Although HarborOne Credit Union members voted to approveconverting their credit union charter to a co-operative bankcharter, it may take weeks or months to complete the regulatoryhurdles, the Boston-area credit union said.

The $1.9 billion HarborOne in Brockton, Mass., said it will besubmitting a certified copy of the member vote results and otherdocuments on March 25 to the NCUA and the Massachusetts Division ofBanks, which is the first regulatory step in the process that willallow the credit union to convert into a co-operative bank.

Also Read:
HarborOne Members Approve Conversion to Bank

On Monday, the credit union announced members of HarborOneapproved the charter change proposal with nearly 62% of votingmembers casting ballots in favor of the proposal and with over22,433 of its members exercising their right to vote on theproposal, according to the credit union's statement.

HarborOne's 139,078 members were mailed ballots on Feb.19. Eligible members mailed in their ballot, placed theballot in a lockbox at one of the CU's 14 branches, or voted inperson during a special meeting March 11. The Colbent Corp. of Braintree,Mass., served as the independent inspector of the election.

After the certified member vote results and its accompanyingmaterials are submitted to NCUA, the agency will have 30 days toeither approve or reject the certification. The state's division ofbanks will have 10 days to either approve or reject thecertification as well.

James Rice, HarborOne's senior vice president of marketing, saidthe regulatory agencies will ensure the ballots and materialssubmitted to members explaining the conversion proposal wereidentical to the ballots and materials submitted earlier to theNCUA and the state.

“They want to make certain we didn't make any edits in thematerials after the fact, so it will take some time (for theregulatory agencies) to compare what we originally sent to NCUA andwhat we mailed to members (concerning the proposed conversion,)”said Rice.

“We are not projecting any completion time because the processis subject to regulatory review and possible delay,” addedRice.

HarborOne has already submitted its application to obtain FDICinsurance.

“The FDIC won't give us any indication of acceptance until afterthe NCUA and the Massachusetts Division of Banks give theirapproval on the member vote (certification),” Rice said.

Because of regulatory constraints, Rice said HarborOneCEO/President James Blake will not be making any comments untilafter all of the approvals are secured from NCUA, MassachusettsDivision of Banking and FDIC, the credit union said.

HarborOne will continue to operate as a credit union until theclosing of the charter change transaction.

The NCUA also declined to comment Monday.

Operating as a credit union since 1917, HarborOne has grown tobecome the largest state-charted credit union in New England.Nevertheless, the longstanding credit union has said its reasons toconvert were the flexibility to expand HarborOne's markets andcustomer base, increase its lending authority, including smallbusiness lending, and gain access to additional capital.

HarborOne's President/CEO James Blake has told Boston media thatbecause HarborOne's field of membership is limited to fourcounties, the credit union has been forced to turn down $70 millionin mortgages and other consumer loans from potential members wholive outside its market.

Soon after the conversion plan was announced Feb. 16, 2012 andapproved by HarborOne's board a month later, it sparked anindustry-wide debate and criticism from some credit unionleaders.

Except for the $1.7 billion Technology CU of San Jose, Calif.and a few smaller CUs with conversion plans, there has been a lullin activity. Tech CUmembers overwhelmingly voted last fall not to convert theirinstitution to a mutual bank. Of the total 18,000 votes cast,14,000 voted no to the conversion and 4,000 voted in favor ofit.