We made two changes as the result of the recent recessions.

First, we brought our first mortgage program in house. In 2008 we made just over $55,000 on the gain on sale of first mortgages. At that time we were working with a local CUSO that did an excellent job servicing our members, but they kept most of the profit on the sale. In 2009 we were approved by Fannie Mae, Freddie Mac and the Federal Home Loan Bank and launched our in-house program.

We realized a significant increase in income from the program almost immediately. In 2009 we earned $474,339 in revenue on the gain on sale of first mortgages. In 2010, we earned $662,467, in 2011 we earned $613,712, and through May of 2012 we earned $481,540.

Second, we implemented a high-yield lending strategy. Between March of 2009 and March of 2010 we noticed a significant decline in our loan yield, declining 16 basis points over that time.

Many of our members experienced a significant drop in their credit scores due to the economy and as a result we began denying many more loans.

This had an adverse affect on our loan yield and income. We partnered with Rex Johnson in 2011 and implemented the High Yield Lending Strategy. As a result our yield went from 6.05% in March of 2011 to 6.42% in March of 2012. Our peer average stood at just 5.85% in March of 2012.

We learned that we must react quickly to changes in the economic and regulatory environments. Fortunately, as a smaller credit union it is easier to implement change and "turn the ship" in a different direction. Our ROA went from -0.10 in March of 2011 to 1.15% in March of 2012. Without these changes I have no doubt that our ROA would have continued to be negative.

Keith Wiemert
President and CEO
Seasons FCU, Middletown, Conn.

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