This year, for the first time, Forum has passed Indiana Members Credit Union on IBJ’s annual list of the largest Indianapolis-area credit unions (see page 28). What’s more, with $913 million in assets, 84,159 members and 11 branches, Forum has a market foothold on par with some well-known local banks, such as the National Bank of Indianapolis and Plainfield-based Lincoln Bank.
On Aug. 9, Forum will formally dedicate the latest symbol of its financial services firepower, a $25 million expansion of its Fishers headquarters.
The steady growth, which has more than tripled assets over the past decade, is all about providing members what they want, CEO Gary Irvin said.
“What we do is in response to what members ask for,” he said. “If they don’t get it from you, they’ll go out elsewhere and get it.”
Formed in 1941 to serve Indiana Bell employees, Forum changed its name in 2000. But its transformation into perhaps the state’s best example of the new breed of credit union began 25 years ago with the addition of checking accounts.
Since then, Forum has diversified into nearly every financial service possible: mortgage loans, home equity loans, business loans-even trust and investment management. And the credit union is still looking for new revenue streams. Its IT division, Forum Solutions, markets credit union software to the rest of the industry. And the headquarters expansion includes a showcase conference center Forum leases out for events from company meetings to wedding receptions.
Banks regularly bemoan credit unions’ nibbling away at their market share. They say credit unions like Forum have swollen far past their traditional role of providing basic financial services to employees at a particular company or group of companies. Because credit unions pay no federal taxes, banks complain they have an unfair advantage.
“Our concerns are very much about seeking a level playing field. The credit union industry was formed for a very narrow purpose back in the ’30s, and that has all changed since that time,” said Joe DeHaven, CEO of the Community Bankers Association of Indiana. “It’s time for them to become taxpaying financial institutions, to have to deal with all the same regulations that the banks deal with.”
But Indiana Credit Union League President John McKenzie argues that the role of credit unions remains the same.
They are still owned by their members, he pointed out, with each one holding an equal share no matter how small or large his account. And credit unions’ tax savings are passed on to those members, in the form of lower borrowing rates and fees. Last year alone, he said, Hoosiers credit union members saved $160 million, compared with what they would have paid at banks.
“That structural difference is what distinguished credit unions 40 years ago, and still distinguishes them today,” McKenzie said. “The big picture is the banks still hold more than 90 percent of the assets of all depository institutions. And the banks are enjoying record profits.”
As the debate rages, Irvin remains focused on further expansion. He’s not interested in conceding customers to banks, and he doesn’t think his members would want him to.
“It’s a new world. It really is,” Irvin said. “We’re just here to maximize our value to members.”