Credit unions, small banks luring clients

Long Island's credit unions and small banks have geared up for what they hope will be a record wave of new clients Saturday, part of a national, grassroots effort to encourage consumers to bail out of big banks.

Bethpage Federal Credit Union expects as many as 300 accounts to be opened during Saturday's so-called Bank Transfer Day. That's on top of the record 650 new accounts it logged this week, far above the norm of 330.

"It just doesn't get any better than this," Bethpage chief Kirk Kordeleski said Friday.

Bank Transfer Day, started by a Los Angeles businesswoman on Facebook, is a movement born of anti-bank sentiment building since the federal government bailed out big banks in 2008.

For local credit unions and community banks, the recession and big banks' recent attempts to charge fees for debit cards have been a boon. At least four local credit unions have run ad campaigns about extended hours on Bank Transfer Day, touting fee-less services.

"We're trying to take advantage of the climate," said chief executive Frank Cordano of Nassau Financial Federal Credit Union in Garden City.

In recent weeks Bank of America and others have retracted plans for debit card fees, but the damage was done.

"They're always trying to nickel and dime you," said Judy Kaplan of Bethpage, an unemployed bookkeeper who ditched Chase Friday and signed up with Bethpage Federal Credit Union. "I just feel they're holding back loans to businesses and people."

A Chase spokesman declined to comment; the bank's third quarter report cites $1.3 trillion in new and renewed credit for the first nine months of the year. A Bank of America spokeswoman declined to comment.

Robert Allen, chief executive of Teachers Federal Credit Union in Hauppauge, said his institution got a record 1,767 new accounts last month, a 36 percent jump over a year ago. The latest figures show deposits in September were up $100 million from a year ago, he said.

"We're not an unknown entity anymore," Allen said. "When I started working for credit unions, if I said I work for a credit union, it was like, 'What is that?' "

At Islandia-based Gold Coast Bank, $6 million in fresh accounts during the past six weeks pushed its lending power to $40 million, but no one's qualifying for loans, said Joe Perri, head of the bank.

That means the bank isn't making money off its cash, he said: "It's a nice problem to have, but it puts us in a dilemma as to what to do with it."