Community Development Banking News
CDFI Banking: Industry, Policy, and Beyond.
"The Supreme Court ruled on Thursday that the Consumer Financial Protection Bureau's funding is constitutional and satisfies the requirements of the Appropriations Clause.
The majority 7-2 opinion by Justice Clarence Thomas was joined by Chief Justice John G. Roberts, Jr. and Justices Elena Kagan, Brett M. Kavanaugh, Sonia Sotomayor, Amy Coney Barrett and Ketanji Brown Jackson. A dissenting opinion was filed by Justice Samuel A. Alito, Jr., who was joined by Justice Neil M. Gorsuch. A separate concurring opinion was filed by Justice Kagan, joined by Justices Sotomayor, Kavanaugh and Barrett. Justice Jackson filed a separate concurring opinion."
"Today, the House Financial Services Committee, led by Chairman Patrick McHenry (NC-10), reported eleven pieces of legislation out of Committee favorably to the full House for consideration. These include a slate of financial institutions, capital markets, and housing legislation to improve efficiency and accountability at federal agencies, as well as expand economic opportunity."
"Senator Mark Warner (D-VA) released a letter to the Senate Appropriations Committee on Fiscal Year 2025 CDFI Fund appropriations. A total of 48 Senators signed the letter, which supported an appropriation of $325 million for the Fund. The letter includes 11 Members of the Appropriations Committee and 4 Republican Senators: Rounds (SD), Daines (MT), Crapo (ID), and Cassidy (LA). Sens. Crapo and Daines signed on the for the first time. Sens. Warner and Crapo are Co-Chairs of the Senate Bipartisan Community Development Finance Caucus. Other Caucus Members who signed include Klobuchar (D-MN), Ossoff (D-GA), Reed (D-RI), Smith (D-MN), Warnock (D-GA) Peters (D-MI), Hickenlooper (D-CO), Schatz (D-HI), Wyden (D-OR), Booker (D-NJ), Rounds, Cassidy, and Daines.
Last month, Representatives Barbara Lee (D-CA) and Don Bacon (R-IL) led the bipartisan House letter, which garnered 96 signatures. That letter requests $341 million, which is $17 million above the enacted FY 24 level for the CDFI Fund. Attached please find both letters.
To a remarkable degree, the FY 25 appropriations outlook is unsettled. Today House Appropriations Committee Chairman Cole (R-OK) reiterated that when the Committee begins marks in late May or June, the topline number for domestic programs will be $710 billion, as established in the Fiscal Responsibility Act (FRA) , Public Law 118-5, which is roughly $60 billion below the FY 24 level. The Senate Appropriations Committee has not yet indicated its approach, but it likely to propose a higher number for domestic programs than set in the FRA. Neither the House nor the Senate will complete appropriations bills by the end of the fiscal year. When it returns from the August recess, Congress is likely to pass a Continuing Resolution (CR). With elections approaching, Congress will adjourn at the end of September. After the election, a lame duck session will have long list of legislation to consider including appropriations, taxes, and the farm bill."
"The Federal Reserve Bank of New York today released a report quantifying sales of loans by Community Development Financial Institutions (CDFIs). The report, "Examining the Origination and Sale of Loans by Community Development Financial Institutions," finds the amount of loans originated by CDFIs more than doubled between 2018 and 2022, reaching $67 billion. The amount of loans sold by CDFIs also more than doubled during the same period, reaching $14.2 billion, the report finds."
"Today, the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) opened the fiscal year (FY) 2024 funding round for the Bank Enterprise Award Program (BEA Program). Application materials are now available on the BEA Program page of the CDFI Fund's website in anticipation of the publication of the FY 2024 Notice of Funds Availability (NOFA) in the Federal Register on April 29, 2024. The FY 2024 BEA Program NOFA states that up to $40 million is available in awards to eligible Federal Deposit Insurance Corporation (FDIC)-insured depository institutions."
CDBA would like to congratulate members John Lewis (Harbor Bank of Maryland) and Arturo Ortega (Freedom Bank) on being named to the FDIC's MDI Subcommittee to the Advisory Committee on Community Banking.
"The Federal Deposit Insurance Corporation (FDIC) today announced four new members of the agency's Minority Depository Institutions (MDI) Subcommittee to the Advisory Committee on Community Banking:
- John Tom Anderson, President and CEO, F&M Bank, Edmond, Oklahoma
- John Lewis, President and CEO, The Harbor Bank of Maryland, Baltimore, Maryland
- Alfonso Macedo, President & CEO, Ocean Bank, Miami, Florida
- Arturo (Art) Ortega, Chairman and CEO, Freedom Bank, Alamo, Texas"
"Today, Congressman Dave Joyce (OH-14) announced his appointment to serve as Chairman of the Financial Services and General Government (FSGG) Subcommittee on the House Appropriations Committee.
'I am honored to be appointed to such a critical and pivotal position on the Appropriations Committee. In this role, I will work with my colleagues to strengthen U.S. financial markets and ensure taxpayer dollars are spent responsibly. I thank Chairman Cole for entrusting me to lead our country back to a path of fiscal responsibility,' said Congressman Joyce.
The Financial Services and General Government Subcommittee has appropriations jurisdiction over a wide range of federal agencies—including the Internal Revenue Service, Department of the Treasury, District of Columbia, Judiciary, Executive Office of the President, Securities and Exchange Commission, Small Business Administration, Federal Trade Commission, Federal Communications Commission, Federal Deposit Insurance Corporation, Consumer Product Safety Commission, Office of Personnel Management, and the U.S. Postal Service."
Why it matters: Cole will be tasked with leading the powerful panel that oversees crafting government funding bills [including the Department of Treasury and CDFI Fund]
- The shuffle comes after Granger — who is set to retire at the end of this term — decided to step down from the position shortly after passing FY 2024 spending packages."
"The Mission Driven Bank Fund today announced its initial investments in Community Development Financial Institution (CDFI) and Minority Depository Institution (MDI) banks committed to expanding financial services in underserved communities. The Fund aims to help close the racial wealth gap by meeting the banks' needs through below-market and flexible investment vehicles and subsidized technical services curated to build sustainable change for the sector.
The Fund, encouraged by the Federal Deposit Insurance Corporation (FDIC), and anchored by Microsoft and Truist, recently announced its first investor close at the end of last year. While it is raising more capital throughout 2024, it wanted to begin meeting the needs of its growing pipeline of CDFI and MDI banks right away.
Paul Welch, the Fund's portfolio manager, said, 'The Fund has been well received by our mission focused bank sector and we look forward to continuing to support building capacity within their communities.'
Initial investments include:
- Embassy National Bank, an MDI serving primarily South Asian communities throughout the state of Georgia.
- Legacy Bank and Trust, a CDFI bank with locations in Missouri, Oklahoma, and Texas, and affordable housing and community development lending niches prioritizing majority minority communities, American Indian reservations, and persistent poverty counties across the country.
- Priority Bank, a CDFI providing rural, small business, and affordable housing mortgage loans in Ozark and Northwest Arkansas.
In addition to the $18 million in aggregate financing deployed into these banks, we believe they will start to benefit from the tailored technical services program designed to build organizational capacity and the growing network of vendor relationships the Fund provides."
The Justice Climate Fund, of which CDBA is a proud member, has been awarded a $940 million Clean Communities Investment Accelerator grant by the EPA!
CDBA, in partnership with Partners (PCG), will serve as the CDFI bank hub in coordinating these grants along with training and technical assistance. This role enables us to lead initiatives in environmentally friendly lending, providing a great opportunity to significantly benefit our communities.
"EPA announces eight selections under the Greenhouse Gas Reduction Fund's National Clean Investment Fund and Clean Communities Investment Accelerator through President Biden's Investing in America agenda
Justice Climate Fund ($940 million award), a purpose-built nonprofit supported by an existing ecosystem of coalition members, a national network of more than 1,200 community lenders, and ImpactAssets—an experienced nonprofit with $3 billion under management—to provide responsible, clean energy-focused capital and capacity building to community lenders across the country."