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December 14, 2011
Community Capital Management's Flagship Fund Surpasses $1 Billion in Assets
    by Robert Kropp

The Community Reinvestment Act (CRA) Qualified Investment CRA Shares fund, which helps banks meet the credit needs of the communities in which they operate, now has over 300 bank shareowners.


Community Capital Management, a Florida-based provider of fixed income investment services since 1998, announced this week that its flagship mutual fund has surpassed $1 billion in assets.

Launched in 1999, the Community Reinvestment Act (CRA) Qualified Investment CRA Shares was designed to provide banks with opportunities to extend credit and capital to low- and moderate-income communities in which they have operations.

The Community Reinvestment Act (CRA), enacted by Congress in 1977, requires that banks help meet the credit needs of the communities in which they operate, and provides for periodic evaluations of their performance. According to Community Capital Management, 675 evaluations of the banks that invest in its fund have been undertaken, and in every case the bank has earned positive consideration.

At present, the fund has more than 300 bank shareowners, ranging in size from small community banks to large financial institutions. The Fund invests primarily in government-related subsectors of the bond market that support community development, such as agency-backed securities and taxable municipal bonds, Community Capital Management states.

In a white paper published in September, Community Capital Management described municipal bonds, which are issued by state and local governments, as often supporting "sustainable initiatives such as energy efficiency, renewable energy, and other vital environmental programs."

Government-related securities, issued by agencies such as the Department of Housing and Urban Development (HUD) and the Small Business Administration (SBA), support such sustainable practices as brownfields cleanup, energy efficiency, and the siting of new small businesses in underserved communities.

Over the past ten years, Community Capital Management reports, the 30-day SEC Yield of its fund has outperformed the yield on the 5-year Treasury note by 0.68%. The fund's annualized total returns for the one-year, five-year, and ten-year periods were 5.28%, 5.01%, and 4.73%.

"The Fund allows banks the opportunity to invest in a vehicle that targets community development capital to their local markets," said Barbara VanScoy, senior portfolio manager at Community Capital Management.

In 2007, the firm responded to widespread interest from institutional investors in community development fixed-income investment products by introducing the CRA Qualified Investment Fund Institutional Shares mutual fund. The firm also has a Retail Shares investment fund for individual investors.

Sustainable fixed income investment products such as those offered by Community Capital Management allow investors to integrate environmental, social, and corporate governance (ESG) criteria into their decision-making, while providing both moderate returns and low volatility when compared to other asset classes.

According to the firm's white paper, the current market estimate for fixed income investment is $3.5 billion to $5 billion, and is expected to grow.

 

 
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