RANCHO CUCAMONGA, Calif.-Expect 2013 to be another strong year of member growth, forecasts Stan Hollen, who recommends credit unions focus on ROA-driving strategies to offset all of the deposits coming in from the new sign-ups.
"We will continue to see significant savings inflow that will keep pressure on ROA," said the president of CO-OP Financial Services. "You have to have strong ROA to accommodate this type of savings growth."
Hollen cautioned against retrenching and backing away from an opportunity. "We have to take a positive attitude toward all of this. Attracting members is a positive thing and gives you the opportunity to cross sell lending."
Credit unions doing a good job cross selling members are those relying on analytics, mining existing and new member financial data, observed Hollen. Outsourcing call center duties, especially for outbound lending, is helping add more loans during non-business hours, he said.
Those efficiencies are needed to contribute to the strain on the bottom line, reminded Hollen, who emphasized the importance of mobile banking and remote deposit capture. "Last year we saw robust adoption of image-deposit-capable ATMs by credit unions, which offsets some of the bank advertising regarding their wide reach."
Debit, Credit Strategies
Hollen encouraged credit unions to keep attention on debit transaction strategies, which in 2012 grew CO-OP CUs' debit swipes by nearly 12%. Hollen again recommended using analytics to drive tactics, which could include rewards.
"I think there was a backing away last year on debit rewards due to fear of what the Durbin Amendment might do. But by and large credit unions have only had about a 7% to 9% drop in debit revenue post Durbin."
For info: CO-OP Financial Services: www.co-opfs.org.
MORE@CUJOURNAL.COM
Subscribers can read related stories by going to www.cujournal.com and typing the following headlines into the search function:
Checking Accounts Surge With Member Growth
Membership Surge Continues With 740,000 Added During Q3
Membership Soars At Record Pace
