Teresa Halleck is just one year into her tenure at San Diego County Credit Union, but she’s no newcomer to the credit union community. She’s been in the industry for nearly two decades. As she approached this mile marker in her latest position, Halleck took time to reflect on what makes credit unions tick and how they can keep on ticking into the future.
Credit Union Times: What priorities had you set for your first year at San Diego County Credit Union and have you met them? What are you still working on?
Teresa Halleck: The top priorities were to work closely with the board and executive management team to identify strategic opportunities for SDCCU. We have made great progress in several strategic areas, with several technology enhancements already implemented and many more underway. During the past year, we have significantly upgraded many of our ATMs to the latest technology, we’ve implemented Live Chat and Signature Pads in our branches, added an online account opening option, upgraded our infrastructure and created an application for iPhones/iPads. We have many more technology-based strategic initiatives underway.
CU Times: Prior to SDCCU you were CEO of another large credit union, The Golden 1. What has been different? Has anything really surprised you?
Halleck: SDCCU’s brand is very strong and well established in San Diego. The strong extent to which SDCCU was already a very well established and respected brand, and an integral part of the community quickly became evident to me and more than exceeded my expectations.
CU Times: Loan growth has been a challenge for many credit unions and yours is no different. How are you dealing with that?
Halleck: Despite a sustained lackluster economy in California, SDCCU is keeping true to its philosophy of seeking good credit quality; we don’t sacrifice quality for quantity.
CU Times: San Diego County Credit Union has experienced solid membership growth, well over 4% year-to-date. What do you attribute that to?
Halleck: Our growth has been reflective of our successful efforts to offer better value to consumers in our markets, and consumer recognition that SDCCU is the best place for financial products and services. Our success in the market is reflective of the value we provide. Just this month, it was announced in San Diego that that SDCCU had once again won “Best Credit Union” for the 12th straight year in a row based on the readers’ poll conducted by the San Diego Union-Tribune. SDCCU also concurrently won Best Financial Planning, Best Home Loan Provider, and Best Place to Work, out shining many worthy competitors and employers in our market. With this being a highly competitive and oversaturated market for financial services, including a strong presence by the big banks and many large and small credit unions, and home to many other major employers, this is an impressive accomplishment.
CU Times: Occasionally we hear that the economy is improving–slowly but improving. What do you think?
Halleck: Yes, I believe the economy is slowly improving. However, I also believe it will be a slow recovery and we are likely to continue to see a few bumps in the road along the way.
CU Times: What do you see as the top three threats to the credit union industry right now?
Halleck: 1. The sustained anemic economic environment poses a threat to the long-term survival of some credit unions. The sustained economic lull is squeezing margins at the same time fee income is also greatly at risk, quality loan volume is lackluster and investment yields are low. For the credit union industry to remain profitable in the current economic environment, which appears likely to continue for several more years, credit unions in general need to improve internal efficiencies and drive their operating costs down significantly, manage resources more effectively and seek economies of scale, and closely manage their loan portfolios and cost of funds.
2. Lack of market share does not bode well for long-term survival as an industry. Overall, the industry has generally only held 6% of deposits nationally and that in and of itself is a long-term issue that has not been successfully overcome. Added onto that situation is the likely scenario of future deposit outflow back into the equities market. It was not too long ago that financial institutions were concerned about disintermediation and long-term deposit sources. The past few years have caused consumers to hold onto a lot of cash and to do so in federally-insured depository institutions. When that trend reverses the industry will once again face challenges related to retaining and attracting deposits, but this time the challenge will be compounded by lower income levels to support deposit retention.
3. Consumer expectations for financial services have evolved significantly, and continue to do so at a rapid pace. Unfortunately, many in the credit union industry are still reliant upon traditional products and services as their means of attracting and retaining member relationships. To the extent the credit union industry’s financial solution offerings do not stay relevant in the eyes of the consumer, other providers will erode the industry’s market share and some credit unions will be unable to effectively compete and survive.
CU Times: Credit unions have been more female-friendly employers than many career paths, yet according to CUNA only about a quarter of credit unions CEOs in the billion-dollar club are women. How do you feel about being one of the few and how can that figure increase?
Halleck: As fiduciaries, credit union boards of directors should always seek the best talent they can find when they fill a CEO position. As the executive management teams in our industry have become more diverse over the years, it naturally follows that this ultimately leads to more diversity in the CEO position as well over the long term. While I was appointed to a CEO role early in my career, I have never personally considered gender to be an important factor with respect to my personal success. I am confident that diversity in general at the CEO level will continue to increase as the many diverse and highly-talented executive team members in our industry continue to be recognized as our top performers and future leaders.
CU Times: You’ve spent how many years in the credit union industry? Did you plan on making a career of it? What advice do you have for young executives today who’d like to make a career of credit unions?
Halleck: I have spent approximately 18 years in the credit union industry. While I did have an interest in banking, I had no knowledge of credit unions until the time I was encouraged to apply for a credit union position.
For young executives interested in a credit union career, I would encourage them to get a very strong education in business with a master’s degree, and to make sure to include a healthy concentration of coursework in economics and accounting or finance. And, I would advise them that they need to be technologically savvy and in tune with changing consumer preferences to be and remain a strong contributor to their credit union’s short and long-term success.