The CU De Novo Collective Foundation announces the launch of the Louise Herring Fund to Support New Credit Union Charters

Today marks a significant milestone in the credit union movement with the establishment of the Louise Herring Fund. Named in honor of Louise Herring, a pioneering advocate for the credit union movement, the fund aims to support the creation and growth of new credit union charters across the United States.

"Establishing the Louise Herring Fund is a tribute to Louise’s enduring legacy and her unwavering commitment to financial democracy and community service," said Denise Wymore, President/Chairman of the Board of the CU De Novo Collective Foundation. "We are dedicated to carrying forward her vision by empowering new credit unions to serve their communities, especially those that are underserved by traditional financial institutions.”

Denise sat down with our Host Sarah Snell Cooke to break the big news - Watch the video! —->

Louise Herring, often referred to as the "Mother of Credit Unions," dedicated her life to promoting the principles of cooperative finance and ensuring that credit unions served the financial needs of their communities. She started over 500 credit unions in Ohio and became the Ohio Credit Union League’s first managing director. In 2022, she was inducted into the America’s Credit Unions HerStory Exhibit.

This fund, inspired by her legacy, seeks to provide financial assistance, resources, and expertise to help new credit unions thrive in today’s competitive marketplace.

The CU De Novo Collective Foundation is committed to fostering financial inclusion and community empowerment by supporting the establishment of new credit unions. The foundation’s core objectives include:

1. Financial grants and funding: providing start-up grants and seed funding to new credit union charters, ensuring they have the necessary capital to launch and sustain their operations.

2. Charter application resources: By partnering with industry experts, we offer comprehensive support including consulting, mentoring, technical assistance, loaned executives, sample policies and procedures, and initial training programs for boards and executives. Our goal is to ensure that new credit unions have the tools and guidance needed to succeed from the outset.

“There are currently 63 applications for new charters at the NCUA, up from 51 the same time last year,” said Wymore. “By creating new credit unions, we are creating a new narrative in the fight against taxation. There is no better way to show the credit union difference than financial cooperatives pooling their resources to help fund new credit unions.”

To learn more or make a donation to the Louise Herring Fund visit www.cudenovocollective.org

The CU De Novo Collective Foundation is a 501c3 corporation. All donations are tax-deductible.

Read the full transcript:

Disclosure: Transcript is automatically generated

Sarah Cooke 00:03
Hello. Welcome everybody to The Credit Union Connection. I am here with the no-need-for-introduction Denise Wymore. Welcome, Denise, how are you doing today?

Denise Wymore 00:13
Good. Thanks, Sarah, you're looking great, Grandma.

Sarah Cooke 00:16

Um, so I, we've been talking a lot. I actually, I'm going to let you start with your story, because that'll kind of segue into what I was thinking. Yeah. I don't think a lot of people know how we know each other, how the De Novo Credit Union Collective got started. Yes.

Denise Wymore 00:36

So it was kind of interesting, because the first time I ever met you in person and Randy Carnes in person, Sue Mitchell asked me to facilitate a discussion panel at the Underground. And I think it was Money 2020 in Las Vegas. Wasn't it like, yeah, which is coming up again. And I never met you guys. You know, I met you ahead of time. I remember the conversation about who was going to go first between you and Randy, but I'm on Randy was going first, Oh, yeah. And then, you know, did I know how to, like, kind of moderate that? And I was up for it. But Randy said something that I will never, ever forget, will change the whole course of my my life, honestly. He said, in any industry where there are no new entrants and there is a massive consolidation of the existing entities that that signals the beginning of the end of that industry, and that's what's happening to credit unions. And I remember sitting there on stage, and it was seriously a moment of "Wait, what?" And I couldn't really have that moment on stage, so I had to bury it. But as soon as I could, I was looking into like, how is it we're not starting new credit unions? And I guess I assumed that, you know, we were like, that was somebody's job. And so what I what I did was I got connected with some groups that tried and failed, tried and bailed and a couple that actually made it happen. And through that process, we kind of identified the hurdles to that. And we originally called ourselves like this De Novo support group. And it was a group of like three De Novos, three groups of people that were trying to start a credit union, and they were all involved in credit unions, which was kind of unique. And so they were all lamenting about the process, and we were all kind of learning the process, and we were all kind of bitching about it and everything, and and then one meeting, I said, You know what? Instead of bitching about it constantly, let's just do something. Let's let's do something. Let's fix it. Nobody's going to fix it for us, right? Let's get some shit done. So we came up with the name this year, De Novo Collective. We got ourselves a website, and then we launched the idea at the Underground in, also in Vegas, and it was a kind of the weird Covid one, where we had to broadcast live. Remember that one? So we launched, officially launched the CU De Novo Collective website at that Underground, and that was an interesting one, because that was in conjunction with a CUSO. So then I'm standing in the hallway, and someone came up to me from a large credit union and said, I love the CU De Novo Collective idea. We'd like to give you, we'd like to support you. Can we give you money? We weren't thinking about money, you
know. And so then I was like, Yeah, I want your money. But I said, Well, you know, let me get back to you. So I called Brian Witt. You know Brian Witt? Yeah, I've known him for years. Brian started this CU De Novo Collective. People want to give me money. What do I do? He goes, we need to form a foundation. How do I do that? I can help you. I think he does a lot of lot of league foundations and everything. But I knew nothing. You know about 501 c3 application
took a very long time. Anyway, finally got the 501 c3 with the a purpose of raising money for grants to help start new credit unions, it's kind of the primary focus at CU De Novo Collective. But in the process of launching this website and kind of raising awareness about the disappearance of the movement, was kind of the overall scorecard. If you look at our main page, it's really a scorecard about what's happening, both the number we're losing and the few that we're starting. Uh, John Hernandez came out, joined our group with the caveat that we also should focus on, how can we, you know, save small credit unions so and we, we were in the process with the 501, c3, and actually changed it so that we could provide money for both sides. But we're focusing right now on starting new credit unions. And I'll tell you why. Sarah, I know you let me write for your publication. I really appreciate it so I can write about my passion for small credit unions and and starting new ones. And if you look at the last eight, I wrote that article, did really well. When I went to write that article about the last credit union charters, it was just going to tell stories. I remember I told you this. What I didn't expect to find and what I wasn't even looking for, but what I discovered were the last eight were minority-lead. You know, seven were black-lead, and the other was Native American. And so when I looked at all their press releases, and I started really like, I want to tell their stories, they all had a similar thread. They weren't being served by traditional banking or credit unions. Many were stuck in the cycle of payday lending and needed to get out, and they discovered that the best way to do that is to pull their resources. I'm reading these stories, and I'm like big crocodile tears, because I'm thinking they are retelling the story, origin story of credit unions in America, and they're telling it to us exactly

Sarah Cooke 05:42 yes, 100 years later.

Denise Wymore 05:45

And I'm like, oh, gulp, that's amazing. So we decided, okay, we need, we need to really help get these charters going. We've been working with the NCUA to make the process easier. And I'm not going to go into all the details about that, but let me just say, we've had several people step up and volunteer a lot of time resources. CU Policy Pro, I do want to give them a shout out. They're a big one. They give access, free access to all the CU Policy Pro, policies and procedures online for the De Novo applications. Huge time saver. I know four groups that have already taken them up on that. But we also have the issue of creating more templates for business plans, marketing plans. And I'm working with the group AUX, A.U.X., and if you know AUX and Diane and the, and the gang, they are helping us with that. So we're getting all of this pipeline. We're getting basically a really robust template so that when a new group comes in, they don't have to go it alone. Currently, they're staring at a blank piece of paper saying, write a business plan. So we crack the code on that, and then the big hurdle is raising that capital, right? And so our foundation, what's unique about it is that, given, there was no entity where people could donate, so that they could get a tax deduction for a capital infusion to a credit union, because technically, capital has to be a donation. It's not repaid. There's no investment. You know, it's 100% donation. But there's nothing that says it can't be a donation through a proper 501, c3 which is basically, you know what, what we created. So we are launching on the 90th anniversary, the 90th anniversary of Estes Park, the famous Estes Parknmeeting the Louise Herring Fund to raise money to start new credit union charters. And the reason we chose Louise Herring, mother of credit unions, for those that don't know, she started 500 credit unions.

Sarah Cooke 07:53
You would think we could get one going, right? Just what?

Denise Wymore 07:56

Gosh. I mean, I knew about her. And to be honest, when I went to the when I went to the when I was inducted in America's Credit Union Museum, shout out to Stephanie Smith, amazing, she was on the wall with me, you know. And I remember, and they, you know, Dora Maxwell, I mean, these, these pioneers, these black and white photos of these women who, who we do talk about, but you don't really dig in and say, what would we be without them, right? And Louise Herring, she was also, I don't know the whole story, but I know her whole story now, youngest person at Estes Park. She worked for Kroger, and she started Kroger Credit Union before even Estes Park, and they decided she should represent Ohio. They're on a train to Estes Park, and there's a woman that's taking like, roll call. You know, it's a public train, making sure everybody is on that train. And she couldn't find this woman, Louise Herring and she was like 23 year old kid, and she dismissed her thinking, you know, this young kid can't possibly be with us. Well, when Louise identified herself kind of here, I guess Roy Burchingeren was pissed that they sent such a young person. I love that part of the story too, because, you know, we kind of like, ooh, Roy, but not cool dude. And so she ends up being like the secretary of the Estes Park. And then goes on to, you know, start 500 credit unions, including founding the Ohio Credit Union League. And she helped to found the Kentucky and, I think, the Michigan League, and just for fun, many years later, founded what today is Ace ASI, the private insurance fund for credit unions. So our, our plea, or our, our ask of the credit union movement is to give 1% to the woman that gave 100% to the credit union movement. Because if we don't continue to charter new credit unions, it's not about getting back to 23,000 credit unions, which is, you know, really our peak. What we're really looking at is, is the purpose, and in the words of Edward Filene, we need to keep purpose constant. Every one of these groups that I've talked to and worked with has a very similar story, and the power of common bond is so overlooked today, the reason that they will be successful is because of their common bond. And I remember having started in credit unions in the 80s, the single sponsor, common bond credit union. When you took out a loan, you knew that you were borrowing money from a coworker. I mean, you knew it. And there was kind of, right, yeah, yes. So there was kind of the shame of repayment. You know, it's like, you better pay this back, because Bill, that's Bill's paycheck that you just borrowed, and a brand new credit union still has the benefit and the luxury of that, right? They have, they're loaning, they want to create financial cooperative so they can take care of one another. And so, yeah, go

Sarah Cooke 10:50
ahead. So, because I think it's interesting, the way you said, they have the benefit of that,

because so many are only talking about scale, that's right, opposite,

Denise Wymore 11:01

right? Yeah, small is beautiful. They can be successful. They will be successful. We do need to help them, you know. And the other great thing about, so consider this, when I did my discovery time and started working with, you know, Martha and Kyle and everyone, NCUA's been great to work with, is in my discovery phase, a year ago, June at an NCUA board meeting, Martha reported that there were 51 applications in the pipeline, and so I wanted that updated number. So in June of this year, I got that updated number, and it's 63. Keep in mind for those listening, we as a movement, are not promoting the financial cooperative model. Unfortunately, we're really not. There is the state leagues, and I've been, I'm going to work really closely with them. That's why they were charted in the 30s. The demand isn't quite there, you know, it's growing, but that, and that's important, but the demand isn't there for every league to have a specialist. And so what our ask is of the leagues is when you get someone who comes to you because they often do, don't send them to the NCUA. It's not the NCUA's job to charter credit unions. It's their job to protect the insurance fund and to provide a charter, but to get them through the process is not their job. And so we've already worked really well with the Cornerstone League for a De Novo in St Louis, and they help. We're getting mentor, a mentor credit union. We're getting in-kind donations of loaned executives. So that's how we, the CU De Novo Collective can work with the leagues to help these guys be successful. But we need your money. Yeah, so let's get back. Let's get back to the money part. No, we need your money. We need your money. And if we were Italy, and we were really smart, we would have done what Italy did. In Italy, it is a law that all cooperatives, so grocery store, every cooperative, including credit unions, must give 3% of their net income annually to a fund, and that fund provides startup capital for new cooperatives. Cooperatives are crazy successful in Italy because of that. We don't have anything like that, unfortunately. But 3% we decided on our board, we have a rock star board of directors, three not, maybe a stretch. Let's go for 1% and what we're asking of the 1% is, I mean, ideally it would mirror Italy, it would be 1% of net income. But Allison Carr, who I just love, she's like, let them decide. You know, maybe it's 1% of non interest income, maybe it's 1% of a particular fee or 1% of some other, you know, promotion that they do and the income they get from it, whatever it is, we're calling it dealer's choice, but what we're asking is for you to kind of take that number into your accounting meeting and kind of noodle around and say, What can we give? How can we give back to start new credit unions. And CUSOs, you know, CUSOs are having been working with NACUSO for five years. I love CUSOs owned by credit unions. You know, the for-profit arm, they do amazing work. We also would really love to have the support of the CUSOs, knowing that they embody cooperation among cooperatives, that six cooperative principle, and that, you know, if they can appeal to their board and the league foundations, the league foundations are also another big supporter of ours. They've been, they reached out to us first and said, We want to learn more. You know, how can we help? So it's been a wonderful experience. Honestly, we're all volunteer. It's not a business. Nobody's getting paid. It's a volunteer, grassroots effort, which we also love. And want to keep it that way, because that's how the credit union movement started.

Sarah Cooke 14:38
Yeah, now I'm a CEO of a, or No, I'll go give you a harder one. I'm a CFO

Denise Wymore 14:48

Married to one.

Sarah Cooke 14:48
Of a million dollar credit union. Why do I want to give you 1% of whatever income stream I decide?

Denise Wymore 14:57

Because you're a good person. I. It, you know, it's a great question. And honestly, you know this, I've always felt like the CFO's job is kind of to protect income. And, you know, bottom line kind of a thing. It really is, truly, a give back to the movement. And if you think about it, the trajectory that we're on right now, if credit unions go away, and the math is not great, you know, if credit unions go away, trade associations go away, CUSOs go away, the vendors go away, it's not good for anyone. And I think that also for telling the credit union different story, if we can point to starting 10, 15, 20 credit unions a year, banks aren't doing that. In fact, community banks are shrinking faster than credit unions right now. So let's talk about how we as a movement are supporting the formation of new credit unions that are minority-lead credit unions, some of them in bank deserts. We have a new story to tell. You know, to be honest, you understand. So, yeah, yep, a new underserved and we want to protect taxation. That's a way to look at it, because that's truly an investment in continuing to tell the credit union a different story and in a new way, a new old way. In fact, speaking of that, when I when AUX reached out to me, Diane is the CEO of AUX. I have her. She's amazing. And I said the help that I needed from them was to create this template. And we call it, we called it Operation Cigar Box, because the original credit union, so many were started in a cigar box. You know, they were simple, and what we cracked the code on was, like, these eight credit unions that started are really pretty basic services. I mean, they are kind of like the original cigar box credit union with basic, you know, shares, loans, signature loan, used car loan, the checking, we couldn't add checking until the 70s, but, you know, checking, but that's it. You know, really basic small credit unions. And we also know that starting out small ensures the probability of success, right? We all know that, and so that more of the crawl, walk, run approach to the business plan is what we're doing with our template. And

Sarah Cooke 17:11

So what sorts of, as you're working through these hurdles, you mentioned the policies and you started, I don't know if this was your point, but you're talking about how limited this, the, the offerings can be at some of these new credit unions. Yeah, there's, there's a lot of different hurdles for credit unions to overcome. What are, what do you think is the biggest one? And what are you how are you working on that one?

Denise Wymore 17:35

So some of the biggest hurdles for, for the new credit unions, obviously, and the real successful ones, my NCUA contact, who's wonderful, who's worked with this group that is going to get a charter. She said, you know, Denise, all the charters that are granted and the ones that are successful all have the same thing in common. And that said, it truly takes a village to help them. And so we have an example of one that got in-kind donation of technology from CU Answers. Randy Carnes created that program. And oh my gosh, are they lovely to work with, right? So take the expense of core processing, you know, basic checking features, website, maybe build a website. Take that off of an, their balance sheet for the first couple years, boom, done. The in-kind donation from the loaned executive at the credit union in St. Louis. Second biggest expense, human resources, right? They just eliminated that. Those are probably the two biggest hurdles financially, and if they have partners like CU Answers and a loaned executive from a large credit union? We are, we are setting them up for success, right? Because they understand the business. Oh, and then AUX, the reason, other reason I got involved with AUX was they've been silent heroes giving in-kind donations to these De Novos after they get started by helping them for with their first call report, by helping them with their balance sheet and working with their board and making sure that they don't financially get themselves in trouble. You know, right out of the gate and the Call Report's daunting. You know that a small credit union might have to fill out, you know, seven fields, but just go find them on the 28 pages statistical report. So they've been doing that, you know, giving in-kind donations, and doing it on their you know, not talking about it, not saying, hey, look what we're doing over here. So I think, and that's bringing the village together, right? Bringing the credit unions together. So even if you can't give money, you know, if you could give, if you could be a mentor credit union for one of these groups that is money and and giving a loan executive is money, and it's win-win. This credit union St. Louis has said it has been such a win-win for us, because they get to learn. How many of us could say we started a credit union that are listening? How many of you started credit unions that are listening to this? Yeah, and the CEO of this large, well, I'll say who it is. It's Bob McKay. He's amazing. And he even it was like, you know, I had to kind of rework my brain to think about starting one. You know, keeping one going is a whole different thing than starting one. And where would you start? Right? So if you can donate your time, that is very appreciated, too. All right, and just go out to our website. I'm

Sarah Cooke 20:25
going to give you a chance for final thoughts, and you've got about 60 seconds to do it. So what are your final thoughts?

Denise Wymore 20:34

My final thoughts is back to Edward Filene. Keep purpose constant, guys. Why did he start credit unions in America? Why do we need credit unions America, in America? And it is truly serving the underserved. And this, these small groups are doing just that. So please support them, because I know you support that notion.

Sarah Cooke 20:52
Awesome. Thank you so much. Denise, great to see you again.

Denise Wymore 20:54

Thanks, Sarah.