Analyzing the CDFI Asset Gap: Examining Racial Disparities in CDFI Fund Awardees from 2003 to 2017
November 5th, 2020
Hope Policy Institute is interested in understanding trends in assets and capital held by minority ownership for CDFI Program awardees. Using institutional level reports (ILR) provided by the CDFI Fund, we completed an initial analysis of fiscal years 2014 and 2017. We found that average assets held by white-owned CDFI Program awardees significantly increased from FY2014 and FY2017 while minority-owned CDFI Program awardees experienced a slight decrease in average assets held. We also found that in FY2017, the average assets held by white-owned CDFIs were more than double that of minority-owned CDFIs. For our next analysis, we wanted to see if racial disparities existed across the full tenure of the CDFI Fund award program.
Read the full brief by Kiyadh Burt here.
- The number of white-owned CDFI Fund awardees has significantly outpaced minority-owned awardees every year. The number of minority-owned awardees has never exceeded more than 34% of the total number of awardees in any given year, and collectively represent just 291 (31%) of all 922 unique awardees during this timeframe.
- While the asset size for all CDFI Fund awardees has grown over time, the growth has not been evenly distributed. For example, in FY2017, white-owned awardees held $35.1 billion in assets, up from $4 billion in 2003, whereas minority-owned awardees held $5.7 billion in assets in 2017, up from $530 million in 2003. It took minority awardees until 2013 –10 years — to exceed the median asset size of white-owned awardees in 2003 ($5.5 million).
- There has been no progress in closing the asset gap between white and minority-owned CDFIs. Every year, the median asset size of white-owned awardees has been at least twice the median asset size of minority-owned awardees. In some years, it was 3 times as high.
- Additional analysis is limited by the lack of data collected by the CDFI Fund. Currently, the CDFI Fund does not collect minority-ownership for certified CDFIs. Without this data, it is not possible to know if the number of minority-owned CDFI Fund awardees is proportional to the CDFI field as a whole, and likewise we are unable to assess any broad trends within the CDFI industry by race.