A blog addressing issues and topics of interest for Montana credit union board members. Read a new post every week.
Let me guess, that headline has you thinking about heart attacks and resuscitation? The CPR I am talking about today is much more positive. It is a Custom Performance Report, and is a valuable tool for board discussions. It is distributed quarterly to your credit union manager/CEO.
MCUN provides the report as a dues service, meaning that as an affiliate of our association, you don’t pay any extra for it. They are based on information provided in your NCUA 5300 report and include not only your credit union’s numbers, but also totals for Montana, our region, and the nation that you can use for peer comparison.
There are four categories of ratios within the 40-page report: Safety & Soundness, Competitive, Productivity, and Member Service. By reviewing the numbers and charts provided for the current period and successive years, both point-in-time and trends can be seen. Credit unions may have goals and measurements, but if you are not tracking your institution against peer groups, you may overlook important information. The full page industry overview at the start of the report may also provide valuable information and help you keep your finger on the pulse of things occurring outside your local market that could impact your credit union.
The real benefit of these reports is not just the numerical data that is provided, or the easy-to-read charts and graphs, but the conversation that it should be evoking during board meetings. Credit unions of all sizes have thanked us for this valuable report, and most say they share it with their board members.The CPR has strategic questions in each section to facilitate and breathe more life into critical discussions. For example, a question in the earnings section might ask “Does the earnings structure reflect your credit union's goals and philosophy?” It is not intended to tell you that your earnings are not correct, but instead, to have you reflect on the reasons behind WHY it may or may not within goals that your credit union set.
If you have not yet taken full advantage of the CPR for board level discussions, I urge you to consider it. You have direct responsibility for the financial health of the institution, so why not use all the tools at your disposal to achieve that?
NCUA takes about two months after each quarterly 5300 report deadline to release it, so the CPR is generally available for download about 10 weeks after each quarter end. I email your CEO/manager directly to let them know it is ready and expect to be notifying them soon of the next one. Look for it on your agenda!
Donya Parrish is the VP-Dues Based Services for the Montana Credit Union Network. She would welcome any questions or comments on this material. You can email Donya or call her at 800-745-5546, ext. 122.