COLUMBUS. Ohio-The surge in new members at credit unions is not a tide that is raising all ships, with most smaller CUs saying they are not seeing anywhere near the gains being reported by some.
In many cases, however, the limits on growth are the result of limits the credit union itself has put in place, primarily field of membership.
If the data trend line from 2011 holds true, then the 689,000 new members CUNA is projecting joined credit unions during the first two months of 2012 will have done so primarily at large credit unions.
Consensus among a number of Ohio CU leaders is that membership growth at their small credit unions may have picked up a bit as a result of awareness in the wake of Bank Transfer Day, but there really hasn't been a great deal of change during the last five months. Credit Union Journal spoke with several credit union execs during the Ohio CU League's annual meeting here.
Becky Geissinger, CEO of the $7-million Canton Police Firemen's CU, summed up the situation by observing that Bank Transfer Day was, and continues to be, "no big event. It may not have been as good for our credit union because we are not community chartered."
Jesi Henricks, marketing director at the $31-million Smart FCU in Columbus, said her credit union tried to get things moving on Bank Transfer Day by opening on Saturday for the first time. "We saw a very small spike in membership, but then it's just been business as usual-no real significant difference."
Closed Fields, Closed Doors
Similarly, Julie Bruzina, CEO at the $7-million St. James Parish CU in Cincinnati, said Bank Transfer Day "really did not even happen for us. We are very small with a closed field of membership."
Roger Packman, CEO at the $3.2-million Marysville Goodyear Employees FCU in Marysville, which serves 300 workers at the local Goodyear plant, agreed that a closed field of membership does not help a credit union capitalize on the rush to join credit unions. "All this Bank Transfer Day momentum, all the new members credit unions are getting, we are just not seeing any kind of difference in our growth."
Derek Sidor, CEO at the $46-million Tiffin St. Joseph FCU in Tiffin, Ohio, said, "We saw a slight uptick around November 5 (2011), but it's been status quo after that."
The Ohio league's Manager of Risk Management, Valarie Edgington, who works closely with small CUs, said from her interactions with CUs she has seen directly that small CUs are not pulling in new members at the rate the larger ones are. She attributes much of that to limitations around location and field of membership, as well as lack of action by some small CUs.
"Look at the makeup of small credit unions; many are located inside a building they are sharing with another business, so they do not have the street presence and people don't know they can go to them," said Edgington. "The smaller ones are likely serving a single SEG or have a very closed membership group."
Those small credit unions that Edgington has seen do well with membership growth late last year and into 2012 have very "proactive CEOs. They also have a proactive board. You have to get out into the community and collaborate, not just with your members and the community, but with other credit unions as well. You need to look at what those credit unions are doing right now to drive membership growth and emulate that."
Every small CU has a niche, reminded Edgington, and she said to improve membership they have to take steps to ensure they "become the best at what they do inside that niche. In every neighborhood you have a Walmart, but you also have the mom and pop stores people need to use and are the fabric of the community."
What's In A Name? Problems
Canton Police's Geissinger feels that the names of many small credit unions are a big reason why numerous small CUs are missing out on the membership boon. She pointed out that CPFCU serves SEGs outside those noted in her credit union's name. "Everyone knows the issue, people don't realize they can join."
Smart FCU's Henricks asserted that the lack of membership growth at small CUs can be attributed to consumers perceiving small credit unions as having far fewer services than banks. "I think that's why they are passing us up now."
But one small credit union, the $23-million community-chartered Dynamic FCU in Celina, Ohio, reports excellent membership growth at the end of last year and during the first quarter of 2012 as the result of steps it has taken to attract members, according to CEO Diane Rodriguez (see related story, below).
