LAS VEGAS - The red ink has been flowing at financial institutions across the country, led by the spectacular failure of IndyMac, giving American consumers plenty to worry about. With all the talk about bank failures in the news, Credit Union Journal asked attendees at the recent National Directors' Convention here how their members are reacting, and what they are doing to allay those fears?
Gene Bopp: So far, we haven't had too many problems with that. We are a $110-million credit union, so we're doing all right. We only had one mortgage loan go bad, and it wasn't even a complete loan-it was only for about $70,000. We've been lucky.
Robert Sanchez: I've only had a couple of calls, and those were from members wondering how the IndyMac failure would affect the credit union. We had one investment with IndyMac, but it matured the week IndyMac came up in the news, so we got our money out in time. We didn't have first mortgages, so we avoided trouble. We do home equity lending.
Carlos Trevino: When members call, we mostly try to clarify the difference between credit unions and banks. We tell them we are regulated, but they are not. Banks are regulated, but not like us.
John Searson: We tell members who call to ask questions we are a credit union, not a bank, so we are a family. We have gained some people in recent weeks, especially at our new branch. People are really talking about the bank situation. We make sure our members know anything they do with us is insured.
Janet Av: We have not had any members calling us because well before the problems with IndyMac happened, we gave members with more than $100,000 in deposits excess share insurance. We tell our members how much NCUA insures, and how they get excess share insurance. We only have 2,000 members, and it is a closed membership, so they all talk to each other.
Elaine Turne: What we have seen is an increased amount in our share deposits. Our members are reacting to the news of bank failures by bringing their money to us because they feel safe. We have not had fears, because our members know the difference between a bank and a credit union.
We are a single-sponsor credit union, and people are calling us all the time wanting to put their money here, but we have to tell them "no." We try to direct them to a community credit union in the area that they can join.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/
