5 unique ways credit unions are helping during coronavirus

April 14, 2020 5:00 AM

The coronavirus pandemic has quickly reshaped much of American life and, in turn, the credit union industry.

Credit unions have had to do everything from giving members access to branches only through drive thrus or by appointments, putting hiring plans on hold and moving important meetings to online.

Nonessential businesses have been closed and economic activity has significantly slowed. That’s led to record numbers of Americans applying for unemployment benefits.

To help soften this financial blow, Congress recently passed historic relief packages to get money into the hands of consumers and loans to struggling businesses. Paid leave benefits have also been expanded to cover many workers.

But a number of credit unions have also found their own unique ways to address the crisis and help their members and communities.

Read on for details of some of these examples.

Indiana CUs collaborate on housing resource guide

The Indiana Credit Union League has partnered with four other groups from the Hoosier State to put together a resource guide for housing-related issues during the pandemic.

Created in conjunction with the Indiana Department of Financial Institutions, Indiana Bankers Association, the Indiana Mortgage Bankers Association and the Indiana Apartment Association, the Eviction/Foreclosure Resource Guide aims to help homeowners and renters struggling to make their monthly housing payments, along with information on what to do if they are experiencing hardship.

The guide is expected to be updated on an ongoing basis as additional resources, information and guidance become available.

“During this public health emergency, housing stability has never been more critical,” Indiana Lt. Gov. Suzanne Crouch said in a press release. Crouch also serves as board chair of the Indiana Housing and Community Development Authority.

She added, “I would like to commend all the work and coordination at the federal, state and local levels and between public and private organizations to ensure Hoosiers can remain in their homes.”

While much of the document is directed toward renters, it does encourage consumers to “check in with your mortgage lender” if they need payment assistance.

“We are pleased to have participated in this guide, and to cooperate with other state-level organizations to help consumers get answers to the common questions they have,” ICUL President John McKenzie said in a press release.

SECU pledges millions

Mike Lord is president and CEO of State Employees Credit Union in North Carolina

State Employees’ Credit Union in Raleigh, N.C., and the SECU Foundation have committed to donating up to $10 million in COVID-19 disaster relief efforts across the Tarheel State.

The credit union and the foundation have each pledged to donate up to $5 million, and the combined total is among the largest donations the industry has announced since the pandemic began. The funds will help nonprofits in the state provide food, closing, shelter and financial assistance for those in need during the outbreak.

The donation will also support medical staff working on the frontlines of the crisis.

“With such a sizeable commitment, we will be able to partner with many top-notch service providers who make a difference in the lives of North Carolinians every day," SECU President and CEO Mike Lord, pictured here, said in a press release. "We will distribute funds where the need is immediate using structures already in place to provide the assistance. The credit union and foundation are united in aiding our communities. We are here to help during this challenging time.”

Bob Brinson, chair of the SECU board, said, “COVID-19 has presented a huge economic challenge for many North Carolinians. We understand the financial struggles many of our members, families, friends, and neighbors are facing — the needs are tremendous. SECU cares deeply about the financial and physical welfare of our 2.5 million members and the people of North Carolina. We are grateful for all those on the front lines serving individuals affected by this crisis – we are confident that these donations will not only help provide essential needs and services in our local communities, but will provide North Carolinians with the hope that together, we will make it through this difficult time.”

Public-private partnership

Arpad Benedek

VyStar Credit Union has teamed up with its hometown of Jacksonville, Fla., to provide loans to local small businesses.

The $9.1 billion-asset credit union will provide loans up to $100,000 at a 5.99% annual percentage rate and will waive the $250 underwriting fee on loans less than $5,000, according to information on VyStar’s website.

VyStar is not currently participating on the Small Business Administration’s Paycheck Protection Program due to “significant delays that all lenders are experiencing with this program,” the institution said on its website.

“These delays have been caused by technical issues, unclear standards and manual underwriting by the SBA. We will resume taking SBA applications when that system is restored,” VyStar added.

The city of Jacksonville will provide a number of financial perks for borrowers in VyStar’s program. It will cover the $250 underwriting fee for credits over $5,000 while also providing $1,000 in grants to the first 3,000 businesses that get a loan through the program, according to the institution’s website.

The city is also covering interest payments for the first year for all borrowers and will provide grants to cover interest for the second through sixth years for businesses that keep at least half of their pre-pandemic staff. If a business maintains its entire pre-coronavirus workforce, then Jacksonville will pay 10% of the principle amount each year, up to 50% of the original loan amount.

The city anticipates contributing between $20 million to $30 million through the program, according to VyStar’s website.

Businesses must meet certain criteria to be eligible, such as having a physical presence in Duval County where employees work and no more than 100 workers.

The program was approved by the Jacksonville City Council last week.

Making the crisis personal

Brett Noll, CEO of Securityplus Federal Credit Union in Baltimore, has addressed the pandemic with an unusually impassioned plea to members to follow the recommendations of hand washing and social distancing.

Noll started the letter to members, which was posted to the $394 million-asset institution’s website, by acknowledging it “has nothing to do with operations” and “is more personal.” He described the experiences of his neighbors who are respiratory clinical specialists. He said one of the neighbors had been working 12-hour shifts, six days a week.

Noll said the neighbors have to wear protective gear that is "extremely hot and very uncomfortable." One neighbor described his favorite part of the workday as when his shift ends, and he can take off that equipment to get his "first wonderful breath of clean, fresh air outside his hospital," according to Noll's letter.

Noll said he decided to write the letter to Securityplus members after his neighbor seemed to be desperate for people to follow social distancing guidelines.

Noll wrote that, "I felt compelled to use the little reach I have to plead with you to follow the guidance of washing hands, practicing social distancing, and staying home. I'm certain I'm preaching to the choir for many, but it can't hurt.”

Noll asked members to help healthcare workers by speaking with others who maybe aren’t following recommended guidelines or by showing them videos of the ongoing problems in Italy and New York City, where the coronavirus has been especially bad.

“As many of us struggle battling boredom, healthcare workers battle to save lives,” Noll wrote. “Let's help these incredible people who have put their lives on hold, and on the line, for all of us. The sooner we do this, the sooner we will all take a breath of fresh air from a world that is starting to get back to the normal we used to know.”

Donating critical medical supplies

Phoenix-based OneAZ Credit Union has donated 40,000 N95 respirator masks to the intensive care unit at Banner Desert Medical Center where patients diagnosed with COVID-19 are being treated.

The masks, which are the only facial covering guaranteed to protect medical professionals from the coronavirus, are in short supply. Some medical facilities have needed to find ways to sterilize and reuse N95s and other masks due to a shortage of personal protective equipment.

A press release from OneAZ said the credit union established a stockpile of the masks beginning in 2009 in preparation for the H1N1 bird flu pandemic. Before donating them to Banner Desert Medical Center, the credit union reached out to manufacturer 3M to confirm the masks in storage were still effective.

Once confirmed, OneAZ representatives reached out to the medical center and donated 40,000 masks, which “were identified as being above and beyond the credit union’s current and projected needs,” according to a press release.

“Our first priority is the safety of our associates. Once we confirmed that supply, our focus shifted to the medical community — where we have been looking at every way possible to make a positive impact during these uncertain times. We believe Arizona will come through this stronger if we all work together for the greater good,” OneAZ CEO Kim Reedy said in the release.

Andy Kramer Petersen, president and CEO of the Banner Health Foundation, said, “We are so thankful to OneAZ Credit Union for this generous donation of N95 respirator masks for our health care workers on the front lines of the COVID-19 pandemic. In these difficult times, support from local businesses and our community is helping Banner Health in so many ways as we work to keep our patients and our health care workforce safe. We applaud and thank OneAZ Credit Union for being such a generous partner.”

OneAZ has also committed $200,000 to COVID-19 community impact grands for nonprofits in the region.

A photo of the boxes of masks the credit union donated can be seen here.