By Ray Birch
WARNER ROBBINS, Ga.—It is as much a David and Goliath battle among financial providers as ever, but it’s a fight that small CUs can win if they have the right sling and stones, according to one small credit union.
Robby Glore, CEO of the $13.6-million Combined Employees CU, described for CUToday.info how his organization has been able to complete a 180-degree turnaround—based largely on jump-starting a stale lending program—outlining steps other small CUs could follow.
“I am the CEO of a ‘David’ credit union in a sea of Goliaths,” said Glore, who acknowledged the turnaround at his shop has taken a few years—and not a single battle—to arrive. “I have been the CEO here since late 2016 and my team has worked hard to turn our credit union away from the brink of extinction—literally. And we have finally done so and are marching to the beat of a different drummer now.”
What Glore said he and his seven-person staff have worked hard to do has been to revive a lending program that had been rife with stale, outdated processes that were hurting the credit union’s future.
When Glore took the job he was aware CECU had its challenges.
“I knew there were some serious problems here, but they turned out to be a lot worse than I anticipated,” said Glore. “Our biggest problem was that we drive a lot of our income from loans and we were virtually not making any loans. I was handed a $44,000 loss in 2016. We had to address lending immediately.”
The first step Glore took was to rewrite all the loan policies and underwriting guidelines, putting in a structure that allowed the credit union to dig deeper into credit tiers. He noted the CU had very loose lending policies in place prior to his arrival.
New Skills
The credit union also brought in some new loan officers.
“These employees had the skill we needed to put more loans—and good quality loans—on the books. And, we retrained the lending staff we already had,” said Glore. “We began putting on good quality loans, and that meant reaching down to lower credit tiers and mitigating that risk. It took us about 18 months before the lending situation finally turned around here.”
Meanwhile, to drive additional income, Glore bought some loan participations.
“The participations put a Band-Aid on the situation,” he said. “I bought about a million-and-a-half dollars of participation loans the first year, which gave us a bit of a break-even year in 2017. Then, in the middle of 2018, in June, everything began to click for us.”
Combined ECU finished 2018 with a 7% increase in lending.
New Marketing Efforts
It would take time before the credit union had a profitable year, working back from losses of $104,000 in 2017, $124,000 in 2018, $57,000 the following year, and $5,000 in 2020. Combined ECU reported $53,296 in net income in 2021, according to Call Report data. ROA turned positive in 2021, at .42%.
In addition to having an improved lending team, what has also helped to turn the tide in David’s favor has been marketing promotions and just strong word-of-mouth advertising, according to Glore.
The advertising began with the rollout by Combined ECU of a “Wanted” campaign in which it made clear to the community it was back in the business of lending. The offer was made sweeter not just by competitive rates, but by rewarding members $100 for any refinance they brought to the CU worth over $12,000. The credit union also began giving members $50 for loan referrals.
“For some, that was like getting $150 off the price your car loan, cash back in your hand,” said Glore.
Back on the Map
What all of this really did for Combined ECU, explained Glore, was put it back on the map in Warner Robbins, which is about 100 miles southeast of Atlanta, and get people to talk about the cooperative.
“We are a SEG-based credit union and our members began talking a lot about us on their jobs and within the community,” said Glore. “Our membership growth improved and we were getting a lot of referral business.”
The credit union also invested in social media advertising, including a Facebook page.
Combined ECU, however, still does not offer checking, but Glore said it has addressed that product void with a new reloadable debit card.
“We had to find a way to serve people who needed a checking account,” he said. “I applied for a $10,000 COVID emergency grant from NCUA in 2020. When I got the funds we loaded $50 on 180 cards and I gave those to the members. Those cards have a mobile app with them, and this acts as a check register. It shows people how much money they have left on the card.”
‘Making Ourselves Known’
Glore said the promotion was not just a nice giveback for its approximately 3,200 members, it promoted the CU’s mobile app, and further improved the organization’s awareness and perception that the small organization has the products to meet the community’s needs. The CU also received a state-level Louise Herring Award for the debit card giveback.
“Make no mistake, I’m still fighting with Goliath, but we are making ourselves known in our community,” said Glore.