The Golden 1 at 80: Size and Strategy Delivers Success
Diana Dykstra still remembers her first day at The Golden 1 Credit Union. The former Bank of America employee was hired in August 1982, the very day California’s second-largest credit union reached $200 million in assets.
“I started as a part-time loan clerk,” said Dykstra, now president/CEO of the California and Nevada Credit Union Leagues. “I left in 1997 as senior vice president of lending, collections, marketing and statewide services.”
Dykstra’s career trajectory continued, including serving as president/CEO of the $850 million San Francisco Fire Credit Union, a role she occupied just prior to her league appointment. She credits her 15 years at The Golden 1 for setting her on the right path.
“I am where I am today in large part because of the opportunities (The Golden 1) gave me,” Dykstra said. “I took many things away with me and probably the most important was not to fear failure. The only way we can get better is to take measured risks, learn from the mistakes and keep moving forward.”
The Golden 1 turned 80 on Aug. 5, and its age alone may be considered an achievement given the frequencies of mergers in the industry. But as California’s second largest credit union, after the $9.8 SchoolsFirst FCU in Santa Ana, and the nation’s seventh-largest, The Golden 1 has also achieved significant growth in its size and service to members.
And, while size matters, strategy plays an even more crucial in helping the credit union fulfill its mission, according to Donna Bland, The Golden 1’s president/CEO.
“We’re here to provide our members with the products, services and advice they need to get where they want to go in life,” said Bland. “We’re advocates. We see members as the individuals they are and we’re here to help.”
The credit union backs its member commitment with a wide range of products and services, as well as an emphasis on member service itself. With more than 1,300 employees serving 640,000 members from 80 branches —more than other credit union in California—the $8.2 billion The Golden 1 has played a formidable role in its members’ financial lives, something that stands in marked contrast to its modest beginnings.
The credit union was established on Aug. 5, 1933, in the heart of the Great Depression. Chartered by 11 state employees as California State Employees Credit Union #1, the institution was the first to provide financial services to state workers and their families. By 1934, the credit union had reached 131 members and by 1950, membership topped 4,565.
Growth continued, with assets reaching the $1 million mark in 1952 and exceeding $100 million by 1977. That same year, the credit union changed its name to The Golden 1 to better reflect a quickly diversifying membership that grew well beyond its original state employee base.
By the 1980s, technology began playing a more important role in The Golden 1’s service profile, which led to the installation of ATMs.
The 1990s saw the addition of state budget payroll loans available to state employee members enrolled in direct deposit to assure that they received payment when state payrolls were delayed by specific pay dates and state budget impasses. During that same period, the credit union introduced electronic banking and bill payment services.
“With the expansion of mobile technologies in the late 2000s, we introduced dedicated mobile banking applications for Apple and Android devices, as well as Popmoney for person-to-person payments,” Bland said. “Now, almost 44% of our 640,000 members use these online and mobile services regularly.”
Such convenience has helped The Golden 1 earn significant consumer accolades. In recent years, the credit union has won the Louise Herring Credit Union Philosophy in Action award four times, the Dora Maxwell Social Responsibility Award twice, and has been named among the Sacramento Workplace Excellence Leaders twice.
“These awards are for our efforts to build financial literacy skills among the members of our communities and for providing free services such as community shred events which are attended by thousands of area residents each year,” Bland said.
The Golden 1 also introduced The Golden 1 Scholarship program, which this year provided scholarships amounting to $320,000 in renewable financial assistance to 33 students attending California colleges and universities. The credit union also just launched a Golden 1 Grant Program, which this fall will provide $300,000 to support programs in 2014 that help students develop reading skills, and provide assistance to young adults emancipated from the state’s foster care system.
It’s one thing to provide scholarships to members or advance funds to state employees whose checks have been delayed due to political wrangling, but quite something else to bail out the state itself.
The Golden 1 was one of the first financial institutions to come to the aid of the State of California when it sought to generate temporary funding to cover state operating expenses during times of budget impasse in 2008 and 2009. Through the purchase of Revenue Anticipation Notes, the credit union assisted both the state and its members who were state employees. The funds helped stabilize the government during an economically difficult time, according to Bland.
“Although Golden 1 was not the largest purchaser of California RAN offerings, our sheer size enabled us to take advantage of the offer while earning a modest return on these short term investments,” she said.
In this case, clearly, size mattered. But a strategy that helps both members and an employer the size of the State of California make its easy to understand why The Golden 1 has enjoyed the success it has over the years.
“One cannot look at Golden 1 and not admire the credit union for it’s great success,” Dykstra said. “The Golden 1 has had a huge impact in Sacramento and all communities they serve. They are great stewards in these communities and support all types of local efforts.”