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Debt capital investments are low or no-interest earning investments made in the Loan Fund's loan pool by financial institutions, religious organizations, individuals or other public, private or corporate organizations. Debt capital is secured by the Loan Fund's equity capital. (See Equity Investments.) It is this type of investment that extends the scope and reach of the Loan Fund's lending activity throughout the state in the loans we make for affordable housing, essential social services, economic development and other special needs lending initiatives. Debt capital investments range in size from a $1,000 investment by an individual to $1,000,000 investment by a leading financial institution. These investments carry an average rate of return of 2.15%. Debt capital investments are not tax deductible but they are recoverable by the investor upon the date of maturity. Because the Loan Fund is a federally certified community development financial institution (CDFI), financial institutions can receive Community Reinvestment Act credit for making this type of investment in the Loan Fund. |
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