Tuesday, December 17, 2019

NY CUs Gain Access to State's Banking Development District Program

New York Governor Andrew Cuomo on December 12 signed into law legislation, S.727-A/A.3320, that will allow credit unions to participate in the state Banking Development District (BDD) Program.

The BDD Program was created in 1997 to encourage financial institutions to establish branches in economically distressed communities throughout New York where there is a demonstrated need for banking services.

Institutions that are approved for a BDD designation are eligible to receive up to $10 million in subsidized public deposits and other benefits, including below market-rate deposits from New York state. These deposits are intended to lower the financial risk that the branch may incur when opening in an underserved community.

The legislation will mark the first time in state history that credit unions will be permitted to receive public deposits.

Read the memo on the legislation.

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