California Community Reinvestment Corporation (CCRC), a leading Community Development Financial Institution (CDFI) focused on affordable housing, has announced a major expansion of its lending capacity through a $114 million securitization of tax-exempt loans and an additional $10.1 million in capital from existing bank partners. This milestone marks the first time a CDFI, rather than a bank or government entity, has completed a securitization of this kind in the public municipal market, according to a press release from the organization.
The securitization, structured in two tranches, drew strong demand from investors, with Wells Fargo serving as underwriter and U.S. Bank acting as trustee and custodian. Unlike most lenders that sell loans to Fannie Mae or Freddie Mac at closing, CCRC retained these loans on its balance sheet before bringing them to market—a structure used by only a handful of financial institutions since 2019. This approach requires significant operational capacity and a credit rating, capabilities that are rare among CDFIs nationally. By accessing the public markets, CCRC can recycle capital, lower its cost of funds, and expand affordable housing finance opportunities.
In conjunction with the securitization, several of CCRC's existing bank partners have increased their commitments. Beneficial State Bank raised its loan pool contribution from $12.5 million to $15 million, an increase of $2.5 million, and separately made a new $2.5 million commitment to CCRC's Tax-Exempt Loan (TEL) pool. State Bank of India (California) increased its contribution from $1.9 million to $3 million, an increase of $1.1 million. Bank of America returned to CCRC's loan pool with a new $2 million commitment. Wells Fargo provided a $2 million patient capital loan, designed to support shorter-term bridge lending that helps preserve affordable housing.
"Our bank partners are leaning in to show their continued commitment to CCRC with new investment dollars," said Tia Boatman Patterson, President and CEO of CCRC. "The securitization reflects years of work to build the infrastructure and track record needed to access the public markets. The increased commitments from our bank partners demonstrate the trust we've built with our investors and their continued commitment to financing affordable housing. Having the ability to recycle capital, lower our cost of funds, and continue expanding affordable housing finance opportunities is critical for our development sponsors and the California communities they serve."
The combined effect of these transactions strengthens CCRC's ability to fund permanent loans for affordable multifamily housing developments across the state, supporting working families, seniors, veterans, and individuals experiencing or at risk of homelessness. This development underscores the growing role of CDFIs in addressing the affordable housing crisis, potentially setting a precedent for other CDFIs to access capital markets.
