In a recent press release, the Community Development Financial Institutions (CFDI) Fund announced that the CDFI Bond Guarantee Program is beginning to guarantee bonds issued in support of low income, underserved, and rural community development. To help stand up the program, the CDFI Fund engaged Summit to provide expertise in loan program design, CDFI underwriting, and Federal Credit compliance.
FY 2013 marks the inaugural year of bond issuance for the program, which is administered by the CDFI Fund, part of the U.S. Department of the Treasury. The release notes that the participating CDFIs, which are individual and localized institutions dedicated to community development, “have a solid history of delivering innovative financial products that stimulate job growth … [and] increase the accessibility of small business loans, quality affordable housing, and community facilities.”
The bonds guaranteed by the CDFI Bond Guarantee Program must be repaid according to the bond’s terms, a facet of the program which was designed to allow it to function at very low cost to taxpayers. Summit supported every aspect of programmatic development, including researching and designing risk mitigation tools and strategies. As noted in a previous story, the Summit Team traveled across the U.S. in support of this engagement, providing training and education to potential applicants.
To read the full text of the press release, visit the CDFI Fund’s website.