ABOUT MICHAEL PUGH:
Michael T. Pugh became CEO of LISC in October 2023. He has more than 30 years of experience in financial services, with a particular focus on expanding access to capital for underserved families, businesses, and communities. He spent more than a decade at the Harlem-based Carver Federal Savings Bank, leading the nation’s largest publicly traded African American-operated bank, with more than $720 million in assets.
Earlier in his career, Michael was a senior vice president at Capital One, N.A., where he oversaw 75 banking centers and $3 billion in deposits in Maryland, Washington, D.C., and Delaware. Prior to that, he was a senior vice president at Citizens Financial Group, leading retail banking in Michigan and Indiana and overseeing 67 banking centers.
A native of Detroit, Michael graduated from Eastern Michigan University with a bachelor’s degree in health care administration. He first became interested in community finance and helping connect people with access to capital while working as a bank teller to support himself in college. In recent years, Michael has volunteered his time on boards and in organizational leadership positions, including with The New York Bankers Association, The Economic Club of New York, the Community Development Bankers Association, and the Society for Financial Education & Professional Development.
RESOURCES:
Local Initiatives Support Corporation (LISC)
TRANSCRIPTION:
Caroline MacGregor: This is 89 one WEMU. I'm Caroline McGregor. And in honor of Black History Month, my guest today is distinguished community financial executive and Eastern Michigan University alumnus Michael Pugh. First of all, I'd like to go back to your roots. You've led an inspiring life. You were raised by a single mother who instilled in you the value of money and caring for others at the same time. And this, ultimately, led to your personal realization that financial health is just as important as physical health. Tell me about your background and what led to your passion to help underserved communities find opportunities to build generational wealth.
Michael Pugh: So, I come from a family of health care providers. I grew up in Detroit, Michigan and was reared by a strong mother who, by circumstance rather than choice, was a single parent. My father died from a car accident when I was very young, and here was this relatively young woman then left to figure out how to help bring her son along and teach him some fundamental principles in life that would allow me to be a good steward and to add value to the spaces that I'm in. And seeing a very close aunt of mine, as well as my mother, work in the health care sector, the conversations that often happened at the table were always about patience and care and a solution. And so, the paradigm for me of being in a space where I would participate, my work would be centered on care and solutions was always there. In undergrad education, I supported 100% of my funding of my education, and I worked as a certified physical therapist assistant. And so, what I learned quickly while doing that was that the circle of life was very tough as a young adult to see how people--I was doing geriatrics PT, by the way--and to see how patients oftentimes would come to nursing homes. And while physical therapy could end up being the highlight of their day, it may have been the only activity that they were having. And the interaction with people in general was very limited. Families, in some cases, would come very often for some, but others didn't have family that was visiting them. And as I got very close to a number of my patients and just came to adore them, it was very tough as a young man to go home and then come back in the next day when you hear that one of your patients has died. So, I knew that being in the medical care field was something very special, but I didn't quite think at that stage in my life I was ready for that. But I wanted to be involved in something that provided solutions and care. So, what I found, Caroline, that was very interesting is that when I applied for a job as a teller at a bank and I happened to be placed in an office that was in Dearborn Heights, Michigan, there was a large senior population. And what I found is that many of those seniors coming to the bank came for two things. One was their financial transactions. But the other thing was the sense of community and knowing that it happened to be a bank branch where people cared for them.
Caroline MacGregor: So, it sounds like your work and interactions with those elderly people impacted you to the degree that you essentially wanted to figure out ways to help other people navigate to their finances.
Michael Pugh: So, I saw solutions and care happening in the financial services sector and connected it to the experiences of what I saw in the nursing home and heard about from my family talking at the table and knew that then if I could pursue a role in financial services, I too could provide another form of care and solutions to customers and, one, that look a relief when you see someone get their first mortgage or figure out how to pay for their student loans. That was a very rewarding space to be here.
Caroline MacGregor: So, fast forward. You're now the CEO of Local Initiatives Support Corporation. And, in your position, you connect local groups with the capital and technical know-how to help forge resilient and inclusive communities locally and across America. How does it all work?
Michael Pugh: So, Local Initiatives Support Corporation., LISC, is one of the largest community development financial institutions in the country. We have three major verticals. The first one is housing. And we do that through direct lending to developers. We do it through HUD programs that allow individuals and community partners to provide the technical assistance needed, so that people can have a opportunity to get into affordable housing. Our second vertical is ten program lanes centered on wraparound services, ultimately needed to build healthy and sustainable communities. So, when you think about housing, if you place housing in any area, but it doesn't have healthy foods, education, safety programs, etc., then you essentially just placed housing in a desert. And so, our focus on these ten major programs that range from our charter school financing efforts to child care and healthy foods have all been instrumental with the sustainability and economic vitality of communities. Our third vertical has really been our strategic investments, and this is one that's very unique, where we work with municipalities to raise capital through public and private sector for the purpose of creating new housing within their communities, cities and states. And so, that has grown immensely to almost $900 million in assets under management. What it suggests is that there's a serious demand across our country now. For me, the way I got there in terms of being able to be a part of LISC and this incredible organization is I spent 30 years in financial services. And so, going back to that bank teller job and learning every aspect of bank branches with the fundamental understanding that community is created in places where you help understand goals and aspirations for individuals, and you then provide the services--the tools--to help them achieve those goals, whether it's purchasing their first home, paying off their student loan, debt consolidation, saving for their future. But perhaps, the pinnacle of my career and the turning point was becoming the CEO for Carver Federal Savings Bank. It was a community development financial institution. The work we did there, $0.80 of every dollar was reinvested in the communities that we serve. And that reinvestment was by way of helping to provide loans to small businesses and helping to support the financing of affordable housing and a number of other critical things. Caroline, that became the basis for understanding the impact and the gravity of what economic development means and how you can change communities and impact generations. If you are working very closely with partners to create solutions that are ultimately needed for housing, sustainable communities and, of course, small businesses.
Caroline MacGregor: From your story, it sounds like your mother's influence had a profound impact on your personal financial decisions. Tell me about the values that you learned from her growing up.
Michael Pugh: I remember the times as a teenager, I would say to my mother, I tell her, "Oh, the kids at school all have this new popular thing," whether it was a pair of jeans or a jacket or something. And I'd ask her, "Do you think I could have it as well?" And we would often have this conversation where we'd have to sit at the dinner table, and she would show me the budget. And she would say, "Here's the salary that I have. Here's what our expenses are for the home. And then, here's what's left. Now, based on what you want, let's talk about how you're going to get that, because this is we would have that's left." And sometimes, the answer was, "I'm sorry. It's out of our affordability range." But other times, it would be, "Yes, but it may be a little while before you get it, because, again, this is all we have left." For me, that exercise, it felt unfair at that time, because I was a kid. But as an adult, reflecting back on that, as even as early as going off to college, I realized how important those conversations and the fundamental skills were--that were being taught to me. Because if you understand the flow of money and if you can create a sense of discipline to focus on your needs before you wants, you can play a critical role in being able to build a much more financially healthy future for yourself because access to capital affords you so many things, whether it's better education, better health care, better food choices. But it starts with understanding the flow of money and the resources you have.
Caroline MacGregor: What are the disadvantages you feel are faced by Black youth today when it comes to knowing how to secure their financial future?
Michael Pugh: I think the disadvantage for any young adult that doesn't have that knowledge is that they are much more vulnerable to make poor choices in terms of their financial future. And when your margin is so tight, when you have so little to work with, which is what my experience was, there's not a lot of room to make big mistakes and blunders around how you spend those dollars. You've got to be thinking about what you need today and what you may need tomorrow and what's the path to getting there by using your dollars wisely.
Caroline MacGregor: You've been listening to financial executive Michael Pugh talking about generational wealth in Black communities. Michael, thank you for joining me today!
Michael Pugh: Thank you! It's a pleasure!
Caroline MacGregor: I'm Caroline MacGregor, and you've been listening to 89 one WEMU FM, Ypsilanti.
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