For-profit

Amalgamated Bank of New York (Amalgamated Bank)

Website:

www.amalgamatedbank.com

Type:

Private, Labor Union-Controlled Bank

Formation:

1923 in New York City

Founders:

Sidney Hillman

Hyman Blumberg

R. L. Redheffer

Controlled By:

Service Employees International Union (SEIU)

Workers United (SEIU division)

Previous Controllers:

Unite Here

Amalgamated Clothing Workers of America

Headquarters:

New York City

Offices in Washington, D.C.

President & Chief Executive Officer:

Keith Mestrich

Preceded By:

Gabriel Caprio

This article concerns the labor-union-owned bank headquartered in New York. For the commercial bank headquartered in Chicago, see Amalgamated Bank of Chicago.

Amalgamated Bank of New York (known as Amalgamated Bank) is the nation’s largest labor union-owned bank. Created originally by the Amalgamated Clothing Workers of America (ACWA), since 2010 the bank has been controlled by the Service Employees International Union’s (SEIU) Workers United division. [1] It has over $4 billion in assets and nearly $40 billion under management, largely from union pension funds.[2]

The bank operates as a “a left-of-center, changemaker bank”[3] that uses financial mechanisms to push for liberal corporate policies and provides boutique banking services to labor unions, left-of-center organizations, environmentalist-aligned businesses, and liberal candidates. The bank counts Ready For Hillary (Hillary Clinton’s super PAC) the Democratic National Committee, and hundreds of labor unions and liberal organizations as its clients.[4] The bank offers these liberal clients tailored products that help them to carry out their liberal mission, including a 24-hour concierge for liberal political candidates, and a new product that helps unions automatically collect member fees if state legislatures restrict the union’s ability to mandate this collection.[5]

The bank also uses its considerable financial resources to pursue a left-wing corporate governance agenda. Through activist investing, the bank only invests its in companies that share its liberal social and environmental goals.[6] Amalgamated seeks to force corporate boards to implement left-of-center policies,[7] including environmentalist policies, political spending disclosures, and labor restrictions.[8]

Additionally, the bank uses its internal policies to act as a standard bearer for left-wing corporate policies such as the $15/hour minimum wage[9] and union purchasing preferences.[10]

Organizational History

The Amalgamated Clothing Workers of America (ACWA) founded the Amalgamated Bank in 1923 with $500,000 in resources and 1,300 depositors on opening day.[11] The bank was the brainchild of Sidney Hillman, then-general president of the ACWA union.[12] At its inception the bank’s chairman was Hyman Blumberg, and its president was R.L. Redheffer.[13]The bank was dedicated “to the service and advancement of the labor movement.”[14]

Amalgamated Bank touts that it has actively aided labor union efforts. In 1973, “as a show of support and dedication to the causes of unions,” the bank provided bail checks to keep striking Philadelphia teachers out of jail. In the 1980’s the bank offered “credit to striking workers from Eastern Airlines and NYNEX.”[15]

Amalgamated Bank was the first labor union-owned bank in New York City, and one of the first in the United States. It is currently the largest union-owned bank in America: As of 2014, the bank had $3.7 billion in assets and $37.9 billion worth of trust assets under management.[16]

Amalgamated Bank currently has retail branches across four boroughs of New York City and one in Washington, D.C.[17]

SEIU Ownership Battle

For more on the SEIU/Unite Here dispute of the late 2000s, see Workers United (Labor Union)

In the late 2000s, Amalgamated Bank was at the center of a bitter controversy involving Service Employees International Union (SEIU) president Andy Stern and the leaders of the merged garment, textile, hotel, and restaurant employees union known as Unite Here.[18]

The dispute ended in July 2010 with the SEIU (under Stern’s successor, Mary Kay Henry) stripping control of Amalgamated Bank and its $4 billion worth of assets away from the Unite Here union. [19]

Near Collapse

In the wake of the 2008 financial crisis Amalgamated Bank “nearly collapsed […] after it was forced to write off $150 million in subprime loans.”[20] Amalgamated Bank lost more than $12 million in 2011, and federal regulators demanded management clean up the balance sheet or risk being seized and shut down.[21]

In order to save the bank, two billionaires—Wilbur Ross (later President Donald Trump’s Commerce Secretary[22]) and Ron Burkle—invested a combined $100 million in exchange for a 40% ownership stake in the bank.[23]

Operations

People

Keith Mestrich, is currently CEO and president of Amalgamated Bank. Mestrich previously served for four years as the chief financial officer at the SEIU. He “joined the bank’s Washington office in 2012 and put a special emphasis on expanding the bank’s political business beyond unions.”[24]

Lynne Fox has chaired Amalgamated Bank’s board of directors since May 2016. She also serves as president of the SEIU’s Workers United division.[25]

Amalgamated Bank’s board also includes a number of other high-ranking Workers United officials, a former president of the AARP, and two corporate representatives of Wilbur Ross and Ron Burkle.[26]

Left-Wing Clientele

As “the largest manager of union pension funds in the country,” the bank is “a big player in the progressive movement.”[27]

According to the bank’s CEO, courting liberal candidates and entities has been “wildly successful.”[28]

Included among the bank’s clients are “hundreds”[29] of left-leaning labor unions such as the American Federation of State, County, and Municipal Employees (AFSCME), SEIU, and the United Federation of Teachers (UFT). [30]

Additionally, the organization serves as the main banking institution for Hundreds of liberal political organizations, campaigns, and candidates[31] including, the Democratic National Committee (DNC), the Ready for Hillary super PAC, Organizing for Action (OFA, previously known as “Obama For America”), Progressive Majority PAC, America Votes, the Democratic Governors Association (DGA),[32] the Democratic Senatorial Campaign Committee (DSCC), and Media Matters For America.[33]

Democracy Alliance

Also see Keith Mestrich (Person)

Amalgamated Bank has also served as a relationship conduit between its large dollar liberal clients.

The bank’s president, Keith Mestrich (formerly deputy chief of staff of Workers United and chief financial officer of SEIU), leads the recruitment committee for the Democracy Alliance, “an influential club of liberal donors… which funnels tens of millions of dollars annually into left-leaning political groups.”[34]

The bank also helped the League of Conservation Voters organize a fundraiser for left-wing Senate candidates in 2016. [35]

Activism

Activist Policies

Amalgamated Bank holds itself to be an alternative to commercial banks for liberal individuals and left-wing organizations that don’t want to be clients of traditional banks.[36] It counts the Occupy Wall Street movement among its banking clients.[37]

The bank argues that it “should be [a] forceful advocate for public policy” and uses its financial resources to push for left-of-center policies.[38]

Activist Investing

The bank is a “founding signatory” to the United Nations Principles of Responsible Investment, which encourages the consideration of liberal Environmental and Social impacts for all investment decisions. [39]

According to CEO Keith Mestrich, Amalgamated will not use its money to support gun manufacturers or domestic oil production.[40]

The bank also claims it’s committed to “addressing climate change” by adopting new investment policies and offering low-carbon investment funds.[41]

Shareholder Activism

Amalgamated Bank, through its LongView investment funds, has long used “aggressive shareholder actions”[42] to force its preferred liberal social, environmental, and corporate governance policies upon corporate boards.[43] The bank labels these efforts “Advocacy Through Ownership.”[44]

Since 1997, the bank has used shareholder actions to push for corporate boards to impose internal policies that require full public reporting of any political contributions, including “soft money” donations, trade association contributions, and non-profit contributions.[45]

In 1994, the bank used shareholder actions to push for corporate codes of conduct that include specific labor restrictions.[46]

Since the early 2000s, the bank has used shareholder actions to attack what it considers excessive corporate executive salaries and executive equity compensation. [47]

In 2011, the bank used shareholder actions to urge oil companies to make executive bonuses contingent on the company implementing internal environmental procedures.[48]

According to the New York Times, “Amalgamated has been a lead plaintiff in several of the largest derivative lawsuits in recent years, including a successful $150 million lawsuit against Duke Energy.” [49] The bank also warned Walmart and The Gap that the companies that the companies could face lawsuits and shareholder actions if they did not change their labor practices.[50]

In 2015, the bank pushed for corporate boards to increase their diversity by adding more women; [51] in 2018, Amalgamated expanded its “definition of corporate board diversity to include LGBTQ individuals.”[52]

Internal Policies

The Bank has enacted a number of internal policies that address liberal priorities.

The Bank “strive[s] to purchase only products that have been made by union workers in America” and seeks to only hires union contractors for its construction and printing projects. The bank goes so far as to “fly on unionized airlines and stay at unionized hotels.”[53]

In 2015, Amalgamated was the first bank in the nation to enact a $15 per hour minimum wage, a national priority of its parent, the SEIU.[54]

In December 2016, the bank “took the Obama administration’s Equal Pay Pledge,” promising to try and eliminate the purported gender wage gap.[55]

Left-Wing Products

The bank has crafted a number of products that serve its liberal agenda.

In response to state legislation that eliminates automatic payroll deductions for union dues, Amalgamated Bank devised a new product that allows union organizers to create recurring payments for employees who have opted into the unions’ dues payment scheme and to identify and target those individuals who have not chosen to take part.[56]

The bank offers its political campaign clients “a 24-hour concierge service, staffed by veterans of President Obama’s campaigns.”[57] The bank also offers “solar home equity lines of credit” and “a series of programs designed to support the development and financing of affordable housing.”[58]

Liberal Contributions

In 2016, Amalgamated Bank gave $1.68 million to liberal candidates and causes. Each entity receiving the Bank’s money was required to support unionization, liberal environmental policies, expansive LGBT rights, and unfettered abortion rights.[59]

References

  1. Moberg, David. “UNITE HERE, SEIU Resolve Major Dispute, Agree on Division of Money, Members, Organizing.” In These Times. July 27, 2010. Accessed March 8, 2018. http://inthesetimes.com/working/entry/6266/union_dispute_resolved_unite_here_seiu_agree_on_division_of_money_memb/
  2. Ember, Sydney. “At Union-Owned Amalgamated Bank, New Chief Charts a Progressive Course.” New York Times Dealbook. August 1, 2014. Accessed March 8, 2018. https://dealbook.nytimes.com/2014/08/01/at-union-owned-amalgamated-bank-new-chief-charts-a-progressive-course/
  3. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  4. “Amalgamated Bank: Our Clients.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/our-clients
  5. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  6. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  7. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  8. “Amalgamated Bank corporate governance timeline.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/amalgamated-bank-corporate-governance-timeline
  9. Lewis, Cora. “America’s Most Union-Friendly Bank Raises Minimum Wage To $15 An Hour.” Buzzfeed. August 6, 2015. Accessed March 8, 2018. https://www.buzzfeed.com/coralewis/americas-most-union-friendly-bank-raises-minimum-wage-to-15#.jp4D3Je7N
  10. “A proud history of labor advocacy.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/proud-history-labor-advocacy
  11. Amalgamated Bank Advertisement. The Liberator. Page 2. May 1923. Accessed March 8, 2018. https://www.marxists.org/history/usa/culture/pubs/liberator/1923/05/v6n05-w61-may-1923-liberator.pdf
  12. Amalgamated Bank: Our History. Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/our-history
  13. Amalgamated Bank Advertisement. The Liberator. Page 2. May 1923. Accessed March 8, 2018. https://www.marxists.org/history/usa/culture/pubs/liberator/1923/05/v6n05-w61-may-1923-liberator.pdf
  14. “Amalgamated, First Jewish Labor Bank, Shows Great Progress in Two Years Existence.” Jewish Telegraph Agency. January 25, 1926. Accessed March 8, 2018. https://www.jta.org/1926/01/25/archive/amalgamated-first-jewish-labor-bank-shows-great-progress-in-two-years-existence
  15. Amalgamated Bank: Our History. Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/our-history
  16. Ember, Sydney. “At Union-Owned Amalgamated Bank, New Chief Charts a Progressive Course.” New York Times Dealbook. August 1, 2014. Accessed March 8, 2018. https://dealbook.nytimes.com/2014/08/01/at-union-owned-amalgamated-bank-new-chief-charts-a-progressive-course/
  17. Amalgamated Bank. Confluence Philanthropy Website. Undated. Accessed March 8, 2018. http://www.confluencephilanthropy.org/Amalgamated-Bank
  18. Moberg, David. “UNITE HERE, SEIU Resolve Major Dispute, Agree on Division of Money, Members, Organizing.” In These Times. July 27, 2010. Accessed March 8, 2018. http://inthesetimes.com/working/entry/6266/union_dispute_resolved_unite_here_seiu_agree_on_division_of_money_memb/
  19. Moberg, David. “UNITE HERE, SEIU Resolve Major Dispute, Agree on Division of Money, Members, Organizing.” In These Times. July 27, 2010. Accessed March 8, 2018. http://inthesetimes.com/working/entry/6266/union_dispute_resolved_unite_here_seiu_agree_on_division_of_money_memb/
  20. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  21. Elstein, Aaron. “Amalgamated Bank caught in the Trump crossfire.” Crain’s New York. December 22, 2016. Accessed March 8, 2018. http://www.crainsnewyork.com/article/20161222/FINANCE/161229959/this-union-owned-bank-has-gotten-caught-in-donald-trump-crossfire
  22. Elstein, Aaron. “Amalgamated Bank caught in the Trump crossfire.” Crain’s New York. December 22, 2016. Accessed March 8, 2018. http://www.crainsnewyork.com/article/20161222/FINANCE/161229959/this-union-owned-bank-has-gotten-caught-in-donald-trump-crossfire
  23. Ember, Sydney. “At Union-Owned Amalgamated Bank, New Chief Charts a Progressive Course.” New York Times Dealbook. August 1, 2014. Accessed March 8, 2018. https://dealbook.nytimes.com/2014/08/01/at-union-owned-amalgamated-bank-new-chief-charts-a-progressive-course/
  24. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  25. “Amalgamated Bank: Board of Directors.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/board-directors
  26. “Amalgamated Bank: Board of Directors.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/board-directors
  27. Ember, Sydney. “At Union-Owned Amalgamated Bank, New Chief Charts a Progressive Course.” New York Times Dealbook. August 1, 2014. Accessed March 8, 2018. https://dealbook.nytimes.com/2014/08/01/at-union-owned-amalgamated-bank-new-chief-charts-a-progressive-course/
  28. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  29. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  30. “Amalgamated Bank: Our Clients.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/our-clients
  31. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  32. “Amalgamated Bank: Our Clients.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/our-clients
  33. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  34. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  35. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  36. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  37. Abelson, Max. “How Two Billionaires Rescued a Union Bank.” Bloomberg News. October 10, 2013. Accessed March 8, 2018. https://web.archive.org/web/20170116124859/https://www.bloomberg.com/news/articles/2013-10-10/how-wilbur-ross-and-ron-burkle-rescued-union-owned-amalgamated-bank
  38. “Amalgamated’s Five Principles of Responsible Banking.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/five-principles
  39. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  40. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  41. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  42. Croft, Thomas and Malhorta, Annie. “The Responsible Investor Handbook: Mobilizing Workers’ Capital for a Sustainable World.” Routledge. New York. September 2017. Accessed March 8, 2018. https://books.google.com/books?id=ZKo0DwAAQBAJ&pg=PT122&lpg=PT122&dq=%22amalgamated+bank%22+and+%22shareholder+actions%22&source=bl&ots=Z7CG5TQSAA&sig=kJ_HMw-BwSsYuoOecMBO36uasdE&hl=en&sa=X&ved=0ahUKEwjV55fCzd_ZAhVHnq0KHevHAvoQ6AEIUzAF#v=onepage&q&f=false
  43. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  44. “Amalgamated Bank First in Industry to Redefine Diversity in Leadership.” Amalgamated Bank Website. February 16, 2018. Accessed March 8, 2018. https://www.amalgamatedbank.com/article/2018-02-16/amalgamated-bank-first-industry-redefine-diversity-leadership
  45. “Amalgamated Bank corporate governance timeline.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/amalgamated-bank-corporate-governance-timeline
  46. “Amalgamated Bank corporate governance timeline.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/amalgamated-bank-corporate-governance-timeline
  47. “Amalgamated Bank corporate governance timeline.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/amalgamated-bank-corporate-governance-timeline
  48. “Amalgamated Bank corporate governance timeline.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/amalgamated-bank-corporate-governance-timeline
  49. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  50. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  51. “LongView Funds Corporate governance and proxy voting report Executive summary.” June 30, 2015. Accessed March 8, 2018. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB_LongView_091115_FINAL.PDF
  52. “Amalgamated Bank First in Industry to Redefine Diversity in Leadership.” Amalgamated Bank Website. February 16, 2018. Accessed March 8, 2018. https://www.amalgamatedbank.com/article/2018-02-16/amalgamated-bank-first-industry-redefine-diversity-leadership
  53. “A proud history of labor advocacy.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/proud-history-labor-advocacy
  54. Lewis, Cora. “America’s Most Union-Friendly Bank Raises Minimum Wage To $15 An Hour.” Buzzfeed. August 6, 2015. Accessed March 8, 2018. https://www.buzzfeed.com/coralewis/americas-most-union-friendly-bank-raises-minimum-wage-to-15#.jp4D3Je7N
  55. “What it means to “B” responsible.” Amalgamated Bank Website. Undated. Accessed March 8, 2018. https://www.amalgamatedbank.com/what-it-means-b-responsible
  56. Landy, Heather. “How one of America’s original mission-driven businesses rediscovered its purpose.” Quartz. October 11, 2017. Accessed March 8, 2018. https://work.qz.com/1098025/amalgamated-bank-ceo-keith-mestrich-on-being-a-mission-driven-business/
  57. Confessore, Nicholas. “Owned by Union, Amalgamated Bank Gives Lift to the Left.” New York Times. August 29, 2015. Accessed March 8, 2018. https://www.nytimes.com/2015/08/30/us/politics/owned-by-union-amalgamated-bank-gives-lift-to-the-left.html
  58. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf
  59. “Impact Report.” Amalgamated Bank Website. 2016. Accessed March 8, 2018. https://www.amalgamatedbank.com/sites/default/files/AB428_ImpactReport_FINAL_rev.pdf

Directors, Employees & Supporters

  1. Lynne Fox
    Board Chair
  2. Keith Mestrich
    President & CEO
  3. Andy Stern
    Former SEIU President
  4. Mary Kay Henry
    SEIU President

Donation Recipients

  1. Netroots Nation (Non-profit)
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