CHICAGO - Robert W. Bream is steering United Air Lines Employees' Credit Union in a whole new direction.

Since taking the $2 billion-asset credit union's controls in 1991, Mr. Bream has added such products as credit cards, checking accounts, and conforming mortgages to a traditionally plain-vanilla institution.

But Mr. Bream is wary of straying into lines of business that could crimp the customary high returns expected by members of the country's fourth-largest credit union.

"We're attempting to position our credit union to be the members' primary financial institution," said the 41-year-old chief executive of United Air Lines Employees', which is headquartered on a single floor of a lackluster office building near O'Hare International Airport.

"We are not positioning our credit union to be all things to all people. Those that do find it impossible to fulfill expectations."

In other words, don't expect United Air Lines Employees' to start offering mutual funds anytime soon. Or traveler's checks and safe deposit boxes. Or even cash at its 12 branches.

"We'd rather run a very efficient, productive organization and in return give members high rates on dividends and low loan rates," he explained.

That precedent was set by United Air Lines Employees' previous chief, Gene Artemenko. At a time when credit unions were undergoing radical changes in the kinds of services offered, Mr. Artemenko stuck with deposit accounts and loans.

By keeping things simple, the credit union held down expenses and could offer high returns to its members.

So, while Mr. Bream extended the product line, he has followed Mr. Artemenko's cost-containment credo.

In 1994 operating expenses at the credit union were 9% of total income, compared with a peer group average of 32%.

With such low costs, United Air Lines Employees' was able to return 70% of the credit union's income to members as interest on deposits, compared with 43% by credit unions in its peer group. That translates into paying 5% on regular deposit accounts.

Meeting old expectations will guide Mr. Bream as he adds products in response to new demands from members. Mr. Bream had made a name for himself in opening new lines of business and increasing automation during earlier stints at Pennsylvania State Employees Credit Union and Jax Navy Federal Credit Union.

"The fact that we are opening up the number of services will have an impact on the bottom line," Mr. Bream said. "One of the challenges in selecting any product we get into is that it has to stand on its own. We don't want to have to subsidize anything.

"We're focused in on costs and expenses," Mr. Bream said. "You will never, ever see this credit union get out of control."

John M. Tippets, chief executive of American Airlines Employees' Federal Credit Union, has embarked on a similar effort to spruce up the offerings of his $1.7 billion-asset institution. The two executives trade ideas, and Mr. Bream gets high marks from his colleague.

"All of us who come from a traditional credit union don't want to lose any of the things members enjoyed, like high savings rates and low loan rates when we offer something new," said the chief executive of the Dallas institution. "I think he's doing a good job."

The numbers appear to bear out Mr. Tippets' judgment.

The credit union introduced its first credit cards in 1992. Today, a quarter of its members - 29,000 people - carry the credit union's card.

In 1993, United Air Lines Employees' rolled out several mortgage products that conformed to secondary market standards, which was a first. Indeed, it had little choice; the only product it had offered before was a nonconforming adjustable-rate loan, and it was suffering in the refinancing boom.

The new products took off. In one year United Air Lines Employees' mortgage loan portfolio shot up 30%, to $467 million. In 1994 mortgages represented 29% of the credit union's total operating income of $108 million.

Ten weeks ago, the credit union issued its first checking accounts. No minimum balance is required, there are no annual fees, and the accounts collect 2% interest. To recoup costs, the credit union charges a fee if a member makes more than two automated teller machine withdrawals a month.

So far the credit union has raked in 9,000 accounts.

United Air Lines Employees' also has been aggressively marketing loans through cross-selling and other techniques. For instance, a force of telemarketers cold-call members to see if they need credit.

Mr. Bream said the credit union nets two or three loans for every 10 phone calls. Moreover, he said, the members haven't complained.

"When we started, we were unsure what the reaction would be," he said. "But the reaction from members has been positive. We do what you might call the soft sell."

Mr. Bream was able to start up all these new ventures even as he was building capital. The credit union's capital-to-assets ratio stood at 5.5% when he arrived; it now hovers above 9%.

Mr. Bream also ended United Air Lines Employees' distinction as being the largest privately insured credit union, changing coverage to the National Credit Union Share Insurance Fund in 1992.

The year before, private insurance became tainted because of the failure of a Rhode Island Share and Deposit Indemnity Corp., and United Air Lines Employees' was feeling some heat.

"We were the largest credit union insured by (American Share Insurance Corp.), and we were drawing the attention of different legislators (concerned about) the tall-tree theory," Mr. Bream said. "It worked to everyone's advantage to go to federal insurance, where our size was not quite as pronounced."

In another break with precedent, Mr. Bream last year opened the credit union's membership base to family members of United's employees.

Only a small number of the credit union's members are kin, but going outside its traditional base has symbolic significance for the credit union. For years the credit union has been seen solely as an employee perk.

"We are viewed as an employee benefit, and we cherish that role," Mr. Bream said.

And while some credit unions routinely add groups to their membership base, the change at United Air Line Employees' involved a great deal of soul-searching.

"We prepared a 37-page white paper - and I would say we're not a bureaucratic institution," Mr. Bream said.

Membership for family members will remain less convenient than it is for United employees. Some of the credit union's branches are located in restricted-access areas of airports.

The credit union's sponsor is undergoing changes that will affect the credit union's operations.

Last year's employee buyout of United Air Lines prevents further cutbacks at the airline, but it also cut employee salaries.

Though the buyout could slow deposit growth for a while, Mr. Bream sees it as a positive for the credit union.

"If it didn't go through, United would have been forced to take major action in furloughing positions throughout the country," he said. "The degree of furloughing necessary to restore profitability would have been very detrimental to the credit union."

In response to the salary reductions, last year the credit union offered a special low-rate-loan and debt-restructuring program.

Under the new ownership arrangement, the company shifted to a casual dress code. The mild-mannered Mr. Bream said he's more comfortable in a suit and tie, but occasionally he throws on a sweater to play along.

"I dress casually occasionally to support it," he said.

Mr. Bream said other changes are under consideration. For example, the credit union is weighing whether to add certificates of deposit to its product list.

But after four years of intense activity, United Air Lines Employees' is taking a break from changes.

"Our resources are taxed," he said. "We're doing everything we possibly can to stay ahead of the volume of inquiries from new products. We're not likely to introduce any new products soon."

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