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Hello and welcome to our first edition of The Juicy Stuff: An Interview Series with Our Board Members. Each month throughout 2019, I will be interviewing one of our board members and publishing it to our blog, right here. The interview is a mix of strategic questions as well as surprise questions to keep things entertaining.
Our Board includes a diverse group of credit unions executives, all with an exceptional history in the CU movement. They represent credit unions from $100M to $2.3B in assets, from New Mexico to Washington, DC, and from delivery channel to back office services.
It was only appropriate to interview our Chairman first, Mr. Mike Williams, CEO of $200M Colorado Credit Union.
I must have offended the weather gods as I drove down to visit Mike in Littleton, a southern suburb of Denver. A blizzard was looming behind the foothills and the snow was gently falling, but not sticking. The drive back to Denver was a different story, but more on that later.
Mike has been CEO of Colorado Credit Union for just over 25 years. He has spent nearly his whole career in the credit union industry and is one of the most passionate individuals I have ever spoken with about the credit union movement. I settled in to the interview in Mike’s toasty warm office as the snow started to fly.
Alicia Disantis, Marketing Manager at CU Service Network: Thanks for taking the time for this interview Mike. Let’s get started.
Mike Williams: Ultimately, we’ve been on a pretty steep growth plane, and we want to continue that. We want to continue focusing on operating expenses and bringing them down. Over the last couple of years and this year included, we have invested a lot of money in infrastructure and need to accelerate our growth to drive the operating expense ratio down.
A: I noticed there have been a lot of credit unions that have been opening new branches in Denver metro.
M: We are all growing, and it's fun. It is nice to be playing offense again, instead of during the recession when we were all buttoning down and not spending money. Our ROA is strong; our delinquency is low. People are working and they are comfortable. They are buying homes and cars. Colorado has been booming. Things are good for Colorado credit unions right now, not just…Colorado Credit Union.
A: Ok, its time for your first secret question. [Mike chuckles nervously]
M: [Laughing] The Last Alaskans, the reality series about Alaska.
A: They have the one with the truckers that go across the ice, too. Those are some rough dudes.
M: Oh My! They are out living by themselves in the middle of nowhere, in the dead of winter. It just fascinates me.
A: Have you been to Alaska?
M: We went a couple of years ago on a cruise. We didn’t get to spend a lot of time on the land, but it was awesome.
M: I want to go back and take the train up to Denali. That is my thing; I love all that stuff. I’ve always romanticized the mountain man persona. I always felt I was born 200 years late.
A: Well, you are close (gesturing to the mountains outside). You could be a mountain man [above]
M: Right? I could grow a beard.
A: Some furs? A big suede coat?
M: They would think I finally lost it. They know it’s coming, but I am not there just yet.
M: For the first time in a long time, we really struggled from a liquidity standpoint. We were loaned out, and growing deposits was a real challenge for us. The economy has changed, and people are keeping money in the stock market longer. When things get a little rough, they stay invested as opposed to bailing. In the past, when there was any threat of a stock market drop, members pulled the money out of the market and deposited it at the credit union. We didn’t see that this year.
Members are more comfortable with keeping their money in stocks, and many of their investments are in stocks that are paying dividends. They are riding out the fluctuations. The internet is driving this changing dynamic. People are more comfortable without any face-to-face interaction. It has been fascinating to watch the evolution.
We had a good year for growth , which was planned, but our loans outpaced our deposits, so we had a liquidity issue.
Also, as we continue to grow, compliance is becoming a more important issue. We’ve created a risk management department, which is an additional expense. As we discussed we are always trying to watch our operating expenses. We decided to use CUSN’s outsourced compliance service to supplement our risk management department and reduce some of the cost of having a new risk management department.
M: [long pause] Complacency. It drives me crazy. The “we've always done it that way” mentality. You won’t hear that in this office. I won’t tolerate it. We have to be changing and moving forward.
A: Does this play into your credit union’s vision?
M: Absolutely, we are constantly looking for ways to make the relationship with our members better and make their lives better. You can’t do that with old technology…and old thoughts. I personally try to stay up to date on technology. I was an early adopter of iPads. I use Alexa; we have it all over our house. My wife doesn’t trust it and is convinced Alexia is hearing everything we are saying, which is probably true. We are pretty boring so it doesn’t really matter! [laughing]
M: [with zero hesitation] Classic rock.
A: Ok, name some bands.
M: Boston, Styx, Doobie Brothers, Tom Petty
A: RIP Tom Petty
M: Yeah, Kerry Spradling (of White Crown CU), Dan Kester (of Sooper CU), Brandi Stankovic (of CUNA) and I were fortunate enough to see him at Red Rocks a few years ago [above]. It was awesome. I love all those classic rock bands. Boston comes on and look out! I used to fancy myself as having a good voice, but as I get older, the highs I can’t hit any more. I try to go there and my daughter looks at me like “no.” stop it.
[Insert 10 minutes of chatting about classic rock]
A: Do you listen to music in your office?
M: I do: SiriusXM, Classic Vinyl, Classic Rewind. The Bridge.
M: That hurts my feelings when you say “decades.”
A: Everyone gets upset when I use that phrase, but I think it makes you sound distinguished. I guess I will stop using it. [Laughter]
M: That was a tough question, I was really thinking this through.
The internet and where it has gone. Traditional banking is nothing like it used to be, nothing. You can get a loan approved…and funded in minutes. It used to be a two-day process. The demands of the consumer have changed. Expectations of delivery channels - they want to be able to access us in many different ways.
Also, I don’t know that I should have been surprised, but I was and that’s the expedited consolidation of the industry. It’s going a lot faster than I thought it would. I understand why. The economies of scale that come with size do make a difference in our industry.
This whole game has changed. Fintech is totally disrupting our former model. And that leads into your next question.
A: Well...we are not ready for that question yet.
M: Oh, you are going to hit me with another one?
M: [Very long pause and tapping of desk with pen]. I am the perfect boss, ha! [Another long pause] You should probably ask them! [Yet another long pause] That’s a good question. [laughing] I probably still have my hands on too much. I try to be a hands-off manager. As we continue to grow, I’ve had to let more and more go to my senior managers. I do think they would tell you I do not micromanage though.
Well, one of the goofy things is that I grew up in a rural farming community, and I have a lot of farming analogies.
A: [muffled laughter]
M: They call them Mike-isms. Like “You gotta make hay while the sun’s out.”
A: That is a common phrase though!
M: A lot of my staff hasn’t heard of it. They have a box they check, with there’s another Mike-ism. One day I walked in and the back of my office door had post-it notes with all my isms. When I read them, I was like “Oh god, you are right.”
[Thinking]…I hope there is nothing terrible that drives them crazy.
A: So no tuna fish in the fridge?
M: No, nothing like that. I eat lunch out of the office.
M: [No hesitation] Broncos. Lifelong Broncos fan.
A: Would you like to comment on their current season?
M: Yeah they stunk. I think they are making the necessary changes though. Secondly, I would be remiss if I didn’t mention the Colorado Buffs. My dad was an alumnus. I was a Buffs fan before I was a Broncos fan.
M: The same advice I give everyone else: Find what you are passionate about in life and chase it. There’s a lot of cool things going on with credit unions. The fact that we get to help people every day is a real blessing, and a lot of people don’t get to do that in their careers. Additionally, if you are not happy where you are, move on, life is too short to be unhappy You are not doing yourself nor anyone else a favor by sticking around. I’ve been blessed, because I love what I do. I am 58 now. I started in credit unions when I was 25. I still get up every morning and want to come to work, and so much of that is what is going on in that lobby. Knowing that we are helping members, that is what drives me. That, and I have a great staff and board that I truly enjoy working with.
I hope people see us as an aggressive and progressive credit union. That we have our foot on the gas.
A: I know the region certainly thinks of you in that way.
M: We try to be leaders. I couldn’t imagine doing anything else.
M: The reality is that credit unions have a very bright future. I do think there will be a lot more consolidation. We are going to have to think of ways to collaborate and drive operating expenses down. The smaller credit unions will not be able to compete with even the bigger credit unions, let alone the big banks. There are new threats out there, like Amazon or Apple entering the marketplace. How do you compete with that? It has to be operating expense driven. We will fight to get there.
That is where organizations like CUSN come in. CUSN plays a great role in bringing everyone together for a common goal and drive those operating expenses down with back office services.
A: OK, you are not off the hook yet.
M: Playing the mountains, four wheeling. All day.
A: Do you have a favorite season?
M: Hands down, fall.
A: Do you have a favorite place?
M: I love Poudre Canyon [above]. There is a church camp I go up to all the time, as far back as when I was a kid. My father was on the board, I was on the board. My daughter worked up there for three years.
A: Well thank you Mike, this was wonderful.
M: My pleasure.
As I turned off my audio recorder, I swiveled to look outside. It was a whiteout. “Maybe the roads wouldn’t be slick,” I thought. I was wrong. I was lucky enough to have perfectly timed my drive back north with the start of a full-blown blizzard. The plows didn’t make it out yet. The roads were yet to be treated. And I have a Honda Civic. They closed part of C-470 (the part I needed to drive through of course) minutes before I passed through. I-70 closed. Cars were spinning out.
A good afternoon for a Colorado Mountain Man.