Maine Savings FCU: Barco FCU's new name not hiding that it's a CU, but not advertising it either

HAMPDEN, Maine – John Reed, president/CEO of Maine Savings FCU, formerly Barco FCU, said he wants instant recognition among consumers that Maine Savings is a financial institution, whether they put together the fact that it’s a credit union isn’t that important. On Sept. 24 the credit union officially changed its name to Maine Savings FCU. When you call the credit union you are greeted by a friendly attendant who says “Good afternoon, Maine Savings.” The term credit union is not mentioned and Reed says it’s not a slap in the face to the credit union charter, which he is a big fan of, but a recognition that consumers are going to quickly identify Maine Savings as a financial. “It’s strictly marketing. We wanted our members as well as other consumers to immediately know we are a financial institution. Our members don’t care about the corporate structure of our charter. They simply want exceptional service and good competitive rates and fees,” said Reed. NCUA requires that “federal credit union” be included in a FCU’s branch signage, but there are a lot of places it isn’t necessary, such as CU garb worn by employees. There will be no mention of FCU on logo clothing and in certain advertisements said Reed. Even the CU’s new logo (shown here) downplays “federal credit union.” It appears in much smaller font below the large font of “Maine Savings.” NCUA has become less strict in recent years about using so-called tradenames. It stated in a 1997 legal opinion letter that while the full credit union charter name must be used in legal documents, including member disclosures, there is leniency with advertising. NCUA stated the following: “It is now our opinion that an FCU may use a tradename in advertising, such as signs, as long as the advertising complies with the provisions of Part 740 of the NCUA regulations. Briefly summarized, this means that advertising must not be inaccurate or deceptive or misrepresent a credit union’s services.” The name BARCO FCU came from the CU’s original sponsor, the Bangor & Aroostook Railroad Company, which now makes up a very small portion of the CU’s 24,000 members. The railroad only employs about 300 people. Reed said his nine-member board has five directors who came from the railroad and wrestled with the idea, but eventually determined it was in the best interest of the CU. “The board looked at the credit union marketing being done both nationally and statewide and it all says you have to tell members that we’re democratically-controlled and not-for-profit. I guess that can make sense, but if our service was terrible and rates were terrible, those members wouldn’t do business with us even though they own us.” A handful of long-time members have called concerned about the name change. Reed handled them all personally and said they now support the reasoning behind it, but he also had a question for them. “I asked them if they cared so much about this kind of thing why hadn’t any of them showed up at the annual meetings in the 11 years I’ve been here.” Those who live or have lived in Maine will know why the name “Maine Savings” has added intrigue. It was the name of one of the state’s most successful consumer financials until the mid-’80s. It was eventually swallowed up by Fleet bank. About four years ago Reed did some research to see if the name was protected. It wasn’t and the CU jumped in and protected it for future use. “They were a very good consumer bank for many years. We did surveys in the state and within our membership to see if there were any negative connotations of the name. There were none.” The CU is currently in the midst of a TV, print and radio ad campaign touting the new name. Reed stressed that the CU has no interest in converting to a mutual savings bank, which the name sounds eerily like. “No way. The credit union charter is very important to us.” This name change, said Reed, is just in stride for this innovative CU, an owner in CUSO Mortgage Corp., which holds about $200 million in servicing loans on its books. Reed is president/CEO of the CUSO, and has helped make the CU a strong player in mortgages. The CU has also had a number of mergers over the years that have made it the No. 1 CU in Maine in terms of members. “We continue to expand. We have six branches and over the next few years we want to develop between three and six more,” said Reed. [email protected]