At the end of "It's a Wonderful Life," we never really know if George Bailey retires from the Bailey Building and Loan in Bedford Falls or not-but I won't be retiring from North Side Community Federal Credit Union. I'm moving on to a new position as executive director at Neighborhood Housing Services of Chicago next month. After 10 years at North Side, I'd like to offer a couple of reflections on my experience.
While I never experienced an examiner throwing a dollar in the hat like at the end of the film, I have to say they have been fair and even helpful. I hear the examiner horror stories, especially from small and community development credit unions. Fortunately, I haven't seen it.
North Side experienced our "Uncle Billy lost the money" moment in 2004 and 2005 with massive charge-offs from an ill-advised indirect lending program and overreaching payday loan alternative. Our examiner was tough but fair. We were straight with her about the problems when we discovered them later than we should have. She trusted us and didn't force us into a merger. We righted the ship. Lesson: Communicate with your staff and board, partners, the NCUA and members.
Our members are our owners. This has never been more important than now. Our members can be frustrating at times. They are under enormous financial pressure and have often waited too long to come to us. We are their lifeline. Listen and treat them with respect. If the short-term answer is no, tell them and don't string them out with maybes. But tell them what they can do to get to yes and how you can get there together. Remind them their problems didn't happen overnight, and they won't be fixed overnight.
There is no better place to be in the financial world right now than at a credit union. We have what Generation Y wants-local deposits recycled into the community. The idea of a cooperative financial institution appeals to their values. That resonates in today's upside-down world of financial services.
I'm worried about the future of small credit unions. We need to scramble to keep up on the compliance side and often don't have the resources for upgrades to handle the increased compliance burden in an efficient, systematic approach with our core processor. We try to do it manually, playing catch up at the end of every week (or month, or quarter or a week before the exam-not that North Side ever did this).
We have our list of external priorities for building the credit union on our desk when we get to work in the morning and too often leave work exhausted at the end of the day with the list untouched, having dealt with internal issues. We set strategic plans with ambitious goals to expand what we're doing without new staffing and are frustrated when we wonder why we didn't make progress on them.
Whether you're large or small, the most important thing for reaching out to the community is partner, partner, partner. We could never offer a VITA site or new Americans loans or our prepaid card without our partners. Find the right partners for your credit union, and they'll be your best marketing program ever.
Thanks to all of you who have helped me over the past decade. I called you in a panic with compliance questions, technology questions, underwriting questions and just in need of a friendly voice. I called you when I didn't even know the questions I needed to be asking. Like George Bailey, I stood on the bridge over the river, and you were Clarence the angel for me. You answered my calls; the bells always rang; you've earned your wings.
Ed Jacob
Manager/CEO
North Side Community FCU
Chicago
