America’s only union-owned bank got an infusion of cash last week from two of New York’s most well-known money men. Wilbur L. Ross Jr. and
Ronald W. Burkle bailed out Amalgamated Bank with a deal that gave them 41 percent ownership in the bank.
WL Ross & Co. LLC and the Yucaipa Companies, Burkle’s firm, each invested a reported $50 million. Yucaipa brought in Magic Johnson Enterprises as an investor as well. “Amalgamated is well positioned to meet the needs of speciic segments of the population who are not well served by the major banks,” said Ross in a statement. “The bank will use its stronger capital base to meet this demand.”
“Amalgamated’s long history of union ownership places it in a unique position to serve the inancial needs of America’s labor organizations, the
pension fund community and working people throughout our nation,” added Burkle.
The New York State Banking Department ordered Amalgamated Bank to increase its capital ratio to 7 percent by August. It had fallen down to 6.2
percent, so Amalgamated went to Ross and Burkle for help. The former is a steel and coal industry investor and the latter a supermarket magnate.
Currently, Amalgamated has 25 retail branches in locations such as Washington, D.C., Las Vegas, New Jersey, California and New York.
They have 20 branches in New York alone. “With these investments, Amalgamated Bank’s capital comfortably exceeds the required levels established in our agreements with the New York State Department of Financial Services and the FDIC,” said Amalgamated Bank President and CEO Edward Grebow in a statement.
Back in February, the Federal Reserve approved of Workers United taking
ownership of Amalgamated. Before then, the bank was owned by Unite Here, a union formed by the merger of America’s main apparel workers union and main hotel workers union in 2004.
The merger ended ive years later after a dispute about which union would own the bank.
Noel Beasley, Amalgamated’s chairman and president of Workers United, sees a new era of stability for the bank.
“For almost nine decades, our bank has served the interests and met the Financial needs of organized labor and its members,” Beasley said in a statement. “Now and in the future, union leaders, who make up the majority of our board of directors, will continue to chart the bank’s course.”
Amalgamated currently has $4.5 billion in assets, and is the nation’s largest manager of union pension funds, with their trust department managing or serving as guardian for $31 billion in assets.