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What’s In A Name?

An open letter to members in response to recent events in the banking world.

Dear Pacific Crest Members,

Beginning on Friday, March 10th the 24-hour news cycle became all about banks, deposits, deposit insurance, and risks in the banking industry.

Similar to banks, credit unions offer checking and savings accounts, loans, and electronic banking services.  It has been said that “if it walks like a duck and quacks like a duck, then it’s probably a duck.” When comparing banks and credit unions, this old adage doesn’t hold true.

Banks are for-profit corporations and most are owned by stockholders.  Stockholders and the Market expect quarterly returns, stock value increases, and in many cases stock dividends to be paid.

Credit Unions are not-for-profit cooperatives.  When someone opens a membership account at Pacific Crest Federal Credit Union, they become one of 20,000+ members like you and I who each own one equal share in the credit union.  Credit Unions, at their heart, are a group of people cooperating together for mutual financial well-being. We exist to serve the long-term needs of our members and the communities of Klamath, Lake, Modoc and NE Siskiyou Counties that we are chartered to serve.

Because our structure is different, our risk and operations function differently than a bank.  We don’t have to focus on making more money this quarter than we did last quarter.  We’re not worried about keeping stockholders happy, and therefore, there is less risk in our balance sheet. We have a long history of keeping significant liquidity available to meet our member’s needs.  This may mean that we don’t generate as much revenue, but it also means we don’t have the risk exposure.

Less than 25% of our deposits and loans are from businesses. This ratio is the opposite of most banks.  We serve individuals, couples, and families.  We don’t have a few large clients who account for the majority of our business, and we don’t primarily serve a single industry.  Our members are as diverse as our communities.  Our members derive their income from agriculture, manufacturing, retail, service, government, education, and natural resource jobs to name a few.

Pacific Crest began 87 years ago as the Loyal Legion of Loggers and Lumbermen Credit Union.  Over the years our name has changed to better reflect changes in our charter and who we can serve, but the ownership has never changed.  We are 100% owned by you, our members.  Because of our structure, we think long-term and avoid high-risk scenarios.  Our goal is to ensure we have a stable business that will be here as your financial partner to serve you and your loved ones for another 87 years.

Because of our structure, we are also regulated differently.  While banks are regulated and insured by FDIC, Credit Unions are regulated and insured by NCUA.  Both FDIC and NCUA are Federal Agencies and both insure an individual’s deposits up to $250,000.  Because of the Credit Union’s focus on individuals and families, there are additional ways deposits above $250,000 are often insured.  If you have questions about deposits above $250,000, I encourage you to stop by a branch to discuss insurance with one of our experienced team members.

The structure of Credit Unions has time and again shown its resiliency during difficult economic times.  Pacific Crest is designated as “well capitalized” by NCUA.  As always, our monthly financial statements are posted in the lobby of each branch for our members to review.  We have been headquartered in Klamath Falls and served Klamath County for 87 years and our focus is to serve this, and the next generation of people who call this region our home.


Chad Olney
Pacific Crest FCU

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