Bond Guarantee Program
Fixed-rate, long-term, and low-cost capital for CDFIs
The U.S. Treasury’s CDFI Bond Guarantee Program gives eligible CDFIs access to fixed-rate, long-term and low-cost capital. CRF helps community lenders access the program so they can invest in a range of qualified community revitalization projects. The program has been recognized as one of the most unique financing tools available to support the growth of community development.
Unlike other CDFI Fund programs that offer direct loans, grants, or allocations, the BGP is an innovative federal credit program, designed to function at no cost to taxpayers, that offers credit worthy CDFIs access to long-term, enterprise capital with fixed rates through the sale of federally guaranteed bonds purchased by the Federal Financing Bank. These CDFIs, in turn, can draw down long-term, fixed-rate debt under BGP to support long-term, fixed-rate Secondary Loans to businesses and developers in distressed communities.
The Community Development Financial Institutions (CDFI) Bond Guarantee Program was enacted through the Small Business Jobs Act of 2010 and will inject new and substantial capital into our nation’s most distressed communities. Through the Bond Guarantee Program, eligible CDFIs have access to fixed rate, long-term and low-cost capital. Loans can be used to finance eligible community and economic development purposes, such as small businesses, charter schools, health care facilities, affordable housing and much more.
Total CRF issuance are greater than $1 billion since 2014. CRF is authorized to submit Guarantee Applications, on behalf of eligible CDFIs, to issue bonds that are worth a minimum of $100 million in aggregate and 100 percent guaranteed by the Department of Treasury. The bonds are purchased by the Federal Financing Bank (FFB).
Eligible CDFIs must meet the following criteria:
Maintain a Certified CDFI designation in good standing with the U.S. Department of Treasury.
Critical access thresholds to program: Minimum 3–5-year historical track record of lending in defined Asset Classes, strong tangible net worth and profitability. BGP also considers delinquency ratio trends, leverage and robustness of lending policies and procedures.
Requisite management and tangible evidence of LIC support through its priorities, partnerships, and loan products and services.
Learn more about the Bond Guarantee Program through the CDFI Fund
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Founded in 1988, Community Reinvestment Fund, USA (CRF) is a national non-profit organization with a mission to improve lives and strengthen communities through innovative financial solutions. A leading Community Development Financial Institution (CDFI), CRF supports mission-driven organizations, increases economic mobility, and builds strong local economies through the development of solutions aimed at creating an equitable financial system. CRF has injected more than $3.6 billion to stimulate job creation and economic development and support community facilities.