Funds will launch its state-wide Let’s Work Wisconsin initiative
A $500,000 grant will provide seed capital for the new Let’s Work Wisconsin initiative. North Milwaukee State Bank ( NMSBank ) recently received a grant from the CDFI for its lending efforts and promotion of economic development in its community.
The Let’s Work Wisconsin initiative is a program headed by NMSBank designed to employ local citizens and restore jobs in the state of Wisconsin.
The bank desires to leverage its new grant to make $5 million in loans. According to local CDFI recipients, every $1 million in loans creates or retains 600 jobs. NMSBank will jump start its lending efforts with the first $5 million and hopes to help build the fund to at least $50 million.
The bank plans to apply for additional grants and will seek investments from local corporations and government entities to provide additional funding for the Let’s Work Wisconsin initiative.
According to NMSBank president Erbert Johnson, “We have to address this unemployment and stagnate, economic growth in Wisconsin, ourselves.
The Calvary is not coming over the hill to save us. This initiative is a self-help program and is straight forward.” Every $500K equity investment can leverage itself 10 times to provide $5 million in loans. Alternatively, an investor can split the $500,000 into a $250,000 equity investment and a $250,000 fully, insured deposit. This “unit” method will help fund $2.5 million of loans and provide a guaranteed return from the fully, insured deposit.
Johnson also states, “We have many partners in this community that have always supported our efforts. We believe others will join our efforts to get Wisconsinites back to work. NMSBank plans to minimize its credit risks by partnering with local, prominent entities to refer their diverse suppliers, because these suppliers will have a high level of certainty regarding their cash flow. Due to these long-term relationships, our risks will be minimized.
The bank will further reduce its risks by partnering with trainers to educate the borrowers in best practices.” President Johnson, as a member of the Milwaukee Rotary Club, GMC and MMAC, will seek collaborations to set up a series of information sessions on the Let’s Work Wisconsin initiative. This initiative is expected to fully launch in January of 2012.