Google
Speaker 3: AI is really the conversational agent piece which is going
Speaker 3: to take us over the top.
Speaker 2: So Carol mentioned the the unbanked and the underbanked, and
Speaker 2: I'm curious sort of how you've found outreach to those
Speaker 2: communities and what success you've had convincing folks that they
Speaker 2: should open up a bank account, that it's important to
Speaker 2: have one. And indeed, helping them go through that process.
Speaker 3: So our focus is really to talk about every spectrum
Speaker 3: and so on the underbanked, I'll call them people that
Speaker 3: have check systems records that aren't able to open up
Speaker 3: a bank account. We have something called a second chance
Speaker 3: checking account. It's called YouTube checking, and it allows people
Speaker 3: that and actually a pretty large percentage of Americans have
Speaker 3: check systems records. And in fact, if you don't have one,
Speaker 3: you probably even know what that is.
Speaker 5: I don't even know that we have one. I just
Speaker 5: assume that somebody has tons of information.
Speaker 3: Yeah, yeah, And.
Speaker 2: So it's just like cards, right.
Speaker 3: You hear about FYCO scores and credit scores, but it's
Speaker 3: actually a score for your use of bank account. And
Speaker 3: if someone has a check systems record, they're not able
Speaker 3: to go into a bank and open up an account,
Speaker 3: but we give them a second chance. So that's an
Speaker 3: example of where we're really bringing people in. We also
Speaker 3: have this wonderful service called cash Please, where people can
Speaker 3: get a small short term dollar loan up to one
Speaker 3: thousand dollars with no credit check. Again, it's a way
Speaker 3: of us serving the load of mottered income, you know,
Speaker 3: underbank community. At the same time, on the other spectrum.
Speaker 3: Everybody needs a budget. Everybody needs to know how to
Speaker 3: manage their money. And to be a GPS for your
Speaker 3: money is what you remember when we used to use maps. Yeah,
Speaker 3: so the AI tool will be a GPS for your money.
Speaker 3: So and everybody needs that.
Speaker 4: When you give like a thousand dollars loan for someone
Speaker 4: that you know may not be able to get it elsewhere,
Speaker 4: what's the interest rate on something like that? What's the payment?
Speaker 3: Yeah, that's the great question. So if you go to
Speaker 3: a payday lender, is three or four hundred percent?
Speaker 5: That's crazy?
Speaker 3: Wow? Are right? It's twenty two and a half percent.
Speaker 5: That's still crazy.
Speaker 4: I'm sorry, Like I have a real hard thing full
Speaker 4: disclosure so time, but I mean the rates for even
Speaker 4: people with good credit score, Like it's just crazy.
Speaker 3: But for if you have a bad credit score, you
Speaker 3: can't get a loan or unless you go to a
Speaker 3: payday lender and pay three or four hundred percent. Yeah,
Speaker 3: by twenty two and a half percent with no credit
Speaker 3: check is actually a great rate. And I will say.
Speaker 5: How long people pay us back? Yeah?
Speaker 2: Howay?
Speaker 5: Yes, yeah, it's a short term loan.
Speaker 3: It's three months and they pay us back and we
Speaker 3: won't allow them to roll it over. So that's the
Speaker 3: other thing. And we also report to the credit bureaus,
Speaker 3: so you know with payday loans, they only report if
Speaker 3: you don't pay with our cash please. We actually report
Speaker 3: positive payment and I think that is another reason that
Speaker 3: people use it, pay it back and improve their credit score.
Speaker 2: As I mentioned, we've been following these big banks that
Speaker 2: have been reporting, and we hear from their chief executives
Speaker 2: just about how they're thinking about the economy and the
Speaker 2: trends that they're seeing. I'm very curious sort of if
Speaker 2: that if that fantasi is different, the one that you
Speaker 2: have is different, and what you're thinking about the direction
Speaker 2: of this economy, the level of uncertainty that we're seeing,
Speaker 2: how that's playing on the communities that you serve.
Speaker 3: So we definitely are seeing draw down in savings. We
Speaker 3: are definitely seeing We have actually a financial literacy essay
Speaker 3: contest for kids and this year there's two things we saw.
Speaker 3: One is that the kids are using AI to write
Speaker 3: their essays and the other is that they're talking about
Speaker 3: you know, pakaboots, PoCA book issues. They want to win
Speaker 3: so that they can help their family by groceries and
Speaker 3: that's the This is the first we've had this contest
Speaker 3: for fifteen years. This is the first time that that
Speaker 3: kind of feedback from children is coming out. So we
Speaker 3: can definitely feel that the economy, you know, is not
Speaker 3: st Yeah, it's a strength, there's a strain at the
Speaker 3: same time. And again, I don't want to keep going
Speaker 3: on about wise one, but people want a budgeting tool.
Speaker 3: They recognize that they need guardrails, they need information. They
Speaker 3: need more than just what's my balance, you know, they
Speaker 3: want to know how can I improve my spending? How
Speaker 3: can I improve my credit score? And that's where we come in.
Speaker 4: No, I love that, but it really disheartens me to like,
Speaker 4: I feel like this is something we've been talking a
Speaker 4: lot about Main Street versus Wall Street. I mean, here
Speaker 4: we have, you know, records on Wall Street or you know,
Speaker 4: there's certainly big pockets of this economy that have done
Speaker 4: very well and have gotten wealthier, and then there's just
Speaker 4: so many that have not tell us a little bit
Speaker 4: more about your clientele and who is your customer and
Speaker 4: what you know, we need to understand.
Speaker 5: About different pockets of the US population.
Speaker 3: Yeah, so what I will say is that there are
Speaker 3: a lot of wealthy people as well as corporations that
Speaker 3: really support what we do. I mean, I you know,
Speaker 3: I can't tell you how many, like a lot of corporations,
Speaker 3: a lot of wealthy individuals that have deposits in the bank,
Speaker 3: that really understand what we do, why we do it.
Speaker 3: They may not do it, but they really support how
Speaker 3: we're doing it, and we're we're maniacal about doing it.
Speaker 3: So they're like, great, you know, we can't turn our
Speaker 3: big ship to focus on every community, but we love
Speaker 3: the fact that you were doing.
Speaker 5: So they're depositing at your bank. Yes, yes, as our
Speaker 5: sign of support or yes.
Speaker 3: As a sign of support as well as it gives
Speaker 3: us dollars to lend to the community. And because we've
Speaker 3: had like almost zero losses, they're they're supporting us so
Speaker 3: and I would even say even that, you know, Google
Speaker 3: as an example, they didn't have to step in and
Speaker 3: help us, you know, develop this tool, but they saw
Speaker 3: that this is a way to use AI for good.
Speaker 3: You know, you hear a lot of crazy stuff about it.
Speaker 3: We're really trying to get our community to embrace it,
Speaker 3: not be afraid of it, to realize that there is
Speaker 3: a good use of it. I mean, you remember when
Speaker 3: we were afraid of online and mobile banking, but people
Speaker 3: were afraid.
Speaker 5: I'm still afraid. Yeah, I'm probably more afraid today than
Speaker 5: I was when I started.
Speaker 4: Just to be fair, no, but I just think, you know,
Speaker 4: it's interesting all the stuff that's going on digital.
Speaker 5: So is most of your business deposits? Is it long? Like?
Speaker 5: Give us an idea?
Speaker 3: Yeah, you're going First of all, as I said, ninety
Speaker 3: percent of our customers come to us online, right, even
Speaker 3: the corporations, they're located all across the world, and they
Speaker 3: come to us and deposit. We focus our lending is
Speaker 3: on supporting affordable homes, so multi family affordable housings with
Speaker 3: the rent is below the average for the communities that
Speaker 3: we're in. Again, cash Please is a big one. We've
Speaker 3: done thousands of cash Please loans. We also have a
Speaker 3: secured credit card again to help people rebuild their credit.
Speaker 3: That's the lending tools. We also focus on home ownership.
Speaker 2: I want to ask you about the other ten percent
Speaker 2: then of your customer base. So you do have some
Speaker 2: geographic footprint and as you think about expansion or where
Speaker 2: you want to be, how do you how do you
Speaker 2: think that through? Are you are you happy in the
Speaker 2: cities that you're in or where else would you see
Speaker 2: opportunity and kind of if you're not going to name names,
Speaker 2: what are the kinds of places where you would want
Speaker 2: to have a footprint.
Speaker 3: We love the cities we're in. We you know, what's
Speaker 3: happening in Boston and Miami and the tech world is
Speaker 3: just amazing, and we're we're really a fintech that's also
Speaker 3: a community bank, and that's the the great thing about
Speaker 3: us is when you put your money with us, you
Speaker 3: have the benefit of the regulatory you know, environment and
Speaker 3: all that that comes with, as well as the fact
Speaker 3: that you can bang with us online. So we're really
Speaker 3: excited about what's happening, particularly in Miami these days, as
Speaker 3: well as what's been going on. Our IT team is
Speaker 3: in Boston and we love it. And then la is
Speaker 3: just such a huge market, it really is. And we're
Speaker 3: in Compton. I mean we're down in South Central on
Speaker 3: a quench out boulevard. So we really like the communities
Speaker 3: we're in. We're always looking for other opportunities and really
Speaker 3: I would have to do a shout out to all
Speaker 3: black banks. We're located in major cities and we really
Speaker 3: do serve the communities.
Speaker 5: One last question thirty seconds.
Speaker 4: Is there anything that you would like to see in
Speaker 4: terms of policy changes that would help what you are doing.
Speaker 3: It's a good question. Well, I do like what we're
Speaker 3: seeing on AIK that there is flexibility. We're introducing this tool.
Speaker 5: And the relators are not saying no, okay no.
Speaker 3: I mean that's huge. Yeah, I mean, I can't tell
Speaker 3: you how huge that is. I've been in banking for
Speaker 3: thirty years and we're not getting no for like, you know,
Speaker 3: one of the first times yet.
Speaker 5: I'm just kidding. I'm gonna think positively for you, Terry,
Speaker 5: Thank you so much.
Speaker 3: Yeah, thank you, thank you for having me.
Speaker 4: Terry Williams, President, chief operating Officer of One United Bank
Speaker 4: joining us here in studios.