Alabama CUs Take Savings Gains in Stride
All that "good press" about credit unions has certainly helped fuel the big gains in savings rates among southeast CUs.
One Alabama CU is touting a 30% gain during the first two months of 2010, the League of Southeast Credit Unions reported this week.
"Our cost of funds has gone up and now we have to kind of ratchet this down a bit since we've had some very large deposit gains," commented Bob Steensma, president/CEO of the $175 million Five Star CU of Dothan, Ala. During February, Five Star gained $9 million, an unusually high figure for one month.
Overall, LSCU said the savings rate among Alabama CUs was up 12%, two times the national average. Meanwhile, Florida members' savings was 5% higher, "a100% improvement from 2008," said the league.
Apart from the favorable press and "the flight to safety" from banks, Steensma attributed the savings increases to a variety of factors including Five Star's debut of a checking reward program plus new interest on checking services.
"Our first half is normally always good for us but this year we're seeing more of it," said Steensma also citing tax benefits and the eagerness of the public "to follow New Year's resolutions" and become more frugal. However, by the end of the year the public sometimes "lets things go out the window."