| History of Polam: | ||
| The picture of
Northern California was much different in the late sixties from what it
is today. Sunnyvale, Walnut Creek and Milpitas were still rather small,
rural towns with orchards dominating the landscape and none of the
industrial parks and glamorous office buildings so prominent now. Similarly, the Polish community in the area was much smaller and thinly spread over a huge territory except for four distinct conglomerations in: San Francisco, Oakland, Monterey and Sacramento, with the Polish Hall in San Francisco the only community property and the main center of activity. The leading organization, the Polish American Congress for California, was split in late sixties into two separate Divisions and the newly created Northern California Division’s leadership was searching for viable goals to gain acceptance by members and establish its identity within the national central in Chicago. The third consecutive President of the new Division, Zdzislaw Zakrzewski, first elected to the office in 1972, has adopted a long term agenda for community development as the main task for Congress; it implied creation of strong institutions capable of providing tangible services to members as means to enlist their following rather than appealing to their emotions and sense of duty. While searching for appropriate type of such institutions it soon became clear, that there are three basic pillars capable of supporting any community in America: a church, a bank and a physical facility for commerce and social activities. If this triad is fully developed, healthy and successful, the community based on it will likewise be thriving and capable of creating other, complementary initiatives. This general belief was rigorously followed as witnessed by the actual events: in 1974 Polam Federal Credit Union, basically a cooperative providing banking services, began its operation; in 1975 the first Polish Pastoral Mission in the area was established and in 1977 the shares of the Polish American Center, Inc. (a business corporation registered under the laws of the State of California) were issued to subscribers as a first step towards creating capital to build a Polish retirement facility with shopping mall, restaurants, library, chapel, theater, meeting hall, etc. Thus a foundation was laid for all three of the basic community supports. As to Polam, it was created on the example of the So. Cal. Division’s Credit Union in Los Angeles, which was started in 1971 by its President Mr. Henryk Westwalewicz, Mr. Zakrzewski’s close friend and coworker from Rochester, NY Following the lessons from the Los Angeles experience, a conference of all local leaders was called in September 1973 in San Francisco which resulted in a motion unanimously accepted, that a credit union be sponsored by the Congress for its members. The study and preparation period ensued and on November 30, 1973 a formal, organizational meeting was called to order with ten subscribers who signed the formal application for a charter. The name “Polam” was suggested by late Mr. Bruno Shatyn, an early enthusiast of the idea, who was present at this meeting as a notary public and formally certified subscribers’ signatures; naturally, the service was performed free of charge and Mr. Shatyn has later agreed to serve on the first Board of Directors of the new union. In February came letter of approval from the National Credit Union Administration dated January 7, 1974 with a charter No. 21-502. Polam FCU thus became an operational organization with assets insured by the federal Treasury through the NCUA. Polam’s first offices were located in a tiny room serving as library on the top of steep flight of stairs in the Polish Hall of San Francisco, offered free of charge until earnings would allow payment of some rent. Unfortunately it soon became apparent, that it was too difficult for our first Treasurer, late Mr. Stanislaw Pieczynski, to travel regularly to keep established office hours and when later that year he was disabled through an accident, the office was moved to the home of Mrs. AS. Bauer, who agreed to serve as the Treasurer. However, the new location, in remote part of the City proved to be too difficult to access for members and in 1 975 the office was moved to the home of Mr.& Mrs. Zakrzewski more conveniently located at the mid peninsula in Foster City; the bookkeeping duties were soon taken over by Mrs. Zofia Zakrzewski, as an unofficial help to her husband. However, in 1976 she was elected to the Board and became a Treasurer, the function she continues to this day. By now it was quite obvious, that the union will soon need a formal office and a paid staff, otherwise its development and future may be in jeopardy; that of course required reaching certain size to provide adequate earning power, therefore all efforts were directed to rapid accumulation of assets and development of income. AU local activities, such as organizational meetings, religious functions, shows, dances, etc. were turned into an opportunity to approach, inform and sign up new Polam members and the results were soon visible: as shown by the early financial statements exhibited in the Appendix the assets doubled and tripled in the first few years of existence with comparable growth in earnings. Much later it was discovered that this method of recruiting and serving members had to be used in spite of opening a formal office; geographical dispersion would require unsustainable number of offices if adequate access was to be provided to all interested in Polam services. The idea of Polam representatives taking our services to members at various, unrelated activities remained for a long time the best available tactic to assure membership growth and satisfaction. In February of 1977 a first, single room office was rented on the first floor of former Crocker Bank building on the 2nd street in San Mateo. The Treasurer turned into a one person office staff until Alicia Purcell joined in five months later. After the first six months of working just for the mileage expenses, the Treasurer now turned into Manager has received a fixed salary of $100 / month for the unlimited number of working hours and full responsibility for the operation. With the steady growth and increase in earnings. Polam kept expanding its facilities, services and personnel accordingly. In 1978 a first branch was opened at the home of Mr. & Mrs. Paprocki in the Sacramento area, to better serve members of the Polish Social Club of Sacramento; Betty Paprocki became the Manager and the only employee of this office, with her husband Walter, at the time member of the Board of Directors, as a volunteer helper. This arrangement lasted till 1983 when an office was rented in a bank building on Sunset Blvd. in Citrus Heights and a regular employee was hired to staff it. When the Polish Social Club in Sacramento purchased a property in Roseville, Polam’s local office was moved to that building where it is located presently At the same time, Mr. John Smelski Polam representative for the Oakland / East Bay area, could be seen at all Polish functions such as Sunday masses, meetings and dances carrying a briefcase with signature cards, loan applications and other forms for members as needed. to save them a trip to the office in San Mateo. Almost immediately after moving to the rented office, in late 1977 a computer service from Crocker National Bank was retained; the service would process all daily activities on a batch basis. This streamlined operation and allowed to run Polam with minimal personnel. thus more than offsetting the reasonable cost of the service. However, in 1980 when assets were approaching $3, 000,000 and number of members 1,000, it became evident, that the batch system would be inadequate for the volume of transactions and it was replaced by the “on line” Users system. This was done in view of the perceived need to further expand services by introducing so called “share drafts” or checking accounts, which could not be operated without the capability. Since the checking requires access to the national banking network Polam has signed a contract with the Security Pacific National Bank to perform clearing functions for Polam. Providing checking accounts was not just a new valuable service to members; it also opened to our members access to several hundred of local, Security Pacific branches to use as deposit and withdrawal points, thus facilitating access to their accounts. It may be difficult to realize, but Polam is in a very unique position in that regard. Most credit unions are based on common employer and that means that most of the members are every day in well defined places for work; an office opened on the premises provides an easy, daily access to all desired services offered by the credit union; the employer usually cooperates in providing automatic payroll deductions for savings and / or loan payments. Banks with branches at every street corner find it difficult to compete with such a combination of services. Credit unions based on territory, mean that potential members all live within the same geographical area, hence a centrally located office provides a reasonable access for most them. Even unions based on an organization, have members living fairly close, or meeting regularly and often at a fixed location; they are usually church congregations, home owners’ associations, etc.; by their nature they imply close proximity to a central point of activity, which makes location of a credit union office natural and convenient to most, if not all, members. By comparison, there are very few credit unions in existence similar to Polam, with members dispersed over hundreds of miles between Santa Barbara and the Oregon border and with no major centers in between to economically support a branch office. Thus finding a method to free members from the need to travel many miles to reach a service point, was and still is a paramount problem for Polam management as a very condition of credit union growth. For this reason, the powers granted to credit unions to offer checking and the existence of Security Pacific service, became a major license on Polam’s life; this simple contract was equivalent to opening hundreds of branch offices in Northern California to serve Polam members, a goal otherwise utterly unattainable. Since the first office was rented, the constant growth forced continuous adjustments. After absorbing adjacent rooms on each side of our first rental, we have reached the limit of expansion at that address and in 1981 Polam moved to larger facility, suite 408 at corner of El Camino Real and Bovette in San Mateo. In two years we started expanding again and it became obvious, that sooner or later we will exhaust the space available for expansion and will have to move again. Each move became a hardship not only on the personnel, but also on members; they had to adjust to new location, different routing, parking, etc. and the management realized, that to avoid repeated changes of address we have to start thinking about own building. In 1982 Polam introduced residential mortgage loans; they became instantly very popular since a lot of our members would have hard time to qualify for a bank loan. It does not mean of course, that they were a poor loan risk; they just did not fit the general pattern, the bureaucratized bank operatives were familiar with and that made them uncomfortable and unwilling to grant loans. It is difficult for an average American to accept a notion, that a person may not have a steady employment record, show below average earnings and no credit history, simply because he or she is a recent immigrant, starting life from scratch in a foreign land, without knowledge of the language, or a backup in family and friends. This was manifest by the reaction of many federal examiners, who for years were warning Polam Directors to tighten up on loan policies to avoid “risk loans”, which to them were loans made to the new immigrants. Just as a reminder, the early eighties were the years of the marshal law in Poland and the mortal struggle between communist government and the Solidarity. They were years of the mass exodus of the persecuted and the scared, later enhanced by the systematic expulsion of the Solidarity activists from Poland by the regime. Thousands of those people arrived in the United States and eventually some found their way into Polam. Recognizing their special needs and inability to obtain regular bank credit, Polam Directors instituted special policies to accommodate them, i.e. during the first 12 months from the arrival date in America, a member was entitled to special loans (at lower than normal interest rate) as soon as he / she received a firm promise of employment. The package consisted of up to $500 for apartment rental and up to $2,500 for purchase of a used car. The logic behind it was, that if a person gets a job they must have some money to rent an apartment (one month’s rent and cleaning deposit) and means to travel to that job (in California, generally a car). For many years we had to fight every federal examiner who spotted this policy and protested, that this is a "reckless activity", because we give those loans to people without prove of steady employment and credit history; they would not consider that these are people just a few months in the country and cannot wait for three or more years without any help to prove their earnings power and only then start working on their credit history. Finally examiners were assured by the fact, that in spite of our “reckless” policies we still have about the lowest rate of loan losses for all credit unions in the country. Of course the problem is now mute; there are hardly any new immigrants coming to our country and the “immigrants special” has long expired. Returning to our story, Polam kept steady expansion of services and introduced VISA cards in 1984 through a service contract with Bell Savings Bank; when that bank folded in 1986, we moved to a shared VISA card program operated by the California Credit Union League. In 1985 first Automatic Teller Machine (ATM) cards were introduced to further facilitate members’ deposit process and access to their funds. Then by 1986 it was apparent, that the size of operation requires an in house system and a mini computer was purchased for $75,000; it took Polam only about five years to outgrow that system and in 1991 it was enhanced to reach about double the capacity. It was not so much the number of accounts, as the variety of services offered to members that caused Polam to outgrow the computer capacity; in that regard we are quite unique among credit unions of similar size, who offer much more limited range; this should be appreciated by our members. As the years rolled by Polam went through two expansions by absorbing adjacent space fortuitously available for rent at just the desired time. In 1989 the Directors realized, that the time has come to acquire own building as the permanent Polam headquarters or face another trauma of moving. The search was successful and in July 1989 Polam became an owner of a building in Redwood City with 5,000 sq.ft. of space and a long term tenant willing to rent over 2/3 of the total. This would leave close to 1,800 sq.ft. for Polam offices and assure a sizeable income from the rest; in the future we could remove the tenant and take over as much space as needed, while renting the remainder. Due to our rental contract, we settled in Redwood City in the fall of 1990. Year of 1992 will be remembered as the period of difficult operational changes. In May we were officially notified, that the Security Pacific Bank was acquired by Bank of America and all services to credit unions will be terminated by the end of October (6 months later). This meant the painful loss of checking accounts services and access to several hundred SPB branches in the area. Polam was not alone in this predicament; there were about 250 credit unions dependent on similar services from SPB. After a frantic search through several willing providers we have settled on the Bank of the West because it was the only contractor who has many branches in Northern California and allows deposits through their ATMs. The transition was completed on time by October 1992. However the pain of change has stopped but for a short while. By February 1993 we were approached by the President of the Russian American Credit Union with a proposal of merger. After studying all facets of the situation and consulting with the NCUA and an independent consultant, Polam’s Board decided to enter into the merger. All the formalities were fulfilled in record time and we have met the NCUA imposed deadline of March 31, 1993 with final cut off date set at April 30, 1993. As a result, Polam assets increased by close to 25% (to over $15,000,000) and the membership doubled (to about 4,000). One of the most important acquisitions was the office in San Francisco, much needed by Polam, but not justifiable as a separate facility prior to merger. Polam has offered to our new members considerably expanded services and financial resources previously lacking. The latest event was the access to Polam of the Russian Center of San Francisco, Inc. allowed by NCUA in a decision changing again our Field of Membership as communicated to us by the letter dated February 23, 1994. This is the first opportunity to welcome members of the Russian Center into the Polam Family Bigger and stronger. Seasoned by 28 years of continuous, successful operation and with enhanced Field of Membership, the new Polam is uniquely poised to offer superior services to members and a conditions for further growth. Our confidence in the future of our credit union Family is well based and fully justified. The Way it Happened:
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© Polam Federal Credit Union • Legal Notices • Deposit Insurance |
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Polam Quick Facts |
 Open
for business - 1974 |
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4,000
members |
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Over $50-million strong |
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4
Offices in California |