SPOKANE, Wash. - Not every small credit union is looking to merge–Spokane Law Enforcement CU, in fact, is thriving thanks to the personal attention its size allows it to give to its members.
That was the message from Judy Nichols, president and CEO of the credit union, which has $34 million in assets despite having just 2,300 members.
“We have a great share of wallet,” Nichols told Credit Union Journal. “On the borrowing side, we beat competitors’ rates by 1%. Our charge-off rate is very low, which proves we don’t have to do risk-based pricing. Our average return on loans is 7%, and our net spread is over 1%.”
Numbers such as those propelled Spokane Law Enforcement to the No. 1 spot in Callahan & Associate’s Total Return of the Member category for credit unions between $20 million and $50 million in assets. SLECU did well in three performance components Callahan tracks: lending, deposits and member service usage.
Nichols said Spokane Law Enforcement CU has spent several quarters in the Callahan ratings, “so we keep an eye on those.”
“We are an occupational-based credit union that serves the law enforcement community,” which, she explained, covers a wide range of people including civilians, retired law enforcement and their families.
“We serve a niche and we want to keep that niche as long as we can. Just like every small credit union, we face competition from larger credit unions that have the funds to offer many things. We get to know our members on an individual basis so we can offer tailored products to better serve them,” Nichols said.
Nichols said SLECU decided to address a “pretty high” loan-to-share ratio by offering an IRA at 8% to attract more deposits.
“With an IRA product, we knew we would hold the money for 24 months,” she said. “Once we had it, we began planning how to keep the money after the 24-month period.”
In addition, the credit union wanted to bring in more share draft accounts, so it opened a Christmas Club account with a 12% rate. Nichols said members can transfer a maximum of $100 per month from an “active” checking account–defined as six or more transactions per month.
“Members cannot skip a couple months and catch up, so the maximum for 12 months is $1,200. We have had this product going for two or three years, and it has grown. We wanted to develop a share draft relationship so we associated it with share draft accounts. It has been a great draw for us, and it helps people save. It gives members a great rate, but we are not paying out a lot because we have limited the amount of money.”
SLECU pursues entrants at the local police academy as one method of obtaining new members, Nichols said. “We let them know who we are and what we are about, and try to get them to join.”
However, the majority of Spokane Law Enforcement’s members come from word of mouth from its membership, she continued.
“We do a lot of unusual things for our members, including a ‘Pig Out On Sinto Street’ barbecue. We do these local things to show we are down-to-earth people. This is important for a small credit union.
“We try to come up with unique programs, and I have a great staff that is really behind us and works with members well, plus a great VP who comes up with great ideas. It is all about working together and keeping our membership together.”(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
