PHOENIX (7/11/12)--The city of Phoenix will invest up to $50 million with local financial institutions, including credit unions, through federally insured deposits, city officials said.
The financial institutions must be Arizona-chartered or have a physical presence in Maricopa County, in which Phoenix is located (Tucson Citizen.com via Arizona Republic News July 10).
Phoenix is the most recent city to join several other municipal and state governments that have looked to credit unions and community banks in the aftermath of the financial crisis, the newspaper said.
Credit unions in several states are increasingly accepting municipal deposits from city and town governments. More states are trying to pass laws to obtain that capability. Many municipalities are not aware they can use credit unions as depositories. Education is a key focus of credit unions that do accept these deposits, said several credit unions that offer the service (News Now June 29).
Phoenix officials told the newspaper they aim to help local financial institutions provide them with capital to fund loans to local businesses and individuals. The city mainly invests its money in U.S. government securities, the paper said.
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