Charter One Bank announces $250 million affordable housing initiative in Michigan
Charter One Housing Bank to fund affordable housing units in metropolitan DetroitDetroit (May 23, 2006) - Charter One Bank today announced it is launching the Charter One Housing Bank, an innovative community development initiative designed to increase the availability of affordable housing in metropolitan Detroit and throughout the Midwest region.
The Charter One Housing Bank will provide $250 million in low-interest loans to non-profit housing developers seeking to create affordable housing.
"The Charter One Housing Bank was launched to address the region’s affordable housing needs,” said Sandra E. Pierce, President and CEO of Charter One Bank, Michigan. "We are determined to provide the tools necessary to bridge financing gaps of local developers looking to provide affordable housing in the communities we serve."
According to the U.S. Census Bureau 2004 American Community Survey, 29.4 percent of Michigan households pay more than 30 percent of their income in gross rent, shouldering the “cost burden.”
“Affordable housing is a need in every large city, Detroit is no exception. The availability of affordable housing is one of the most important factors that will help our city as it continues to grow in the Next Detroit,” said Mayor Kwame M. Kilpatrick. “Charter One has shown a strong commitment to the city of Detroit, by making loans available through the Housing Bank program, which helps to provide the quality housing our residents deserve.”
Loans will be available to non-profit developers at the fixed interest rate of 5 percent for the construction period. For the remainder of the term, the interest rate will be fixed at prime rate with a 7 percent lifetime cap. A minimum of 51 percent of any development must be reserved for affordable housing.
Another component of the initiative is the "Charter One Housing Heroes” award program, which will annually recognize one non-profit developer who has completed an affordable housing project in the designated timeframe. The winner will receive a $50,000 grant from the Charter One Foundation and must allocate $10,000 of the award for a neighborhood-based initiative.
"The Charter One Housing Heroes award is an incentive for developers to go above and beyond what is expected," said Pierce. "We want to recognize those projects that demonstrate innovative solutions, effective use of resources, leadership in creating affordable housing, and strong fiscal responsibility. We want to reward those developers who really make a difference in our neighborhoods."
About Charter One Bank, N.A.
Charter One Bank, N.A., is a $41 billion bank operating in Illinois, Indiana, Michigan and Ohio. It has 480 branches and more than 800 ATMs.It has 120 branches and 135 ATMs in Michigan.Charter One is a subsidiary of Citizens Financial Group, Inc., a $155 billion commercial bank holding company headquartered in Providence, R.I. Citizens has more than 1,600 branches, approximately 3,700 ATMs and more than 26,000 employees in a 13-state retail branch network and has non-branch retail and commercial offices in about 40 states. Citizens is the eighth-largest commercial banking company in the United States ranked by deposits as of September 30, 2005. Citizens is owned by RBS (The Royal Bank of Scotland Group plc).
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