Welcome to the 2011 NCB Annual Report

A Letter from the President

Telling Our Stories

NCB is a proud sponsor of the 2012 International Year of Cooperatives, the first-ever global initiative launched by the United Nations to showcase the benefits of the cooperative business model for improving the welfare of communities across the globe. The campaign's stated aim is to underscore how "cooperative enterprises build a better world." In keeping with this purpose, the organizers have put out a call for those engaged in cooperative business ventures to come forward and tell the story of their involvement. Many of us who believe in the remarkable efficacy of cooperative principles have a tale to share. Mine is quite simple. It is the story of an epiphany, an accidental conversion to the cooperative way of conducting one's affairs.

Before I came to NCB I was controller of Temporaries Incorporated, a large manpower agency that had established a credit union for its workers because it was difficult for them to obtain financing through the usual channels. When I took over as president of that credit union, one of my first decisions was whether to grant a loan to a working single mom who was about to be put out onto the street and needed money for a deposit on an apartment. After checking with her counselor, who assured me "she is a really good worker," I trusted my instincts and green-lighted the loan. She proved me right by repaying it in a timely manner. Yet what really impressed me was that she returned faithfully to my office every month to thank me for what I had done. That simple gesture of gratitude affected me deeply. I realized that, by taking the time to understand her circumstances and follow through on her request, I had greatly impacted not only her life but the life of her daughter.

The satisfaction that comes from being able to have a positive effect on the fortunes of others continues to this day – whether it is making a loan to an entrepreneur for expanding a business or to members of a consumer-owned grocery store wanting greater access to produce and food selection. Whatever the purpose of the financing, it all comes down to enabling people to overcome obstacles and pursue their aspirations. For me, this is the power of cooperation. And I owe much to the gratefulness shown me a long time ago by a woman seeking a credit union's help to deal with a difficult situation. It was the moment I realized that I wanted to put this way of doing business at the center of my life.

During this International Year of Cooperatives, stories like mine are being collected from every corner of the globe to make tangible how cooperation can change lives for the better. To see what has already been submitted or to upload your own story, go to www.stories.coop/tell-your-story. And for additional information on the International Year of Cooperatives, visit www.2012.coop.

This UN-backed campaign on behalf of cooperatives is a cause for celebration and a validation of the vital contributions cooperatives make to economies around the globe. According to research conducted by the UN team, cooperatives are on track to become the fastest growing business model by 2020. In the U.S. alone, member-owned organizations account for $3 trillion in assets, $500 billion in revenue and more than one million jobs. A growing trend is for many of these businesses to collaborate. In doing so, they are able to multiply their capabilities, strengthen their effectiveness and come up with collective solutions for the challenges they face.


An example of what collaboration can achieve is NCB's recent work with Iowa's credit unions. In 2010 the state's corporate credit union announced a business strategy to wind down their business and terminate vital banking services its credit union members relied on to manage their organizations. As a result, credit unions scrambled to find a financial institution capable of providing what they were about to lose. They looked for a financial institution not only able to deliver correspondent banking services but also one that understood the intricacies of serving member-owned organizations. After months of town hall meetings, discussions and soul searching, they arrived at their decision. The Iowa Credit Unions announced it had chosen to partner with NCB, and, in a show of support, 102 of 127 credit unions said yes to the newly developed correspondent banking solution. These credit unions, representing some 800,000 Iowans, are now able to obtain numerous products and services more economically than they could access individually. The offerings include deposit accounts, cash management services, settlement with the Federal Reserve, item and card processing, international services and credit facilities.

Our success with Iowa credit unions is only one instance among many of NCB's strengthening relationship with the credit union community nationwide. In 2011 alone, NCB sold more than $400 million in loans to credit unions. We also continue to collaborate with the National Credit Union Foundation (NCUF) and its philanthropic Community Investment Fund (CIF) program. NCB created a CIF deposit account whereby all or part of the interest earned on the account is donated to NCUF initiatives across the U.S. in support of financial literacy, cooperative education and community development.

Our partnership with NCUF as well as with other credit union organizations complements NCB's mandate to help underserved communities and cooperative enterprises help themselves. And I am pleased to report that 2011 was a successful year for our mission banking programs, carried out in strategic alliance with NCB Capital Impact. In total, we committed and deployed $490 million in low and moderate income communities, up from $374 million for 2010. This capital infusion was provided through a combination of direct lending, investments, the facilitation of creative transactions and select national initiatives.

With 2012 designated the International Year of Cooperatives and with a concomitant special focus placed on the role of cooperatives in building a better world, I look for even greater backing for the mission-related programs we have created and support.

Seeing Results

Last year I characterized 2010 as a "rebuilding year" for NCB. Now we are experiencing the benefits. 2011 has proved to be a year of great progress for the Bank. Deposits rose significantly. Cash reserves grew. Lending to our customers strengthened. And our financial performance markedly improved.

The positive trends of 2011 have carried over into the first quarter of 2012, a sign that our customers are beginning to feel more optimistic about the future. As a cooperative financial institution, we do only as well as our members do. Thus, NCB's encouraging performance numbers may reflect the start of a welcome turnaround in the economy as a whole.

What we achieved in our core market of cooperative housing for 2011 perhaps reflects a market beginning to emerge, albeit tentatively, out of recession. As the bank of choice for many housing cooperatives across the country, in 2011 NCB arranged more than $186 million in new residential loans for 823 co-op unit owners and more than $654 million in co-op building financing for 223 communities. That amounts to total financing of over $840 million, compared to $724.1 million for 2010.

Gaining Visibility

For a long time, I have felt the cooperative model of doing business has not gotten the recognition it deserves, especially given the vital contributions member-owned and member-controlled businesses make to the economy. Therefore, to help shine more light on the remarkable accomplishments of cooperatives, two decades ago NCB began publishing Coop 100, the only annual report of its kind, announcing the top one hundred cooperatives in America.

More recently, the International Co-operative Alliance, an independent, non-governmental organization developed an online database, called Global 300, patterned after our Coop 100 publication, to catalogue cooperative activity internationally. There you will find listed the biggest cooperatives abroad.

Through these two reports, the public profile of cooperatives has gained added visibility. But the effort to raise awareness will receive its biggest boost during 2012 as the International Year of Cooperatives unfolds.

I've often called the cooperative model of doing business one of the world's best kept secrets. A cooperative focuses primarily on its members and not necessarily on spending heavily for the kinds of publicity and advertising so common among for-profit enterprises. This is why we should welcome the opportunity given us by the International Year of Cooperatives to bring added attention to what we have done and the potential for what we yet can do.

It is a time when all of us can participate and join voices in support of cooperation as a highly adaptable model for working in tandem with others to achieve goals and improve the welfare of communities at a very local level. This is definitely a cause worth shouting about.

Charles E. Snyder Signature

Charles E. Snyder
President & CEO, NCB

© 2011 National Consumer Cooperative Bank. All rights reserved.