Singing River Will Ring In New Year At Pre-Storm Level

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Nearly five months after Hurricane Katrina, Singing River FCU is heading into the New Year in pretty good shape, especially considering all it has been through.

SRFCU is nearly finished with physical repairs and an expansion of its loan operations, and it has added new members each month through indirect auto lending.

Singing River President James B. Smith said he wasn't overly concerned with the recent passing of the 90-day mark for loan payment extensions that many financial institutions had granted Katrina victims. Smith said Singing River FCU had issued 60-day extensions, and has successfully made it past that deadline without any excessive loan failures, meaning the New Year isn't shaping up to be a traumatic event for the bottom line.

"January 15 is not going to be a big day for us," Smith said, referring to the date around which many of those extensions will expire.

Smith said the credit union has seen approximately one-half-million dollars in home losses, with only half being covered by insurance. Smith said he expects to write off $250,000 in home losses and start over during the New Year. The credit union expects to report an ROA of .2% in 2005, a figure it expects will grow to .5% ROA in 2006. It's loan-to-share ratio is at 70%, reflecting growth of nearly 38%.

With the recent approval of a U.S. House bill authorizing $29 billion in flood damage relief, Smith said he expects Singing River to see a huge deposit influx during 2006. He also said many Gulf State residents have quit their full-time jobs to start new businesses in tree cutting, landscaping and construction as rebuilding will continue for the next few years. Smith said Singing River has been considering launching its own member business lending program and might be up and running with it by the second quarter of 2006.

"We have a tremendous need in our area for small business loans," he said. "These people need some seed money to get started."

Smith said Singing River FCU has seen extraordinary growth in its indirect auto loan portfolio, but he expects that volume to slow down and be replaced by home loans in 2006 as more insurance checks and grant money are sent to members. Smith said Singing River normally has around 150 new members sign up each month, but the high number of indirect auto loans has pushed that number up to 350.

"We're seeing a substantial member increase," Smith said. "We're doubling our new members per month."

Katrina sent floodwaters into Singing River's main office and rose to four feet inside the lobby. Smith said the drywall has been replaced, the carpet is being laid down, and new furniture will be delivered the second week in January when Singing River will be functioning at its pre-hurricane level.

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