Polish & Slavic Federal Credit Union was founded in 1976 to help immigrants purchase and renovate homes in a run-down neighborhood of Brooklyn, NY. The credit union established branches in much of the New York metro area throughout the ‘80s and '90s. In 2010, the then $1.6 billion credit union started expanding into the Chicago area and now has more than a dozen branches between the two cities. The credit union is the largest ethnic credit union in the United States and serves nearly 80,000 members. Bogdan Chmielewski served as CEO of Polish & Slavic FCU from May 2007 to December 2009 and returned to the position in May 2013. Here, he talks about how the credit union has been able to achieve success by sticking to its core mission statement.
Polish & Slavic Federal Credit Union was founded in 1976 by a group of Polish immigrants who were limited in where they could obtain financial products and services. As newcomers from behind the Iron Curtain, who lived in and tried to invest in a neighborhood of New York that had a bad reputation, these individuals were unfavorably treated by banks. PSFCU started with one desk at a local diner. Today, after only 38 years of service, PSFCU has more than $1.5 billion in assets, close to 80,000 members, and 15 branches located in three states — New York, New Jersey, and Illinois. Without doubt, PSFCU is a credit union success story.
CU QUICK FACTS
Polish & Slavic Federal credit union
HQ: Fairfield, NJ
12-MO Share Growth: 3.57%
12-MO Loan Growth: 1.44%
I have often wondered what the reasons are behind this success. One is the people who have created, worked in, sacrificed their time for, and devoted their knowledge and experience to this institution. Another is the economy and global politics — including the political struggles which caused an influx of immigrants from Poland and Eastern Europe. And yet another is the fact PSFCU creates and offers attractive financial products and services tailored to the specific needs of immigrants.
However, in my own opinion, the biggest reason for our success has been PSFCU's active contribution, participation, and co-creation of the life of the Polish-American community in the United States. This strategy has been and continues to be successful, and its main goals and initiatives are spelled out in our mission statement: "To provide our members with superior financial solutions to help them to achieve their goals, and to support the Polish-Slavic communities we serve."
The first part of this strategy required selecting a group of sponsoring organizations (SEGs) that were recognized among the Polish-American community and represented various groups and communities. Examples include the Polish Supplementary School Council, Inc., — which encompasses thousands of parents and children via Saturday lessons in the Polish language — and the Polish Highlanders Association, which represents immigrants from southern Poland. At present, we have eight sponsoring organizations that operate in individual states as well as on the national level. PSFCU collects membership dues on behalf of these organizations and transfers them free of charge, which results in higher dues payment and undoubtedly improves the financial stability of these organizations.
Our advertising budget is the second element that helps us be actively involved in this community. It is, by design, probably higher than at other institutions — approximately $900,000 annually. We distribute our advertisements mainly among media operating in Polish-American communities. This is advantageous from a marketing point of view and also helps us support the Polish media in the United States. PSFCU is, without doubt, the main advertiser in this niche market. From this budget, we also sponsor community and cultural events. The PSFCU logo is present at the concerts of Polish musicians, at banquets, and at the holiday gatherings of almost all Polish-American organizations in New York, New Jersey, and Illinois. We are also present at a number of local parishes, as well as school picnics and festivals. Our credit union is always represented at these events, not only by our employees but also by members of the board of directors.
Our donation budget is another important element of our strategy. We distribute $150,000 to $250,000 annually among hundreds of Polish schools, parishes, and organizations to support various goals and events. These funds have helped projects such as the founding of the Chair of Polish Studies at Columbia University, the financial sponsorship of the Kosciuszko Chair at the Institute of World Politics in Washington, and the digitization of historical archives at the Pilsudski Institute in New York. We also support organizations that aid the homeless and take care of the elderly. There are hundreds of grops that have been able to count on the support of PSFCU and the only prerequisite for aid is to be a member.
Many elements of our plans involve young people, who are often second-generation Polish-Americans and to whom we dedicate a lot of our marketing effort. I have already mentioned our collaboration with the Polish Supplementary Schools, which include more than 100 Polish language schools throughout the eastern United States. We also sponsor schools of judo and fencing, ballroom dancing for children, and soccer clubs. We are proud of the fact that many national and international medalists, including several Olympians, have come out of these schools and clubs. And the Polish Scouts can also always count on the support of PSFCU.
I would like to draw special attention to the PSFCU Scholarship Program that the board of directors launched in 2001. PSFCU has devoted more than $2.8 million to this program and more than 2,300 young members have received our scholarships. The scholarship program is divided into two parts, and every student can participate once in each of the components. The first part is offered to college-bound high school seniors. CUANY [Credit Union Association of New York] administers this part; it evaluates the applications of our young members and sends us their ranking. We try to reward all applicants that meet formal requirements, which include being a PSFCU member for at least one year, submitting a complete application, and writing a required essay. Last year alone, we awarded $41,200 to 166 high school seniors. The second part of our scholarship program addresses college students. Each year, a partner group of university professors evaluates these applications and prepares the application ranking. Last year, 104 students received $135,000 in scholarships. We are happy our members and scholarship recipients include students of such renowned universities as Harvard, MIT, Columbia, Yale, and many others.
We want our young members to remember the moment they receive their scholarships because, quite often, these are the first scholarships they've ever received. We have also invited various celebrities to share their experiences at the scholarship ceremonies, including radio and television host Rita Cosby, Pulitzer Prize winner Alex Storozynski, and NCUA board member Michael Fryzel, who is proud of his Polish descent. The scholarship program is, in a way, the pride of our institution. We intend to continue, and even extend, it in years to come. We are also planning to create a scholarship recipients' club and use social media to launch it.
In summation, we are implementing the motto of credit unions in this country: People helping people. In our case, this means primarily helping Polish immigrants meet their financial goals and expectations. And we've learned that as we have helped them, our entire community has become a more valuable, successful, and integrated ethnic group. The constant growth of Polish & Slavic FCU proves our members and communities appreciate this strategy.
— As told to Brooke C. Stoddard