Sunshine State Still One of Skepticism

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ORLANDO, Fla.-With Florida seeing so much damage as a result of the housing bubble's burst, it's not surprising to hear Orlando FCU CFO Suzanne Weinstein tag her hopes for an economic recovery in the second half of 2011 to the housing market.

"The property values have really impacted our lending," said Weinstein, also a member of CUNA's CFO Council. "We're seeing a decline in unemployment here in Central Florida, but we're still at 9.9% [unemployment]; a few years ago it was close to 12%. The last couple of years have been really hard for us, and I don't see the next six months being significantly better."

That skeptical attitude comes from a struggling loan portfolio. "Demand just isn't there right now, and that's a big part of our business," she said, noting that applications just aren't coming in no matter the promotion. "Our loan-to-share ratio last year was close to 90%, and before that it was close to 100%. Right now we're in the high 70s. We've always had a high loan-to-share ratio, but there are a lot of people who-whether or not they're able to be approved for loans-they're just not borrowing."

Orlando FCU prides itself on being an auto lending shop, but right now the institution is just under 80% loaned out, said, Weinstein, compared to 18 months ago when the CU was at 102%. However, she said she expects loan-to-share to rise as the economy improves.

One policy that has come back to pay dividends for Orlando FCU is that it has always required members to come up with a 20% downpayment for mortgages, "which was very helpful for us when we had issues in Florida with property values declining." Moreover, the credit union has a policy that only 25% of its lending portfolio would be comprised of real estate, which has helped avoid losses.

Despite rough times, the components of Orlando FCU's pricing strategy haven't changed, said Weinstein, noting that the CU is "always looking at what we need to cover our expenses and operation, as well as the competition."

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