Lower Valley Credit Union awarded $1.65 million by U.S. Treasury
Lower Valley one of 21 credit unions awarded nationwide through the CDFI Fund to enhance lending, investment in low-income communities
SUNNYSIDE, WA, (AUGUST 29, 2014) – The U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund has awarded Lower Valley Credit Union $1.65 million through the 2014 rounds of the CDFI Program. One of just 21 credit unions to receive a share of the $160 million in Financial and Technical Assistance available, and one of two in the Pacific Northwest, Lower Valley Credit Union (LVCU) will use the award to leverage its lending and investment programs in its surrounding low-income, predominately Hispanic communities.
Since 2010, the $72.5 million, 10,200-member credit union located in rural Washington State has originated approximately 1,100 loans to first-time borrowers, and 3,200 used-auto loans to its low-income and credit-impaired members. More than 88 percent of LVCU’s members qualify as low-income, and many work in agriculture where work is seasonal and sometimes hard to come by. The credit union’s average interest rate on a used auto loan is 127 percent lower than those charged at many of the area’s title lenders.
“CDFIs…are important community partners providing critically needed financing that not only allows families to buy their first home, or entrepreneurs to start or expand a business, but that generates economic growth and revitalizes America’s low-income and economically-distressed communities,” said Jessica Milano, Deputy Assistant Secretary for Small Business, Community Development, and Housing Policy at the U.S. Department of the Treasury. “The awards…will help these CDFIs…build their capacity in order to better meet the investment and lending needs of the communities they serve.”
“It made for an exceptional meeting,” said LVCU President and CEO Suzy Fonseca, who received news of the large award just minutes before a regularly scheduled gathering of the credit union’s Board of Directors. “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. 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.”
LVCU is a best-practice example of a financial institution that does very well financially even when committing to serve the underserved, lower-income market. The credit union is well-capitalized, profitable, and is growing at a phenomenal rate. According to the National Credit Union Association, LVCU’s five-year annual average asset growth rate is 17.2 percent; five-year annual average loan growth rate is 9.9 percent; and the five-year annual average membership growth rate is 15.1 percent. These results trump both credit unions of similar size and the credit union industry overall.
“The leveraging power of this grant funding is quite literally limitless,” Fonseca continued. “The need and demand in our market and communities is unimaginably large. LVCU happens to be one of the many credit unions that have made it our mission to truly serve the underserved segment of the market, and we, like many others, typically serve silently and continue to do great things. In doing so and staying focused on our membership, we will remain relevant for those in need of our services for many years to come.
“As our facilitator, grant writer and dear friend, Scott Butterfield is nothing short of amazing; we owe much of our voice to him and his passion for what we do,” Fonseca concluded. “We could also not be more pleased with the help, guidance, and support the Federation has provided us through this process. I highly recommend any credit union thinking about pursuing CDFI Certification funding to contact them for their services.”
Of the credit unions awarded grants, 63 percent were members of the National Federation of Community Development Credit Unions (the Federation). The Federation was instrumental in establishing the CDFI Fund, is a CDFI intermediary, and is a permanent member of the national CDFI coalition.
“The Federation is the trade association that represents the vast majority of credit unions that are currently certified as CDFIs,” explained Pablo DeFilippi, the Federation’s Vice President of Member Services. “Historically, most of the CDFI Awards have been received by Federation members, and we’re proud that this specific grant was awarded to Lower Valley, one of our rising stars in the community-development field.
“We congratulate them on this terrific accomplishment, which represents an official recognition of the groundbreaking work they have done for many years to bring affordable financial services to low-income consumers and underserved communities, particularly Hispanics,” DiFilippi continued. “We’re pleased to have played a role in assisting LVCU in tapping some significant external resources through our team of CUB consultants, the largest network of CDFI experts and community development practitioners with a nationally recognized track record in financial inclusion and asset development.”
Earlier this year, LVCU received the Credit Union Times’ Trailblazer Award for Outstanding Service to the Underserved.
“LVCU’s focus on providing both financial education and affordable financial services to its largely lower income membership made it this year’s Trailblazing credit union,” wrote David Morrison, senior staff reporter at the Credit Union Times. “When making this award, the Credit Union Times seeks credit unions that combine teaching members what they need to do with providing affordable products and services which help them do it. LVCU deserves the award and our congratulations.”
About Lower Valley Credit Union
Lower Valley Credit Union is a $72 million, Low Income Designated credit union deeply rooted in Washington State’s Lower Yakima Valley. Headquartered in Sunnyside, the credit union also operates branches in Prosser and Grandview, and will open an additional Sunnyside branch in the fall. LVCU is dedicated to serving its members through a wide array of products and services, including free checking and savings accounts, loans, mortgages, IRAs, certificates, and more!
About the Federation
The National Federation of Community Development Credit Unions is a certified CDFI Intermediary representing community development credit unions that provide credit, savings, transaction services and financial education to more than 2.5 million residents of low-income urban, rural and reservation-based communities across the United States, and hold over $20 billion in community-controlled assets. Founded in 1974, the Federation is headquartered in Lower Manhattan with offices in Madison, WI. The Federation offers a wide range of advocacy, educational, training, investment, marketing, and outreach programs to support and assist CDCUs. For more information about the Federation and its programs, please visit: www.cdcu.coop.