CEO of the Year Tom Gryp: Don't Be Afraid to Fail
Not fearing failure and learning from past lessons has paved the path to success for Tom Gryp, the 58-year-old president/CEO of the $471 million Notre Dame Federal Credit Union in Notre Dame, Ind.
“Let's just say I’ve been fired from a job or two,” Gryp, the winner of CU Times’ 2016 Trailblazer Award for CEO of the Year, laughed. “In today's world, I think people are too afraid to fail. And then, when they do fail, they rationalize it because they’ve been taught they’re not supposed to fail. But if you fail, you have to look at it for what it is. That can be a cathartic experience and you can come back stronger than ever.”
In September 2010, Gryp came back home to South Bend, Ind., where he was born, raised and graduated from the University of Notre Dame.
After college, he moved west to Arizona, where he worked from 1982 to 2010 as a commercial lender, a corporate development executive for an oil refinery, the founder and president of a payroll service company and the Bank of the Southwest, a Merrill Lynch business financial advisor and a managing director for the Northern Trust.
“When I tell people my career story, I feel like I’m 100 years old,” he said. “But I’ve been blessed with a career that exposed me to a lot of different things, which allowed me to fail, to rebound, to improve and to begin that whole process of growth. And when I came across the CEO position, it really gave me the opportunity to put all of those career experiences together for the good of my credit union and our community.”
Historically, Notre Dame FCU was highly involved in government guaranteed student loans, which resulted in great floating rate assets with no credit risk. However, in 2010, the federal government nationalized the guaranteed student loan business, which substantially affected the credit union's primary source of loan generation.
Though the credit union was founded in the 1940s by a couple of Notre Dame University professors and still serves the university, it has no official affiliation. The credit union leases the university's land for its headquarters location. The cooperative operates nine branches and serves more than 52,000 members.
To keep growing after the guaranteed student loan business was nationalized, Gryp knew he had to expand the diversification of the credit union's loan portfolio. He also got the idea to introduce a new initiative that would launch and drive the credit union's regional and national expansion for future growth opportunities.
In 2011, he solicited a large mortgage brokerage firm to join Notre Dame FCU, adding several well-respected local mortgage bankers to the team and increasing the cooperative's ability to offer various types of mortgage products to members.
Mortgage volume increased from $31 million in 2010 to a peak of $97 million in 2013, and the credit union ranked second in the region among all financial institutions in mortgage production.
He also initiated selling mortgages to Fannie Mae and the Federal Home Loan Bank, but protected member loyalty by retaining the mortgage servicing rights.
Under this program, mortgages originated by Notre Dame FCU but sold to third-party investors increased from $0 in December 2010 to $151 million in August 2015.
Drawing from his extensive wealth management background, Gryp converted the credit union's stock brokerage department into a private wealth management department. Private Member Group now helps members with long term financial planning and investing. PMG's assets under management grew from $37 million in December of 2010 to $108 million in August of 2015.
Under Gryp's leadership, he established Shamrock Insurance, a wholly owned CUSO of Notre Dame FCU, which offers business, life, home and auto insurance products through Insuritas, a company that helps financial institutions run their own insurance agencies.
On top of all these new ventures over the last five years, Gryp led the credit union through a painstaking core conversion, introduced mobile banking and remote deposit capture, and joined the CO-OP Shared Branching network.
These initiatives drove Notre Dame FCU's loan growth and total managed assets from $472 million in December 2010 to $729 million in August 2015, or an annual growth rate of 9.35%. However, Gryp also saw that the credit union had an another opportunity to capitalize on its widely recognized name brand – Notre Dame – to launch a national presence and future growth.
“We were operating essentially as a community bank with a geographic presence in essentially a county in Indiana, and that's it. And as a result, we were not playing into our strengths at all because the strength is our name brand and being able to do more with our alumni, who are living in all 50 states,” he explained, noting the alumni totals approximately 130,000. “Now with that said, nobody is going to come to us because of our name, but it does give us the opportunity to be heard and to make our case as to why people should consider doing business with Notre Dame Federal Credit Union.”
The cooperative reached out to Notre Dame Alumni clubs throughout the nation that support scholarships and hold a variety of events to support the underprivileged.
“They love Notre Dame and they want to help kids in their community go to Notre Dame, and they also want to help people in their community,” he said. “We participated and supported these events, which gives us an opportunity meet club members. Now, when you come back from these events, you don't have a hundred people opening up new accounts the next day, but at least they know who you are and that gives us the opportunity to win their business.”
All of these alumni groups are also closely tied to their churches and Catholic schools. That gave Notre Dame FCU another idea that led to the development of Elevate.
“Elevate is pretty simple. Once your school, parish or diocese becomes a SEG of the credit union and you take out one of the qualifying loans – auto, student, business or credit card – we will give approximately 1% in your name to the school or church,” Gryp explained. “We don't increase the rate to provide this. We take it out of our margin, or a share of the spread, and give it to the school or church. Our hope is that the word-of-mouth advertising will spread and the program will keep growing.”
Since publicly announcing Elevate in March 2015, about 60 parishes and schools from the region and nation have become SEGs. He noted churches and schools like Elevate because it doesn't compete with other fundraising efforts.
To keep promoting the credit union's national presence, Notre Dame FCU, along with five other credit unions, provided the Green Bay, Wis.-based Relevant Radio network with a $5.25 million facility. The radio network includes about 40 AM and FM stations across 17 states. Gryp said the credit unions take some of the spread from that loan and reinvest it back into the radio stations by buying ads.
“We got acquainted with multiple other credit unions that have some kind of Catholic affinity or affiliation,” he said. “It's not exact, but there are more than 90 credit unions right now that have some kind of affiliation with the Catholic community. Most of them are very, very small. But they all have a mission to help their churches and their schools. After meeting with them, it became very clear to us that there is wonderful opportunity to create some synergies by bringing all of us together to help each other and to work as a group.”
The details about how this new group, the Confederation of Catholic Oriented Credit Unions, will collaborate have not been finalized because it is in the formation stage.
“Our hope is that we’ll get many of these Catholic credit unions that want to do so much more, but are limited by size, to work as part of this larger entity so that they can provide more services through loan participations, for example, for their local communities,” Gryp said. “So we think there are some wonderful synergies that can be developed from this group.”