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Amid the current national banking crisis and a possible recession, Founders Federal Credit Union plans to reassure its members by returning $6 million in bonus dividends.
Bruce Brumfield, president and chief executive officer of Founders, said the dividends will be divided into two amounts, $3 million for savers and $3 million for borrowers.
The credit union has more than 180,000 members. The bonus dividends will be allocated to members in good standing.
"It's our way of saying thank you for your support," Brumfield said. "We want to return excess profit to our members."
Since credit unions are financial cooperatives owned by members, both borrowers and savers receive dividends. The dividend payments are calculated based on the interest each member has earned on deposits and any interest they've paid on loans from Jan. 1 through Oct. 1.
And while members with more loans or more deposits will receive more money, Brumfield expects the average member will receive between $75 to $100 in bonus dividends. The payments will be posted to member accounts on Nov. 30.
"That's pretty doggone good," Brumfield said. "We feel like if you can afford to pay bonus dividends, now's the time. People are struggling now and it's time to reward them."
Dividend payments are generally paid at the end of the year, but with the current gas shortage and the failure of many banking institutions around the country, Brumfield thought it was a good time to reassure Founder's members.
"It's unfortunate that folks in the financial sector are having problems, but fortunately for our credit union, we're not feeling that and it's been a very strong year," Brumfield said.
According to Founders, the credit union has returned $14 million in dividends to members over the last eight years.
It distributed $6 million in 2006, $4 million in 2003 and $2 million in both 2000 and 2001.
Contact reporter Chris Sardelli at firstname.lastname@example.org or at (803) 416-8416