Institutional Capital for Social Impact: New Investment Bank Focused on Bringing Capital to Disinvested Communities
Momentus Securities aims to deliver more than $3 billion in community-based investments by 2026
May 22, 2023 (New York, NY) – Momentus Securities has launched with the goal of driving institutional capital to America’s small businesses and nonprofits — and positioning “social impact” as a fully investable asset class for institutional investors.
Momentus Securities — a registered broker-dealer and FINRA member — seeks to disrupt the mission-driven investing space by addressing the current scale and liquidity limitations in the sector that inhibit the deployment of institutional capital. Momentus Securities intends to facilitate the deployment of $3 billion of social capital by 2026.
“This is an innovative approach. We are transforming how institutional investment capital is unlocked and channeled into high-need community investments,” said Momentus Securities President and CEO Alicia Reyes, who brings 27 years of experience in investment banking and private equity to Momentus Securities. “The lending market in the impact sector is decentralized and highly dispersed. This is a challenge for institutional investors that want to fully incorporate the ‘S of ESG’ into their mainstream strategies because of the lack of liquidity.
“We see this as an opportunity to launch ‘social Collateralized Loan Obligations’ and, initially, intend to open warehousing lines to aggregate portfolios of loans across five key segments: affordable housing, healthcare, education, small businesses and food. Once ramped up, the portfolios will be securitized, and we will distribute the bonds as a takeout. These portfolios will offer institutional investors the opportunity to support communities and participate and invest at a scale not previously available. Lenders will achieve better terms while providing investors an improved risk return profile,” Ms. Reyes added.