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N.Y. Mayor Bloomberg backs CUs depository choice
ALBANY, N.Y. (1/22/10)--New York Mayor Michael Bloomberg expressed his support for the deposit of public funds into credit unions during his State of New York City address Wednesday afternoon. Currently, only commercial banks in New York can accept municipal deposits. “With Albany’s approval, we’ll also strengthen neighborhood-friendly credit unions, which reach out to customers who may have never had a bank account,” Bloomberg said. “We’ll seek to deposit $25 million in city tax dollars in federally insured and regulated credit unions. It’s a relatively small amount of city resources, but it will have a big impact by allowing credit unions to make more loans to more low-income families.” The Credit Union Association of New York applauded the mayor’s support. “We applaud Mayor Bloomberg for his support of credit unions and recognize his leadership to achieve enactment of the necessary state legislation that will allow municipalities to have depository choice,” said William J. Mellin, association president/CEO. “Credit unions are well-positioned to play a more prominent role in the economic revitalization in New York City and to provide enhanced services to New Yorkers, especially low-income families,” he added. “As New York City works toward the goals and vision outlined by Mayor Bloomberg, we will explore every opportunity to partner with him to achieve those goals.” Allowing credit unions to accept municipal deposits would increase competition for the funds, and produce lower fees, better loan terms and higher deposit rates for local governments, the association said. Bloomberg also indirectly mentioned five community development credit unions that will be offering “NYC Safe Start” accounts, which aim to prevent overdrafts, according to the National Federation of Community Development Credit Unions. The credit unions are: Bethex FCU, Bronx; Lower East Side People’s FCU, Manhattan; Brooklyn Cooperative FCU; Neighborhood Trust FCU, Manhattan; and Union Settlement FCU, Manhattan. The mayor also noted a recently chartered credit union in Queens, sponsored by the East River Development Alliance--one of two new federal charters in 2009. The federation helped charter the credit union, which will serve thousands of public housing residents. National media, including The Wall Street Journal and The New York Times, also have covered Bloomberg’s speech. The Huffington Post proclaimed that New York had “moved its money,” a reference to the Post’s campaign for consumers to move money from big banks to credit unions and community banks. Last week, New York Gov. David Paterson called for action to expand municipal depository choice as part of his mandate reform agenda. City groups, including the Association of Towns, New York State Association of Counties, New York Council of Mayors, Firemen’s Association of the State of New York, Albany Common Council and the New York City Common Council, are submitting resolutions in favor of depository choice.


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