We have record unemployment, sky-high foreclosure rates and consumer confidence is in the cellar. These truly are the times that try men's and women's souls, particularly those in our industry.
Yet, I believe in 2010 credit unions have quite a lot to look forward to. Credit unions are uniquely poised to continue to reignite consumer confidence and to continue to reach out to prospective members who may have become disenchanted with their existing financial institutions. Overall, we have benefited considerably from the heightened attention on personal finance and the economy that has produced a newfound level of awareness and appreciation for us. This has created the perfect scenario for many to revitalize their strategies and leverage these new market conditions.
At the same time, we must stay focused on our vision. According to Michael Hyatt, CEO of Thomas Nelson Publishers, vision is the first casualty when times are tough and the first thing we must recover before conditions can improve. We must inspire our teams to see the value in every member transaction to help us continue to build our long-term prosperity and success. It is the solid, fundamental practices of superior member service and prudent financial management that have distinguished us over the years, earned us legions of satisfied members and suppressed many of our critics. We must champion these practices at every possible turn.
Moreover, in these turbulent times, the assurances of the safety of our federally insured deposits may be just what some folks are eager to hear and the key to winning over new members. Promoting that deposits, or member shares, in the nation's credit unions are federally insured by the NCUA, carrying the federal government's full-faith-and-credit guarantee up to $250,000, is welcome by many.
To succeed this year, we cannot just wait to see what the economy does. We must make things happen. We must be innovative, proactive and flexible in defining our future. While we must adhere to our fundamental values, we can find new ways to promote them. Social media or other new technology may afford many credit unions the perfect way to reach out to existing and new members.
We can also engage existing members in new services or programs through more on-site events or online features. Many credit unions that participated in promotional programs like America Saves or Military Saves, which NAFCU coordinates in partnership with the Consumer Federation of America, used the event to offer special interest rates for new members and saw great results. Credit unions interested in participating in the program, which will be held from February 21-28, can access materials at www.americasaves.org.
Additionally, two of the biggest groups impacted by the current economic conditions-homeowners and small business owners-represent great opportunities. In 2009, credit unions held 5.2% of the mortgage market, a dramatic increase from 2% in 2005. While there is still room for growth in 2010's mortgage market, we must also continue to direct our energies to working with homeowners to help them stay in their homes.
In terms of small business owners, they, too, are particularly suffering under the current credit crunch. Credit unions can step up to help them either through member business lending or SBA 7(a) loans, which are not subject to the lending cap. While we are steadfast in our efforts to lift this cap, the continued success stories of those small businesses we help will be our best selling point.
Ultimately, we must recognize how we perform in the marketplace will either affirm our position as "the original consumer protection agency" or give overzealous critics ammunition to pursue more legislative and regulatory restraints. It is no coincidence that as our economy has faltered, the legislative and regulatory agendas have exploded.
I believe 2010 is a new beginning. It can be a good year for credit unions if we, as former GE CEO Jack Welch says, "Face reality as it is, not as it was or as you wish it to be." We need to continue to stay on top of our game. It may take additional effort but staying nimble even in 2010's challenging economic and regulatory environment will serve us well.
Brad Beal is chairman of NAFCU and CEO of Nevada Federal Credit Union. Mr. Beal can be reached at BradB@NevadaFederal.org.
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