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
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.