Citing what the industry calls “a significant breakthrough” on field of membership expansion, the New Jersey Department of Banking and Insurance has cleared the way for the $125 million First Jersey Credit Union of Wayne to extend its footprint into four new counties and triple its potential member base.
“We are gratified that the department has approved the application which we filed last January,” said Christopher Davis, president/CEO of the 8.700-member Passaic County credit union.
The authority granted on Nov. 21 allows First Jersey CU to expand into four northern New Jersey counties: Bergen, Essex, Hudson, and Union. They have a combined population of 1.5 million people and are considered part of metro New York.
First Jersey is one of 19 state-chartered CUs in the state. The New Jersey Credit Union League said the FOM approval was the first by the state in five years.
Davis maintained the state regulator “never attached much importance” to FOM expansion by CUs, which may account for the paucity of applications.
“I do know our governor has been occupied with other issues and the department itself has seen turnover,” Davis said, citing Gov. Chris Christie’s focus on budgetary issues and a contentious debate over public employee benefits.
The state agency, complain New Jersey CEOs, has long favored the banking lobby and has seen a number of bank CEOs appointed to the regulatory job. The current commissioner previously was vice president at Met Life Insurance.
“Credit unions have long been the stepchild in the department,” said one CEO who asked for anonymity.
Davis, who also revealed plans for expansion of an indirect auto lending CUSO covering all of the state in line with the FOM approval, credited the New Jersey League with helping break what might be considered a logjam on FOM applications.
“I have to credit Paul and his group for making the state simply more aware of credit unions,” Davis said of Paul Gentile, president/CEO of the trade group.
Davis also said his CUSO, Credit Union Auto Group at First Jersey, has already witnessed a 30-40% increase in loan growth in Passaic County since its launch in February “and we now expect to roll out the program in the four other counties” and also solicit participations nationwide.