Rooted in region, Charter Oak builds brand by serving members, community

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Waterford — Eighty years ago, 10 shipyard workers stuffed 25 bucks apiece into a shoebox in a pooling of resources that launched the Groton Shipbuilders Federal Credit Union.

As acts of faith go, it turned out to have legs.

What those men begat in 1939 has grown into the Charter Oak Federal Credit Union, a financial engine with assets approaching $1.2 billion and a penchant for largesse that benefits fellow nonprofits throughout New London and Windham counties. Which is more iconic, its curvy-roofed headquarters on Route 85 here, or its orange-trimmed, thick-barreled pens that seem to be everywhere?

"It's a tremendous marketing tool," Brian Orenstein, Charter Oak's president and chief executive officer, said of the headquarters, a $21 million, 55,000-square-foot edifice that houses one of Charter Oak's 16 branches.

"It's big, it's splashy," Orenstein said. "When it opened in 2014, we took off."

As a credit union, as opposed to a bank, Charter Oak exists to serve its "members" — every man, woman and child who opens a Charter Oak deposit account, be it checking, savings or certificate of deposit. Every member/owner has a say-so in governing the institution, whether that member has $1 million or one dollar on deposit, Orenstein said.

The seven duly elected members of Charter Oak's board of directors and the three members of its supervisory committee serve without compensation. Charter Oak's nonprofit status exempts it from federal income taxes.

Such circumstances typically enable credit unions to pay higher interest rates on savings accounts and to charge lower rates on loans than banks can. Unlike banks, however, credit unions are restricted by their "field of membership," a legal definition of who can join.

In Charter Oak's case, the restriction is geographical, limiting the area it can serve to the two eastern Connecticut counties specified in its charter. In the days when it was the Groton Shipbuilders Federal Credit Union and later the Electric Boat Federal Credit Union and then the Electric Boat Community Federal Credit Union, it primarily served Electric Boat employees.

Charter Oak adopted its current name in 1991.

"Anyone living, working, worshipping or going to school here (in New London or Windham counties) can be a member," Orenstein said. "It's a population of about 375,000 people and we have more than 70,000 members."

Charter Oak started a membership campaign when it moved its headquarters to Waterford from Groton. It’s the largest credit union in the region and the third-largest in Connecticut, where credit unions tend to be small. Charter Oak’s main competitors are Chelsea Groton Bank and Norwich-based Dime Bank, both of which also observed milestones this year. Chelsea Groton turned 165 years old, Dime 150.

Charter Oak has ranked as the top residential mortgage lender in eastern Connecticut in each of the past nine years. Since 2010, it has originated 9,157 residential mortgages with a combined value of nearly $1.2 billion. In 2018, it granted nearly 800 residential mortgages with a total value of nearly $98 million — a market share of 11 percent.

The credit union also had about $157 million in business loans and commitments as of Sept. 30.

Nonprofits in the region are among Charter Oak’s biggest fans, especially since the 2016 launch of its Matching Gifts program. Charter Oak matches dollar-for-dollar the donations its members make, providing, in 2018, nearly $400,000 for 345 charities hand-picked by members.

“It’s pretty phenomenal,” Wendy Bury, executive director of the Southeastern Connecticut Cultural Coalition, said of Charter Oak’s giving. “They’re great champions of the region.”

Bury noted that Charter Oak also benefits nonprofits through the free use of its headquarters’ community rooms — space organizations would otherwise have to pay to book. Free parking and on-site amenities are part of the package. Bury said her group arranges meetings at Charter Oak headquarters several times a year.

Charter Oak and its employees have long been among the top supporters of United Way charities, and the credit union has for years awarded a $2,000 college scholarships to a graduating senior at each of the more than 40 high schools in the two-county region.

Despite Charter Oak’s high-profile accomplishments, Orenstein finds he still has to dispel persistent misconceptions about credit unions.

“Some people think they’re too difficult to join, that they’re too small, that they’ll have trouble getting their money out,” he said. “Because of the name, there’s the myth that they only serve union members or that they’re only about providing credit.”

“Call us a bank if you want,” he said. “We like to say we do everything banks do, just better.”

Orenstein said Charter Oak is comfortable with its current network of branches, several of which have been added or upgraded in recent years, extending coverage from the southeastern Connecticut shoreline to the Massachusetts border. Two of the branches are in high schools — Fitch in Groton and Killingly — and two are in workplaces — Electric Boat and Mohegan Sun.

“We still have to get our message out,” said Orenstein, who eschews a secretary, preferring that calls be put through to him.

As for the pens, he encourages employees to leave them all over.

But people are going to take them, one protested.

“I know, I know, that’s what we want,” Orenstein recalled saying. 

“Banking that clicks.”

b.hallenbeck@theday.com

Charter Oak Federal Credit Union

Business Snapshot:

Name: Charter Oak Federal Credit Union

Headquarters: 1055 Hartford Turnpike, Waterford

President/CEO: Brian Orenstein

Assets: $1.16 billion

Employees: 210

Website: CharterOak.org

 

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