SAN DIEGO-The greater difficulty of economic forecasting has only made it more difficult to run a credit union, according to Irene Oberbauer, CEO of the $4-billion San Diego County CU, who shared these thoughts on current management challenges.
CUJ: What is it like to run a credit union in California these days?
Oberbauer: It goes without saying that running a credit union in today's economic environment is definitely challenging. For one thing, no one really knows what the Feds are going to do with their rates. Additionally, no one can even begin to try to forecast what the conditions are going to be in 2009 to develop a budget for next year.
All we can do is continue to do our best in forecasting our numbers with where we anticipate being at year-end, coupled with our collective senior management staff thoughts on target numbers for 2009.
CUJ: What direct or indirect effects is your CU feeling from the housing market?
Oberbauer: The housing marketing has been and will continue to be an area that we continue to keep a watchful eye. Fortunately, we are very well capitalized at approximately 12% and we've recognized over a $38-million net income for the first three quarters of this year.
We are at $4.3-billion in assets. Maintaining a strong, healthy number for provision for loan losses has continued to be our focus. We've evaluated all of our loans in an effort to forecast what we anticipate our loan losses to be just like all credit unions. This can only happen with our IT programming staff developing reports for us at a moment's notice so that we can continue to take a proactive approaching when evaluating our lending standards and member requests.
We are working very closely with our members on a daily basis to assist them in any way possible from a workout loan perspective. It is still too soon to determine if we've bottomed-out just yet in our market. We have a team of expert senior management staff who are on the workout loan committee evaluating the requests from our members who are experiencing hardship.
CUJ: Have the failures of IndyMac allowed you to gain members and/or deposits?
Oberbauer: With the closing of the various financial institutions we have seen our member base increase as well as deposits. We continue to be a leader in lending in San Diego since many institutions are no longer able to offer this service. We have a very loyal and dedicated staff who continue to keep member service and the credit union philosophy top of mind.
CUJ: What special promos are you running? Oberbauer: We do have marketing campaigns going on all of the time. Of particular note are our special deposit promotions offering varying rates and terms to accommodate the needs of all of our members.
We recently conducted a Member Appreciation Week campaign that offered some exciting prizes.
CUJ: What is your biggest challenge?
Oberbauer: Times are ever changing with the economy and we have to keep a vigilant, constant eye on the daily if not hourly changes and maintain an attitude that credit unions will survive the challenges.
