Chicago Bank Foreclosures Prevention Funds Awarded by CDFI

by Simon Lindsay on cities

The Community Development Financial Institutions (CDFI) Fund of the U.S. Department of Treasury has awarded $576,000 grant to ShoreBank as part of its effort to prevent bank foreclosures in Chicago.

ShoreBank has been serving Chicago, Illinois’ neighborhoods severely affected by the economic and foreclosure crisis. The bank is among the 55 depository Federal Deposit Insurance Corp.-insured financial companies from across the county and Northeast Illinois that have been recognized under the Bank Enterprise Award (BEA) Program.

The award recipients are being recognized for their responsible mortgages, quality financial services provided to economically distressed communities last year and offering affordable credit.

The grant money will be used by ShoreBank to boost its loan provisions and to continue to provide loans to community development financial groups in Chicago. The low-cost financing greatly help small business owners and neighborhood developers who may have difficulty obtaining loans at market rate.

ShoreBank provided ACCION Chicago a loan amounting to $100,000. The community development financial institution provides business and credit services to help small businesses in low and moderate income communities that have no access to traditional financing sources.

On its part, ACCION Chicago provided a $12,000 loan to businessman Anthony Waller. The Catering Out of the Box owner used the loan to expand his small business which now employs a dozen employees.

ShoreBank executive vice president Fran Grossman said that the award will augment ShoreBank’s lending services for community development financial institutions. The award also helps CDFI partners in developing economic opportunities to prevent Chicago bank foreclosures, grow sustainable businesses and create good jobs, Grossman added.

ACCION Chicago’s vice president of resource development Mary Fran Riley said that the CDFI funds will provide much needed relief from increasing demands for investment capital and loans that have been difficult to shore up or disappeared in many neighborhoods across Illinois.

She added that financial institutions like ShoreBank have provided access to more low-cost financing which allowed the organization to support existing and new businesses and create job opportunities.

The CDFI’s BEA Program was launched to provide incentives to financial institutions to increase their support to community development financial institutions, loan provisions and financial and investment services in economically distressed neighborhoods.