powerpoint presentation - inclusiv...depicting rationale / benefits of becoming a cdfi\爀屲dc fcu...
TRANSCRIPT
Mission &
Margin
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Outline: Slide 1: Introduction to Presentation Slide 2: History and rationale for pursuing a CDFI mission of financial inclusion Slides 3, 4, 5, 6: Current challenges and approach Slide 7: Member demographics & segmentation of vulnerable populations Slide 8: Structuring response thru products (left); leadership (right) Slide 9: Impacts by vulnerable pop segments Slide 10: Financial results Slide 11: Close
Why CDFI?
Mission
Network
CapitalProducts
Capacity
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Depicting rationale / benefits of becoming a CDFI DC FCU chartered in 1954 to create affordable access to credit by DC govt employees as alternative to predatory lenders = mission of financial inclusion CDFI = Recommitting to Mission of Financial Inclusion. CDFI designation in 2009 First Benefit = Expanding our Network to Inc Other CDFIs, Community Based Organizations, Public agencies – goal of community development Access to Capital from the Fund (DC FCU is three time grant recipient) but also other important forms of Capital = Partnerships that provide for Human and Reputational Capital Rethinking our Financial Products to serve LMI consumers. Business opps in filling gaps in the financial market. Partnerships! Capacity is about bringing it back home; empowering our staff AND members to attain more.
There is great economic inequity in
Washington, DC
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Our CU not only was born of a need to reduce inequity through financial inclusion; that inequity remains today and the gap may be greater as the cost of living, the cost of RE continues to rise in the city. Financially Fit DC = public policy agenda of inclusion.
Financial education alone is not enough to
create opportunity
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Predatory lenders and unregulated financial service providers abound. Educate but equally important to deliver the financial tools to execute on that education.
Financial products and credit that respond to our members needs
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Public / private partnerships to ensure that we can reach and serve vulnerable communities with products that are suitable and responsible.
Access to quality services – when
and where they are needed
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We believe that access is key. We leverage three Branch locations and several ATMs, w shared branching opportunities and technology to increase that access / self service Partnership sometimes includes non-traditional partners like Citibank to inc availability of free ATM transactions for our members.
Financial Inclusion is key for community
development
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We believe that Financial Inclusion is Key for Community Development, and continue to honor our legacy of service to DC’s employees and residents by ensuring the most vulnerable have a great place to grow: 1st – Those living paycheck to paycheck. Shopping thrifts and simply wanting to make ends meet. 2nd – The young entering the job market – banking MBSYEP 3rd- New Americans, including those with foreign documentation,
Invest
Participate
Advocate
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As we think of those most vulnerable, those for whom we’re creating inclusion, we consider where their priorities (their dreams) fall within this wheel and how best to coach and match to appropriate financial services. You can think of each segment in the wheel as a combo of development services tied to impact products and services. We also think of who else in the public private sector to link up with to ensure we reach as many folks as possible. As a result, DC FCU’s role becomes three-fold: to invest (in coaching and other development services, in creating access points, etc); to participate in community development initiatives that strengthen our city (partnerships); and to advocate for those issues that create barriers to building financial capability by all (affordable housing, first accounts, etc)
Results of Impact Driven Initiatives
Lending to the Credit Challenged: 12.87% Net Yield on D, E segments of Consumer Loan Portfolio
Banking Youth: 7% of Current Members are under the age of 24.
New Americans: 20% of Current Members are Latino immigrants; $8M in Savings; $6.5M in Outstanding Loans
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Executing on a Mission of Financial Inclusion is not only good work but also good business. Results tie back to the three vulnerable populations already introduced – those living paycheck to paycheck (who not always make the best credit choices); youth from MBSYEP; New Americans or Latinos. Lending to the Credit Challenged: Impact area Debt Consolidation and Emergency Loans Banking Youth: Workforce development; Credit Building New Americans: affordable home mortgages, credit building
As of 9/30/16 As of 6/30/18 Peer*
Net Worth/Total Assets 10.90% 11.08% 11.46%
DQ Loans/Total Loans 1.78% 1.43% 0.84%
Total Loans/Shares 77.25% 79.57% 63.36%
Return on AverageAssets
0.92% 0.97% 0.53%
Operating Expenses/Gross Income
71.08% 68.77% 76.75%
Source: NCUA’s KFPRs
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DC FCU is a $63M FI. Peers are $50-100M in assets. From a financial performance perspective, these Key Financial Ratios presented to our Board at our last examination report also demonstrate solid and above average results than peers.
Charlotte Ducksworth, Board Chairdccreditunion.coop 877-784-5551