MERIDIAN, Miss. -
Although the $39.8-million CU already was on the road to recovery when Besecke arrived in 2003, it had weathered some tough times, mostly due to internal rather than external challenges.
"In the late 1990s, this credit union experienced some management problems," said Besecke, who spent 25 years with several Meridian, Miss., community banks before coming to the credit union. "Expenses were high and the credit union had too many staff members."
Fortunately, 1st Mississippi already had established itself as a solid real estate lender with a variety of creative loan products. The low-income designation the credit union received when it was founded in 1972 also helped distinguish it in an increasingly competitive marketplace, and together the two factors enabled the institution to survive its internal challenges prior to Besecke's arrival.
Today, Besecke and his staff of 30 still manage a large portfolio of real estate loan products that emphasize balloon features, enabling more of its membership to qualify for home ownership. The credit union operates three offices that serve some 9,000 members in Lauderdale and Clarke counties in east-central Mississippi. And Besecke, who has a marketing background, is very clear that the best way to continue serving current members is to grow the membership pool so the credit union can provide more resources, products and financial education to all.
"Most of our past roadblocks to success have been internal in nature, and we've worked hard to overcome them," said Besecke. "We've also made changes in our products and services and that's made a difference in our ability to deliver them."
With a population of about 50,000, Meridian offers 1st Mississippi great growth potential, Besecke said. The credit union, the community's largest, has always been strong in serving select employee groups, including major manufacturers like Peavey Electronics Corp. and Rush Health Systems, 1st Missisippi's single largest SEG. The credit union has adjusted its approach to market, the CEO said, by bringing more flexibility to its financial products and looking for ways to capitalize on current trends, including the sub-prime lending crisis that affected many area lenders.
"We never participated in sub-prime lending, but we're looking for ways to help borrowers who are members out of their current dilemmas," Besecke said.
The loan alternatives 1st Mississippi offers those members have become more flexible in their terms and conditions, an effort to meet a continually evolving marketplace. Rather than what Besecke calls "cut-and-dried military-style loans," the CEO has allowed credit union lending staff to offer rates and terms more suitable to individual member needs. Response to the program has been good and the loan performance better, he said.
"Over the last two years our delinquency rate was a half-point and our chargeoffs ranked in the negative numbers," Besecke said.
Despite that, Besecke feels 1st Mississippi's growth has lagged, due in part to a stagnant local economy.
The credit union is planning to become more aggressive in marketing to SEGs, something area credit unions have never really done in the past, Besecke said. In addition, the credit union's low-income designation will aid in the acquisition of grant money to help expand potential markets. That's another advantage 1st Mississippi has overlooked in the past, Besecke said.
"We've never investigated the grants available and we've never done business lending before," said the CEO. "That's going to change."
Taking a more aggressive marketing stance among Meridian financial institutions will be as new for area credit unions as it will be for 1st Mississippi and Besecke isn't sure how the market will respond. One thing the executive does know is that effective marketing will be critical to the survival of his institution and the industry.
"We have the potential to grow to $75 million to $100 million in assets over the next 10 years," said Besecke. "The only thing that will stand in our way is if we sit on our hands and do nothing. That's something no credit union can afford to do."
