print pageBusiness Plan For The First Common Good Bank™
| Executive Summary: | [PDF] | ||
| Social Impact: | [PDF] | ||
| Business Plan: | [PDF] | ||
| Financial Appendices: | [PDF] | [XLS] | |
NOTE: The common good bank design has evolved as a system of four new organizations collaborating with local businesses and community organizations. The BANK proper is just one of those four components and this business plan is for that component only. This business plan constitutes the core of our charter application. For an overview of the other components, see the Philosophy & Design section.
Common good banks are designed to be the cornerposts of a new economic system -- a democratic, community-based system that can spread quickly to give everyone a home, healthy food, and satisfying work. This is not just another bank with a social mission. This is
a social mission with a bank!
- All profits go to schools and other nonprofits.
- Depositors decide what the bank should invest in.
- Free local credit card processing for local businesses.
- Micro-loans for new businesses and community projects.
- A full range of secure, FDIC-insured banking services.
- Committed to sustainability and economic justice.
Once the first common good bank opens, any community ANYWHERE can start one in just a few days, with no need for a bank building. (How?)
We plan to open with 3,300 founding members, making it possible to open Community Divisions ANYWHERE, almost immediately. Help make it happen with a no-obligation 10-second signup!
How Is This Business Plan Different
Most banks are started by a small group of investors who come up with the required several million dollars in capital. Then, when the bank is successful, those investors get all the profits.
Each common good bank Community Division will be started by its depositors, a group of several dozen small investors buying any amount of stock, from $1 to $100,000, averaging about $1,500. These depositors/investors can expect a modest return on their investment (a planned appreciation rate equal to the true rate of inflation, which has averaged about 6% over the past 30 years). The bank's profits then go to the community. (NOTE: This is not a stock offering. The first common good bank does not yet exist and cannot yet offer stock publicly.)
Common good banks will succeed precisely because of their dedication to the common good. The common good bank™ business plan is by philosophy a work in progress, here for all to see. So far, well over a hundred of us are working together on this project, for the good of all. We welcome your comments and suggestions.
2 Comments
Gerald, thank you.
Costs will for the most part be similar to other banks, except that top salaries will be lower than average, bottom salaries will be higher than average, and we won’t be spending a lot on fancy offices. See the business plan for details.
Return on investment, on resale, is limited to the (true) rate of inflation — no dividends. See the sound investment page for details.
Since common good banks are a community-based system, the bank itself does not grow — it just has more and more participating communities. If a community division gets too large for effective discussions, then it will be split into two or more divisions. And no, growth is not necessary for the bank’s success.
Expenses and revenue are both projected very conservatively. We hope that the bank can do better, but we don’t want to promise more than we can be sure of delivering.
As a local depositor/investor, you get to decide (along with your neighbors) what the nature of the loans will be in your community. It’s up to you.
I see and support the ideas of the bank.
How is the bank different from any other bank in terms of costs, salaries, return on investment… and what keeps the bank from getting too large. Does it have to keep growing to stay viable?
Also not clear why exepenses track so closely to gross revenue… I would think economies of scale would be damatic in a community based system…
As a local depositor, or investor, i would want to know the nature of the loans being made in my community.
Good luck!