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Glatt Leading online CU challenging exciting
BALTIMORE (8/4/10)--Leading the nation’s first online-only credit union is a lot like “being the parent of a first child,” according to Tom Glatt. “They don’t come with instruction manuals.” Glatt, who stepped down Sunday from his post as CEO of the online-only REALTORS FCU, told News Now that his experience with REALTORS was great, though sometimes challenging. “We set up something that’s never been done before,” Glatt added. “But we don’t do anything at REALTORS that isn’t done at another credit union. Every day is a new adventure. It’s very exciting, and very challenging.” Glatt, who became REALTORS’ first CEO in 2008, said he’s leaving because he has accomplished his goal--to get the credit union off the ground and operating. As the credit union changes its growth strategy, Glatt is moving on to the next chapter in his credit union career. He’s looking for other CEO jobs, hoping to relocate closer to his wife, who is in New Jersey. Jane Pannier, REALTORS FCU executive vice president and general counsel, is acting CEO. Glatt previously was CEO of Continental FCU, Tempe, Ariz. He and his wife also founded a consulting business, Counter Intelligence Associates. REALTORS FCU serves members of the National Association of Realtors (NAR), which has 1.2 million members. Although REALTORS received its charter in 2008, the idea for the credit union has been around for nearly a decade. Today, the credit union has 5,500 members and $80 million in assets--less than the 25,000 members and $110 million in assets predicted. Though the credit union is close to its asset goal, its growth has been dependent on the economy. “In times of uncertainty, people stick with what they have, whether they like it or not, because of fear of the unknown,” Glatt said. When the economy improves, there will be an explosion of growth, he added. Two of REALTORS’ biggest challenges were security and awareness. Unlike a traditional credit union, “we never look members in the face. So whatever security the credit union had to go through with someone to open an account, it did. We triple checked everything,” Glatt said. Though NAR does a “fantastic” job marketing to members, some still don’t realize that NAR has a credit union, Glatt said. The credit union is working to heighten awareness. Potential members’ acceptance of the virtual model also is challenging. Call center staff still receive questions about where the branches are located. “We told realtors that we understand the value of the local relationship, but that’s just not our model,” Glatt said. “We’re telling folks to give us a chance, and through the virtual model, we’ll try to get as much of their business as possible.” The positives of an online credit union are huge, especially for younger people who are less concerned about the social aspect of banking. An online-only credit union offers convenience. “If you want to join at 3 a.m., you can do that,” he said. Members can open accounts, fund accounts, and apply for loans online. “If you want to make a deposit at 3 a.m., you could go to an ATM ... but at REALTORS, you can take a picture of the front and back of the check [or use a scanner], send it to us, and [the money] is in your account.” Glatt said he expects to see more online credit unions in the future. He received several calls from CEOs asking how the credit union created its virtual model. A virtual model can especially benefit credit unions with national fields of membership, because it may be hard to serve members in areas of the country where the headquarters is not located, he added. Existing credit unions seeking to move to a virtual model should create a separate entity to transition members, Glatt suggested. He likened the process to the change several decades ago to self-service gas pumps from full-service gas pumps. Gas stations slowly introduced self-service pumps while keeping some full-service. They gave customers a price break if they used self-service. Eventually, customers transitioned to the self-service pumps. However, as happened with the gas pumps, some consumers will expect all the services of a traditional credit union branch in a virtual model. That will prove challenging for credit unions, because “we love to take care of our members,” Glatt said. “If they say they want something, we say ‘Okay.’” According to Glatt, if a credit union wants to go virtual, it should:
* Talk to a credit union with a virtual model--like REALTORS. When launching, REALTORS received some help from Pennsylvania State Employees CU, Harrisburg, Pa., which has a virtual model but is a traditionally based credit union. * Do its homework. “Don’t be in a hurry. Fixing stuff on the fly is difficult,” Glatt said. * Be selective with vendors. “You don’t want someone learning the virtual model at your or your members’ expense.”
NAR had a great idea and has a great credit union, said Glatt. “I wish them nothing but success,” he added. “We parted on good terms. They have the right idea and the right model.”


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