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Mid-Atlantic Corporate has new cap structure consolidates
MIDDLETOWN, Pa. (7/12/10)--Mid-Atlantic Corporate FCU announced Friday its new membership plan will require a level of capital commitment as a condition of continued membership. It also will consolidate departments and realign staff, which will reduce its full-time employees by 16%. Through the actions, the corporate is building on plans to ready itself for new regulatory realities and other marketplace changes, the corporate said in a press release. "Opinions about what's going to happen with corporates are diverse, from those who want to operate as they always have, to those who are ready to throw in the towel," said Jay R. Murray, president/CEO of the $4 billion corporate. “At Mid-Atlantic, we believe the right course is to recognize the vital role corporates play for credit unions.” Murray says that doesn’t mean it should be business as usual. “The corporate model isn’t broken, as some would say; we perform key functions that most credit unions would have difficulty replicating as efficiently or cost-effectively on their own. But we need to introduce changes where it makes sense that will strengthen both our organizations and the entire movement.” The changes aren't a surprise. Mid-Atlantic prepared members for the planned changes. Marry and other senior managers held town hall meetings in first quarter and spoke about “what’s next for corporates” at chapter meetings, webinars and other events, including Mid-Atlantic’s recent annual meeting. Mid-Atlantic's first step was to introduce a new membership plan requiring a level of capital commitment as a condition of continued membership. To date, Murray says, the corporate has received commitments from 637 members totaling $116.8 million in capital. To achieve and maintain the regulatory “well capitalized” designation, the corporate will monitor its total deposits and introduce a maximum deposit limit for each member. “We’re very heartened by our members’ response, and we are making sure that Mid-Atlantic remains strong and able to support credit unions’ financial service needs for many years to come,” Murray said. “Our members have given us a resounding vote of confidence that they want Mid-Atlantic not only to continue, but to thrive.” In the second step, Murray said, the corporate is adjusting staff levels to meet business levels to ensure Mid-Atlantic's continued strength and efficiency, and its ability to deliver services credit unions need. "At the heart of the staff repositioning is making sure we have the right people in the right places." Most staff changes are the result of department consolidation and a reduction in management. The corporate combined its call centers, marketing and member services have been combined into one department, and its accounting, product strategy and information systems into another. The changes will reduce expenses and enable the corporate to accumulate more capital "adding to our long-term strength," Murray said.
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