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Credit unions see growth despite hard economic times

By Johnny Jackson

jjackson@henryherald.com

Officials with the area's not-for-profit financial cooperatives are boasting of increased business, despite the national credit crunch that continues to plague many of the nation's other financial institutions.

"We've grown our loan portfolio this year by 17 percent," said Todd Marksberry, Delta Community Credit Union executive vice president and chief operations officer. "Right now, we're just above 15 percent capital. We're in a great capital position."

Year-to-date, Delta Community has increased its membership by 8 percent, which is about 1,000 new members per month.

According to Marksberry, the credit union's membership has grown particularly fast at its Stockbridge branches at Mt. Zion, 5006 Mt. Zion Parkway, and Eagle's Landing, 285 Center Pointe Parkway.

In all, the credit union has about 175,000 members, each with savings accounts and 100,000 with checking accounts. Second to the credit union's depository accounts are its loan accounts in automobile lending and mortgage lending. Mortgage lending continues to be the most utilized member financing endeavor at the credit union.

Credit unions throughout the region have been seeing spikes in their mortgage refinancing programs also, as many consumers are seeking out credit unions to refinance their home mortgages at lower interest rates.

"The interest we earn on loans and other products and services, we typically return that to customers in the form of lower interest rates...," Marksberry added.

According to data published by the National Credit Union Administration (NCUA), mortgage production among credit unions rose 10.1 percent during the first half of 2008.

In recent months, consumers have become increasingly interested in lowering interest rates on their credit and loan accounts. Credit unions generally have invested in prime mortgages and consumer loans as opposed to sub-prime lending, which is one reason officials say there has been no significant increase in defaults and delinquencies that other lenders have experienced.

"We've experienced tremendous growth in the mortgage loan area," said Kim Wall, vice president of marketing at Georgia Federal Credit Union. "I think a lot of the reason we've done well is that we've got really competitive interest rates and mortgage loan programs. People are looking for a place of safety and soundness."

Wall said that depository accounts at the Georgia Federal have also increased in number, contributing to the credit union's 15 percent capital rating which exceeds the average for peer financial institutions. It's local branch, located at 105 North Park Trail in Stockbridge, serves many of Henry County's largest employers and families.

"We are definitely a great banking alternative," she said. "Consumer advocates will agree that credit unions provide a safe alternative for your money. I think in this economy people are looking for a safe place to put their money. We offer most of the same services that are offered at your commercial banks."

Credit unions have also raised their National Credit Union Share Insurance Fund (NCUSIF) insurance limits as defined by the Emergency Economic Stabilization Act. Now through Dec. 31, 2009, the limits have been moved up from $100,000 to $250,000 per qualified depositor on savings, checking, money market, or CD accounts.

"We are probably one of the strongest credit unions in the nation," Wall added. "We serve 82,000 members statewide, and we're going to be here for them in good times and bad. That's what credit unions are for."

Georgia Federal and Delta are two of about a dozen credit unions in the area.

"The current unrest in the financial marketplace has made consumers uneasy and caused them to be more diligent in choosing a provider," said Rick Foley, president and CEO of Delta Community. "We don't invest in high-risk or complicated securities and financial instruments issued by investment banks. Credit unions have a track record of earning the confidence of the consumer, and we believe we stand out as a compelling alternative for people now more than ever."

For those interested in learning more about managing their credit and finances and business owners in particular, Clayton State University's Small Business Development Center (SBDC) will present a free seminar on Nov. 11, about "The Credit Crunch: Understanding and Protecting your Credit."

"This seminar is geared towards current and potential business owners who are trying to either build or start their business," said Kyle Hensel, SBDC area director. "It will help them understand the credit process, FICO scores, and will give them tips on how to improve their credit score. I think this seminar is extremely timely, seeing what is happening in the economy and the banks right now."

The seminar will be, from 10 a.m. until noon, in room 272 of the James M. Baker University Center on the Clayton State campus. Attendees should sign up in advance, Online at www.business.clayton.edu/sbdc, or to call (678) 466-5100.