The $172 million Mutual Savings Credit Union of Birmingham, Ala., conserved two years ago, shared its turnaround during its annual meeting.
CEO Douglas Key called the CU’s 2010 income gains an example of a "grit-your-teeth performance" after the state and the NCUA seized the CU in July 2009 following a series of commercial loans that went bad.
The CU, which lost $5.9 million in 2009, emerged from the conservatorship 10 months later. It turned a $724,000 profit last year and made $197,000 in the first quarter of 2011, said Key.
The CU also became the focus of a controversial court battle between its board and state regulators who insisted the CU had been badly mismanaged.
"We’re not out of the woods yet on some loans but I am so pleased that we have come this far," declared Key, the president of Mutual Savings brought in by former Alabama Administrator Glenn Latham.
"We’ve actually earned money in 15 out of the last 16 months and I attribute that to a cost control program, a seasoned staff doing its job and some luck considering the Alabama economy is not as bad as say Nevada or Arizona," said Key.
Mutual Savings, with 6.6% net worth, demonstrated its austerity at the annual meeting by cutting out door prizes and other frills, said Key.
Mutual Savings tightened the purse strings by cutting staff and closing two branches. Key said conditions have improved, with the remainder of 2011 looking to show income gains.