BEL AIR, Md. (4/22/11)--The $188 million-asset Har-Co Maryland FCU, of Bel Air, has submitted applications to federal banking regulators to convert to a mutual savings bank, the regulators confirmed to News Now.
Har-Co Maryland FCU submitted an application to the Office of Thrift Supervision for a savings bank charter on March 25. On March 28, it applied to the Federal Deposit Insurance Corp. for deposit insurance.
On Feb. 14, the credit union published a notice to members of its consideration to convert from a federal credit union charter to that of a federal mutual savings bank. On March 16, its board voted to pursue conversion.
At that time, Jennifer M. Simmons, interim CEO/chief membership officer at the Maryland & District of Columbia Credit Union Association, said that while the association's board "firmly believes that the credit union charter provides the best vehicle for serving the financial needs of consumers, we do support the right of member/owners to exercise democratic control of their credit union."
She added, "The association encourages credit unions considering conversion to make their decisions based solely on the best interest of the members and that the credit union provides full, plain language and timely disclosures to the membership so that an informed decision can be made by the member/owners."
Founded in 1955, the credit union serves more than 27,849 members of primarily educational groups. Its notice said it intends "to increase membership and economies of scale" to better serve members and "to preserve its tradition of competitive pricing, plus make it easier to cost-justify adding branches." It also noted a conversion would provide "additional business flexibility" (News Now Feb. 17).
Thirty-one credit unions have converted to banks since 1995. No credit unions converted in 2010 and only one converted in each of 2009 and 2008, according to a News Now analysis (Jan. 14).