NEW YORK — Does the Big Apple really need two credit unions to serve its law enforcement community?
After starting the process seven years ago, the Finest Federal Credit Union learned on Wednesday that
The Finest FCU plans to open in the spring and "provide its members with financial services tailored to the needs of law enforcement and correction officers from the time they enroll in the Police Academy through retirement."
But Municipal Credit Union, another New York-based institution has served city workers — including police officers — for almost a century.
James Shea, a volunteer member of the board of Finest FCU, told Credit Union Journal that while Municipal CU is an "excellent institution," his group had identified other specific and unique needs that could be satisfied by a credit union dedicated solely to law enforcement officers, employees and their families.
Keith Stone, president and CEO of the new institution added that the Finest FCU "will offer some unique products that other credit unions do not."
"For example, we are going to offer products that protect an officer and his family from financial ruin if the officer is killed in the line of duty, as well as scholarships established for the children of those same officers," said Stone, a former vice president at Consumers FCU, a $45 million institution in Brooklyn N.Y.
Shea pointed to financial services such as: special loans for new recruits to finance police equipment and uniforms; loans for small businesses that may be part of an officer's retirement plan; and retirement planning geared to members of law enforcement.
Kam Wong, the president and CEO of the $2.1-billion Municipal CU, welcomed the arrival of Finest FCU, despite the fact that both institutions may have some overlap in their fields of membership.
"Municipal CU already serves employees of federal, state, county and municipal agencies or departments engaged in police protection in New York City," Wong said. "We welcome Finest Federal CU to the credit union movement and to the New York City marketplace, where we have proudly served our membership since 1916."
Municipal CU is a state-chartered institution.
Stone said Finest Federal's launch was delayed due to the pressures of the economic crisis. "The project was re-started only two years ago," he added.
The credit union will be supported by the New York Police Department and received initial capital from AmTrust Financial Services Inc., an $11.3 billion entity providing property and casualty insurance to small businesses, according to NCUA.
Chartering a new credit union is indeed a lengthy and costly process, resulting in only a handful of new institutions emerging each year. According to data from NCUA, since calendar 2005, the agency has chartered 33 new CUs, an average of a little more than three per year.
"It's very hard to start a new credit union," said Jordan Modell, CEO of the $3 million Internet Archive FCU New Brunswick, N.J., which was granted its charter in 2012. "You have to raise funds, perhaps as much as $500,000 in secondary capital, and that's not even including costs related to legal advice, regulatory filings, paperwork, etc."
