HAMPDEN, Maine - The small, single-sponsor credit union advantage is a close relationship with its members. The challenge is maintaining that edge after a field of membership expansion.
But that's just what Bangor Hydro FCU has managed to do, propelling it to the No. 1 spot on Callahan & Associates' Return of the Member rankings for CUs in the $10- to $20-million category.
Darlene King, manager of the 2,100-member Bangor Hydro FCU, said their success comes from the credit union's relationship with its members.
"We were a closed membership for many years and that helped us build a strong relationship with each member," she said. "We know the people, their children, their grandchildren."
"I think we're more casual than other credit unions," King continued. "We take care of business but we have fun doing it. I think you can do that when you have a small staff."
The CU is trying to maintain that close relationship with its members even though it expanded its FOM a few years ago. About seven years ago, the credit union's primary sponsor-Bangor Hydro Electric Company-was bought by a Canadian firm, and the company downsized dramatically from 625 to 275 employees.
"Our field of membership was these employees and their families," King said. "So we did some strategic planning. We tried to open up the field of membership to businesses, but we found that to be difficult. We just didn't have the impact. So two years ago we were granted a community charter credit union by the NCUA opening our field of membership to 20 surrounding towns."
New FOM, New Building
Following this change, the credit union began looking around for its own building. "We had always leased," King said. In October 2007, the dream of owning its own building became a reality. "We now have a beautiful building," King said.
But even with a new FOM and a new building, Bangor Hydro FCU is still maintaining its close relationships with its members, by remaining small.
"We are never anticipating being the biggest, or even the middle of the pack. We're a nice solid credit union, and we want to stay that way," King said. "The move and new building cost us a lot of money. I know capital and ROA is very important. But we're not going to live by either one of them. We felt-for our future and our members' futures-we needed to do this. We had an old building, which was not conducive to getting members to come in. We didn't want to take a mortgage, so we offered some very lucrative savings' rates and we took in $1.5 million. We got several new members and had some existing members take advantage of the rates. That helped us build the facility. And now that we're here, we're getting new members all the time. We're now kind of settling our rates down, and being very competitive with others."
The CU's new location has allowed it to reach out to the community more, King said, by hosting events such as a membership barbecue. "We are about our members," she said. "And we make sure they know it. The people that work here love this work. I think it creates loyalty."
Even with its new open membership, King said the CU experiences very little delinquency.
As far as lending, King said the credit union offers very good rates and seasonal specials-such as home improvement loans in the spring, and currently home heating fuel assistance. "We try to have loan specials when it will most attract them. People are getting ready already for winter," she said. "We had a very hard winter this year, so people are getting prepared now, and oil prices are very high."
King said income has dropped due to its attractive rates. "But we feel that is really what we are in the business for-to help the members as best we can," she said. "We can do this and still maintain the quality. It takes more effort. The front staff is really good."
Perhaps the loans most popular for Bangor Hydro FCU are its second mortgage and home-equity loans. "People are using equity to pay off credit card debt, as the must wealth is still in the home," she said. "The United States has a big credit card problem."
For that reason, King said the credit doesn't simply write loans for its members. "We try to counsel them," she said. "We try to help people better utilize what they've got to work with. In fact, we've just come up with a new tagline: 'Building Strong Financial Futures...One Member At A Time.'"
One Member At A Time
"One member at a time is what we're really about," she said. "We just talk to them. Both the person that makes $30,000 and $100,000 each need to live within their means. We're trying to make lives better."
King said the CU is still writing "quite a few" mortgages. "Foreclosures are not a CU problem," she said. "We've never had a delinquent mortgage loan. We are also still writing home equity loans-they're 45% of our total loan portfolio."
The biggest challenge the $17-million Bangor Hydro FCU has at present is that even though it now offers an open membership, people don't always know that because of the CU's name. "There will probably be a name change one day," King said. "The old-timers are against the name change. I understand that because I've been here 30 years. But I think it's going to come at some point."(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/
