Metsger encourages CUs to REACH
Rick Metsger, current NCUA board member, former NCUA board chair and also former credit union director when he lived in Oregon, told the audience in his waning weeks and months on the NCUA board, he and current chair Mark McWatters are working toward the “betterment” of the credit union system, “because the system is more important than either one of us.”
For several years now, the name of the California and Nevada CU Leagues’ Annual Meeting and Convention has been REACH. Metsger went through the name letter by letter to offer his advice to credit unions:
R = Relevance.
“My job as a regulator is to make sure credit unions remain relevant in a changing industry,” he said, holding up his smartphone. “In 2004 the smartphone did not exist, but today it is the financial institution to many people as branch visits decline.”
E = Efficiency, effectiveness, evolution.
Metsger said NCUA has become “a lot more efficient” through a number of recent initiatives, including reducing its number of field offices to three from five. “We have gone to an 18-month exam cycle for well-run credit unions. We look to measure if we are effective and if we are evolving.”
A = Asset diversification.
“If you were the best at lending for taxi medallions, then you are in conservatorship,” he said. “You have to have an asset portfolio that reflects divergence.”
C = Capital.
“Capital is king,” he declared. “You have to have capital so you are here next year to serve your members, and the year after that.” With that said, Metsger acknowledged there are credit unions that hold too much capital. “Some credit unions have 17 percent capital. They tell us, ‘Our members don’t borrow.’ That does back to R and E – are you relevant and effective with your members?”
H = Honor the heritage of the credit union system.
“Remember why the not-for-profit alternative is so important in this country,” he said. “Don’t just have a mission statement that you look at once in a while, live your mission in the services you provide and the platform you provide.”
Metsger offered the example of hockey hall of famer Wayne Gretzky. When asked why he was so successful, Gretzky said from a young age everyone is taught to skate toward the puck, while he skates to where the puck is going to be.
“In financial services, skate to where the puck is going to be, not where it is,” Metsger counseled.