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Restored unit funded by FRB in Yuba
New Rates in Unprecedented Times
October 01, 2022
While the Federal Reserve has been raising interest rates quickly, that hasn’t been the case for most impact investments. That’s because impact portfolios are largely uncorrelated to public market benchmarks and often unable to keep up with rapidly rising borrowing costs. This is most clearly the case in community development and social justice-focused sectors that are serving lower-income people.
At Calvert Impact Capital, we see this rate constraint in many parts of our portfolio but given our broad reach in financing social and environmental solutions in communities globally, we are now seeing some of our portfolio partners marginally increasing rates on the loans they originate. As such, we’re able to increase rates on our Community Investment Notes® today.
This does not change the rates of any existing Notes, only new Notes opened on or after October 1, 2022.
Our rates are determined by the financing needs of our portfolio partners and not the broader market forces that make headlines. Our investors know that we have not changed rates often – increasing rates a single time in 2016 and in 2018, then lowering once in 2020 and in 2021, and in 2022 raising in May and again today. We always base our rates on the portfolio pricing demand we see going forward in the impact sectors and communities we serve.
Overall, we strive for consistency with the Community Investment Note® – a product that has paid investors 100% of their principal and interest payments on over $2.5 billion invested, while consistently creating measurable impact for 27 years. Thanks to our investors for continuing their support in meeting the needs of communities.
*Past performance is no guarantee of future results. As with all investments, there is risk. Please read our prospectus before investing.
