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Mississippi’s credit unions doing well despite floundering economy

Mississippi’s credit unions are alive and well. In spite of the floundering economy and national banking woes, credit unions are reporting a good year.

“Credit unions in Mississippi are doing very well,” says Charles Elliott, president and CEO of the Mississippi Association of Credit Unions. “The mortgage crisis did not affect us. We never got involved in subprime loans. Our delinquency rates are low and our charge-offs are still about 0.6 percent, which is very low.”

Still, he feels his members will experience some of the economic downturn if there are employee layoffs because credit unions mostly serve employee groups. That scenario hasn’t reached the state yet, and meanwhile some credit unions have had large increases in deposits.

“That growth is due to people taking money out of the stock market and looking for safety and security for their money in credit unions,” Elliott said. “We also had the increase in our deposit insurance that is federally guaranteed, just like banks.”

Steve Pollman, CEO of Magnolia Federal Credit Union of Jackson, agrees that the credit union industry in Mississippi has not been adversely affected by the tough economic times, much of that due to their lack of involvement in sub prime lending, a practice he calls “monkey business mortgages.”

“We do some mortgage loans within conservative guidelines but mostly do consumer lending,” he said. “We’ve actually seen some growth and have money to lend.”

He says Magnolia, which changed its charter four years ago to a community credit union, has had an increase in deposits and is in great shape.

Mutual Credit Union of Vicksburg is doing better this year than it has the past two years with earnings and growth, according to CEO Charles Mullins. “We’ve had approximately 6 percent growth so far in our deposit base. We’re performing real well although automobile loans are soft,” he said. “Our lending procedures have always been conservative and we haven’t changed.”

Mullins, who’s been in the position 14 years, says credit unions are not immune to the economy but their health remains good. “We’ll do our business plan for 2009 based on a slowdown in the economy, but will be pleased if that doesn’t happen,” he says. “Our mission is to serve our members. We wake up every morning thinking how we can do that.”

Statewide Federal Credit Union serves 80 different employee groups in the old style of credit unions. CEO Paul Armstrong says the Flowood-based credit union is in good shape with consumer loan growth of approximately ten percent more than was forecast.

“Deposits have grown the same amount,” he said. “We haven’t seen a downturn. Business is better this year than last year.”

He thinks that is due to the flight to safety that some people see in credit unions. “They see us as a shelter because we didn’t invest in risky loans,” he said. “We’re making loans at the same rate. We haven’t changed our credit standards and limits at all. We’ve stayed steady and consistent, remembering that we’re dealing with our members’ money.”

Armstrong has been in the business 34 years, seeing a lot come and go. He recently had something new happen when a local banker called to ask if Statewide would make a signature loan for a bank customer.

“That bank doesn’t make signature loans anymore and the banker was trying to help his customer,” he said. “That shows how strange the world is now.”

Keesler Federal Credit Union, the largest Mississippi-based credit union, continues to be a strong and sound financial institution, says senior vice president and CAO John Goff.

Contact MBJ contributing writer Lynn Lofton at llofton656@aol.com.


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