Many of the credit union movement’s most dynamic leaders have recently retired or soon will. As they do, there’s a growing concern that some of the movement’s vision and values will retire with them. There’s a concern that the credit union flame might not burn as bright. These concerns give rise to a number of troubling questions:
• Will the next generation of credit union leaders share the same passion for, and commitment to, credit union principles?
• Are credit union values still relevant to future leaders, considering the serious distractions and challenges that exist today?
• Will new leaders focus too much on the financials and not enough on members?
• Do former bankers hired as credit union leaders bring a for-profit mentality into the for-service world?
Credit union leaders who “have been around the block a few times” offer some valuable insights and words of caution as they contemplate these questions.
“This is one of the most stressful times in the history of credit unions,” says Dianne Addington, currently interim CEO at $9 billion asset Southwest Corporate Federal Credit Union in Plano, Texas. She spent nearly four decades at Genisys Credit Union in Auburn Hills, Mich., the last 22 as its president/CEO. “Even those who’ve historically been recognized as icons in the industry are struggling.”
“Prior to 1970, there were a lot fewer regulations, the competitive playing field was a lot different, and it was easier to be philosophical,” agrees Carroll Beach, president/chief operating officer of CO-OP Shared Branching. “Each of these things has had a huge impact on our industry that can’t be ignored.” His credit union career spans nearly four decades and includes 30 years as president/CEO of the Colorado Credit Union System.
“Credit unions feel they’re under siege,” adds Wendell “Bucky” Sebastian, executive director of the National Credit Union Foundation. Sebastian spent 20 years as CEO of GTE Federal Credit Union, Tampa, Fla., and was general counsel of the National Credit Union Administration (NCUA) from 1981 to 1985. In most places, he says, credit union loan portfolios are under severe stress and they’re not generating the income they did in the past.
In the face of these challenges, it’s critical to “keep purpose constant,” says Ed Baranowski, president of Topics Unlimited, an education, seminar, and consulting company. He says the credit union philosophy was “drilled into” him during the early days of his credit union career.
Baranowski is a Credit Union Retired Executives (CURE) adviser whose 50-year career included
serving as president at both the University of Wisconsin Credit Union, Madison, and the Navy Orlando (Fla.) Federal Credit Union (now Fairwinds Credit Union). “Sure, we have the ‘fires’ of competition and regulatory issues to worry about, but we need to remember our jobs go beyond that.”
“I’m afraid too many people get caught up in the mechanics of running a financial institution without remembering credit unions’ unique ability to provide desirable services that benefit members,” agrees Sebastian. “The genius of the credit union movement is that it’s an alignment of the best interests of the member and the organization.”
“Don’t take the easy way out,” adds Frank Berrish, who’s been president/CEO at $2.5 billion asset Visions Federal Credit Union, Endicott, N.Y., since 1977. “When you need to generate more income, don’t just lower dividend rates and bump loan rates—this is the type of thinking that could cost us our tax-exempt status. Grow your income by better serving your members.”
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