What Can Credit Unions Learn From Regulators? (Part 1)

Former examiners who now serve in the credit union C-suite talk about why they switched careers and what they have to offer the cooperative movement.

 
 

The credit union regulatory environment is intended to provide safety and soundness to a movement that has nearly $2 trillion in assets and more than 125 million member-owners. For credit union leaders, compliance is a fact of life. So, too, is working with the regulators and examiners responsible for ensuring said compliance.

With good reason many former examiners now work as senior credit union executives, bringing with them connections, inside knowledge, and an understanding of what the regulator is trying to achieve. These leaders appreciate the movement’s ability to make a difference in the lives of members within its regulatory boundaries, and they have a lot to say about their experience on both sides of the table.

Read: What Can Credit Unions Learn From Regulators? (Part 2)

Jim Hayes, President/CEO, Andrews Federal Credit Union

Jim Hayes, President/CEO, Andrews Federal Credit Union

Jim Hayes' 12 years as a regulator included working as an examiner with the Office of Thrift Supervision from 1991 to 1996 and then as a capital markets specialist with the NCUA from 1996 to 2003. He joined Andrews Federal Credit Union ($2.2B, Suitland, MD) as its chief financial officer in the fall of 2010 and became its president and CEO in July 2013.

What made you decide to work for a credit union rather than stay in a regulatory role?

Jim Hayes: When I left the NCUA to work for a credit union, I was hired to oversee marketing and business development. The opportunity was intriguing because it exposed me to the softer side of the business versus the technical, financial side. I was excited to broaden my exposure to more parts of the business to gain a more balanced experience. It pulled me out of my comfort zone.

As a former regulator, what value do you bring to your credit union?

JH: I strive to see the entire horizon while taking in scenarios from multiple perspectives. Maintaining a dual perspectives philosophy helps me understand how decisions impact more parties. I try to view each situation from a member’s perspective, an employee’s perspective, and a regulator’s perspective. This has permitted me to make better, more informed decisions with fewer unintended consequences.

What advice do you have for bringing someone from the regulatory side into a credit union shop?

JH: Credit unions should look for individuals who are a good cultural fit and are willing to take, and appropriately manage, a little risk. It’s no secret that taking any risk can feel unnatural to examiners. I can understand that. It’s a little out of the ordinary.

The danger in a risk-aversion approach is that insights uncovered through risk-taking are not identified and you are peripherally blindsided. You need some willingness to take on and manage risk. Those who can do so appropriately can become respected team members who bring valuable insights.

Rick Weber, President/CEO, CBC Federal Credit Union

Rick Weber, President/CEO, CBC Federal Credit Union

Rick Weber was with the NCUA from 1991 through 1998, with principal examiner as his last title. He joined CBC Federal Credit Union ($626.2M, Oxnard, CA) in 2016 and became the permanent president and CEO in March 2020, capping 30 years working as a regulator and as an executive with small and large credit unions.

What made you decide to work for a credit union rather than stay in a regulatory role?

Rick Weber: After being an examiner for seven years, I lost my passion for observing and being a referee. I wanted to be part of a team and actually play the game.

As a former regulator, what value do you bring to your credit union?

RW: The NCUA provided great training and the experience was amazing. Through examinations, reviews, and observations, I could see how most areas of the credit union operated and how they drove the financial performance of the organization.

In seven years with the NCUA, I reviewed and observed hundreds of strategic plans as well as the best and worst practices within the industry. Spending a week or two at many different sizes and types of credit unions is a quick way to learn an industry.

What advice do you have for bringing someone from the regulatory side into a credit union shop?

RW: An examiner brings a great deal of knowledge and is also skilled to research an answer that is not known. The NCUA provides some of the best high-level technical training while the examination process provides real-world observations for each practice and how it all fits together.

Many examiners are successful at making the transition from regulator to executive, but it’s not easy. Examiners, like myself, assume that running or leading a credit union is more about numbers and following processes than anything else; however, this couldn’t be further from the truth. The examination process doesn’t give exposure to the working culture of the credit union and what it takes to motivate, recruit, develop, and retain a successful team. Nearly all who eventually succeed with the transition from examiner to executive have become good communicators to go with their depth of knowledge.

Beth Dooley, Educational Employees Credit Union

Beth Dooley, Educational Employees Credit Union

Beth Dooley managed the credit union division of what is now the California Department of Financial Protection and Innovation from late 2000 through late 2007. She has been CEO of Educational Employees Credit Union ($4.4B, Fresno, CA) since December 2007.

What made you decide to work for a credit union rather than stay in a regulatory role?

Beth Dooley: While serving as a regulator and having previously worked at the California Credit Union League, I saw the impact that credit unions have on the communities they serve, and that appealed to me.

My transition to EECU coincided with the start of the financial crisis, during which we assisted a number of members who were struggling financially. I’m proud of the continuing support we provide to our members and the greater communities. Credit unions truly embrace the motto of “People Helping People,” and I am thankful to be part of the movement.

As a former regulator, what value do you bring to your credit union?

BD: Prior regulatory experience provides significant benefits to a credit union. Understanding a regulator’s concerns and why those issues are important is helpful and makes it easier to come to a mutually agreeable resolution on issues.

Prior regulatory experience also provides a different perspective on the regulatory and legislative processes as well as a different view of politicians and how they might approach proposed changes. Lawmakers often seek input from the regulators about proposed changes.

Perhaps most importantly, regulatory experience provides the benefit of seeing the operations of many different credit unions. You see what works well — and why — in one credit union but not so well in another.

What advice do you have for bringing someone from the regulatory side into a credit union shop?

BD: I would encourage credit unions to give serious consideration to candidates with regulatory background, and candidates who have at least a few years of regulatory experience will have a greater breadth of experience upon which to draw. I learned things as a regulator I would not have learned anywhere else. Other credit unions could derive a similar benefit from someone with this type of experience.

MJ Coon, CFO, Ent Credit Union

MJ Coon, CFO, Ent Credit Union

MJ Coon was with the NCUA from July 1987 to January 1998, first as a field examiner, then helping to develop a new examination platform, and then as one of the first examiners in the new corporate credit union division. She has been chief financial officer at Ent Credit Union ($7.9B, Colorado Springs, CO) for 23 years.

What made you decide to work for a credit union rather than stay in a regulatory role?

MJ Coon: A big reason was the travel. It’s hard to maintain a normal life when you’re on the road every week. One year my district was Phoenix, Connecticut, and Seattle. My office and home were in Orlando at the time.

I also was interested in being in a job where I could make more of a difference. In a government agency, you’re not the one making the call on a lot of matters. And the wheels turn slowly. You can suggest something, and maybe a year later it might happen.

As a former regulator, what value do you bring to your credit union?

MC: When I joined Ent, it was a very different organization. We were a $1.2 billion credit union where nobody could spell ALM. With the NCUA, I reviewed ALM at corporate credit unions. Before that, as a regular examiner, who knows how many thousands of loans and investments I reviewed over the years.

When I joined Ent, I became one of a group of new leaders who helped turn around a troubled credit union. I introduce the concept of ALM and brought an understanding of how we needed to upgrade our financial management and reporting.

Because of my NCUA experience and contacts, I also brought value as a liaison between Ent and the agency at a time when things were a bit tense. I was lucky to have a lot of broad experience at the NCUA, and we made it work at Ent. I’d like to say my work ethic, drive, and ability to learn helped me succeed.

What advice do you have for bringing someone from the regulatory side into a credit union shop?

MC: Regardless of where they’re coming from, do your best to ensure they have not only the qualifications but also the intuitiveness and drive to be successful self-starters with real follow-through.

I don’t know how you interview for that. A good place to start is with someone who has significant financial institution experience, not solely regulatory experience. Hiring is always a gamble. We all know that. If you’re hiring for a leadership position, your interview questions need to be more in-depth. Personality and big talk are not everything; you need to find out if they will deliver. I’m a good actress, and so are some candidates. Only time tells you if you scored or not.

Don’t stop here. Read: What Can Credit Unions Learn From Regulators? (Part 2)

These interviews have been edited and condensed.

Want more credit union strategies? Sign up for the CreditUnions.com free newsletter.