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National Cooperative Bank


The National Consumer Cooperative Bank (NCCB) was created and chartered by the National Consumer Cooperative Bank Act (92 Stat. 499, 12 U.S.C.A. 3001), enacted on August 20, 1978. The bank is directed by the act to encourage the development of new and existing cooperatives. The bank provides specialized credit and technical assistance to eligible cooperatives that provide goods, services, housing, and other facilities to their members as ultimate consumers. The bank is itself structured as a cooperative financial institution. Under its congressional charter, the bank is directed to make loans and offer its services throughout the United States, its territories and possessions, and the Commonwealth of Puerto Rico.

The act provided that the federal government would contribute the initial capitalization of the bank through the purchase of the bank's Class A stock. All 15 members of the bank's board of directors are appointed by the president of the United States. The act contemplated that the number of president-appointed directors was to decrease gradually as borrowers and cooperatives eligible to borrow purchased Class B and Class C stock in the bank.

In 1981 the act was amended by Title III, subtitle C, of the Omnibus Budget Reconciliation Act of 1981 (95 Stat. 433). The 1981 act converted the federal government's initial capitalization of the bank, formerly represented by Class A stock, into Class A capital notes, held by the secretary of the treasury. The act further mandated that after the Final Government Equity Redemption Date (FGERD), as defined by the National Consumer Cooperative Bank Act, the bank's Class B and C stockholders would elect 12 of the bank's 15 directors. The remaining three were to be appointed by the president with the advice and the consent of the Senate. The president is directed by the act, as amended, to select one member from among proprietors of small business concerns, one member from among the officers of the agencies and departments of the United States, and one member from among persons having extensive experience in the cooperative field representing low-income eligible cooperatives.

The bank is operated by a board of directors under bylaws and policies it prescribes consistent with the National Consumer Cooperative Bank Act.

The bank's credit and technical assistance to cooperatives is intended to improve the quality and availability of goods and services to consumers. The bank makes loans to eligible cooperatives at prevailing market interest rates.

The bank encourages broad-based owner-ship, control, and active participation by members in eligible cooperatives. The bank also seeks to maintain broad-based control of the bank by its voting stockholders.

The National Consumer Cooperative Bank Act established the Office of Self-Help Development and Technical Assistance within the bank. Cooperatives that are eligible to receive assistance from the bank may be eligible to qualify for financial and technical assistance from the office. The office may provide financial assistance to newly developed or established cooperatives that cannot qualify for a bank loan, or when the membership of the cooperative consists substantially of low-income persons or it provides services to low-income persons.

The Omnibus Budget Reconciliation Act of 1981 directed that as soon as practical after the FGERD, the board of directors of the bank would establish a nonprofit corporation under the laws of the District of Columbia to succeed the office and to carry out the functions of the office. That nonprofit corporation, the Consumer Cooperative Development Corporation, was incorporated on December 30, 1982.

In 1985, the NCCB became a private financial institution and changed its name to National Cooperative Bank (NCB). At the same time, the Consumer Cooperative Development Corporation became the NCB Development Corporation (NCBDC). In 1986 the NCB registered with the securities and exchange commission and performed its first private placement. The NCB, in 1995, launched the Community Association Loan Program that provided financing for condominium, townhouse, and other owner associations. By 2000, the NCB had provided more than $6 billion in financing to homes, school facilities, assisted living units, and other community developments.

further readings

National Cooperative Bank. Available online at <> (accessed July 28, 2003).

U.S. Government Manual Website. Available online at <> (accessed November 10, 2003).


Housing and Urban Development Department.

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