Ask Chuck: Small Credit Union Advice from the CUinsight Community #4

Chuck Cockburn travels across the United States coaching small and mid-size credit union CEOs on how to create a foundation for long-term success. Submit your confidential question to Chuck by emailing AskChuck@CUinsight.com.

Dear Chuck:

I’m embarrassed to admit, I don’t know how to create projections. I want to purchase two new ATM machines, but the examiners are telling me now is not the time. I see the potential in the areas I want to place these machines, I’m afraid someone else will jump before I do, taking the valuable spaces. What should I do?

Signed,

Without Projections ($12 million in assets)

Dear Without Projections:

Projecting ATM usage requires that you estimate the number of members and non-members that will use the ATM on a monthly basis and the fees you would charge non-members. Your ATM vendor should be able to provide you with average monthly usage. This information combined with your own knowledge of the number of members in close proximity to the ATM should provide you with enough information to make reasonable estimates of monthly usage. Keep in mind that additional ATMs provide greater convenience to some members while increasing your expenses. If your credit union has a high Expense Ratio and/or a low ROA, you may want to delay installation.

Chuck is the President of Credit Union Strategic Planning, leading the Net Worth Restoration, Field of Membership Expansion, Board Governance and Small Credit Union CEO Mentorship Programs. Chuck’s 25-year CEO track record (and 40 in the business) has been to profitably grow credit unions while significantly improving service and morale. Chuck’s coaching resulted in eight prior direct reports becoming credit union CEOs.