NEW ORLEANS – If lending is to make any kind of comeback in the next year, credit unions will need to find a way to deal with the growing compliance burden, and do a better job of keeping the loans they already have.
CU lending execs who spoke with Credit Union Journal yesterday during the first full day of the CUNA Lending Council’s 2011 Annual Conference here lamented that dealing with compliance is stealing time from being more strategic with lending programs.
“It is taking away from our focus on lending strategies,” said Bill Vogeney. What’s making matters worse, said the SVP at Ent FCU in Colorado Springs, Colo., is the CU needs to invest more time than ever to make loans work. “Trying to find the volume, the niches . . . you can’t just use the old tactics. You have to analyze what is going on with your membership, market, and try to find pockets of business.”
Vogeney, vice chair of the CUNA Lending Council, said Ent has eight to nine lending initiatives that will take the CU into 2013, but none are home runs. “We are a $3-billion shop and I don’t think any of these ideas, on their own, will generate a huge amount of additional loans a month. But together they will bring about $10 million a month and $120 million a year. We are scratching and clawing for every loan.”
Vogeney and Aaron Bresko, VP of lending at $9.5-billion BECU in Tukwila, Wash., told Credit Union Journal that CUs need to also find the time to protect the loans they have from aggressive competitor programs. “That is huge,” said Bresko, chair of the CUNA Lending Council. “We have to get better at selling, and not just new business but retain loans before the member goes to refinance the car or home somewhere else.”
But making the time will continue to be challenging, as the new Consumer Financial Protection Bureau is expected to bring down even more restrictions and requirements, attendees agreed. Some discussed CUSO solutions and others automation. Mike James, COO of Lending Insights in Ontario, Calif., noted that credit unions have to lean on technology. “If you don’t want to hire, you have to automate and credit unions should get started now or be behind the curve, because the Consumer Financial Protection Bureau is going to bring a lot more rules down.”
