Altura Credit Union Announces Branch Changes and Restates 2010 Financial Results
For Immediate Release
Contact: Carol Kramer, 818.352.0278
(Riverside, Calif.) April 8, 2011 – Altura Credit Union today announced that it is closing its branch inside the Moreno Valley WalMart Super Center on May 18, converting three other branch locations to all-electronic branches beginning May 10, and eliminating 26 jobs concurrent with the branch changes.
The transitioning branches include: Temecula at 44575 Avenida de Missiones, which transitions on May 10; Murrieta at 40412 Murrieta Hot Springs Road, which transitions on May 11; and Riverside at 1616 University Ave., which transitions on May 17. The 26 branch positions being eliminated represent 11 percent of Altura’s workforce.
“Although the U.S. Government reported the recession officially ended in June of 2009, and the nation’s economy is steadily improving, the Inland Empire’s recovery is moving at a slower pace,” said Altura CEO Mark Hawkins. “The Riverside/Inland Empire area appears to be stabilizing, but not yet staging a comeback. Unemployment remains high at 14.1%, which impacts our Member’s lives and their ability to repay loans. As a result, Altura’s loan losses peaked in 2010.”
In fact, Altura restated its 2010 financial results after its auditors recommended boosting reserves for potential loan and lease losses by $3 million. Altura’s restated financials show a loss of $5.8 million for the year on assets of $726.8 million. Originally, Altura reported a loss of $2.9 million for 2010. The restated results are a marked improvement compared to 2009’s net loss of $20.1 million. Altura’s capital ratio for 2010 was also adjusted to 5.81% from the earlier reported 6.18%. (The National Credit Union Administration considers 6% to be adequately capitalized.)
“Although we believe the local economy has begun to stabilize, we felt it prudent to set aside more funds in reserve for potential losses,” said Hawkins. “We also have tightened our loan underwriting standards to limit risk. Unfortunately, that has reduced the number of new loans and the resulting income.”
“As a result,” Hawkins adds, “we continue to examine ways to further reduce our day-to-day operating expenses. That is why we made the difficult decision to close our only in-store branch and transition three others to all-electronic locations. The goal is to return Altura to profitability while minimizing disruptions in service to our Members,” he said.
Hawkins also points out that these four offices were among Altura’s most recent branch openings. Murrieta opened in 2006, while the others opened in 2008 – just before and during the onset of the recession. “These offices didn’t have the opportunity to grow and reach their potential because of the state of the economy; as a result, we are reducing their presence,” Hawkins said. “Yet we remain committed to these markets, which is why we are converting to electronic/ATM only branches.” Altura has a second branch in Moreno Valley at 12125 Day St.
The affected employees have been offered severance packages, outplacement services and Altura loan modification packages to assist them in their transition. Staffers also can apply for any open positions within the organization.
“These decisions are never easy. Unfortunately, with reduced income, we had few options for cutting expenses that didn’t involve staff layoffs,” Hawkins said.
Altura Credit Union is headquartered in Riverside. After May 17, Altura will have 12 branch locations in Riverside County, four of which will be all-electronic. Altura also offers online, mobile and telephone banking for its members’ convenience.
As the largest locally owned and operated credit union in the Inland Empire, Altura is open to anyone who lives, works, attends school or worships in Riverside and San Diego counties, as well as selected cities in Orange and San Bernardino counties. Altura Credit Union, www.alturacu.com , has been recognized with the California Award for Performance Excellence (CAPE), the state’s equivalent of the Malcolm Baldrige National Quality Award. Today, Altura Credit Union serves more than 106,500 members and has $731.2 million in total assets.
Carol Kramer for Altura Credit Union