CU Expansion to Serve the Underserved

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Last year at this time (JRN 39:09), we reported that 31 credit unions had received approval in calendar year 2021 to expand their fields of membership (FOM) into underserved areas. Continuing on with last week’s theme of bank expansion into underbanked areas, this week we’ve updated our credit union list to include both 2021 and 2022 expansion approvals.

On page 5 you will find a list of the 49 credit unions that received NCUA approval to expand into underserved areas during calendar ’21 & ’22. Unless otherwise noted, financial data and membership numbers are as of September 30, 2022.

Reaching the underserved comes with its own challenges, as  4-Star CBC FCU, Oxnard, CA, can attest. CBC FCU is doing its best to serve the needs of Ventura County, CA. In January ’22 it had two expansion applications approved. One gives it access to almost 95,000 potential new members; the other adds 3.9 million. Yet, in nine months, its membership grew by a modest 415.

5-Star Bridgeway FCU, Phenix City, AL does not technically belong on this list as it did not submit, let alone get approved for, an expansion. However, it merged with a credit union that did: Members United CU, Albany, GA. In Dec. ’21, Members United received permission to expand to an additional 203,834 members in Georgia; but it merged with Bridgeway in April ’22.

Bridgeway was by far the smaller of the two, but it had a federal charter, so the decision was made to move forward with the Bridgeway name and charter. As a result, the $15 million asset Bridgeway FCU more than quadrupled its size and membership, overnight. The amount  the new expansion contributed, however, was minimal.

4-Star Affinity Plus FCU, Saint Paul, MN is one that we focused on last year. At September 30, 2021, Affinity Plus had 227,703 members (out of a possible 5.6 million). Then, during the fourth quarter ’21, it expanded its FOM to include the White Earth Indian Reservation, which spans all of Mahnomen County and parts of Becker and Clearwater counties (all in northwest Minnesota). That expansion gave Affinity Plus almost 10,000 new potential members.

As we suspected, Affinity Plus then went ahead and acquired the struggling  White Earth Reservation FCU, Mahnomen, MN, a community credit union for the reservation. White Earth Reservation FCU operated in Mahnomen since 1966 and, until Affinity showed up, it was the only credit union in town. (Although, 5-Star United Valley Bank, Cavalier, ND also has a branch in Mahnomen.)

Between year-end ’21 and 9/30/22, Affinity Plus saw its assets grow  3.8% and its membership 5.7%.

5-Star Founders FCU, Lancaster, SC, is another from ’21. After receiving its approval from the NCUA in December (’21) it wasted no time. By the end of January (’22), it had acquired Arrowpointe FCU, a $187 million asset, troubled institution headquartered in Catawba, South Carolina.

Adding Arrowpoint’s 16,000 members, Founders’ membership now stands at over 250,000. With $4 billion in assets, it is the largest credit union headquartered in the  Palmetto State and currently operates through more than 30 branches across 10 counties in South Carolina as well as in Mecklenburg County, North Carolina. While Founders FCU remains the only financial institution operating in Catawba, there are more than a dozen other options in nearby Rock Hill.

Founders was one of a handful of credit unions that received approvals to expand into underserved areas in both 2021 and 2022. The others were:

5-Star Eglin FCU, Fort Walton Beach, FL, a $3 billion asset credit union, currently operates through ten branches offices in and around the Gulf Coast of Florida. Eglin FCU has indicated it plans on expanding that footprint within the year. Its 2021 expansion approval gives it access to 33,000 new members; its 2022 approval added another 265,000 potential members. Currently, it has close to 124,000, which is about 1,200 more than at the close of 2021.

Conversely, and in spite of its expansion efforts, 5-Star Park FCU, Louisville, KY  lost members in the first nine months of 2022. Although, its assets do continue to grow as does its branch network. It currently operates through 16 branches from Shepherdsville, Kentucky to New Albany, Indiana. Like Eglin and Founders, Park FCU indicates it plans on adding more this year.

Park FCU’s two expansion approvals give it access to over 900,000 new members. That’s huge as its membership at 9/30/22 was under 73,000. It too, will be adding branches.

3-Star Credit Human FCU, San Antonio, TX has a very broad reach already. In addition to 23 branches in TX, it also operates in LA, NC and WA. With $3.6 billion in assets and 231,000 members at 9/30/2022, Credit Human FCU’s approvals give it access to another 1.6 million members. Like the others above, it plans to open new offices this year.

Choice is indeed a blessing; We are heartened to see access growth where it’s needed most.

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