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Low-income credit unions encouraged to apply for CDCI capital

An April 2 deadline is quickly approaching for low-income credit unions in Alabama and Florida to apply for the Community Development Capital Initiative (CDCI) certification. This is important since only those credit unions will be able to apply for a low-cost secondary capital loan. Credit unions need to be certified through the NCUA or a state regulator and have the CDFI certification from the Treasury Department’s Community Development Financial Institutions (CDFI) Fund. Those credit unions that don't fit this category still have until April 16 to become designated. There are 32 low-income CUs in Alabama of which 10 are certified to apply; there are 11 in Florida, and only two of those are certified.

 

On February 3, 2010, Secretary of the Treasury Timothy Geithner announced a new program to help two specific types of credit unions and banks expand their credit and services “to the country’s hardest hit communities.” Within a short period of time ending on September 30, 2010, the CDCI program will bring hundreds of millions of dollars in low-cost secondary capital that will significantly strengthen the capital position of community development credit unions. The announcement was the culmination of six months of groundwork and collaboration with Treasury by the Federation of Community Development Credit Unions. In these challenging times, the capital infusion would help mitigate the impact of the financial crisis.

You can find more information about the CDCI at the Membership Relations page of Cooperative Initiatives. For any credit union that would like to become low-income designated, contact LSCU Vice President, Cooperative Initiatives Laura Vann.

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