Bond represents the largest single bond loan to ever be originated through the U.S Treasury’s Bond Guarantee Program and brings Clearinghouse CDFI’s total issuance to $350 million since 2014
LAKE FOREST, CA – November 1, 2018 – Clearinghouse Community Development Financial Institution (Clearinghouse CDFI)—a mission-based financial institution serving low- to moderate-income communities in California, Arizona, New Mexico, Nevada, and Sovereign Nations—announced today that it has closed a $150 million bond from the United States Treasury Department’s CDFI Bond Guarantee Program (BGP) issued through the Community Reinvestment Fund, USA (CRF). Clearinghouse CDFI’s 2018 bond is the largest, single bond loan to ever be originated through the U.S Treasury’s CDFI BGP, and the third time that Clearinghouse CDFI has been a bond recipient. Since 2014, Clearinghouse CDFI has been issued $350 million in total bonds from the program—the most of any institution.
Clearinghouse CDFI will use the bond to finance community development projects in underserved areas throughout California, Arizona, New Mexico, Nevada, and Sovereign Nations. CRF will serve as the Qualified Issuer (QI). Enacted as part of the Small Business Jobs Act, the CDFI Bond Guarantee Program (BGP) is an innovative federal credit program that is designed to function at zero cost to taxpayers. It provides eligible CDFIs access to long-term capital to encourage economic growth and development. Eligible CDFIs must demonstrate financial strength, experienced management, and provide strong collateral to be considered for the BGP. Clearinghouse CDFI met the rigorous qualification standards in 2013 and was approved to participate in the program’s inaugural round. In July 2014, Clearinghouse CDFI became the first institution to close a BGP bond.
“We are very grateful that the U.S. Treasury has again selected us to be a recipient of this very innovative bond program for the third time,” said Clearinghouse CDFI President and CEO, Douglas Bystry. “Since its inception, the BGP has served as a model for government programs—effectively deploying capital to the communities that need it most, creating jobs, and making a positive impact on local economies. As stewards of these funds, we are proud that they have brought real change to the communities we serve.”
From past issuances, Clearinghouse CDFI has since financed a total of 158 loans in 81 municipalities with U.S. Treasury BGP funds. These loans, ranging in amount from $125,000 to over $9 million, will eventually benefit more than 474,000 individuals. Examples include:
- Teach, Inc. (Red Hook Teach II), Los Angeles, CA—$7.6MM in financing to establish a high impact charter middle/high school that provides quality education to a low-income population.
- Bristlecone Family Resources, Reno, NV—$1.4MM in financing for this nonprofit to preserve its residential addiction treatment programs serving veterans and low- to no-income individuals.
Clearinghouse CDFI has funded $1.55 billion in total loans for over 1,820 community projects over the past 21 years. These projects have created or retained more than 18,000 jobs and benefit over 1.5 million individuals. This includes the rehabilitation of more than 16.9 million square feet of blighted properties. These projects have benefited over 610 separate underserved communities throughout California, Nevada, Arizona, New Mexico, and Sovereign Nations.
“It is a privilege to be working with Doug and his team at Clearinghouse CDFI. We know they are eager to put this new BGP financing to work generating sustainable economic activity in targeted communities throughout California, Nevada, Arizona, and New Mexico,” said Jennifer Novak, CRF Senior Vice President Capital Markets. “As one of the first organizations certified to issue CDFI bonds in 2013, CRF understands and appreciates the transformative power of this financing tool. We see ourselves as stewards of this unique program – sharing the responsibility to preserve and grow the use of bond resources with Clearinghouse and our other CDFI partners. Today, we celebrate this $150 million bond issued on behalf of Clearinghouse CDFI – as well as Treasury’s announcement that over $1.5 billion in BGP backed financing has been invested in low-income communities across the country.”
About Clearinghouse Community Development Financial Institution:
Clearinghouse Community Development Financial Institution (Clearinghouse CDFI) addresses unmet credit needs in California, Nevada, Arizona, New Mexico, and Sovereign Nations in the Western United States. Clearinghouse CDFI is an industry leader helping to bridge the gap between conventional lending standards and the needs of low-income and distressed communities. Clearinghouse CDFI is also a B Corp–a certification received from the nonprofit B Lab. B Corps are companies who meet rigorous standards of social and environmental performance, transparency, and accountability, and use business as a force for good. More information is available at: www.ccdfi.com.
About Community Reinvestment Fund:
Founded in 1988, Community Reinvestment Fund, USA (CRF) is a national non-profit organization with a mission to empower people to improve their lives and strengthen their communities through innovative financial solutions. A leading Community Development Financial Institution (CDFI), CRF supports mission-driven organizations through the development of products and services aimed at increasing the flow of capital to historically underinvested communities across the country. CRF has injected more than $2.4 billion to help stimulate job creation and economic development, provide affordable housing, and support community facilities. For more information, visit www.crfusa.com.
Ron Demeter, Partner
Vectis Strategies on behalf of Clearinghouse CDFI
Download as a PDF: 2018 CCDFI Bond Issuance