CDFIs Get $250-$500K Deposits Through California Dept of Insurance COIN Program

July 10, 2012 at 3:48 pm

Self-Help FCU, an affiliate of the Durham-based Self-Help Credit Union, was one of three Community Development Credit Unions (CDCUs) in California to recieve a total of $1.25 million in interest-free deposits from CUNA Mutual Group, an insurance provider for credit unions.

These deposits, which are between $250,000 and $500,000 per credit union, was made through the California Department of Insurance’s California Organized Investment Network (COIN) program. This is a unique initiative aimed at increasing the insurance industry’s investment in the state’s underserved areas, in exchange for a state tax credit. Annually, the COIN program provides $2 million in tax credits that support $10 million in investments. The companies make their investments in Community Development Financial Institutions (CDFIs). All three of the CDCUs that were awarded CUNA Mutual’s deposits are both CDCUs and certified CDFIs. The tax credit is worth 20 percent of the investment made.

As of 2009, $14.3 billion had been invested in over 4,000 separate investments through the COIN program. The types of projects that COIN investments support include affordable housing, mixed-use development, and geographically targeted real estate, commercial, and business investments.

North Carolina needs a program like this. Our state’s CDFIs and CDCUs need investments in order to expand their capacity to provide services within their communities. The COIN program serves as a model for creating long-term strategies for economic development that involve state agencies, industry leaders, and local financial institutions. These kinds of strategic partnerships are needed in order to leverage public and private resources to strengthen low-wealth and underserved communities.

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Entry filed under: CDFI, Credit Unions, Economic Development, Housing. Tags: , , , .

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