PNC Bank has invested $20 million in the Local Initiatives Support Corp. (LISC) to expand the organization’s work to boost economic opportunities in rural counties and 30 metro areas.
PNC Bank’s funding includes both a 10-year, $10 million Equity Equivalent (EQ2) investment as well as a more flexible $10 million three-year term loan. EQ2 is an innovative debt tool that offers nonprofit community development financial institutions like LISC the chance to raise capital with features that are similar to an equity investment.
“We continue to see that patient, flexible, and risk-tolerant EQ2 financing has become an increasingly important lever for community lenders to attract additional private capital into under-resourced communities,” said Rey Ocañas, managing director, PNC Community Development Banking. “With this 10-year commitment, PNC remains laser-focused on our efforts to strategically deploy low-cost capital into transformative initiatives that advance economic empowerment and prosperity where it’s needed the most.”
LISC, one of the country’s largest community development organizations, said it will use the capital to support a range of new and existing community investment efforts, such as small business programs for entrepreneurs without ready access to conventional financing, including those owned by women, people of color, and veterans. PNC Bank and LISC have collaborated on a number of significant investments in recent years spanning retail, health, education, and job training centers, as well as quality affordable housing and services.
“With this capital, PNC has made a remarkable commitment to the well-being of families and communities, with a ripple effect that will support economic growth long into the future,” said Michael Pugh, LISC CEO. “This is also a major investment in the infrastructure of community development,” he added, “helping us support our local partners as they scale up proven strategies for social, economic, and environmental impact.”
