Not too long after arriving in the United States from Portugal, I visited a local Newark bank for the purpose of opening an account with them. I was greeted by one of the bank’s customer service representatives, who was more than happy to sit down with me after I informed her that I was there to open a new account at the bank. While the bank’s representative was taking down all my information, I happened to notice another customer who walked through the door.

The man stepped into the bank with a hesitant stride, as if he wasn’t entirely sure that he would be welcome inside. Taking off his hat and holding it in his hands deferentially, he sat down in front of another of the bank’s representatives, close to where I was sitting at the time. I was admittedly curious about the individual and couldn’t help but listen in on their conversation. As it turned out, the man already had an account at the bank and was there to apply for a small loan. The representative quickly informed the individual that, because he did not have an established credit history, the bank was unwilling to provide him with a loan of any kind. With little more in the way of explanation, the bank representative sent the man on his way. Obviously disappointed, the man got up to leave, still holding his hat in his hands, when he noticed that I also spoke his native Portuguese. I can still remember his comments to me that day: “They are happy to take our money when we come to deposit it here, but when we need help, any excuse is good enough to send us away. The bank won’t give us loans because we don’t have credit histories – but how will we ever have credit histories if we can’t get a loan?”

The man’s words stayed with me long after our brief encounter. I realized he had spoken in terms of “us” and “we”, as if we were both part of the same community. Looking around, I realized he was right. We were surrounded by employers and employees, shop owners and customers, all speaking the same language and sharing a similar heritage. We were, in fact, part of a community. Yet when it came time for any of us to look for assistance to help realize the dreams that had brought us all here, the members of that community had no choice but to turn to outside institutions, banks that had little desire to help individuals whose financial backgrounds did not make them typical candidates for loans. What was needed was a financial institution where the particular needs of our community could be met, a place where an individual could not only deposit his hard-earned funds but could also walk in and proudly apply for a loan without having to hold his hat in his hands.

With a clear vision of what the community needed, I organized a group of fifteen other individuals who hailed from my part of Portugal and set about making that vision into a reality. It would prove to be a difficult and long road to travel. Opening a commercial bank would have required us to come up with a few million dollars in capital. Needless to say, we didn’t have those kinds of funds at our disposal. So, in early 1980, after about a year of organizing and working towards our goal, we applied for and were granted a charter to open a credit union. We now had a charter that allowed us to accept deposits and make loans to members of our community. There were a few rather glaring problems at this point, however: we had no deposits, no loans and no funds with which to pay rent and salaries, buy equipment, pay for utilities and so on. The solution turned out to be one steeped in the traditions of our heritage – we simply put our faith in the people we sought to help and in each other. As difficult as it is for some to believe today, the initial capital for Lusitania Federal Credit Union came from that small group of organizers, who were more than happy to provide the funds with nothing more than I.O.U.’s in return.

Lusitania Federal Credit Union soon began to show signs of being a success – the community finally had an institution that understood and could provided for its unique needs. Seeking to capitalize on Lusitania’s success, multiple copy-cat institutions popped up in the years that followed. Few seemed to realize, however, that the success of Lusitania Credit Union was not built upon a desire to maximize profits, but rather upon a genuine desire to help the community. Not surprisingly, therefore, many of those institutions went on to be re-organized, bought out by large banks or simply disappeared.

Despite Lusitania’s successful history in real estate lending to the community, our federal regulator, the N.C.U.A., decided in the early 1990’s that having more than 25% of our loan portfolio in the form of real estate loans was too risky. Although we strived to explain how the nature of our community itself made real estate lending here less risky than it believed, our regulator simply would not be convinced. Accordingly, we were forced to seek another form that would allow us to continue real estate lending to our community. What followed were challenging times that even we had not foreseen. The N.C.U.A. strongly opposed the idea of Lusitania leaving its regulatory umbrella, fearing that other credit unions would follow suit. Nonetheless, in 1995 Lusitania successfully converted to a mutual bank charter, making U.S. history in the process by becoming the first credit union to ever convert to a savings bank.

We’ve grown even more since then, but to this day, Lusitania Savings Bank continues to use its original motto, “O Nosso Banco” (or “Our Bank”, in English). I believe that the motto – along with the Lusitania name, our logo, our Board of Directors, our annual picnic and everyone who works at Lusitania Savings Bank – serve as a reflection of our commitment to Lusitania’s founding ideals: to be an institution born of the community and for the community, a place where an individual who walks through our doors can be treated as a member rather than as a client. I take great pride when someone tells me that Lusitania lent them money to buy their first car, to furnish their home or to send their child to school. I take even greater pride knowing that these individuals didn’t have to walk in with their hats in their hands in order to get their loans.

None of the above would have been possible without your continued faith in us. We are grateful for the opportunity to have served your needs over the last 30 years and look forward to doing so for many more years to come.

Augusto A. Gomes