ImpactAlpha, Sept. 23 – Microsoft and Truist Financial are anchoring a new federal fund for community banks.
The Mission-Driven Bank Fund from the Federal Deposit Insurance Corp. will provide capital to minority depository institutions and community development financial institutions that provide financial services to minority, lower income and rural communities.
“One of the things that I heard in the beginning, and in particular for Black banks, was a lack of capital,” FDIC Chair Jelena McWilliams told CNBC. “Finding good capital to come to the banks was the No. 1 thing.” Discovery joins Microsoft and Truist Financial for a combined commitment of $120 million.
The anchor investors are currently hiring a fund manager expect a first close of the fund by year’s end. Eligible banks will be able to share their pitches early next year. Commercial banks could also potentially receive Community Reinvestment Act credit for investing in the fund.
