In October CUNA presented the 2012 Community Credit Union of the Year Award to four credit unions for their exemplary displays of movement principles and positive influence in the field of service.
Winners with more than $250 million in assets included First Community Credit Union, Jamestown, N.D., and 1st MidAmerica Credit Union, Bethalto, Ill. (honorable mention). Winners with less than $250 million in assets included Gulf Coast Community Federal Credit Union, Gulfport, Miss., and Dakotaland Federal Credit Union, Huron, S.D. (honorable mention).
Representatives from the firstplace winning credit unions—Gulf Coast Community Federal’s Executive Vice President/Chief Communications Officer Debbie Pidek and First Community’s President/CEO Steve Schmitz—participated in a Q&A with Credit Union Magazine about what it takes to be a great community credit union.
CU Mag: What about your credit union makes you most proud?
Pidek: We’re most proud that the programs we put in place to help credit-challenged and low-income members help us make a positive difference in our community. We were one of the first credit unions in the U.S. to send our entire lending department, including payment solutions (collections), through CUNA’s Certified Credit Union Financial Counselor program.
Our lending philosophy of understanding that bad things sometimes happen to good people enables us to couple that compassionate lending mindset with the financial counseling expertise required to truly help our members achieve their financial goals.
Schmitz: During the economic downturn, at a time when other financial institutions were struggling and pulling back, we experienced record growth in loans and deposits, while maintaining historically low delinquency and chargeoffs. We were lucky because North Dakota didn’t experience some of the issues other parts of the country had to deal with. We felt we were very stable financially so rather than sit back, we looked at it as an opportunity; our employees went out and asked for new business, and we were very successful.
CU Mag: What’s the biggest challenge your credit union has had to overcome in the past few years?
Pidek: Hurricane Katrina in 2005 severely affected the Gulf Coast, closely followed by the economic recession and then the BP oil spill. Many of our members are still struggling financially. We had to learn how to lend to people who are credit- and income-challenged.
The market changed, and we had to change the way we did business. Learning to effectively lend to members with C, D, and E paper has enabled us to continue to have positive loan growth during a time when many financial institutions have negative loan growth.
Schmitz: The immense regulatory changes coming out of Washington have been a major burden for our credit union. We have had to add two positions and hire compliance consultants. The challenges in the regulatory environment have taken a lot of staff time and credit union resources. Survival of small financial institutions, both banks and credit unions, is going to be very difficult in this environment.
CU Mag: To be successful, a community credit union must…
Pidek: Always be looking ahead. The market is constantly changing and, to be successful, we must adapt to that changing market. It might sound like a cliché, but it’s a fact.
After the economic downturn, many in our industry continued to do business as usual, but the business environment changed dramatically and permanently. We knew we had to change the way we did business to reflect the new economic environment.
Schmitz: You need the entire staff to have an attitude of “growth” and not be satisfied with the status quo. Be heavily involved in your local communities—from schools and service organizations to local charities, there’s no better advertising than for staff to get involved.
This will pay off. As your staff represents the credit union and establishes relationships throughout the community, business will grow as a result.
Advice From Award-Winning Community CUs
“Celebrate your success. The more you tell your good stories, the more good stories you’ll have! We find we have more and more to celebrate.”
“Understand that the only way to differentiate your credit union from other financial institutions is through your member service. The reality is that we all offer very similar products and services; it’s how we treat our members that draws them to the credit union and makes them want to stay.”
-Steve Schmitz, president/CEO First Community CU Jamestown, N.D.
“Get involved. Make connections. Know your members, your neighbors, your chamber, and key contacts in your communities. Find opportunities to support local groups that match your credit union’s values and leverage those opportunities for partnerships and growth.”
-Amber Scott, vice president, marketing 1st MidAmerica CU Bethalto, Ill.
“Develop a ‘forward-thinking’ business plan—one that’s realistic, has sustainability, and is based on the fundamentals of doing good business. Then properly prepare your staff, take a deep breath, and go after your objective with purpose.”
NCUA has released its new call report form and accompanying instructions, which become effective Sept. 30. For credit unions engaged in commercial lending, most notable are the updates reflecting the January 2017 changes to the member business lending rule.