Unrelated Income: Time to Get Related, Says CU
RUSSELLVILLE, Ark.-Nancy Mattox believes unrelated business income is what will carry small credit unions through their current problems.
The CEO of the $7-million Priority FCU will have ROA above 1.5% at her CU next year by generating unrelated business income. "You could cut expenses, but most small credit unions don't have any more leeway in expenses," Mattox said. "You can lose assets, but you cannot lose enough assets to make a difference when you are small. Income generation is the easiest way I know to keep up with the assessments."
Mattox has PFCU offering gap insurance, guaranteed life, identity theft protection, and credit life and disability.
To help with compliance demands, Mattox recalled a service provided by the Florida league 18 years ago that helped out when she was head of Seaboard CU in Jacksonville. "The league had a compliance school at which attorneys spoke. I think that would be a great service today."
Mattox attended the league's compliance seminars and established contacts with a few attorneys whom she has called on with compliance questions. Mattox explained the attorneys helped many of the small CUs for free, since they received a sizeable amount of business from large CUs.