<p>AKRON, Ohio and WHITEFISH, Montana – With credit unions branching off into all product directions, from trust services to Internet access, there are still good sized credit unions that choose not to offer things as basic as credit cards and share drafts, and they say it's what their members want. "We don't have share drafts, don't have money market funds, don't have credit cards. If we can't do it better and cheaper than the banks can, then we don't do it," said Jeff Rush, president/CEO of Firestone Office FCU, Akron, Ohio. "Our goal is to return as much to the members as possible." That's the philosophy and the credit union is sticking to it. Firestone Office FCU is certainly giving back to its members. This year it is returning 14% of the interest members pay on consumer loans, and is paying a 3.75% dividend on its regular share account, way above national averages. But what about the widely-held theory that the share draft account is a loss leader needed to build a relationship with members. "We found that not to be true. We don't even have a request for checking accounts. They use area banks, but they're not getting other services from the banks," said Rush. Rush said it's all about choices, and when you present those choices to members they choose dividends over costly checking, credit cards and other services. He said other CUs would be amazed at the choices members would make if options were presented to them. "The choice is do you want us to dividend out 60% (of gross income) or more, or do you want share drafts that somebody else has to pay for," he said. Firestone Office FCU wants to give members the best rate, said Rush. So much so that if a member buys a term certificate and then later sees a better rate on a CU product because of movement in interest rates, Firestone allows the member to convert to the new product for no charge as long as they commit for longer than their original term commitment, said Rush. "It could be a week longer. We want them to have the certificate they want," he said. The $180 million credit union is lean and mean with just 12 full-time and five part-time employees. Rush said each employee of the credit union has to learn everything that it does. There are no employees who are just tellers or just loan officers. The CU pays for this expertise. No one on the 12-person staff makes less than $40,000 and senior members make up to $65,000. Rush said the CU has a lot of older members who tend to favor higher dividends since they have more money on deposit than younger members. The average member at his CU has $12,027 on deposit, compared to $6,285 for the CU's peer group. It's not that Rush and the Firestone Office FCU board never look at new products, they do. They introduced mortgages in the `90s, though the loans max out at 15-year terms, and the CU is geared more toward balloon mortgages. As early as last year it looked at offering financial planning services on site, where among other things, an advisor would help with the selection of securities. "I'm sure glad we didn't do it. The market fell out of favor. A lot of people lost money. There would have been serious repercussions," said Rush. How does he know about the repercussion part? Members have become so accustomed to the CU's above-market dividends, that when they're lowered members are calling wondering why. A 400 to 0 vote. That's how Whitefish Credit Union President/CEO Charles Abell best describes' members desire for solid dividends. "We generally have 400 people at our annual meeting. From time to time we hear, `how come we don't have checking accounts.' After a presentation from myself and the controller about having to lower dividends, than 400 to 0, they don't want share drafts," said Abell. "They can go to the bank and put $100 on deposit and get free checking, or what the banks claim is free checking." Like Firestone Office FCU, Whitefish doesn't have share drafts or credit cards. The $393 million Whitefish CU is in an interesting situation. Tucked away in the Northwest corner of Montana, the pristine land has made it a favorite vacation spot/second home for the wealthy and celebrities. But the credit union doesn't typically get those people as members, said Abell – it gets the people who work all year round and tend to be not as well off. "We have 13,000 members with less than $100 on deposit, so we're serving the underserved. We talk a lot in this country about the separation growing between rich and poor. Well we're leading the way of that divide here," said Abell. The CU is a designated low-income CU with a community charter. While it has 13,000 members with less than $100 on deposit, it also has close to 2,000 accounts with more than $40,000 on deposits and almost 400 accounts with more than $100,000. Abell said on one hand you have mills shutting down because of the federal prohibition against road building in national forests, and on the other hand there's a new subdivision going up where lots are selling for $1 million. "About the only industry left is the tourism industry, and there you have a lot of minimum wage folks," said Abell. Therefore dividends are appreciated by the CU's members, and Abell said he's not going to bring on any services that will cut into them. So is everyone else wrong, and CUs like Abell's right? "I have a lot of good friends of competing credit unions that have gone a different route. That's fine. My only philosophical problem comes when members are treated differently. If you're going to be a cooperative and take advantage of the tax exemption, then follow the rules. If I own five shares of GM, I get the same rate as someone who owns 500," said Abell. He said relationship pricing and paying better dividends to members with more on deposit is in his mind "not credit union-like." Whitefish is now the largest CU in Montana. He believes in making a profit, but an equal one. "Profitability is not a bad word. It all depends on who is getting the profit," he said. Whitefish isn't exactly plain vanilla in that it does offer member business loans. Abell, who has led the CU since 1967, said the CU has always been doing it. And as a low-income CU, it is not restricted to the 12.25% cap. He said over the years the MBLs have been for things as small as snowblowers, but it also gets into bigger ventures. For example, it has a $2.5 million MBL for a local resort up on Big Mountain. Abell doesn't consider MBLs a bank-like service, but a CU service. "If you look at the history in Europe, credit unions started lending to farmers to shoe makers. Commercial lending is not a new thing for credit unions," he said. [email protected]</p>