America’s $205 Billion Government Fund You’ve Never Heard Of | Conor Coleman, Head of Investments at Development Finance Corporation (DFC)
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Today's episode is brought to you by the Tucrium Corn Fund, ticker c o r n. Let's get into it. There's a very, very large player in global finance that almost no one knows about, the Development Finance Corporation. It just had its reauthorization from $60,000,000,000 to $205,000,000,000. A lot of people talk about BlackRock, Federal Reserve, and, yes, the numbers there are very large as well. But a lot of that activity is moving from bank reserves to treasury bills or, you know, not something that's a real risk transformation. Whereas here, we're talking about an entity that is investing subs
Jack, thank you so much for having me on today.
I think it's really important, Connor, because the DFC Development Finance Corporation does so much in finance, and many people are familiar with the heavyweights, the Federal Reserve, BlackRock. But I think very few people, even who work in the investment business, are know about the DFC. So first off, my first question, what is the Development Finance Corporation?
I think that's such a good point. Frankly, I I'd been in the private sector my entire career before I took this opportunity, and I I did not even hear about the DFC until then got the call from the president. By way of background, the DFC is the international investment arm of the United States government and a central player to economic state craft for for The United States. We look to drive private capital mobilization through our investment strategy, which is both strategic investments and investments that drive economic development. Our goal is to make a return for United States taxpayer,
Just to give people a scale, the previous amount of money that the Development Finance Corporation could invest was $60,000,000,000. That just got raised to $205,000,000,000. What are the rough asset classes that the Overseas Investment Authority of the United States government is investing in? Could they be categorized as loans, as private equity, anything, you know, public stocks? What what are we talking about here?
Under Ben's leadership, we're really kind of expanding our our toolkit in order to effectuate the message. So historically speaking, dating back to our predecessor agency OPIC, and during the first couple of years of the DFC until we were reauthorized, we kind of focused on investing through three main asset classes. One is senior secured project finance lending, which is just senior secured loans. The second is offer providers of political risk insurance or guarantee products. And the third is what I call intermediary investing, which is us being a traditional LP in funds or lending into regi
So you talk about the chief executive officer of the DFC, Ben Black. Just to give people a a sense that when people hear the Ukraine minerals deal that president Trump did, that was through the DFC. When people talk about the Strait Of Hormuz reinsurance program, that was through the the DFC. So I I wanna get into those specific deals. Maybe let's start at with the the reinsurance program. What is the goal of that deal? How did it sort of meet the the objectives of of the DFC, and and how's it going?
I would say the maritime insurance product and just the the way we structured the investment and how quickly it came to fruition is really a a great case study of how we're gonna be acting with the new DFC going forward. So as you probably saw in the president's true social, he tasked the DFC to partner with the US military to create a product that offered the ability to restart maritime commerce in The Gulf. So when we looked into that initiative and re
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