Credit Unions Serve a Variety of Needs

Discover how New Jersey’s credit unions are in tune with their members.

While credit unions around the country have been merging and are fewer in number than they were six years ago, they report increased activity in 2014 and expect more lending in 2015 as the state’s economy continues to gain momentum. 

“Overall, credit unions have remained strong in New Jersey from a lending perspective. The economy has been a challenge since 2008, but credit unions continued to stand by their members during that time and continued to lend. It’s been difficult because our state’s economy continues to lag behind the rest of the country,” says Greg Michlig, president and CEO of the New Jersey Credit Union League, which represents 120 credit unions in the Garden State.

“In 2015, we expect to see more small business loans, and to the extent that we can build awareness of small business lending, most credit unions are ready to take on that loan volume,” Michlig adds, noting not every credit union is involved with small business lending, but those that do are prepared for it.

Bloomfield-based XCEL Federal Credit Union is 100 percent “loaned out,” reports Tom Quigley, director of marketing. “This is a good problem to have. Too often in a down economy, credit unions may [hold] too much money in savings, which they can’t loan out and invest. While most credit unions are 30 or 40 percent loaned out, we have $100 million in assets and $100 million in loans.”

XCEL’s 18,600 members include employees of the Port Authority of New York and New Jersey and some 200 companies. Founded in 1964, XCEL has branches in Jersey City and Lower Manhattan, while administrative offices were moved to Bloomfield after 9-11.

Quigley says a new App that allows members to take a picture of a check with a cell phone and deposit it into their accounts has proved a big hit.

A national trend Quigley sees is that credit union memberships are growing as are their rates of savings, but smaller credit unions are merging with larger unions because of administrative costs.

“Nationally, credit unions have 100 million members and a trillion dollars in deposits,” he says. “So it’s more people, more money, but fewer credit unions. The industry itself is downsizing.

“I think small businesses are getting tired of paying bank fees. We think every business in New Jersey should offer their employees a credit union. … That’s our goal.”

Issa Stephan at First Financial Federal Credit Union in Wall Township says his organization was founded in 1936 for the benefit of teachers in Asbury Park. Now, First Financial is open to anyone who lives, works or worships in Monmouth or Ocean counties.

First Financial has $190 million in assets as of 2014, and branches in Toms River, Howell Township, Wall Township, Freehold and Neptune.

First Financial is a full-service credit union, Stephan stresses. “We offer anything any local or national bank offers and we can compete on that level,” he says, adding, “Additionally, when someone applies for a loan here, they don’t deal with an automated system. Every person who comes for a loan – either as a member or non-member – has a story, and we take the time to understand their situation and see how we can help them through it,” Stephan says, noting that credit unions were born out of the Great Depression when banks weren’t lending. He likens that situation to what New Jerseyans and the rest of the country faced with the Great Recession of 2008-2010.

“We spend a lot of time with our members on financial education, and that’s what differentiates us from for-profit banks,” Stephan relates.

“These past five or six years have been very difficult for people. That’s why budgeting is important … and it’s not easy. It’s like losing weight … you have to go to the gym every day. Financial fitness is no different. It’s really hard work.”

First Financial’s “sweet spot” for small business loans ranges from $250,000 to $2 million.

“We get to know the business owners and see what we can do to help them,” Stephan says.

First Financial will celebrate the grand opening of its new Howell Township branch on Route 9 in April, though the facility is expected to be open for business by late January.

Tyrone Muse of Visions Federal Credit Union in Endicott, New York, says Visions’ field of membership includes many counties and communities throughout New Jersey, New York and Pennsylvania.

The credit union was founded in 1966 as the IBM Endicott Employees Federal Credit Union in Endicott. In 1981, it merged with the IBM Owego Employees Federal Credit Union to become the IBM Endicott-Owego Employees Federal Credit Union. The credit union was created to meet the financial needs of IBM employees and their families. As the institution grew through the years, and became available to non-IBM employees and families, the name was changed to Visions Federal Credit Union in 1994. Visions, which has 180,000 members and 38 locations (10 in New Jersey), will celebrate its 50th anniversary in 2016.

“You will find all the traditional banking services at Visions: savings, checking, auto loans, credit cards, mortgages, online banking,” Muse says. “However, where we shine is in the vast array of options within these categories, such as extended terms for loans or a special mortgage program for first-time home buyers, plus professional staff who can save our members money through refinancing existing loans from other institutions and debt consolidation.”

Like XCEL, Vision also offers smart phone deposits via check imaging.

“At Visions, you’re treated like family. We want you to succeed financially and we’re here to evaluate each situation and find the best possible solution for you,” Muse stresses.

“As a not-for-profit financial institution, we pride ourselves on becoming our members’ financial partner for life. We want to ensure there is value in the membership and look to enhance the financial position of each member of the cooperative. We do this by not only offering traditionally higher dividend rates, lower loan rates and lower fees, but also through numerous education programs such as our BALANCE Program, which offers free counseling for members regardless of their financial position.”

Muse says Vision FCU has been involved in small business lending for some time and plans to continue to grow this business sector. Vision’s services to growing businesses include checking, credit card, merchant card processing, insurance, online banking access, simplified employee pension plans (SEPs) and wire transfers.

Affinity Federal Credit Union, based in New Providence, is the state’s largest credit union, and it grew along with AT&T through the 1970s and 1980s. Affinity has more than 135,000 members from more than 5,100 businesses, organizations and clubs. It has total assets in excess of $2.3 billion.

The credit union’s origins date to 1935, when it was founded in New York City. The organization moved to New Providence in 1984. Then known as GHQ Federal Credit Union, it changed its name to AT&T Employees FCU, to more accurately reflect membership at that point in time. In 1998, with the announcement that AT&T would be split into three separate companies, the organization changed its name to Affinity.

“Affinity currently has 15 locations throughout New Jersey and we provide access to an additional shared branch network of more than 4,000 branches nationwide, as well as a network of more than 65,000 surcharge-free ATMs,” says CEO John Fenton.

“Affinity continues to add to its products and services with the latest in innovations such as our new branch service design, which delivers quicker and easier transactions and faster access to information,” he says.

“Starting in early 2015, AFCU members can use Apple Pay with their iPhone 6 to make purchases in stores without swiping their credit or debit cards. They will also be able to use Apps without entering payment and contact information. Members can just pay with a single finger touch using Touch ID,” he adds.

“We’re also at the forefront of those adopting EMV credit cards, and we’ve begun issuing credit cards with embedded computer chips that will ultimately replace the magnetic strips currently featured on all cards,” Fenton adds.

He points out that Affinity has always been involved in small business lending, particularly during the recent “Great Recession.”

“In fact, when the market crashed and big banks began turning small businesses away, we were able to focus on providing small business loans again, because we see our work with our members as long-term.”

Keeping up to date with the latest in transactional technologies, providing personalized service and fast becoming a major player in the small business lending market, New Jersey’s credit unions are in tune with the needs of their members.


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