David Kwant Marries Financials With Operational Finesse
Before David A. Kwant joined Mountain America Credit Union nearly 25 years ago, he was Utah’s supervisor of credit unions. So how does that experience help him as chief financial officer at the $3 billion West Jordan, Utah-based credit union?
“It helps me get into trouble,” he said with a chuckle. “I argue too much with them.” But he admitted that it is helpful to know what examiners are looking for on the financial side and making sure that the appropriate records and documentation is available.
Among large Utah-based credit unions, the 354,000-member Mountain America beat its peers last year in efficiency, loans to shares ratio, and return on assets, according to data from Callahan & Associates.
“Efficiency ratio is one to keep your eye on,” said Kwant. “It’s not the only one to watch, but it is a measure of what it’s costing you to earn a dollar. The return on assets is one of those ratios that you look at. It reflects how loaned out you are, and I think that has been one of the successes of Mountain America.”
“If we would have held the properties and waited for the market to return before aggressively selling the properties, we would have taken additional write-downs of 10% or more of the REO portfolio value,” said Paepke.
Another reason for success at Mountain America, according to Kwant, is loan portfolio diversification. “It’s like diversification in a stock portfolio. When one stock is up, another one is down, but you’re maintaining a constant return.” In addition to mortgage and auto lending and credit cards, member business loans backed by the Small Business Administration and life style lending are all part of Kwant’s recipe for portfolio diversification.