CHARLESTON, W.V.-It didn't take long for C. Dana Rawlings to identify a key problem facing Pioneer West Virginia Federal Credit Union. In fact, it led to his first executive decision when he walked through the door of the credit union on his first day as CEO in July 2010.
Clad in khakis and a brightly colored Tommy Bahama shirt, Rawlings found himself facing a roomful of dour staff dressed conservatively in suits and ties and skirts and dresses. Employee attitudes had sunk to an all-time low, Rawlings had heard, and he was beginning to understand why.
"I said, 'Guys, effective right now take off your ties and you will never wear a tie again unless you can tell me that our members are coming in wearing ties,'" said Rawlings, a Charleston native and winner of the NAFCU CEO of the Year Award for credit unions with assets less than $150 million. "Within the first 15 minutes we began changing the credit union's culture."
A 'Laughingstock'
Founded in 1940 as Kanawha County Teachers Credit Union, the institution eventually grew to serve educators in four additional counties and, in 2002, gained a community charter. In recent years, however, Pioneer had taken a downturn, making it a "laughingstock" among local credit unions, Rawlings said.
Pioneer experienced financial losses of $146,000 in 2009 and $144,000 in 2010. During that same period membership had stagnated with fewer than 800 new members joining per year in both 2009 and 2010. The credit union suffered a $4.6 million decline in gross loans outstanding during that same period and a delinquency rate of 212 basis points, astronomical for the then $123 million institution.
If all that weren't enough, Pioneer also faced five separate lawsuits from staff and members for various alleged infractions.
The members' biggest gripe? Only about 50% of all incoming calls were ever answered. Clearly a turnaround was in order (that turnaround was also highlighted during Credit Union Journal's recent Grow Show by PWVFCU's Dan McGowan.)
The Road From Houston
In 2010, Rawlings was serving as COO for Smart Financial Credit Union in Houston, Texas, when a fellow CUNA Lending Council member alerted him to the opening at Pioneer. The chance to come home and take on a troubled credit union proved to be a double incentive for Rawlings.
"I love a challenge," said Rawlings, who spent his career with financial firms like Ford Motor Credit and Compass Bank before joining Smart Financial. "I had missed the application cutoff date but convinced the board to let me interview if I traveled there at my own expense."
Travel to Charleston he did, and the board chose Rawlings over another candidate they were considering.
As new CEO, Rawlings acted quickly. He streamlined staff, hired new talent and worked to heal a corporate culture he described as "impaired." He wasted no time changing the credit union's image, launching a new branding campaign in January 2011. He drew on his lending background to create a more aggressive sales- and-service culture. Better-defined lending products with more flexible terms were introduced and a new staff incentive program helped support the sales emphasis.
Numbers Tell The Story
The turnaround was effective, with marked growth in assets to $154 million and member growth to 14,000 despite a concerted effort to reduce the number of inactive accounts. Outstanding loans jumped from $63 million when Rawlings arrived to $113 million today even as delinquencies have declined to 30 basis points. Pioneer also has expanded into four more West Virginia counties and a branch each in neighboring Kentucky and Ohio.
In 2012, Pioneer was named NAFCU's Federal Credit Union of the Year with less than $150 million in assets. But for Rawlings, the credit union's renewal efforts have only just begun.
