Hudson Heritage Credit Union, based in Middletown, is the latest New York credit union to announce plans to convert to a state charter. The conversion is the most recent example of how changes to the state charter championed by the New York Credit Union Association have made it easier for credit unions to grow to meet member needs.
The charter conversion was approved by the National Credit Union Administration, the state Department of Financial Services and members of Hudson Heritage. The change took effect Jan. 1.
Hudson Heritage dropped “federal” from its name, but like all credit unions in New York, will remain federally insured by NCUA. It also reduced its minimum required deposit for membership from $5 to 1 cent.
Hudson Heritage is the fourth credit union to announce plans for a state-charter conversion within the past year-and-a-half. It follows Sunmark CU, Hudson Valley CU and Northern CU, which converted from federal to state charters.
The Association has long advocated for improvements and enhancements to the state credit union charter. In recent years, the Association has seen several key improvements to the state charter implemented by working closely with the Legislature, DFS and Gov. Andrew Cuomo’s administration.
The Association has successfully worked with stakeholders in state government to:
- pass a law that allows state-chartered credit unions to mix and match fields of membership;
- improve the process for obtaining low-income designations;
- ease restrictions on school banking programs;
- lower the minimum interest rate to be paid by state-chartered financial institutions on escrow accounts in connection with loans secured by mortgages on one-to-six family residences;
- issue guidance that encourages state-chartered financial institutions to establish banking relationships with properly run marijuana and hemp businesses; and
- sign legislation into law that allows credit unions to participate in the state Banking Development District Program.
“Several critical state charter improvements have recently been made and it is satisfying to see that more credit unions are reaping the benefits of the state charter,” said Association President/CEO William J. Mellin. “The Association will continue its efforts to work in tandem with the DFS and state lawmakers to ensure our state charter remains a viable and competitive alternative to the federal charter.”