Ever since the mailed announcement went out last month, Sno Falls Credit Union (CU) has been feeding calls from unhappy customers who noticed new fees on their checking accounts. The calls made it clear, not everyone read the letter inside their monthly statements.
The tough economic climate seen since the recession kicked in four years ago has finally forced big changes at the Valley’s longtime credit union. The most notable changes are the closure of the Sno Falls Credit Union Fall City branch at year-end – and new monthly $3 and $5 checking account fees.
The changes are not without reason, though. Although the credit union is NOT in danger of closing, there are many government rules and regulations it must now follow, including a legal requirement regarding how much profits a bank must have in reserve. These rules were put in place to avoid a future banking system collapse, like the near-collapse of 2008.
Most profits the Sno Falls CU has come in the form of interest earned on its deposits and loans it makes. So when a credit union member defaults on a loan, a tough economic reality during the recent recession, it impacts the credit union’s bottom line. Tougher loan qualification also reduced the number of credit union members qualifying for competitive loans. Added to that are tough government regulations on fees banks can charge debit/credit card accounts. For Sno Falls Credit Union, all of these factors compounded to decrease its profits – and, per state law, those profits need to stay at a certain level to keep the credit union solvent and independent.
Reacting early, Sno Falls Credit Union Board of Directors decided to take steps now to ensure their profits stay at the state- required level. Unfortunately, those steps mean reducing the number of branches and increasing some fees.
On a positive note, Sno Falls Snoqualmie Ridge Branch manager, Amber Brotherton, says the move also takes Sno Falls in a direction members have been requesting – improving its online banking services. Sno Falls CU hopes it will be able to invest more into its online division and possibly enhance its website.
So the reality is, the bottom line is the bottom line. To keep Snoqualmie Valley’s local credit union solvent and serving residents, these moves are necessary early versus late. For some, its been a bit hard to stomach, seeing fees on their bank account that for years have had none. And for those customers in Fall City, it means a drive to Snoqualmie when its necessary to physically step inside the credit union. In the long run though, the moves are designed to ensure the credit union is around for years to come.
But as credit union employees reminded me, in today’ online world, in-branch transactions are decreasing all the time. They say there is a need, and a member desire, to focus on the online side of their banking business. There are still three branches left to serve Sno Falls Credit Union customers – North Bend, Snoqualmie Ridge and downtown Snoqualmie. For local teenagers there is also the branch inside Mount Si High School.
Sno Falls Board of Directors also say the changes aren’t permanent. “As the credit union’s profits improve to what is required by state laws we will once again be in a place to take actions in reducing fees and increasing services.”