Progreso Financiero Secures $25 Million Credit Facility from Bank of America and Silicon Valley Bank to Fuel Growth
Bank of America and Silicon Valley Bank partner with Progreso Financiero to Address Financial Needs of Underserved Hispanics
MOUNTAIN VIEW, CA – (Sept. 7, 2011) -– Progreso Financiero, a financial institution dedicated to the economic advancement of lower-income Hispanics, announced today that it has secured $25 million in debt financing from Bank of America, one of the world’s largest financial institutions, and Silicon Valley Bank (SVB), a banking partner to 50 percent of the venture capital-backed technology and life science companies in the United States.
This overall $25 million in lending capacity from two premier lending institutions will enable Progreso Financiero to provide even more Hispanic families with fair and responsible loans that help them establish credit and move up the economic ladder. The partnership also serves as an example of how major financial institutions can partner with innovative, community-oriented institutions like Progreso Financiero to meet the needs of the underserved and fast-growing Hispanic community.
In November 2009, Progreso Financiero was certified by the U.S. Department of Treasury as a Community Development Financial Institution (CDFI) for its service in lower-income communities. Through its growing impact as a CDFI, Progreso offers a compelling way for major financial institutions to help advance the mission of economic development in lower-income communities. Since its founding in 2005, Progreso has made 175,000 loans to qualified applicants, of which 70,000 were made in 2010. With this rapid growth, Progreso is actively seeking additional partners like Bank of America and SVB to help the company achieve its goal of serving more than 1 million credit-worthy clients and lending more than $1 billion to the Hispanic community.
“As we continue to grow, these credit facilities provide the capital we need to deliver financial opportunities to many more hard-working, underserved Hispanics,” said James Gutierrez, founder and CEO of Progreso Financiero. “Our proven, community-oriented platform enables large financial institutions to engage with this demographic in a trusted and transparent manner and help bring lower-income and underserved families into the financial mainstream. We are excited to partner with Silicon Valley Bank, the number one lender to emerging companies, and Bank of America, whose immigrant founder began with a similar vision of lending to working class people more than a hundred years ago.”
“Progreso Financiero represents a new, innovative wave in CDFI finance in this country – a scalable approach that can dramatically expand access to credit in underserved communities, where too often the only financing options are high-priced payday lenders and check cashing stores,” said Dan Letendre, CDFI Lending & Investing Executive of Bank of America. “We are proud to work with partner Silicon Valley Bank to support Progreso and their work in delivering responsible, credit-building products and services at reasonable rates to qualified applicants.”
“We aim to help innovative companies grow,” said Mike Selfridge, head of regional banking for Silicon Valley Bank. “We are proud to support Progreso Financiero’s continued expansion and its community development initiatives.”
“More than 23 million Hispanics in the United States are unbanked or underbanked,” continued Gutierrez. “With limited-to-no credit history, they have virtually no opportunity to access mainstream credit products from larger banks, but Progreso Financiero fills this gap in the financial system by providing them with access to responsible small dollar loans and the ability to build a credit history. We also aim to evolve along with our customers over the course of their lives and across generations to offer a range of services that address financial security, asset building and next stage credit.”
The typical Progreso Financiero borrower begins with no credit history, yet after three successful small loans that each average approximately $1,000 for 10 months, they can build to a credit score of 660. This allows them to qualify for more traditional products offered by larger lenders and financial institutions. Since its founding in 2005, Progreso Financiero has made more than 175,000 loans, extending $175 million in capital to underserved Hispanic families and expanding to more than 65 locations across California and Texas.
More information about Progreso Financiero and its empowering financial services are available at the Progreso Financiero website.
About Bank of America
Bank of America is one of the world's largest financial institutions, serving individual consumers, small-and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 58 million consumer and small business relationships with approximately 5,700 retail banking offices and approximately 17,800 ATMs and award-winning online banking with 30 million active users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange.
About Silicon Valley Bank
Silicon Valley Bank is the premier commercial bank for companies in the technology, life science, venture capital, private equity and premium wine industries. SVB provides a comprehensive suite of financing solutions, treasury management, corporate investment and international banking services to its clients worldwide. Through its focus on specialized markets and extensive knowledge of the people and business issues driving them, Silicon Valley Bank provides a level of service and partnership that measurably impacts its clients’ success. Founded in 1983 and headquartered in Santa Clara, Calif., the company serves clients around the world through 26 U.S. offices and seven international operations. Silicon Valley Bank is a member of global financial services firm SVB Financial Group (Nasdaq: SIVB). www.svb.com
About Progreso Financiero
Progreso Financiero is a financial institution dedicated to the economic empowerment of the lower-income Hispanic community. Progreso aims to be the banking partner of choice for the 23 million Hispanics in the US who are underserved and need access to empowering financial products and services. Unlike mainstream institutions, Progreso provides loans without collateral to clients who lack credit history with its sophisticated risk scoring system that emphasizes a client’s true capacity to afford a loan. Progreso Financiero engages with customers in their neighborhoods, in their language, and with familiar faces from the community in order to build relationships of trust that lead to a lifetime of growth and prosperity. Progreso Financiero is a for-profit institution that believes in the moral collateral of its clients and is committed to providing opportunities to help its clients achieve their dreams. Since its founding in 2005, the company has made more than 175,000 loans, extending $175 million in capital to underserved Hispanic families through more than 65 locations across California and Texas and helping improve credit scores for over 87 percent of its loan customers. For more information, please visit: www.progressfin.com.
For Progreso Financiero