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On Citigroup's Impact Investment Fund. Comments by Jalil Boulahssas, Impact Investing Intern, University of Richmond

Citigroup, in continuing its efforts to focus on impact investments and societal issues, has launched a $150 million venture capital fund with a specific focus . This fund, issuing up to $10 million to qualified companies, looks to uplift firms run by women and minorities as well as firms assisting their employees in societal challenges such as training, housing, and overall personal development. William Michael Cunningham, the CEO of Creative Investment Research, highlights the fact that big banks have not effectively invested in black-owned businesses. However, a growing number of impact investment funds offering equity capital could have a significant effect on the sector. According to Citi’s head of global public affairs, Ed Skyler, this fund falls in line with several of Citi’s “Pathway to Progress” initiatives in promoting impact investment and financial inclusion. As the only bank to use its own balance sheet in a fund of this nature, it has already begun working with its o

Citi tries new tack to push its social agenda: Venture investing. American Banker Newspaper. By John Reosti February 10, 2020, 4:09 p.m. EST

Citigroup operates a big foundation that focuses on philanthropic priorities such as workforce development, financial inclusion and sustainability. Now, the banking giant is building on these commitments by launching a venture capital fund that will invest in private-sector firms that are developing solutions to improve worker training, increase consumers' access to the financial system, improve access to transportation, health care and affordable housing, and address issues related to sustainable energy and water use. Citi is calling the impact fund the largest ever involving a bank using its own capital. Investments could be as large as $10 million in more established companies, said Ed Skyler, Citi's vice president for global public affairs. Citi is also setting a portion aside for earlier-stage seed investments. Seed funding will be allocated exclusively to investments in businesses led or owned by women and minorities. The bank plans to manage the fund largely in-

Citi's Impact Fund. Comments by Nathan Pratt, Impact Investing Intern, University of Maryland.

With the record levels of profits banks have made in 2019, Citigroup is responding by allocating a portion of this money for investments in companies with positive social impact. Citi announced they are starting a $150 million Citi Impact Fund , which will also help fund minority and women owned businesses. Businesses of this nature represent great potential economic growth for a number of reasons. First, minority and women owned businesses are underrepresented in overall business activity due to structural flaws in the banking system. I believe there is great demand for them. Given the reality that lack of access to credit is one of the biggest hurdles these entrepreneurs face, the Citi Impact Fund could help address this issue. Furthermore, investing in businesses that promote positive social impacts would likely be beneficial to the average citizen, considering these firms attempt to help provide better infrastructure, access to information, and sustainability. In conclusi

Review of "Income Inequality, Record Bank Profits and the Citigroup Impact Investing Fund" by Minwoo Kim, Impact Investing Intern, American University.

These days, it seems that sustainable investing is a global trend. In this context, Citigroup seems to want to join the trend of the times through impact funding. I think it is important to decide which business to invest in using criteria related to the positive impact on society such an investment may have. The question seems to be whether to place the selection and evaluation standards totally on the potential to succeed financially or on equality related factors such as status of the business owners as minority or women. From a purely economic point of view, it would seem to be much better to put full importance on the potential to succeed financially. But we should also take the global trend toward consideration of equality and sustainable growth into account. Though Citigroup plans to invest in minority and women-owned businesses, one concern is how can those business keep growing and move forward to the mid-long term. I think a good solution to this concern is to utili

Citi's Impact Fund. Comments by Jalil Boulahssas, Impact Investing Intern, University of Richmond

As Citigroup establishes its $150 million  Impact Fund , it takes aim at the issue of funding minority-owned businesses. A fund like this one should look to create a successful equity financing vehicle in a sector with few sources of financial support. Banks have extended less credit to small firms than they did prior to the Great Recession. According to a Richmond Federal Reserve study, 51% of black-owned small businesses experienced challenges in the availability of credit, compared to 30% of white-owned small businesses. (1) This trend is also seen in the size of loans received. A smaller share of black, hispanic, and female-owned businesses tend to receive loans over $100,000 and they are also more likely to use owner loans than white and white-male owned businesses. (2) This points to the larger trend that, while black-owned businesses are the most likely to apply for bank financing, they are the least likely to receive full funding, with only 31% receiving the whole amo

Hope or Hype? Citigroup's New Impact Fund

Banking giant Citigroup recently announced the launch of the  $150 million Citi Impact Fund . (We have long been concerned with Citi, having filed an October 1998 petition in the US Court of Appeals for the DC Circuit (Case Number 98-1459) concerning the merger that created the bank. In our appeal, we noted that our economic models showed evidence that growing financial market malfeasance greatly exacerbated risks in financial markets, and that this would lead to a financial downturn.) Citi now claims it “will make equity investments in ‘double bottom line’ private sector companies that have a positive impact on society.” These investments in U.S.-based companies (not individuals) will be made using the bank’s own capital. Citi states that it is looking for innovative companies in workforce development, financial capability, physical and social infrastructure and sustainability. Citi has committed to providing seed funding for businesses that are led or owned by women and minor

June 18, 1998 opposition to the Citibank/Traveler's merger

On July 25, 2012, Sandford I Weill, former Charman of Citigroup, said it’s time to break up the largest banks to avoid more bailouts.  Mr. Weill, you'll recall, spearheaded the Citibank/Travelers, sparking the creation of super large financial institutions and creating the "too big to fail" dilemma. Mr. Weill accomplished this by getting policymakers to first ignore and then repeal the Glass-Steagall Act, a Depression era law designed to separate commercial from investment banks. In an interview on CNBC, Mr. Weill stated that “ 'What we should probably do is go and split up investment banking from banking'..Have banks do something that’s not going to risk the taxpayer dollars, that’s not going to be too big to fail.' ” No kidding. Thank you, Mr. Weill. I suppose 5,151 days late is better than never at all. An article about this matter on Bloomberg.com quoted  Thomas Hoenig , a Federal Deposit Insurance Corp. board member and former head of the Kansa

"Friend of the Court" brief in SEC vs. Citigroup (2nd Cir Ct of Ap)

William Michael Cunningham submitted a "Friend of the Court" brief in a case currently pending before the United States Court of Appeals for the Second Circuit. The case concerns the rejection, by a Federal Judge, of a settlement agreed to by the United States Securities & Exchange Commission (SEC) and Citigroup Global Markets Inc. (Citigroup), the latter accused of securities fraud. As a friend to the Court, Mr. Cunningham seeks to provide an independent, objective and unbiased view in support of broad public interests. His education and experience have uniquely positioned him to provide objective, independent research and opinions concerning the issues central to the case. The "Friend of the Court" brief concludes by noting that markets have become less stable. Faulty regulatory practices and collusion (too big to fail, etc.) have moved regulators and lawmakers..in the direction of supporting suppliers to the financial service marketplace. A decision by the

ShoreBank's Rescue Gives Community Lenders Hope

Summary version from The American Banker Newspaper. Wednesday, May 19, 2010. Story by Robert Barba. Sources said early Tuesday that the struggling $2.3 billion-asset lender had secured $140 million in capital commitments, well exceeding the $125 million it needed to become eligible for a $75 million investment from the Treasury Department. Though most of the companies on the roster have been solid supporters of community development financial institutions, Goldman Sachs Group Inc. and General Electric Co.'s GE Capital were two newcomers. They also were among the biggest investors in the group, kicking in $25 million and $20 million, respectively. Another headline investor in ShoreBank is Citigroup Inc., at $20 million. Others include Bank of America Corp., JPMorgan Chase & Co., Wells Fargo & Co., U.S. Bancorp, Morgan Stanley, Northern Trust Corp. and PNC Financial Services Group Inc. Also on board were State Farm, the Ford Foundation and the John D. and Catherine T. Mac

Summary of House Committee on Financial Services Hearing (Tian Weng, Debby Su)

1. Topic: TARP Accountability: Use of Federal Assistance by the First TARP Recipients 2. Date and Time: Feb 11, 2009, 10:00 am – 1:00 pm 3. Place: 2128 and 2172 Rayburn House Office Building 4. Chairman: Mr. Barney Frank, Chairman of the House Financial Services Committee 5. Witness List: Mr. Lloyd C. Blankfein, Chief Executive Officer and Chairman, Goldman Sachs and Co. Mr. James Dimon, Chief Executive Officer, JPMorgan Chase and Co. Mr. Robert P. Kelly, Chairman and Chief Executive Officer, Bank of New York Mellon Mr. Ken Lewis, Chairman and Chief Executive Officer, Bank of America Mr. Ronald E. Logue, Chairman and Chief Executive Officer, State Street Corporation Mr. John J. Mack, Chairman and Chief Executive Officer, Morgan Stanley Mr. Vikram Pandit, Chief Executive Officer, Citigroup Mr. John Stumpf, President and Chief Executive Officer, Wells Fargo and Co. Eight bank CEOs from companies receiving the first TARP funds testified before the House Financial Services Committ