BECU goes to bat for small credit union

OLYMPIA - The state's largest credit union is helping one of the state's smallest by funding a marketing campaign for Tulip Cooperative Credit Union, a seven-year-old credit union based at the Olympia Food Co-op.

Tulip’s partner in the effort is the $8.9 billion Boeing Employees Credit Union, which is funding a campaign to help Tulip diversify its membership base.

Tulip was created to serve low- to moderate-income people, but board members hope to entice the “socially conscious borrower” – someone who might borrow $25,000 for a car loan, knowing those loans will help fund smaller loans for low-income members, board Chairman Eric Bowman said Friday. Generating more loans will help the credit union grow, he said. At one point, loan activity at Tulip had fallen to $800 from $10,000, Bowman said.

“It’s a face-lift to better tell our story,” he said about the marketing effort.

The marketing campaign, which is being produced by a Spokane-based advertising agency, is expected to be launched this fall. It involves changing the credit union’s logo, Internet videos that can be posted to YouTube and the social networking site Facebook, and print advertising, Bowman said. The credit union also hopes to create signs that will raise its profile at the Olympia Food Co- op’s east side location, he said.

The marketing campaign comes at the right time for Tulip, a credit union that is on much better financial footing than it was a year ago. Last year, the credit union was not in good shape.

Credit unions are required to have capital reserves that total 7 percent or more of their total assets to be considered “well capitalized,” said Linda Jekel, director of credit unions for the state Department of Financial Institutions. By that standard, Tulip fell to 2.07 percent last year but is back up to 7.25 percent as of June 30, she said.

Tulip today reports having 1,013 members and total assets of $2.2 million.

Boeing Employees Credit Union also played a role in boosting Tulip’s financial fortunes. Credit unions can’t raise money quickly because they don’t sell stock the way a bank does, but low-income credit unions can tap “secondary capital” in which they can receive a long-term loan at low or no interest. Tulip received $100,000 in secondary capital from BECU, plus some grant funds from other sources, to help improve its financial footing, Bowman said.

A financially troubled credit union typically will seek a merger partner, but it is not unusual for a much larger credit union to help a smaller credit union, Jekel said. BECU also has assisted Express Credit Union, a low-income credit union in Seattle, with its back-office functions, such as Internet and compu- ter support, said Tom Berquist, senior vice president of member strategy for BECU.

Tulip also receives daily operations support from Washington State Employees Credit Union, and Generations Credit Union, also in Olympia, has helped Tulip with collections, Bowman said.

“It takes a village,” he said.

Rolf Boone: 360-754-5403 rboone@theolympian.com www.theolympian.com/bizblog