Changes in Return of the Member (ROM) Reflect Market Changes

Rather than evaluate credit unions’ on profitability measures, Callahan’s Return of the Member scoring system evaluates how well credit unions serve their members and fulfill their mission statements. Find out what changes we made to ROM in 2006.

 
 

Callahan’s Return of the Member (ROM) scoring system measures credit unions’ most important asset - their members' use of the credit union. By focusing on a credit union’s services to its members instead of profitability, Return of the Member is one way that credit unions can determine if they are accomplishing their key mission.

In the 1 st quarter 2006, we made some changes to Return of the Member to better reflect the environment that credit unions were competing in. The first major change was to change the weightings on two of the three key components of Return of the Member: Return to Savers and Member Service Usage. Return of the Savers was given a higher weighting (40% versus 35% historically) because of credit unions’ growing need to grow share balances and attract deposits. While Member Service Usage is vital for credit unions to meet their members’ needs, its weighting was dropped from 30% to 25%.

In addition, a slight change was made to the lending component of Return of the Member, Return to the Borrowers. In recent years, credit unions have started to sell a significant amount of loans to the secondary market.  Some of these loans are sold but the credit union continues to service the loans. By doing this, credit unions maintain closer relationships with their members.

To make sure that this activity is reflected in the member relationship, each credit union’s mortgage servicing portfolio is added to outstanding loans when calculating the loan-to-share ratio. Previously, all secondary market sales year-to-date were included, regardless of whether the servicing was retained or released.

The following table shows the ROM Rankings for the Billion Dollar group and the changes in the rankings since the 4 th quarter 2005.

ROM Rankings for All Credit Unions over $1 Billion in Assets

Data as of March 31, 2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL

RETURN TO

RETURN TO

MEMBER

 

PREVIOUS

 

 

PERCENTILE

RAW

SAVERS

BORROWERS

SERVICE

RANK

RANK

ST

CREDIT UNION

RANKING

SCORE

SCORE

SCORE

USAGE SCORE

1

4

WA

BECU

100.00

93.15

90.99

94.59

94.59

2

3

CA

Orange County Teachers

99.10

92.25

92.79

87.39

98.20

3

1

VA

Pentagon

98.20

91.49

96.40

99.10

72.97

4

2

MA

Digital

97.30

88.47

83.78

85.59

100.00

5

8

FL

Suncoast Schools

96.40

87.84

95.50

77.48

90.09

6

6

OR

OnPoint Community

95.50

86.62

72.07

98.20

93.69

7

11

CA

San Diego County

94.59

85.36

91.89

82.88

78.38

8

10

TN

Eastman

93.69

83.96

93.69

63.96

96.40

9

12

CA

Lockheed

92.79

80.86

81.98

100.00

52.25

10

5

VA

Northwest

91.89

79.82

89.19

63.06

88.29

11

13

CA

Patelco

90.99

78.33

87.39

66.67

80.18

12

7

DC

Bank-Fund Staff

90.09

78.20

57.66

91.89

91.89

13

76

FL

Community First

89.19

77.52

88.29

72.97

66.67

14

17

CA

Redwood

88.29

76.67

76.58

95.50

50.45

15

19

NC

Allegacy

87.39

72.07

66.67

89.19

56.76

16

18

WI

Landmark

86.49

71.17

72.97

90.99

40.54

17

22

CA

Premier America

85.59

71.08

74.77

96.40

29.73

18

9

FL

GTE

84.68

70.95

43.24

92.79

84.68

19

32

UT

America First

83.78

70.05

54.95

81.98

77.48

20

15

IA

Veridian

82.88

69.95

45.95

76.58

99.10

21

16

NY

Bethpage

81.98

68.02

97.30

56.76

36.94

22

26

NY

Visions

81.08

66.35

90.09

44.14

59.46

23

23

PA

Police And Fire

80.18

65.95

99.10

28.83

64.86

24

29

CA

Pacific Service

79.28

65.50

81.08

60.36

47.75

25

27

CO

Bellco

78.38

65.36

31.53

88.29

87.39

For a full explanation of Return of the Member, click here.  One product that you can use to determine your ROM score historically and measure your ROM score versus customized peer groups is Peer-to-Peer.  Click here to request a free demo. 

 

 

 

June 12, 2006


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