Carlos Naudon, a former certified public accountant, lawyer and consultant, says he has always had an interest in banking and helping the Latino community. As president and CEO of Ponce Bank and Ponce Financial Group, he gets to combine both interests.
GREW UP Santiago, Chile; moved to Baltimore when he was 13
RESIDES East Harlem during the workweek, though his family’s home is in Prospect Heights
EDUCATION Bachelor’s in economics and computer science, University of Maryland; master’s in accounting and finance, University of Rochester; J.D., Brooklyn Law School.
SPARE TIME When he isn’t at work, Naudon plays tennis, fishes, boxes and practices yoga.
FAMILY LIFE Naudon is married, and he and his wife have two adult children.
Carlos Naudon, a former certified public accountant, lawyer and consultant, says he has always had an interest in banking and helping the Latino community. As president and CEO of Ponce Bank and Ponce Financial Group, he gets to combine both interests.
Ponce Bank has grown to $2 billion in assets since Naudon became president in 2015. Located in Parkchester in the Bronx, Ponce serves predominantly minority New Yorkers.
With the pandemic having left Black and brown communities in an especially vulnerable position, Naudon seeks to help strengthen these neighborhoods. Minorities won’t always be in the minority, Naudon notes, which is why it’s essential to address economic imbalances now.
Why is it important for banks to focus on minority businesses?
The reality is that when there’s an event that affects everybody—an economic event or weather event—the resiliency of many of the minority communities is much less than the majority communities. So it behooves us as a nation to strengthen those communities, to help them become more resilient, economically, financially and health-wise. The pandemic certainly reinforced the fact that that needs to happen. From the financial provider perspective, it’s an available market, it can be done profitably, and it’s in the national interest.
What advice would you give to lenders about working with minority-owned businesses?
You have to understand the culture of the minority population that you serve. You need to be able to have the customer feel comfortable with the culture [of] the bank. Hopefully, you can have folks that speak the same language and understand the culture of the prospective customer, because that’s going to help a lot more. There are lots of people who have come to this country with bad experiences with banks from their country. You have to recognize that and try to break those barriers that exist.
How has community-focused banking supported the financial viability of small businesses during the pandemic and in the post-pandemic era?
The pandemic demonstrated to the rest of the country that community banks, particularly minority depository institutions and community development financial institutions, were highly effective in funneling stimulus and aid to small local communities. They served as the model, which the government then followed to place funds into communities that were disproportionately affected by the economic slowdown that occurred. Those programs have been extremely successful in getting resources to the local communities, and what we did in New York City was repeated in many large cities and small towns throughout America by the small clearing banks, banks that are in the community and for the community.
Many people started small businesses during the pandemic. Do you have advice for these entrepreneurs on how to know when it’s time to scale up?
Don’t look at tomorrow; look at the longer-term view and adjust accordingly. As the pandemic has eased, there has to be an honest assessment and analysis of the business, and the first question that needs to be asked is, ”Is the business dependent on the continuity of the harsh times of the pandemic? Or is it not dependent and therefore I can continue what I’m doing?” There has to be an adjustment to the economic times. The person who just started the business two or three years ago needs to constantly think about how the business will be affected by increasing interest rates and a possible recession if they don’t have a soft landing.
What’s the outlook for New York’s small businesses in the next decade?
There has to be an effort by the city and state of New York to encourage the formation, survival and thriving of small businesses, because that’s what’s going to eventually push the economy, the revenue and the employment base of the city. There are practices today by the city, state and federal government that are counterproductive for businesses. Lack of capital and access to capital is the number one reason for failures of small businesses. Financial institutions like ours should be encouraged with small-business lending by the regulatory agencies, not discouraged. Many of the capital requirements and collateralization requirements are not supported for small-business lending.
