<p>MIAMISBURG, Ohio – Overlapping fields of membership? No problem, John Bowen figures. In fact, Bowen agrees potential members who qualify to join several credit unions could be in the enviable position of a young woman trying to decide which invitation to the prom she wants to accept. Let the best man win. Bowen is CEO of River Valley Credit Union. In June last year, the $93 million-RVCU converted from a federal to a state charter. The reason was simple: "The (state) field of membership regulations relative to community groups or community charters are much more liberal than under the NCUA guidelines," he says. "Especially over the last three years we had attempted to get a community charter as a federal credit union. We weren't able to get that. The reason was we're located right in the apex of four counties and have members and groups in parts of all four counties. We could never get NCUA to buy off on the fact we were in one community, therefore we couldn't get a community charter." A couple of years ago, the state of Ohio changed some regulations and introduced the idea of community groups. This allows state-chartered credit unions to treat a geographic community much like an occupational group. It's very similar to a community charter, Bowen says, except it allows a credit union to add a community group as it would a company or an occupational group. The groups are defined by geographic boundaries, such as a city, township or county. The boundaries don't have to be contiguous or related in any way. In effect, they're like geographic SEGs. "We were very interested in that," Bowen explains, "and realized we were never going to get the geographic area we wanted under a federal charter. So we decided we would convert and apply for community groups." At this point, RVCU has been approved to serve 11 different community groups in southwest Ohio. Those community groups cover about 75% of the area RVCU wanted to serve. In the majority of those communities, the credit union already had a pretty good concentration of members. However, in same cases there were only a few members. RVCU has more than 13,000 members. For example, the credit union picked up a township and a city in Green County where RVCU doesn't have a great presence currently, but hopes to expand that presence. Bowen expects what he terms a "tremendous increase" in membership. By adding community groups, potential membership of the 14,000-member credit union has grown from 18,000 to more than 500,000. In fact, growth could be a challenge. "The key is to not grow too quickly," Bowen says. "There is only a certain amount you can grow without causing your capital ratios and your income ratios to make you look kind of bad. While you want to grow, you want to do it in a controlled fashion. You have to consider staffing. You need a presence in these communities or you won't get much attention." So the credit union opened an office in West Carrollton last year, and plans to add another facility in Springboro this year. On the plus side, BVCU is well-known in several counties, and it hasn't found it difficult to get invited inside a company interested in becoming a SEG, or to persuade an individual to listen. There are definitely other credit unions in the target areas, including some of Ohio's largest, and they do overlap with RVCU's FOM. "We are looking to remain focused in the areas where we are strongest. While the other credit unions have a presence here, we certainly compete very well and in fact probably are a little stronger in the geographic area where we are now than some of the larger credit unions," Bowen says. "Overlapping under this scenario is not the issue it used to be. We all understand we are competing for the same members in certain areas, and we're all okay with that. We feel whichever credit union is able to provide the best service and the most convenience will be rewarded. While we may take a member or two from each other, that also keeps people out of the banks." In addition, RVCU plans to continue adding SEGs to the 200 it already serves. Bowen figures one plus of adding businesses as well as geographic areas to its FOM is the potential for offering services such as commercial checking to businesses outside the community group boundaries. That means marketing will be aimed at businesses as well as individuals. The list of media buys includes radio, television and newspapers. The current ad fight will continue for a couple more months, ease off, then resume. Overall, Bowen is bullish about the future and the move to a state charter. "If we had it to do over again, we probably wouldn't have spent as much time trying to get our community group under the federal charter. Some federal credit unions have been able to get community charters, and NCUA appears to have lightened up on the regulatory requirements, or at least interpreted them a little differently. "In our situation, because our members come from parts of four different counties, we were never going to be able to keep that entire area. We should have cut our losses and started converting to a state charter much earlier. We really are behind a little bit in terms of the other larger credit unions in the area that are already state chartered," says Bowen. -</p> <p>[email protected]</p>