Ponce Financial Group in Bronx, N.Y., has received $225 million in Tier 1 capital through the Emergency Capital Investment Program (ECIP).
The $1.7 billion-asset Ponce said in a press release Thursday that it sold 225,000 shares of preferred stock to the Treasury Department.
“This large investment … will be transformative not only for Ponce,” Carlos Naudon, the company’s president and CEO, said in the release.
The funds “will allow us to have a massive impact in our communities – communities of color, immigrants and of limited means that were so adversely affected by the pandemic and their still unresolved wealth and health gaps,” Naudon added.
The investment comes on the heels of Ponce recording a large writeoff after fraud and credit issues arose in its partnership with fintech startup Grain Technologies.
The Treasury set aside $8.7 billion to invest in Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) through the program.
The capital will help institutions provide loans, grants and forbearance for small and minority businesses, as well as consumers in low-income and underserved communities.
Other banks that have received ECIP funds include Broadway Financial, BancPlus and Security Federal.