Patelco Ups Capital Ante for Ailing CU
Even as it increases its capital donation for an ailing San Francisco credit union, Patelco CU disclosed Thursday its community outreach programs have witnessed a 60% budget cut over the last three years.
The $3.6 billion Patelco blamed the economy for the reductions but said it was hopeful 2011 would bring a change even as it strives to protect its "Adopt-a-Credit Union" program.
Patelco, the city's largest CU, numbers among a handful of donors contributing to an unusual campaign by the $6.6 million Mission SF FCU to raise capital from other CUs. Mission management has said it is facing NCUA liquidation or merger perhaps in a matter of days. The CU sent out solicitation letters Nov. 12 to California CU leaders as well as members of the National Federation of Community Development Credit Unions telling of its situation.
Last week Patelco pledged $6,000 toward the Mission SF campaign which has an initial goal of raising $50,000--eventually $300,000--and on Wednesday Patelco confirmed that it has added another $5,000.
The funds are being dispersed under Patelco's 15-year program to aid the survival of small Bay Area CUs, particularly Mission, one of its "adoptees."
Patelco provides an array of consulting services plus staff assistance on education sponsorships, purchase of stationary supplies, zero interest CDs, ALM education and other services. Beside Mission, other adoptees include Northeast Community CU, East Palo Alto FCU and Peoples Community Partnership FCU.
Ken Burns, president/CEO of Patelco, said that while the community outreach budget has been sharply reduced, "we have continued to maintain the small credit union program as much as we could."
As conditions improve, "we expect and look forward to restoring our community outreach efforts," he added.
While Patelco may be a Mission backer, others in California have taken issue with the restoration maneuver as unseemly and ill-advised considering the CU's poor lending record. Making that point on his own online blog has been Charles Bruen, president/CEO of First Entertainment CU of Hollywood, who questioned the wisdom of rewarding the CU like a "charity."