Treasury Department Officials Are Working to Diversify Bank Partnerships
Corvelli McDaniel and Lorraine Cole won the Partnership for Public Service’s ‘People’s Choice’ award for their efforts on the project.
The Treasury Department’s Corvelli McDaniel and Lorraine Cole have been serving in the federal government for a collective 37 years and now they are working together to diversify the department’s partnerships.
Treasury is statutorily allowed to designate financial institutions as financial agents to provide essential services such as collecting federal tax revenue and making payments to Social Security and Veterans Affairs beneficiaries. McDaniel, assistant commissioner of revenue collections management at the Bureau of Fiscal Service, and Cole, chief diversity and inclusion officer, started Treasury’s Bank Mentor Protégé Program in 2018 to expand the scope of these partnerships to include more small, minority-owned and women-owned banks.
“Protégé banks gain a new business partner in the mentor (one with considerable success in the industry), and in an industry where change is so rapid and the delivery of banking services evolving,” said McDaniel.
“Each of the mentor-protégé banks determine their own unique goals and parameters for the relationship, which will vary depending on the capacity and expertise of the respective banks,” said Cole.
As a result of their efforts, Cole and McDaniel are the winners of the nonprofit Partnership for Public Service's 2020 Service to America Medals People’s Choice Award, which is part of its annual Samuel J. Heyman Service to America Medals (known as the Sammies) for outstanding achievements of federal employees.
“We live in a world today with so many challenges and our federal government is central to addressing many, many of them,” said Max Stier, PPS president and CEO. “Our federal government is made up of extraordinary people who don't often get the limelight when they really deserve it. It's with real great pleasure to be able to recognize Corvelli and Lorraine for the exceptional work that they are doing and hopefully offer them up as models not only for public servants to emulate, but also for particularly young people looking for a way to make a big difference.”
Government Executive interviewed McDaniel and Cole earlier this week about their careers in government, the program that led to their winning of this award and their advice for future public servants. The interview has been edited lightly for length and clarity.
GE: Why did you decide to join the federal government?
Cole: I've been doing public service my entire career. I have had about 20 years experience leading not for profit organizations, which I very much consider public service. I've been at Treasury, which is my first and only federal position, [for] almost 10 years. Congressman John Lewis in his final message said that, “Democracy is not a state. It's an act” and no matter what job title I've had, whether it's been in the private sector or public sector, I've always considered myself an activist. So my entry into federal government has just really been an extension of a career that I consider public service.
McDaniel: My time as a public servant does go back a ways now starting when I was in the military as an Army officer, serving primarily overseas. This element of service just resonates with me. It’s something great about giving back about helping others, seeing communities get better and get stronger and…[is] something that is meaningful to me, fulfilling to me. I’ve been at the Treasury Department [for over 27 years] in various roles, but I always had in the back of my mind: ‘You are serving here. You're not only a public servant and a representation of as far as the citizens go, making their government work, this government that they are part of, you’re a representative.’ [It] has been deeply satisfying to play a part in making government more efficient, more effective [and] really making it advance forward [by] modernizing and transforming it, making it relevant, real and appropriate for the times that we're living in.
GE: Can you talk about the program you started and its origins?
McDaniel: It was a reality that Treasury's current network of commercial bank partnerships had become limited to a small number of big banks and it isn't wise for any organization to put all of their eggs in a limited basket. We asked ourselves the question, do we have dynamic enough alliances, partnerships, coalitions to meet the challenges on the horizon? How inclusive and diverse are our business relationships?
We looked at and focused on the talents and abilities of small banks, minority owned, women owned banks. And so the objective, though the mentor protégé program, we wanted to achieve a new end state: a more dynamic network of banks, large banks that could play an important role with their capacity to perform more complex services and small banks [that could] give us the ability to be more agile, nimble, so we can pivot quickly and respond rapidly to immediate needs.
Cole: I came to the whole collaboration from a somewhat different perspective. I'm the chief diversity officer for the Treasury headquarters. And I head the Office of Minority and Women Inclusion...and part of the mandate of this office is to ensure a fair inclusion of minority and women owned businesses in all business activities of the agency.
Treasury does very well in terms of contracting and ensuring minority and women-owned businesses are participating as contractors and providing goods and services. But the bigger challenge was involving minority businesses or financial entities within the financial agent activities that Corvelli and others within the Bureau of Fiscal Services oversee. So my office and Corvelli’s office had dialogue very early on about ways to fulfill this mandate and this was a perfect marriage with the needs that Corvelli just articulated that Treasury had to diversify its financial agents.
GE: What is the importance of this program and what are your future goals?
Cole: There are 5,400 financial institutions in the United States, but only 148 minority owned banks. For generations, small community banks, including minority owned banks, have been crucial to the economic vitality of low to moderate-income communities. For local communities, access to credit, loans, deposit services, financial expertise and even bank jobs are essential to daily life and economic stability. Therefore, it is imperative that this sector of America’s banking network remains viable.
The ultimate aim is that the capacity of the protégé banks will build to allow them to compete for work as Treasury financial agents. Also [I] would like to see long-term partnership evolve between mentors and protégé banks.
McDaniel: [The program] changes the paradigm and inverts the long-standing position of banks viewing one another as competitors. The program introduces the dawn of a new day where new partnerships are created and mentorship is applied, which creates a stronger national banking system, and better services and a higher degree of financial inclusivity for all Americans.
Cole: A lot of government programs are either mandated by legislation or by executive order, or by some external force. But this program was created organically...It's showing a great deal of success, members of Congress took notice and now there is legislation in process to codify this program into law.
GE: Why is having mentors to the protégé banks important?
Cole: There is complete flexibility to be creative in how mentor protégé agreements can be structured. Each of the mentor-protégé banks determine their own unique goals and parameters for the relationship, which will vary depending on the capacity and expertise of the respective banks. The types of technical assistance and growth strategies could be either narrowly specialized or broadly encompassing, as mutually determined during the early development of the mentor-protégé arrangement. Prospective technical assistance can run the gamut and could include such things as expanded banking service offerings, implementation of emerging technologies, government contracting, and mergers and acquisitions.
McDaniel: Mentors are difference makers. They have an uncommon ability to help others, and it’s these special attributes of a mentor that distinguishes Treasury’s mentor-protégé program from others.
Protégé banks gain a new business partner in the mentor (one with considerable success in the industry), and in an industry where change is so rapid and the delivery of banking services evolving (e.g., traditional brick-and-mortar bank branches are being transformed to café branches, virtual branches, and portable pop up branches where bank employees use an iPad to open customer accounts), a mentor is invaluable.
We anticipate that the mentor bank will have such an impact that the protégé won’t stay a protégé, but will one day be a mentor themself. As the protégé becomes the mentor, Treasury’s mentor protégé program becomes perpetual and thus will continuously impact the banking industry and Treasury’s network of banks.
GE: How, if at all, have the events of 2020 have affected the program?
Cole: The Bank Mentor Protégé program was established to promote greater inclusivity among banks that are providing services to the Treasury. But, we never could have imagined that minority-owned banks would play such a key role in Treasury’s economic stimulus efforts during the worst health crisis in modern history.
McDaniel: The protests and mass demonstrations in the wake of George Floyd’s death that have drawn attention to the issues of racial injustice, economic disparities, and inequalities, are events that have, if anything, been a form of validation that the purpose and guiding principles of the mentor protégé program (e.g., inclusivity; greater access to Treasury business opportunities; diversification of our bank relationships to include [minority depository institutions]) are in keeping with what the American public would expect from their government and the Treasury Department. The events of 2020 have shown the mentor protégé program is relevant and an example for others to consider following.
Cole: Minority-owned banks and other depository institutions stepped up to become lenders in the Paycheck Protection Program. According to the data from July 24, 171 Paycheck Protection Program lenders were minority depository institutions. These institutions approved over 120,000 loans that provided more than $10 billion to small businesses.
McDaniel: The pandemic events of 2020 pointed to the importance of programs such as the mentor protégé program that develop capacity and capabilities in small banks such as [minority depository institutions] that are on the front lines of serving communities most impacted by national crises.
GE: What advice would you give to young people looking to join the federal government?
McDaniel: The counsel I would give is that there is a great opportunity to make a difference [in working for the federal government], if you're looking for opportunities to learn and grow, to use your skills and your education to support an organization that is impacting various sectors of the population and the business world. Government touches all businesses, all citizens...What I have found is that there are recent college graduates, [those in their] 20s and, even, 30s, who want to serve. They want to make a difference. They want to do something that has an impact and there's no greater opportunity than in government to make a difference.
Cole: I would just add to that that there’s really no discipline that is not represented within the federal government. So there are opportunities just in all sorts of career disciplines. But not only is there a breadth, there is a lot of room to grow, to really have a long-term career within the federal government.
McDaniel: Lastly, I would just dispel some myths that maybe a 20-something recent college graduate would likely hear. I've been on the inside and I know the truth of the matter: government is a place where you can be innovative, where you can create, where you can be out of the box, where you can be entrepreneurial.