Bank of America announced today it has increased its target for equity investment in minority focused funds from $200 million to $350 million. In less than a year, the company has committed more than $250 million to 90 investment funds across the U.S. These funds provide capital to Black, Hispanic-Latino, Asian, Native American, other under-represented minority and women entrepreneurs to help them establish and grow their businesses. Today’s announcement articulates the need for more capital in funds led by diverse managers as well as the need for more growth equity funding for the minority entrepreneurs they support.
Bank of America has also completed a total of 17 direct equity investments in minority depository institutions (MDI) and community development financial institution (CDFI) banks as part of its $50 million commitment made last year.
“Equity investments in minority focused funds, MDIs and CDFI banks help address a persistent gap in access to growth capital,” said Brian Moynihan, CEO of Bank of America. “By providing this capital, we’re helping to level the playing field and open more doors for minority led businesses, entrepreneurs and innovation.”
These investments are a component of Bank of America’s $1.25 billion racial equality and economic opportunity commitment, which focuses on addressing and advancing social issues in minority populations, such as health, jobs, education, housing and capital inequality, and will facilitate benefits across multiple states and communities.
Closed investments include, but are not limited to:
The completion of these investments is subject to execution of documentation. View a list of previously announced closed funds.
Separate from the equity investment in minority focused funds, the company has also dedicated $50 million to support MDIs and CDFI banks. As part of this commitment, the company will acquire up to 4.9% of common equity in MDIs and CDFI banks facilitating benefits in the communities that these institutions serve through lending, housing, neighborhood revitalization, and other banking services. Today, Bank of America announced investments in additional MDIs. This brings the total completed investments in MDIs and CDFI banks to 17. New investments were made in the following organizations:
View a list of previously announced MDI and CDFI bank investments.
These equity investments are in addition to approximately $100 million in deposits from Bank of America in MDIs. The company also operates a $1.8 billion CDFI portfolio with 256 partner CDFIs across all 50 states, providing access to capital to thousands of individuals and small businesses who do not qualify through traditional lenders.
Since June 2020, Bank of America has already deployed $350 million across equity investments and philanthropic grants in the four areas outlined in its $1.25 billion racial equality and economic opportunity commitment. Additional Bank of America announcements focused on racial equality, diversity and inclusion and economic opportunity include:
For recent highlights of the bank’s ESG efforts, view the Bank of America 2020 Annual Report.
At Bank of America, we’re guided by a common purpose to help make financial lives better, through the power of every connection. We’re delivering on this through responsible growth with a focus on our environmental, social and governance (ESG) leadership. ESG is embedded across our eight lines of business and reflects how we help fuel the global economy, build trust and credibility, and represent a company that people want to work for, invest in and do business with. It’s demonstrated in the inclusive and supportive workplace we create for our employees, the responsible products and services we offer our clients, and the impact we make around the world in helping local economies thrive. An important part of this work is forming strong partnerships with nonprofits and advocacy groups, such as community, consumer and environmental organizations, to bring together our collective networks and expertise to achieve greater impact. Connect with us on Twitter (@BofA_News).
Kelly Sapp, Bank of America