nfcdcu at pipeline.com (N
11-06-1995, 12:08 PM
I am responding on behalf of Cliff Rosenthal, our Executive Director, to a
number of points that have been raised in this discussion group over the
past few days.
Self-Help CU of Durham, NC, our largest member, is unusual in many ways.
The credit union is actually part of a larger organization, the Center for
Community Self-Help, which has the basic structure described by Bill Myers
in his earlier posting. There is also a loan fund included within this
larger organization to perform lending that the credit union cannot.
It should also be noted that Self-Help, like Santa Cruz Community Credit
Union, is state chartered. If they were federally chartered, they would
probably have a harder time doing what they do. Federally chartered credit
unions are permitted to do small business lending, but it is regulated in
the manner described by Bill Myers. In some states, that regulation is not
as restrictive.
Cal Hollis correctly pointed out that charter type is not an issue in
performing small business lending, so long as the businesses to be served
are included within the credit union's field of membership. There is no
such thing as a "community development" charter. The term community
development credit union was coined by this organization slightly more than
twenty years ago to describe credit unions that serve predominantly
low-income communities with the goal of developing those communities.
CDCUs are self designated, and they have no special powers or abilities.
More recently, the National Credit Union Administration developed a
low-income designation for credit unions whose fields of membership are
predominantly low-income; that is, if 50.1% or more of their fields of
membership make less than 80% of the national median household income.
This designation is not equivalent to being a CDCU. Not all CDCUs have the
low-income designation, or vice versa. This designation does confer
certain powers. Basically, low-income designated credit unions are allowed
to accept deposits from non-members, where credit unions without this
designation cannot. This designation does not affect the products and
services that a credit union is allowed to offer.
--
Morgan N. Sandquist
National Federation of Community Development Credit Unions
120 Wall Street - 10th Floor
New York, NY 10005-3902
(212) 809-1850
(212) 809-3274 - Fax
nfcdcu@pipeline.com - E-Mail
This post transferred from the cdb-l mailing list
number of points that have been raised in this discussion group over the
past few days.
Self-Help CU of Durham, NC, our largest member, is unusual in many ways.
The credit union is actually part of a larger organization, the Center for
Community Self-Help, which has the basic structure described by Bill Myers
in his earlier posting. There is also a loan fund included within this
larger organization to perform lending that the credit union cannot.
It should also be noted that Self-Help, like Santa Cruz Community Credit
Union, is state chartered. If they were federally chartered, they would
probably have a harder time doing what they do. Federally chartered credit
unions are permitted to do small business lending, but it is regulated in
the manner described by Bill Myers. In some states, that regulation is not
as restrictive.
Cal Hollis correctly pointed out that charter type is not an issue in
performing small business lending, so long as the businesses to be served
are included within the credit union's field of membership. There is no
such thing as a "community development" charter. The term community
development credit union was coined by this organization slightly more than
twenty years ago to describe credit unions that serve predominantly
low-income communities with the goal of developing those communities.
CDCUs are self designated, and they have no special powers or abilities.
More recently, the National Credit Union Administration developed a
low-income designation for credit unions whose fields of membership are
predominantly low-income; that is, if 50.1% or more of their fields of
membership make less than 80% of the national median household income.
This designation is not equivalent to being a CDCU. Not all CDCUs have the
low-income designation, or vice versa. This designation does confer
certain powers. Basically, low-income designated credit unions are allowed
to accept deposits from non-members, where credit unions without this
designation cannot. This designation does not affect the products and
services that a credit union is allowed to offer.
--
Morgan N. Sandquist
National Federation of Community Development Credit Unions
120 Wall Street - 10th Floor
New York, NY 10005-3902
(212) 809-1850
(212) 809-3274 - Fax
nfcdcu@pipeline.com - E-Mail
This post transferred from the cdb-l mailing list