Branching, Swiping, And Indirect Lending

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

 
 

This week, CreditUnions.com takes stock of the industry's branch footprint in 2018, finds a Florida credit union scoring swipes and savings, breaks down how the indirect lending environment is changing, and more.

Here are five can't-miss data points:

5

Given the expense of operating a physical location coupled with the growing preference of consumers to conduct routine transactions digitally and more sophisticated engagements in person, Branch operations and their relationship to the future of banking are a growing concern among financial services providers. Nationwide, the industry lost 679 brick-and-mortar branches year-over-year. In fact, the total credit union branch count increased in only five states: North Dakota, Michigan, Connecticut, Georgia and Nevada.

Read: Credit Union Branching In 2018

 

 

$5,000

A year-old debit swipe and savings plan at Community First Credit Union of Florida offers financial wellness for members and additional income for its own bottom line. The opt-in Save My Change program rounds up a member’s debit transactions to the nearest dollar and deposits that loose change into a savings account. So far, the credit union has found that members who sign up for the program increase their debit transactions per month from approximately 25 to 32, according to Rassman. That translates to roughly $2.50 more per account per month in interchange income. With 2,000 members enrolled, that’s $5,000 a month in additional income.

Read: A Strategy To Score Swipes And Savings

3,000

In October 2017, business as usual for Redwood Credit Union changed. Early that month, the Tubbs Fire — the most destructive wildfire in California history — burned nearly 37,000 acres and incinerated more than 5,700 structures, including nearly 3,000 homes in Santa Rosa and its surrounding communities. According to an estimate from Santa Rosa’s mayor, the fire caused $1.2 billion in damage and destroyed 5% of the city’s housing stock. The credit union's response to the fire was immediate and significant.

Read: Fight Fire With Funds

25%

To better focus on its strategic goal — creating "the most loyal members in the nation" — Rogue Credit Union made Laura Hansen its vice president of loyalty in 2014. In 2017, she added employee development to her portfolio. What does the work life of an executive responsible for building and sustaining the high regard of her institution's members? Well, Hansen estimates she spends at least 25% of her time developing and mentoring talent. What else does she do?

Read: What's In A Name: Vice President Of Loyalty & Employee Development

2.84%

The economics of indirect lending have changed. Four years ago, the rate on the 2 Year U.S. Treasury note was 0.48%; two years ago, it was 0.81%; today, the rate is 2.84%. Financial institutions have typically set their auto loan rates based on the 2-Year Treasury, but that hasn’t been the case in recent years, especially at credit unions. That means, overall, the margins on auto loans have shrunk. How should credit union's adjust their strategies?

Read: How Indirect Lending Is Changing

Happy Reading!

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Nov. 12, 2018


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