Business View Magazine | December 2020

172 BUSINESS VIEW MAGAZINE DECEMBER 2020 Center Credit Union in Cincinnati, Ohio. This was Superior Credit Union’s first foray into a major metropolitan area. It expanded into the greater Cincinnati area following a merger with Classic Federal Credit Union in 2018. That same year, Superior Credit Union moved into the Toledo, Ohio market by merging with Co-Op Toledo Credit Union. In September 2019, asset size reached $1 billion. Superior Credit Union now has about 96,000 members and ranks the fifth largest credit union in Ohio, with total assets about $1.2 billion. But getting to this point wasn’t easy. Credit unions have been facing a number of challenges over the last 40 years. One of the biggest is rate compression. Buell recalls, “Mortgage rates peaked at about 16 percent back in the 1980s. That made it relatively easy to make money. Rates have jumped around a bit, but in the years since, a linear line can be drawn from 16 percent down to nearly zero. So, I guess the first thing I would say is the compression in interest rates over the last 40 years is driving financial institutions to be very lean and, if not, it pushes them out of business.” Increased regulation has also played a role. From the Sarbanes-Oxley Act of 2002 to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the amount of regulations that have been put on financial institutions has only increased costs. And those expenses come without generating any income. The third factor is the continual expectation of new services that also cost money but don’t necessarily generate revenue. At first, it was call-in services that allowed members to transfer money over the telephone. Then it was ATMs and ATM cards. Home banking and mobile banking followed. The latest trend is ITM, or interactive teller machines. “How much have we been able to charge for the new transaction channels? You can’t,” Buell reports. “So with that, we’ve added all these new expenses, and we’ve gained some efficiencies Senior Vice President of Business Development, Kurt Neeper