Minority Ownership and TARP Investments

25 Pages Posted: 9 Apr 2013 Last revised: 24 May 2013

Lucas Puente

Stanford University - Department of Political Science

Linus Wilson

University of Louisiana at Lafayette - College of Business Administration

Date Written: May 23, 2013

Abstract

Minority and black owned banks were significantly less likely to receive funds from the Troubled Asset Relief Program (TARP) Community Development Capital Initiative (CDCI). A non-minority bank with the median characteristics was approximately ten times more likely to obtain TARP funds than an African American owned bank after controlling for other factors. We also find prior TARP recipients and banks with fewer troubled assets were more likely to obtain money from this program.

Keywords: Barney Frank, bailout, CDCI, CDFI, Community Development Capital Initiative, Community Development Financial Institution, discrimination, ethics, EESA, Emergency Economic Stabilization Act, Maxine Waters, minority ownership, OneUnited bank, preferred stock, race, racial discrimination, TARP

JEL Classification: G21, G28, G38, H81, J15

Suggested Citation

Puente, Lucas and Wilson, Linus, Minority Ownership and TARP Investments (May 23, 2013). Available at SSRN: https://ssrn.com/abstract=2247043 or http://dx.doi.org/10.2139/ssrn.2247043

Lucas Puente

Stanford University - Department of Political Science ( email )

Stanford, CA 94305
United States

HOME PAGE: http://www.stanford.edu/~lpuente

Linus Wilson (Contact Author)

University of Louisiana at Lafayette - College of Business Administration ( email )

Department of Economics & Finance
214 Hebrard Blvd., Room 326
Lafayette, LA 70504-0200
United States
(337) 482-6209 (Phone)
(337) 482-6675 (Fax)

HOME PAGE: http://www.linuswilson.com

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