The David Rhamy saga at the long-ailing Silver State Schools Credit Union in Nevada ends next Monday with the CEO’s retirement and succession by the former CEO of Patelco Credit Union, Andrew Hunter.
The 61-year-old Hunter is coming out of retirement to assume the turnaround task at the privately insured $725 million Las Vegas-based Silver State. He said he was formally approached about the top job two months ago and had previously been considered by the Silver State board for a key management support job.
Though he had been doing CU consulting work in the Bay Area since leaving the San Francisco-based Patelco, Hunter confessed to “becoming restless and so this assignment looked very attractive” and challenging.
Hunter, with 30 years of experience in financial institutions including a stint at Schools First FCU in California, takes over Nevada’s largest CU at a time it is still reeling from the depressed Nevada economy, dragged down by the highest unemployment in the nation at 12.1%, high delinquencies and foreclosures.
Since Nevada’s economic spiral began in 2008, the CU under Rhamy has shrunk in asset size, closed many branches, cut salaries and drastically reduced expenses, including dropping membership this year in the California and Nevada Credit Union Leagues.
Under state regulatory pressure and operating under a consent order, the CU was forced more than a year ago to obtain a $22 million capital loan from its private insurer, American Share Insurance, with a subordinated note extended last March through 2015.
In resigning to pursue a private law practice, Rhamy, 55, who has been Silver State CEO since 1999, told The Las Vegas Review Journal he was not forced out and is satisfied that he is leaving the CU in good hands.
“Silver State Schools Credit Union has endured tough economic times, but it’s a great credit union with an active, engaged board of directors and dedicated staff,” Rhamy said.
“We regret but support and understand Dave’s decision, and appreciate his leadership over the past 12 years,” said Terry Mannion, chairman of Silver State. “Under his direction, the credit union was able to manage through one of the nation’s most challenging economic downturns.”
For Rhamy, it was the second resignation from Silver State since he quit over the New Year’s holiday in 2009 and then returned a few days later.
ASI officials in praising the management changeover have stressed that Hunter is not an “interim appointment” but is there for the long haul.
Hunter told Credit Union Times he had previously been considered as a candidate for “chief restructuring officer,” a new title formally created by the Silver State Board to assist Rhamy.
Michael Sacher, former partner-in-charge at the McGladrey Pullen accounting firm in Los Angeles, was brought in to take that title. He had replaced William Connors, a retired president/CEO of Purdue FCU of West Lafayette, Ind., who was hired in 2010 to help restore the balance sheet.
Hunter said one reason Silver State looks attractive is “my own experience working in an educational field of membership,” citing his tenure at Schools First and at other educator-based CUs prior to Patelco, where he was CEO for six years before retiring in 1999. Moreover, he added, “I do come from a family with members in the education field.”
In response to questions, Hunter said he had no intention of shifting Silver State from private to public insurance, a step taken years ago by Patelco.
The Patelco move out of ASI, he said, was the result of improved merger opportunities as an NCUA-insured CU, but at Silver State, exiting private insurance “is not part of the game plan.”
The president/CEO of ASI, Dennis Adams, voiced support for the Hunter appointment and called the CU’s turnaround record “something we are very comfortable with” considering the still negative economic conditions in Las Vegas.
“We are encouraged with the positive steps taking place” and “we expect Silver State to break even by year end,” Adams said. The CU reported a $90,000 profit in the first quarter but second-quarter results were less certain.
Asked about what he has been doing during his two retirement years, Hunter said he spent “two or three days a week” counseling the staff of the $18 million Financial Benefits CU of Alameda, Calif., on asset-liability management and assisting in other areas.
“It has been satisfying to be a volunteer to help them out,” Hunter concluded.