Payment Industry Insider

Liquidity really comes down to having enough money available to provide for the credit and withdrawal demands of your membership. Sounds pretty straight forward, doesn’t it? So why don’t we "get it"?

Well there is this little thing called reality that throws curves at us; keeps us from being able to gather the money as easily as we would like to. Competition, consumer choices, and convenience are probably the issues that most often hinder our ease of deposit gathering and credit granting.

Note: This article does not focus on excess liquidity.

Unfortunately I sometimes find that credit unions are overly concerned about the asset liability management (ALM) aspects of deposit growth, and they forget the very issue of growth itself.

Bottom line: If you don’t pay attention to deposit growth, and consequently you don’t grow - at least not as much as you need to - you don’t have to worry about how good your ALM skills are. If you don’t have the business (deposit growth), after awhile you won’t be in business.

Credit unions would do well to consider how they can grow their business. What are the difference makers - about you - that will attract business to your credit union?