Callahan’s Return Of The Member [ROM] Index Quantifies Member Value

The ability to create shared member value differentiates credit unions from other financial services providers.


Credit unions are different from banks. Sure, credit unions and banks both offer financial services, but credit unions don’t have stockholders to distract management and skim off the profits.

As cooperatives, credit unions serve — and answer to — their member-owners. Credit unions are mission-driven, non-profit entities, which means they can direct all their attention to providing the best deal to members. When necessary, they can maximize member value at the expense of the bottom line, keeping in mind they must earn some net income to put toward  future product and capital investments.

ROM goes beyond traditional safety and soundness issues covered by CAMEL scoring to instead assess member value.

The industry prides itself on offering superior rates, products, and services. But quantifying member value is tricky. That’s why more than two decades ago, Callahan & Associates, a credit union research and consulting firm based in Washington, DC, developed Return Of The Member (ROM)

Callahan launched ROM as the industry’s only holistic scoring system of member value. It still holds that honor today.

ROM captures a comprehensive view of member value by considering aspects such as:

  • Rates: Are the credit union’s loan rates lower or deposit rates higher than its competitors?
  • Options: How many products and services does the credit union offer?
  • Usage: How many members use these products?

What Is ROM?

As of March 31, 2018, credit unions served more than 114 million members. ROM offers a way to demonstrate the tangible benefits of credit union participation and ownership. It goes beyond the traditional safety and soundness issues covered by NCUA’s CAMEL scoring and other examinations to instead assess member value. 

ROM uses data from the 5300 Call Report to capture all aspects of a member’s relationship with the credit union. Callahan has adjusted and reweighed this member-value metric over the years to reflect the evolution of the credit union industry and the ever-changing call report.

ROM measures three core credit union functions:

  • Savings: The Return To Savers component of ROM measures how well a credit union is providing deposit services to members. It takes into account aspects such as dividends paid, changes in share balances, and the number of share accounts per member.
  • Lending: The Return To Borrowers component of ROM pays homage to the fact credit unions were created to provide credit at a reasonable cost. It takes into account things like loan rates  rewarding those institutions that offer lower rates  as well as a credit union's growth in lending and product variety. Because of the increased participation in the secondary market, Return To Borrowers also considers a credit union's loan servicing portfolio. 
  • Usage: The Member Service Usage component of ROM measures whether members are using the credit union as their primary financial institution (PFI). It considers performance in areas like the number of core accounts a credit union holds and penetration rates as well as employee measures like productivity and revenue generated per dollar of salary and benefit.

ROM assigns a value between 1 and 100 to every credit union based on its performance in these three core functions.  It then takes into account a credit union’s performance in comparison to its asset-based peer group to calculate a percentile rank. The credit union’s final score combines the weighted average of the percentile ranking for each ratio.

Credit unions with a score of 100 are the top leaders in providing value to their members.

An Example: ABC Credit Union  

ABC Credit Union is a $1 billion institution.

ABC Credit Union Weighted Score Percentile Rank Final Score
Return To Savers 61.25 74.69 22.4
Return To Borrowers 71.10 80.52 28.2
Member Service Usage 82.50 88.19 30.9
ROM   82.13 81.50

ABC’s Return To Saver score of 61.25 represents the credit union’s weighted score in the first of the three core areas. ROM then ranks this weighted score as a percentile versus all other peer credit unions. For ABC, that percentile rank is 74.69. Finally, ROM reweights the percentile ranks to generate a final score in the category. For ABC, its final Return To Savers score is 22.4.

ROM uses the same kind of calculation to determine ABC’s scores in the Return To Borrowers and the Member Service Usage components.  

What Does A Score Of 81.5 Mean?

The score of 81.50 represents ABC Credit Union’s final ROM score. As a percentile versus all other peer credit unions, this score equates to a rank of 82.13. Therefore, ABC is performing better than 82% of the credit unions in its peer group, well above the average score of 50.  

There are still areas for improvement, however. ABC ranked in the 80.52 percentile in Return To Borrowers, which could indicate ABC is offering less competitive loans rates to members. On the other hand, ABC performed much better than its peers in Member Service Usage, scoring an 88.19.

Does Higher Member Value Yield Greater Performance?

The drive to increase member value is generally to promote growth, which leads to the ability to add products and services while giving back to members in the form of better rates. This cycle benefits both the member and the credit union.

It is safe to assume top-performing ROM credit unions also perform well in the metrics included in the three ROM components. But, do credit unions with higher ROM scores perform better than those with lower scores? How do they fare when looking at criteria outside of the ROM elements?

The peer group below is composed of credit unions with $1 billion or more in assets as of March 31, 2018. Credit unions that scored in the top 10 percentile of ROM are compared against those that scored in the 45 to 55 percentile.


Source: Peer-to-Peer Analytics by Callahan & Associates

Credit unions that rank higher in ROM, like the credit unions with $1 billion or more in assets represented in this table, tend also to perform better in other areas.

As shown here, the group that ranks higher in ROM also performs better in other areas. Providing high member value creates a virtuous cycle of performance: Credit unions provide products and services that maximize member welfare, in turn, members more fully use the offerings of the financial institution

Callahan’s ROM scoring system is not designed to be the final word on credit union performance. However, it is an important measure of the economic return a credit union provides relative to other credit unions of similar sizes according to available public data.

How Do You Compare?

Discover how much value you return to members using Callahan’s proprietary metric developed specifically for credit unions. Contact Callahan & Associates to see how your credit union stacks up.






Sept. 10, 2012


  • UICCU is smashing everbody out of the water on ROM. They can't be stopped.
    UofI Alum
  • Great question, Jim! You can find your credit union’s ROM score in CUAnalyzer, Peer-to-Peer, or CUSP Online. ROM scoring is updated once per data cycle, so be sure to check your ROM score in March, June, September, and December.
    Rebecca Wessler
  • We love using the Return to Member scoring to evaluate how well we give back to our membership. Although we rate highly, I disagree slightly with the fee income component. We take great pride in our low fees and lack of fees compared to our peers, but we have very high debit and credit card interchange because of very high penetration of both products. While this is included in fee income, it is really not fees to the member. Our fee income score is very low because of this. Just something to consider.
    Daryl Emopen
  • Daryl - thanks for the comment. Fee income and other operating income does indicate member usage of products and is not just a judgement on the credit union's fee schedule. In the ROM calculation though, we do include just fee income as a negative factor. In our experience, most credit unions put interchange income into the Other Operating Income line item on the 5300 so this transaction income is not a deterrent to ROM scores.
    Lydia Cole, Analyst
  • How can a CU get their ROM score?
    Jim Riederer
  • Checking quickly I didn't notice a way to compare my ROM with other institutions OR peer that capability there and I missed it ?

    thank you
    David Lansinger
  • thanks for asking...