WASHINGTON–The Federal Deposit Insurance Corporation (FDIC) has announced the launch of a new Mission-Driven Bank Fund, which it described as a capital investment vehicle being developed by the FDIC to support insured Minority Depository Institutions (MDIs) and Community Development Financial Institutions (CDFIs).
According to the FDIC, as anchor investors, Microsoft and Truist Financial Corp. will lead the investment fund. In addition, Discovery, Inc. will join as a founding investor in the Fund bringing the combined initial commitment to $120 million, with additional investments expected.
The FDIC said it designed the framework for the Mission-Driven Bank Fund to channel private capital and other resources to these institutions, allowing them to amplify the impact of investments in the communities they serve.
“Microsoft and Truist have answered the call to become anchor investors and to assist the FDIC in developing this Fund for the benefit of mission-driven banks and, most importantly, the people and places these institutions serve,” said FDIC Chairman Jelena McWilliams. “It is our hope that with the commitment of these industry leaders, more private equity investors will join the growing ranks of those committed to building opportunity and prosperity where this support is needed the most.”
About the Fund
According to the FDIC, the Mission-Driven Bank Fund is a collaborative investment framework to drive capital investment and other funding to FDIC-insured MDIs and CDFIs that support low- and moderate-income, minority, and rural communities, enabling them to build size, scale, and capacity to in turn allow them:
- To provide affordable financial products and services to individuals and businesses
- To stimulate economic and community development
- To build opportunity and prosperity
CEOs Surveyed
The FDIC said that in designing the framework of the Fund, the FDIC engaged approximately 70 CEOs of MDIs and CDFIs and their trade groups as well as potential investors, investment consultants, and philanthropic organizations.
The FDIC said the creation of the fund supports its commitment to preserving and promoting mission-driven banks. The FDIC will retain an advisory role to support the fund’s mission focus, but will not contribute capital to, manage, or be involved in investment decisions of, the fund.