By Ray Birch
WASHINGTON—Credit unions, like all businesses, need to be evaluating and preparing to execute their pandemic plans, according to one expert, who said the Federal Reserve’s rate cut this week is an indicator those steps should be taken now.
Several CU leaders told CUToday.info they are already thinking about expanded remote operations. One association has offered its member CUs a checklist to follow.
“Tuesday’s Fed rate cut should be a wake-up call for businesses to begin preparing coronavirus contingency plans in earnest, if they haven’t already,” said WalletHub CEO Odysseas Papadimitriou. “Companies have two major objectives in doing so: minimizing interruptions to business processes and safeguarding human capital. They go hand-in-hand, too. In particular, making adjustments to operate remotely is especially important right now.”
As of early on Feb. 5, more than 150 coronavirus cases had been confirmed across the U.S., with 11 deaths, 10 in Washington State. California Gov. Gavin Newsom and Los Angeles Mayor Eric Garcetti have declared states of emergency.
Reviewing Preparation
Remote operation is on the minds of leaders of Advia CU in Parchment, Mich. Jeff Fielder, EVP of finance, told CUToday.info the $2.1-billion credit union has taken steps to ensure its digital channels are ready to handle a much larger workload.
“If there is a spread within our communities, we would expect less branch traffic and a greater reliance on our digital and member contact center channels,” said Fielder.
Joan Opp
As many credit union leaders have stated, the uncertainty of what lies ahead from coronavirus is the most difficult issue to address.
“This is an evolving story and we are operating as normal right now,” said Fielder. “Our management team is holding table top conversations to make sure we are prepared to serve our membership and protect our team. We are also focused on being prepared to help our members through periods where their income may be reduced due to potential work closures or the inability to get to work.”
Keeping Cool
In Palo Alto, Calif., Joan Opp, CEO of the $2.8-billion Stanford FCU, stressed the importance of credit unions keeping cool heads.
“Like many others, we are evaluating our business resumption plans, but we are not panicking, as we do not have unplanned absences due to illness any different than any year during cold and flu season,” stated Opp. “We will monitor progression, if it occurs, and ensure we are equipped to do the things we need to do for our members.”
Follow the CDC
Rob Werner, CEO of the $720-million Ardent CU in Philadelphia, said the credit union is already making recommendations on how to address the coronavirus.
Rob Werner
“We’re recommending our employees and members follow the advice of the Centers for Disease Control to keep themselves safe,” said Werner.
Prepared for Work-From-Home
Chris Call, CEO of North Bay CU in Santa Rosa, Calif., in a previous report told CUToday.info the $68-million CU is remaining calm, as news stories can inflate concerns.
“We are monitoring the news reports about the virus but are not overly concerned yet about its spread here in Northern California,” Call said earlier this week. “We are prepared to have staff work from home if necessary.”
Call added North Bay is planning to turn more of its deposits into cash on hand.
“We have yet to see any member reaction specifically to virus news reports—no run on the CU yet—but we may increase our cash on hand just in case,” Call said.
‘Well-Perpared’
As far as the coronavirus impacting CU operations, CUNA Mutual Group’s chief economist Steven Rick believes the industry is ready.
“If this becomes a pandemic, I believe credit unions are very well prepared,” said Rick. “Their pandemic and disaster planning is strong. Credit unions are ready to have staff work from home to limit the exposure. They have backup computers and backup space…”
Among the associations offering guidance is the Cooperative Credit Union Association, which announced it is providing resources to help credit unions prepare for and respond to the coronavirus.
Steven Rick
“Of primary concern is the health and wellness of credit union employees and members, and the impact disruption of services may have in communities,” stated Ron McLean, CCUA president and CEO.
The league has a resource page (Coronavirus Resource Page) it said will be updated as needed. CCUA said credit union preparedness plans should include:
• A preventative program to reduce the likelihood that operations will be significantly affected by a pandemic event
• A documented strategy which provides for scaling pandemic efforts
• A comprehensive framework of facilities, systems, or procedures to continue critical operations if large number of staff are unavailable for prolonged periods
• A testing program to ensure the pandemic planning practices and capabilities are effective
• An oversight program to ensure ongoing review and updates are made to the pandemic plan