Editors note: The white paper has been updated as of May 1, and CUNA economists will continue to update the forecasts as more data is available. 

The U.S. economy has rapidly entered into a recession due to the coronavirus (COVID-19) pandemic, and a new white paper from CUNA examines the overall impact on credit unions and how credit unions with certain characteristics may perform.

“If the coronavirus crisis is, in fact, relatively short-lived and the economy recovers quickly—as many hope and expect—credit unions may simply need to weather the worst of the storm for several months until the economy starts to recover,” says CUNA Senior Economist Jordan van Rijn, author of the paper. “However, many credit unions—such as those serving particularly vulnerable communities—may face more challenging circumstances and difficult decisions.”

The white paper offers several strategies on how credit unions can respond to the challenges COVID-19 presents:

• Communicate regularly with members, employees, and the board. Members should have clear information as to the plans and direction of the credit union during the crisis. Credit union employees should have an idea as to how the credit union plans to keep them safe, any changes to benefits or compensation, and expectations for work schedules and requirements. The credit union board should be kept apprised of any major developments.

• Consider how to support members. Credit unions might—to the extent that they are able—consider creating new and unique products and services specifically designed to help members through the worst of the crisis. Credit unions may also want to consider how to check in on members and maintain efforts at financial education and counseling.

• Consider how to support employees. Credit unions are demonstrating numerous ways of going above and beyond to support their employees. Employees might also need more flexible hours to care for their children, access to retirement or other savings, or additional paid time off.

• Reconsider your strategic plan. More than likely, many of your credit union’s plans for 2020 will need to be set aside or delayed. Credit union leadership may need to resist the urge to press forward with long-term goals and refocus on simply weathering the current crisis.

• Forecast different scenarios for the credit union’s financials. Although it is difficult to predict exactly what will happen in the coming months, it is nonetheless helpful to have some idea as to the direction that different operational indicators might move. Many credit unions are beginning to consider different scenarios and it is helpful to contemplate a range of possibilities, from worst-case to best-case.

• Review your credit union’s mission and vision statements. In times of crisis, it may be helpful for credit union leadership and its employees to remind themselves of why they do what they do. What is the “big picture” goal of the credit union? Reminding ourselves of this vision will help credit unions when adjusting plans and facing difficult decisions.