Do What You Do, And Do It Well

A lesson in (controlled) aggression positions one $42 million credit union for a substantial year of growth in 2011.


“We’re just a little 42 million dollar credit union,” says Alan Berry, CEO of Greenville Heritage Federal Credit Union (Greenville, SC), a community institution originally chartered to serve city and county municipal workers.

Despite its size, Greenville Heritage thinks big. It placed above many of its peers in annual industry performance metrics throughout 2010, and in Callahan & Associates’ 2011 Credit Union Directory the institution ranked 20th in 12-month loan growth and 54th in loan-to-share ratio. Judging by its year-end performance, 2010 was a banner year.

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player


Click here to download a PDF of the slideshow. 

“We were around 67% loan-to-share back in 2007 but have exceeded 102% as of June,” Berry says.”We understood the only way to survive a 0% rate policy is to loan it all out, every dollar you can."

To minimize drag on the negative spread of deposits, GHFCU takes a tenacious stance on asking for the business, which Berry feels is vital to its lending prowess. The credit union processes some online applications, but much of its business takes place in person. It is standard practice for front-line staff to ask about auto loans in each loan application. They determine where the member has their loan and why they haven’t moved it to GHFCU, Berry says.

“We tell borrowers ‘we don’t do indirect lending, so we know we missed you at the dealership, but we’re looking to bring you back,’” Berry says. Solid loan recapture efforts have contributed to nearly 35% annualized growth in auto loans as of 4Q 2010, according to Callahan & Associates’ FirstLook data. New and used auto lending makes up more than 62% of GHFCU’s total loan portfolio profile.

The credit union’s in-house, 15-year fixed mortgage is another major contributor to lending growth. Long-time members can take advantage of the loan’s fast-track processing and zero origination fees for properties with less than 85% loan-to-value. Products such as this have helped GHFCU grow its total real estate loans 4.85% annually as of 4Q 2010.

Of course, outstanding loan growth doesn’t occur overnight.

“It takes years to prime the pump, to make members think of you first,” Berry advises. GHFCU’s strategy is to consistently offer below-market rates to more than six tiers of borrowers, A-F quality paper.

“We’ve focused on helping members improve their cash flow,” Berry says.

Members appreciate the consideration, especially in hard economic times. It is this appreciation coupled with practical underwriting practices that has contributed to a 71.49% drop in total delinquency at GHFCU from year-end 2009 levels.

“We spent over three years just working the loan side of the balance sheet,” says Berry. “Now in 2011, it will be the savers turn.” The credit union is drafting new specials to carefully develop the balance sheet, with a targeted balance of 15% growth on both sides of the ledger.

Despite its successes in loan growth and asset quality, Greenville Heritage is not oblivious to the obstacles ahead. Profitability will remain an important consideration for small credit unions in 2011, Berry notes. And the credit union wants to keep serving its members to the best of its ability.

As of 4Q 2010, GHFCU has boosted its annualized return on average assets by 187.5%, and it has big plans for the future.

“We’re trying to break the $50 million mark in asset size next year,” Berry says. Such growth will continue a trend that included a 15.92% annual increase in asset size last year.  “Banks will be back, they’re not checked out forever, and $50 million is the level at which credit unions stop disappearing.”




Feb. 7, 2011


  • Great example of sticking to your knitting and exceeding member's expectations. No indirect lending, higher ROAA, and well-managed and poised to grow organically.
    Tom Randle