Wells Fargo and T.D. Jakes Group announced a 10-year partnership aimed at “revitalizing neighborhoods” and creating long-term change in communities most in need.
The announcement comes a year after Bloomberg reported that only 47% of Black homeowners who completed a refinance application with Wells Fargo in 2020 were approved, compared with 72% of white homeowners.
The partnership with T.D. Jakes, a prominent Black minister who leads a Dallas-based megachurch, will focus on initiatives including affordable housing, small business development and financial education.
Over the next 10 years, the partnership could result in “up to $1 billion” in capital and financing from Wells Fargo and grants from the Wells Fargo Foundation, the companies said.
“This alliance with our organization allows us to further our four decades-long work to provide economic justice, eradicate food deserts, construct desirable workplaces and affordable housing, closing the digital divide and ultimately help families leave a rich and lasting legacy for the next generation,” T.D. Jakes said in a statement.
In its first project, Wells Fargo plans to support the revitalization of the nearly 100 acres of Fort McPherson, the historic former army base in Atlanta, Georgia.
“This strategic partnership goes beyond a one-off capital investment and underscores our continued commitment to diverse and inclusive communities,” Charlie Scharf, CEO of Wells Fargo, said in a statement.
T.D. Jakes Real Estate Ventures began purchasing the site in 2022 to create commercial and residential spaces. The plans include mixed-income housing in the form of single-family homes, townhomes, and apartments.
The partnership represents Wells Fargo’s largest minority home lending and development initiative to date. It also follows several scandals related to its lending practices.
In December, the bank agreed to pay $1.7 billion to settle multiple consent orders related to automobile lending, consumer deposit accounts and mortgage lending with the Consumer Financial Protection Bureau (CFPB).
The bank repeatedly misapplied loan payments, wrongfully foreclosed on homes, illegally repossessed vehicles and charged surprise overdraft fees, affecting 16 million customers’ accounts, according to the CFPB. Consequently, the regulator ordered the bank to pay more than $2 billion in redress to consumers.
Bank executives at the time hinted that they would be shrinking Wells Fargo’s mortgage footprint and exiting the correspondent channel, where it was the largest lender and bought billions of dollars in government agency loans, an engine of homeownership for minority communities.
In January, the bank said it would continue to be the primary mortgage leader to Wells Fargo customers and minority homebuyers through its mortgage retail team. Wells Fargo also announced plans to invest an additional $100 million to advance racial equity through its $210 million special purpose credit program, which came in the wake of the Bloomberg report in March 2022.