MECHANICSBURG, Penn. - The bankers may have convinced a federal judge to scrap the broad community charter for Members 1st FCU, but that won't slow down the rapid growth of the $1.4-billion credit union.
"If the bankers thought they confined us, they didn't," Members 1st's President Bob Marquette told CU Journal following the court ruling, noting plans to cultivate some 800 groups his credit union has been developing partnerships with and turning them into select employee groups.
The U.S. District Court for the Middle District of Pennsylvania issued its final ruling ordering Members 1st and two other regional credit unions, AmeriChoice FCU and New Cumberland FCU, to dissolve a broad, five-county charter covering some 1.2 million people between York and the state capital of Harrisburg, and to return to their prior charters.
The credit unions can continue to serve members within the six county community who joined prior to the court's ruling. The final ruling by the court closes the federal case. The NCUA has jurisdiction to review any future requests by the credit unions to revise or expand their fields of membership.
For Members 1st, that will mean serving the 1,000 SEGs it served before NCUA granted the new charter in 2004.
Since then, growth has boomed for Members 1st, but Marquette said it doesn't have to slow down under the old charter. "I'm not going to kid you, we've done well under a community charter. No doubt about it." he said. "But we've been successful as a multiple-group credit union for the first 50 years of our charter and we will continue to be successful."
Several other options also are being considered, such as a conversion to a state charter, where a much broader community grant currently is being challenged by the bankers in court.
Either way, Marquette vowed, branch expansion will continue, with plans to add five additional service centers, three in local schools, to the current network of 31.
The disputed area was found by the federal court to be lacking in evidence it is a single community, the latest in several suits brought by the banks over expanding community grants for credit unions.
The credit unions' worst fear was that the bankers would ask the court for a divestiture order requiring the credit unions to stop serving members accepted under the disputed charters, but divestiture was never brought up by the bankers or the court.
The ruling also allows the credit unions to go back to NCUA to apply for a community charter, but with smaller parameters.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/
