FAQs

Right now, public dollars are flowing out of our communities and into the hands of big banks and billionaire shareholders. This reduces money available for local, community-wide needs like affordable workforce housing, small business development, and clean energy infrastructure. A public bank offers a different path towards local economic resilience and investment. 

These FAQs explain what that means and how it could work here in the East Bay.

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  • A public bank is a bank owned by the public, like a school, or a fire department. It is a powerful tool to ensure that our public dollars are invested in projects that meet our community’s needs. 

    Imagine if we, the people, controlled where that public money could be invested. We could reinvest our tax dollars and profits into our communities to build sorely-needed infrastructure, small business development, renewable energy, and affordable housing projects.

    Longer Answer:

    Right now, cities deposit public money, like tax revenue, into large private banks. These big banks invest our money into distant projects that do not benefit the public and often do not reflect local community values. To grow their profits, they make investments in fossil fuel companies, private prisons, weapons manufacturers, and other forces that work against livable communities. Big banks are legally mandated to prioritize profits for their shareholders.   

    A public bank flips that model. 

    It is owned by, and accountable to, the public. Instead of extracting wealth. Unlike big commercial banks, most public banks (and all California public banks, under state law, will be nonprofits. They will use their earnings from loan interest and fees to reinvest in local economies and large-scale community-wide projects and return profits to local cities and other public shareholders. The interest and fees they charge will generally be lower than a borrower would get at a commercial bank, resulting in a growing and sustainable cycle of lending that helps local communities thrive.

    Public banks don’t replace local mission-driven lenders, they strengthen them. Public bank profits will be reinvested back into the community, creating a growing pool of money available for even more projects. By working together, we will increase investments in historically ignored and underserved communities.

    The most well-known public bank in the United States is the Bank of North Dakota, which has successfully supported the state’s local economies for more than 100 years. This bank protected North Dakota from the 2008 downturn, distributed federal; pandemic loans effectively, and insulated state residents against the 2025 government shutdown.

    A public bank is not just a financial institution. It’s a building block of public infrastructure, one that allows us to align our values with how money flows in our region.

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  • Friends of Public Bank East Bay is an advocacy effort led by East Bay volunteers to establish a publicly owned bank–Public Bank East Bay. The Friends is a 501(c)(3) organization and all donations are tax deductible.

    Once established, PBEB will partner with local financial institutions like community banks, credit unions and community development financial institutions (CDFIs). These partnerships will help bring needed capital to community projects.

    The function of the bank will be to help keep public dollars circulating locally, bringing additional money and quality of life improvements to the East Bay.. 

    Learn more:

  • The systems that are supposed to support our communities are increasingly unstable, extractive, and out of alignment with what people actually need.

    We are facing overlapping crises–including housing affordability, climate resilience, small business survival, and deep racial wealth gaps–that require long-term, community-centered investment. Instead of addressing these urgent issues, public dollars from East Bay cities and counties are currently held in big banks, where they’re used to generate profits for private shareholders, often in industries that threaten and harm our ability to thrive. 

    With a public bank, the East Bay can take control of our own resources and put them to work here. We can help ensure that public money serves a public purpose.

    By partnering with local community banks, credit unions, and other mission-driven lenders, a public bank can expand access to capital for affordable housing, small businesses, and clean energy projects. 

    This moment makes the need more urgent. Federal uncertainty, budget cuts, and economic volatility are putting pressure on local governments and community institutions. We need tools that increase local resilience and reduce our dependence on the federal government, the big banks, and the ultra-rich.

    Learn more:

  • PBEB will be managed by professionals experienced in banking and community finance, independent of the member counties and cities.

    It will have a strong democratic and multi-stakeholder governance structure, including a Board of Directors with representation from banking and finance, local governments which have contributed capital to the bank, and community leaders. 

    This structure ensures that community voices are at the governing table representing community needs. 

    The mission, operations, and decision-making of PBEB will ensure financial viability and sustainability while prioritizing community wellbeing above maximizing profit. 

    Like any other bank, PBEB will still need to meet strict safety, soundness, and regulatory standards, and will be run by professional bankers that understand the mission and community. 

    A public bank puts our community’s money where it’s needed and takes it out of the hands of billionaire shareholders, fossil fuel, weapons manufacturers, and other things we never voted to support.

  • A public bank is a publicly owned nonprofit corporation which is mission-driven and dedicated to lending locally to community-wide projects, while commercial banks are privately owned and profit-driven.

    Longer answer:
    Commercial banks are legally required to maximize shareholder returns. This means that when cities park our tax dollars there, our tax dollars go to risky, harmful, and speculative investments outside of our community rather than helping us. 

    A public bank will be owned by a public entity and operate with a public mandate. It will use our tax dollars and invest them into what our community needs: affordable housing, small business development, better infrastructure, and renewable energy. 

    Like any other bank, PBEB will still need to meet strict safety, soundness, and regulatory standards, and will be run by professional bankers. A public bank puts our community’s money where it’s needed and takes it out of the hands of  billionaire shareholders, weapons manufacturers, fossil fuel investments, and other things we never voted to support.

     Learn more:

  • Public banks are designed to be impactful, transparent, and accountable. Public banks operate under strict banking regulations, just like private banks. They are required to follow safety and soundness standards, maintain reserves, and minimize risk carefully by making careful, well-evaluated high-impact lending decisions. 

    What makes public banks different is their approach to profit-making. Because they are not driven by shareholder profit, they can focus on steady, long-term investments that strengthen local economies rather than chasing higher-risk, short-term returns. We see this in the Bank of North Dakota’s extraordinary success in 2008, because it had no exposure to subprime mortgages that ignited the Great Recession.

    Public banks also increase safety through partnership. They offer partnership capital for lending alongside community banks, credit unions, and CDFIs. This helps opportunities move forward and strengthens the overall local financial ecosystem.  

    Finally, public banks are accountable to the public. Their decisions are guided by transparency, public oversight, and a clear mission to serve community needs. That accountability helps ensure that public money is managed responsibly and in alignment with the public good.

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  • Small businesses are key to supporting the local economy by building community resilience and wealth. 

    Through partnerships with community lenders, a public bank can help fill critical financing gaps for worker-owned businesses, equipment modernization, infrastructure improvement, etc. 

    For example, a family-owned grocery store in your neighborhood wants to expand and upgrade equipment. A local credit union is willing to lend but must limit exposure due to liquidity constraints. A public bank could purchase a participation share of the loan, enabling the credit union to lend more while keeping the relationship with the business owner.

    Examples of small businesses that are particularly suitable to public bank support include: 

    • Day care centers, which are often in rental properties and have little or no access to home improvement loans.

    • Food trucks, that often don’t meet commercial banks’ standard lending criteria, despite them being a vital part of the local economy and a foothold for many small businesses owners.

    • Businesses in neighborhoods often ignored by traditional lenders, even if the business itself is strong and is improving the neighborhood.

    Longer answer:
    Small businesses often face challenges accessing affordable capital, especially during economic downturns. A public bank could provide participation loans, loan guarantees, or liquidity support to local banks and credit unions, enabling them to lend more confidently to small businesses.

    In addition, public banks are well positioned to support and encourage their partners to support alternative models such as worker-owned coops and land trusts, which most commercial banks tend to shy away from because they don’t fit traditional risk modeling. Models that lock so many people out of opportunities that can improve our neighborhoods.

    Finally, due to its public mandate, a public bank can work with residents, community lenders, and elected leaders to supercharge economic development initiatives, meaning streets with restaurants, small shops, businesses,nonprofits, and health services by and for our community.

    Learn more:

  • A public bank can expand funding for affordable housing by partnering with local lenders to make more loans possible, faster, and at lower cost.

    For example, a nonprofit affordable housing developer in the East Bay secures land for a multi-unit affordable housing project that helps to keep teachers, families, and service workers in the community. A local community bank agrees to originate the construction loan but needs additional capital to move forward. A public bank could participate in the loan or provide credit enhancement, allowing the project to move forward while the community bank remains the primary lender and underwriter.

    PBEB funds can also be used to support other funding sources for creating and preserving affordable housing including grants and subsidies. 

    Longer answer:
    One of the biggest barriers to building and preserving affordable housing is access to reliable, low-cost financing. A public bank can help fill that gap by working with community banks, credit unions, and mission-driven lenders to increase the flow of capital into housing projects that serve low- and moderate-income residents.

    Public banks can support affordable housing in several ways. 

    They can “fast track” funding needed by land trusts, so that they don’t lose out on property to speculators. They can provide credit enhancements, which reduces risk and helps lenders approve more projects. They can offer low-interest or flexible financing that makes it easier to build and preserve housing that would not otherwise pencil out. They can also help stabilize funding over time, so projects are less vulnerable to market swings or sudden funding gaps.

    For Public Bank East Bay, this means keeping public dollars working locally to address the housing crisis, supporting deeply affordable housing, preventing displacement, and strengthening communities.

    Instead of public money sitting in large private banks, public dollars can be used as a tool to directly support housing solutions that reflect community needs and priorities.

    Learn more:

  • A public bank can help fund clean energy and climate projects by making financing more accessible, affordable, and aligned with long-term community benefits. 

    Clean energy projects often require significant investment up front, even when they can save money and deliver public benefits for years to come. Community solar, building electrification, energy-efficiency upgrades, EV charging, battery storage, microgrids, and climate-resilient infrastructure can all face financing barriers. Big banks often think these loans are too small, too new, or too slow to maximize profits for their shareholders.. 

    PBEB can fill the financing gaps by working with other lenders and mission-aligned partners to provide flexible financing, leverage credit enhancement, and participate in larger loans. This helps to make more capital available for projects that are essential to reducing emissions, lowering energy costs, and strengthening local resilience.

    Longer answer:

    The goal is not for PBEB to become a green bank or to finance every project itself. Instead, PBEB can become part of a larger financing ecosystem that is bringing together public funds, private capital, tax incentives, and other resources so promising projects can move forward. 

    This can include everything from solar and energy upgrades for homes and small businesses to community solar, microgrids, battery storage, EV infrastructure, and green infrastructure such as trees, bioswales, and stormwater systems.   

    This approach also creates an opportunity to think beyond individual projects. OakTREE, for example, is developing interconnected neighborhood-scale systems that combine energy infrastructure with other community needs and can grow over time. PBEB can help make these kinds of locally rooted, scalable infrastructure more financially possible.

    For PBEB, the larger goal is to help keep public investment working locally by reducing energy costs, increasing resilience, supporting local jobs and businesses, and ensuring that communities that have historically received less investment can participate in a clean-energy transition.

    Learn more:

  • Stay informed, attend events, and join our planning meetings and work sessions.

    Friends of Public Bank East Bay is a volunteer driven effort and your voice, skills, and experience are welcomed.

Interested in Volunteering?

Fill out the form and we will be in touch!

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