…to help all of Delaware’s
credit unions exist, compete, and prosper
WINTER, 2003
PLAN AHEAD FOR THE NEW YEAR
Now that the New Year is upon us, it’s a
perfect time to organize our thoughts and plan our business strategies for the
coming year. Planning allows us to
prioritize our key issues, identify our strengths and weaknesses, and develop
long-term goals that will insure the future stability and success of our
organizations. It is extremely
important for credit unions to plan considering today’s economic environment. With increased competition for consumers’ financial
services, credit unions, especially smaller credit unions, need to be prepared
for the threats and challenges that lay ahead.
The process of strategic
planning takes an organization where it wants to go in the next several years. The strategic plan forms the basis of such annual plans as: the Business
Plan, the Marketing Plan, the Asset/Liability Plan and the Budget.
How does a credit union plan? The first step is to schedule a time when directors and management can
meet uninterrupted and work through the planning process. The planning process is most effective when conducted by a professional
planning facilitator, preferably one familiar with the credit union movement. This facilitator will guide the planning process to address your specific
credit union issues, such as how to improve your bottom line, what new services
to offer, how to increase membership, loans, capital, etc., how to balance ALM
with quality to satisfy NCUA, and what to do if management leaves (see page 4
for more information on succession planning). The facilitator will offer solutions to your issues and suggest steps to
take to achieve your goals.
For more information on strategic planning or finding
a planning facilitator, contact your League.
Mid-Atlantic Corporate FCU
Launches New Website
After nearly a year of development, Mid-Atlantic
Corporate Federal Credit Union unveiled its revamped website in mid-January.
The address is the same as always – www.midatlanticcorp.org
– but the site has a completely new look and feel. It’s
been redesigned to be more user-friendly. It gives visitors easier access to
information on Mid-Atlantic Corporate’s different products and services, along
with information on the Corporate’s history and organization. In addition,
visitors can stay informed of Mid-Atlantic Corporate news and featured services
through new homepage links.
The site offers many new benefits to Zephyr® users. Zephyr®,
the member access network, has been overhauled to enable members to do more
online in the areas of balance reporting, wire transfers, returns, flags, cash
orders and file transmissions. Existing features have been enhanced as well.
Report and print functions have been improved and the redesign gives members
more end-user control.
Mid-Atlantic Corporate will continue developing and
upgrading the site after its launch. Future site features may include online
event registration and enhanced image queries.
Log on to www.midatlanticcorp.org
and discover the many ways you can use the site to benefit your credit union.
For
more information, contact Cheryl Hawes, Corporate Account Manager, at
1-800-638-0315, or by e-mail at chawes@midatlanticcorp.org.
Introducing...
The Small CU
Shared Marketing Program
The Delaware League has designed a version of their
Credit Union Shared Marketing Program just to suit the needs of our smaller
credit unions. The Credit Union
Shared Marketing Program offers credit unions the services of our marketing
professional (MP) at a shared cost. That
is, the cost of the services is “shared” with the other participating credit
unions.
The MP can provide your credit union with marketing
services such as:
Initial marketing planning services
Strategic marketing session and assessment
Marketing plan and calendar
Statement stuffer program
Development of four statement stuffers to include in your
quarterly statement mailings
Quarterly newsletter coordination
Coordination and/or composition of articles for your credit
union’s quarterly newsletters
Miscellaneous marketing project
One (1) miscellaneous marketing project of your choice,
including brochure development, niche
marketing project, new member kit
development, annual report compilation, etc.
Look
for more information on this program soon.
10 Youth Marketing
Ideas
Getting
young members introduced to your credit union will begin a financial
relationship that may last a lifetime. Here
are some ideas to plant the “credit union seed.”
- Make a classroom presentation in a local school.
- Invite
a class to tour your credit union.
- Offer
a student service package: student loan, share draft/checking account,
credit or debit card with appropriate limits.
- Make
loans available for youth businesses. (Bicycle
for newspaper route, tools for yard work, animal for 4-H project, etc.)
- Send
congratulations (include give-aways) to high school and college graduates.
- Hold
a “Bring Your Child to the CU Week” and offer gifts and cookies to
members who bring in their children for membership.
- Present
a tree to be planted in your credit union’s name to a school.
- Donate
books or educational materials to school libraries.
- Sponsor
or co-sponsor a youth sports team.
- Hold
an essay contest and award scholarships.
NEWS FROM CUNA MUTUAL
Two Benefit Programs Help Small CUs Maintain Competitive Edge
For a small credit union,
matching the retirement benefit programs offered by larger financial
institutions is a big challenge. It’s
equally frustrating for the credit union employees who prefer to work for a
smaller organization, but feel compelled financially to move to a company with a
stronger benefits program.
CUNA Mutual has two retirement programs that can
help level the playing field. The
Basic Defined Benefit Plan and the Basic 401(k) Plan are designed specifically
for smaller credit unions – ideally ones that have at least two employees and
no staff members making in excess of $70,000 in total compensation. These low-cost alternatives to traditional 401(k), SIMPLE and Defined
Benefit plans maintain many of the features of their higher priced counterparts
– the most important being they offer a secure retirement benefit for your
employees.
The Basic Defined Benefit Plan contains pre-set plan
options, but gives credit unions the choice of selecting what benefit level to
provide and at what age normal retirement should occur. It can also opt to provide benefits for past service. The plan functions as an affordably-priced alternative to traditional
Defined Benefit plans.
The Basic 401(k) Plan also includes pre-selected
plan options. With this plan, the
credit union can elect whether it wants a match feature, and what the matching
contribution will be. It can also
choose discretionary profit sharing contributions. The Basic 401(k) Plan is suited for credit unions that
don’t feel the contribution limitations and/or funding requirements of a
SIMPLE IRA or SIMPLE 401(k) plan meet their needs.
Standard, convenient features for both programs
include:
 | Interactive
web-based employee enrollment, with on-line access to licensed
representatives |
| On-line
statements and account access |
| Interactive
Voice Response System |
| Educational
resources available 24/7 to help participants plan for their future |
| Participant
Support Unit available to answer your employees’ questions |
To learn more about how you can give your employees
the retirement benefits programs of a larger organization, call your CUNA Mutual
Account Relations Manager at (800) 333-2644.
|
Why Market to
Generation Y? |
|
Marketers call the group "generation
Y" -- Americans now under the age of 25. Believe it or not, they
make up more than one-fifth of the U.S. population. They’re a huge
number -- projected to be 1.5 times larger (88 million) than
generation X (56 million). They’ve become the target of marketers and
advertisers, because there are so many of them and because of their
emerging enormous spending power. They
represent the most diverse and technology-savvy generation yet. They
represent a new generation of potential credit union borrowers. When it
comes to their lending needs, what is this group looking for? In a
nutshell: a more customized and personalized borrowing experience. What do they want from a credit union? They want access and convenience. They show a great deal of knowledge about the different types of
financial service providers. They view credit unions as offering
lower rates and banks as providing convenience. They believe both
offer similar products and services. They want "access" – nearby ATMs and nearby branches.
But they don’t want to wait in line. And they’re sensitive to fees. They want to save and invest. They see debt as a
necessity, but they want to save and invest more, starting with small
amounts. They use different savings vehicles — IRAs, CDs, stocks,
bonds, mutual funds, and 401(k)s — and believe saving and investing is
as important as borrowing to attain their goals. They want customized loans. When it comes to
borrowing, they talk about having their financial provider customize
loans to meet their needs. They don’t see that happening now.
They look for more "personalized" service -- loan officers who
counsel and advise, rather than simply process loans. They don’t want to be sold. These young adults don’t
like sales. They're over-solicited: They receive too much junk snail
mail and e-mail and too many telemarketing calls. These
communications are about sales, they say, not about relationships. In a
relationship, your time is respected, the product meets a need —
information is personalized. They believe the Internet doesn’t top personal service.
Gen Yers use the Internet for home banking and for finding information
about a company. But they express concerns about passing information
about themselves to the financial service provider and for finalizing
loan documents. Gen Yers are face-to-face oriented, want to develop a relationship, and
don’t think the Internet can do that as effectively. As they develop a deeper relationship with their financial service
provider, they may become more comfortable using the Internet for
transactions other than checking balances and other home banking
functions. In short, they’re looking for assistance and counsel that
can’t currently be found online. They represent the future of credit union borrowers. You can count on generation Yers to continually build on
their borrowing experiences to create future options. By meeting the
borrowing specifics of generation Yers on their terms, you’re
ensuring the future of your credit union. Reprinted with permission from Bill Klewin of CUNA Mutual. |
|
STAR,
MERIT, or VAP Modules 10%
OFF DELAWARE CREDIT UNION
LEAGUE Tel: (302) 322-9341 Expiration Date: 02/28/03 Minimum order: 3 STAR, MERIT or VAP modules |
|
|
It’s
Annual Meeting Time!
The
first quarter of the year signals the time to begin planning for your Credit
Union Annual Meeting. If this job
has been delegated to you, don’t fret. We
can help.
CUNA has
a wealth of information on planning a credit union annual meeting on their
website, www.cuna.org. The
information includes where to begin, how to market it to members, how to prepare
an annual report, agenda, program, etc.
The
League can provide your credit union with information on speakers, sample
newsletter articles and promotion ideas.
And,
don’t forget those give-aways. Your
League sells advertising specialties and now is the time to order. Don’t wait until it’s too late!
SUCCESSION PLANNING – What to do if your CEO suddenly
leaves
There
are two types of succession planning – the planned event and the emergency
situation. Small credit unions are
particularly at risk, since they typically have only one paid employee.
An
emergency succession plan will ensure that the credit union is prepared for an
unplanned situation such as the CEO’s death, illness, disability or
performance-related termination. An
emergency plan is not a substitute for a normal succession plan; however, it
should be in place before an unexpected situation occurs.
The
emergency succession plan should first designate who is responsible for
implementing the plan. This may be
the board chairman or another director.
First
24 Hours after the CEO unexpectedly leaves:
| Designate the pre-selected internal candidate as interim CEO. This individual should be prepared to step into the position through cross-training and other educational methods. Do they understand the credit union philosophy? Are they familiar with the credit union’s products and services? Are they trained on the credit union’s data processing system? |
| Provide written appointment of the position to the interim CEO including level of authority, board contact, salary terms, whether the board will conduct a professional external recruitment for a new CEO, and the anticipated length of interim CEO assignment. |
| Take necessary security measures. Change computer passwords and building security codes or keys. If your credit union is located in a sponsor’s facility, such as a plant, notify the guard or plant security agents of the change. Determine the need for securing vital records. Cancel corporate credit cards in CEO’s name. Of course, these measures are not necessary in the event of the CEO’s death. |
| Inform employees and members of leadership change. Notify key agencies of change in leadership. |
| Transfer tools
to the interim CEO, for example, check signing privileges, procedure manuals,
etc. |
In the first week:
|
Conduct a transition audit. This may be accomplished by contacting your auditing firm for their assistance. |
|
Implement CEO replacement plan. |
In the first month:
|
Designate
a search committee for the recruitment effort. Seek outside
consultants for assistance. Your league may be able to help in this area. |
Credit
unions are in the business of managing risk.
Every credit union is at risk of losing its CEO or other key personnel.
This risk can be managed effectively with systemic and thoughtful
planning.
Essentials is
published quarterly by The
Delaware Credit Union League,
4 Quigley Boulevard, New Castle, DE
19720
Phone: (302)
322-9341 or (800) 292-7875 Fax: (302) 322-9354
Editor: Jane Bailey E-Mail:
jane@dcul.org