Tough Days, Tough Nights, Seeing All The Sights & Sites
Credit unions have been breathing something of a sigh of relief over the bullet that has been dodged to date with subprime mortgages. Most credit unions didn't make the "Easy to Get Into, Bear To Get Out Of" home loans, so while rising rates and payment adjustments have led some companies to shutter operations and some homeowners to sell their shutters, most CU portfolios have not felt the pain-at least directly.
But that doesn't mean there won't be some member wallets rushed into triage. Lawrence A. Aldi, VP-marketing with Academy Collection Service in Las Vegas, said he is expecting the subprime-related problems will show up with some members in other loans.
"We're worried there might be a blip in auto delinquencies," said Aldi. "We haven't seen much of it yet, but people are having to start to choose between the house and the car, the house and the car. With credit cards they know that if they don't pay it (the account) will be turned off. The (borrower) knows there is a cost associated with the car for a credit union. The cost of the repossession, the cost of taking the car to auction, if it is auctioned. People know that even if they miss a payment they can keep driving the car. They know the credit union doesn't want the car back."
* Reason No. 12,861 not to be a flight attendant: on a recent nine-hour Honolulu-Atlanta leg, the Delta flight attendants-through no fault of their own-were forced to announce that there would be no pillows or blankets available on the overnight flight.
* Speaking of Honolulu, was enjoying a warm, pleasant evening last week near the shops that feed on the tourists along the crescent of Waikiki Beach. Hanging above was a postcard of a summer moon, a breeze off the mountains, and Diamond Head standing like an ancient Hawaiian sentinel over the land and sea. In the background there was a quartet playing on one street corner. But there were no ukuleles. No guitars. No version of Don Ho's Tiny Bubbles. Instead, it was a group of Peruvian flutists accepting donations and selling their CDs from a blanket spread on the sidewalk. I've seen this same type of group, perhaps the same quartet, in New York, San Francisco and elsewhere before finding them (or maybe it was just a tribute Peruvian flutist band) in Honolulu. It all makes sense, of course. I know when I'm watching the last traces of the sun setting into the Pacific my mind naturally turns to the music of the Andes.
* In this issue the Credit Union Journal offers expanded coverage of facilities-related news. During NAFCU's recent annual meeting, Rebecca Butler of KDA Inc. shared some insightful experiences on branches, potential branch sites, and more. Among those observations:
* "You should build branch locations not according to relationships, but also according to potential relationships."
* "Using just member household locations to site a branch is not the best decision. Sheer numbers don't mean anything. You want to go after like-minded consumers, people you know you can make happy because you are making like-minded people happy."
* "Credit unions right now are going through a completely different market awareness. Credit unions have traditionally been tied to SEGs. Now credit unions are going to the suburbs. If you leave your SEG you are abandoning a core of members. The worst thing you can do is abandon a membership base."
* "Regulators will not like to hear, 'I have a gut feeling this is where we need to be.'"
* Butler said she had one credit union client show her data on member ATM transactions at proprietary machines and foreign machines. The credit union found it had 500 transactions a month at its own ATM on one side of the street, and 5,000 right across the street at a foreign machine. "You need to know traffic patterns and what's going on with (Department of Transportation). People don't like to make U-turns."
* "You may have very good visibility, but no accessibility. I can see you, I just can't get to you."
* "At some sites you can get in but you can't get out."
* "Many of you will be offered the 'perfect site for your credit union.' It may be perfect but not for you. Someone coming to you is completely different from having a plan. Know what you need before you start looking."
* Reason No. 12,862 not to be a flight attendant. On the short flight from Las Vegas to LA recently, the aircraft was configured with one seat on one side, an aisle, and two seats on the other side. Sitting in the row of single seats with a window on one side, the aisle on the other, I listened as the gentleman in front of me complained that he had asked for an aisle seat - which he had, along with a window. Not good enough. He wanted the aisle only. To make matters worse for the flight attendant, it was her first day. This is also why so many of us could never have made it as a teller.
Frank J. Diekmann can be reached at fdiekmann