Washington Credit Unions get CDFI Grants Totaling Over $3 Million
September 2, 2014
September 2, 2014
Two Washington credit unions, Lower Valley Credit Union and Industrial Credit Union, were awarded grants by the U.S. Treasury Department’s Community Development Financial Institution Fund (CDFI Fund) this week.
Industrial received a $1.99 million grant and Lower Valley received a grant of $1.65 million. They were among 21 credit unions that were awarded funds nationally.
The CDFI Fund supports credit unions, community development banks, and other financial institutions in serving market niches that are underserved by the mainstream financial system. This fiscal year the fund will award $160.8 million to 152 organizations nationwide.
“It’s a real honor for the U.S. Treasury to recognize the fact that not only are we a successful credit union,” said Terri Salstrom, CEO of Industrial Credit Union, “but we have a good plan and a great opportunity to leverage these funds to support our community.”
During the financial crisis, Industrial saw a lot of contractors and small companies folding because the traditional banking community was cutting off lines of credit. “We realized we were already providing [community development] services,” said Salstrom, “we just weren’t taking advantage of chances to be more successful.”
Industrial became CDFI certified in 2010 and got their first grant in 2011 for a little over $1 million. They went through regular recertification this year.
Industrial will use the grant to invest in the growth of the agriculture sector in their region, said Salstrom. “It’s a much bigger concept than providing funding for the farmer,” said Salstrom. She explained how a thriving agricultural sector would improve the health and economy of the region. “But we’ll take it one step at a time.”
Lower Valley President and CEO Suzy Fonseca received the news of her institution’s grant just before a scheduled board meeting. “It made for an exceptional meeting,” she said.
Lower Valley will use the grant money to leverage its lending and investment programs in its surrounding, low-income, predominantly Hispanic communities.
“We see this grant as an opportunity to serve the hundreds, if not thousands, of individuals that we will be able to reach through the various services we provide, as well as those we have yet to reach,” said Fonseca. “We will have a continued focus on the importance of outreach, and in further supporting our community partners such as Nuestra Casa, a nonprofit dedicated to the education, empowerment, and mutual support of immigrant women and their families. We will also be enhancing our role in the education of our local community members concerning financial literacy by offering targeted workshops and seminars.”
Last year three credit unions in the Northwest received CDFI Fund grants totally nearly $700,000.
Examples of services that qualify for funding include mortgage financing for low-income and first-time homebuyers and not-for-profit developers, flexible underwriting and risk capital for needed community facilities, and technical assistance, commercial loans and investments to small start-up or expanding businesses in low-income areas.
To qualify for a CDFI Fund grant, a financial institution must first apply for CDFI certification.
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