Ohio Banks Buck Trends, Invest Big in Affordable Housing
Ohio Capital Corporation for Housing reaps record investment
COLUMBUS, Ohio, Oct. 18, 2012
COLUMBUS, Ohio, Oct. 18, 2012 /PRNewswire/ --After the fallout in the
financial services market, who would believe that banks are investing heavily
in housing, especially affordable housing? But that's exactly what is
occurring in Ohio.
Ohio's banking industry set a record with the largest capital investment in
affordable housing development in a single year. Showing confidence in the
state's stabilizing economy, 15 banks invested $180 million in the 22^nd
equity fund syndicated by Ohio Capital Corporation for Housing (OCCH), the
nation's largest locally controlled capital fund dedicated to low-income
rental housing development. Six financial institutions took the plunge to
invest for the first time with OCCH.
The influx of new capital will help build 37 properties with more than 1,700
units of affordable housing.
2012 has turned out to be the best year for raising private capital, a sign
that banks are investing again. They are also turning profits. Of Ohio's 236
banks and thrifts, more than 66 percent reported earnings gains during the
last quarter, according to the trade association the Ohio Bankers League.
Housing projects financed by the Low Income Housing Tax Credit reduce
investors' federal tax liability on their profits dollar for dollar, so that
doing social good is also good for business.
Their investments are also a tribute to the strong management and reputation
of Ohio Capital Corporation for Housing. OCCH raised 32 percent more from
investors in 2012 than just one year ago.
"To build new partnerships with so many community banks is a reflection of
their commitment to underserved neighborhoods as well as our solid
management," said Hal Keller, president of Ohio Capital Corporation for
H. Stewart Fitz Gibbon III, president and chief operating officer of Wayne
Savings Community Bank, of Wooster, agrees. "We're investing in Ohio Capital
Corporation's expertise and track record of success. Ohio Capital Corporation
allows community banks like ours to combine and leverage our funds to meet the
needs of low-income families, the elderly and disabled residents in our
The banking industry's confidence is well placed. Despite the collapse of the
housing market, none of OCCH's 29,000 housing units has been lost to
Underscoring OCCH's strong performance, the U.S. Department of the Treasury in
August announced an award of $1.45 million to the company's subsidiary, Ohio
Capital Finance Corporation – the maximum amount granted by the government's
Community Development Financial Institutions Fund – which will be invested in
affordable housing in communities throughout Ohio.
Since 1989, OCCH has invested $2.5 billion in private corporate equity. This
investment has acted as a catalyst for neighborhood revitalization and boosted
Ohio's economy by stimulating $3.5 billion worth of construction.
The Low Income Housing Tax Credit program was created by Congress, is
administered by the Ohio Housing Finance Agency and implemented by private
enterprise. In Keller's view, "The tax credit program is the most successful
government housing assistance program. The private sector takes all the risks
and tenants pay the largest share of the costs. These public-private
partnerships are the only way to create affordable housing at a time when it
is so desperately needed."
Ohio, along with the rest of the nation, suffers from a severe affordable
housing shortage for low-income, working households. In order to afford the
rent for a two-bedroom apartment, a minimum wage earner must work 70 hours per
week, 52 weeks per year, according to the Coalition on Housing and
Homelessness in Ohio (COHHIO).
All Ohio Equity Fund XXII investors:
JPMorgan Capital Corporation, US Bancorp CDC, Key CDC, Northwestern Mutual
Life Insurance, Fifth Third CDC, BB & T, The Huntington CDC, FirstMerit Bank,
N.A., Park National Bank, First Federal of Lakewood, Westfield Bank, Wayne
Savings, Citizens Bank, Farmers Citizens Bank, and Waterford Bank.
About Ohio Capital Corporation for Housing (www.occh.org): Ohio Capital Ohio
Capital Corporation for Housing (OCCH) is the largest, locally controlled
syndicator of low-Income tax credits in the nation. Based in Columbus, OCCH is
a non-profit financial intermediary that provides developers of affordable
housing with access to capital markets. Since 1989, OCCH has raised $2.5
billion in equity investment, financed more than 29,000 units of affordable
housing, and assisted in the creation of more than 525 affordable housing
SOURCE Ohio Capital Corporation for Housing
Contact: Mary Kay Meager, Director of Operations & Communications,
+1-614-224-8446 x 148 (office), +1-614-778-8901 (cell)
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