Jeremy Pinard isn’t sure what 2023 holds for the economy and lending. But the Vantage West Credit Union chief lending officer plans to navigate any environment while balancing the portfolio at the $2.6 billion asset credit union in Tucson, Ariz.
While just two years into his role at Vantage West, Pinard has been in the credit union industry since 1999. The CUNA Lending Council executive committee member has seen everything while working at credit unions with assets ranging from $150 million to $16 billion.
He recently spoke with Credit Union Magazine about the lending landscape, liquidity issues, advice for young lenders, and more.
Jeremy Pinard: I wish I had a crystal ball in January 2022 because I never saw this liquidity crunch coming, or at least not so fast. We probably would have made a few different decisions, even though we're having an incredible year.
The liquidity crunch is probably the most unique thing I've dealt with in my career. I worry about some of the credit unions that haven't been raising rates quick enough.
Another unique part of 2022 was the competition for high-performing talent. We're starting to see that level off.
A: It's going to be a challenging year. But we’ve made the commitment to invest in technology infrastructure so when we come out of the recession—depending on how deep and long it is—we'll be ready to compete in a scalable fashion.
We're a big indirect lending shop. We have about $1 billion in auto loans on the books. We did a lot when values were extremely high the past couple of years. Now, when these values come down and manufacturers start offering crazy incentives, what does that mean for our portfolio?
Defaults could be similar to 2008, when people would get another house before they walked away from their current house. I think that will happen with our car business.
People are going to realize they have a 2020 suburban they overpaid for, and now they can get a 2023 at the same price they owe. They’ll get that suburban and walk away. We have to account for that.
There will be rough waters, but there will be huge opportunities for credit unions when this recession period brings rates down.
We’re setting up refinance partnerships. People are going to refinance, and if you're not in front of your members ahead of time, someone else will be.
A: For us, it's about creating a more balanced portfolio. We're a huge auto lender, but we need diversification through building our home equity line of credit book of business, getting mortgages, rounding out the portfolio, and creating levers to pull when we need them.
We’re focused on building out a capital market strategy. We have a mechanism to price loans that we run on our books.
But how do we price and structure loans that are scalable on the secondary market so we don't have to shut off our funnel?
A: Don't overestimate the scenarios you think are going to happen. Build a lending plan that says, if this scenario happens, this is what we can do. If this happens, we can adjust and be OK. Create optionality in your lending business.
It's important to build an operationally efficient, scalable model. We want to be everything to all members because they’re our owners. But know where you can compete, where to partner, or when to get out of a business.
A: I worry that we're not developing the talent we need, especially in lending and executive leadership.
I understand the decision to go outside of credit unions for talent, but why can't we develop executive and lending leadership in our ecosystem?
A: I have two kids: a 5-year-old son and 8-year-old daughter. That's keeping us busy. I coach both of their soccer teams. I enjoy coaching. I coached for a long time, got out of it for many years, and I’m getting back into it now.
I turn 50 this year and I've committed to doing a half marathon on my birthday. So I’m trying to get back in shape.
A: The show I'm watching right now is “Yellowstone.” But the book every leader should read is “Extreme Ownership: How U.S. Navy SEALs Lead and Win,” by Jocko Willink and Leif Babin.