Nearly 700 credit unions nationwide, including 17 in Western New York, have been newly designated by regulators as “low-income credit unions,” exempting them from certain industry restrictions and freeing them to obtain grants, low-interest loans and extra capital.
The 676 institutions are among 1,003 that were notified two months ago by the National Credit Union Administration that they were eligible for low-income status. To qualify, most of a credit union’s membership must meet low-income thresholds based on 2010 census data.
The institutions that accepted the designation serve more than 7.7 million members, with more than $66 billion in combined assets nationwide. More than 80 percent of them have less than $100 million in assets, with a median size of $23.8 million.
Within the Buffalo Niagara region, the designated federal credit unions include: Albion School Employees, Allegany Community, Buffalo Metropolitan, CCSE, Greater Chautauqua, Greater Niagara, Griffith Institute Employees, Inner Lakes, Mount St. Mary’s Hospital, NFTA Employees, Niagara County’s FCU, Niagara Falls Teachers, Niagara’s Choice, Our Lady of Victory Institutions, Rediform Niagara Falls, St. Johns Buffalo and Westfield Area.
With the new status, they are now eligible to receive grants and low-interest loans from the Community Development Revolving Loan Fund. They can also get supplemental capital and can accept nonmember deposits from any source. And they can make “member business loans” in excess of 12.25 percent of total assets.
The goal of the NCUA outreach was to get more capital in the hands of credit union members, and particularly to help 27 drought-stricken states. In all, there are now 1,874 low-income designated credit unions nationwide, and 326 of the new institutions are in drought-affected states, representing half of new low-income credit union assets and members.
“We have had a very positive response to our low-income credit union eligibility initiative,” NCUA Chairman Debbie Matz aid. “The initiative aims to put needed financial services and resources into the grass roots of the American economy.”