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SALT LAKE CITY – Succession planning, long a persistent problem at small credit unions across the U.S., became a topic for media coverage in Utah this month following complaints that a $10 million Salt Lake CU erred in hiring a CEO lacking bank or CU experience. The Newspaper Employees CU, whose members include employees at the Salt Lake Tribune, the state’s largest paper, insisted it did nothing wrong in hiring Pam Wagstaff, a retail credit coordinator for Newspaper Agency Corp. to replace the retiring NECU President Pat Marcusen.”We received close to a dozen applications of people who were qualified and Pam who has had supervisory experience was in the top four,” explained Arlen Peacock, chairman of NECU. Peacock said Wagstaff, who was to start work Oct. 15, will receive training under Marcusen, who was quoted in Tribune articles saying that the CU did have more qualified applicants, but that they demanded annual salaries of as much as $80,000 or $90,000. “That’s ridiculous given the size of our credit union,” she said, noting the CEO position pays about $40,000 depending on experience In her position at the Newspaper Agency Corp., Wagstaff was responsible for collecting on past-due ads and assessing the credit worthiness of potential newspaper advertisers. She has had some supervisory experience but not in her current position at NAC, and she has never worked at a credit union or bank. Peacock said he was not sure who brought the complaint about the pay issue to the Tribune “but I was a little surprised to read about it in this morning’s paper.” adding the matter “was rather upsetting.” Of the four finalists for the job, Peacock said two were from other CUs and one was in house, but the group “had asked for considerable amount of money more than we could afford,” he said. Orla Beth Peck, the chief supervisor in the Department of Financial Institutions, said small CUs do have a problem finding CEO talent considering high salaries. “Small credit unions have difficulty finding employees who match exactly the needed qualifications and so small credit unions do need the help,” said Peck whose boss, Ed Leary, director, was quoted as stating that the complaints from some Tribune employees about Wagstaff illustrate “an ongoing frustration” the agency has with CUs that cannot afford to pay the most skilled and experienced executives. He said less experienced executives often work out just fine, but inexperienced CEOs sometimes have been responsible for problems such as declining loan quality, plummeting employee morale and even a lack of oversight that can lead to fraud Peacock said he is well satisfied with the Wagstaff choice adding the CU, with 1,700 members, has been performing well with a 17-18% capital asset ratio and a delinquency ratio of 1.4%. But Peck intends to keep an eye on Newspaper Employees CU and said the state has agreed to monitor the situation rather than take any immediate steps since Marcusen has agreed to stay on at the CU until she determines Wagstaff is thoroughly trained. In addition, an experienced NECU loan officer who contemplated leaving the CU has also committed to remain at the CU indefinitely until the successful transition. -

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