Interview with John Tippets, CEO of North Island Credit Union

John Tippets talks about the economy, California’s stinging real estate market, and the credit union’s return to its core competencies.


John Tippets became CEO of North Island Credit Union ($1.4B, San Diego, CA) in November 2009. Prior to North Island, he spent 17 years as CEO of American Airlines FCU. Tippets has served on the NAFCU Board and he was a founding Board member of the Members Development Company of the Filene National Advisory Committee. He also has served in advisory capacities to both Fannie Mae and the Federal Reserve.

How do you view the events of 2009?

JT: This is the worst economy I have ever experienced and the worst in most Americans' lives. Obviously lenders in 2005-2008 were overreaching … overreaching was happening in the corporates … and in credit unions there was some bad underwriting just to make or maintain share. All of this colors what we do going forward.

What is North Island doing?

JT: North Island has put in place a rigorous cost-cutting regimen. Our operating expenses in 2010 will be 27% below their level of 2008, and we are continuing to look for efficiencies. We are using more rigorous underwriting standards than a year or two ago. This is more so on the consumer side; our business underwriting has been holding up pretty well.

We are emphasizing a return to core competencies. For lending, we'll put more emphasis on credit, collateral, character, and capacity. We'll also go back to our core membership and do the things we do best.

How do you see your loan volume for 2010?

JT: We contracted in 2009, partly out of concerns and partly because there was not a lot of equity in this county available. We're planning to have a higher loan volume this year than last.

How has your market changed and what will you do in response?

JT: San Diego has always been good for credit unions…the events of last year increased public sentiment in our favor. In 2010 we have a plan in place to take advantage of this positive credit union environment.

How will you market North Island?

JT: We will use modestly priced, narrowly targeted marketing to get our message out. We also expect to do lots of face-to-face work. We see an opportunity with the San Diego business community. We are going to reach out more to them and to their employees.

How about community involvement?

JT: We will still be involved in the community, but…owing to the stresses of last year, we have to be more conservative. Our focus will be on our 70th Anniversary and our Navy and defense employee connections.

How will you be viewing savers?

JT: Credit unions in our region have a good reputation for safety, and until equities begin showing vigor, people are going to keep their savings here.

Have the regulator actions of 2009 affected your outlook for 2010?

JT: I believe our regulators very much want us to succeed, and they have the correct priorities, for one, reducing the costs and risks of the corporate system. I believe, like the rest of us, they have learned a lot in the past year and are coming out stronger and wiser. I see them as good partners in a difficult time and will work with them as such in 2010.

Will you try to build capital this year?

JT: Not likely. We'll have to wait a year or two. But we are poised for the future. We have the players, plan, processes, and principles in place not only to get through these difficult times but also to take advantage of the economy's upswing when it comes.

This is an excerpted interview with John Tippets. To read the full interview, check out the 4Q 2009 edition of CUSP: The Annual Report for Credit Unions. Purchase your copy today to learn the full story behind credit unions' remarkable 2009 performance. Use the Report to communicate the value of membership to your community and tout your successes to your Board.




April 5, 2010


  • THis is a great credit union! I've had my personal accounts with them for years and moved my business relationship to them a few years back from a bank. They truly understand business banking and helped correct my business plans based on their experience and it helped. It is a shame that their capital restricts them to do business lending. They bank some of the most prominent businesses in the community and now can't service them properly. Hopefulyl things will get better soon for them and all.
  • It was a great credit union before, it is completely changed now for the worse. Be carefull and pay your loan on time as they will hound and call you if you don't!
  • @ Comment #2: They are no longer a great CU because they follow up on a loan that you promised to pay back? Don't be a dead beat and take some accountability and pay your loan. I wonder how many tellers and new accounts people lost their jobs at that CU because there are so many dead beats?