A Fast-Moving Mission Propels Connex Credit Union Forward

The cooperative is closing the wealth gap in its Connecticut communities through home loans, charitable giving, volunteerism, special products, advocacy, and more.

New Haven, CT has a storied history: Perched on the banks of the Long Island Sound, the Puritans’ planned city by the sea is home to Yale University and the birthplace of everything from the submarine and the steamboat to the Colt revolver and the Erector Set. And, from 1878-80, the city saw the birth of the first telephone exchange, the first telephone directory, and the first public phone.

Not surprisingly, the New Haven Telephone Employees Federal Credit Union was chartered in 1940 to serve telephone company employees and their families in the greater New Haven area. As its membership grew to 450 companies, the credit union moved to a community-based, state charter in 2002 and rebranded to Connex (pronounced “connects”) a year later.

The credit union’s service area was hit hard by the Great Recession in 2008; then it was slow to recover. Inner-city neighborhoods have been plagued with unemployment, blight, and a lack of access to basic services, such as grocery stores and banks. But Connex Credit Union ($896.8M, North Haven, CT) has stayed true to its commitment to the community.


Connex Credit Union
DATA AS OF 06.30.22

HQ: North Haven, CT
ASSETS: $896.8M
MEMBERS: 66,275
12-MO LOAN GROWTH: 18.4%
ROA: 0.59%

Most of Connex’s 66,275 members are working-class families. The average share balance of $11,642 is more than 17% off the national average, and many new members are getting a debit card or taking out a loan for the first time in their lives. Despite these challenges, Connex is among the fastest-growing credit unions in the country — it has more than doubled in size in the past decade. As of June 30, 2022, its 12-month share growth (8.6%) and loan growth (18.4%) were among the top 8% of credit unions nationally.

“We have grown at a rapid pace consistently over the past decade, which has afforded us an increased opportunity to give back,” says Frank Mancini, who joined Connex in 2003 as CFO and became president and CEO 2012. “Now we’re wanting to do so in even bigger ways. We have a great team, and we want to make a difference. We are not shy about making this commitment.”

That commitment to giving back includes earning certification as a Community Development Financial Institution (CDFI), planning to make $30 million in loans available mostly to Black and Hispanic members during the next five years, carving out $5 million in charitable donation accounts to fund philanthropic giving, eliminating a significant amount of overdraft fees, offering credit-building products and financial education, participating in community and political advocacy, and dedicating an estimated 6,000 hours of volunteerism in the next five years.

Connex started most of those projects within the past year or so, and the credit union recently added a community development specialist to work with local partners to deepen relationships with aid groups. There’s an unmistakable sense of urgency in the way Connex is approaching community impact.

“We’re never going to be Bank of America with a billion dollars in loan funding,” Mancini says. “But we can make an impact on our community, and that’s meaningful to those folks who benefit from it.”

Serving The Underserved

The new programs build on things Connex has been doing for years. As far back as 2013, Connex was named New Haven’s No. 1 financial institution for serving the unbanked and underbanked, based on a Yale study on community impact commissioned by the City of New Haven. Connex also ranked as the best in products and services — well ahead of much larger banks that included Bank of America, Wells Fargo, and Chase.

Frank Mancini, President and CEO, Connex Credit Union

In 2015, Mancini was asked to serve on the city’s Financial Empowerment Commission to take advantage of a grant awarded by the city Center for Financial Empowerment. He worked alongside community activists and heard stories of hardships in the city’s low-income neighborhoods.

Around that time, changes were occurring within Connex’s board of directors. A majority of the board members had served for 30 to 50 years and had reached retirement age. Three had moved out of state more than a decade earlier.

“We had to re-energize our board,” Mancini recalls.

The board discussed issues such as term limits, age limits, and residency requirements. During the next several years, the chairperson and two other members retired and moved to emeritus status to mentor the incoming directors.

“The board set up profiles of what they want in board members, we revisited the governance process, and by 2019, we went from an average board tenure of 30-plus years to an average tenure of three years,” Mancini says. “It was a big change. Now, a lot of the board members are somewhat new to the credit union space and somewhat new to financial services, but they have a desire to make a change.”

Like many, the younger board was profoundly moved by the events of 2020, including the death of George Floyd while in police custody in Minneapolis and the subsequent social unrest. Among the new board members was Annie Harper, a Yale researcher whose work focuses on the social determinants of mental health, and understanding how financial services and retail firms can better serve people with low incomes, mental illness, and incarceration histories. The board named Harper chair of its newly formed Social Justice Committee.

The board subsequently adopted a new mission statement, adding the words “communities” and “employees,” so it now reads, “Improving the financial wellbeing of our members, employees, and the communities we serve.”

According to Connex’s executive vice president and chief operating officer, Carl Casper, this was a significant change.

We now talk a lot more about the communities we serve. You get a greater sense that we’re not just here to serve the member in front of us. We’re here to serve the communities that we operate in.

Carl Casper, COO, Connex Credit Union

Creating New Loan Opportunities


With the heightened focus on community impact, the board and management delayed the adoption of the 2022 budget so that it reflected actionable deliverables within the calendar year. A key component of that was CDFI certification. Upon approval, the credit union immediately applied for and hopes to receive a $1 million grant to supercharge its lending program later this year. Connex typically has a 100% to 105% loan-to-share ratio and periodically boosts share revenues through deposit specials to members, but the board wanted to make a bigger impact closing the wealth gap through home ownership. The CDFI grant will help underpin new loans to low- to moderate-income borrowers.

“The goal of the program is to fund $30 million in first mortgage, down payment assistance and rehabilitation loans to serve underserved — primarily Black and Hispanic members — in New Haven County over the next five years,” Mancini says. “We made our first loan in June despite not having received a grant. Our board was very desirous of us not waiting for the grant and asked us to make a commitment to make at least $1 million in loans this year, regardless of whether we received the grant.”

Another key strategy was to hire personnel dedicated to making an impact on the community and driving new loans. Lee Dupree joined Connex in April as the credit union’s first community development specialist. He brings more than 15 years of experience in working for nonprofits and human services groups, and he aims to connect Connex with the needs of the community.

“I’m getting to know the people in the community, making partners and relationships with different nonprofits and organizations that uplift the community, learning what their needs are, and then seeing what we can do to help,” Dupree says. “We’re here to help educate the community, break some of the traditional mindsets of the inner city, and teach them different ways to obtain wealth and build better lives.”

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While Dupree spreads the word about community impact programs, newly hired Katrina Goins has taken the reins as part-time community development loan representative. Goins, a veteran in community lending who previously worked for Neighborhood Housing Services of New Haven, identifies potential home mortgage candidates for the $30 million loan commitment.

“She’s an expert and has ties to community agencies that work with people who are looking to borrow from nontraditional lenders,” Casper says. “Our goal is to close the wealth gap, and this will get it started in a big way.”

Nontraditional mortgage lending means greater flexibility around debt-to-income and loan-to-value ratios, considering income from multiple people who will be living in the household, down payment assistance, and rehabilitation loans.

“If somebody is at 40% DTI, that loan might fly,” Casper says. “If loan to value is at 110%, given some circumstances, that one might fly, too. Every one of these loans is unique. They’re not simple. Otherwise, somebody else would do them.”

The credit union is committed to offering conventional mortgage rates for borrowers who qualify, regardless of what traditional risk scoring might say.

“We’re not interested in putting people into a bad situation with a loan they can’t pay back,” Casper says. “We have to be conscious of that for their safety. We want to work with the housing agencies in New Haven, and they will work with borrowers to help qualify them, and provide them with financial education. We’ll come in and supplement that education by the time they’ve made a decision on a particular property.”

Industry Advocacy

Another thrust of Connex is to advocate for reforms that will benefit low-income families and credit unions — at both the state and national levels. Connex serves on the Connecticut Credit Union League board and legislative committees and continues to support the BankOn Coalition, a locally led partnership of public officials, government agencies, financial institutions, and community organizations aimed at improving the financial stability of unbanked and underbanked communities.

Connex is actively lobbying at the state level to make financial literacy courses mandatory for high school graduation, although it continues to meet resistance from teachers and state lawmakers alike

As far back as 2013, Connex was named New Haven’s No. 1 financial institution for serving the unbanked and underbanked. Connex also ranked as the best in products and services — well ahead of much larger banks that included Bank of America, Wells Fargo, and Chase.

“Not everybody goes to college or university or trade school; some people go directly to work, but they’re not being taught how to manage their financial lives,” says Louise Nestor, director of marketing at Connex. “Once they get past high school and even in college, they don’t always teach how to manage a bank account. What do credit scores mean? How do credit scores impact you? How to budget? These are some of the basics we provide through free seminars.”

Mancini also serves on the NAFCU board, which has been calling for resources from the Treasury Department to ensure grant dollars get out to these communities. Plus, it’s making a larger push to get government-sponsored enterprises to create a framework to buy back some CDFI assets, which would exponentially increase the values of the grants and the ability of CDFIs to put money out into the communities.

The Road Ahead

With more people shifting to remote work during the past two years, Connecticut has become an attractive alternative for a growing number of New York City residents. Housing prices have been climbing, and the Connecticut unemployment rate fell to 3.7% in July, although it remains higher in New Haven.

Thanks to higher home equity values and higher wages, Mancini says more people are paying down credit card debt and saving, but he worries about the continued impact of inflation and a possible recession on working families whose paychecks won’t stretch as far.

“If a recession actually hits – and it depends how deep it hits – the folks who are living from paycheck to paycheck will need a helping hand in the next couple of years,” the CEO says.

By the same token, Mancini is concerned about the impact inflation has on Connex’s own employees. An Amazon fulfillment center recently opened across the street and is putting pressure on wages for area employers. In the past two years, Connex has given employees pandemic bonuses or pay adjustments, and he says management is looking again to “make sure we keep paying our people appropriately.”

“We’re thrilled about the things we’re able to do,” Mancini says. “We’re energized and challenged by the fact we’ve got 150 people and 72 projects going on. Our people are tired, and we push our folks probably more than most. It’s a great credit union made up of committed individuals who come to work every day and get a lot done. I’m proud to lead an organization so focused on achieving our mission and vision.”

Despite the potential storm clouds, Mancini says the long-term outlook for Connex is bright.

“We’re going to be here for another 80 years,” he says. “We know there might be some hiccups with the economy, but we understand those are beyond our control. So, we try to position our balance sheet in a way that we can withstand short-term plays like this. We have a great lending engine. We’ve been able to sustain our earnings and sustain our growth without being restricted by it. In this business, the only way you can grow is to continue to earn.”

This is part of the “Anatomy Of A Credit Union” series, presented every quarter by Callahan & Associates. Read more about Connex or dive into a decade of archives. Contact Callahan to learn about gaining access today.

October 15, 2022

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