(Bloomberg) -- The Federal Deposit Insurance Corp. announced a $120 million investment fund backed by companies including Microsoft Corp. and Truist Financial Corp. that’s designed to serve low-income and minority communities.
Discovery Inc. is also an investor in the first-of-its-kind fund that will allocate capital to banks that provide financial services to low-income, rural and minority borrowers, the FDIC said in a press release Thursday. While the regulator will serve as an adviser, the agency will not be involved in investment decisions.
“It is our hope that with the commitment of these industry leaders, more private equity investors will join the growing ranks of those committed to building opportunity and prosperity where this support is needed the most,” FDIC Chairman Jelena McWilliams said in the statement.
Regulators including the FDIC are facing pressure to find ways to reach under-served communities and Americans that don’t have access to financial services products. Separately, the biggest U.S. banks including Truist are required to comply with anti-redlining laws and make a certain amount of loans each year in low-income neighborhoods.
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