Innovation Grant Will Help Charter
Ohio's First Latino Credit Union
 

UPDATES:

SEPTEMBER 2009
$1.3 M in deposits raised for start-up CU, business donations sought
Efforts are underway to raise $100,000 in start-up capital for a proposed state-charted credit union in Toledo. While credit unions have committed nearly $1.3 million in insured, non-member deposits for Nueva Esperanza (New Hope) Community Credit Union (NECCU), regulators are requiring that approximately 10% of that amount be raised for capital before the credit union is opened. These funds, in the form of donations, are being solicited from Toledo-area businesses, individual business leaders, and individuals. NECCU incorporators, Toledo-area credit union leaders, and Ohio Credit Union League and Foundation staff met in late September with several business leaders to share the benefits that a credit union would provide the community. The credit union will serve residents of South Toledo, primarily of Latino descent. Among the credit union’s goals are increasing the level of financial literacy within the community by offering financial education classes and counseling; reaching out to working-class Latinos and other community members to educate them about the importance of depositing their money in a safe, regulated, financial co-op they can trust; and providing a safe, reasonably-priced alternative to many of the often high-fee financial services -- such as certified checks, savings accounts, and international money transfers. For more information or to make a donation to NECCU, contact League VP of Public Affairs Becky Hart at (614) 923-9706 or rhart@ohiocul.org.

SEPTEMBER 2009
Deposits, grants bring Latino community CU closer to reality
Nearly $1.3 million in non-member deposits has been committed by 25 credit unions in Ohio and three other states as start-up capital for a proposed state-charted credit union in Toledo. Nueva Esperanza (New Hope) Community Credit Union (NECCU) would be the first credit union chartered in Ohio in 11 years, and first state charter in more than 20 years. The credit union will serve residents of South Toledo, primarily of Latino descent. NECCU recently received two $50,000 grants – one from the Toledo Community Foundation and another from The Anderson Foundation – which will be awarded for start-up capital once matching dollars have been secured from the Toledo business community. Business leaders will meet with NECCU incorporators, Toledo-area credit union leaders, and Ohio Credit Union League and Foundation staff on Thursday to learn the benefits that a credit union will bring to the community. Several credit unions in the area – including Bay Area CU, Champion CU, Directions CU, and Great Lakes CU – have worked with the Latino community on the project for more than three years. Directions CU will provide back-office support to NECCU. The Ohio Credit Union Foundation is administering a $69,500 grant it secured for NECCU from the National Credit Union Foundation for staff salaries, board and staff training, and marketing.

AUGUST 2009
Toledo-area Latino CU moves closer to opening
A consortium of Toledo-area credit unions and organizations working to charter a community development credit union for Latinos in Northwest Ohio continues making progress. The Toledo Community Foundation has awarded a $50,000 grant to the Nueva Esperanza (New Hope) Community Credit Union, provided that it raises an additional $100,000, receives its charter, and obtains federal deposit insurance. The grant application was written by a grantwriter funded by the Ohio Credit Union Foundation, which obtained a $69,500 Innovation Grant from the National Credit Union Foundation to help with creation of the credit union. Nueva Esperanza Community CU would be the first new state-chartered credit union in Ohio in more than 20 years and serve an area in which more than 50% of area households are classified as low- or extremely low-income. Initially, it plans to focus on serving residents’ need for basic financial services and affordable credit by offering financial education, budgeting advice, basic savings, simple lending, credit counseling, and money transfers.
 

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The Ohio Credit Union Foundation (OCUF) is leveraging a $69,500 Innovation Grant from the National Credit Union Foundation (NCUF) to a consortium of Toledo-area credit unions and community organizations to charter a community development credit union for Latinos in northwest Ohio.

If the charter is granted, Nueva Esperanza (New Hope) Community Credit Union would be the first new state-chartered credit union in Ohio in more than 20 years.

Serving the Fastest-Growing Community

As the first Latino credit union in the state, Nueva Esperanza will reach out to a Latino American population that by all estimates has more than doubled since the 2000 Census. More than 50% of area households are classified as “low-income” or “extremely low-income.”

Meeting Basic Needs
According to Becky Hart, Executive Director of the Ohio Credit Union Foundation, these statistics point out the need for basic financial services and affordable credit within the community, which a credit union can provide.

During its first year, Nueva Esperanza Community Credit Union will focus on financial education, budgeting, basic savings, simple lending, credit counseling, and money transfers.

It will begin with two bilingual employees, then staff up to four bilingual employees in its second year.

Empowering the Community
“The Latino community is currently using a branch bank that offers no specific programs for small depositors, and charges fees for basic services such as money orders,” according to Barry Shaner, CEO of Directions Credit Union, which played an integral part in the foundation of the new credit union. “It is our understanding that area residents do not trust a financial institution that they don’t perceive to be an integral participant in the community.”

Nueva Esperanza’s mission will be “empowering the Latino community by promoting savings, increasing financial literacy among low-wealth and often unbanked Latino households, making loan capital available, and promoting community resources.”

Partners Laying Building Blocks

Toledo-area credit unions and community leaders met at Great Lakes Credit Union on January 16, 2009, to work toward the incorporation of Nueva Esperanza (New Hope) Community Credit Union. The startup is being partially funded by an Innovation Grant from the National Credit Union Foundation.

OCUF is proud to be partnering with a number of local credit unions and community representatives who have laid the foundation and building blocks of the credit union during the last several years:
 

►	Viva South Toledo Community Development Corporation purchased the building where the new credit union will operate, and will relocate its own headquarters into the same facility. Viva South Toledo will provide members with housing assistance and other social services to complement the credit union’s financial services.
►	Directions Credit Union will provide all data processing services, terminals, software, recordkeeping, and accounting support. Based in nearby Sylvania, Ohio, Directions Credit Union will also provide operational staff.
►	Area Financial Services, a technology CUSO owned by five Toledo-area credit unions, will oversee the new credit union’s back-office operations.
►	Latino Alliance of Greater Toledo will help grow and sustain membership in Nueva Esperanza Community Credit Union.

The Ohio Credit Union League and its Northwest Chapter will continue to serve as planning advisors and provide additional resources including education and training for the new credit union’s board and staff.

“Access to basic financial services is a necessity in every community,” said Jennifer Ferguson, CEO of Bay Area Credit Union and President of the Northwest Chapter. “The credit union’s presence in South Toledo will help residents achieve financial literacy, establish credit, grow savings, and possibly even realize the dream of homeownership. All of this will go a long way toward stabilizing families and building community pride. We know from working together on this project that the strengthening of South Toledo and its residents must come from within.”

Goal: Open for Business by June 2009
The credit union has applied to the Ohio Division of Financial Institutions for a state charter and has set a goal to open for business in June.

With its startup partially funded by an Innovation Grant from the National Credit Union Foundation, Nueva Esperanza (New Hope) Community Credit Union plans to open for business in this building by June 2009.

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The Ohio Credit Union Foundation, the philanthropic arm of the Ohio Credit Union System, supports educational and outreach initiatives that promote financial independence through credit unions. Credit unions are not-for-profit financial institutions owned and democratically controlled by their members. Ohio credit unions provide savings, loans, and other consumer financial services to their 2.6 million members. To learn more, visit www.OhioCreditUnions.org. For more information about this article, contact Ohio Credit Union League Director of Media Relations Patrick Harris at (800) 486-2917.