Bank of America Pledges $10 Million to CUs: Onsite Reporting
PHOENIX – Bank of America pledged $10 million to the National Federation of Community Development Credit Unions. NFCDCU CEO Cathie Mahon made the announcement at the CUNA Community Credit Union and The Federation 2015 Annual Conferences at the Sheraton Downtown in Phoenix Wednesday.
The money will go to the National Federation’s Community Development Investment Program, which provides capital resources to member CDCUs seeking funds to increase liquidity, boost net worth, mitigate risk and introduce innovative products. The CDI Program has invested more than $100 million in CDCUs since its inception in 1982, the National Federation said.
The organization said the money will go toward the launch of a new secondary capital loan product and funding investments for high performing credit unions. The first three recipients of these funds are the $372 million Freedom First Federal Credit Union in Roanoke, Va.; the $918 million IH Mississippi Valley Credit Union in Moline, Ill. and the $6.5 billion Suncoast Credit Union in Tampa, Fla., each of which will receive $1 million.
“The Federation is thrilled to partner with Bank of America to develop this new secondary capital product to increase services and community development impact in low-income communities,” Mahon said during the announcement. “This infusion of secondary capital into the credit union system will enable several of our high-capacity member institutions to grow their services and increase safe and affordable lending to consumers who might otherwise turn to predatory lenders.”
Dan Letendre, the CDFI managing director for Bank of America, stated, “We’re proud to have partnered with the Federation to invest in community development credit unions, helping to meet the financial needs of low-income families, and we look forward to continuing to support these efforts.”
Barbara Stevens, the former CEO of the $48 million Houston Metropolitan FCU and chair of the Nataional Federation’s Investment Committee, encouraged member credit unions to apply for Federation secondary capital.
“Secondary capital can be used by growing community development credit unions to expand affordable lending to local communities,” she said. “The Federation's Community Development Investment Program looks forward to deploying Bank of America's investment over the coming year.”
Letendre told the meeting's attendees that Bank of America will get CRA credit for the investment, but that its use is not limited to locations where the bank has a presence.