Filene Planning Additional Analysis Of Growth-Drivers

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Look for more analysis of the drivers of growth at credit unions and what it means from The Filene Research Institute's

Filene's most recent study, "Asset Growth at Credit Unions: Growth in Membership Versus Assets Per Member" (The Credit Union Journal, March 8), has led the Institute to tackle other aspects of credit union membership that may prove of particular interest to lawmakers.

"If you really want to grow, you must attract new members, but that doesn't mean you shouldn't spend time trying to get a greater share of your member's wallet, and in fact, that is something we will want to revisit in providing information to members of Congress," said Bob Hoel, executive director of The Filene Research Institute. "In the past, we've always shown them information in terms of credit union members versus non-members, but the fact is, most members also do business with a bank. In fact, most upscale members are more likely to have more money at the bank than in their credit unions, even though they love their credit unions."

And that will be at the heart of the matter of another study on which Filene is currently working: why do credit union members who love their credit unions, particularly upscale members, have more of their money at their banks?

"One reason is that we don't do terribly well with the senior market, and seniors tend to be your higher-asset members," Hoel related. "Credit unions tend to build branches closer to where people work, not where they live. When a person retires, they may not be near a credit union branch anymore. Banks are very savvy at reaching out seniors. They have special packages for seniors, they offer special services, like delivering documents to seniors and appointing people to take care of seniors who are big savers. Credit unions tend to treat everyone the same. Seniors relate very strongly to service and being treated as an individual."

Hoel said his own elderly father is the perfect example. "My father loves his community bank," he noted. "There's a lady there who knows him, and she'll take care of him whenever he needs anything. The banks have made a point of having people who relate very well to seniors."

As the Baby Boomers age, serving seniors will be a huge opportunity for credit unions, Hoel said, but only if credit unions are ready to rethink how they work with their members. "Our future is departing from marketing to the average member and providing services for the average member," he advised. "We need to advertise differently to different segments, and we need to have different services for different segments."

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