Commitment is Federation’s Largest-ever Private Sector Investment
(June 17, 2011 – Hollywood, CA) At its 37th Annual Conference on Serving the Underserved, the National Federation of Community Development Credit Unions (Federation) announced the single largest private-sector investment in the history of the community development credit union movement.
Bank of America has committed $10 million to the Federation’s Community Development Investment Program (CDIP) for deposits in low-income credit unions nationwide, with a primary focus on markets served by the bank. The investment will be placed as deposits in credit unions across the country to provide financial support for lending and balance sheet management. The Federation has a network of over 237 community development credit unions (CDCUs) providing credit, savings, transaction services and financial education to approximately 1.7 million residents of low-income urban and rural communities across 44 states and the District of Columbia.
“Bank of America has long been the Federation’s largest investor among financial institutions, with investments both in our deposit program and our CDCU Mortgage Center, LLC,” remarked Federation President/CEO Clifford N. Rosenthal. “We are delighted that they have decided to dramatically increase their support for CDCUs amid a recession that continues to take a heavy toll on the low-income communities they serve.”
Dan Letendre, Senior Vice President at Bank of America, discussed the investment. “Our commitment supports the valuable work and services that community development credit unions provide to millions of low-income consumers. Now more than ever, these credit unions fill a gap in providing financial services in underserved communities, and Bank of America is delighted to partner with the Federation in bringing a significant amount of capital to this market.”
Bank of America is the nation’s largest investor in Community Development Financial Institutions (CDFIs), including community development loan funds as well as community development banks and credit unions, with more than $1 billion invested with 120 CDFIs in 37 states.
“Bank of America’s commitment will enable us to channel capital to CDCUs at a lower rate than we’ve been able to offer in the past,” Rosenthal said. “We will be able to offer terms from one to five years to our credit unions, which will be especially valuable in enabling them to better manage their assets and liabilities.”
Community development credit unions are non-profit financial institutions that are regulated and fully insured by the United States government. They have a specific mission of serving low-income and minority communities that are typically beyond the reach of banks and mainstream credit unions. The Federation’s member CDCUs specialize in serving populations generally considered the hardest to serve, including low-income wage earners, recent immigrants, and people with disabilities.
© 2011 National Federation of Community Development Credit Unions.