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When Eldon Arnold was first hired at Citizens Equity First Credit Union in 1965, there wasn't even a desk for him.

"I was the 37th employee," he said. "Actually, two of us came in at the same time, and there was only one desk. So I got the top drawer of a file cabinet."

At the time, the credit union was known as Caterpillar Employees and had $9 million in assets, serving construction equipment maker Caterpillar as its sole sponsor.

Forty-one years later, Arnold, now president/CEO, is leaving not only a desk but a career that allowed him to make a difference. "In a credit union, everyday you get that sense of helping others," he said. "It's that sense of accomplishment that has been so valuable to me."

With three years before official retirement age - "We would like to see the CEO retire at age 65," he said-Arnold said it just "feels right" for him to step down now. The credit union has just surpassed $3 billion in assets and serves a geographic FOM, in addition to its original sponsor.

"One of the first assignments I was given as CEO here was to come up with a succession plan," he said. "I interviewed both external and internal candidates."

Mark Spenny, who has served as EVP under Arnold, moved into the top spot on April 30 when Arnold attended his last board meeting as CEO.

"He has passion for the organization and passion for the leadership role," Arnold said of Spenny. "If we didn't have him, it would be harder for me to leave."

Walk Into The CU-And Walk Out

Looking forward to what he and his wife call "our last quarter," Arnold said his retirement years will be filled with "freedom," "adventure," "continued business efforts" and "a lot of golf." It'll start with a three-week motor home trip to Vancouver, Wash., he said.

"I like the idea of walking into the credit union and doing my transactions and letting them manage my money," he said.

Confident that CEFCU is in good hands, Arnold is leaving with some powerful parting advice and a fervor for an industry that he thinks will thrive as long as its leaders stay true to their mission-serving members.

"We have some 30 credit unions in the Peoria area, each relevant to their members in one way or another," he said. "As long as they stay relevant, they are going to do fine."

And, while he supports mergers "if there is a good fit," Arnold is adamantly opposed to credit unions that convert to banks. In fact, the mere mention triggers a sore spot.

"Nobody has more to gain from a bank conversion than I do (as CEO)," he said. "To me-I can think of no other way to say it -it's flat wrong for credit unions to convert to banks on the back of the capital that has been built by members over a number of years. The potential for personal gain by the president and board members tells me that a conversion is not in the best interest of members."

Arnold said the arguments he's heard in favor of conversions-and at least one that he chose not to hear-"just don't hold water."

When a well-known conversion specialist called to request a meeting with Arnold and his board to discuss conversion possibilities, Arnold said he politely declined. (His predecessor, John Seifken, was also solicited years earlier.)

"I told him, 'Talking with me would enlighten me about what you're doing,'" he said. "And that is of absolutely no interest to me. We understand what the issues are and what the differences are. All credit unions should know that. We do what's in the best interest of our members. We get the most out of our charter to give the most value to members. We know what a CEO could gain and what a board could gain. We know how banks operate."

That said, Arnold offered, "I'd be happy to talk to any bank that wants to convert to a credit union."

A self-described pragmatist with an aggressive edge, Arnold said he is most proud that his employees have maintained their commitment, passion and dedication to serving members.

Arnold, who also worked as an information specialist for Caterpillar, said he has always been a strong believer that the employees are the backbone of a company's success. "We know that if we don't have our employees' hearts in mind, they are not going to serve our members well," he said. "This philosophy has allowed us to grow faster than peers in our neighborhood."

In fact, Arnold attributes the CU's comfortable 10% growth each year, directly to the level of service the employees have provided its members. "We're proud of our household penetration numbers-73% in three counties."

Through his experiences both at CEFCU and Caterpillar-"A job I also loved,"-Arnold said he learned a lot about being a good manager. "First, you can't go it alone," he said. "You need to learn how to delegate."

As a young buck in the business, he said, "I liked to do things myself." It was a style that left him exhausted and offered little room for others to grow professionally. "Now, I ask myself what's the best way to delegate and give my staff room to control their own destinies. I believe it is a very strong team approach."

That doesn't mean CEFCU hasn't made a few mistakes along the way. "We've all made so many mistakes," he said.

Among them was a "relationship pricing plan" that he said was "entirely too complicated" and resulted in lost memberships. It required members to have various levels of savings and loans products and services to avoid certain fees, he said. A new plan offers free services regardless of relationship.

At one point, Arnold said, the CU also gave members a "$7-million extraordinary bonus" to make up for too much capital ratio. While the members likely didn't mind the rebate, Arnold said, "In hindsight, I wish that we had done a better job of pricing to give people our best everyday prices. Our goal should be to price as actual as we can so we don't put ourselves in that position."

The extra capital was created by a very conservative decision when "we thought interest rates were going to pop," Arnold said. "I was pleased that our board made the decision to give the money back to members."

What He'll Miss-And Won't Miss

Arnold said he will miss his "great group of employees" the most. He'll also miss being part of what he calls "unfinished business regarding the taxation issue." "In 1965, we were constantly worried about the taxation issue," he said. "While some things change, others don't. Taxation is still a key issue."

He said another key issue that will irk him until it disappears into oblivion is lenders touting 0% interest rates.

"We spend a fortune complying with Truth in Lending and have taken enough Economics 101 classes to know there is no free lunch," he said. "People think 0% interest is a good deal. It's something I feel very strongly is unfair. I know our trades (groups) have tried to fight it and (so far) can't get anybody interested in doing anything about it."

At CEFCU, Arnold said, he won't miss the stresses of "members that you are not able to recover serving, employee issues that are difficult to handle, changes in benefits programs."

Arnold said he also looks forward to never having to rummage through bills and question expenses. Part of his management style, he said, was to require "high-level" reviews to ensure the credit union was being frugal.

"Just remember that our job is to do what's in the best interest of our members," he said. "Our mission is to help improve the financial well-being our members."

How would Arnold like to be remembered?

"At the end of the day, if I'm walking down the street and a member knows me, my greatest hope is that he thinks 'That guy was involved with a really well-run organization.' With that, I will be satisfied and pleased."

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