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Two CUs in Cornerstone Region Receive Excellence in Lending Award
Tuesday, November 5, 2013 6:50 AM

Six credit unions, including two from the Cornerstone region, were recognized for their exemplary lending Monday by receiving an Excellence in Lending Award, sponsored by the CUNA Lending Council and CUNA Mutual Group. Awards were presented at the CUNA Lending Council’s 19th annual conference.

Texas Trust FCU was recognized in the Mortgage Lending, assets more than $250 million category. Texell CU was recognized in two categories:

  • Consumer Lending, assets less than $250 million
  • Low-to-Modest Means

The Excellence in Lending Awards were established by the CUNA Lending Council and CUNA Mutual Group in 2000 to recognize credit unions that have implemented outstanding lending programs while demonstrating sound financial performance. The annual awards provide an opportunity for credit unions to share best practices and ideas, build networks, and recognize and celebrate lending excellence.

For its Excellence in Lending Award, Texas Trust CU was recognized for its efforts to stabilize its mortgage operation. The credit union had a $61 million mortgage portfolio in 2006 that looked sound, but in many cases the average income generated from each loan was less than the cost to originate it. The credit union implemented a number of measures to address the issue, including aligning staff, improving efficiencies and making sure the right people were in positions to meet the challenge.

With more than 50 percent of its production being home equity loans, Texas Trust CU identified market needs and began marketing what turned out to be more than 100 different first and second lien mortgage choices. They utilized a variety of channels, including TV, print, and digital and social media to proactively tell their mortgage story.

Those awareness efforts paid off with member penetration for mortgage lending increasing from two percent to 15 percent.

For its Excellence in Lending Award (Consumer – assets less than $250 million) Texell CU was applauded for its efforts to identify weaknesses in its consumer lending program, and make dramatic improvements.

By developing new products and underwriting procedures, implementing a sales-driven, relationship-building culture and by making a number of operational improvements, Texell CU achieved the highest loan-to-share ratio in its history, including higher average loan balances per member and more members that are borrowers.

At the end of 2007, about 22.9 percent of members were lenders. By the end of 2012, that number increased to more than 51 percent. At the same time, average loan balances increased from $9,249 to $10,736.  Also during that time, Texell CU went from a centralized lending model to a hybrid, which pushed many loan decisions to the branch level.

Texell CU was also recognized for transformed its lending strategy to better serve a predominantly low-income membership base. That transformation has propelled loan performance to the highest in the credit union’s history, including the highest loan-to-share and borrower-to-member ratios in the credit union’s history.

All this was accomplished while keeping delinquency and net charge-offs well below peer and industry averages. This year’s double winner places a high priority on financial literacy and couples that by offering affordable loan products that meet their members’ needs.

Some of those loans included holiday loans, a payday alternative extended, regardless of credit score; loans aimed at members and potential members previously denied loans, and Aspire Credit Card, a partially or fully secured card.

The credit union says its sales and service culture mantra is “treating members fairly and with respect, regardless of their credit affluence.”

According to the credit union, member surveys in 2012 rated that loan satisfaction score of 4.70 on a 5.00 scale and 96 percent of responded would recommend the credit union to others. The credit union says the practice of treating members with respect has built a very loyal membership base.