Pendulik Tackles Low Demand for Loans
- In anticipation of negative loan growth, Pendulik sought additional sources of investment products during December 2009.
- He successfully managed the investment portfolio in 2010, which grew by more than $30 million, an almost 50% increase.
- 'It is amazing to look back in time three years and see that not only were Jim's predictions accurate, but more importantly, his preemptive strategies were spot on.'
Over his 37-year career in financial services, James Pendulik frequently pulls from an old sports expression: "You need to have the horses."
All newly delinquent loans were reviewed for remediation possibilities with borrowers whose circumstances allowed for consolidation and/or refinance, and contact by phone and in writing was initiated, Pendulik said. New offers were approved by him before being presented to the borrower. The swift actions proved successful. Fairfax’s delinquency ratio declined by more than 50% from 2009, charged-off loans were down nearly 40% and the credit union’s provision for loan loss expense had been reduced by almost 60%, Pendulik said. Fairfax maintained a loan loss allowance that represented nearly 400% of reportable delinquent loans and almost 2.50% of its total loan portfolio.
A typical day for Pendulik starts with tracking data and looking for patterns over time. Spotting trends helps foresee where adjustments or introductions can be made with products and services. He looks at totals on trial balances with checking, savings and certificates of deposit. There might be a preponderance of longer-term CDs, for instance. In Fairfax’s case, there is roughly $13 million in CD specials that could extend out to five years. That group is due the first quarter of 2012 with rates north of 5%, Pendulik said. He’s already thinking about coming out with a CD offering or putting a blend in the mix. In terms of cost of funds, there is some maneuvering room.
Finding the voids, making the connections and implementing the changes are all tied to a CFO’s ability to see the big picture, some would say. When asked when he started his career, Pendulik, a CPA, was somewhat startled when he realized how long ago that was–1974. His experience includes time at a New York bank and a credit union in Manhattan before coming to Fairfax in 2004. He said he considers himself fortunate that he has been exposed to virtually every area of the industry from audit and accounting to treasury, operations and lending. The only department he hasn’t worked in is information technology. Pendulik saw the fallout and took note of the lessons from the thrift and savings and loan crisis in the late 1980s.
All of those experiences have helped hone Pendulik’s ability to see into the future and yet still maintain complete control over all of the little details and nuances of everyday business, said Nicole Bowen, vice president of operations and risk management at Fairfax.