NEW YORK (7/5/13)--To grow non-interest income in today's economy, credit unions must focus on the areas they can control, with emphasis on building deeper member relationships, a CUNA Mutual Group representative told an America's Credit Union Conference (ACUC) Discovery breakout session Tuesday.
With an influx of new members in the past 18 months, credit unions have a great opportunity to build share of wallet, Bob Larson, financial support consultant for CUNA Mutual Group, said during a Discovery breakout session at America's Credit Union Conference in New York Tuesday. (Photo provided by CUNA Mutual Group)
Bob Larson, financial support consultant for CUNA Mutual Group, discussed strategies for growing non-interest income in a changing environment.
The conference, presented by the Credit Union National Association in New York City, ended Wednesday.
"You will do better in today's economy by focusing on what you can control, not on what you can't control," said Larson. "Start with understanding your current credit union membership as well as those who've just joined your credit union.
"During the past 18 months, credit unions have added a great number of new members," he added. "Credit unions need to make sure they tap into new members by cross-selling additional services: loans, debit cards, credit cards, bill pay, etc. The more services, the deeper the relationship."
To deepen member relationships, credit unions must make sure they have a strong, transparent sales culture focused on building lasting member relationships, he said. The four key components for a successful sales culture are:
Champion--Have top-down management commitment and communication;
Train--Prepare staff to meet member needs with confidence;
Coach--Provide staff with consistent recognition and positive reinforcement to align management and staff behaviors to support credit union goals; and
Track--Inspect quantifiable data for coaching, training and making improvements.
A credit union's sales culture should start and end with the member, Larson said. "Let the member control the process because, as (credit union pioneer) Roy F. Bergengren so eloquently stated, 'the most important service of the credit union is the education of its members in the management and control of their money,' which is exactly what ultimately drives your credit union's sales culture," he added.
Current market conditions have greatly impacted credit unions' earnings. Now, more than ever, credit unions must explore every aspect of their income statement to leverage additional income and to keep their revenue stream flowing. Larson added that members' and credit unions' interests have never been so well-aligned before, so credit unions should take advantage of this by aligning their sales cultures to meet members' needs.
Larson recommended that with the future threat of rising interest rates, credit unions should take time to develop a strategy to move some certificate dollars from the balance sheet to a wealth management program to improve the loan-to-share ratio, which will generate additional non-interest income in gross dealer concessions for the credit union.
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