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Community Investing Trends

Community Investment Institutions (CIIs) have stayed true to their original mission of community development. The services and financing they offer continue to focus on enterprise development, affordable housing, education, social services, and the economic advancement of women, minorities, and low-income individuals. CIIs have demonstrated a constant commitment to meeting the demand for improved investment vehicles with new community impacts. Presented below are new trends in community investing that model how CIIs are responding to their investor market while expanding their capacity to serve lower-income communities.

Asset Growth

Community investing experienced tremendous growth between 1995 to 2005. The community investing industry expanded nearly five-fold over this ten-year period. Assets held and invested locally by CIIs based in the U.S. totaled $19.6 billion, up from $4 billion in 1995. The figure below details the industry’s recent expansion for all CII types *.

Community Investing Asset Growth

CII Type

Current Assets 2005

Growth (1999-2005)

Community Development Banks

$10.1 billion


Community Development Credit Unions

$5.1 billion


Community Development Loan Funds (domestic and international)

$3.4 billion


Community Development Venture Capital Funds (domestic and international)

$870 million


Total Community Investing Assets

$19.6 billion


*Social Investment Forum, “2005 Report on Socially Responsible Investing Trends in the United States,” 2005.

More Achievers in “1% or More in Community Campaign”

The Social Investment Forum Foundation and Co-op America launched the “1% or More in Community Campaign” in 2001 to urge all institutional and professional investors to invest a minimum of 1% of their managed assets in community investment products. The overall goal of the Campaign was to help investors move more than $10 billion in net new assets into community investing by 2005. Since the Campaign started, Social Investment Forum Members have collectively added more than $1 billion in net new community investments, surpassing the Campaign's initial goal. Learn more about the 1% or More in Community Investing Campaign and our Community Investor Honor Roll.

Diversification and Specialization of Community Investing Products

Over the past ten years, an increase in assets and recognition has sparked demand for new community investing vehicles. CIIs have responded by fine-tuning original investing options into a variety of professional investing products such as pooled funds, regionalized products, and international funds. CIIs are increasingly able to work with institutional investors, pension funds, and educational and religious institutions by offering products tailored to their goals.

Commitment to Minority Populations

CIIs are finding new ways to bring formal-sector financial services to our diverse population. The growth of the Latino Credit Union Network over the past 10 years has brought more specialized and effective financial services to Latinos, the fastest-growing and highest “unbanked” immigrant population.1 Similarly, the number of Native American-owned CIIs operating on Native lands has risen from 1 in 1999 to 25 institutions in 2003.2 Native CIIs are able to provide their communities with much needed financial services while preserving Native culture.

Leading Institutions

Religious institutions are trailblazers in the community investing industry because they apply their mission statements to their investment policies. Educational institutions are following their lead in recognizing community investing as beneficial to their neighborhoods, students, workers, and community members. The Responsible Endowments Coalition, a network of students and alumni representing 22 universities with $56 billion in combined endowments, formed in 2004 to launch a campaign to institutionalize socially responsible and community investment at their universities.

Increased Federal Support

In 1994 the U.S. government created the CDFI Fund, a federal program to strengthen the industry and bolster CII capitalization. The Fund provides loans, equity investments, and grants to U.S. CIIs, financial incentives for traditional banks and thrifts that invest in CIIs, and tax incentives for private companies that make equity investments in low-income communities. Sustainable, large-scale governmental support is a new trend in the community investing industry. From the fund’s inception until 2003, it has granted more than $430 million in awards to CIIs.

New Environmental Lending

A growing number of CIIs are dedicated to funding environmentally sustainable community development initiatives. Forest preservation, clean water production, eco-tourism, responsible farming practices, and the recycling of discarded materials are among the environmental activities supported by community investing dollars. Use our Community Investment Database to search for environmental leaders by highlighting environment in the special interest section of the advanced search.

Community Development Venture Capital growing faster than traditional market

While total capital under management in traditional venture capital remained flat from 2001 to 2002, and only inched up slightly in 2003, CDVC funds’ capital under management has nearly doubled, climbing from $300 million at the end of 2000 to over $500 million at the end of 2003*. The majority of this growth has come from CDVC firms successfully raising money for second funds, adding about $98 million of new capital; and SBA-certified New Markets Venture Capital Companies are closing on an additional $115 million of capital. The number of CDVC organizations actively investing or in formation continues to grow.
*Social Investment Forum, “2003 Report on Socially Responsible Investing Trends in the United States,” 2003.

1 NATFED and Latino Credit Union Network
2“Investing in Community: Community Development Financial Institutions in Native Communities,” First Nations Oweesta Corporation



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