DES MOINES, Iowa-Jeff Russell has always believed that market share can be gained during a down economy, and the current recession hasn't changed his thinking.
"We've seen credit unions' credit card portfolios grow, and ours as well," stated Jeff Russell, VP-strategic planning and development for The Members Group. "Organic growth in our portfolio was 10% last year."
Russell attributed the growth to consumers' dissatisfaction with banks and the flight to safety, but reminded that those CUs that have capitalized are the ones telling their story. "That opportunity is going to be here for a while," he said. Many credit unions learned quickly that they can also reduce losses by engaging with members early when they encounter financial hardships. "Life events happen," Russell said. "Members lose jobs and unexpected things come up. The earlier you can engage with members around their loans, credit cards in particular, the more success you will have. They are really looking for a roadmap on how to get out. It can feel pretty overwhelming."
Perhaps the most critical lesson taught by the recession is the importance of staying diligent on risk management practices. "You are scoring your credit card portfolio regularly, watching underwriting regularly, and looking for signs of trouble," outlined Russell. "The bane of our existence is the member who has a 720 credit score and has never been late on a payment and files for bankruptcy. That has happens more often than we would think."