El Futuro now part of Self-Help Federal Credit Union

On Tuesday, El Futuro Credit Union became Community Trust Credit Union in a merger connecting the Porterville institution with a growing network of Valley credit unions focused on assisting the financial needs of low-income communities.

The Community Trust Credit Union name adopted by El Futuro is part of the greater Self-Help Federal Credit Union (SHFCU) organization. This merger is the third within the last year for the federally-chartered institution.

SHFCU, established in 2008, is part of a larger non-profit organization which encompasses a number of financial organizations that work with low-income communities.

“This is simply a great opportunity to serve the many unbanked and under-served communities in the Valley,” Raul Pickett, Chief Executive Director of El Futuro, said.

El Futuro, like many credit unions, has been hit by the high unemployment and has slid downward from its January 2009 peak, when it recorded $8.5 million in assets.

Pickett called the merger a “very positive, strong move...that will give us the opportunity to grow.” El Futuro was originally established by a small group of local farmworkers in 1966.

That growth, according to SHFCU Managing Director of California Steve Zuckerman, includes a long-term plan of operating approximately 30 credit union branches throughout the state.

“Members are going to be able to go into nearly any large city and have access to our financial institution,” Pickett said.

Gregory Gillett, Chairman of the Board for El Futuro, said the emotional aspect of being merged into another credit union was quickly tempered by the realization of the similarity of the two credit union’s over-arching aims.

“They share our mission of serving the community,” he said. “The concept behind El Futuro when it was founded in 1966 was to progress and to provide access to its members, but also to grow with the community.”

Gillett said the opportunity to grow along with a rapidly expanding and financially solid credit union has provided the Porterville institution with an “extraordinary opportunity.”

As of September, El Futuro had about 3,000 members, according to data from the National Credit Union Administration.

“We were at the peak of what we could do without more support,” Gillett said.

Zuckerman said the most essential aspect of the merger for El Futuro customers is the infrastructure that SHFCU can provide, including assistance with online banking and more complex investments.

“It was difficult for [El Futuro] to grow,” he said. “They couldn’t offer all the products they would like to because of their small size.”

Two other California credit unions — Oakland-based People’s Federal Credit Union and the three offices of Bay Area-based Community Trust — merged with SHFCU in the latter half of 2008 and June 2009 respectively.

Zuckerman said the June merger concreted an “explicit decision” by SHFCU to focus on expansion in the Valley area.

“It was a market we wanted to focus on, partly because lower income communities of the Central Valley tend to be less well served by mainstream financial institutions,” he said.

In particular, El Futuro’s “expertise” in working with the needs of the Latino community was of interest to SHFC’s greater mission of serving low-income and minority populations, Zuckerman noted.

According to Zuckerman, a “historic reluctance” has kept many of those in many Latino communities from working with traditional financial institutions.

This, he said, increases the importance of partnering with a credit union well versed in the particular needs of the community, whether it be language accessibility or accounts tailored to a fluctuating income level for agricultural laborers.

The financial crisis left many credit union customers without employment, or with low employment, reducing the net worth of many of those institutions.

“Community credit unions were likely to get into financial trouble during the crisis because they are lending to low income families that are more likely to lose their jobs — not because of mismanagement,” Zuckerman said.

Earlier mergers with the credit unions in the Bay Area provided assurance that SHFCU intended to forward a common goal of serving working class members in California communities, Gillett said.

“We were the oldest Latino credit union in the nation,” he said,” and they are like our sister institutions.”

Over time, Zuckerman said, the merger will mean additional resources to automate more processes at the credit union, which will allow staff to devote more of their time to member services.

Specifically, options like online banking, 24-hour telephone support and an expanded list of types of loans offered will eventually be available to customers.

He foresees real estate and small business oriented lending taking place, in addition to the traditional personal and auto loans currently on tap.

The financial support and influence wielded by SHFCU will allow El Futuro to expand its reach to greater numbers of low income and Latino customers in the Valley, Pickett said.

“To be able to serve more people from those communities has been my dream, and now we’re going to able to do it,” Pickett said. “It’s something El Futuro can’t do by itself.”

-- Contact Sarah de Crescenzo at 784-5000, Ext. 1045, or sdecrescenzo@portervillerecorder.com.