Helping advisers and their clients create impact
When individuals or institutions hold deposits at a bank, the money doesn’t have to remain stagnant. “We see the potential for cash deposits to be a catalyst for impact,” says Eli Dalven, Impact Investing Associate at Loring, Wolcott & Coolidge (LWC), a trust office based in the heart of Boston.
As a fiduciary, LWC has made a unique commitment to sustainable investing and community development, as one of the first trust offices to offer clients the opportunity to support people and the planet with their investment dollars. LWC’s innovative Sustainability Group, founded by Amy Domini in 1987, is one of the largest private client asset managers of community development investments, extending roughly $60 million on behalf of its clients to Community Development Financial Institutions (CDFIs) nationwide, including community banks, credit unions, and loan funds. Virginia Community Capital has long been a CDFI partner of LWC, both as a bank, taking insured deposits, and as a CDFI loan fund, issuing promissory notes. With partnerships at nearly 80 other community development organizations, LWC helps its clients design direct impact portfolios tailored to their values and investment goals.
“By offering our clients the ability to place a portion of their fixed-income allocation in a number of high-impact depository institutions like triple-bottom-line community development banks and credit unions, we assist them in supporting economically vulnerable populations,” Dalven says. “This is one of a few ways that our clients can act as a source of patient capital, enabling CDFIs to leverage their initial investment, multiplying its impact over many years, or as is often the case, decades.”
For example, social investments made to VCC are then leveraged to finance community facilities such as health centers, primary care clinics, and afterschool spaces that traditional banks tend to overlook, and other projects that expand fresh produce availability in neighborhoods facing ‘food deserts’, develop permanently affordable housing, or generate renewable power for marginalized, low-income communities.
“We’re thrilled that VCC can direct this capital to areas that our clients care deeply about—and address issues that impact us all, like the need for living wages, truly affordable housing, and thriving ecosystems—to create healthy, resilient communities,” says Dalven.
Over time, LWC clients have invested over $3 million in VCC deposits and an additional $655,000 in the CDFI’s Local Impact Opportunity Notes. VCC’s LIONs provide a financial and social return by funding impactful community projects across Virginia. VCC also provides LWC with enhanced deposit reporting to assist with their fiduciary requirements over investment funds, in coordination with the client’s custodian and primary bank.
“LWC understands individuals and organizations are looking for more than just a place to grow wealth, but to use their money to create impact for others and support communities,” says Teresa Martin, Vice President and Mission Deposit Manager at Virginia Community Capital. “Community Development Financial Institutions such as VCC help advisers match mission-investing goals to each client’s needs, priorities and aspirations, and we are proud to partner with LWC to accomplish that.”