The Steps Taken By 1 Louisiana CU To Make Its Expansion Work
When Jeff Hendrickson was hired as CEO of Dow Louisiana FCU in Plaquemine, Louisiana years ago, one of the first things he said he did was meet with the board about what was happening with the credit union's membership and the community.
Immediately noticeable was that the local chemical industry that had been such a significant employer in the greater Baton Rouge area was reducing its presence and not hiring, and its relatively closed membership was aging.
"We had to find something or some way to keep the organization going, or talk about the 'M' word," said Hendrickson, referring to a merger.
One concern he said he and the board shared was ensuring the expansion did not alienate the current FOM. To achieve that, a decision was made to focus on the communities in which its members already lived, which also allowed it to stay connected to its current sponsor company.
But in its expansion it encountered another misconception. Dow Chemical employees were relatively highly paid, and Hendrickson said that had led to a perception it was an exclusive financial institution, which presented a hurdle in serving those who didn't know much about it in the three Louisiana parishes (counties) where most of its members resided in the Baton Rouge area and to which it had expanded.
"When we announced (the expansion) it was accepted by the membership," he said. "We tried to craft it so it looked like we were doing it to help the folks who were near and dear to members' hearts."
The expansion required the credit union to examine its pricing and procedures to ensure they were sufficient to meet the new membership, and that led to ongoing monitoring of its bottom line.
Beyond that, Hendrickson said there were numerous steps it took to make the membership expansion work, including:
* Step one was attempting to convey the expansion to the community, and Hendrickson said the mass media announcements were not sufficient. What worked better, he said, was doing lots of meetings with teachers and fireman and parish employees to spread the word. That often meant meeting late at night or the early morning because of the hours worked by those people. Those meetings involved overcoming distrust of financial institutions and explaining the difference between credit unions and banks, said Hendrickson.
* The second step was to meet with employers who didn't offer credit union membership to employees. The goal wasn't to sign up SEGs, said Hendrickson; it was to make presentations to employees and recruit new members.
Other steps it took included expanding its hours to 7:30 a.m. to 7:30 p.m., and from 9-5 on Saturdays.
* Participates in community organizations, especially Chambers of Commerce, where it found many bankers were already participants. The CU's business development officer is on the chamber's welcoming committee that visits new businesses in the parish. It also hosted after-hours events for the chamber, and began participating in minority-related organizations.
* Created a "Credit Builder" seminars aimed at financial literacy. The seminars were held in local churches, hotel meeting rooms and other locations where it met with people and showed them how to improve their credit.
* Developed a program to reward members who had "colorful" credit and but had been approved for a loan. If they have improved their Beacon score within a year after being approved for the loan, the CU rewrites the loan with an improved rate reflecting the improved score.
"We partnered with other local community organizations to demonstrate DLFCU's desire to participate at all levels, including the Baton Rouge Ballet, the Baton Rouge Little Theater, and by cosponsoring CMN and the United Way," said Hendrickson. "The banks will make a little donation, but their pretty faceless. We show up."