The Federal Credit Union May-June 2014 - (Page 4)
Help Your Members by Growing Revenue
By Mike Parsons
our credit union's management
team probably has this on their
perpetual to-do list: finding
the right avenues to secure
additional income streams. You do run a
business, after all, but it is a cooperative,
member-owned business that will rise or
fall on its ability to deliver great member
service and provide a variety of financial services and products. Like any
well-situated business, a credit union
needs to draw from diverse income
sources for long-term financial stability.
These income sources come through a
variety of activities - from making loans
to members to offering various investment
programs. But the key to success is understanding your members' needs. Evaluate
their needs for financial products and services, then adapt your business operations
to accommodate them where possible.
Here are several examples:
Business Lending Programs
At First Source Federal Credit Union in
New Hartford, N.Y., we just launched our
member business lending program. It's
brand-new, but we are looking forward to
terrific results, as many local businesses are
not being served by their local banks across
the country. We expect our program will
mirror the success of similar programs at
JetStream Federal Credit Union in Miami
Lakes, Fla., and Members 1st Federal
Credit Union in Mechanicsburg, Pa.
Mike Lussier, president and CEO of
Webster First Federal Credit Union in
Worcester, Mass., is part of a title insurance
credit union service organization that
shares services with other credit unions.
Lussier's credit union also owns a property
and casualty insurance CUSO that offers
small-business insurance and workers'
compensation. He reports that the program generates an additional $100,000 to
$150,000 a year for the credit union.
Jeanne Kucey, JetStream's president and
CEO, said she started a business lending
program two years ago. JetStream FCU
Assistant Vice President of Business
Services Leo Navarro, who heads the program, assists borrowers with developing
and analyzing their business plans. "The
success of this program has no boundaries," he says. "It is growing by the day."
Bob Marquette, Members 1st's president
and CEO, is a veteran of business lending. His credit union's program is about
10 years old and started, he says, out of
a need to fill a void that banks left in the
business community. Members 1st sells
participations to other credit unions from
its program and buys from other credit
unions to keep a diverse portfolio.
Capital Communications Federal Credit
Union President and CEO Paula Stopera
says her credit union receives additional
income from its mortgage company
as well as its title insurance company.
While owning a title company may
not be an option for every credit
union, Stopera says, "You can offer
mortgages and work with other
credit unions and share in the income
from those sources."
Mid-Atlantic Federal Credit Union in
Germantown, Md., launched an investment program about a year ago. MidAtlantic FCU President and CEO Richard
Wieczorek said that although his members didn't specifically ask for a program
like this, he knew the demographics and
believed members would appreciate the
service. "By getting members to use us
for financial planning services, we expect
to increase our services per member and
ultimately attract more of their deposits,"
he says. "Members are starting to see us as
more of a full-service financial institution."
His credit union partners with a CUSO
to offer financial planning services to its
members. He encourages credit unions
to "do your due diligence on selecting
your partner/vendor. Make sure there
are no limitations to the products your
financial planner can offer."
These are just a few examples of how to
bolster your bottom lines. Look at all your
options. By teaming up with other credit
unions or CUSOs, you can help your credit
union prosper, diversify your income
streams and improve member service.
THE FEDERAL CREDIT UNION MAY-JUNE 2014
Table of Contents for the Digital Edition of The Federal Credit Union May-June 2014
Voices & Opinions
Calendar of Events
From the Chair
The Lending Landscape
The Social Life: A Social Media Roundtable
NAFCU's 2014 Annual Report
Getting to Know...
Inside NAFCU Services
From the President's Desk
The Federal Credit Union May-June 2014