Treasury Department Selects Bank of America as First Financial Partner in New Program to Help Underserved Communities
Program Addresses Critical Gap in Financing Affordable Housing, Small Business, Health and Education Projects in Low- and Moderate-income Communities
WASHINGTON, D.C. – October 2, 2013 – (RealEstateRama) — Bank of America has been selected as the first Qualified Issuer of loans to Community Development Financial Institutions (CDFIs) through the U.S. Department of the Treasury CDFI Bond Guarantee Program. The selection was announced on September 30.
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Treasury created the CDFI Bond Guarantee Program to address a gap: limited access to 30-year capital for community projects in underserved areas. Without access to long-term financing, community-based organizations are often required to line up multiple short-term loans from various sources, redirecting time and attention away from creating positive impact in communities.
“The Bond Guarantee Program will raise visibility of the incredibly important work CDFIs do, which often goes unnoticed or underappreciated,” said Bank of America Corporate Social Responsibility and Consumer Policy executive Andrew Plepler. “Our designation as a Qualified Issuer will allow us to have an even greater impact when it comes to improving local economies and the communities we serve.”
Bank of America’s first transaction under the program will be a $100 million loan to two long-term clients – Enterprise Community Loan Fund (Enterprise) and the Local Initiatives Support Corporation (LISC). Enterprise and LISC will use the funds to make 30-year permanent loans to multi-family housing developments, charter schools, and health care clinics.
“This kind of secure, long-term financing will help us create economic opportunity for more people in more places,” said Michael Rubinger, president and CEO of the Local Initiatives Support Corporation (LISC). “Bank of America continues to be an invaluable partner in our efforts to make even severely distressed neighborhoods better places to live, work, do business and raise families.”
“Our award under the CDFI Bond Guarantee Program strengthens Enterprise’s ability to provide long-term, fixed rate financing that is otherwise unavailable for local community serving developments where the permanent loan is too small for an efficient and economical agency execution,” said Lori Chatman, president, Enterprise Community Loan Fund, Inc. “We look forward to continuing our relationship with Bank of America.”
As the nation’s largest lender to CDFIs, Bank of America administers a $1.2 billion loan portfolio to more than 240 CDFIs in all 50 states, plus Washington, D.C. and Puerto Rico. The impact of this creates affordable housing development, increased access to quality education and health care, funding for small businesses, and economic development in communities.
The U.S. Department of Treasury Bond Guarantee Program provides a full government guarantee on bonds to fund community development activities financed through CDFIs. Up to $500 million is available this year with the potential of up to $1 billion available next year.
Bank of America Corporate Social Responsibility
Bank of America’s commitment to corporate social responsibility (CSR) is a strategic part of doing business globally. Our CSR efforts guide how we operate in a socially, economically, financially and environmentally responsible way around the world, to deliver for shareholders, customers, clients and employees. Our goal is to help create economically vibrant regions and communities through lending, investing and giving. By partnering with our stakeholders, we create value that empowers individuals and communities to thrive and contributes to the long-term success of our business. We have several core areas of focus for our CSR, including responsible business practices; environmental sustainability; strengthening local communities with a focus on housing, hunger and jobs; investing in global leadership development; and engaging through arts and culture. As part of these efforts, employee volunteers across the company contribute their time, passion and expertise to address issues in communities where they live and work. Learn more at www.bankofamerica.com/about and follow us on Twitter at @BofA_Community.
Reporters May Contact:
Noelle Bell, Bank of America, 1.704.264.6772