Impact Finance and Latino-Focused CDFI Collaborate To Close Opportunity Gaps
Recent investments with Raza Development Fund total more than $12 million
Originally published on U.S. Bank company blog
Last month, U.S. Bancorp Impact Finance provided a $2 million equity-equivalent investment (EQ2) in Raza Development Fund (RDF) to help fund community health centers in Latino neighborhoods across the state of California. The partnership was one of many investments - ranging from New Market Tax Credits transactions to successful expansions of financial solutions across various U.S. Bank business lines - that Impact Finance has made in the past six years in RDF, the largest national, Latino-focused Community Development Financial Institution (CDFI).
“This transformative investment in Comunidad Sana, our health equity initiative, not only allows us to expand our reach but also strengthens the essential work of community health centers. These centers are lifelines in underserved communities, providing critical health services and ensuring that quality care is accessible to all. By deepening our commitment to health equity, we are fostering healthier communities, reducing disparities, and laying the foundation for long-term, systemic change,” said President & CEO Annie Donovan.
Driven by a mission to close wealth and opportunity gaps in Latino and other under-resourced communities across the United States, RDF provides financial solutions to community-based organizations focused on health, education, affordable housing, climate resilience, homeownership and entrepreneurship.
In addition to the EQ2 investment to support Raza’s Comunidad Sana Fund, which plans to deploy capital to Federally Qualified Health Centers and other community health centers in Latino communities across the state of California, Impact Finance and RDF in August 2024 closed on a $10 million Racial Equity Direct Purchase Bond through U.S. Bank’s Impact Capital Program that will help support RDF lending programs within the state of California.
“RDF values U.S. Bank as a key partner and strong supporter of our mission,” said Donovan. “Our collaboration encompasses various forms of financial support, knowledge sharing and strategic partnerships. Our relationship with U.S. Bank exemplifies the power of these collaborations. Through shared values and a commitment to advancing economic opportunity, we’ve built a partnership that allows us to amplify our collective impact.”
Lastly, through U.S. Bank’s Community Development Entity, Impact Finance provided RDF a $100,000 grant to support the organization’s upcoming 25th anniversary, a two-day Latino Leadership Summit to be held in Los Angeles, and a landscape study of Latino-led and Latino-serving CDFIs.
“These recent opportunities help expand the existing relationship between U.S. Bank and RDF, and more importantly help support the mission for the largest Latino-focused CDFI in the country,” said U.S. Bancorp Impact Finance Vice President Garrett Murdock.
CDFIs play a critical role in bringing investment and resources to underserved communities and to organizations that may not have access to traditional financing. Last year, Impact Finance committed $534 million in loans to CDFIs and other community development intermediaries.
“We are proud of the longstanding partnership with U.S. Bank. Over the years, U.S. Bank has been a trusted ally in supporting our mission and innovation, and together we continue to deliver exceptional financial solutions that make capital available to our underserved communities," said RDF Chief Financial Officer Tony Lopez. “U.S. Bank has taken the time to understand our mission and connect with our team and the communities we serve. This strong relationship has not only empowered RDF to be a responsible steward of capital but also created impactful opportunities that benefit the people and communities at the heart of our work.”
Combining the financial strength and expertise of institutions like U.S. Bank with the deep local knowledge and mission-driven focus of CDFIs, helps create lasting, positive change, Donovan said.
“Together, we’re shaping a future where opportunity and financial inclusion are accessible to all,” she said.
