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The Role of the Credit Union
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Gary Fishlock is President and CEO of the STCU Credit Union in Springfield. He can be reached at 413-732-9812 or online at www.stcu.com.
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A local perspective on this industry's regional role
By Gary Fishlock
[Editor's Note: There is a struggle of sorts taking place between the banking industry and credit unions. At the beginning of March, credit union representatives went to Washington petitioning Congress to loosen the regulatory binds on credit unions. Specifically, credit unions want to swap their strict capital reserve requirements for a more flexible, risk-based standard to be determined by their regulator; raise limits on how much business lending credit unions can undertake; and allow all credit unions to add low-income communities to their membership. The following is a local perspective.]
With the ever-changing climate of the capital and credit markets, it is reassuring that financial institutions in the Pioneer Valley are conducting business as usual. The consumer is bombarded with daily news of write downs to sub-prime mortgage securities, the collapse of several hedge funds and the monoline insurers coming under extreme pressure. What is vitally important to the consumer is that the credit unions and banks are open for business to serve the deposit and credit needs for both the consumer and business client.
In 2005, STCU Credit Union changed its name from Springfield Teachers Credit Union and its charter to a community base covering all persons that live or work in the tri-county region. This move has been the primary motivation to the growth of our institution. STCU is now approaching 79 years in the Valley and continues to attract new families into the credit union while preserving our existing membership base.
Sustained Growth
In 2007, STCU Credit Union experienced an increase in its loans of 28.3 percent and deposits of 9.34 percent. We continue to encounter strong loan demand in 2008. Our delinquency levels are well below peer average and our investment portfolio remains very conservative and strong to meet future credit needs. We attribute this growth to our ability to service the credit request of the individual and small business owner in a timely and cost efficient manner through technology, product, and knowledgeable staff. The other key fundamental is the credit union's commitment to the Pioneer Valley. STCU Credit Union will continue to strive for legislative change that will promote the soundness of the industry and protect our rights as a tax exempt not-for-profit cooperative, democratically controlled for the benefit of our members.
21st Century Service
STCU Credit Union offers a variety of avenues that deliver their lending and account services over the web, through audio response units and call centers. The credit union's home banking, bill paying and lending services are secure and convenient. Remote deposit capture is scheduled to be rolled out in the summer, allowing consumer and business deposits to be completed via the web. Audio response also provides around the clock support for balance inquiries, fund transfers and rate information. Since 2005 we have operated a lending call center that operates 24/7, staffed with bi-lingual loan officers. In the past three years, we have completed more than 60 percent of our loan originations remotely from the web and/or call center.
Competition and Consolidation
The Credit Union is positioned in a marketplace with a population growth that is less than robust, yet we maintain our commitment to serve the Pioneer Valley as demonstrated over the last eight decades. There will be further consolidations in Western Massachusetts banks and credit unions over the next few years. These consolidations will occur in order to gain cost efficiencies to maintain a competitive edge and a strong market presence. These gains in cost efficiencies are vital in meeting the ever increasing delivery cost to our members, while operating in a safe and sound manner. And, in tight economic times, credit unions continue to reassure the public that credit unions place their emphasis on "people over profit."
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