ROCKVILLE, Md.-National Institutes of Health FCU CEO Juli Anne Callis has resigned from the $585-million credit union and intends to leave the industry.
Callis gave her notice on June 5 and is set to leave by the end of July. She joined the credit union in 2009 from KeyPoint CU in Santa Clara, Calif., where she served as EVP and COO. After more than two decades in the CU industry, Callis told Credit Union Journal it is time for her to move on.
"I haven't decided what I'm doing with my career ... I want to pursue other options," she said, adding that being closer to family was a big part of her decision. Callis has a degree in health education and said she hoped to pursue health and health advocacy. She stressed that while she is leaving her role as CEO, she still "fully supports the CU mission in the American economy, particularly business loans for health care" and the biomedical field.
The credit union named Tim Duvall interim CEO. Duvall was executive vice president and deputy CEO and has worked for the CU for more than three decades.
"I have been acting as a change agent at this credit union," Callis said. "They went through huge changes, and they needed to. We've pulled that off and that felt good, but it's over. So the next CEO needs to come in."
Since Callis has been CEO NIHFCU has grown by $130 million in assets, has expanded to a TIP charter, and is currently "Well Capitalized" with a net worth ratio of 7.69%. Its loan portfolio is $202 million. It reported net income of more $401,000 during the first quarter of 2013, and $1.3 million for 2012. It had reported a $2.12 million loss at year-end 2008 prior to Callis' arrival.
Callis touted NIHFCU's member business lending program as an accomplishment she's particularly proud of.
"We've built the member business lending program and just got a clean bill of health from NUCA," she said. "They just need to make more money-like everybody else in the industry." NIHFCU's MBL program currently has $22.8 million on the books.
Expensive Market
Pressuring NIH FCU's bottom line, said Callis, is not only the high cost of living in the DC metro region-leading to higher employee compensation costs-but the fact it doesn't own its own headquarters. It spends more than $7 million annually to rent one floor of the HQ space, along with more than $100,000 annually in parking costs for employees. "You're carrying that, and it's long- term leases, and it's sitting there thinning out your profitability."
As she departs, Callis had plenty of recommendations for those in the CU community. "It's all about getting that overhead rate right," she said. "You've got to get the overhead down. You must. It's critical. These low margins may be with us for quite a while."
She suggested that the industry as a whole needs to see a shift to less base pay and more variable compensation. The problem, she continued, is that many CUs are dealing with staff who have been around for many years, leading to annual raises and salary creep.
She also urged credit unions to rethink the assumption that credit tiers 4-6 are exclusively low-income. The far bigger problem, she said, is low-income borrowers with good credit-members "that loaded it up in the form of heavy, heavy HELOCs, extensive credit card debt and new car financing," she said.
