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DENVER-Vectra Bank Colorado has bought $6.98 million in bonds from the Colorado Housing and Finance Authority that will finance 263 affordable multifamily rental units in nine Colorado counties. CHFA sold the bonds to finance 12 loans from its Small Affordable Rental Transactions, or SMART program.

The SMART program provides competitive-rate loans of up to $1 million for rehabilitation or construction of small developments containing affordable rental units.

Vectra Bank is the first bank to purchase CHFA’s SMART program bonds.

The developments being financed with Vectra’s investment are located in the cities and counties of Denver and Broomfield, and Jefferson, Montrose, Teller, El Paso, Mesa, Garfield, and Pueblo counties–all communities in which Vectra operates branches. Out of the 263 units, 242 units will be reserved for households earning less than 60% of area median income.

“CHFA’s SMART program provides financing for smaller developments that are often the most difficult to build and keep affordable,” says CHFA executive director Milroy Alexander. “This private placement provides a new source of capital for CHFA so that we can make more loans for affordable rental units throughout the state in the future.”

“Partnering with CHFA provides Vectra with an investment that helps address Colorado’s pressing affordable housing needs,” says Vectra Bank president and chief executive officer Bruce Alexander. “Just as importantly, it helps us meet our personal commitment to support and better serve the communities where we have branches.”

The deal is the second private placement of CHFA bonds with Vectra Bank. Last year, Vectra purchased $6.87 million in single-family loans to first-time homebuyers. By purchasing the loans, Vectra earns community reinvestment act credit required for all banks, while CHFA was able to recapitalize its home finance program for use towards new home loans.

Vectra Bank Colorado is Colorado’s fifth largest bank, with total assets of $2.7 billion.

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