CEO, Vancity Community Investment Bank
Jay-Ann Gilfoy, CEO of Vancity Community Investment Bank (VCIB), shares her insights on the importance of values-based banking for organizations and the communities they serve.
What is values-based banking and what does it mean to VCIB?
Values-based banking is a way for banks to link investments, lending, and other services to social and environmental change. Values-based banks offer the same products and services as traditional banks, but what sets us apart is how we operate, who our clients are, and what we finance. All banks, whether traditional or values-based, use their clients’ deposits to fund loans. At VCIB, our clients have full confidence that their deposits are used exclusively to support more resilient and sustainable communities and to address needs around affordability, climate, and social inclusion.
Why is values-based banking so important right now?
It starts with the idea that money needs to be available to help solve some of the major challenges the world is grappling with, like the climate crisis and the economic inequality exacerbated by the COVID-19 pandemic. We focus on banking businesses and organizations addressing those challenges. Their work isn’t business as usual and they need a financial partner who understands that.
Values-based banking allows us to reimagine how we can use the tools of finance to create lasting change in our communities. This spring, for example, our clients came together to invest in VCIB’s Unity GIC and their deposits will now provide vital loans and financial relief to businesses and non-profits affected by the pandemic.
How is VCIB using the tools of finance to make a difference in the community?
Right now, VCIB exclusively partners with organizations that drive social, environmental, and economic change. You can see the difference we make by looking at our lending portfolios. Our real estate lending team has partnered with affordable housing developers like Options for Homes, providing financing that supports its model of offering down-payment assistance to moderate income families. Our clean energy finance team helps get more low-carbon projects off the ground by focusing on small- and mid-size projects underserved by traditional lenders.
What kind of organizations do you work with, and why do they come to you instead of a traditional bank?
At VCIB, we work with organizations that are looking to make a positive difference in their communities. We get to know our clients, we work through challenges together, and we connect them with other supports. Something we often hear our borrowers say is that they feel like they’re getting a partner, not just a lender.
One example of an organization VCIB recently supported is the Parkdale Neighbourhood Land Trust. We helped finance its acquisition and preservation of affordable rental housing in a gentrifying area and are now working together to build out the land trust model, which enables land to be used as a community asset for generations to come. Organizations that opt to bank with a values-driven institution can be confident their banking choices are making a difference in places like this, where and when it really matters.
What’s next for VCIB and its customers?
The events of 2020 have emphasized why organizations — especially financial institutions — need to employ a values-centric approach to business, and now more than ever, our mission is clear. In order to respond to the challenges of the pandemic, we made a decision earlier this year to accelerate our launch of new business banking and lending services — like pivot loans to help businesses and organizations adapt — while continuing to finance clean energy solutions and affordable housing. Our focus going forward is going to be all about banking a green and inclusive recovery.
Values-Based Banking in Action: VCIB and Options for Homes
Over the past 30 years, the cost of home ownership has increased dramatically in the Toronto region. First, it was low-income earners who struggled to own. Now, it’s moderate-income earners too. Options for Homes, an affordable housing developer and mission-driven social enterprise, has been working to reverse this trend for 25 years. Options develops high-quality condos and offers buyers up to 15 percent in down payment assistance, helping to make home ownership possible for individuals and families who have just a 5 percent down payment saved.
To support Options, Vancity Community Investment Bank (VCIB) extended a syndicated construction loan of more than $80 million for the organization’s latest development. Once built, The Humber will provide housing for 232 families in Toronto’s Weston Village neighbourhood.
The VCIB staff really get what we’re trying to do. They understand social impact and they understand the financing of these projects, and it makes them a great partner for our team.Heather Tremain, CEO, Options for Homes