The Presbyterian Church is creating a family of mutual funds in which its affiliated colleges, schools and congregations can invest the money they raise.

The Presbyterian Church USA Foundation, the fund-raising arm of the Presbyterian Church, is seeking approval from the Securities and Exchange Commission for a family of four funds to be called the New Covenant Funds. The funds are intended for the Presbyterian Church's 11,000 congregations, their ministries and charities, and several hundred colleges and schools affiliated with the Presbyterian Church in the U.S. Church officials have no plans to market the funds to their 2.6 million church members, or to the public.

"I don't think Fidelity or Vanguard have anything to fear from the Presbyterian Church," said Larry Carr, president and chief executive officer of the Foundation. The New Covenant Funds family will consist of a growth fund, an income fund, a balanced growth fund and a balanced income fund. While New Covenant Trust Co., NA will be the adviser to the funds, several different money managers will subadvise. The funds will follow investment guidelines that adhere to principles of the General Assembly of the Presbyterian Church. They include limitations on investments in military contractors, alcohol, tobacco and gambling. The Presbyterian Church is converting four privately managed accounts into the four funds and will use the performance history of those accounts in its prospectuses.

There are a handful of funds affiliated with churches, according to Ritchie Lowry, a sociology professor at Boston College who runs Good Money, a website on socially responsible investing. Among those offering funds are the Lutheran Brotherhood and the Anabaptist church.

While there is no plan to aggressively sell the Presbyterian Church funds to individuals, nothing prohibits individuals from purchasing shares of the funds, says Carr. He admitted that the church could change its mind and sell to individuals in the future. Shares of the fund will be sold through First Data Distributors, Inc. and through representatives of the Presbyterian Church USA Foundation located throughout the country.

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