It's always dangerous to predict things because you can look horribly bad at year-end or you can be accused of not sounding the warning bells for things you "knew" were in the works. Well so be it, this column isn't for the meek. Here are my predictions for everything credit union in 2007:
oSomeone from the very upper echelons of the two major trade associations will not last the year in 2007, or plans for their departure will be announced in '07. Make no mistake, this is not meant with any malice. I just believe the timing may be right for a very high-level trade association executive to make their exit. Some old familiar faces will come out of nowhere as candidates for the open position.
oCredit union mergers will continue. That's no prediction, but what will shock the industry is a merger of two very large (a billion dollars or close to it) credit unions. It will change how people view CU mergers. It is no longer about large CUs saving small CUs. More large CUs will think strategically and realize even they will need the economies of scale necessary to thrive well into the future.
oThe Credit Union Regulatory Improvements Act will be introduced out West, but will fail to pass by a very slim margin.
oBanker attacks will continue to focus on large CUs, but will focus more pointedly on business lending and CRA. Bankers will call for credit unions to fall under CRA and continue to make correlations between business lending and CUs not fulfilling their congressional mandate of reaching out to the underserved. It may get sticky.
oCredit union card portfolio sales will slow. More credit unions will see the value of the card relationship and rely on their close ties with members to boost usage. The card portfolio sell-off will screech to a halt!
oA group of small to mid-sized corporate credit unions will either merge or form deep partnerships. It's been tried before to no avail, but this year will be different.
oNo stretch here, there will be more credit union conversions to banks attempted. A few will go the route of returning capital to try and boost morale, but others will continue on the path of ignorance by not communicating well with members and shunning the press. One CEO of a converting credit union will be anything but quiet. He or she will not only advocate for conversion very publicly, but will take on the trade association leaders for getting too involved in conversion rights. He or she will argue credit unions deserve the choice to convert, and will take the message to D.C. in a very public fashion. I also believe the National Center for Members Trust, now kind of a loosey goose organization designed to give support to member groups opposing conversions, will get some structure through a full-time paid employee. This group, which has raised significant money, can't afford not to with next year's action.
oThere will be consolidation in the EFT/shared branch/ATM world as credit union leaders call for more national coverage in this important aspect of member service.
oMore credit unions will enter mortgage lending. They will rely on CUSOs and larger vendors to offer a basic suite of mortgages.
oSluggish lending will plague a good part of '06 and cause credit unions to look for more streams of non-interest income.
oTrade associations will see credit unions become more selective of their relationships. A number of credit unions will go away from belonging to many associations and begin to pick and choose based on performance. The days of "we've always belonged..." are going by the wayside if CUs don't see value.
oCUNA Mutual is going to attempt to lead the way in helping credit unions add new members through a major initiative.
oCredit Union Times will continue to provide an open forum for all of the debates that will surround the above predictions and provide the most comprehensive coverage of the industry. Credit Union Times will unveil new initiatives to put the publication even closer to readers and advertisers. On that note, at press time Credit Union Times was set to host its first-ever conference in Las Vegas on complying with anti-terrorism regulations, such as the Bank Secrecy Act. More hard-hitting conferences will follow in '07.
This is the final issue of 2007, so I would like to take this opportunity to personally thank our sponsors for the BSA conference. Readers may not know, but these sponsors generously agreed to help small credit unions attend this important event by subsidizing some or all of their registration fee. I have received many thankful e-mails from anxious small CU attendees. Thanks to CUNA Mutual, PSCU Financial, CO-OP Financial Services, Credit Union Service Corporation and WesCorp. We couldn't have done it without you, and you've shown you are more than vendors--you exist to help credit unions survive and thrive. --Comments? E-mail firstname.lastname@example.org