UMB Bank is initial investor in community development fund

Kansas City-based UMB Bank is one of 10 financial institutions nationwide to invest in a fund to help foster community development, according to a news release.

Based out of Miami and trading on the Nasdaq under the ticker symbol CDCDX, the Community Development Fund was launched in April with $25 million in capital.

Under the umbrella of the Community Reinvestment Act of 1977, the fund is a market-rate bond fund that invests mainly in government-guaranteed, fixed-income securities whose proceeds are designed to affect community development, including housing projects, the release said.

“These first investors should be commended by being responsive to community development needs in their local neighborhoods, where the funds will be targeted for maximum impact,” Ken Thomas, the fund’s president, said in the release. “We welcome more community-minded banks to join the fund’s continuing community development mission.”

In an e-mail, Thomas said he hopes that other banks in Kansas become investors. He added that areas in Wichita could be affected by the fund in the future, though he said the Kansas City area would likely benefit, at least initially, from UMB’s investment because the bank is based there.

The fund has a $1 million minimum investment and is available only to federally insured financial institutions. UMB Bank has more than 100 branches in eight states, including two in Wichita.

This story was originally published June 28, 2016 at 2:16 PM with the headline "UMB Bank is initial investor in community development fund."