Play to Win: How Social Capital strengthens Credit Union Performance

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Play to Win:
How Social Capital strengthens
Credit Union Performance
Tony C. Budet, President/CEO
University Federal Credit Union, Austin, TX
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The World Bank:
Social capital refers to the institutions, relationships,
and norms that shape the quality and quantity of a
society's social interactions. Increasing evidence
shows that social cohesion is critical for societies to
prosper economically and for development to be
sustainable. Social capital is not just the sum of the
institutions which underpin a society – it is the glue
that holds them together.
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Social Capital =
Equity Stake in the
Greater Good of our
communities
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General Information
• Established 1936 by
UT-Austin faculty/staff
• Today, serves 10
universities & 200+ SEGs
• 100% committed to SEG-based FOM
• No indirect auto lending
• Substantial Real Estate, Insurance, & Wealth Mgmt. ops.
• $1.8B in assets
• 175,000 members
• 500+ employees, 20 service centers
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Community Partners
Relationships
are all there is.
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Financial vs. Social Capital
Dec. 2013 Capital @ all CUs: 10+%
CUs in Austin
CUs in Austin
CUs in Austin
CUs in Austin
CUs in Austin
CUs in Austin
CUs in Austin
Stellar… A+
serving on Chamber board/committees?
interacting with City Council?
interacting with Austin Community College board?
interacting with County Commissioners?
serving on transportation planning boards?
independently meeting with legislators?
interacting with various school boards?
Very Few… Austin CU Social Capital: Grade of F
Bankers are present & active in all these venues!
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Relationships drive Influence!
We want influence, recognize we don’t have it,
so we outsource it…
We buy it by paying our League & CUNA dues.
Then, we complain, are critical when we don’t
get what we want!
Are we the problem?
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CUNA’s Plan to Win
“Generally speaking, we are a movement comprised of
directors and CEOs very comfortable operating in the
regulatory world, addressing NCUA and CFPB challenges,
keenly focused on our ROAs and levels of financial capital.
While those things are certainly important, we would prefer
directors and CEOs instead focus on building relational
capital in DC, in our state capitals, and in communities
served, delegating to others more routine operational
matters. The influence we seek through the Plan to Win is
driven primarily through strength of relationships and,
generally speaking, our movement is relationally weak.”
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President/CEO Position
Serves as an externally-focused, strategically and
politically-minded executive
 Supports the cooperative’s vision, mission, and
corporate values;
 Positions the organization as a corporate role model;
 Secures representation on boards of directors or key
committees of influential trade, political, and/or
community organizations intent on ensuring viability of
the credit union movement and vitality of our region’s
economy and quality of life.
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President/CEO Position
 Actively partners with the League & CUNA at federal and state levels;
 Regularly contacts, personally visits, and seeks influential relationships
with members of Congress and State legislators;
 Champions contributions of corporate funds and may choose to
personally contribute 1% or more of personal compensation to CU PACs
or League/CUNA political activities;
 Actively facilitates Board and staff participation in political and community
affairs, including sustained PAC contributions, participation in Project Zip
Code, and use of other effective tactical tools;
 Regularly communicates to members partisan efforts by the League &
CUNA to elect candidates supportive of critical CU issues, encouraging
members to consider voting accordingly;
 Hosts legislators and credit union-endorsed candidates in credit union
facilities, as appropriate.
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Director Position Description
Directors serve as ambassadors within the community-atlarge, clearly communicating the value of credit union
membership within the workplace, in federal and state
legislative settings, and through civic and other
organizations to which Board members provide leadership.
Directors bring social and political capital to the
cooperative, enhancing its reputation and capacity.
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Greater Austin Chamber of Commerce: Programs to Grow Your Business and Our Economy
Value add:
Breakfast, lunch, and
dinner with a cross-section
of Austin leaders over the
course of 3 days
2013 InterCity Visit: Boston, MA
September 15-17
Join business & community leaders for the Austin Chamber's 10th Annual InterCity Visit.
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CREDIT WHERE
IT’S DUE
Peter and Edith O’Donnell, two
of UT’s most generous donors,
are recognized — at last.
EARLY INNOVATION
Freshmen excel when they’re
given valuable lab experience
INSPIRING YOUNG WOMEN
Program helps them develop
skills they need to succeed
STRONGER FOOTING
Sales of official UT boots
give students a leg up
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Distinct roles for:
CUNA
Credit Union Leagues
Credit Unions
AWOL?
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CUNA MAP Project
Goals:
Remove fear from
advocacy.
ID successful logistics.
The perfect email!
35,000 members/CU;
5 tests over 4 weeks;
By sender, subject,
message, frequency
and tone.
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80% of PFIs:
“OK to contact me for
advocacy.”
More is more… 3-4
emails in 3-4 weeks;
From CEO most effective;
Short urgent subject;
Anti-bank message;
Lots of links/videos;
Direct, sincere, simple
tone;
Cooperative-oriented
language.
Plug and play.
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Keepin’ Austin Weird
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Central Texas Sees Economic Vitality & Diversity in 2014
UFCU has invested
$320,000 in Opportunity
Austin over the last 10
years and just committed
another $185,000 over
the next 5 years.
______________________
UFCU, not a bank, holds
the mortgage on the
Austin Chamber’s facility.
Through the work of Opportunity Austin, 2014 has gotten off to a successful start. Thanks
to your supporter as an OA Investor, many companies are expanding in the Austin
area, bringing with them jobs for families and economic prosperity.
2014 Expansions & Relocations
Company
Jobs
Location
athenahealth
607
Downtown Austin
NASDAQ
30
West Sixth St, Austin
Websense
470
Northwest Austin
Epicor
75
Northwest Austin
Atlassian
300
Downtown Austin
Parsley Energy
100
Downtown Austin
Ottobock
110
The Domain, Austin
Dropbox
170
Downtown Austin
Roku
50
The Arboretum, Austin
HID Global
50
Tech Ridge, Austin
For more information on this news and other Opportunity Austin specific endeavors
please visit our Investor's Report page here.
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Recent Investments in
Communities Served
•
•
•
•
•
•
•
•
•
•
•
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$16.2 mil. over 20 years – UFCU Disch-Falk Field (UT Baseball)
$1.3 mil. St. Edward’s University Alumni Gym Renovation
$500,000 UT Libraries
$500,000 Opportunity Austin
$300,000 Concordia University Nursing Program
$250,000 St. Edward’s University Science Building
$200,000 “I Live Here I Give Here” Lead Sponsorship
$150,000 to UT Child Care Center
$ 50,000 to UT School of Nursing
$ 36,000 annually – Neighborhood Longhorns
$ 35,000 annually – UTMB scholarships & academics
More to scholarships and community programs
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Evidence of Strong Growth
In the last two years:
• Key relationships continue to grow.
• Added 30,665 (net) new members (+22%)
• Deposits up 14% (despite strong efforts to slow)
• # of accounts up 36% (debit interchange revenue
experienced corresponding growth)
• Loan originations up 47% (w/no indirect lending)
• 2013 ROA .79%
• 2013 ROE 10.57%
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Conclusions
• Aim higher! Return to our roots as a “movement.”
• Slabs, financial or otherwise, are ugly. Build something
beautiful on your slab!
• Face outward, get involved. Start small and scale up as
resources permit.
• Serve like a Credit “Unioner,” but lead like a Banker.
• See the world through the lens of abundance.
• Be relevant!
• Give social capital as much attention as financial capital.
• Have a voice in your community, state capitol, Washington, DC.
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Contact Information
Tony C. Budet, President/CEO
University Federal Credit Union
P O Box 9350
Austin, TX 78766
[email protected]
512-467-8080 X21008