“There’s really no other way to do it. You have to shrink to earn money,” he said.
From about $1.5 billion in total assets in 2008, NICU was reduced to $1.08 billion in assets as of the end of June. It closed seven branches, and cut its staff by about 40 percent, from about 500 people to less than 300. It also became extremely tight making new loans, and stopped paying higher rates on term deposits.
From more than $1 billion in loans, NICU shrank its portfolio to $647 million at the end of June.
After recording net profits in both 2010 and 2011, the credit union is now looking at increasing some types of lending, particularly to small businesses, Tippets said.
“We’re back in the business lending, back in real estate lending and we’re actually having a very good year on the auto side,” he said. Car loans have more than tripled above what they were during the previous two years, he said.
While business lending makes up a small part of NICU’s portfolio, Tippets said he hopes that pending legislation passes to allow credit unions to do more of this.
“You need business loans to balance your portfolio, and this is also good for the community and for small businesses,” he said. “To have more competition out there making business loans is good thing.”
The commercial banking industry actively opposes proposed changes that would increase credit unions’ ability to make more business loans.
While Tippets successor hasn’t been named yet, the “hand-off” to a new leader will happen soon, letting him get to his second retirement.
He leaves the job feeling good about what he and his team achieved, but says the work isn’t finished.
“This has been a fun story to tell,” Tippets said. “But the glass is only half-full…We’re not done yet.”