Pennsylvania Bankers In Fight To Overturn Three CUs' FOM Expansions
The Pennsylvania Bankers Association refused to take "yes" for an answer and has filed to overturn expansive field of membership grants approved by the Department of Banking for three state-chartered credit unions.
In its suit filed in Commonwealth Court the banking group claims the state regulator erred in approving requests by TruMark CU, in the Philadelphia suburb of Trevose, and Freedom CU in Philadelphia to serve more than four-million people in five counties surrounding the nation's fourth-largest city; and a separate community charter allowing Corry-Jamestown CU to serve anyone within a 35-mile radius of the credit union's Jamestown offices.
In asking the state court to overturn the banking department's administrative ruling the bankers assert that the three FOM grants do not qualify as a "well-defined, local, community, neighborhood, or rural district" as required under state statute.
Representatives of the PBA would not comment on the case when reached by The Credit Union Journal.
But the bankers' ire appears to have been raised by a slew of broad community charters granted to Pennsylvania credit unions in recent months, by both the state and by NCUA.
Right around the time the state regulator was approving TruMark's and Freedom CU's five-county FOM, NCUA was approving a request from New Cumberland FCU to serve more than 1.2-million people in six counties surrounding its home; and from Philadelphia FCU to serve all of the City of Brotherly Love as an "underserved community." The state regulators also approved a request from St. Basil Parish CU to serve more than two million people in greater Pittsburgh, and Fairless CU, Morrisville, to serve all 650,000 residents of Bucks County, to start the new year.
Michael Wishnow, a spokesperson for the Pennsylvania CU Association, said the credit union side is confident that the state regulator acted properly in awarding the three community charters. "We feel that the decision by the Banking Department was fair and reasonable under the circumstances and we stand ready to support the Banking Department in any way we can," he said.
The community charters granted TruMark CU and Freedom CU are the most expansive ever approved for state-chartered credit unions in the Keystone State. Freedom CU originally asked for an even larger area, but the state regulator would not allow it to add the three adjacent counties in next-door New Jersey. TruMark originally asked for a smaller area, just four suburban Philadelphia counties, but was allowed to add Philadelphia County. Corry-Jamestown CU also amended its original request, which was to serve the 300,000 residents in Erie County.
The bankers' suit represents the first time an FOM grant has gone to court in Pennsylvania.