With the goal of helping increase black wealth, Bank of America is boosting its investment in venture capital funds that support minority entrepreneurs.
TThe nation’s second-largest bank raises its equity investment target in minority-focused funds to $ 350 million, from $ 200 million. The new measure will allow the Charlotte, North Carolina-based lender to increase its direct capital investments in funds that provide capital to blacks, Hispanics, Latinos, Asians, Native Americans, along with other minority entrepreneurs and underrepresented women.
The bank adds the additional $ 150 million because it exceeded the target set last fall earlier than expected. In September, the bank stated it would invest $ 200 million in four years and overcame that in a matter of months.
The new funding is aimed at helping target companies establish and grow their businesses going forward. The additional money will allow the bank to expand its investments to more minority funds.
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In addition, the bank also noted that it has already done so pledged more than $ 250 million to 90 minority-focused investment funds in the U.S. Some companies that will benefit are Jumpstart, Elevate Capital, Avenue Growth Partners and Greenwood. Here is a list of others you get from funding.
The bank reports the action articulates the need for more capital in the funds managed by various administrators, as well as the need for more funding in growth equity for the minority entrepreneurs they support.
The bank has completed a total of 17 direct equity investments, including investments in additional institutions, minority deposit institutions and community development financial institution banks, as part of its $ 50 million commitment acquired in past.
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As part of this commitment, the bank states that it will acquire up to 4.9% of the net worth of MDI and CDFI banks, providing benefits to the communities that the institutions serve through loans, housing, neighborhood revitalization and other banking services. . Check out the list of where new investments were made here.
“Equity investments in minority-focused funds, MDI and CDFI banks are helping to bridge a persistent gap in access to growth capital,” Brian Moynihan, CEO of Bank of America, said in a press release. “By providing this capital, we are helping to balance the playing field and open more doors for companies led by minorities, entrepreneurs and innovation.”
The investments are part of Bank of America’s $ 1.25 billion racial equality and economic opportunity commitment. The pledge focuses on addressing and advancing social issues in minority populations, such as health, jobs, education, housing and capital inequality, and will facilitate benefits across diverse states and communities.
Bank of America joins other major U.S. banks that last year made significant financial commitments to fight racism following the police shooting of the George Floyd and Black Lives Matter protests.