YORK, Penn.-One year after Bank Transfer Day, assets and loans continue to rise at First Capital FCU, and one person says he believes the consumer migration isn't over yet.
"Did we get our share? We probably got a reasonable amount of the share, but I think it could have been more," said Bill Pacacha, VP of member relations at the 19,000-member, $138-million credit union. "But people don't move those primary relationships that quick-they've got to get beat up by the banks a bit more."
Pacacha noted some big banks are planning to add $10 to $15 monthly maintenance fees in 2013 for customers who don't carry sufficiently high balances, and he predicted that that could once again play into credit unions' hands.
Nevertheless, First Capital isn't complaining. Pacacha reported that assets have risen by 10% ($12 million) year-over-year, while regular share accounts rose by 7% ($4 million). Loans grew at 10% ($7.5 million), he said, with second mortgages leading the way.
Pacacha noted that while growth was robust last fall, it slowed to normal levels during Q1 2012, with an uptick again in August and September. Growth this year has remained about 5% to 8% above what it usually is, he said. But Pacacha also noted that loan volume has not kept up with asset growth, which has caused problems with excess funds.
"We're just parking that money at our corporates and getting 15 basis points on it, which is paltry," he said.
Loyalty Program Introduced
First Capital has not yet altered its deposit rates, but it recently introduced a new loyalty rewards program designed to encourage self-service and multiple product relationships. It has also added some fees. The new program, known as "Star Rewards," is the CU's main focus heading into 2013, along with continuing to grow loans.
When Pacacha spoke to Credit Union Journal on the morning of Bank Transfer Day in 2011, he noted that First Capital was working on a debit rewards program that would pay members 10 cents per signature-based after the first 10 transactions each month. That program, known as the Advantage Card, debuted in May, and transaction volumes have risen 10% since it came onto the menu, with 80% of checking account holders signing up for it. Pacacha observed that offering may be behind some of the CU's late summer growth this year, along with lingering Bank Transfer Day sentiment.
One continuing bright spot from last November is that no measurable portion of the gains have been reversed, he said.
"We do see a few people who came over from the banks and brought some bad habits over here, and they're overdrawn or putting fraudulent checks in, and you ask them to leave," he said. "But for the most part we've not seen a lot of attrition. Once they came, they came and they're still here."
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