FREE MEMBERSHIP Includes » ABL Advisor eNews + iData Blasts | JOIN NOW ABLAdvisor Gray ABLAdvisor Blue
Skip Navigation LinksHome / News / Read News


Bank of America Will Stop Financing Private Prisons

June 27, 2019, 09:00 AM
Filed Under: Industry News
Related: Bank of America

Bank of America announced that it will no longer finance companies that operate private prisons, barely four months after a similar move by JPMorgan Chase.

The decision, reported by multiple media outlets, comes amid increasing public pressure on the financial industry to sever ties with private prisons. Last Friday Democratic presidential candidate Elizabeth Warren called for private correctional and detention facilities to be banned.

In a statement to the Miami Herald, a BofA spokesperson explained the decision.

“We have decided to exit the relationships we have with companies providing prisoner and immigrant detention services for federal and state governments, as expeditiously as possible,” the spokeswoman told the paper. “We have had intensive engagement with the limited number of clients we have that are providing these services. We appreciate steps they have taken to properly execute their contractual and humanitarian responsibilities.”

The GEO Group, one of the nation's largest for-profit correctional firms, issued a press release saying it expects there to be no impact to its Senior Revolving Credit Facility with BofA, which was recently extended. The maturity for the amended Revolver was extended to May 17, 2024. The borrowing capacity under the amended Revolver remains at $900 million, and its pricing remains unchanged currently bearing interest at LIBOR plus 2.25%.

JPMorgan Chase & Co. took a similar step in March, breaking off its relationship with the industry after deciding it was too risky, and Wells Fargo & Co. is also halting loans to the industry.

Comments From Our Members

You must be an ABL Advisor member to post comments. Login or Join Now.