JPMorgan Launches Initiative To Invest $500M In Underserved Communities That Qualify
JPMorgan Chase is launching a massive initiative aimed at improving struggling communities all over the world — and it is throwing considerable financial weight behind it.
The banking giant announced Wednesday the creation of its AdvancingCities initiative, a five-year program created to identify and invest in 30 communities across the globe with the need for neighborhood assistance through local public and private partnerships. The investment bank is dedicating $500M of its own capital to the program and anticipates outside funds contributing another $1B to its efforts.
JPMorgan is inviting cities to submit applications through Nov. 30 for the AdvancingCities Challenge. Winning proposals, according to a press release from the company, "will support existing local coalitions of elected, business and nonprofit leaders working together to address major social and economic challenges such as employment barriers, financial insecurity and neighborhood disinvestment."
The results of the challenge will be announced in the spring of 2019.
Beyond the initiative, the bank will also select certain cities for targeted investment geared at producing equitable growth across communities. It plans on announcing at least one foreign city that it has targeted for such investment this fall.
“Opportunity is not shared equally across neighborhoods,” JPMorgan Chase Chairman and CEO Jamie Dimon said in the release. “Businesses can and must step up to help change the status quo by creating a better future for all, no matter where they live. It is in our best interest and the right thing to do.”
JPMorgan will split its $500M investment in half, with one portion going toward philanthropic initiatives and the other toward low-interest, long-term loans provided by the AdvancingCities Investment Fund. As for the outside capital, the bank is predicting that other investors and organizations will add to its initial contribution. JPMorgan said similar contributions were made on a smaller scale for previous community investments in Detroit, Washington, D.C., and other cities wherein private investors more than quadrupled its contributions.
The investments and donations will go toward what the bank considers its four main focus areas of philanthropy: supporting the creation and growth of small businesses, providing job and skills training, preserving and expanding affordable housing, and improving individual financial stability. JPMorgan will also work toward fostering cooperation between local businesses, nonprofit entities and municipalities to more effectively serve those who often must interact with disparate social and business services to get by.
To help determine best practices, the investment bank has formed an external advisory board filled with leaders in business, politics and academia such as University of Maryland, Baltimore President Freeman Hrabowski and former Philadelphia Mayor Michael Nutter, now a professor at Columbia University.
“Mayors can get a lot done, but they can’t do everything,” Nutter said. “You need leadership from community organizations and business leaders too in order to attract additional investment and build support for solutions."