By Ray Birch
EAST LANSING, Mich.—In a move to streamline operations, MSU Federal Credit Union has laid off 24 members of its IT division—a 15% reduction in that area, the credit union confirmed.
The $8.3-billion CU has 121 individuals still in the technology division.
CEO April Clobes told CUToday.info the roles were eliminated due to a change in the technology team structure.
“We have a new chief technology officer, Ben Maxim,” Clobes explained. “Ben has been at the Credit Union for many years. His vision for the future of the division combined several functional areas of technology operations, product development, data analytics, innovation, and software engineering. Through the combination of these teams, we identified some duplicated roles.”
Clobes noted the reductions are not related to usage of AI.
The staff leaving the credit union have received severance payments related to years of service and job placement assistance is being provided, Clobes said.
Asked if MSU FCU will be making additional staff cuts, Clobes said the organization always evaluates staffing levels based on volume in the divisions.
"We manage changing volumes generally through attrition and shifting employees to areas of higher need. In this situation, there we not similar roles to place individuals when the existing role was no longer required," Clobes said.
Clobes emphasized that any decisions that reduce headcount are difficult and done with careful consideration.
“The technology leadership and Human Resources worked to determine the staffing levels and skills needed for our current project plans and strategic direction,” she said. “The employees were provided appropriate severance packages along with career placement service assistance.”
The credit union showed poor financial performance in 2024 and through Q1 of 2025, losing $21.3 million in net income last year and $1.5 million through March of 2025, according to Call Report data.
But Clobes said the losses had no impact on the decision to cut IT jobs.
“Losses last year were directly related to the CECL impact,” she said. “We increased our allowance significantly. In addition, in a 5.50% rising-rate environment with a sizable held mortgage portfolio, our ALM model projected losses until enough of the portfolio repriced with new loans.
“Working with our board, we decided to manage the one-year loss instead of altering our strategic growth plans,” Clobes continued. “While the 2025 first quarter call report had losses for the first quarter, those are now recovered. We have had positive earnings since April 2025 and the second quarter call report will reflect the improved financial position as planned and board approved.”