One CU's 'Gradual' Process For Managing Ongoing Growth

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Gateway Metro Credit Union officials are proud of the CU's new ranking as Missouri's fastest growing credit union with assets of more than $50 million.

But, CEO David Barton said, the members are the ones to thank for it.

"Here's the way we look at it," he said. "We never forget that the members really do own the credit union. Our members can go anywhere they want for financial services. Everybody has car loans, CDs and IRAs."

But, even with all the competition, GMCU has continued to grow at an impressive rate of 12.57% annually. That's compared to 8.35% for all Missouri CUs combined from December 1998 to December 2003. In the first six months of 2004, assets have grown 10.62% to $153 million.

In fact, Barton said, GMCU has maintained steady, comfortable growth since he started at the CU a decade ago.

"It's been a gradual process and it has worked really well for us," Barton said. "Over the last 10 years, we've tripled in size."

In addition to the value that GMCU gives to its members in products and service, he said, the board of directors is top-notch.

"An organization might have the best products in the world, but if it doesn't have the guidance of a conscientious board and the execution of a caring talented staff, it will be mired in mediocrity," Barton said.

An example of their concern for the member, he said, is proven every time the phone rings. "On our regular member line, we have a live person answer," he said. "Unfortunately, most businesses don't do that anymore."

He said making the member the priority is stressed in every area of the CU and enforced in training sessions. Proof comes in "fan letters even to our collectors" about the friendly staff, he said.

Barton said member satisfaction surveys-and there are a lot of them-often indicate appreciation that the CU doesn't leave people in voice mail limbo. Many of those letters get displayed on the "raving fan" board on display for the members and employees.

Barton said one of its indirect auto lending partners has been so impressed with the personal phone service at Gateway that it mentions it in advertisements.

GMCU was founded in 1935 for telephone company employees and until 10 years ago, had only one office in St. Louis. The problem with that, Barton said, was that once employees retired, they closed their accounts because the credit union was no longer convenient for them.

Choosing To Expand FOM

As a result, he said board members agreed it was time to expand its field of membership, which now includes people who live and or work in two adjacent counties. To serve them, the credit union has added eight more service locations including several shared branches. A tenth "highly visible" location near a major highway is also in the works.

More growth came in 1999 when GMCU acquired a CU that served federal government employees.

Barton said the CU's indirect lending program has been a major contributor to its growth, especially this year.

"In the first eight months of this year, we are averaging $6.7 million loans each month," he said. "That's over $54 million in loans through August."

By comparison, he said, the average was about $4 million per month. "We give the dealers good member service," he said. "In 2003, we learned what they wanted and what they expected and we've done a good job to deliver."

Admittedly, Barton said, it's a struggle to pull in members who come through indirect lending.

"They don't know who we are," he said. "For all they know, GMCU is GMAC."

He said the CU has been experimenting with direct mail marketing efforts. "If they have indirect loans and live in the area, we send them 14 direct mailings and make one phone call to them in a 12 month period."

So far, he said, the CU has seen "twice as many" sign on for other services compared to prior years without the marketing. Even so, he said, numbers are still not impressive considering how low they were before this effort.

Barton said the CU prides itself on aggressive marketing campaigns-mostly produced in house by a marketing team of two full- and one part-time employee-that include lobby events and routine visits with musicians to sponsor locations. The CU also acknowledges senior citizens with special products including its popular IRAs, and an annual luncheon. The youth audiences are lured to a special "Looney Tunes" account while teenagers can get checking accounts and credit and debit cards with parental permission.

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