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Delegation from Indias co-op banks visits WOCCU
MADISON, Wis. (4/14/08)--Ten CEOs and board chairs from India's cooperative banks visited the World Council of Credit Unions (WOCCU) last week as part of the group's tour of North American credit unions and their associations.
Pete Crear, left, president/CEO of theWorld Council of Credit Unions, presents a welcome gift to Bhima Subrahmanyam, managing director of India's National Federation of State Cooperative Banks. (Photo provided by the World Council of Credit Unions)
The delegation, all members of India's National Federation of State Cooperative Banks (NAFSCOB), is part of a restructuring program to address nonperforming loans and governance issues in rural financial cooperatives. WOCCU has offered to technical assistance to the cooperative banks in support of the government's economic reform efforts. The two-week tour includes visits to the National Federation of Community Development Credit Unions and Lower Eastside People's FCU, New York; Credit Union Central of Canada and Credit Union Central of Ontario in Toronto; Community One FCU, Las Vegas; WesCorp; and Water & Power CU, Los Angeles. The group's interests include credit union regulatory efforts, taxation, technology, and human resource and management issues, according to Bhima Subrahmanyam, NAFSCOB's managing director. “We'd especially like to understand your regulatory mechanism and its impact on credit unions,“ Subrahmanyam said. “Competition and capital adequacy requirements are also of interest. Indian cooperatives haven't been meeting their capital requirements due to poor resources.“ India is in the process of a $3.4 billion reform and recapitalization of its financial cooperative sector, with financial support from the World Bank and Asian Development Bank. Those efforts are supported by a controversial plan to forgive $15 billion in non-performing loans to small Indian farmers. Of that amount, roughly $8.5 billion will go to forgive loans granted by India's cooperative financial institutions. India's cooperatives recently lost their tax-exempt status, putting additional pressures on institutions to provide services, Subrahmanyam said. The National Bank for Agricultural and Rural Development is responsible for the reforms and recapitalization, a process in which WOCCU hopes to assist through the influence of NAFSCOB and its member cooperatives. WOCCU President/CEO Pete Crear applauded the work of the cooperative bank federation and its members in serving members. “We hope this is the beginning of a closer relationship between our two organizations,“ he said. Now more than 100 years old, India's financial cooperative system is the largest in the world in terms of people served. Credit union pioneer Edward A. Filene's visit to India's financial cooperatives in 1906 inspired him to help launch the U.S. credit union movement. In addition to presentations from WOCCU staff, the delegation also heard from the Credit Union National Association, CUNA Mutual Group and Heartland CU, all located in Madison, Wis. The National Federation of Urban Cooperative Banks and Credit Societies, India's trade association for urban cooperatives, is an associate member of WOCCU.
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