Banking on Change Part 2: Cambridge Savings Bank

Robert Sondak

The Cambridge Savings Bank is a financial institution whose history spans 176 years. This Harvard Square headquartered bank has grown despite weathering three periods of economic hardship over the past 110 years.

During the depression of the late 1930s, President Franklin Delano Roosevelt created the Works Progress Administration (WPA). The WPA employed a total of 3.8 million people, with total expenditures through 1941 at 11.5 billion dollars. At the time this federally subsidized program provided a significant boost to the national economy.

Six and a half decades after WWII, the meltdown of the banking and financial markets commonly referred to as the Financial Crisis of 2008, has taken place largely under the administration of Barrack Obama. President Obama utilized the Federal Reserve Bank to implement and manage the Troubled Asset Relief Program (TARP) and a second stimulus known as the Capital Purchase Program (CPP). The CPP created a second layer of funding to enable local banks to continue community development work in the turbulent economy of 2008 to the present.

The Federal Reserve Bank itself has a long history, having been created at the start of the 19th century during the presidency of Theodore Roosevelt. The FRB was developed during the “Bankers Panic” in 1907, in which the New York Stock Exchange fell 50 percent from the previous year. This drop swept many state and local banks into bankruptcy.
To commemorate its 175 birthday, the Cambridge Savings Bank created a socially conscious marketing contest, a year after the 2008 financial crisis. The event asked customers and the public at large to vote for their favorite local nonprofit.
The contest was designed so that the four local community nonprofits receiving the most votes would share a gift between them, with a grand prize for the highest vote. These signature gifts and the grand prize would be granted by the Cambridge Savings Charitable Foundation.

This “Name Your Favorite Non-Profit” contest was initiated during the fourth quarter of 2009 in a very difficult environment of economic recession. The competition’s focus was to help introduce the bank’s social mission, which is to help make a difference in the communities it serves. Such a vision would be realized by providing traditional business and consumer services while also providing funding for affordable housing through a variety of service organizations. The general public was directed to Cambridge Savings Bank’s website and select their favorite nonprofit that supports local communities.
Through the Cambridge Savings Charitable Foundation, a total of $175,000 was given to a series of community-based nonprofit organizations located in Eastern Massachusetts. This contest featured a Signature Gift (SG) of $100,000, split equally among four non-profits. Winners included the Housing Corporation of Arlington, the only non-Cambridge SG winner, which provides and advocates for affordable housing for low to moderate income families and individuals. The Salvation Army of Cambridge, the second SG winner, provides a wide array of services including operating a large urban transitional shelter, a meals program, food pantry, and social services for homeless and low-income families and individuals. The Home-Owners Rehab, Inc. of Cambridge, the third SG winner, has developed mixed income housing units and owns units for low to moderate income families. Just-A-Start Inc. of Cambridge, the fourth SG winner, provides affordable and rehab housing along with tenant-landlord dispute services and youth programs.

Of all the nonprofits featured in the Cambridge Savings Bank’s contest, the Cambridge Housing Assistance Fund (CHAF) received the most votes and won the grand prize of $20,000. CHAF is a Cambridge-based nonprofit with a mission to break the cycle of homelessness by raising funds to assist homeless and nearly homeless individuals to seek permanent housing. CHAF was founded about 20 years ago by the Cambridge Council of Realtors as a response to the growing number of people experiencing homelessness within the city. Since its inception, CHAF has helped 1,300 families to transition to stable homes. This represents a total population of approximately 3,000 people.

Two other organizations that garnered a large number of votes were the Newton National Center For Family Homelessness (NNCFH) and the Bedford Veterans Quarter (BVQ), each of which received $10,000. NNCFH was created as a collaboration between the editor of Better Homes and Gardens Editor David Jordan and Ellen L. Bassuk, M.D., Associate Professor of Psychiatry at Harvard Medical School. NNCFH has since created a series of programs for homeless veterans, mothers and children, that focus on health and nutrition, physical activity, and well-being. The BVQ provides rent-subsidized housing to veterans. They also deliver a wide range of services at their Bedford campus, including medical care, recreational facilities and counseling. The remaining $35,000 from the competition was split equally among the Concord Housing Authority, Caritas Communities, the Lexington Housing Partnership, Watertown Community Housing and the Homeowners Option for Massachusetts Elders of Action, Belmont and Burlington.

I recently interviewed Karen (Quinn) Marryat, Senior Vice President and Chief Marketing Officer of Cambridge Savings Bank by phone at her Harvard Square office. I was interested in learning background information about the CSB Anniversary Contest.

Robert: Who was allowed to vote in the Anniversary contests?
Karen: There was really no restriction. We did ask people who were customers or the working adult public to vote.

R: When were the contest winners announced?
K: The Signature Gifts winners were announced first. The Grand Prize and two accompanying second and third place winners were announced in early January 2010.

R: How long did the contest the two contests run?
K: The contest ran until the fourth quarter of 2009.

R: Were there any contest prize give-aways for the consumer voting public?
K: Voters could register for a Harvard Square weekend. This included hotel accommodations and local gift certificates.

R: Which non-profit won the grand prize?
K: The Cambridge Housing Assistance Fund received the most votes and won the $20,000 grand prize. CHAF received the largest vote total of all ten nonprofits.

The Cambridge Savings Bank’s 175th Anniversary Contest exemplifies a bank that has a social mission to serve the local communities it works with. The ten organizations that won Signature Gifts and the Grand Prize represent a group of seasoned nonprofits. These organizations work daily with the homeless, low and moderate-income individuals and families.

Soft Second Loan Program

Another component to Cambridge Savings Bank’s social mission is to implement initiatives that help to provide housing in the communities in which the bank has branches for low to moderate-income families. As one of the three Cambridge-based banks, CSB participates in a local housing initiative called the Soft Second Loan Program (SSLP).
The SSLP represents a collaborative state and private housing program that combines a traditional mortgage with a subsidized second mortgage to help low to moderate-income households qualify for a mortgage. These mortgages come with low fixed interest rate, usually 1/4 to 1/2 below the standard market rate, and require a low down payment, the minimum of which is 3 percent of the purchase price. The second mortgages include no associated mortgage insurance and do not come with the points and fees that banks typically ask the borrower to pay when buying a house.

The Department of Housing and Community Development, the state agency coordinating the program, contributes 4 million dollars to the SSLP annually, depending on available funds. Federal funding is also provided through the Neighborhood Stabilization Program. Since its inception, the SSLP has helped 14,000 families buy their first home. These 14,000 families represent a total of 40 to 50,000 people. In total, the program has leveraged 2 billion dollars in mortgage financing.


Local community banks like CSB and Wainwright Bank, which I previously wrote about in the first article in this series on social banking, play a very important role in eastern Massachusetts. Both of these banks help to facilitate stable housing for families with limited funds, meaning low-income or those who are slightly below the state median of $50-55,000. The major difference between the two banks is that Wainwright focuses on community development in one of three roles: those of funder, intermediary or project consultant. Cambridge Savings on the other hand works directly as a mortgage provider and facilitator of housing initiatives proximal to its sixteen branch locations in eastern Massachusetts.

Take the time to support the ten organizations that I have highlighted in this article. I also encourage you to call or write Governor Patrick and express the continued need to support the Soft Second Loan Program.
In an environment of economic recession, housing initiatives play a major role in assisting people with limited incomes to satisfy the American Dream—that is to buy their own home.

Robert Sondak is a Spare Change Staff Writer vendor. Robert has a Bachelors Degree from the University of Massachusetts Boston, College of Public and Community Service (CPCS). Robert also minored in planning and advocacy.

Robert Sondak is a vendor and a writer for Spare Change News.