Amalgamated Financial Corp. operates as the bank holding company for Amalgamated Bank that provides commercial and retail banking, investment management, and trust and custody services in the United States.
The company is a full-service commercial bank offering a complete suite of commercial and retail banking products, investment management, and trust and custody services, and lending services. The company generates relationship deposits from its values-based commercial clients and consumer cu...
Amalgamated Financial Corp. operates as the bank holding company for Amalgamated Bank that provides commercial and retail banking, investment management, and trust and custody services in the United States.
The company is a full-service commercial bank offering a complete suite of commercial and retail banking products, investment management, and trust and custody services, and lending services. The company generates relationship deposits from its values-based commercial clients and consumer customers. It further develops new and existing relationships through its trust, custody, and investment management services, which generate fee income, and it also offers investment, brokerage, asset management, and insurance products to its retail customers through a third-party broker dealer.
The company focuses on geographic markets with large and growing populations of its target customer base. The company’s primary geographic markets in which it has branch offices include New York City, Washington, D.C., San Francisco, and one commercial office in Boston.
The company’s corporate divisions include Commercial Banking, Trust and Investment Management, and Consumer Banking. Its product line includes residential mortgage loans, commercial and industrial (‘C&I’) loans, commercial real estate (‘CRE’) loans, multifamily loans, consumer loans (predominantly residential solar), and a variety of commercial and consumer deposit products, including non-interest-bearing accounts, interest-bearing demand products, savings accounts, money market accounts, and certificates of deposit. The company also offers online banking and bill payment services, online cash management, safe deposit box rentals, debit card and ATM card services, and the availability of a nationwide network of ATMs for its customers.
The company offers a wide range of trust, custody, and investment management services, including asset safekeeping, corporate actions, income collections, proxy services, account transition, asset transfers, and conversion management. It also offers a broad range of investment products, including both index and actively-managed funds spanning equity, fixed-income, real estate, and alternative investment strategies to meet the needs of its clients. The company’s products and services are tailored to its target customer base that prefers a financial partner that is socially responsible, values-oriented, and committed to creating positive change in the world. These customers include advocacy-based non-profits, social welfare organizations, national labor unions, political organizations, foundations, socially responsible businesses, and other for-profit companies that seek to balance their profit-making activities with activities that benefit their other stakeholders and constituents.
Competition
From a custody standpoint, the company mainly competes against larger custodial institutions, such as State Street and BNY Mellon, US Bank, Regions Bank, and M&T Bank. In investment management, it regularly competes against a host of firms that provide passive equity index replication to their clients, including State Street, BlackRock, and Vanguard. The company’s active products, both in equities and fixed-income, compete against dozens of institutional managers who traditionally provide services to Taft-Hartley funds, public funds, and endowments/foundations.
Business Components
Deposits
The company gathers deposits primarily through teams of bankers organized based on region and client segment. It sources consumer deposits through its branch network, online network, and mobile platform. Through these channels, the company offers a variety of deposit products, including demand deposit accounts, interest-bearing products, savings accounts, and certificates of deposit. The company’s deposit base consists of checking deposits, other liquid deposits, such as money market checking, savings, and passbook deposits, and certificates of deposit, which also include brokered deposits. The vast majority of its commercial deposits are derived from socially responsible organizations.
Trust and Investment Management
The company has been providing institutional trust, custody, and investment management services. This business has become an integral contributor to the company’s franchise and is complementary to its commercial banking business, as they each help support and grow the other. Approximately one-third of its trust and investment management clients utilize its deposit products. The majority of the company’s trust and investment management business consists of institutional investment clients, such as multi-employer pension funds and Taft-Hartley funds.
The company’s custody service bankers have considerable experience with its target customer base, offering a highly personal approach to customer support and customizable solutions, including those that are specifically designed to meet the requirements of the Employee Retirement Income Security Act of 1974 and public sector employee benefit and pension plans, endowments, foundations, and family offices. The company’s core custody services feature a wide-ranging and comprehensive product suite, including asset safekeeping, corporate actions, income collections, proxy services, account transition, asset transfers, and conversion management, which focus on adding value for its clients.
The company’s investment management offerings are currently composed of a broad range of both index and actively-managed funds spanning equity, fixed-income, real estate assets, and alternative investment strategies. The company’s experienced team specifically tailors its investment strategy to align with the values of its clients. It launched its LongView family of funds in 1992 to promote advocacy through ownership, guided by the investment belief that companies with strong corporate governance deliver stockholders greater and less volatile returns over the long term. The company views accountability, prudent risk oversight, social and environmental awareness, and relationships with workers, stockholders, and the community as the key principles for sustainable value creation that define good governance best practices and enhance the prospects for sound stockholder returns. It plays an active role in promoting strong corporate governance through its proxy-voting guidelines, the filing of socially-aligned stockholder proposals, and litigation brought by it on behalf of its investors.
Commercial and Industrial Lending
The company takes a relationship-based approach to its target customer loan origination strategy, as its bankers have developed a deep level of experience with its customers within its target customer base and their unique banking needs. The company’s business strategy involves growing its business by earning the trust of these customers through a demonstrated dedication to its shared values—these mission-aligned customers seek its expertise in order to obtain various forms of specialty lending. The company’s specialty lending includes bridge financing guaranteed by philanthropic grants, financing for owner-occupied union facilities, loans to affordable housing construction funds administered by leading Community Development Financial Institutions Funds, loans for commercial solar deployment and other renewable power and energy efficiency projects, and loans to political campaigns.
Real Estate Loans
The company’s real estate portfolio consists of loans to individuals and commercial businesses, including one-to-four family, multifamily, and CRE.
Residential Real Estate
The company’s portfolio of originated real estate loans to individuals is based primarily in its geographic markets, but also a minority of real estate loans are to individuals outside its geographic markets, some of which are affinity mortgage programs it has developed for members of certain commercial customers, such as the Service Employees International Union and American Federation of Teachers. The company’s residential loans are primarily closed-end mortgage loans, secured by a first lien on one-to-four family dwellings primarily in its geographic footprint. The dwellings are typically residential structures consisting of principal residences, second or vacation homes, and investment properties, with property types including single-family homes, two-to-four unit homes, condominiums, and cooperative apartments. The company also owns portfolios of purchased one-to-four family loans.
Multifamily and CRE
A substantial portion of the company’s portfolio is composed of multifamily loans made to customers in New York, predominantly for rent-stabilized buildings. The company generally applies stringent underwriting guidelines for LTV and debt service coverage ratios, which are intended to mitigate credit and concentration risk in this loan category. The company’s cumulative historical multifamily loss rate from January 1, 2019, through December 31, 2024, is 9 basis points. The average current LTV of its multifamily loans is approximately 54%. The company’s CRE exposure is also predominantly in the New York metropolitan area and includes loans on office buildings, owner-occupied office buildings, retail centers, industrial facilities, mixed-use buildings, and education centers, with an average current LTV of 42%.
Securities
The company’s securities portfolio primarily consists of high-quality investments in mortgage-backed securities to government-sponsored entities, other asset-backed securities, and Property Assessed Clean Energy (‘PACE’) investments. All non-agency securities, composed of non-agency commercial mortgage-backed securities, collateralized loan obligations, non-agency mortgage-backed securities, and asset-backed securities, are senior tranche. The company’s securities portfolio includes Federal Home Loan Bank of New York (‘FHLBNY’) stock.
Business Strategy
The company’s differentiated model of providing relationship-based, personalized service and customized solutions while sharing its customers’ values has driven the growth of its commercial banking, trust and investment management, and contributes to its consumer banking businesses.
The company expects to further enhance its franchise value by continuing to develop organic relationships with its target customer base in existing markets, expanding strategically into new geographies. Commitment to the company’s customers’ values is a central tenet of its differentiated business model, and it expects it to continue to serve as the pillar of its broader business strategy. The company’s key strategies are to focus on deposit-led organic growth, geographic expansion, and foster strong client relationships and unparalleled understanding of its clients’ goals and objectives.
Supervision and Regulation
The company is a bank holding company registered with the Board of Governors of the Federal Reserve under the Bank Holding Company Act of 1956, as amended. On March 1, 2021 (the ‘Effective Date’).
The company owns 100% of the outstanding capital stock of the bank and is considered to be a bank holding company registered under the federal Bank Holding Company Act of 1956 (the ‘BHC Act’). As a result, it is primarily subject to the supervision, examination, and reporting requirements of the Federal Reserve under the BHC Act and its regulations promulgated thereunder. The Federal Reserve imposes certain capital requirements on bank holding companies under the BHC Act, including a minimum leverage ratio and a minimum ratio of ‘qualifying’ capital to risk-weighted assets. These requirements are essentially the same as those that apply to the bank. As a Delaware public benefit corporation, the company is subject to the limitations of the Delaware General Corporation Law (‘DGCL’). The company is a legal entity separate and distinct from the bank and its other subsidiaries. Various legal limitations restrict the bank from lending or otherwise supplying funds to the company or its non-bank subsidiaries. The company and the bank are subject to Sections 23A and 23B of the Federal Reserve Act and Federal Reserve Regulation W. As a New York state-chartered bank with FDIC-insured deposits, it is examined, supervised, and regulated by the NYDFS, the company’s primary regulator, and the FDIC, its primary federal regulator. The NYDFS is charged with its supervision and regulation. The company’s deposits are insured by the FDIC to the fullest extent permissible by law. As an insured depository institution, it is required to comply with the capital requirements promulgated under the FDIA.
The company is subject to certain requirements and reporting obligations under the Community Reinvestment Act (‘CRA’). It is also subject to analogous state CRA requirements in New York and other states. The company received a ‘satisfactory’ CRA Assessment Rating from both regulatory agencies in its most recent examinations. The company is subject to certain fair lending requirements and reporting obligations involving lending operations. A number of laws and regulations provide these fair lending requirements and reporting obligations, including, at the federal level, the Equal Credit Opportunity Act (‘ECOA’), as amended by the Dodd-Frank Act, and Regulation B, as well as the Fair Housing Act (‘FHA’) and regulations implementing FHA found at 24 C.F.R. Part 100. The company’s activities are subject to a variety of statutes and regulations—both at the federal and state levels—designed to protect consumers. This includes Title X of the Dodd-Frank Act, which prohibits engaging in any unfair, deceptive, or abusive acts or practices (‘UDAAP’).
The company’s loan operations are also subject to federal laws applicable to credit transactions, such as:
The Truth-In-Lending Act (‘TILA’) and Regulation Z, governing disclosures of credit and servicing terms to consumer borrowers and including substantial new requirements for mortgage lending and servicing, as mandated by the Dodd-Frank Act;
The Home Mortgage Disclosure Act of 1975 and Regulation C, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the communities it serves, and requiring collection and disclosure of data about applicant and borrower characteristics to assist in identifying possible discriminatory lending patterns and enforcing anti-discrimination statutes;
The ECOA and Regulation B, prohibiting discrimination on the basis of race, color, religion, or other prohibited factors in any aspect of a credit transaction;
The Fair Credit Reporting Act of 1978, as amended by the Fair and Accurate Credit Transactions Act and Regulation V, as well as the rules and regulations of the FDIC governing the use of consumer reports and provision of information to credit reporting agencies, certain identity theft protections, and certain credit and other disclosures;
The Fair Debt Collection Practices Act and Regulation F, governing the manner in which consumer debts may be collected by collection agencies and intending to eliminate abusive, deceptive, and unfair debt collection practices;
The Real Estate Settlement Procedures Act (‘RESPA’) and Regulation X, which governs aspects of residential mortgage loans, including the settlement and servicing process, dictates certain disclosures to be provided to consumers, and imposes other requirements related to compensation of service providers, insurance escrow accounts, and loss mitigation procedures;
The Secure and Fair Enforcement for Mortgage Licensing Act (‘SAFE Act’), which mandates a nationwide licensing and registration system for residential mortgage loan originators. The SAFE Act also prohibits individuals from engaging in the business of a residential mortgage loan originator without first obtaining and maintaining annually registration as either a federal or state licensed mortgage loan originator;
The Homeowners Protection Act (‘HPA’), or the PMI Cancellation Act, provides requirements relating to private mortgage insurance (PMI) on residential mortgages, including the cancellation and termination of PMI, disclosure and notification requirements, and the requirement to return unearned premiums;
The FHA prohibits discrimination in all aspects of residential real estate-related transactions based on race or color, national origin, religion, sex, and other prohibited factors;
The Servicemembers Civil Relief Act (‘SCRA’) and Military Lending Act (‘MLA’), providing certain protections for servicemembers, members of the military, and their respective spouses, dependents, and others; and
Section 106(c)(5) of the Housing and Urban Development Act requires making home ownership available to eligible homeowners.
The company’s deposit operations are also subject to federal laws, such as:
The FDIA, which, among other things, imposes a minimum amount of deposit insurance available per account to $250,000 and imposes other limits on deposit-taking;
The Right to Financial Privacy Act, which imposes a duty to maintain the confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records;
The Electronic Funds Transfer Act and Regulation E, which governs the rights, liabilities, and responsibilities of consumers and financial institutions using electronic fund transfer services, and which generally mandates disclosure requirements, establishes limitations on liability applicable to consumers for unauthorized electronic fund transfers, dictates certain error resolution processes, and applies other requirements relating to automatic deposits to and withdrawals from deposit accounts;
The Expedited Funds Availability Act (‘EFA Act’) and Regulation CC, setting forth requirements to make funds deposited into transaction accounts available according to specified time schedules, disclose funds availability policies to customers, and relating to the collection and return of checks and electronic checks, including the rules regarding the creation or receipt of substitute checks; and
The Truth in Savings Act (‘TISA’) and Regulation DD, which requires depository institutions to provide disclosures so that consumers can make meaningful comparisons about depository institutions and accounts.
In addition, the company is subject to increased regulations concerning consumer privacy, including but not limited to the California Consumer Privacy Act (‘CCPA’) with respect to certain data regarding California residents and the NYDFS Cybersecurity Regulations, as amended by NYDFS in November 2023.
The company is also subject to regulation under the fiduciary laws of the Employee Retirement Income Security Act of 1974 (‘ERISA’), and to regulations promulgated thereunder, insofar as it is a ‘fiduciary’ or service provider under ERISA with respect to certain of its clients.
As an FDIC-insured bank, the company must pay deposit insurance assessments to the FDIC based on its average total assets minus its average tangible equity. As an institution with less than $10 billion in assets, its assessment rates are based on the level of risk it poses to the FDIC’s deposit insurance fund (DIF).
History
Amalgamated Financial Corp., a Delaware corporation, was founded in 1923. The company was incorporated in 2020.
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