Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
CDCUs should be eligible for CDFI bond program
WASHINGTON (8/17/11)--The Credit Union National Association (CUNA) has recommended that credit unions that are designated Community Development Financial Institutions (CDFIs) be eligible for guarantees on notes that could be used as secondary capital. Specifically, CUNA said in a comment letter, CDCUs that are CDFIs should be eligible for the U.S. Treasury Deparment's CDFI Fund's developing Bond Guarantee Program. Under the CDFI Fund’s bond program, notes or bonds of up to 30 years duration issued by CDFIs would have full guarantees from the U.S. Treasury. The bond program, which is still being developed, would “support CDFI lending and investment by providing a source of long-term, patient capital to CDFIs,” the CDFI Fund said. The bond guarantee program was enacted by the Small Business Jobs Act of 2010. CUNA added that credit unions should be allowed to count any proceeds from these bonds as supplemental capital. CUNA also suggested that some types of CDCU subordinated notes should be eligible to be considered as supplemental capital for low-income credit unions, consistent with the National Credit Union Administration’s net worth regulations. Allowing credit unions to count bond proceed as supplemental capital would help them “leverage their net worth to add deposits and generate loans for a range of credit needs in low-income communities, including but not limited to microenterprise, providing working capital for small businesses, education, and other essential needs of their members,” CUNA added. The CDFI Fund should also consider revising its definitions of "low-Income," "underserved." and "rural area" to better conform to those of the National Credit Union Administration, CUNA said. CDCUs are among the financial institutions that may apply for membership in CDFI Fund programs. The CDFI Fund helps locally based financial institutions offer small business, consumer and home loans in communities and populations that lack access to affordable credit. A total of 960 financial institutions are certified CDFIs. For the full CUNA comment letter, use the resource link.


RSS print
News Now LiveWire
Economic activity slowed in June, according to the #Chicago Fed's national activity index, released today #Market http://t.co/1pN6peM8my
13 hours ago
Money burns a hole in workers' pockets after payday, despite best intentions via @WSJeconomy http://t.co/A9SNiUdf9v
14 hours ago
"SAR Stats," new from #FinCEN, focuses on #bitcoin. See #NewsNow http://t.co/vS7iTwY2SW
15 hours ago
.@CFPB now accepts consumer complaints on prepaid cards, debt settlement services, credit repair services, and pawn and title loans.
16 hours ago
.@WellsFargo to process transactions in order received, not high to low http://t.co/g0jWJoegoJ
16 hours ago