CUES Podcast 90: Safety and Service Foremost in F&A FCU’s Proactive Pandemic Response—An Interview With Tim Green

04/14/20 • 32 min

When Tim Green first heard—back in January—the news about the spread of COVID-19 overseas, he decided to lead his credit union to prepare for a scenario in which the disease would shut down the whole county where his credit union is located.

He says he thought at the time that if the situation turned out to be less dire, his team would still benefit from the exercise. When Los Angeles County, California, did in fact close down, Tim and his team at $1.8 billion F&A Federal Credit Union in Monterey Park were more ready than most businesses.

Having antennae out to market signals and being open to responding to them is a hallmark of great leadership. And yet Green is most humble in this show. CEO for just about 13 months, he is grateful to his board for their support of this initiative. He’s grateful to other financial institutions for the ideas he “stole” from them and adapted to best suit his credit union.

Green explains in the show that one of the first things he started working on when he joined the credit union was operational readiness—determining what was effective and what wasn’t in terms of people, systems and processes. A key thing he found was that “we were very adept at disaster recovery, but what also became pretty apparent was that our business continuity planning was not where we wanted it to be.”

In January, when the focus narrowed to preparing for the closure scenario, “we really went through it in a sequential way. We ordered a bunch of equipment. ... The processes were tested. We tested in our training environment, then we moved people remotely. By the time we got to the first week in March, we were really ready to handle this and operate 90% of the core credit union functions remotely.

“Once we had operational readiness,” he continues, “... the first thing we needed to do was think, ‘How are we doing to take care of our members?’” Among other programs, the CU offers members financially affected by COVID-19 enhanced skip-a-pay and a short-term assistance loan.

A third leg of the stool was employees. “We were able to move about 75% of our back-office staff out of the building (the CU has two branches) and about 70%” of all staff, he explains. “We gave everybody on the team below vice president a free week of PTO ... and immediately the goodwill started to flow back from our employees."
The CU closed its headquarters branch to walk-in traffic to better protect staff. The other branch has a bandit barrier between staff and members. The credit union also is paying branch workers a short-term 30% raise and catering lunch daily, so staff don’t have to leave the building to pick up food.

“Because we were ready to serve operationally, we were then able to really reach out and provide tangible benefit to our membership, simultaneously demonstrating a commitment to our employees that had carried us through thus far.”

The show also gets into:

How Green’s risk management background informed his credit union’s response
The thing that has worked best for F&A FCU in its pandemic response
How F&A FCU’s response reflected its values--what its leadership thought was the right thing to do
What F&A FCU might do next in its pandemic response effort
Green’s concerns about the economic recovery and helping members through that

The show also gets into:

How Green’s risk management background informed his credit union’s response
The thing that has worked best for F&A FCU in its pandemic response
How F&A FCU’s response reflected its values--what its leadership thought was the right thing to do
What F&A FCU might do next in its pandemic response effort
Green’s concerns about the economic recovery and helping members through that

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undefined - CUES Podcast 89: The Many Benefits of Using Charitable Donation Accounts to Support ‘Cause Marketing’—An Interview With Bruce Bauer and Nick Coleman

CUES Podcast 89: The Many Benefits of Using Charitable Donation Accounts to Support ‘Cause Marketing’—An Interview With Bruce Bauer and Nick Coleman

Early on in this show, Nick Coleman explains why he’s passionate about his work as the director of strategic relationships for Children’s Miracle Network Hospitals. He also describes the longtime support credit unions have offered CMNH. While those stories alone are compelling enough reasons to listen to this show, this episode of the CUES Podcast also goes on to talk very practically “cause marketing” and how charitable donation accounts can support it.

Coleman defines “cause marketing” as the way an organization directs its marketing efforts both to ramp up and to highlight the good it’s doing in its community. As an example, he tells a story about a credit union in the Midwest that’s rallying youth hockey players in its community to do fundraising to support kids with disabilities and complex medical needs.

Cause marketing “is a great strategy to build affinity with both members and employees,” Coleman says. “Plus, it showcases to non-members and your community the value that a credit union brings.” He cites a figure that 79% of consumers expect an organization they do business with to actively strive to do more to support their local communities. In addition, he says, 74% of people say their job is more fulfilling when they are provided an opportunity to make a positive impact.

In this episode, Bruce Bauer, executive benefits specialist from CUESolutions provider CUNA Mutual Group, describes his participation in an advisory committee meeting for Credit Unions for Kids, a credit union industry organization that supports Children’s Miracle Network Hospitals. He presented to that group’s Orange County, California, chapter about how charitable donation accounts could be used by each of the participating credit unions to possibly add additional donations to their efforts.

More specifically, Bauer told the advisory group, and explains in the show, the National Credit Union Administration allows credit unions to expand their investment opportunities to help their charitable giving when they use charitable donation accounts as the vehicle. CUs can invest up to 5% of their net worth into a wide range of investments that are permissible with a CDA.

“When they do that investment and they get earnings from that investment, 51% of those earnings, of that total return, have to go back into a 501(c)3 charity,” Bauer says. “That’s where CUs for Kids falls into place. The remaining 49% of that investment’s earnings can stay right with the credit union.

“We’ve seen enormous growth with this opportunity—about 127% growth in the last year in investments into CDAs. Interestingly enough ... more than half the contributions of those earnings from CDAs we have out there go to CUs for Kids. ... So if we can find a way to enhance their investment portfolio to earn some additional dollars through this regulation it’s going to provide additional dollars that CUs for Kids and other charitable organizations can benefit from.”

The show also gets into:

What credit unions are eligible to do CDAs (all federal credit unions and state-chartered organizations; some need approval from the state)
The kinds of investments credit unions can use with a CDA
Some examples of how CDAs have been used by credit unions
The impact of current market volatility due to coronavirus on CDAs
How supporting 501(c)3 organizations will be increasingly important as the world tries to find a new normal in the wake of the COVID-19 pandemic
Tips for doing cause marketing

Next Episode

CUES Podcast 91: The Role Of Marketing During the Crisis and Beyond—an Interview With Amy Herbig

When people think about marketing departments, they often think about a group of people that create ads and brochures. But, according to Amy Herbig, the marketing department is, at its core, the “key communicator” for a credit union. And that is a very central and very important role as credit unions respond to the COVID-19 pandemic.

“Everything that is going on right now is being channeled through marketing,” says Herbig, CEO of The BA Group, Northfield, Minnesota, in the show. While every role at the credit union is especially busy right now, “marketing is the catalyst for all that information to be disseminated to the member and to the community at large.”

What’s the key message marketers need to be promoting to the credit union’s stakeholders at present? “We are still a strong, solid financial institution.”

Marketers are also becoming de facto public relations reps, Herbig says, as they manage all of a credit union’s communications channels—from email to social media to the website.

Marketing is always important but it’s currently more critical than ever she says, as it takes care to ensure your information is perceived correctly and to manage any misinformation that is presented to your audience.

Most marketing plans and budgets were approved in December 2019 or January 2020. Then marketing had “two good months of really starting to get off the ground” before everything came to a halt due to the pandemic, Herbig says.

Rather than following their original plan, marketers are “having to now act more on the fly,” she explains. “A good marketer is more proactive than reactive but ready to be reactive when called upon. Currently we’re in a constant state of reactive.”

Indeed, she says that whatever was planned for the marketing focus for a particular month may have to change based on the new landscape. Herbig cites the example of a $210 million credit union that’s managing $7 million coming in from federal stimulus checks. How will that impact its upcoming audit? How will that affect its lending?

A credit union’s top marketers need to be brought into the high-level meetings that consider all of these kinds of issues so they are best positioned to get appropriate messages out to members and the community, Herbig emphasizes.

The show also gets into:

Considerations for copyrighting during this uncertain time
The importance of making sure the credit union is prepared to deliver on any messages put out to members or the community
Examples of what credit unions are currently doing to reach out to members
The current effectiveness of the CU philosophy “people helping people”