Summary
Some CUs have reacted to shrinking margin challenges by merging with their competitors. Others have looked toward community charters. To compete directly with the big boys, it would seem that you have to offer what they offer. The tax advantages of being a credit union will only take you so far when you consider the resources of a large bank. Financial industry consultant Denise Wymore believes, instead, that credit unions should consider paring down their offerings to their core competencies. She uses the McDonald's approach to help credit unions discover what they are good at and should consider developing a niche in. One credit union Wymore has worked with, $879 million Educators Credit Union, with 83,000 members, Racine WI, has revolutionized the way it markets used car loans -- and has become a force in the local community.
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Extract
Burgers, Fries and Shakes
How is your credit union responding to shrinking margins? How are you dealing with limited fields of membership and the potential disappearance of sponsor companies?
Some CUs have reacted to these challenges by merging with their competitors. It does provide additional security and buying power for the institutions involved, but as a pattern, it makes financial industry consultant and muse Denise Wymore, Seattle, a little leery, "What happens after everyone merges?" she asks. "Then there's nowhere else for us to go, and we still have the same problem."Others have looked toward community charters. George Hofheimer, CAE, director of research at the Filene Research Institute (www.filene.org), Madison, Wis., says ...See the full content of this document
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