Credit Union Journal Daily Briefing | Wednesday, February 16, 2011
BEL AIR, Md. – Har CO FCU has notified members and NCUA it plans to convert to a mutual savings bank, the first conversion in more than two years.
The $190 million credit union, chartered in 1955 to serve school employees in the Baltimore suburbs of Harford County, told its members it hopes the conversion will increase membership and economies of scale to better meet the current and future needs of our members. Existing and future branch locations would, as bank branches, be permitted to serve and attract almost twice as many citizens as they can now as credit union branches, the credit union said in a notice to members.
The Board has considered that a conversion to a federal mutual savings bank will end Harco’s tax exemption, said the notice. Based upon our analysis and meetings with consultants, the Board of Directors believes that the tax impact should be more than offset by the enhanced earnings capacity under the federal mutual savings bank charter and the ability to more effectively serve Har-co’s current and future members.
The credit union has kept in the black the last few years–but just barely-in the face of the nationwide recession and the growing NCUA charges, reporting a mere $27,000 net for 2008, and just $4,700 in net income for 2009, before a $300,538 net for 2010.
Officials at the credit union were not immediately available for comment.