(Bloomberg) -- Treasury Secretary Steven Mnuchin has told large U.S. banks including Goldman Sachs Group Inc (NYSE:GS). and American Express Co (NYSE:AXP). they should do more to help black- and women-owned community banks win federal contracts.
Mnuchin in a letter this week asked some of the country’s biggest banks to participate in the Financial Agent Mentor-Protege Program, in which large lenders counsel their smaller rivals -- those with assets of less than $2 billion -- on how to become financial agents for the Treasury Department.
“Our goal is to expand networks within the financial-services industry and to facilitate the inclusion of a broader range of financial institutions in Treasury business opportunities,” Mnuchin said in a letter to banks seen by Bloomberg. “The collective network of America’s banks, large and small, is a national strength that is critical to our functioning economy.”
Treasury’s office of minority women and inclusion is leading the effort, a team that Mnuchin, who previously led a community bank, has said he meets with once a month. An administration official verified the letter.
Citigroup Inc (NYSE:C). was the first financial-agent bank to participate and worked closely with the Treasury Department to develop the program, according to a case study published by the lender. For the past decade, the New York-based company has managed the Treasury’s OTCnet application, which helps federal agencies accept payments. When it re-bid for the work, the firm included Industrial Bank, a black-owned firm in Washington.
“We hope this program serves as a template and look forward to its continued expansion,” Harold Butler, Citigroup’s head of Treasury and Federal Reserve banking services, said in an emailed statement.
In April, JPMorgan Chase (NYSE:JPM) & Co. announced that it was working with Harbor Bank of Maryland and Liberty Bank and Trust Co., two regional black-owned companies, as part of the Treasury program.
A representative from Treasury declined to comment, and officials at Goldman Sachs and American Express said they had no immediate comment.
(Updates with JPMorgan in penultimate paragraph.)