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Anticipated Trends for Financial Organizations in 2010
By Rod Staatz
While no one has a crystal ball to know exactly what is coming in the future, there are some trends we confidently anticipate will impact the financial industry in 2010.
For example, we anticipate continued regulatory activity to impact the way that the financial industry does business. In 2009, legislators and federal regulatory agencies began to focus on consumer protection initiatives, and we expect that attention to continue. Those efforts in 2009 resulted in revisions to existing regulations and creation of new legislation, the impact of which is still rolling out. And, of course, there is the potential for additional new legislation to be introduced this year. These regulatory actions aim to protect consumers from abusive credit card, overdraft and other practices characteristic of some financial institutions.
Fortunately for people who do business with credit unions, they will be impacted minimally by these regulatory changes because credit unions have not engaged in the types of practices that the government is now working to eliminate. We have always followed and will continue to follow strict underwriting guidelines to be sure that our credit card and other consumers do not get put into financial situations they cannot manage. Credit unions have also stayed away from exotic products such as subprime loans. Our goal is to help people achieve their financial goals and dreams, which puts the onus on us to be a responsible financial partner.
In addition to legislation, we anticipate continued vigilance in mortgage and other lending. The most optimistic economic predictions suggest that the housing industry will see slow growth in 2010, then move closer to recovery in 2011 and beyond. Credit unions will continue to respond to that trend with sound lending decisions accompanied by our pledge to make loans at a time when many financial institutions are turning away that business.
For example, we realize that many small businesses are being overlooked by bigger banks today. Credit unions like SECU are changing that situation by offering specialized service, making credit available on good risks and focusing on meeting needs. Growing small business is smart for the local community and the global economy, and we can help.
Of course, individual consumer lending is important as well. Credit unions will continue to look for healthy, sound ways to support people who want and need loans. For example, we are working to meet the needs of first time home buyers by spending the time to educate them on their mortgage choices, ensure they understand the process and offer a product that is right for them. In addition to first time mortgages, SECU still offers other mortgages and home equity loans, auto loans, business loans and credit cards. Sound lending is important to the recovery of our economy.
As for deposits, we anticipate that the public will still be in savings mode, and interest rates will continue to stay low until borrowing demand increases.
Many Americans are impacted negatively by furlough, administrative leave and lay-off. In 2010, they can count on credit unions to continue to work with them in partnership to help through the difficult times. People in this situation who do business with credit unions should open a dialogue to ensure they are getting the support they need and deserve.
Because we recognize the challenges people faced during the recession and now through the recovery, credit unions like SECU remain committed to financial education as a means to improve consumers' situations. We offer credit and debt counseling service, as well as workshops on home buying, credit, financial goal setting, identify theft, budgeting, financial aid and more. Our commitment remains to educate people to enhance their financial well being.
Credit unions recognize that 2010 might not be an easy year for consumers, and our prediction for 2010 is that more and more people will recognize the unique benefits that come from doing business with a credit union. We put consumers' needs first, and are confidently moving banking in a different direction.
Rod Staatz has been President and CEO of SECU since 2003. His roots in the financial services industry run deep, with more than 33 years of financial experience, 14 of which have been in executive leadership. Rod has held various executive banking positions in Colorado, Washington State, California and Maryland.
Working in both the banking and credit union worlds has given Rod a unique appreciation for the advantages of credit unions. He is dedicated to the credit union philosophy and takes every opportunity to participate actively in community events that directly support that philosophy.
Rod also sits on several professional Boards, including Card Services for Credit Unions (CSCU), Credit Union Auto Lending Network (CUALN), Credit Union Business Capital (CUBC), Open Technology Solutions (OTS), the Maryland/DC Credit Union Association (MDDCCUA), Credit Union National Association (CUNA) and Credit Union Miracle Day. He was Vice-Chair of the CUNA Growth Task Force in 2008 and the Chairman of the Large Credit Union Roundtable for 2008-2009.
Rod lives in Columbia, Maryland with his wife Chris, who shares his commitment to community service. They have two grown children.
