The Real Story

Here’s what First Basin’s directors tell you about why they want to convert your member-owned credit union into a bank. Their claims just don’t add up.

Claim: We Need to Convert to Build New Branches
Fact: As a credit union, First Basin could open approximately 11 new branches (we’ve only got 6!) without regulatory approval*.  If they reach 17 total branches, it probably means the credit union has grown, so the limit would increase. If they ultimately reach the limit, they could seek permission from the state to build more branches, which many credit unions have successfully done. They have not even asked the state for permission. Presumably, talking to the state would be a whole lot cheaper than spending over a half million dollars of member money on this conversion proposal.

We simply don’t need to convert for more branches.

Claim: We Need to Increase Commercial Business Services
Fact: First Basin could grow the current business loan portfolio by 400% before they’d run into any legal limits. Furthermore, members are not demonstrating any demand for business loans.  Out of 23,905 First Basin members, only 23 have a business loan with First Basin. If members are asking for business loans and are not getting them from the credit union, we wonder if First Basin is just doing a poor job of serving this demand from members. First Basin was formed out of the merger of credit unions serving hospital and county employees, most of whom don’t operate their own business.

We don’t need to convert for more business loans.

Claim: We Need to Convert to Make More Home Mortgage Loans
Fact: First Basin acknowledges that “they could meet this need as a credit union to some degree”, but then go on to claim they could do more as a bank. They also acknowledge that they’d have to make fewer auto loans, which account for about half of the credit union’s loans and assets. That doesn’t sound like such a good deal for those of us who rely on the credit union to finance our auto purchases. . .  of which there are 15 for every person that has a home mortgage from First Basin.

Unlike a mutual savings bank, a credit union has no limit on how many home mortgages and car loans it can finance! Remaining a credit union works for everyone.

• Fact: First Basin spent a whole lot of member money – over a half million dollars – on this proposal. That’s $25 per member, even if the conversion fails. We don’t know how much went to their Washington, D.C. lawyers, but based on the fancy language in their pitch to members, we suspect that a sizable amount was paid to them to help convince the members to give up their credit union.

We don’t need some high-priced Washington, D.C. lawyers to tell us what’s in our best interest! We know that members are better off as owners of a credit union than as customers of a bank.