CEO Unsure Why Board Denied Contract
Richard Simonton, who has served as president/CEO of AOD Federal Credit Union for nine months, told Credit Union Times he is not sure why the cooperative’s board of directors denied his request for a commitment for future employment.
Simonton was hired in December 2012 to lead the $261.9 million credit union in Bynum, Ala. He said it appears he will be leaving AOD FCU at the end of October.
“The crux of this is I came here without a contract with the intent of staying but I needed assurance that I had a job in order to move my family,” Simonton said. “After nine months, I thought I was doing pretty well, so I asked the board to provide me with a commitment for future employment and they wouldn’t provide it.”
While Simonton worked at AOD FCU in Bynum, a town roughly 60 miles east of Birmingham, Ala., his wife and family of 14 stayed behind in Florida. He said seven of his children still live at home.
The credit union’s board has not released a statement, Simonton said, but he added he was told the decision to deny his contract was not unanimous.
A comment from the AOD FCU board was not immediately available.
“As it appears today, it may or may not happen. Really, it’s still up in the air on where my future will be. There are other sources and opportunities that I am pursuing in the area,” Simonton said.
Simonton added “there are other things I can’t talk about” but in a few weeks, he said he may be freer to discuss more.
“There are things in play that could change things,” he said.
During his tenure, Simonton said AOD FCU made good progress, turning the credit union around in the area of loan growth.
According to the credit union’s NCUA financial performance report, total delinquent loans and net chargeoffs was $1.8 million in December 2012, resulting in a 1.56% loan quality index. Those numbers improved slightly $1.2 million and a 1.32% index by June 2013.
Loans totaled $114 million last December but decreased to $108 million in March 2013, only to recover to $110 million in June. That resulted in an improvement in negative loan growth from -10.61% to -6.50% during that six month period.
Despite the improvement in the loan portfolio, return on assets decreased from 0.74% in December 2012 to just 0.21% as of June 30. The loss of profits resulted from decreases in the credit union’s loan yield, investment yield and non-interest income.
Assets increased from $11.7 million in December to more than $14 million in June. The credit union’s net worth was 13.60% in December, higher than its peer average of 10.31%. However, as of June 30, AOD FCU’s net worth had decreased to 12.79%.
Prior to coming to AOD FCU, Simonton served as a conservatorship CEO at the NCUA, according to the credit union’s January 2013 member newsletter. Prior to that appointment, he served as both the CEO and chief financial officer for the $467 million Insight Credit Union in Orlando, Fla., from 1993 to 2010.
Simonton has also held positions as CFO and vice president of finance at several other credit unions and was a member of the audit committee of the former Southeast Corporate Federal Credit Union in Tallahassee, Fla. He began his career in financial services as an examiner for the NCUA.
At the time of Simonton’s announcement as the new president/CEO of AOD FCU, Board Chairman Gordon “Doc” Williamson said, “With his knowledge and over 30 years of experience in the credit union industry, as well as his dedication to member service, Rich will be a strong leader as the credit union continues to grow.”