By Frank J. Diekmann
John Murphy doesn’t want to hear anything about the debate over large and small credit unions and their competing (and often divergent) needs.
It may dominate the talk at other trade associations, but Murphy, the retiring president of the Maine Credit Union League, doesn’t believe it’s really relevant when it comes serving its affiliated credit unions.
“What is a large credit union? If you ask 10 people, you’ll get 10 different answers,” said Murphy. “The real focus is on our not-for-profit, cooperative status, and then to look to what is unique about each credit union. What is its focus? We don’t look at credit unions by asset size, we look at each individually. We are always going to hear the large vs. small argument, but I don’t really care what the ideal asset size is. That’s not for us to decide. It is for us to decide how we can meet the needs of each.”
That approach has paid off in an environment in which many credit unions in other states have anguished internally over whether to renew their league dues. The Maine league has 100% affiliation, not to mention a successful data processing subsidiary; a subsidiary (CUSO Home Lending) that is one of the leading mortgage lenders in the Pine Tree State; a widely supported and effective statewide advertising campaign, and an admirable annual effort to help feed the state’s hungry (with its Campaign for Ending Hunger raising $674,000 in 2016 and more than $7 million since it was created).
Not too bad for a guy who 44 years ago, when he was an 18-year-old taking a year off from college, was told about a job in the print and supply department at something called a “league.” So, he applied, and was hired by former league president Ted Desveaux.
“It was my first job. I had no idea what a credit union was,” Murphy told me in a conference room adjacent to his old office at the Maine league’s headquarters in Westbrook.
'A Good Orientation'
He knows now, thanks to working in nearly every department at the league over his career, including direct mail, payments, government affairs, PR, and MECUL Services Corp., which is now known as Synergent.
“I stayed and grew with the organization,” he said. “It was a good orientation.”
During that career, Murphy has had to learn the advocacy business, which has become increasingly important to trade associations. But Murphy said advocacy, even if it wasn’t always called by that word, has long been a focus of the Maine league.
“Advocacy has always been the foundation of the league,” according to Murphy, who has been president of the Maine league for the past 25 years. “Advocacy has always been the core of what trade associations are about. They are there to promote the industry. I learned on the job. I was always interested in politics to some degree, and a league president is a political position. The backbone of the job is to be politically astute.”
Todd Mason, who has been hired to succeed Murphy as president of the league, agreed, saying much of the work done on the league side in serving the state’s CUs is also applicable to advocacy. “The principles of one help you to understand the other,” said Mason.
Murphy said the league has always had a very good relationship with the state legislature in Augusta. But that’s no accident.
“That doesn’t just happen,” said Murphy. “We have three lobbyists. In the mid-1990s Maine was a real battleground state over taxation and field of membership.”
The state’s CUs at the time found themselves hidden in the shadows of the bankers when it came to lobbying in the capital. “Credit unions in Maine made a commitment that they never want to be in that position again, and that the best defense is a good offense. We have been strong politically ever since,” said Murphy, who was recently honored by the league for his career. You can read more about that here.
Maine's CU's 'Own It'
Maine’s credit unions have also been on the offense with statewide advertising since the 1970s. Those kinds of ad campaigns have been hit or miss in credit unions, with emphasis on the miss. Many are rolled out with all the enthusiasm of the “Got Milk?” ads, but it isn’t long before some CUs are unhappy with the messaging and it’s “Got A Reason to Continue?” So why the support for what is now the “Own It”-themed advertising in Maine?
“We do the market research, and ‘Own it’ resonates,” said Murphy, noting how consumers embrace the concept of having a say in their financial institution. “Our (initial) research showed people loved credit unions, but we did not offer the products and services (they wanted). Here in Maine, we have more (shared) branches (175) than the top three banks combined. What strikes me the most is the popularity of credit unions today. Fintechs only have a piece of it. They do not have the support of a network and people who are local. Credit unions have the technology now, along with the local governance. If you were to make a list of things people like in a financial institution, I can’t imagine that it would add up to anything other than a credit union. Twenty-five years ago, people did not know what a credit union was. That has changed significantly. We are very well-matched with Millennials, and credit unions have never been better positioned. They like locally owned and controlled financial institutions.”
But why do Maine CUs keep agreeing to pay for the advertising when similar campaigns in other states eventually lose support?
“We deliver information and facts to credit unions. We do the research and then we work with credit unions to develop the advertising. It all comes down to results. You can’t just ask for money. Fortunately, credit unions are seeing those results.” (If you want to view the commercials, just go to YouTube and search “Maine Credit Unions Own It.”)
Synergy From Synergent
Unique to Maine, about 80% of the state’s credit unions use its Synergent subsidiary for data processing. Synergent is a reseller of Symitar’s Episys core solution, which Murphy noted is used by more billion-dollar CUs than any other core, but is available to CUs of any asset size.
“It’s a well-respected technology platform in a data center environment,” said Murphy, adding, “If you try to reinvent everything you are going to be a long time in coming to market.”
Murphy said credit unions understand Synergent is a for-profit business and that investments must be made in technology to remain competitive. He said Synergent is seeing new growth from credit unions outside the state.
About half of all Mainers belong to a credit union, and Murphy said he is optimistic about what the future holds for both the league and CUs once he’s gone.
“We still need to define opportunities to compete. We will never be the largest,” he said. “But we must not lose sight of why credit unions exist. They are here for the members and that’s it. Otherwise, they would just be another provider in a very crowded marketplace.”
The focus at the league, he added, is on ensuring the products and services that will be needed 25 years from now are in development.
The new CEO, Todd Mason, who was previously chief strategy officer for RouteOne in Farmington Hills, Mich. and who also spent 19 years with the Michigan Credit Union League, said he, too, is “very positive” about credit unions, and that he understands where the real difference-maker lies.
“I am the technology guy to a certain extent. I spent my career in technology,” he said. “But I have spent the past few weeks being reminded of just how important people are. You can have the best technology, but if it’s not backed up by great people…It’s not about assets or FOM, it’s about the core of what credit unions are all about. I think credit unions get that.”
Get Up Every Day And...
While he said he can’t be “blind” to the consolidation that has taken place among CUs and state CU leagues, Mason said he doesn’t feel “any pressure at all” over the issue. When he was hired, he said the league board charged him with doing four things:
1. Help ensure the sustainability of the Maine Credit Union League.
2. Provide value to members and customers.
3. Focus on performance, security, reliability and service.
4. Drive growth by developing new products and services.
Murphy, who has two grandchildren, said his plans for now are to remain in the state at least for the summer, which he joked in Maine takes place entirely on July 4th. Beyond that, he offered this observation, which makes for good advice for any trade association.
“If you get up every day and just say I want to do the best job I can to help credit unions, that is the mission.”