By MATT WRYE
THE ALLURE of huge profits doesn't stand a chance here.
Rising stock prices? Skyrocketing revenue projections?
Don't even think about it.
A credit union isn't your average financial institution, and neither are the leaders who run the Rancho Cucamonga- based California Credit Union League — one of the largest not-for-profit financial trade associations affecting almost one out of every three Californians.
At a time when banks are staggering under losses from the subprime mortgage meltdown, most credit unions are dodging that bullet, and they're actively engaging families about how to stay afloat amid a financial crisis.
Times are tough for thousands of Inland Empire residents. Some are on the brink of foreclosure, while others have already lost their homes because they couldn't keep up with their mortgage payments.
Local credit unions want to stop that.
In fact, some are even making special loans to financially drowning consumers getting hit by the subprime mess, and others are inviting families to attend financial literacy courses to help make sense of the region's slowing economy.
But the league is the invisible hand behind it all. It's worked tirelessly on behalf of its credit union members and is turning 75 this year.
Its message is loud and clear: Rich or poor, almost anyone can join a credit union.
"Credit unions are a better deal for almost everybody," said Bill Cheney, the League's president and CEO. "It's all about shared resources and working together. It's people helping people — that's always been our motto." The lanky executive is about as professional as financial executives get.
He claims 30 years in the credit union business since graduating from high school in Texas.
But he doesn't serve shareholders, nor big institutional investors. Cheney, just like member credit unions throughout the region, is beholden to millions of credit union customers who rely on the League's political muscle amid economic turmoil throughout California.
Beyond that, the organization stands for financial stability, and it's educating California residents that credit unions do just as good a job as banks of providing the financial means to own your dream home, or buy that car you can't live without.
"For people who are looking for mortgages right now, one of the best places to look is a credit union," said Ken Willis, founder of Upland-based League of California Homeowners.
Homeowner league members automatically gain membership into a local credit union that fits them, a move several members are benefitting from, Willis said.
The key is finding a credit union that's right for you.
"Membership is far more available today than it ever has been," Willis said. "It's partly due to political muscle. (The credit union industry) spent a lot of money to allow this, but it's paying off." Cheney insists that if it weren't for credit unions, banks would collectively monopolize the market and charge everyone higher loan interest rates.
That's not unthinkable. If they're publicly-traded companies, banks serve shareholders, and if not, they're obligated to financiers who expect returns on their investments.
Credit unions use profits to serve their members. They reinvest revenue so they can keep mortgage and auto loan interest rates low, if not lower than your average bank. They're taxed, but not at the federal level.
It's an interesting coincidence the League is celebrating its anniversary when the nation — and especially California — is suffering from what some experts say is the worst housing-related economic bust in history. The economy wasn't any better 75 years ago. Banks were going belly up left and right as the Great Depression was in full swing. More than 9,000 banks were suspended by the federal government over a three-year period.
Meanwhile, some California legislators advocated a franchise tax on credit unions, which would've killed the small ones. The long-term battle brought together 25 credit unions to form the League.
By 1940, almost 250 credit unions were members, representing 81,000 individuals. And today, more than 500 California credit unions claim membership, serving 10 million people.
The banking industry's legislative onslaught against credit unions will probably never end, but that's expected. Besides, the League is going strong. Another 75 years will prove its strength as it works to overcome false perceptions that credit unions only offer membership to a special few.
And the economic slowdown that's flirting with recession territory only makes the League's case even stronger.
"Today is an opportunity for credit unions to attract new members," Cheney said. "I think people are more timid with who they do business with these days. That's an opportunity for us to shine."
