Wednesday, June 8, 2022

Broadway Financial raises $150M through ECIP

Broadway Financial in Los Angeles has sold $150 million of preferred stock to the Treasury Department as part of the Emergency Capital Investment Program. 

The $1.1 billion-asset Broadway disclosed in a regulatory filing Wednesday that it sold 150,000 shares to the Treasury a day earlier for the cash investment. 

The investment will more than double the company's Tier 1 capital.

Broadway said it plans to use the net proceeds from the private placement to increase access to capital for small and minority-owned businesses, nonprofits and affordable housing in traditionally underserved markets. 

The Treasury set aside $9 billion to invest in Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) through the program. 

The capital will help institutions provide loans, grants and forbearance for small and minority businesses, as well as consumers in low-income and underserved communities.  

Broadway will be required to fulfill certain conditions established by the Treasury; it would also be subject to certain restrictions.

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