Author: Chip Filson

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The Power of Community

The strategic advantage that is the foundation of every credit union is its local roots.   Local does is not just a geographic focus.   It includes connections,  relationships, reputation and knowledge that extends back years, or even generations.

This advantage allows members to see the coop as part of their community.  It is a financial and physical presence that helps define the character and economic opportunities for their neighbors.

Unfortunately some actions can compromise this long standing presence, especially mergers which often eliminate any vestiges of a credit union’s roots.  No more local employment, direction, or participation in community life and leadership remains.   Only a virtual connection is left, which may serve some well, but others not at all.

An Example of Why Community Matters

Sometimes it is easier to see this critical role from another industry’s perspective.  The following is the story of both the demise and the resilience of local newspapers.   This editorial is from the October 23, 2024 Falls Church News Press.

This week is an especially sad one in the hometown of our editor.   Following the termination last year of the publication of the Santa Barbara News Press, after over 100 years, this week its remains were being sold off in an online auction, bit by bit, pennies for the dollar.

Meanwhile, the old Spanish Days-styled News-Press building downtown is gutted, like mugged stabbed and left for dead behind a dumpster where so much activity and discourse on the direction of the community took place daily for so many years.

A supporter of this News-Press for which this Falls Church one was named, and where our editor began writing while in high school, made the point last week talking about the importance of community newspapers:

It’s not just about news, per se, but about the dialogue on the interests and future of the community that is a local newspaper’s essential component. It isn’t about whether or not a newspaper’s slant or editorial content is agreed to or not, but it is the way in which the newspaper enters the homes of residents, by way of being gathered off the roof or out of a rose bush as tossed by a wayward delivery boy, and read and discussed for its contents in the  midst of the daily life  of the community which makes it so essential. 

It is the entry point for a community-wide dialogue involving everyone. It is a proxy for the community itself, as it were, its agora, or public meeting space as per the ancient Greek city-states, delivered ito every home where matters are fleshed out and elevated to everyone’s common interest and concern. 

This is what a newspaper is, and to be its best, it has to be in print form in full physical, sensual and tactile presence, to function most adequately and widely where no element of an entire community can be neglected or dismissed.  Also, at best it is the product of a member of that wider community, a citizen exercising a calling to provide the service in question according to the highest of principles, and not the government, to most effectively trigger that community engagement.

The Credit Union Parallels “When At Their Best”

While the functions of a local newspaper and financial institution are very different their contribution to a sense of community is similar.

The daily role and public need for local community financial institutions mirror many of the same contributions of a local newspaper.   The credit union’s presence is seen, it is locally directed by those who view their roles as volunteers or employees as a “calling.”  It is the collective for borrowing and savings by individuals and organizations to better their futures. Finance, like news, is an essential service.

Decisions made locally for the welfare of all give cooperatives a special function alongside the many other institutions vital for living and working together in common purpose.  By design they pay their success forward to benefit future generations.

(Note:  For a current example see press release, 717 Credit Union Launches “Forever Youngstown” Initiative)

These coop business virtues sustain both large and small credit unions.  They contribute to a sense of shared identity that is more than just geographic boundaries.  Financial services is a critical part of the fabric of any  community in which individuals choose to establish their identify and live their lives.

When credit unions make this contribution they are showing their”best selves.” Unfortunately other motivations and temptations can come along that  negate these cooperative advantages. That situation will be the subject of a future case study.

 

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A CEO and Former Marine Communicates with His Members

This brief message is an example of a CEO using a personal story to teach the importance of a critical  consumer discipline: personal savings.  It should resonate with his core members at Camp Pendleton.

“Whether tackling debt, building savings, or thinking about retirement, financial fears can freeze us in our tracks. It’s easy to feel stuck, not knowing where to start.

“Here’s the thing: even the best budgeters and investors have stumbled. I know I have, and I bet you have, too. What matters isn’t our mistakes—it’s how we recover and move forward.

A Lesson from the Marines

“In the Marines, I learned that no obstacle is too big to overcome. The key is staying focused, learning from experience, and taking that next step. The toughest situations often teach the most valuable lessons.

“I’ll never forget when I was a young Marine at Kaneohe Bay, Hawaii. Shortly after arriving, I competed for and earned a spot in the Reconnaissance Company. I could share countless examples of challenges I faced as a Recon Marine, but the one that stuck with me most wasn’t from the battlefield.

“After a week of tough training, the Company Gunnery Sergeant asked us one simple question: “What are you doing with your money?” With free housing, meals and healthcare, our expenses were minimal. His point was clear—were we making the most of it?

“My answer didn’t sit well with him—and it wouldn’t be the last time. Turns out, I had a knack for getting the Gunny fired up. I proceeded to receive a 10-minute tongue-lashing on saving. He ordered me to set up an allotment to buy a Savings Bond every month—and I did because you don’t argue with a Marine Gunnery Sergeant!

“His advice didn’t stop there. He told me to increase my bond purchases with every promotion or pay raise. His final lesson? Live within your means and know the difference between needs and wants. While I admit to blurring that line at times, his advice stuck.

“Years later, as a Gunnery Sergeant myself, I cashed in those bonds to open an investment account and was amazed at how much I’d saved, bit by bit. Those lessons in saving and budgeting helped my wife and me buy our first home and start our family—something I owe, in large part, to that Gunnery Sergeant’s wisdom.

“As we close out the year, now is the perfect time to make those small moves that can set you up for success in 2025 and beyond. Start a savings habit, set achievable financial goals or fine-tune your budget. You don’t need to wait for New Year’s resolutions—starting now takes that weight off your shoulders. It’s not about being perfect. It’s about making progress.”

(Source:  Frontwave’s President Bill Birnie, October 22, 2014, Notes from the CEO)

 

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Two Thoughts on Leadership

Credit Union Visionaries:  Do we have so few credit union visionaries because we’re a non-prophet movement?  (Jim Blaine, February 2011)

From the cadet prayer at West Point:

Encourage us in our endeavor to live above the common level of life. Make us to choose the harder right instead of the easier wrong. . .

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A Credit Union Election Example for the Whole Nation

Freedom is based on democratic elections.  In these contests, there will be winners and losers.

In the current Presidential election a major portion, 45% or more of voters, will be disappointed that their candidate did not win.  One candidate has yet to even acknowledge the results of the 2020 contest!

Contestants and their supporters pour their hopes, resources and emotions into the campaign.  It is hard to accept a loss.   But recognizing that outcome is what is required  if democracy  is to prevail.  And if one is still committed, prepare a Plan B.

An Example of Principle from SECU’s Board Election

The October board contest for the four open director seats at SECU (NC) was hard fought over issues raised two years earlier.  It is a rare, but vital example, of the members’ governance role in a large financial cooperative.

SECU’s election process favored the incumbent directors who were renominted by their board peers.  The credit union promoted their support on social media and in PR posts.

For the member-nominated candidates and their supporters it would be easy to cry “foul” and argue the process was weighted against them.  For it was.

However that was not the stance posted by Jim Blaine, the voice  of the opposition candidates, who heard these complaints.

On the day after the election results were announced, he posted the following blog:

Wednesday, October 9, 2024

2024 SECU Annual Meeting: The Members Make A Statement

   … hard to miss that statement!

In case some of you missed it (and some of us wish we had!), the SECU membership voted by a 2 to 1 margin at the Annual Meeting yesterday to elect the four incumbent directors Bob Brinson, Mark Fleming, Stelfanie Williams, and McKinley Wooten

The election was hotly contested and @100,000 SECU members participated in the election and balloting process – a remarkable turnout. A healthy sign of member interest and participation! As you’ll note from the resulting flurry of blog commenters, there was much excitement and disappointment.

What you can’t see are the numerous deleted comments complaining about a rigged election and unfair tactics, etc, etc. I happen to believe the board election process was fair – period! 

We all need to “get over” the whine that if our views don’t prevail, that something underhanded was done – not so. And, that doesn’t apply to this election only, if you know what I mean.

Now, if some of you suspect that my views haven’t changed on the key issues, then we understand each other well. The reports given at the Annual Meeting provided some interesting information which we will analyze over the next few days. That review may help create a “baseline” of financial facts, against which to measure the progress of SECU, as it moves on into the future.

😎 Personally, congratulations to the new directors and – as always – I wish State Employees’ Credit Union and its staff well! 

The Members Win This Election

Democracy works when losers recognize the results.  The next step if you believe your point of view and the election was somehow flawed is straight forward.

The corrective if one believes an outcome is not in their interest, is to practice more democracy.   Get back to your feet and ready to run the race again.

The annual election of directors is a critical process that transforms members into owners.  It is a “habit to be practiced” if credit unions are to fulfill their unique role in America’s financial system.

In a political or financial democracy, contested elections are the foundation for all our freedoms.  Both winning and losing parties must support the outcome-period, as Blaine affirms.  Then everyone wins.

 

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We Show People the Difference

This blog series uses video excerpts of credit union leaders’ wisdom, some retired, some still active. (best seen in browser mode)

They still speak to our present circumstances as their core messages are timeless.

These two videos go to the heart of what makes Wright-Patt, Dayton, Ohio a leading credit union.

The first is a one minute video by former CEO Doug Fecher on how credit unions succeed:  “We show members the difference.  We listen to them and act in their interest.”

(https://www.youtube.com/watch?v=MYWkI0eY8Z0)

This second video from Wright-Patt CU are members’ stories of how the credit union helped them to buy or to stay in their home.  This was recorded right after the 2009 financial crisis caused many financial institutions to foreclose on home owners.

These examples illustrate the credit union’s goal of “showing the credit union difference” described by CEO Fecher.

(https://www.youtube.com/watch?v=yMJT0nneRaM)

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Puttng a Pulse to Lending

This week’s blogs are video excerpts of wisdom from prior credit union leaders. (best seen in browser mode)

They still speak to our present circumstances as their core messages are timeless.

Grantng credit is the primary function of a cooperative.  In the last 20 years risk based pricing has become the dominate practice for consumer loans.  It appeals to conventional wisdom.  Those who have financial success should not pay the same rate as those who have blemished credit.

However, credit unions were supposed to be a paradigm shift from the free market theory that anyone should have credit available-at the right price.

Jim Blaine, former SECU (NC) CEO, believes the initial credit union lending approach  is core to the cooperative model. Risk based  pricing for loans discriminates against those who most rely on credit unions for a fair deal.

In this three minute video from 2010 he provides his logic. Although retired in 2017, he continues to expand his arguments with recent studies in his blog SECU-Just Asking.

One interpretation of Jim’s approach is in this 2010 GAC interview with Wayne Vann, CEO of NavyArmy Credit Union (now Rally CU).  His two keys: putting a pulse to every loan and the autonomy of lenders to make decisions. (1.14 minutes)

(https://www.youtube.com/watch?v=rSXa3T8iGTY)

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Credit Union’s Reputation In the 2008/09 Financial Crisis

This week’s blogs are video excerpts  from prior credit union events. (best seen in browser mode)

Today’s are brief CNN and CNBC news excerpts recommending credit unions as an option consumers should consider.

This short clips are during the 2010 financial crisis They tell why credit unions might be a better choice.

They highlight the system’s reputation earned during the 2008/2009 financial crisis as a reliable source for loans as banks were forced to draw back.

(https://www.youtube.com/watch?v=H0dNHDsFvuE)

The following CNN excerpt compares credit union and bank average rates as part of  Why Credit Unions are Better.

!https://www.youtube.com/watch?v=I_CaoDPGl7Y)

Credit unions described as an unusual source for home loans during the financial crisis.

(https://youtu.be/EwbLgsyWcjI)

What would the news report about credit unions today?

 

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Different by Design and CUSO’s

This blog series uses video excerpts with wisdom from prior credit union leaders. (best read in browser mode)

They still speak to our present circumstances as their core messages are timeless.  Both excerpts were in response to the regulatory “backlash” in response to the 2008-2009 financial crisis.

The first video is a very brief excerpt from Jim Blaine, CEO of SECU (NC) in 2010 reacting to the prospect of  increased regulation prompted by the financial crisis (37 seconds).  His view is then referenced in the second video.

(https://www.youtube.com/watch?v=E1tnDcE6Xjo)

In 2010 Dave Serlo PSCU President analyzes credit union performance during th 2009 financial crisis in a talk called Different by Design.  The context was PSCU’s annual users’ meeting.

In this 14-minute presentation he cites Jim Blaine’s remarks on regulation.  Most importantly he outlines opportunities for credit unions and the “credit union promise.”  He closes with four priorities for the CUSO.  Now is the time to be on offense, especially for expanded lending.

Dave was a remarkable speaker using no notes or other prompts.  Most importantly is his deep insight into the power and importance of the credit union model and CUSO collaboration.   His final words still resonate:  Carpe Diem, seize the promise of this day.

(https://www.youtube.com/watch?v=6uS7Zl3lROE)

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“If We Went Away. . .?”

This blog series uses video excerpts with bits of wisdom from prior credit union leaders.   (best read in browser mode)

I believe they still speak to our present circumstances.  For the core of these observations are timeless.

Doug Fecher (now retired) CEO of Wright-Patt Credit Union, Dayton, Ohio speaks to the ultimate mission of the cooperative.  (just over 1 minute)

(https://www.youtube.com/watch?v=tE_3-ipOiPE)

Later in the series, there will be an example of how the credit union implements his vision.

 

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This Child Here

Readers may be aware of my interest in and support for Ukraine in their fight for freedom.  Occasionally I write posts about events in this country under daily attack by Russia.

There are many opportunities to support Ukraine from direct donations to organizations in-country to funding students and persons living in the US and other countries of refuge.

I just learned about another long-standing organization called This Child Here founded by a Presbyterian minister in 2006.  The leader is Robert Gamble who tells of his initial work with homeless youths in the disrupted society following the country’s independence.  This effort came in mid career, after serving five years in the Coast Guard and then attending Princeton Theological Seminary to enter the ministry.  He has served as pastor for five churches throughout the denomination.

He writes in 2007 of his initial experience working with an NGO in Ukraine to help homeless youth:

You don’t have foster families in Ukraine. No one can afford another child. “You have three children,”a taxi driver said to me, “you must be a rich man.” 

While I am here there are times I drink too much but most times too little. I spend like a poor man but live a life that is rich. I listen to idiots, skeptics, learned people and fools, I learn from the suffering of children. I doubt and trust, give away and receive. I get robbed and restored, applauded and shunned. 

I see churches void of life and attended worship with more life than my comfort zones can handle. I gave one sermon; it wasn’t in a pulpit , and I didn’t wear a robe . I stood on a rented stage in an old movie auditorium and it hardly lasted seven minutes, but I felt alive and honored as every word I spoke was repeated in Russian.

Today’s Work

Gamble’s work leading the organization now alternates between three months on the ground in Ukraine followed by three months of travel throughout the US fund raising for his 501 C 3.  His current itinerary shows 98 stops with churches, local groups such as Rotary and “friends” on his September 7 to November 17 return.

His group’s  purpose today:

We work with families displaced by the war. Thousands of people have fled cities in the east and arrived in Izmail, Ukraine in the west. As many fathers are in the military or still residing in places now dangerous, these families often consist of mothers and children.

We provide products from grocery stores, and centres for youth and children’s activities, including sports, music, art, and programs led by psychologists. Through these activities, summer camps, and the supportive community we have built, we offer therapy for the trauma and shock suffered by these families.  This Child Here, Inc. is a Validated Ministry in the Presbyterian Church (USA).  

The work is not without danger as recorded in this brief 2003 video.

His Belief:  People Change People

When this war is over, people will read about what was done, not just between armies, but behind the lines where people help people and people change people, for the better.

This is an American who for two decades has invested his energy, mind and purpose with the belief that people changing people  will make the difference in the future of Ukraine.  And I believe in other societies as well, including ours.

As I learn more, I will share this person’s journey of a committed life.