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Fading Pages, Strange Theories, Rumors & Opportunities

Oddly, for a country that pioneered the concept of "closure" and that couldn't rest until a movie was finally made showing Gilligan and the others being rescued from the island, mergers never seem to have an epitaph.

We seldom give much thought to 50% of the meaning of any such combination. The focus is all on today, the future, and the Holy Grail, those sought-after efficiencies. Left behind is what's left behind, the origin and history of the organizations, their heritage and what their lives might have meant and contributed to the present.

Last week a couple more pieces of credit union history made their way to the CUNA archives in Madison, perhaps never to be seen again until some future Credit Union Journal editor is assembling the 200th Anniversary of Credit Unions issue.

In Salinas, Calif., Steinbeck Credit Union announced it would be absorbed via merger by Sacramento-based giant The Golden 1. The credit union held the unique distinction of being named after the acclaimed, Nobel-prize winning author John Steinbeck, who chronicled the struggles of California's poor working class in classics such as "Cannery Row" and "The Grapes of Wrath." The characters in those novels would go on to be the kinds of people who founded, and needed, credit unions. Coincidentally, given the fate of the credit union named after him, Steinbeck's first novel was "Cup of Gold."

Much further to the East, the Alabama league met for the 76th and final time last week. Next year it will have merged with the Florida league to create the League of Southeastern Credit Unions, a name that seems to suggest it's an open invitation to other states to come under its umbrella in the future ( I personally would have favored the "Sweet Tea League").

For retiring CEO Gary Wolter, it marked the end to 47 years in credit unions. At first blush it's tempting to suggest the days of credit union execs with careers spanning five decades are over, but given the state of 401(k)s, that prediction may be premature.

  • Talk about odd hype: received an e-mail with this subject line, "Top Credit Union Promotional Products for the New Great Depression."
  • From the Bittersweet Compliment Dept. Like a member telling you he or she knows they get a better deal at their credit union because the credit union "is a tax-dodging cheat," compliments sometimes need clarification.
Case in point: an e-mail was sent to me last week in which a couple of credit union execs were discussing why Credit Union Journal so frequently breaks news (the word they used was the old-fashioned but still valued "scoop") ahead of other publications. One of the e-mailers responded by saying they had heard it's because the Journal is owned by the "American Bankers Association."

Setting aside for a moment the fact that even if it were true, it's pretty absurd (since when do bank trade associations have unique insights into credit unions?), Credit Union Journal is an independent news organization proud of its role in delivering news (even though it's not always good) and resources to growth-oriented credit unions. Moreover, no publication has woven more into its editorial fabric coverage of credit union philosophy and value than Credit Union Journal. The confusion may be caused because the Journal has a sister publication in American Banker (which is also independent and has no ties to ABA, by the way).

We will continue to work to scoop the competition and serve our readers (and are happy to see Credit Union Journal's work being recognized, in spite of the theory).

  • Despite the publicity that surrounded the conservatorships of U.S. Central and WesCorp, for the most part credit unions in the U.S. have escaped the crisis in confidence that has surrounded many of the country's banks and even the banking system's insurance fund. Indeed, the press has been pretty positive for America's not-for-profit financials.
But that's not true everywhere. The Irish Times recently reported that Killarney Credit Union had issued a public statement "to quash unfounded, vicious and scurrilous rumors" about the state of its finances and to assure members...it was "safe and sound."

The newspaper further reported that the "directors and supervisors of the credit union are conducting an investigation and it is understood they are confident of getting to the source of the rumors..."

  • Meanwhile, in Scotland, the Scotsman reported that, "Disillusionment with banks has fueled an 'extraordinary surge' in membership of credit unions...
"The authority said applications to join some credit unions in the west of Scotland had risen by about 38% in the last six months. It has launched a new campaign to raise awareness of credit union services..."

That means Scotland has now joined Poland in launching a national campaign seeking to leverage a unique set of economic circumstances, and the resulting consumer perceptions, to the benefit of credit unions.

"People are feeling uncertain about the current banking situation and are placing more trust and reliance in the credit union movement based on a co-operative and ethical approach to financial services," Robert Kelly, general manager of West of Scotland NHS Credit Union was quoted as saying. "We are a viable and sustainable alternative to banks and this is exactly what people are looking for just now."

Back in the U.S., the national media effort to better spread the word about that viable and sustainable alternative is, well, um...

Frank J. Diekmann can be reached at fdiekmann@cujournal.com.

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