SANTA FE, N.M.–In response to the scandal at Wells Fargo, The City of Santa Fe, N.M., has put out requests for proposals to local institutions to which it could move deposits that are currently in the bank.
“In an effort to spread around the $210 million in various city accounts to community banks and credit unions, the city has put out a request for proposals for banking services,” the New Mexican reported. “In grading the proposals, city officials will consider community reinvestment practices, local employment and financial education. Bonus points will be awarded to institutions based in Santa Fe.”
The city of Santa Fe has approximately $70 million deposited in Wells Fargo. City reports show it has $250,000 deposited in both Guadalupe Credit Union and State Employees Credit Union, along with funds in other banks and investment pools.
“We have a fiduciary responsibility to make sure that taxpayer dollars are safe and invested back into our community as much as possible,” Mayor Javier Gonzales told the New Mexican. “Our financial partners need to have a stake in our community.”
One local bank executive, however, told the New Mexican that the contract is most likely to remain with Wells Fargo because of the reserve requirements specified in the bid request.
“The city would prefer that the total of the city’s assets held at the fiscal agent bank constitute less than 10% of the banks’ total assets,” according to the city’s request for bids.
Winova Nava, CEO of the $161-million Guadalupe Credit Union, said it does not have the collateral to meet the city’s deposit needs.
“Most of our money is loaned out,” she was quoted as saying, “so we don’t have a lot of the illiquid investment assets they would need for us to compete.”