New growth shoots from credit unions after last year’s pruning

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To the dismay of some, surprisingly, we reported earlier this year the overall decline in the number of branches of credit unions in the United States. It’s been a strange week or so with some credit union executives questioning the data we pulled directly from the NCUA. Despite the anti-dataers (?), The point is that credit unions suffered a net loss of 100 branches in 2020. And honestly, that sounds OK.

To get started, let’s take a closer look at the numbers. At the end of last year, credit unions had a total of 21,215 branches in all 50 U.S. states and territories. That is 449 agencies less than in 2019.

If you look at all of the states and territories, 35 of those reported branch numbers have deteriorated, while 13 have shown increases and six have not changed at all.

The largest drop in credit union branches occurred in the Pacific region (Washington, Oregon, and California) with a loss of 91. While each region reported branch losses, the eight-state mountain region (Montana in the north, to Arizona and New Mexico in the south) saw a decline of only 15 branches.

At first glance, this sounds like bad news or maybe just worrying news. But, with the reduction comes new growth and new possibilities.

It’s like pruning a tree or that weird bush you have in your backyard. From time to time, it must be pruned to let it grow.

Lately, the number of new branch openings, new branch constructions, membership scope expansions, bank branch acquisitions and credit union mergers has been an impressive pipeline of, what appears to be, real and significant growth.

When new fresh smelling credit union branch numbers came out in June, we found that about 160 credit unions were announcing new branches or planning new branches. These numbers have completely turned the tide for credit unions in 2020.

At the end of March, we saw the number of credit union branches start to grow again with a total of 21,550.

From 2017 to 2019, credit unions added 182 branches. Was 2020 just a fluke of the pandemic when it comes to branch cutbacks?

Looking at the data and talking to some of the credit union executives, it looks like 2020 was more of a time of reassessing the credit union footprint. Do we need all of these branches? Are we in the right places? Where is the real need in our communities?

Lately, large, medium and small credit unions have made much of the announcement of new branches and expanded service areas. Officials at the $ 6.7 billion Wright-Patt Credit Union announced its new expansion in the Columbus, Ohio area with a new, big “membership center.” According to Wright-Patt, this will be the largest of its 36 branches.

In Louisiana, Campus Federal Credit Union has unveiled plans to begin construction of a new two-story branch that occupies a massive 27,519 square foot footprint on a nearly 2.5-acre site that the credit union has purchased. Last year. According to reports, 50 employees will work at the new site to take care of its mortgage and commercial lending operations. Impressive.

A few weeks ago, the Lake Michigan Credit Union opened its new 3,100 square foot full-service branch in Ada, Michigan.

In Portland, Ore., The $ 8.4 billion community credit union OnPoint is opening four new branches in four locations of a local grocery chain and plans to do so. open four more in other locations of the same grocery chain in the coming months. .

Just a little further north, the Washington State Employee Credit Union, based in Olympia, Wash., Plans to open its fourth location in Spokane, while renovating two other branches to cater for needs of its members.

Drive across to Chattanooga, Tennessee, and you’ll find the $ 2.1 billion Tennessee Valley Federal Credit Union has opened two new branches in the city.

The list of new and renovated credit union branches that are open or in the process of being opened is currently at a potential record level of activity.

But why?

Even though the pandemic has uncovered a huge demand for digital banking services, members seem to want it all – both in person and in service I don’t need to come to your branch for anything. And the credit unions as a whole seem to give members what they want – everything!

Good for you and good for the credit union system.

Personally, I have not set foot in the branches of my caisse for three years. And that suits me very well. The real need for branches could be summed up in the same need / convenience that McDonald’s brings to many people.

You know, when you take a long drive for hundreds of miles, you see a sign for the golden arches and you’re like, “Oh, well… the company still exists! Even if you don’t eat there, it’s somewhat comforting to know that it’s there for you when or if you need it, if not just for a bathroom break.

Credit unions seem to be doing an incredible job of growing since the size days of 2020. You provide better digital and mobile banking experiences. You improve your game by increasing the capabilities of your branches to better adapt and meet the needs of this important community that you are dedicated to serving.

And that dedication paid off. For a final example, I want to highlight the vision and direction of the $ 3.1 billion Numerica Credit Union in Spokane, Wash.

As Numerica, like so many others, undergoes branch renovations, officials are seeing growth as a result of meeting member needs by merging branch service and digital banking.

According to local reports, digital member transactions account for nearly 85% of all credit union transactions. That’s an incredibly huge number and as a result, this digital demand has translated into an increase in its workforce of almost 600 people – in the last seven months alone!

According to Numerica and some new member survey results, it found a direct correlation between on-premises and digital, with members of the digital bank expressing the “strongest affection for being able to access in-branch banking services when needed.”

It has also reported an 80% return of member transactions at its branches since the tsunami of branch closures that occurred in 2020 during the pandemic.

Has Numerica cracked the code to meet members’ digital banking needs while expanding the branch footprint?

The past year has given us a lot to look at and critically analyze. Watching the results of the 2020 size season and what came of it is truly impressive. This has resulted in deeper roots for a more colorful, healthier future for most credit unions.

Michael ogden

Michael Ogden is editor-in-chief of CU Times. He can be contacted at [email protected]

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