The Case of Evangelical Reformed United Church of Christ
Frederick, MD.

Why Evangelical Reformed United Church of Christ (ERUCC) pursued this process

The search for a banking institution that would better suit the church’s needs and match its values was initiated by a simple question in a Sunday morning inter-generational Christian education class on large banks. It was during the time when there was extensive press coverage of the abuses of big banks, the Troubled Asset Relief Program (TARP) and bank bailouts, etc. The questioner asked if ERUCC had examined its banking relationships to determine if they were appropriate, that is, whether they were faithful to our values, given any other constraints we faced.

To pursue this question, the ERUCC member wrote a resolution asking for an examination of the church’s banking relationships and the church consistory approved the investigation. At that time, ERUCC used a bank considered by the congregation to be a regional bank because it was the product of a string of mergers that had occurred a few years earlier. Church members did not consider it a “big bank” since there were numerous banks nearby that were much larger. However ERUCC’s Finance Committee had noticed that the bank had repeated raised fees on the “checking account” side of the business while the “wealth management” side of the bank was becoming less responsive in answering questions and meeting with them. It was time to take a new look.

The steps taken

The Treasurer and Financial Secretary were tasked with evaluating financial organizations that might better suit the church’s needs and match its values. They first identified community banks that were in close proximity to the church so that Sunday morning offerings could easily be deposited. (They also chose to focus on community-oriented, smaller banks to avoid asking if the bank had paid back its government bail-out money.) They developed a questionnaire and used it to obtain information needed for the banks’ evaluations. Three community banks that had enthusiastically participated in the process were interviewed (see a list of some of the topics discussed just below). At the end of the process, they recommended one bank to the Consistory, and their recommendation was approved. The transfer of funds was finalized in 2011.

Some of the areas addressed during the interview with the banks:

• The fee structure and minimum balance requirement.
• The number of transactions permitted per month without additional fees. 
• The fee, per transaction, for those that exceed the base number.
• The availability of on-line banking and statements.
  
• The ease of transfers between accounts.

The outcome

The checking account was transferred to a community bank whose fees are significantly less than those of the original banking institution. ERUCC estimates that hundreds of dollars will be saved annually. The bank is also in close proximity to the church, facilitating the timely deposit of receipts. Approximately $100,000 was moved to this community bank.

The bulk of the congregation’s financial assets were in the form of investments including bequests and endowments from many years ago as well as quite recently. Of those investments which the congregation has the right to determine how they are invested, 100% were transferred to the United Church Funds (UCF), a family of professionally managed, well-diversified and socially responsible investment funds offered to churches and all settings of the UCC.  ERUCC and UCF have similar interests and enjoy a good “fit.” Over $1,500,000 was moved to UCF.