Banesco USA looks to benefit Puerto Rico with $250M federal injection
Banesco USA has closed on a $250 million investment from the U.S. Department of the Treasury’s Emergency Capital Investment Program, which will allow it to increase lending and provide financial impact to minority borrowers, minority-owned businesses, small businesses, and borrowers located in underserved or minority communities in South Florida and Puerto Rico.
Bank officials said that Banesco USA is the only bank recipient of ECIP located in Florida or Puerto Rico and the investment amount received is greater than the $237.5 million it was initially approved for under ECIP, announced in December 2021.
“Having access to even more ECIP capital than expected means Banesco USA is able to further expand our lending capabilities to our South Florida and Puerto Rico communities,” said Calixto (Cali) García-Vélez, CEO of Banesco USA. “The ECIP funding enables us to leave a lasting impact that will be seen for years to come.”
The economic effects of the COVID-19 pandemic, inflation and a lack of support have left communities struggling, especially those disproportionately impacted, and the investment of more than $8.7 billion by the U.S. Treasury through ECIP enables mission-motivated community financial institutions to help those communities, bank officials said.
As a minority-led MDI (Minority Depository Institution), Banesco USA will use the capital to further support minority borrowers, small businesses and projects which deliver significant community economic benefits in the predominantly minority communities it serves.
“We’re very enthusiastic about Puerto Rico because we see signs of recovery and a lot of excitement in the market. With this capital injection, Banesco will be an active participant in the island’s economic recovery,” said García-Vélez, who was appointed to his post in the latter half of 2021, as News is my Business reported.
Prior to joining Banesco, he served as the executive vice president of First BanCorp and as regional executive of FirstBank Florida, a subsidiary of First BanCorp. Before that, he served as president and CEO of the former Doral Bank in Puerto Rico, which gave him first-hand knowledge of the local market.
The executive, who met with Puerto Rico business reporters to discuss Banesco’s plans, also confirmed that the institution is looking to expand its footprint across the island. At present, it has a single branch in Hato Rey.
“We’re recruiting talent to expand our reach in the commercial segment, which is what we serve,” said García-Vélez.
“We’re also evaluating some locations in the western and southern areas to open branches in those markets because, although we have all the technological tools to serve them, we want to have that geographical proximity that’s also important for some commercial clients,” he said.