South Sound credit unions see boost from Bank Transfer Day

It’s been a good week for credit unions. A good quarter. A good year.

The state’s largest credit union, BECU, is reporting that it counted 699 new members on Saturday, otherwise known as “Bank Transfer Day.”

Compared with a typical Saturday, that’s an increase of nearly 40 percent, said BECU spokesman Todd Pietzsch.

”It is not slowing down,” he said.

On Monday, the credit union welcomed 799 new members.

Seattle Metropolitan Credit Union is reporting a 215 percent increase in new accounts, said David Bennett, spokesman for the Northwest Credit Union Association.

He’s been polling credit unions throughout Washington and Oregon.

“I’m hearing record numbers from every one of them,” he said.

The increases, Bennett suspects, come thanks to consumers who have become frustrated with large, national banks.

And it didn’t start with the Occupy Wall Street movement, or with the grass-roots Bank Transfer Day call-to-action.

Think back to the 2008 collapse of WAMU, the bailouts and the anger that followed a recession in which America found that many small businesses were not too big to fail.

“We had a pretty steady 4 to 5 percent increase per quarter following the WAMU collapse,” Bennett said. “It wasn’t just a one-time increase.”

Linda Jekel, director of credit unions for the state Department of Financial Institutions, said Tuesday that by the end of the second quarter of 2009, credit unions with headquarters in Washington reported $24.9 billion in deposits, or approximately 18 percent of all deposits held by banks and credit unions in the state.

A year later, the credit union share rose to 19.3 percent.

By 2010, the figure stood at more than $27 billion, or 20 percent of all deposits.

Figures concerning the market share of banks in the state – which banks have what percentage of the business – will not be released by the Federal Deposit Insurance Corp. for several months.

A spokesman for the Washington Bankers Association was not available for comment Wednesday.

Credit unions have been planning for the increase in share.

“For the longest time, we’ve talked among ourselves,” Pietzsch said. “If we could get people to consider credit unions, they would make the move. On September 29 there were the Bank of America fees, then the Occupy events came almost simultaneously. It was the perfect storm. People are frustrated. I think that frustration has added up and added up to where people are taking action. The CEOs I’ve talked to are happy after all these years of trying to get the word out. This was an opportunity they’ve been preparing for.”

Statewide, over last weekend, credit unions received 1,430 new members.

In the month between the announcement of the Bank of America fees and Halloween, Washington and Oregon credit unions counted 34,000 new members, Bennett said.

That equals more than 30 percent of the total number of accounts opened in all of 2010.

The Credit Union National Association reports that on Bank Transfer Day, institutions nationwide added 40,000 new members who deposited $80 million into their accounts.

The association also reports this week that credit unions “made about $ 90 million in new loans” on Bank Transfer Day.

Now comes the tough part.

Jekel, the state’s chief credit union regulator, said, “I think the big challenge is what credit unions will do with the money.”

The credit unions need to maintain a “net worth ratio” above 7 percent. All state credit unions are currently in compliance, Jekel said.

Meanwhile, statewide, “delinquencies are down, charge-offs are down and earnings are up,” she said.

It’s been a good ride, said Bennett.

“This is going to go down in credit union history.”

C.R. Roberts: 253-597-8535

c.r.roberts@thenewstribune.com