BI Teams, Growth, And Payday Alternatives

Five can't-miss data points this week on CreditUnions.com.

 
 

This week, CreditUnions.com shows how one Vermont credit union launched a business intelligence department, one Michigan credit union plans to more than double in size over the next half-decade, and what sustainable business means for the industry.

Here are five can't-miss data points:

5 Years

Business intelligence and Nick Gallerani have grown up together at Vermont Federal Credit Union. Gallerani joined the credit union as a teller after graduating with a finance degree from the University of Vermont in 2014. A few weeks later, he interviewed with chief financial officer Jean Giard to become the credit union’s first data analyst, a role he has subsequently built up and fleshed out in the five years since.

Read: Vermont Federal Launches A Career, A Database, And A BI Department

24%

Four years ago, Arbor Financial Credit Union was a different financial institution — both by brand and by plan. Known then as Educational Community Credit Union, the cooperative had a community charter for 21 counties that allowed it to serve more than educators; however, its name created a marketing barrier that limited its growth potential. Between 2010 and 2015, the credit union increased assets 24%, compared with a statewide growth rate of 41% over the same period. After a nationwide search to replace its retiring CEO, the credit union hired Julie Blitchok in March 2015. Under her leadership, the credit union’s financials have taken off. Looking forward, the credit union is primed for even more growth.

Read: More Markets. More Members. More Growth.

4,600

NorthCountry Federal Credit Union began offering employer-sponsored small-dollar loans (ESSDLs) a dozen years ago as a way to help borrowers and their bosses alike. Today, the Vermont cooperative has more than 40 private and public employers enrolled in its ESSDL program — what NorthCountry calls income advance loans — and encourages cooperatives everywhere to consider doing the same. The idea is simple but powerful. Employers enroll in the program and then offer the loans as a benefit of employment, sometimes with loan reserves bolstered by company contributions. NorthCountry has made more than 4,600 income advance loans since 2007. The average note ranges from $1,100 to $1,200 at a maximum rate of 16.99%.

Read: A Small But Mighty Response To Payday Lenders And Fintech Competitors

Three

The word “sustainable” generates different images for different people. For some, it’s the responsible use of natural resources. For others, it’s using green building materials or perhaps employing responsible agriculture. According to the Oxford Dictionary, sustainability is the ability to maintain at a certain rate or level. What does that mean for credit unions? Can credit union professionals employ a sustainable mindset to work smarter and drive better outcomes for all stakeholders? For businesses, sustainable strategy requires organizations to be purpose-driven, values-based, and cooperative. The credit union movement leverages all three of these; however, this doesn’t mean every credit union is automatically fully leveraging sustainable business practices today. It does mean credit unions are on the right road, and perhaps, with an enhanced roadmap, can reach an even better destination tomorrow.

Read: What Does “Sustainable Business” Mean To Credit Unions?

11 Basis Points

Callahan & Associates hosted its quarterly Trendwatch webinar on Thursday, providing an overview of second quarter credit union trends. Of note, the industry continues to grow both sides of the balance sheet, yielding positive performance metrics and revealing areas of opportunity. As they do every quarter, Callahan's analysts find three takeaways from the data. Of note this quarter? The industry's net interest margin is up 11 basis points year-over-year, to 3.18%. With that spike, credit unions are now earning more on their interest margin than they are paying in expenses for the first time since 2011.

Read: 3 Takeaways From Trendwatch 2Q 2019

Happy Reading!

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Aug. 19, 2019


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