The next visionary joining us on CU Crossroads- 5 Question Series was Brad Warner, President & CEO of Patriot Federal Credit Union. The topic of discussion with him was ‘CU Management’s Look to the Future’. He started with sharing how before pandemic 2020 looked to be a promising year for Patriot and suddenly how post pandemic things changed for the credit union. He stressed on how Patriot’s management went back to thinking about the purpose of their existence and realized that they are servant leaders and ‘convenience, care and relevant products’ are their drivers. Below are the takeaways from his interview:
- The economic conditions in 2020 have been the most rapidly-changing and volatile that credit union leaders have seen in their entire careers. Credit unions need to strategically align the business unit’s processes and go back to focus on member needs.
- Auto lending is an area of the portfolio that has witnessed volatility and been impacted by unusual and unexpected market forces. At Patriot, auto loan demand is returning after a steep fall-off, and delinquencies remain low.
- Auto lending is an important piece of a credit union’s portfolio, but credit unions should cultivate diverse revenue streams. When it comes to potential major changes in the auto industry, such as driverless cars, Brad prefers a quote from Bill Gates, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.”
- In Brad’s view, the larger a credit union grows, the less it should rely on fee income. It will make it difficult to continue to grow and by embraced by a wide audience. Patriot looks for new types of interchange income that aren’t penal.
- Not planning is planning to fail. Every credit union should have a strategic plan that describes in detail how the credit union will move from its current position to where it wants to be. Then, the processes and people must be in place to effectively implement the plan.