Not all California credit unions are losing money. The $1.3 billion Brea-based Evangelical Christian Credit Union closed its December 2008 books with a $12 million profit, even after taking all NCUSIF-related charges, and earned another $2 million in 1st quarter 2009.
President/CEO Mark Holbrook is the first to admit he has an unusual business model, with 99% of his loans in real estate-secured member business loans. Evangelical Christian's ministry field of membership was approved upon its 1964 charter, grandfathered in when HR1151 became law.
Still, the credit union made some business decisions that are paying off today, like participating out those business loans and earning servicing income on an off-balance-sheet $2.1 billion portfolio. And, average loan to value is 58%, which has reduced losses caused by the institution's first ever foreclosures.
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"We have good fee income, good asset quality and good operational efficiency, which yields a good profit," Holbrook said.
Having a faith-based common bond is also helping Evangelical Christian gain business, contributing to a steady but manageable deposit increase.
"Talk about securing the trust of your members, we sure have it," Holbrook said.
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