CHICAGO--Self-Help FCU, the California community development credit union which acquired Second Federal Savings & Loan in 2012, is officially reopening the failed southwest side thrift in conjunction with the city’s the Resurrection Project, as Second FCU.
Though several credit unions have acquired failing banks and absorbed them into their operations, this deal is unique as it marks the first time a credit union has acquired and revived a failing bank.
In an unusual alliance, Self-Help FCU, a $600 million affiliate of North Carolina’s Center for Community Self-Help, and the Resurrection Project bought the failing thrift’s 1,100, $161 million worth of mortgages from the FDIC, then acquired its deposits and three branches from Wintrust Financial Corp. in an effort to preserve banking services for the low-income Hispanic neighborhood where Second Federal operates.
Wintrust Financial’s Hinsdale Bank & Trust had acquired the $160 million of deposits and facilities, but not the mortgages, from the FDIC when the federal regulator took over Second Federal in July 2011.
The Resurrection Project has worked to revitalize predominantly low-income Hispanic communities on Chicago's southwest side since 1990 through a variety of community development initiatives.
Since February, TRP and Self-Help have been working together to make service and physical improvements to Second Federal’s three branches in Little Village, Cicero/Berwyn, and Brighton Park/Back of the Yards, while conducting community outreach to new and existing members. The credit union has also been working with distressed borrowers to help families keep their homes. It is also offering new products such as the Dreamer Loan, a $465 loan to young immigrants to finance their visa applications for the federal government’s Deferred Action for Childhood Arrival program.
Rudy Medina, who joined the thrift as a branch manager in 2009, will serve as president and CEO of the new credit union, which will be the state’s largest CDCU.
The new credit union is celebrating its resurrection Saturday with a cultural celebration including local food vendors, entertainment, children’s activities, and financial workshops.
The failed bank was unique because of its focus on the low-income Hispanic market. It was one of the pioneers in making home loans to undocumented immigrants who possessed taxpayer-identification cards. Many of those customers made their monthly payments in cash, which most mortgage providers aren't equipped to deal with.
Self-Help FCU is the second credit union formed by the North Carolina’s Center for Community Self Help, which includes a state chartered Self-Help CU based in Durham. The four-year-old California CDCU is a conglomeration of eight troubled smaller CDCUs. But this deal is its first outside of California.
