Does your bank educate your community?

OneCalifornia Community Development Banking Report }2009 Q2

Ours does.

TM

B A N K

Preparing the Way for Lifelong Learning & Success

Above: Lighthouse fifth grader on a OneCal-sponsored field trip to Chabot Space & Science Center.

Pictured on the cover and in top right photo: (left to right) Brian Rogers, Jenna Stauffer, Lisa Zuffi, Laura Kretschmar, Angelica Cuevas, Michele Davenport, Alejandro Zepeda.

Bottom right: The light-filled warehouse space at 444 Hegenberger Road before renovation to Lighthouse Community Charter School.

Lighthouse Community Charter School

PHOTOS:COVER & ABOVE RIGHT: LINDA RUSSELL ABOVE: CHRISTINE WALKER BOTTOM: COURTESY LIGHTHOUSE

BANKING ON

ONE SUCCESS

AT A TIME TM

OneCalifornia strides into its third year of operations as a community development bank and supporting foundation with an ever-widening family of individuals, businesses and organizations dedicated to improving economic opportunity. This report spotlights visions to educate—a fierce belief in innate capacities to learn, a focus on low-income communities and a commitment to nurturing successful lives.

Look into the eyes of a Lighthouse Community Charter School student and you’ll see beaming evidence of the school’s mission, which is to equip each child with the knowledge, skills and principles to be a self-motivated, lifelong learner. Multiply that light by 650 students and you’ll feel the impact this K-12 Oakland public school is having on students and their families. Founded in 2002 to close the achievement gap, the school has grown from 92 students the first year. The student body is 80% low-income, 72% ESL (English as Second Language) and 90% from families where no one has gone to college. From the first class to graduate in June 2009, all 21 students—100%—are going to college.

Jenna Stauffer, Director of Strategic Develop-ment and co-founder with fellow teachers Steve Sexton and Laura Kretschmar, describes the school’s inception: “We had taught in some of the most underserved ur-ban schools in the country and decided we had to do something about educational equity. Our vision is being realized and our hope is that we make a positive impact on the future of children, Oakland and even the world.”

As a California charter school and a nonprofit 501c3 organization, Lighthouse is part of the public school system, free from many of the procedural requirements of public district schools, yet still ac-countable for student achievement. It offers an alter-native to other schools and does not charge tuition. Ad-mission is determined by lottery. Lighthouse’s leased campuses for K-6 and 7-12 have been too cramped and high rents have drained valuable program dollars, so the school undertook an $11 million renovation at 444 Hegenberger Road. OneCal Bank is helping with a $2 million dollar loan.

Lisa Zuffi, OneCal Bank Senior Vice President and Banking Group Head, shepherded the loan. “The relationship with Lighthouse has been building since after the Bank opened in the fall of 2007 and through the school’s participation in the Chabot field trips.” The annual OneCal-sponsored trips for Oakland public school fifth graders unite businesses and nonprofit organizations in providing learning opportunities to spark college and career goals. “We’ve been talking to Lighthouse all along about their need to find permanent space.” The credit package involves New Markets Tax Credits and debt from OneCal Bank in partnership with NCB Capital Impact. The renovated facility will open at the beginning of this school year.

The project, designed by Oakland architects Stark-weather Bondy, is being built by Cahill Contractors, a third-generation Bay Area firm with an Oakland history dating back to CEO Jay Cahill’s grandfather, a 1905 University of California graduate, inspired to his career by the need to rebuild San Francisco after the 1906 earthquake. Two existing warehouse/office build-ings, converted into a consolidated, light-filled space,

will accommodate all students with ample class-rooms, science and media labs, art studios, a library and planned outdoor recreation space.

Brian Rogers, Lighthouse Board President, a former teacher and Executive Director of The Rogers Family Foundation, advocates the Lighthouse philosophy of educating the whole child. “It’s our family’s hope that Oakland can create schools where parents can drop kids off in kindergarten and expect they can go to college in 12 years. We’re invested in this school and are partners with them in this project.”

The school’s focus is on achievement—academic, socio-emotional and behavioral—and learning. Teachers identify specific goals for their students and regularly analyze data and adjust practices in pursuit of these goals. Literacy is emphasized throughout the entire school and interwoven into every subject area. Teaching and learning extend through a longer school day and school year.

Science teacher Laura Kretschmar accompanied her fifth graders on the first OneCal-sponsored field trip. “The earthquake lab fit perfectly with what we were studying. It’s great for kids to have learning experiences outside the classroom, to be exposed to other Oakland students and other science experts and professionals.” Laura’s cousin, Alex Graf, worked in the film industry and was a frequent visitor to the school. He died while working on a film in China in 2003 and a scholarship was founded to commemorate his life.

Two 2009 Lighthouse graduates, Angelica Cuevas and Alejandro Zepeda, entering Dominican College and University of San Francisco this fall, respectively, received Alex Graf Scholarships, awarded through the East Bay College Fund.

To learn more and to give support, go to www.lighthousecharter.org, www.eastbaycollegefund.org.

TM

B A N K

“Our vision is being realized and our hope

is that we make a positive impact

on the future of children,

Oakland and even the world.”

Jenna Stauffer

At the core of OneCalifornia’s mission to improve economic opportunity, financial literacy promotes skills for maintaining checking and savings accounts and using credit wisely. Essential at every stage of life, these skills are especially important for college students living away from home for the first time. Without parental supervision and with enticements offered on and off campus, many students become burdened with debt during college.

A recent Sallie Mae study reported that seniors are “graduating with an average credit card debt of more than $4,100, up from about $2,900 in 2004.” East Bay College Fund scholars attending summer financial literacy classes at OneCal Foundation learned about the risks of easy credit. Classes were taught by Susan Keiter of East Bay College Fund and Andrea Walker of OneCal.

Angelica Cuevas, who will be living at Dominican College, said she was glad to be warned about how credit card companies target college students with offers. “Later when you get the bill you realize you’ve spent a huge amount. It’s one of the main things that puts college students in debt.”

Alejandro Zepeda found out about overdraft charges. “I thought the banks just charged you one time, but they can get you every time you spend over the amount you thought you had.”

Emely Srimoukda, who will be attending Chico State, learned a technique for managing debit withdrawals. “I’ve had a bank for a few years, and I never used the little book to keep track. Susan showed us how to use it.”

In their pursuit of a college education, these bright and accomplished students, along with other East Bay College Fund scholars, have overcome tremendous obstacles placed before them by immigration, financial hardship and tragedy. A near fatal car accident changed Alejandro Zepeda’s life and shaped his ambition to succeed. In his neighborhood, he’d witnessed many young men in trouble and decided to take a different path. He enters the University of San Francisco this fall with steady determination. “I’ve decided to prove to everyone who doubts me that I can accomplish my dreams. Regardless of what happens, I know that I will rise every time I fall.” As his supporters also know, the community will rise with him.

3

Working Together to Find SolutionsEast Bay College Fund

Tying It All Together with Financial LiteracyOneCalifornia Foundation

A community-based non-profit organization, the East Bay College Fund provides scholarships, mentoring, on-going college counseling and life skills training to East Bay (primarily Oakland) public high school students from low-income families and commu-nities with historically low college attendance rates. Since its incep-tion, East Bay College Fund has awarded 100 four-year $16,000 scholarships with mentoring support.

OneCal is closely connected with East Bay College Fund through Andy Fremder, who co-founded it in 2002, along with a committed group of East Bay citizens, educator and community activists, and who also serves on the board of OneCal Bank. Andy says, “The problems need to be attacked from all sides. In order for all of this to work—education and opportunity—organizations need to work together. Students need a good education to qualify for college, they need support to succeed in college, and they need to be able to come back to a community that offers jobs. We’re focused on the college piece, doing our part. Lighthouse is doing theirs. OneCal and the businesses and organizations that bank there are developing economic opportunities. It all ties together.”

Michele Davenport, Executive Director, describes the rela-tionship between the East Bay College Fund and OneCalifornia as “long-standing and strong” and extending far beyond the deposit relationship. “OneCal is our partner, their team supports our efforts and programs (and vice versa), their staff is critical to our selection process as volunteers. They offer complimentary financial literacy courses for our scholars and have provided a credit workshop at our annual scholar/mentor retreat.” After attending financial litera-cy classes at OneCal Foundation, next door to OneCal Bank, new scholars are invited to walk over to the Bank and open a free checking account.

Michele and College Counselor Susan Keiter are enthusias-tic advocates. The interviews, awards dinner, special events and mentor/scholar retreat—all of which rely on volunteers—create com-munity around the students. Susan works them throughout the four years to help them stay on track with their finances.

Grass roots efforts and contributions from a wide variety of individuals and foundations enable the East Bay College Fund to support over 80 continuing scholars. Seven Great Expectations scholarships were given in the inaugural year, 2003, and now at least fifteen are given annually. Eleven scholars have graduated from college, many of whom have committed to support East Bay College Fund or to give back to the Oakland community. To learn about becoming a mentor, visit www.eastbaycollegefund.org/mentor.

East Bay College Fund scholars at a OneCal Foundation finan-cial literacy class: (from below, far left) Emely Srimoukda, Alejandro Zepeda, Karla Burgos and Andrew Wilson (lower right) with Susan Keiter of East Bay College Fund; (above) Shavonnee Clark and Tyrone Radford, Jr.

PHOT

OS: A

NDRE

A WAL

KER

PHOT

O: LI

NDA R

USSE

LL

4

Financial Literacy Q & A: Leading to Innovation

An innovative project of OneCal Bank and the Mission Asset Fund (MAF) in San Francisco, Cestas Populares brings traditional informal lending circles into formalized modern banking. It helps people build credit histories and gain access to financial services. Amilcar Reys and Carmen Gaytan were attending financial training at Mission Asset Fund (MAF) when they learned about Cestas. With their daughter Graciela and one other, they formed the project’s first lending circle.

Having completed their initial four-month cycle, the group is in an eight-month duration, allowing each person to borrow and repay $200 twice in the cycle. Through their individual accounts at various banks, each person contributes $50 a month to the circle’s fund at MAF. OneCal debits the accounts through an electronic network. Loan payments are reported and cash flows to MAF. MAF makes an electronic deposit to the account of the next borrower. Loans, used as wished, pay household bills, tuition, car repair and debt.

Carmen, pictured above with Amilcar and a symbolic money basket, shares her experience. “I never thought about saving. In our country [Columbia], we live day by day. If we have money, we spend it. Now I know we have to have money in the bank. It’s like a family savings plan.” Both Carmen and Amilcar have work histories—she a nurse at General Hospital and he a chef at Little Joe’s for 17 years and before that on fishing boats in El Salvador. Due to misfortune and going on disability, they had ruined their credit. Carmen says that the group and the organizations backing it build trust and give her a greater sense of security. “I have friends who’ve done lending circles –maybe 15 people putting in $100 every month. But they are just thinking about the money. They aren’t thinking about building credit.”

Amilcar and Carmen see building credit as a step toward their dreams. He wants to start a spaghetti sauce business. They are trying to buy a house. She loves to buy presents for her grandchildren. “Now I can’t just go spend $50. It makes me feel good to have money in the bank.” www.missionassetfund.org

Exloring Opportunities for the Unbanked and Underbanked

Cestas Populares Update

Many people in the San Francisco Bay Area have no banking relationships or less than what’s adequate for their financial well-being. By assessing the problems, asking questions, and looking past old assumptions to innovations, OneCal is finding ways to help low-income communities meet their distinct needs. In partnership with other organizations, OneCal Foundation is implementing several ideas to serve unbanked and underbanked individuals and foster economic opportunity. A key component of OneCal’s involvement is the prepaid debit card, which allows the holder to purchase items, receive direct deposit, pay bills and load cash onto the card. No credit check or linked bank account is required, and there is no way for the holder to overdraft.

Payroll Debit CardsThe Situation: Every summer, Oakland Private Industry Council (PIC) gives jobs to low-income, disadvantaged Oakland youth, ages 14 to 24, and pays them with checks. Unfortunately, many of the youth are unbanked and turn to check cashing services, which may have predatory policies including high fees (as much as 3% per check) and enticements to borrow against future paychecks.The Question: Is there a viable alternative for paying employees and meeting requirements of PIC’s payroll operations? The Innovation: OneCal Foundation and Community Financial Resources are partnering to provide reloadable debit cards and pay the opening fees, as well as most of the monthly maintenance fees, for 1,000 participating youth this summer. The participants receive their wages through these cards and, when summer ends, may keep the cards and be responsible for any monthly fees. The cards are reloadable at various locations. The Foundation will provide financial literacy classes through its OneCal SAFE program to educate youth about banking services and financial management.

Neighborhood Economic Development HubThe Situation: In San Francisco, of the more than 50,000 unbanked individuals, 34,000 live in the Mission District. Many of these people are living below the poverty line; many are immigrants. They need help in overcoming language barriers, discrimination and other issues. A myriad of nonprofits serve their needs, but the splinter approach is costly and inefficient.The Question: Can organizations join forces to strengthen their delivery of services and create a place where people can go to get their variety of needs met?The Innovation: A renovated warehouse at the corner of Mission and 19th Streets will house several nonprofit organizations dedicated to economic development. By the end of this year, Plaza Adelante will open as a hub offering social services to the community and shared business services for all tenants in the building. An-chor organizations are the Mission Economic Development Agency (MEDA), Good Samaritan Family Resource Center, Mission Asset Fund, CAMINOS Pathways Learning Center and OneCalifornia Foundation. With its Mission District Pro-gram, the Foundation hopes to help the unbanked by providing them with kiosk access to financial services and prepaid debit cards, as well as financial literacy classes.

“Smarter” ATMsThe Situation: Typical ATMs link to customers’ bank accounts but don’t offer a full range of banking services. For people with no bank accounts or living in neighbor-hoods underserved by their financial institution, ATMs are useless or inadequate.The Question: Can a smarter machine help people avoid the high costs of predatory check cashing and payday lending practices and offer needed financial services?The Innovation: A financial kiosk that allows users to choose from multiple languages and pay a fee based on the services used, including bill payment, money transfers, international remittances, money orders, and the purchase of stored value cards, gift cards, phone cards and more. The kiosk will be an important part of OneCalifornia Foundation’s Mission District Program. Future innovations may allow for prepaid debit cards to be purchased through the kiosk, as well as check cashing and payday loan services offering interest rates and loan limits acceptable to organizations advocating for borrowers.

To learn more, go to www.onecalfoundation.org or call 510.663.2253

5

Improving Community Health & Fueling Business Growth

Clearing the Air: Loans for Clean Trucks

Oakland Chamber Honors MembersBeing a community development bank means aligning with mission-driven organizations to build relationships vital for community prosperity. The goals of the Oakland Metropolitan Chamber of Commerce—to promote commerce and industry, to advance economic growth, and to enhance the quality of life in the city of Oakland—are close to OneCal’s own. In June, the Chamber awarded OneCal Bank President & CEO Jeff Cheung their Business Person of the Year Award. When Jeff picked up the voice mail message announcing the award, he had to listen twice. “In this economic climate where banks have gotten bad press, to be a banker and get the Business Person of the Year award—I’m still kind of amazed.” He quickly added, “I only ac-cept it as part of recognition of our OneCal team—a great staff, advi-sors, board members and community partners. At the awards cer-emony, Jeff spoke extemporaneously about the challenges we’re all facing. Below is a recap of his thoughts on his favorite topic...

Clean air benefits all of us, but some people fight harder for it. For years, as a West Oakland resident, Margaret Gordon championed air quality for her neighborhood. Since February 2008, when she was appointed as the Port of Oakland’s First Port Environmental Liaison, Commissioner Gordon has brought her knowledge and passion to issues of public health and environmental justice, as well as to issues facing independent truckers, including better working condi-tions and access to capacity and sustainability.

Studies of health risks from diesel exhaust in West Oakland led to an April 2008 resolution by the California Air Resources Board (ARB). The Emission Reduction Plan for Ports and Goods Movement includes a return to 2001 emission levels or below statewide by 2010, and an 85% reduction statewide in the health risk from diesel particulate matter (PM) from all goods movement sources by 2020.

For 2,000 independent truckers, this resolution translates to buying new, cleaner big rigs or installing modified “scrubbers” in their older models. 500 to 1,000 truckers who have yet to comply will need grants and/or loans to cover the costs of new or modified equipment. The Port of Oakland has selected OneCal Bank to provide financing to those truckers serving the Port. The Bank is offering SBA 7(a) loan programs. The truckers also receive banking services—free checking, savings and online banking—as well as financial education.

With OneCal’s SBA Clean Truck Loan Program, truckers can take advantage of the Obama administration fee waiver on 7(a) loans, which also carry a 90% guarantee. If truckers require additional business capital, OneCal’s SBA Manager Robert Gebauer and his team will help them assess their needs. Whatever the bigger picture, one thing is clear. Clean trucks will benefit truckers and create healthier, sustainable communities.

Older diesel trucks release more particulate matter (PM), including soot, ash, and metallic abrasion particles, than newer trucks. The majority of PM is in the form of carbon, which directly relates to chronic respiratory diseases. The soluble organics portion of PM—30% to 50%—contains numerous cancer-causing chemical compounds. Exposure to diesel PM is an occupational hazard of truckers and dockworkers. Newer diesel engines have particulate scrubbers on the exhaust system, which makes them essentially as clean as gasoline engines. Scrubbers reduce carbon monoxide and PM, and can be installed on older trucks.

A goal of the ARB resolution is to reduce localized health risk in communities expeditiously. Commissioner Gordon has long been working toward that end. In 2001, she co-founded the West Oakland Environmental Indicators Project, which reported diesel emissions there as five times greater than in the rest of Oakland. She planned the San Francisco Bay Area’s first regional conference on reducing diesel pollution and improving public health. The “Ditching Dirty Diesel” event rallied community organizations, environmentalists, public health groups and government officials to focus on asthma and other health problems related to diesel air pollution.

An asthma sufferer, she co-authored the Healthy Home Indoor Air Quality Project and served on Governor Schwarzenegger’s statewide committee on State Goods Movement Action Plan. Now, with OneCal as their banker, California truckers can move on their own action plans for cleaner emissions.

For more information: Robert Gebauer 510.550.8409.

In the Kellogg Foundation’s annual report, President & CEO Sterling Speirn stated that thinking out of the box is not a luxury any more. The economic climate has crushed the box. We can’t be just thinking about surviving. We have to think about thriving. If there are any blessings to the distressed economy, if there’s any kind of silver lining, it’s that people understand we have to work together. People are showing greater will-ingness to collaborate in innovative ways.

Banking on Community Street

At OneCal we’re working harder than ever, but not just to keep up. We’re looking for opportunities to try things that haven’t been done before or do what’s been done better with more sustainable results. When the economy recovers, it won’t be enough to be back where we were before the downturn. That can’t be our measure. We have to do better, especially for low-income pockets of our community.

Please join us in Community Development Banking.

Jeffrey Cheung, President & CEO, OneCalifornia Bank

Pictured at the Chamber’s 104th Annual Meeting, members and award winners (clockwise from top left) John Nelson, Joe Haraburda, Jim Ellis, Patricia Scates, Michael LeBlanc, Phil Arca, Jeff Cheung, Jose Corona, Dan Cohen, Reid Edwards. Photo courtesy Oakland Chamber. www.oaklandchamber.com.

“

”

PHOT

OS: V

IVIA

N CH

EN, M

ICHEL

LE W

ALKE

R PHO

TOGR

PAHY

©20

09 O

neCa

lifor

nia Ba

nkPr

inted

on 10

0% re

cycle

d pap

er

Your deposits fuel OneCal’s mission.

Ask us about CDARS®, the Certificate of Deposit Account Registry Service. Now you can

invest up to $50 million, be eligible for FDIC insurance on

every dollar, and enjoy working with just one bank—OneCal!

Call Norma SaavedraSenior Vice President

Depository Relationship Officer NSaavedra@OneCalBank.com

u510.550.8405

Banking on One Success at a TimeOneCalifornia Bank, FSB1438 Webster Street, Suite 100Oakland, CA 94612

FIRST CLASS MAILU.S. POSTAGE PAIDOAKLAND, CAPERMIT NO. 332

Member FDIC

CDFI Certified Bank

EQUAL HOUSING LENDER

OneCalifornia Bank, FSBwww.OneCalBank.comPhone 510.550.8400

1438 Webster Street, Suite 100Oakland, CA 94612

OneCalifornia Foundation www.OneCalFoundation.org

Phone 510.663.2253 1438 Webster Street, Suite 101

Oakland, CA 94612 Salvador MenjívarExecutive Director

Bank Hours M– Th 9 am – 4 pm

F 9am – 5 pm Sparks flew at the Crucible May 15th when the Indie Awards celebrated Oakland’s innovative, socially- and environmentally-responsible businesses and artists. Erin Kilmer-Neel (top left), OneCal Foundation Program Officer, announced the winners: Awaken Café, Greenie; Hip Learning, Naru Kwina (lower left with his daughter and 2008 winner Keith “K-Dub” Williams and Andrea Walker, OneCal Foundation Executive Program Assistant), Youth Empowerment; Catered to You, Newbie; Grand Lake Theatre, Pillar; Girl With a Truck, Innovator, Isabella Guajardo (above right); Margo Rivera Weiss, Ripple Effect; Cynthia Elliott of Rough and Ready Repairs and Steve Ma of Woody’s Drapery & Laundromat, Neighborhood Dynamos; and Khalil Shaheed, Oakland Soul. Join us next year for the 2010 Indie Awards. Fire up the local economy by supporting Oakland’s independent businesses and artists.

For information and photos of all Indie Award winners, go to www.oaklandunwrapped.org/indies.

To learn about industrial arts, go to www.thecrucible.org.

TM

COMMUNITY C O N N E C T S

Celebrating Indie Awards 2009