Comment Detail

Comment

I have been in the credit union industry since 1977 and each institution that I’ve worked at were either already a member of the Federal Home Loan Bank of Indianapolis or I immediately opened an account and began using FHLBI’s services. To me, the Federal Home Loan Banks and credit unions are inextricably tied together as our missions align, especially as we both aim to serve our members by promoting affordable products. During my career as a CFO, I’ve had to navigate my credit union through all kinds of economic conditions and rate environments, some more challenging than others. But through it all I knew I could rely on FHLBI for expert guidance as well as appropriate products.

I’ve been at my current credit union, People Driven CU, for 8 years and until recently was flush with cash so didn’t need a lot of FHLB products. I did move all of my safekeeping to the bank 8 years ago which simplified my month end investment settling and balancing. Also the safekeeping desk has always been so easy to work with. I knew I could count on them to help whenever I had a balancing issue. As our members have begun to borrow more now that the pandemic is easing, recently our loan engine has started to take off. To fund this loan growth, I borrowed for the first time and feel like I got a terrific product. Again, the experience was made easy, this time by the expertise of the credit group. Although I have other options for borrowing, I chose the Home Loan Bank because of the product. It fit not only my term needs but also the rate was very competitive. Both of these parameters are important to me as I manage the credit union’s balance sheet and maximize our earnings.

In addition to borrowing for the first time, PDCU is also developing/creating a new mortgage department. We hired a VP of Mortgages and she attended a MPP workshop, learning about the grants offered by FHLB. The one that spoke to her was the NIP (Neighborhood Impact Program). This provides grants of up to $7,500 to help low-moderate income homeowners with home repairs. To qualify for the grant, the household must be below 80% median income, owned and occupied the home at least six months prior to applying, be current on their existing mortgage obligation, and the home must be a single-family home, condo, or modular unit. We feel many of our membership base will meet the qualifications for this grant. Ultimately we were approved to participate in the Mortgage Purchase Program which will be a good alternative to the secondary market for PDCU. We were looking for the ability to sell loans as needed and the MPP allows us to pool with other FHLB members resulting in better pricing. MPP will give us an outlet to generate additional income while maintaining balance sheet flexibility and managing interest rate risk. I like the simple pricing structure, competitive pricing, and the ability to select either servicing retained or released.

Finally FHLBI offers many educational, training, and networking events, not to mention the annual symposium that I have attended as have several of my colleagues.

Making certain that PDCU remains a strong, viable credit union helps our existing members and also makes us more attractive to the communities that we serve in SE Michigan. Partnering with the Federal Home Loan Bank of Indianapolis is a great way to accomplish this.