One of the best things about consulting with credit unions is spending time with volunteer boards who are committed to the idea of being a member-owned cooperative.
And one of the times that are most fraught with temptation for those volunteers to give up the fight is when a longtime leader of that institution moves on and it’s time to find someone who shares that zeal.
Callahan & Associates had that experience recently with a credit union of less than $100 million whose CEO of more than 35 years was retiring. This is the point where many smaller credit unions choose to turn in their charter and merge.
It’s understandable why. It’s hard enough keeping up with the products and services demanded in today’s market, but then there’s the challenge of finding someone to fill that top job — hopefully for a long time to come.
Why not take the easy road out, wave the white flag, and call it a day? Thousands of small credit unions have done that over the past several years.
But not this outfit. The outgoing CEO gave two years’ notice, and the board members allowed us to share some ideas for how to move forward. The board also had one idea of its own: find a new CEO with experience leading mission-driven organizations, whether or not that’s a credit union.
In other words, this board decided a commitment to the mission — shown by experience successfully leading a not-for-profit for the benefit of the people it serves — is more important than the financial services experience itself.
It’s an unusual path, but when you think about it, it makes sense. This particular credit union primarily serves a local school district and a parochial school along with some business SEGs in its hometown, a community of approximately 6,500 people.
This financial cooperative also is a Community Development Financial Institution; it’s 100% mission focused.
The board members recognize this is probably a risky direction to take ... But, ultimately, they decided they are a mission-driven organization that delivers on its mission through a credit union charter.
It’s also performing adequately — right in line with its asset-based peer group nationally in terms of loan and share growth and ROA — and has solid management in place. It offers mobile banking, financial education, and loans and savings accounts and checking options the majority of consumers expect.
Why not stay the course?
The board members recognize this is probably a risky direction to take, compared with finding someone from the financial services business or merging. But, ultimately, they decided they are a mission-driven organization that delivers on its mission through a credit union charter.
We’re glad they decided to keep it.