Previewing the Illinois Credit Union League Convention

The Illinois Credit Union League’s annual convention begins next Thursday at the Chicago Hilton and Towers. Given the turbulence in the financial sector, this year’s aptly named theme is Shake, Rattle and Roll.

While there will be plenty of breakout sessions for management and board members, I expect the biggest topic of conversation this year will follow along one of these three lines:

• The future of the nation’s 28 corporate credit unions
• How NCUA’s special assessment has hurt smaller credit unions
• If mergers and acquisitions are good for natural-person credit unions

The Future of Corporate Credit Unions

The news of U.S. Central and WesCorp shook the credit union industry, but has failed to resonate in the mainstream media. Regardless of its newsworthiness, it is a troubling fact that the NCUA bailed out two of the largest (there are only 28) corporate credit unions.

It is very likely that corporate credit unions will merge over the next few years, leaving American credit unions with a safety net similar to the Federal Reserve’s 12 regional banks.

I will write about this topic at greater length on Monday.

NCUA’s Special Assessment Impact on Small-Cap Credit Unions

You’ve managed your company through a hard year, and can show a profit to members at your annual meeting. Then your national regulatory agency calls and says they plan to levy a special assessment because they need some money to bail out a few people. The assessment is $500,000 beyond your regular, annual assessment. It wipes out any profit you made. It kills your ROA.

Welcome to the reality of many small-cap credit unions across the country.

Are Mergers and Acquisitions a Healthy Thing?

Special assessments, shrinking assets, and healthy competition are driving smaller credit unions to seek mergers with safer, healthier organizations. Is this reality a healthy outcome given credit union’s historical closed-segment membership? Are credit unions merging themselves into little more than non-for-profit banks?

There is a fine line between philosophy and reality. I’d love your thoughts.

Are You Going to the Convention?

Argonne Credit Union CEO Brian Cedergren will lead a delegation of three Directors this year. I plan on attending sessions on Friday and Saturday, and look forward to networking with people during the Chairman’s reception Friday night. Let me know if you plan to attend. Leave a comment below, or send me a private note from the Contact Page.

See you in Chicago!

Here are other articles I have written on this topic:

• Three Must Sees at the ICUL Convention
• The Future of Corporate Credit Unions
• A Brief Explanation of the Credit Union System
• How Your Credit Union is Helping Fix the Credit Crisis
• Argonne Credit Union Board Passes Merger Resolution
• Credit Union Board of Advisors
• ACU in Black for Second Year
• Why You Should Know Your Staff Member’s Hobbies
• Five Ways to Establish Strong Media Relationships
• Twitter Poll: Who Do You Follow?