Market Overview

Morgan Stanley, LISC Launch Pilot Small-Business Loan Fund to Fuel Growth, Create Jobs in Low-Income Communities

NEW YORK--(BUSINESS WIRE)--

Morgan Stanley (NYSE: MS) and the Local Initiatives Support Corporation (LISC) together have launched a Small Business Loan Fund to support commercial expansion and create jobs in communities battling economic decline.

“Small businesses too often lack sufficient capital to build and grow,” said Audrey Choi, Managing Director and Head of Global Sustainable Finance at Morgan Stanley. “This fund will provide financing for small businesses seeking to acquire the resources they need to expand, and therefore contribute to the economic development of the communities in which they operate.”

Morgan Stanley is providing $10 million in debt financing and equity capital to help launch the Small Business Loan Fund, while LISC is allocating its federal New Markets Tax Credits (NMTC) to the fund. NMTC is a tax credit program administered by the U.S. Department of the Treasury to bring private investment dollars to low-income neighborhoods.

Over the next year, the fund expects to support businesses within some of the 31 urban areas where LISC is already working to revitalize distressed neighborhoods, including parts of Chicago, Detroit, Indianapolis, Los Angeles, Milwaukee, New York City, Phoenix, San Diego and the San Francisco Bay area. It will also seek to support rural communities where LISC operates. The fund will make qualifying loans under the Small Business Administration 504 program, which allows businesses to buy, build or expand facilities and purchase equipment. LISC and Morgan Stanley are partnering with CDC Capital Markets, a leader in the SBA 504 market, to source and manage loans for the fund. The fund could be expanded in the future to reach more businesses in more communities.

“Even the most successful small businesses in many of these neighborhoods have a tough time accessing the capital they need to grow,” said Kevin Boes, President of New Markets Support Company (NMSC), a LISC affiliate that manages New Markets Tax Credit investments. “With this fund, we can offer a loan product at reasonable rates, so small businesses can maximize their cash flow and build their business, despite tight credit markets.”

Ken Rosenthal, Senior Advisor of lending, education and training for CDC Capital Markets, said, “With this type of financing, a business can purchase its own building, secure its financial future and create new jobs to help the surrounding community and economy. We are excited to partner with Morgan Stanley and LISC and to be in a position to offer the small-business community access to capital at favorable rates and terms.”

For more information about fund investments or to make an inquiry about a particular need, please contact Ken Rosenthal at CDC Capital Markets, 858-967-7817 or krosenthal@cdcloans.com.

About Morgan Stanley
Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management services and wealth management services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,200 offices in 43 countries. Since 2006, Morgan Stanley has executed more than $5 billion in investments to strengthen underserved communities. For more information about Morgan Stanley, please visit www.morganstanley.com.

About LISC
LISC combines corporate, government and philanthropic resources to help nonprofit community development corporations revitalize distressed neighborhoods. Since 1980, LISC has raised $12 billion to build or rehab 289,000 affordable homes and develop 46 million square feet of retail, community and educational space nationwide. Toward that end, the Treasury Department has awarded LISC $778 million in New Markets Tax Credit investment authority, the largest allocation in the country. All told, LISC support has leveraged nearly $40 billion in total development activity. For more information, visit www.lisc.org.

About CDC
CDC Capital Markets is a division of CDC Small Business Finance, which leads the nation in providing SBA-504 loans to small businesses as well as access to other capital through distinctive, innovative financing products and services. In addition, CDC reinvests in communities, particularly underserved markets and populations. In all, CDC Small Business Finance has provided financing to more than 3,000 small businesses, resulting in the creation and retention of over 100,000 jobs. For more, visit www.cdccapitalmarkets.com.

Media:
LISC New Markets Support Company
Kevin Boes, 312-697-6467
kboes@nefinc.org
or
Morgan Stanley
Sandra Noonan, 212-761-2446
sandra.noonan@morganstanley.com
or
CDC Capital Markets
Ken Rosenthal, 858-967-7817
krosenthal@cdcloans.com

 

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