Schomburg Center for Research in Black Culture, General Research and Reference Division

John Taitt, Souvenir of Negro Progress: Chicago, 1779-1925 (Chicago: De Saible Assoc., 1925)

Black-owned banks filled a desperate need, especially for homebuyers and businesspeople who could not get loans from white banks. Loan sharks could charge interest rates of as much as 30 to 40 percent. Black-owned banks were plagued, however, with poor capitalization, too many long-term speculative real-estate loans, too few short-term loans, and too low a ratio of funds-on-hand to deposits. Jesse Binga (1865-1950) founded a bank in 1908, which developed with the influx of migrants. It was incorporated as a state bank in 1921.