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Arrowhead CU shuttering four branches
SAN BERNARDINO, Calif. (1/8/09)--Arrowhead CU is reducing its 2009 operating budget by 10% and shuttering four branches to maintain its well-capitalized rating through 2009 and beyond, Arrowhead said. The credit union is closing three branches in grocery stores in Chino Hills, Hemet, and San Jacinto, effective Feb 7. A fourth branch in Murrieta also is closing the same day. ATMs at those locations will remain open. Members in those communities can conduct financial transactions at Arrowhead’s partner credit unions and can access Arrowhead’s online system, said Larry Sharp, Arrowhead President/CEO, in a press release. As a result of the closures, Arrowhead, a $1.032 billion asset, San Bernardino-based credit union, is reducing its 558-person work-force by about 20 positions, Sharp said. The credit union has identified 10 unfilled positions in-house where some employees may be transferred. “The largest foreclosure rate in the country is in that area of San Bernardino and Riverside counties,” Sharp told News Now. “Our credit union was not impacted by the subprime issues, but rather by the downturn in the economy that resulted from the subprime problems. There is 10% unemployment in our area that could reach 12% by year-end. Also, the bankruptcy rate is up 125% now in our area. We don’t know how deep this thing is.” After the closings, Arrowhead will go from 28 to 24 branches, Sharp added. The branch located in a free-standing building will continue to be leased by the credit union until a new tenant is found, Sharp said. Sharp said he is taking a 17% pay cut in a top-to-bottom cost-cutting effort. The credit union also is postponing plans to add new branches and is cutting its budgets for travel, education and community development. “Overall, we are cutting our costs by more than 10% for 2009. These reductions will leave Arrowhead CU strong and well-positioned once the economy turns around so that we can continue to provide outstanding service to our more than 162,000 members,” Sharp said. Sharp, met Tuesday in Washington D.C., with congressional members and NCUA Board to discuss competitive inequities created by the uneven application of the $700 billion Troubled Asset Relief Program (TARP), which has excluded credit unions. Joined by fellow California credit union leaders, Sharp discussed the consequences of providing TARP funding only to banks. “I’m mad that Paulson and the Treasury decided to fund our competitors at the banks and give them an advantage in assistance, and leave us out in the cold in the marketplace,” Sharp told News Now. “We’re going to have to take the hit [for now].” The Credit Union National Association has been working with legislators to include credit unions in the TARP initiative.


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