By Ray Birch
TALLAHASSEE, Fla.—There is too much “isolation” within the credit union movement today, insists one person who has responded by developing a new resource to spur greater collaboration.
“When I first started in the credit union industry, many years ago, there was a lot more collaboration,” said Jim Giacobbe, CEO of United Solutions. “But now every credit union is afraid of the CU next to them. They feel they have the wrong intentions and want to merge them in. So, again, more isolation. We need to reverse that trend.”
Looking to do just that, United Solutions has formed the “Credit Union Rescue Team,” a group it describes as skilled CU executives who are volunteering their time to help other credit union leaders in areas in which they need assistance. Members of the team donate between 30 minutes to an hour per week for 10 weeks to help a credit union in need. Once the 10 weeks are up, it’s up to the credit union and the advisor to decide if they continue to work together, Giacobbe explained.
“United Solutions wants to help credit unions become stronger, more efficient, and profitable,” he said, noting the services of the Rescue Team are typically directed toward smaller credit unions. “With so many credit union CEOs retiring, and new CEOs stepping in, we feel there is a need for a mentoring program.”
Isolated at the Top
Giacobbe explained that often when credit union CEOs start their new job, they may need some help in areas in which they are weak or have not had a great deal of experience.
“But they often feel isolated at the top, and don’t know who to turn to inside the credit union or outside for assistance,” said Giacobbe.
That has led to problems United Solutions has seen over the years in working with credit unions across the country.
“We have seen credit unions keeping too much cash for branch operations, when they could be investing millions and making money. We spoke to a credit union CEO who gave out a 3.25% auto loan to a member with a 419 FICO score and didn’t understand why that was wrong,” said Giacobbe. “We have watched a credit union open a branch in a restricted building where members needed security badges and couldn’t enter the building. We talked with a credit union that converted to a community charter in 2006 and continues to use the name of a now defunct sponsor.”
Not a ‘Money Grab’
Another issue is that assistance offered to small credit unions sometimes becomes a “money grab,” suggested Giacobbe, who stressed the Rescue Team does not
Jim Giacobbe
charge for its services.
“Companies get involved in the small credit union market. They explain how they will help small credit unions and do the right things for them. But, then, it becomes a bit of a money grab. Or, they find out the small credit union does not have the money for their services and they just move upstream. I’ve been working with credit unions for a long time and I have seen this happen. There just is not enough genuine help for smaller credit unions today.”
Giacobbe recognizes the assistance for small CUs provided by NCUA—through its Office of Small Credit Union Initiatives and grants. But not enough is being done, he said.
“Let me emphasize the Credit Union Rescue Team is not just for small credit unions,” said Giacobbe. “I have worked with credit unions of all sizes that need help—maybe they feel they are being held hostage by their networking department that are demanding the credit union spend its limited resources on the latest technology, some CUs don’t understand business intelligence well…So this is not entirely about small credit unions. The team is for anyone who needs help and does not know where else to turn.”
How to Participate
Giacobbe said volunteers are lining up in the early days of the effort.
“We started the Credit Union Rescue Team late last year and I am pleased with the number of credit union experts that are volunteering their time to help others,” said Giacobbe.
Volunteers can sign up by going to: https://www.creditunionrescueteam.com/
CU leaders wishing to provide mentoring services go to the same address.
Areas the Rescue Team covers: accounting and general ledger, collections, lending, IT management, operational efficiencies, growth accelerators, marketing, succession planning, policy and regulation, and staffing.
“When you ask for assistance it’s a completely anonymous request,” emphasized Giacobbe. “We’ll partner together with the executive to do a financial analysis of the credit union and then coordinate a call between the leader and the Rescue Team expert.”
What it All Comes Down To
Giacobbe said what is so often comes down to is providing assistance to a CEO when he or she does not know where to turn for assistance.
“Who is going to help you with investment advice, loan portfolio needs or IT concerns who does not want to get their hands in your pockets?” said Giacobbe. “Who’s going to help that new CEO who has nowhere to turn? That’s why we created the Credit Union Rescue Team, so small credit union leaders, and leaders from all asset-size CUs, have an option. This is about credit unions helping credit unions. And we need more of this.”