With 2021 now firmly in the books for all banks and credit unions we’ve started the process of reviewing performance over the final months of the year in addition to the full year. While this process is ongoing, one of the findings so far is the relative performance of Minority Depository Institutions (MDIs) in 2021. As a quick refresher, MDIs are FDIC-insured commercial banks and savings associations that are either majority owned by minority individuals or have individuals who are minorities representing a majority of their board of directors, in addition to serving communities that are predominantly minority. As of the end of 2021 there were 143 MDIs operating in the United States. These were our headline findings on MDI performance in 2021:

  • Median and average asset growth was 12% and 19%, respectively in 2021
  • Median and average net loan growth was 5.5% and 9.5%, respectively in 2021
  • Median and average total deposit growth was 16% and 24%, respectively in 2021
  • In addition to this the median and average return on assets was 1.2% while the median and average return on equity was 11%
  • Importantly, 83% of MDIs showed an improvement in their return on assets and 65% showed an improvement in their return on equity in 2021
  • MDIs operating in the states of Georgia, Oklahoma and Texas substantially outperformed MDIs operating in other states on average in terms of their return on assets and return on equity
  • Finally, MDIs operating in the same three states (Georgia, Oklahoma and Texas) substantially outperformed the average bank operating in the same states in 2021

MDI Performance in 2021


Displayed above is a summary of the average and median performance of the 143 minority depository institutions that were operating as of the end of 2021. While the asset metrics are impressive, MDIs actually lagged the average bank in the United States in terms of assets, net loans and deposit growth in 2021. Given the fact that MDIs clearly aren’t representative of the United States geography (as we’ve previously discussed, there are a lot of states with no operating MDI and many states with just one MDI), the more accurate way to look at this data is on a state by state basis, which is what we’ve done. On this basis the picture is mixed. For instance, in California MDIs operating in the state lagged the average bank’s asset and deposit growth by 6.6% and 7.7% respectively while their loan growth was 1% better than the average bank in California. On the contrary in Texas, MDIs operating within the state on average had growth that exceeded the average bank in Texas on all three metrics. We see a similar story when it comes to the return metrics of the banks.

MDI Return Performance in 2021 relative to the Average Bank

This is where it gets interesting – as noted earlier we think it makes a lot more sense to evaluate MDIs on a state by state basis given their low representation across the country. We looked at the six states (California, Florida, Georgia, New York, Oklahoma and Texas) that had the most operating MDIs at year end which also represented 69% of all MDIs operating, for the purpose of this analysis.


Starting with the average ROAs: as shown in the chart, in all but California, MDIs reported a higher return on asset than the average bank in the states of Florida, Georgia, New York, Oklahoma and Texas. The margins were most substantial in Georgia, Oklahoma and Texas. Return on Asset is one of the purest measures of performance given that it doesn’t account for balance sheet leverage which can favor banks that are more heavily geared.


Regardless, it is always important to look at the returns banks are generating for their owners. At the end of the day these are (in the vast majority of cases) profit-seeking entities. On this measure, in half of the cases (Georgia, Oklahoma, Texas) presented the average MDI reported returns superior to the average bank in the respective state. This raises the question about the overall capitalization of the average MDI in Florida and New York given the higher ROA.


Finally – this chart is by far the most interesting of our findings. It is admittedly messy so our apologies for that. What it shows is the year on year change in return metrics for the average MDI and the average bank in the respective state. The conclusion is that MDIs on average in all six states showed greater improvement in 2021 in their return on assets than the average bank in the respective states. In fact, the average MDI in these states improved their ROA by 0.5% more than the average bank in the state. The picture is less rosy for return on equity but even still in four of the six states MDIs improved more than the average bank in the respective state.

Notable Banks Among 2021 MDI Performers

Before concluding there were 5 banks out of the operating MDIs that delivered impressive improvements in their return metrics from already competitive levels:

  • First Security Bank and Trust
  • CBW Bank
  • First State Bank
  • Texas National Bank
  • Wallis Bank

Conclusion & Closing Thoughts

It is worth shining a spotlight on these institutions given the fact that their very existence is predicated on serving a critical societal need. With that in mind the fact that many of these banks are delivering performance metrics that outpace the average bank is quite noteworthy. It is rare to see institutions improving their local communities while also excelling operationally. There are only 143 minority depository institutions operating in the United States (compared with more than 4,800 total banks) and there are still 21 states that don’t have a single operating MDI. Should there be more MDIs?