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Missoula Federal changes name to Clearwater Credit Union to reflect expansion

After 63 years, Missoula Federal Credit Union will change its name in September as part of its continuing expansion into communities outside Missoula.

Announced to members in a Wednesday morning email from president and CEO Jack Lawson, Missoula Federal will change its name to Clearwater Credit Union on Sept. 3.

“We weighed our affection for a name that we’ve been proud to carry for all these years against our responsibility to prepare the credit union for the future,” Lawson wrote. “In the end, our Board of Directors unanimously agreed that as we grow to serve more communities, we need a name that ensures the people in these communities know they belong here too.

“A name that reflects our local roots as well as our commitment to being a force for good. A name that highlights to our dedication to being transparent and reminds us of everything banking can be.”

The name change reflects a larger move by Missoula Federal to grow its membership by expanding beyond Missoula County, as dictated by the five-year strategic plan adopted by the credit union’s Board of Directors in March 2017.

“MFCU is a mid-sized credit union,” the strategic plan explains. “Yet the industry as a whole is moving rapidly toward larger scale in order to take advantage of the benefits that size brings to financial services providers.

“Small banks and credit unions are merging into larger banks and credit unions. Larger banks and credit unions are becoming larger still.”

Rather than pursue mergers with either smaller or larger credit unions, though, the strategic plan called for Missoula Federal to adopt a “values-based approach” to member recruitment – and to look across a wider geographic area.

That move actually began in 2002, when the credit union’s charter was expanded to service “anyone who lives, works, worships, attends school, volunteers in, or participates in membership-based organizations headquartered in Missoula, Ravalli and Lake counties.”

MFCU opened its first branch outside Missoula in 2006 – in Stevensville.

With the new strategic plan in hand, the credit union gained approval to serve four additional counties in 2018: Beaverhead, Deer Lodge, Granite and Silver Bow.

As of 2019, Missoula Federal has more than 50,000 members and manages more than $500 million in assets.

“As we’ve grown to reach more communities outside Missoula, we’ve had to ask ourselves whether the name Missoula Federal Credit Union, a name that has served us well for 63 years, will continue to serve us in these different communities,” Lawson said in Wednesday’s announcement.

In its strategic plan, the credit union took a detailed look at Missoula’s increasingly competitive market for financial institutions.

“There are approximately 11,500 independent banks and credit unions operating in the U.S.,” the strategic plan explains. “That translates to about one financial institution for every 28,000 people in the U.S. If that level of competition carried over into our local market, there would be 6 or 7 financial institutions. In fact, there are 18.”

And three of those institutions are relatively recent additions to the Missoula-area market: Stockman Bank, Horizon Credit Union and Parkside Credit Union.

“These new entrants are adding branches, recruiting talent and expanding the range of options available to local consumers. The market expansion strategies and resource commitments that are implied by new entrants put enormous pressure on their management teams to win new market share. This leads to aggressive marketing, pricing and underwriting,” MFCU’s strategic plan continues.

“Furthermore, all of our most important prior competition – First Interstate Bank, First Security Bank, Opportunity Bank, Farmers Bank, Trail West Bank, Wells Fargo and US Bank, plus the new entrants mentioned above – enjoy significantly larger markets than does MFCU. They are able to take advantage of more opportunities and to spread risks over larger markets than can MFCU.”

In a more detailed look at the name change provided with Lawson’s email on Wednesday, credit union officials described the 18-month process that convinced board members to, first, change the name and, second, to select Clearwater Credit Union.

That process, the board said, “revealed that while we will always love the name Missoula Federal Credit Union, it hinders a sense of belonging for non-Missoulians and limits our ability to demonstrate our values in new communities.”

The credit union conducted a number of surveys – both of its Missoula-based members and those in outlying counties and communities. The overall result showed a generally positive attitude toward the name change, with the credit union’s larger competitive challenges taking precedence over its eventual name.

And among credit union members and potential members outside Missoula, the name was often a hindrance.

One focus group participant, for example, said this: “I would be willing to bank there if the interaction would still be in Butte. But the name is just too in your face. It doesn’t have to have the word ‘Butte’ in it, but having the word ‘Missoula’ in it isn’t helpful.”

Focus group and survey participants were less certain of their response to the credit union’s emphasis on value-based banking, with many saying they weren’t sure what the term means.

The name change could help with solidifying a connection to shared values, but only if the credit union followed up the written commitment with action on the local level – in all its communities, the various respondents said.

In Wednesday’s announcement, the credit union said an advisory team spent five months reviewing about 500 potential names “and Clearwater stood out as the clear choice.”

So why “Clearwater?”

“The name celebrates our roots in Missoula County, which is home to both Clearwater River and Clearwater Lake,” the credit union said. “Water sustains us all, no matter where we’re from. The new name is universally appealing and a celebration of Montana’s lakes, rivers, and streams. The name gives us the opportunity to speak to a key element of our core values: transparency.”

The credit union also will remove “federal” from its name as part of the Sept. 3 change. Here’s that explanation:

“While we remain federally chartered and insured, removing ‘Federal’ from our name makes it shorter and more pleasing to say. In doing so, we reduce the tendency to shorten our name to an acronym. Given all our name stands for, we want to be known first and foremost as ‘Clearwater.’ Removing “Federal” from our name also gives us the flexibility to become a state chartered, rather than federally chartered, credit union in the future should we together agree to make that shift.”

The credit union will adopt a new logo as part of the change, and that too was unveiled Wednesday. More information about the rationale for the name change is available at this link. 

Missoula Federal was founded in 1956 by eight Missoula police officers who pooled their savings and made loans to one another. They incorporated as Missoula Federal Credit Union (MFCU), and each of the original eight members contributed $40.