Thursday, February 16, 2012

HarborOne Considering a Mutual Bank Charter

The Board of Directors of HarborOne Credit Union of Brockton, Massachusetts is considering a possible charter conversion in which HarborOne would change from a credit union to a Massachusetts-chartered mutual co-operative bank. As a mutual co-operative bank, HarborOne will be owned by and operated for the benefit of its depositors in a manner similar to the way a credit union is owned by and operated for the benefit of its members.

HarborOne cites three reasons for pursuing a mutual co-operative bank charter:

1. Greater flexibility to expand customer base;
2. Increased lending authority; and
3. Access to additional capital.


  1. As a credit union CEO the question is not how much money will HarborOne save in avoiding NCUA assessments. The question is how much more will my credit union have to pay because HarborOne left the NCUA assessments? In 2011 HarborOne paid over $3 Million in NCUA assessments. Moving to a Bank charter will reduce their operating expenses by over $3 Million. Good News for HarborOne. The Bad News for the rest of us...our assessments have just gone up. $3 Million is not chump change. We are talking real money. Good for HarborOne. I wonder if NCUA Debbie will quickly develop a credit union exit clipping penalty/fee?

    1. We should not prevent any credit union from switching charters. The NCUA assessment portion may be bigger and could lead to many credit unions switching. If NCUA would not make it so difficult to switch, plenty of credit unions would. Any exit fee would be successfully challenged.



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