Advice, Insights & Dire Predictions As TEG FCU's First President/CEO Joe Prokop Prepares To Retire

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POUGHKEEPSIE, N.Y.-Longtime TEG Federal Credit Union CEO Joseph T. Prokop has announced he will retire on Jan. 2, 2012.

TEG was founded in 1969 and Prokop, who began his career at TEG on Jan. 2, 1979 is the only President/CEO the CU has had.

During his tenure, Prokop has overseen growth from $2.9 million in assets to $172 million, as it also moved to a larger, three-county community charter. He also helped drive the growth from having just a single branch location to six. Below Mr. Prokop shares some of his insights and lessons learned from his more than 30 years in the credit union community, as well as predictions for what the future holds for CUs.

Credit Union Journal: How did you come to be involved in credit unions?
Prokop: I was a branch manager for a large bank and looking for a new opportunity. TEG had a position available and I applied. I honestly didn't really even know what a credit union was back then and it took me about six months to adjust to the difference between banks and credit unions. But, once I did adjust I loved it and I've never looked back.

CUJ: You are TEG FCU's first (and only) President. Prior to your hiring, what was the management structure?
Prokop: Prior to that they had General Managers. There were only two other employees when I began working here - a teller and a back office person. At that point and time the credit union was mostly run and staffed by board volunteers. Our assets were only $2.9 million and the volunteers used to create the statements and mail them out. They actually used to even calculate dividends and loan payments by hand with a calculator.

CUJ: During your career, you've overseen tremendous growth in assets. What are some of the keys/lessons learned in managing growth?
Prokop: Our growth over the years has been relatively steady. When we went from SEG-based to community charter is when we saw our largest increase in membership and assets and we were prepared to take on that additional membership. I think that growth has to be managed wisely and in a controlled fashion, ensuring that it benefits the credit union and enabling it to increase its income and reserves and take better care of its members.

CUJ: What have been the drivers of growth for your credit union?
Prokop: We've seen growth from many different places. When we were SEG-based our growth came from word of mouth and a very loyal membership base. When we went to a community charter, we saw a tremendous amount of growth just by opening our doors to those that were not formerly served by a credit union. In today's market, growth is a challenge, but we have developed a niche for our lending program and we're focused on growing through loans to members with colorful credit.

CUJ: What advice would you have for a new CU CEO who is just starting out?
Prokop: Really learn the business of credit unions and the credit union movement. Read the Wall Street Journal everyday so you know what's affecting our world and our economy (and you can say I saw that coming)-because it's going to affect you and your credit union. Go back and read the past minutes of your credit union so that you understand where it came from and where it is now. Acquire all the knowledge and training that you can get from within and outside your organization. But first and foremost-always remember that you work for the members' benefit and not your own!

CUJ: What is your view on the future of credit unions, if there is to be one?
Prokop: Credit unions can't operate like they did 25-30 years ago. There was never this competition amongst credit unions like there is now. You would never think about trying to steal members from another credit union when I started. But today, everything is fair game. In our market there are six different credit unions and all of us have the same community charter. In order for a credit union to survive they need to grow the membership-whether that's from banks or other credit unions. The small credit unions are going to go away as they cannot keep up with all the new regulations. And in my mind that's probably going to be the downfall of credit unions. As much as I would hate to see this happen, I predict that within 10 years credit unions will be taxed, as we now look just like a bank.

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