RIVERDALE, Utah-America First Credit Union is a "strong relationship-based institution" with one of the lowest rates of single-service households and, in turn, a "very high rate of both services and accounts per member household of all participating financial institutions."
That is the assessment of Carl Campione, strategic advisor for Raddon Financial Group.
Raddon Financial Group's CEO Strategies' metrics rates $4.9-billion CU in the 94th percentile for Operational Efficiency for credit unions with $500 million or more in assets. America First was in the 92nd percentile for New Household Index, 91st for ROA, and 86th for both Cross-Sold Household Index and Checking Fees.
"AFCU does an excellent job in relationship-selling to new households in the first months of membership, and cross-sales results are consistently in the top 10% to 15% of participants," Campione said. "The Cross-Sold Household Index includes not only percent of growth, but also balances acquired and profitability, so AFCU's quality of sale is generally high."
AFCU EVP John Lund said the strength in the Operational Efficiency rating by Raddon is not a surprise because America First has a culture of service that leads to cross-sales, which in turns helps the top and the bottom lines on the balance sheet.
"Operational efficiency is one of the things we have focused on for years in trying to develop a complete and meaningful relationship with our members," he said. "We have made a significant effort to increase share of wallet, so we have good numbers on cross-selling and services per household. Those things translate to good numbers as members have car loans and credit cards, and possibly a mortgage as well. A big part of our focus has been on getting additional services."
On the expense side, Lund continued, the CU operates a high number of branches, putting pressure on expense management. The CU offers a monetary award for staff suggestions that help AFCU cut expenses. "Cost of funds is lower than it has been for some time, which also helps on the expense side," he added.
Scoring high on Raddon's Loyalty Index is something that is really important to management at America First, Lund said. RFG's Campione praised the credit union for its members being "very loyal" and professing a "high level of loan and deposit purchase intent with AFCU."
Lund explained that AFCU works "really hard to develop loyalty. We have a vice president dedicated to service, we emphasize service, we mystery shop, we monitor net promoter score and that number is part of our evaluation for branch managers. When members feel they are getting great service they are going to be more loyal to us."
Another key is moving quickly into checking accounts and debit card relationships. Campione noted AFCU is less dependent on NSF/OD fees for non-interest income than most other CUs Raddon monitors. He said America First has one of the highest rates of debit card income per checking account in the CEO Strategies program. "In addition, AFCU has a very high 64% checking penetration into member households," he said.
Lund said this is because America First considers checking one of its primary services. "If members have a checking account with us the likelihood of them using the credit union as their primary financial institution is much, much higher," he said. "We monitor that very closely and work to cross-sell checking. When a person comes in to open an account or a loan, it is part of our culture to sign them up for a checking account also."
And the debit card, which can save costs on check processing, isn't an add-on to a checking account, it's an important part of the package, he said.
