Here at Bernalwood, we see it as part of our civic duty to pass along information about worthy neighborhood institutions that could use a little help. Most of the time, that means lending a hand to volunteer nonprofits or mom-and-pop businesses. But today we bring news of a struggling local institution that’s an unlikely candidate to pass around the hat: the Mission San Francisco Credit Union.
It seems the credit union, which is headquartered on our stretch of Mission Street near 29th, made some real estate loans that went bad. So now it needs donations — NOT deposits — to continue operation.
A financially troubled San Francisco credit union is trying to stay afloat by doing something very unusual — unheard of really. Mission S.F. has started a fundraising campaign with the goal of raising $200,000 and many in the community believe it is essential that this credit union survive.
Mission San Francisco Credit Union opened its doors in 1971. Roberto Hernandez is a board member who says the credit union approved small loans the big banks would never consider. […]
However, the nation’s economic downturn has hurt them and capital reserves are low.
“What we really need is donations, it’s not deposits, but donations that we could put straight into capital that would enable the credit union to continue as an independent financial institution,” said Margaret Libby from Mission S.F.
There’s a video segment about the credit union’s plight right here.
UPDATE 12 Feb, 2011: My former sensei, Lydia Chavez from Mission Loc@l, has additional insight on the situation, including the possibility that the credit union may be forced into a merger:
The federal TARP program stepped in to help failing banks, but has done nothing to assist the smaller credit unions that traditionally serve lower-income clients. Recently, they said, regulators had made it even more difficult for the credit union to overcome its current problems.
“Right now that’s what change is — we’re under a much tighter regulatory structure,” said [board treasurer Dave] De Graff. “In the past we were given more time.”
Mission SF’s total outstanding loans grew substantially over the last 10 years, while its membership numbers have fallen. In 2000 it had 2,782 members and outstanding loans of $3.8 million. By June of 2010 outstanding loans had risen to $5.7 million, but they peaked in September 2008 at $7.9. Membership had declined to 2,426 as of September 2010.
Although 10 percent of Mission SF’s second mortgages and 10 percent of its first mortgages could be considered troubled, De Graff said the bank’s portfolio of 129 car loans was doing well.
It’s unclear what will happen over the next few weeks. There were three assisted credit union mergers in 2008, 10 in 2009 and 10 in 2010, according to federal regulators.