Banker-Led Bill Prompts Another Missouri CU to Flee State Charter

ST. LOUIS – Gateway Metro CU, one of Missouri’s largest state chartered credit unions, yesterday said it has fled the state charter in light of a new banker-forced law that restricts community fields of membership.
 
The new federal charter will allow the $180 million credit union to serve a much broader market than the restrictive one set out by a new law, prompted by the bankers’ FOM suit challenging the state’s expansive community charter grants. Under the new law, a state chartered credit union may expand only outside its own county to a county that is contiguous to its main office.
 
Gateway Metro CU is at least the second credit union to flee the state charter since last year’s passage of the new law, joining Aerospace CU, a $175 million St. Charles credit union.
 
The flight from state charter is reminiscent of a similar scenario in Utah, where more than a dozen of the largest state credit unions converted to federal charters after the banks lobbied successfully to restrict community FOMs. Utah banks later fought, unsuccessfully, to apply a state tax to credit unions.