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I read with great interest the letter to the editor from Dale Kerslake, President/CEO of Cascade FCU in the Dec. 14 issue titled “If Credit Unions Can’t Do It Themselves, Congress May have to Police the Industry”, and couldn’t resist weighing in. This article offends me, particularly the opening remark that “credit unions betray the trust and confidence members grant,” and I can only thank our collective lucky stars that Mr. Kerslake has not been asked to testify on our behalf. Let me state, right now, that you in no way represent this credit union! In fact Dale, it might be better for your members if you paid closer attention to your own shop and stopped worrying about others. Let’s just examine how Cascade FCU honors “the trust and confidence members grant” within your own membership. Capital seems to be Mr. Kerslake’s first point in trying to support his position and comments on a Northeast credit union with a 29% capital ratio. You might be interested to know that NCUA considers 8.0% capital as “more than sufficient.” Using this ratio, Cascade has over $4.3 million in reserves in excess of the 8.0% (going to give it back?), and Cascade’s capital has risen from 9.59% in December of 2003 to 10.60% at the end of Q3, 2005. CEO pay is also a concern of Mr. Kerslake who seems to be offended by large salaries earned by professionals delivering great returns to their members. My proof of this claim . just look at the 5300s for the two Oregon credit unions I’m sure Dale is referring to. The incredible growth in membership, size, services, and locations for both these shops is a direct reflection of the leadership these two CEOs deliver to their members, boards, and staff everyday. (Great job Cliff and Eva!!!!!) Perhaps your membership wouldn’t be shrinking at Cascade (10,796 member in 2003; 10341 members in 2005) if you applied what these two bright, innovative, and service-minded CEOs have done. Who knows, maybe your board might think that you’re this valuable too? By the way, if I get paid less than the president of the United States (which I do), can I ride on Air Force One anytime I want? Also, I must say that Dale is absolutely right . we are not solving world peace or curing cancer, at least not directly. However, aren’t many of us educating the next generation when it comes to financial responsibility? Mr. Kerslake seems to have also overlooked the real pain and suffering credit unions have alleviated throughout the country by coming, in droves, to the financial rescue of hurricane and tsunami victims. Aren’t these important attributes just as worthy as world peace or curing cancer? Don’t the scholarships many of us grant each year to a huge number of students, in some way, support an education that hopes to give the world our next world peace advocate or cancer curer? Next, Dale takes a shot at California credit unions, a marketplace I suspect he knows little or nothing about. I live and work in California and also lived and worked for much of my life in Washington, so I think I can knowingly say that neither state is similar to the other in terms of competition and cost of living. Please, don’t misunderstand me, Washington is a very competitive state and isn’t inexpensive to live in, but does not share the sheer number of financial institutions (541 credit unions in California alone vs. 139 in Washington), nor does it share the employment costs we in California bear due to high cost of living factors. As an example, in Orange County the average home price for a 1,200 square-foot home is over $630,000! Add to that a state income tax that Washington does not have and you should get the idea!! Also Dale, you shouldn’t compare national peer group information that includes compensation costs for states where the employment expense is far less than in California, or even Washington for that matter! The bottom line is that I know Mr. Kerslake to be a well-intentioned and caring CEO who is doing what he believes is the best thing for his members. In fact, there is much for Dale and Cascade to be proud of. But Dale, you should tend to your own shop and focus your “efforts” on your own credit union as it appears, just by looking at key areas of your own 5300s, that there’s plenty to keep you busy. You’ve clearly disclosed to everyone through your article that you know little on how to run a growing, progressive, innovative, and competitive credit union! Edward H. Fox President/CEO Southland Credit Union Downey, Calif.

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