SAN JOSE, Calif. - When Silicon Valley Credit Union merged with Meriwest Credit Union late last year, it seemed like a perfect fit. It was the largest of the three mergers Meriwest has completed in the past 10 years. SVCU, with 5,000 members and $80 million in assets, was right in the middle of Meriwest's geographic area. Membership demographics of the two credit unions were very similar. Managements of the two credit unions shared similar approaches. "Operationally, the merger went very, very well," Chris Owen, Meriwest president/CEO says. "It was a win, win for both." Oh, yes. The merger pushed Meriwest into the Billionaire's Club. Are local banks sitting up and taking notice? "Not yet," Owen says. "I'm not saying it's not coming. I think the train is going to pull into the station at some point. Any organization needs to grow and any organization needs a market in which to grow. "We've been growing at seven to nine percent a year. In the credit union market, and probably as well with banks, it's been pretty severe the past couple years in terms of both growth of membership and growth of assets. "The merger last year let us grow at actually an abnormal rate of about 11 to 12%. But we had been growing before that. We continue to do well. The outside forces are the outside forces. We're focused on our business. We've got to make sure we maintain a healthy profile and keep delivering credit union products and services to people that want them." Owen has been Meriwest CEO since 1995. After graduating from Franklin Pierce College in Rindge, N.H., with a BA in finance, Owen joined JPMorgan and worked in both New York and San Francisco, primarily in international banking. After 13 years he left JPMorgan for a job with Westpac, Australia's largest bank. Westpac was moving into the U.S. with operations on the West Coast, and hired Owen as essentially their CFO to get things underway. He was there eight years. Then Westpac rethought its approach and shrank its U.S. presence. Owen started looking around and happened to see a newspaper ad for the CFO position at what was then Pacific IBM Federal Credit Union. He joined the credit union in 1991 and became CEO in 1995. "What I did on day one was split the credit union into two major pieces," he recalls. "Product and service delivery is under the chief operating officer and essentially has four departments. Product and service support, which is another four departments, is headed by our CFO." Also reporting directly to Owen are the president of Meriwest Mortgage and the human resources head for the entire organization. As far as Owen is concerned, moving into the Billionaire's Club ranks has been a matter of simply doing the right thing. When Meriwest was Pacific IBM, it perhaps took certain things for granted, such as a common employment or occupational bond among members. When it switched to a community charter, it not only had to change its name, it had to focus on core competencies and prepare to compete with Wells Fargo and other financial giants. Simply by the fact that it was a credit union, Meriwest was member-centric. It wanted to hold onto that bond. Management figured if they could retain that intimacy, members and prospective members would join and stay. That doesn't mean change isn't a factor. "It changes every day. Every day someone is coming up with a new thing. We really have to work hard to make sure the experience of dealing with Meriwest is the best we can make it," Owen says. Success has also meant dealing with changes in the local economy. "We have a little bit larger area, but Silicon Valley specifically had unprecedented growth in the late `90s," Owen notes. "Then the bubble burst and there were a lot of vacant buildings that were never filled. That certainly has come back again." In 2002, 90% of IBM's operations in the area were sold to Hitachi. If Meriwest hadn't already moved to a community charter, the sale would have posed a big problem. Meriwest hasn't been alone. Owen estimates more than 50% of local credit unions, particularly the larger ones, have adopted community charters. Even with about half of Meriwest's membership still having IBM ties, Owen sees changes in the membership. Those changes, he explains, primarily reflect changing lifestyles. As a result, "For the past eight years we've been building branches very differently. Wells Fargo had people in taking photos before we figured out who they were and chased them out. Our new branches don't have teller lines. The member service representatives are more out on the floor. We do cash checks and make loans, but the branches are learning experience places with Internet cafs where you can learn how to do online banking," he explains. But with so many IBM people and other Silicon Valley groups in the field of membership, aren't members more tech-savvy than average? Five years ago, Owen answers, the adoption rate of new financial services approaches by Meriwest members might indeed have been above average. Today the rest of the nation is catching up. It's less of a standout factor. Dealing with Market Pressures For credit unions in general, he continues, membership and asset growth have slowed dramatically. At the same time, in order to maintain economies of scale, Meriwest wants to reduce-or at least increase at a slower pace-operating expenses. It's hard to compete, Owen stresses. Technology is expensive. Community charters are hard to administer. The yield curve is flat. Margins are narrow. "We're probably watching every penny much more so than we have in the past 10 years," he states. Off the job, Owen plays a little golf, but his real passion is sailing. He has a 34-foot Catalina, which he races in one-design competition on San Francisco Bay. "It's always a thrill," he declares. On the job, he enjoys seeing members acquire new cars and homes and send their children to college thanks to financial services from Meriwest. He also likes watching managers grow professionally, and takes pride in the credit union's community involvement. Specific projects include fixing up the homes of autistic children and working with third grade students to improve their reading skills. "At my advanced age of being in my late 50s," he quips, "that's bringing me more and more satisfaction." [email protected]