MONTEREY, Calif. — Three credit union representatives shared their best practices on a variety of subjects in a Big Valley session.
Many showed up to hear Diana Michaels, CEO of $31 million Western Healthcare FCU, discuss how she prices loan and deposit rates. Michaels created a pricing matrix that takes actual product performance and profitability into consideration. Her system allows the Concord-based institution to confidently set loan rates and provides managers with easy guidelines for deposit rate matching.
Michaels' loan matrix provides for the usual cost of funds and staffing expenses, as well as risk factors, but the CEO also wanted to ensure that risk-based pricing provided for consistent margins regardless of credit score and an equal contribution to the bottom line.
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