Community Development Financial Institutions Bond Guarantee Program

To support community development lending and investment by providing a source of long-term capital to certified Community Development Financial Institutions (CDFIs) for economic and community development in low-income communities and underserved rura

The CDFI BGP makes debt available to CDFIs from the Federal Financing Bank. The loans provide long-term capital to CDFIs, to provide new and substantial investment in distressed communities.

The Act defines Eligible CDFIs and authorizes the Community Development Financial Institutions Fund (CDFI Fund) to determine which entities may serve as Qualified Issuers.

Eligible CDFIs must use the Bond Proceeds for Eligible Community and Economic Development Purposes. This may include, but is not limited to, lending activities in low-income communities and underserved rural areas such as: owner-occupied home mortgages, charter schools, and municipal and community entity lending, among others.

Economic Development, Community Development (includes Federal surplus property) Through the CDFI Bond Guarantee Program, the U.S. Department of the Treasury will provide a 100 percent guarantee on the principal and interest of Bonds issued by Qualified Issuers. No guarantee amount may be less than $100,000,000, provided the total of all such guarantees in any one fiscal year may not exceed $500,000,000 (subject to appropriations). By legislative design, the CDFI Bond Guarantee Program is a zero-subsidy credit program. In accordance with Federal credit policy, the Federal Financing Bank will purchase Bonds issued by Qualified Issuers. The maximum maturity of the bonds is 29.5 years. Qualified Issuers as "pass-through" entities (not as obligors) will lend the Bond proceeds to Eligible CDFIs. The loans to Eligible CDFIs must be used for Eligible Community or Economic Development Purposes. Bond and Bond Loan rates and terms will vary.

The CDFI Bond Guarantee Program is subject to annual Congressional authorization and appropriation. Guaranteed Bonds may have terms up to 29.5 years.

The application review and evaluation process is merit-based and based on established standard operating procedures, which may include interviews and/or site visits.

The CDFI Fund reviews applications and authorizes the provision of Guarantees based on an established merit-based review process set forth in the CDFI Bond Guarantee Program regulations, NOGA, and application materials.