Farmers & Merchants Bank of Long Beach Commits $2 Million Investment in Clearinghouse CDFI
Farmers & Merchants Bank of Long Beach (F&M Bank) has announced a significant $2 million capital investment in Clearinghouse Community Development Financial Institution (Clearinghouse CDFI), reinforcing its commitment to supporting low- to moderate-income communities. This investment is part of an ongoing recapitalization campaign initiated by Clearinghouse CDFI in late 2024. With this contribution, F&M Bank joins a historic capital raise, the largest in Clearinghouse CDFI’s history.
Douglas J. Bystry, President and CEO of Clearinghouse CDFI, expressed his enthusiasm about F&M Bank’s participation in this landmark initiative. “We are pleased to have F&M Bank join us in the single largest capital raise in Clearinghouse CDFI’s history. This investment will enable us to increase our lending to support vulnerable communities nationwide.”
The Mission of Clearinghouse CDFI
Clearinghouse CDFI was founded in 1996 with the goal of providing economic opportunities and improving the quality of life for lower-income individuals and communities. It achieves this through innovative and affordable financing solutions that are not typically available through conventional lending markets.
Since its inception, Clearinghouse CDFI has funded an impressive $2.7 billion in total loans, which have been utilized to support 2,732 community projects. These initiatives have played a critical role in job creation and retention, generating more than 43,856 jobs and benefiting over 5.1 million individuals. Additionally, Clearinghouse CDFI has facilitated the development of 13,548 affordable housing units, furthering its commitment to enhancing living conditions for those in need.
F&M Bank’s Commitment to Community Development
F&M Bank has demonstrated a longstanding commitment to community development and economic growth. The bank’s decision to invest in Clearinghouse CDFI aligns with its dedication to serving underserved communities. W. Henry Walker, CEO of F&M Bank, highlighted the significance of this collaboration:
“F&M Bank has worked with Clearinghouse CDFI for nearly 30 years due to our shared commitment to giving back to the communities we serve. We have confidence in the ability of their leadership to leverage our investment for the greatest impact.”
This investment is just one of many ways F&M Bank has sought to support communities in need. Over the years, the bank has actively engaged in numerous community-driven initiatives, reinforcing its role as a financial institution that prioritizes social impact alongside profitability.
The Role of Community Development Financial Institutions (CDFIs)
Community Development Financial Institutions (CDFIs) are specialized organizations that provide financial services to underserved markets and populations. These institutions play a crucial role in bridging economic gaps by offering loans, investments, and financial assistance to businesses, nonprofit organizations, and individuals who may not qualify for traditional banking services.
Clearinghouse CDFI is one such institution that has been instrumental in driving economic growth and stability in low-income areas. By offering financing for affordable housing, small businesses, and community facilities, Clearinghouse CDFI helps create sustainable development opportunities that would otherwise be inaccessible to many communities.
Impact of F&M Bank’s Investment
F&M Bank’s $2 million investment in Clearinghouse CDFI is expected to have far-reaching effects, enabling the institution to expand its lending capacity and increase its reach to underserved populations. Some of the key areas where this investment will make a difference include:
- Affordable Housing Development: With the increasing demand for affordable housing, Clearinghouse CDFI will be able to fund more housing projects, helping to alleviate the housing crisis in various communities.
- Small Business Support: Many small businesses struggle to obtain financing from traditional banks. With additional funding, Clearinghouse CDFI can provide more loans to small business owners, fostering economic growth and job creation.
- Community Infrastructure Improvements: Investments in community facilities such as healthcare centers, schools, and social service agencies contribute to overall community well-being. This investment will support such projects, improving access to essential services.
- Job Creation and Retention: By financing businesses and community initiatives, Clearinghouse CDFI helps create and retain jobs, boosting economic stability in the areas it serves.
F&M Bank’s Track Record in Community Investment
F&M Bank has a strong history of investing in community development projects. In 2023, the bank received an “Outstanding” rating from its 2022 Community Reinvestment Act (CRA) examination. This recognition underscores the bank’s commitment to supporting traditionally underserved communities and ensuring that its financial services reach those who need them most.
The CRA was enacted in 1977 to encourage financial institutions to meet the credit needs of all communities, particularly low- and moderate-income areas. Banks that excel in community reinvestment are recognized for their efforts, and F&M Bank’s outstanding rating is a testament to its dedication to financial inclusivity.
The Future of Community Investment
The partnership between F&M Bank and Clearinghouse CDFI exemplifies how financial institutions can play a pivotal role in addressing economic disparities. By investing in CDFIs, banks can help drive positive change, ensuring that capital is directed toward projects that foster sustainable development and economic empowerment.
Looking ahead, both F&M Bank and Clearinghouse CDFI are likely to continue expanding their efforts in community development. With ongoing support from investors and stakeholders, Clearinghouse CDFI can further its mission of providing innovative financing solutions to those who need them most.
Additionally, this investment sets a precedent for other financial institutions to follow. As economic inequality continues to be a pressing issue, more banks may consider partnering with CDFIs to contribute to community revitalization and economic inclusion.
