• View Video on Investment Process
  • Download 2021 Impact Report
  • 703.466.0483
  • Investor Portal
Solomon Hess
  • Home
  • About
  • Impact
  • Investment Strategies
    • SBA Loan Fund
    • Absolute Return Investments
  • News
  • Resources
    • 2021 Impact Report
    • 2020 Impact Report
    • 2019 Impact Report
    • Aeris Impact Management Assessment, August 2019
    • 2019 CRA Survey Report
    • Moody’s Rating Announcement, January 2018
    • 2018 Impact Report
    • 2017 Impact Report
    • 2016 Impact Report
    • CRAnews
    • CRA Exam Excerpts
    • Loan Profiles
  • Contact
  • Search
  • Menu Menu

SBA LOAN FUND

The SBA Loan Fund is only available for qualified institutional buyers or accredited investors.

SBA LOAN FUND INVESTORS:

  • Financial institutions, diversified financial services companies and non-traditional lenders seeking targeted Community Reinvestment Act (CRA) Community Development credit
  • Financial institutions and other institutions seeking risk-adjusted returns for investing in a diversified pool of government guaranteed securities
  • SBA 7(a) pool investors seeking to diversify premium risk and stabilize cash flows
  • Rated Aaa-bf by Moody’s Investor Services, highest possible credit quality rating
  • Impact Management Assessment Certified by Aeris

Asset Class:

The Fund is rated Aaa-bf (“triple A bond fund”) by Moody’s Investor Services, the highest possible credit quality rating. The Fund primarily invests in the federally guaranteed portion of SBA 7(a) loans that adjust quarterly or monthly and are indexed to the Prime Rate.

SBA 7(a) Asset Class

INVESTMENT OBJECTIVE:

The Fund seeks to provide current income that is consistent with the returns available in adjustable-rate government guaranteed financial products by investing in Community Development Loans guaranteed by the Small Business Administration (SBA). Community Development Loans are loans to small businesses located in Low and Moderate Income areas or that employ Low and Moderate Income persons.

Investment in the Fund can be counted for either Community Development Lending Test or Investment Test credit for CRA. As of December 31, 2022, the Fund had over $790 million of gross assets and over 120 funded investors.

DOWNLOAD FACT SHEET

VIEW INVESTMENT PROCESS VIDEO:

Impact

Since inception, the Fund has supported the creation and/or retention of over 73,000 jobs as of December 31, 2022.

Investment benefits:

Cost Efficient Investment

  • No front or back end sales charge or load
  • A maximum 0.60% management fee, subordinated to Preferred Return

Risk Mitigation Features

  • Primary asset class is federally guaranteed and variable rate
  • Diversified portfolio with over 1,000 loans currently in the Fund, “SBA Mega-Pool”
  • Monthly liquidity
  • Rated Aaa-bf by Moody’s Investor Services for high credit quality

CRA Benefits

  • Community Development Investment or Lending Test eligible*
  • Targeted CRA credit within an investor’s assessment area
  • Quantifiable impact data: jobs created and/or retained
  • A CDFI Fund designated Community Development Entity (CDE)
  • New Markets Tax Credit Allocatee
  • Impact Management Assessment Certified by Aeris Insight

Fund Service Providers:

  • U.S. Bank N.A. – Fund Custodian
  • CohnReznick LLP – Audit
  • U.S. Bancorp Fund Services, LLC – Fund Administrator

View Mission Driven Lenders Video:

*Past performance is no guarantee of future results and future returns are not guaranteed. While every investor has received positive CRA consideration from their regulator thus far, this is no guarantee of future results and future exam results are not guaranteed. The Fund has not been approved by any regulatory agency.

Investor Subscription Process

Minimum investment in the Fund is $1,000,000. An investor commits to the Fund by executing a non-binding subscription agreement which details the investment commitment amount and in what, if any, CRA geographical area the SBA loans need to be located.

The Fund Manager will attempt to acquire SBA loans that meet the investment criteria of the investor. Upon successful acquisition of “substantially all” (85%) of the loans in the investor’s “Targeted Region,” the investor will wire funds to an investment custody account maintained by the SBA Loan Fund with U.S. Bank’s Trust Securities Services.

The investor will then receive quarterly distributions and statements from the Fund Manager, via U.S. Bancorp Fund Services, and will be able to redeem its investment on a monthly basis with 30 days’ notice, subject to the terms of the Fund’s Private Placement Memorandum and Operating Agreement, which are available upon request.

SBA Loan Fund Investment Process PDF

COIN Qualified Investment

SBA Loan Fund has been certified as a COIN Qualified Investment Fund.  The California Organized Investment Network (COIN) serves as a national model that provides leadership in increasing insurance industry investment in underserved and rural communities throughout California.  Its mission is to guide insurers on making safe and sound investments that yield environmental benefits throughout California and/or social benefits within the State’s underserved communities.  To earn this certification, the Fund demonstrated that it provides a positive environmental impact to low-to-moderate income households or areas, as well as rural and reservation based communities in California.

Learn More about COIN Qualified Investments

Community Reinvestment Act

The Community Reinvestment Act is a federal law enacted in 1977 that encourages financial institutions to help meet the credit needs of borrowers in all segments of their communities including low and moderate income neighborhoods. The act applies to depository institutions that carry FDIC deposit insurance and is enforced by federal regulatory agencies examining banks for CRA compliance. This information is taken into consideration when approving applications for new bank branches or mergers.

View CRA Exam Excerpt Sample PDFs

SBA Loan Profiles

All 12
All 12 /SBA Loan Fund Investments 12

Warrior Service Company, Valley Stream, New York

A Passion for Kids, Milwaukee, Wisconsin

Pasa Alta Manor, Pasadena, California

The Best Bees Company, Roxbury, Massachusetts

Mike’s Bike Park, Dayton, Ohio

Valley Food Systems, Youngstown, Ohio

Gotham-greens-small-business

Gotham Greens, Brooklyn, New York

Baked in the Sun, San Diego, California

Carolina_kitchen-small business-investor

Carolina Kitchen, Hyattsville, Maryland

Drone Workforce Solutions, New Castle, Delaware

southwest-autism

Southwest Autism and Behavioral Solutions, Las Vegas, Nevada

D’Image Beauty College, Phoenix, Arizona

Page 2 of 3123

The loans profiled on this website are current or former holdings of the SBA Loan Fund. The loans highlighted may not be the highest performing loans in the Fund, but a sampling of small business loans with an impact story. The loans mentioned do not necessarily represent all of the loans held in the Fund and investor should not assume that the loans identified and profiled were or will be profitable. A complete list of holdings for the Fund can be provided by contacting Solomon Hess Capital Management.

The Solomon Hess SBA Loan Fund LLC attempts to provide its investors with CRA credit related to their participation in the Fund. Investment decisions are not always exclusively based on the economic characteristics or investment merit of a specific asset. Certain CRA eligible securities sought by the Fund in specific geographies may not provide as great an economic benefit to the Fund as the same securities located in non-CRA geographies. The Fund may engage in transactions at times for reasons related to CRA considerations that may not be desirable from an investment standpoint. If one or multiple federal banking regulators, such as the OCC, FDIC or the Federal Reserve Board, were to deem an investment in the Fund as not qualifying for CRA credit, the impact to Fund investors could be material.

MANAGING GOOD CAPITAL WELL
Contact us to learn more.

START TODAY
  • Home
  • About
  • Impact
  • Investment Strategies
  • News
  • Resources
  • Contact

Solomon Hess Capital Management

431 Park Ave, Suite 401 - Falls Church, VA 22046

703.466.0483

Join our Newsletter

  • This field is for validation purposes and should be left unchanged.
© Solomon Hess :: Website by Integritive Web Design :: Asheville, NC
  • Terms of Use
  • ADV Part 2
  • Privacy Policy
  • Disclaimers & Risk Disclosure
Scroll to top