Invest in BlueHub Loan Fund
Founded in 1985 by socially responsible investors, BlueHub Loan Fund is a certified community development financial institution (CDFI) which makes loans to support community development projects that build healthy communities. The Loan Fund also supports foreclosure prevention work, including our Stabilizing Urban Neighborhoods (SUN) Initiative, and our green initiatives. Your investment with the Loan Fund allows us to provide patient, flexible capital to our borrowers, making a difference in communities.
Since 1985, BlueHub Loan Fund has experienced loan losses of less than one half of one percent. All our investors have been repaid on time and in full.
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Through our Loan Fund, BlueHub Capital also offers financial institutions an equity equivalent (EQ2) product to assist in the capitalization of its affiliates.
Created by the Opportunity Finance Network, Citibank and the Comptroller of the Currency as a new form of equity for CDFIs, the EQ2 is highly subordinate, below market debt issued for an indeterminate term. EQ2s support CDFIs in two ways. First, the funds are available to be lent and invested in community development projects. Second, by their subordinated nature, EQ2s leverage additional senior debt from other investors. Banks that purchase EQ2s are allowed to receive CRA credit for a proportionate share of the CDFI’s entire lending activity that greatly enhances the CRA credit of the investment. In addition, banks may claim favorable accounting treatment for the EQ2. BlueHub Capital was the first local CDFI in the country to sell EQ2s and, through our Loan Fund we sell EQ2 to assist in the capitalization of the Loan Fund.
The terms of the equity equivalents created by BlueHub Capital meet the regulatory requirements for EQ2s. They are issued by our subsidiary BlueHub Loan Fund. The Loan Fund's purposes are to provide direct loans to community based projects and to capitalize affiliated community based financial intermediaries.
BlueHub Loan Fund equity equivalents have an interest rate of up to 3% paid annually with a ten year minimum initial term which is extended annually. EQ2s are subordinate to all other creditors of the Loan Fund, and the Loan Fund shall not be required to repay if any or all of such repayment should put it out of compliance with any senior creditors, including violation of permanent capital and liquidity requirements (or any such comparable requirements which may exist at the time of maturity.)
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