MADISON, Wis.-A new report suggests it will be increasingly hard to justify building and staffing branches in traditional ways without strategic thinking on how to drive down branch costs or drive up branch-dependent revenue.

The report, "Identifying and Managing Overstaffed Branches," is the third in a four-part series that identifies and quantifies cost items at credit unions that is being produced by the Filene Research Institute.

"Credit unions should have a firm grasp on their costs, but detailed cost analysis is not always easy to do," Filene said. "This brief 's primary purpose is to point the way for credit unions that would like to analyze their own offerings and to offer benchmark numbers to credit unions without the resources to do their own detailed cost analysis. Thus, the data given are directionally useful, even if the credit unions cited differ from yours in size."

The Filene report added that what is noteworthy is that of all the members who solely used the branch for savings account withdrawals, fully 65% of them were unprofitable at a member level.

As a final point of emphasis, noted the analysis, "this brief does not take a position on whether branches themselves are a problem. They are too intertwined in most credit unions' delivery strategies to consider abandoning altogether. Instead, this report should be read as a critique of the urge to drive transactions to the branch when they can be better conducted elsewhere. Moving the members with a low profitability profile toward channels that will improve their profitability profile will better serve all members, who expect the credit union to grow and thrive."

For info: www.filene.org.

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