Columbia-headquartered Optus Bank is the first beneficiary of PayPal Holdings Inc.’s $530 million commitment to support Black and minority-owned business and communities.
Optus received $50 million in deposit funding from the online payments system operator, and CEO Dominik Mjartan said the bank wasted no time putting the investment to use. Advertisement
Ten million of the funding helped ramp up the bank’s Paycheck Protection Program loan efforts serving hundreds of small businesses.
“What that allowed us to do was to really step out and start funding these PPP loans, knowing that we didn’t need to worry about short-term liquidity issues related to the PPP funding,” Mjartan said. “Even though we had liquidity sources lined up, still you have a short-term gap before that funding comes in from the Federal Reserve. You need some gap funding. So that $10 million of long-term funding allowed us to really not worry about liquidity. All we’ve had to worry about is how many small businesses can we help, and let’s move as quickly as we can to help as many businesses as we can.
“That was transformational for the 600 businesses that we funded with more than $40 million in loans in the last four months.”
The remaining $40 million from PayPal was structured as “on-demand funding,” Mjartan said, invested in multiple short-term tranches to provide long-term, low-cost liquidity to bolster the bank’s continued growth.