Why I am running for the board at Vancity – Community Focus #1

After working in the credit union movement for the past 36 years it was time to retire last June. My wife was retiring from being a special needs teach in the Burnaby school system and we were ready to enter this new phase of our lives together. The summer was great.

A few people had approached me as to what I was going to do and my initial plan was just to take it easy. When asked if I would run for the Vancity Board it didn’t get considered until i read the Desired Director attributes and Experience on the Vancity web site. Then something stated to make sense with their request. This blog post and the other that follow will be a deeper dive as to why.

There were four points with the first topic under Community Focus – ”Demonstrated commitment to cooperative values and principles”. This was the most important one for me.

Credit unions are cooperatives that deliver financial services to members. Cooperatives have a unique role in our society for a variety of reasons and there a 7 principles of cooperatives that define us. Again Vancity had these distinctly pointed out to a link on their web page. The identity, culture and existence of a cooperative is embodied in these principles. Without a constant sifting of decisions that are made in concert with these principles, cooperatives will tend to act as corporations. The dilemma with cooperatives is that we haven’t been that good at articulating our reasons for existence in modern day terms to our communities. We need to constantly define and act out what a cooperative is in the setting we exist in. As the world moves forward this need becomes very apparent. Without it we become less relevant.

My career was based on these principles through the involvement of the credit unions I worked for and the work done with other credit unions both large and small. When commitment to these values and principles are aligned and lived, much of the meaning of why things are done, why directions and strategies are set and why we exist in the first place are understood. It makes total sense. I feel very comfortable that Vancity has this as a first point in building and maintaining their board.

Next – Community Focus #2 – Understanding communities

A National Credit Union and ducks

You will be hearing lots about recent federal Canadian draft legislation that allows credit unions to move beyond their historical provincial domains into a national marketplace. It will be an interesting debate.

To start off there will be a lot of new rules the new federal ‘credit union’ will have to operate under. But wait a second. Lets establish who and what this new entity will be. Will it be a ‘credit union’? I don’t think so. It will be a co-operative bank. Someone once said if it walks like a duck and talks like a duck it is a duck. And you don’t even have to look at the new set of rules that the co-operative bank will have to live under. Just look at what has happened in other co-operatives. Agricultural co-operatives (grain and dairy) have evolved from being co-operatives to corporations because their size dictated it. They needed more capital to grow. They just couldn’t find the capital from the membership or from the equity they had built up. They had to go beyond these two sources and that forced them to evolve into a corporation that could access capital markets. That happened with them and that is about to happen to credit unions as their size expands. They have a corporate model for growth that will eventually reach a point when there needs to be a choice to continue in some fashion as a credit union or to move to become a co-operative bank. I support this legislation as it follows historically what has happened in the co-operative system. Just make sure your members vote for it and realize if it walks like a co-operative bank and talks like a co-operative bank then it is a co-operative bank and not a credit union.

PS. This is one paragraph of what appeared in an Edmonton newspaper in response to the question about a credit unions going national.

In his 2010 federal budget, Finance Minister Jim Flaherty said Ottawa will draft legislation that allows credit unions to incorporate federally. Credit unions welcomed the move, saying operating outside their traditional provincial boundaries will give them more options to expand.

When a newspaper quotes “Credit unions welcomed” the move they must make sure they list the credit unions that have this opinion. It needs to say that this opinion is not held by most as a reason for welcoming the draft legislation.

Is this a trend in blogging?

I am just reviewing my Twitter feed and come across this

@rshevlin I’m considering pulling a Shevlin and saying sayonara to my blog. Half a visit per minute spent on a post may not be worth it.

What is happening here? First Shevlin and now the Warrior?

I can understand the need to move on, to see the limited resource of time diminish to the point of re-establishing one’s priorities but really that should be the main reason. Take some time off. Post a big blinking sign on your blog that you are on vacation and give us some lame excuse but please don’t quit. I mean how are you going to synthesize those diatribes into 140 characters? You can’t! What is going to happen to all those great ideas and thoughts that swirl around your cranium? They have to go somewhere or your head will explore.

Seriously though, and for purely selfish reasons, one puts together a group of blogs of some very intelligent and interesting people from every walk of life. For a few minutes every day you get to read what others are thinking and doing without any editorial bias from any unseen source. Sometimes they are good, sometimes they are bad but they are always read. They make sense and if they don’t you get to comment and contribute. They break down an individual barrier that we all struggle with, that of thinking we are alone in our thoughts. That someone from Boston or North Carolina or Iowa could make such a connection to someone in B.C. is a remarkable experience and one that I place a high value on. There are times someone hasn’t blogged for months. Then suddenly they appear again. Sure there are some that will never blog and that is ok. Maybe this is just a phase that blogging must go through. Like it isn’t centuries old is it.

One of my favourite authors is Robertson Davies. Over the years I have read his books, sometimes more than once. When he passed away, there would be no more books and that was sad. I have one book left of his that I haven’t read and that is being saved for a some warm summer days in the not to distant future. When someone like the CU Warrior says he maybe quitting I can appreciate his position. It isn’t like he won’t be around anymore. It is that there will be something missing. Life gets like that as you get older. Things are missed. We need to remember to celebrate the moment because that gets to be very important.

Social Capital and the positive capital of employment

My good friend and colleague William Azaroff has a very thoughtful post about the need for all of us to be creating social capital through our affiliations with others on the web and that this can prove a benefit with these different economic times upon us. I wanted to bring another view into focus.

I have long felt that as an employer (one that hires and fires) one of the most important aspects of working with people is to create an environment of trust and respect. Over the years there have been a number of people that have worked for the credit unions I have worked for that got their start with us and then moved on for various reasons. It has always been difficult to see these people leave as has been the case recently. You train and challenge them to be better employees and people and you watch them grow. Life does not remain stagnant and so things change and people move on.

It is important that as an employer you keep the relationships open to the point of having that person who wants to move on talk to you about it. When they feel confident enough to approach you to say that they are going to be looking for another job then you can prepare for their eventual departure. The process becomes healthy and proves to be a benefit to both parties. One of our employees told me they were looking for something else. That was a few months ago and they recently found a new job. They had the ability to say at any interview that they could call us, the current employer, for a reference. Now how powerful is that? They had the ability to take the time off for interviews without saying it was a doctors appointment. It was a transparent approach for them in moving their career path as they saw fit. It doesn’t happen often but when it does it puts a proper closure to the situation of leaving an old job and getting a new one.

Employers should be creating social capital that can be used by current employees as they need it. That should be the norm.

Then you have the other side when you have to let someone go. To terminate anyone is one of the most painful experiences you can imagine. To do it abruptly and quickly makes it worse. When you are able create a transitional plan that incorporates social values that both parties hold as important, that takes some of the pain out of the situation. The impact of loosing people affects the bottom line of course but the loss of anyone diminishes the social capital of any business in ways that one never realizes until that person has gone. You really can’t measure this loss. In the difficult times we will face in the future one hopes that the worst situation possible, loss of one’s job, can be handled with care, compassion and respect. Everyone deserves that.

This is the element that scares me the most for the future. Experience has taught me most people can live under difficult economic circumstances. It becomes tragic when people loose their livelihood. Much of what defines us is what we do and when we loose that important definition our lives become that much blacker. If social capital is one way of alleviating that despair it will make a true difference in how we move forward.

Whew! it’s over

I just finnished my 1 hour presentation at the 2008 National CU Lending Conference in St. John’s Newfoundland. It went well and of course you think you need to add more to your presentation until you realize you have 10 minutes left to cover about 20 minutes of material. The crowd was friendly.

It has been very enjoyable to be here. I hadn’t realized the history of this city, the beauty of the rugged terrain and the most amazing people on earth, Newfoundlanders. And you don’t have to go very far to be close to salt water. This is the kind of place that you will always want to return to.

Tomorrow it is back to the other side of the continent. I have been away for a week now living in hotel rooms and eating restaurant food. This may be exciting to the younger crowd but traveling is somehow loosing its glitter. I feel very honoured to have been chosen to speak at two conferences and meet people from both the American and Canadian credit union movements. It seems everyone has the same opinion about what is happening in the financial markets. Credit union will be ok and we don’t have to worry. That opinion was voiced by everyone. It does feel good to be part of a movement that did not contribute to this financial meltdown, that there is integrity in what we have done and what we continue to do. And with a growing number of younger people getting involved it can only get better.

TGIF

Another week has passed and the events continue.

Our youngest son returned to his home in Copenhagen last Saturday after a great one month visit. As well, a friend returned home to Powell River who had been boarding with us since January while going to school at UBC. It is always an adjustment in a home when the total inhabitants decrease by 50%. Our oldest son and daughter are here for a visit for the next 2 weeks and after that we are home alone again. At least I won’t have to watch or hear the PS3 with Grand Theft Auto blaring away. That is another story.

The iPhone is working out very well. The phone has been dropping calls once in a while out here in the Valley but in Burnaby-Vancouver there hasn’t been any problems. The ability to have one device deliver all of the applications you connect with is really unbelievable. All of us at work have now had iPhones for a month and the glitter still has not worn off. There is only one minor issue, the inability to have your SMS mesages use ringtones instead of the stock alarm sounds. The best and most used downloaded programs for me would be:

• Evernote – Great synching with your Mac desktop.

• Comic Touch – Just add some humour because who doesn’t need it.

• Exposure – decent Flickr app.

• Jott – very usable app with the notes feature.

• BoxOffice – never have to look for a newspaper to see what movies are playing.

• Stanza – the best book reader. Great classics for free.

• Shazam – I finally know the names of some songs after hearing them for years.

• Facebook – a very decent interface.

And the two best!

• Twitteriffic – much better than any other Twitter client.

• OmniFocus – the absolute best program for to dos, projects, etc. Done in the GTD style with synching to your desktop.

As it turns out there are 10. There are a few more that are useful at times and of course the web sites that have a great iPhone interface.

I have started planning for the two presentations I am doing next month. It is always amazing when you start thinking about what you will say, how you will present it, thinking that there ins’t enough material. Then you get started and you have to hack it back because there is too much material. You could probably spend an infinite amount of time always tweaking the end result. One talk will be at Forum Solutions Partnership Symposium in Indiana. The other is at the CUCC 2008 National Lending Conference in St. John’s Newfoundland. After looking at all the other speakers I feel like a lightweight in a heavyweight division.

I have just started a book by Susan Jacoby “The Age of American Unreason”. In it she analyses of the intellectual condition of the US. She does not pull any punches. It has some great writing with inventive and sharp cynical humour. Rationalism at its best.

Have a great weekend everyone! The dog days of summer are upon us.

It just makes one wonder

This is the stuff that drive me nuts.

Credit Union Central of B.C. merged with Ontario Central to form Central 1. Here is something from their homepage:

When the merger took effect on July 1, 2008, the combined organization had more than $7.5 billion in assets, with 475 employees based at offices in Vancouver and Mississauga serving nearly 200 credit unions with some 2.8 million members

Good stuff. But when I click on the following

C1 __ Central 1 Credit Union-1.jpg

I get this message:

eCentral:
Our server has detected that you are not using the MS Internet Explorer browser.
Unfortunately, this service is not available for your type of browser. Please use Internet Explorer (version 5 or newer) to access this service.
Explorer can be downloaded for free at: http://www.microsoft.com/windows/ie/downloads/default.asp. Sorry for any inconvenience.

That means Safari, Camino and Firefox don’t work. If you have a Mac good luck.

You would think an organization this size would create web pages that wouldn’t have to have Microsoft as the only company that could produce a browser to use the site. Yep $7.5 billion in assets with all those employees (who never use Macs) serving 200 CUs with some 2.8 million members (who never use Macs). I thought those days were over. The ones where you had to get Microsoft tattooed somewhere to get a job. There must be a good reason, right?

Small is beautiful to some

Ron has a blog post about the downside of being small. Great post with some definite statements about how small is not the panacea for everyone.

First, small and large are relative terms. They are labels we place upon items in order for us to gain some semblance of order. What is small to some will be large to others and the opposite, what is large for some is small for others. Remember the end of the film Men in Black II?

There is another aspect of an organization’s size that is of a prime concern. How it is managed. You can have any size FI and if it is managed well size, though a consideration, is part and parcel of many other goals and strategies. A badly managed organization doesn’t need size to fail.

Small to me means keeping the organization flat, tight, and productive. It means being able to move on a dime. It means ‘fighting’ with 3rd party suppliers that create expensive products that would force you into a strategy or product that is not even a 50% solution. It means quit ‘whining’ and do what you are supposed to do. Small means have staff meetings where the contribution is from everyone so you formulate objectives that are understood and agreed upon so you don’t need a marketing department to push anything. Small means you don’t have to structure meetings to decide on the colour of the toilet paper in the washrooms. The list could go on and on. It is important that the term small does not get translated in the terms most employ. Small by its nature in today’s society looked upon as an anomaly because so much that we are shown (big) is the antithesis of small. That is why I think ‘small is beautiful’.

Ron and Jeffery are right. You need more coming in that going out. A very simple rule of business. But not all mergers have delivered that ideal and so merging sometimes clouds the issue of what is really necessary – changing the management to at least begin to move forward. Sometimes I have seen mergers to build larger empires of senior management. FIs live and they die, nothing continues forever. Try as you might there may be conditions and reasons that are no longer available or valid to continue.

It would be very easy for the Board to say “we need 10% growth and nothing else matters!” Piece of cake. But when they say “we want at least 5% growth, keep the community happy with at least a 7% dividend, make sure donations are 7% of net income, be sure to continue to contribute to the social capital of the CU and the community, and deliver innovative products that are useful, as well as no line-ups in the branch, etc…well that gets a bit more difficult to manage. Keep the bottom line healthy and you can realize all and more of these goals. That is the tough part. Fine tuning all the aspects of what makes you successful. Growing in all of these aspects makes for a difficult and at times impossible situation. But man is it ever rewarding and satisfying when everyone contributes to making it happen. The biggest enemy of being small? Thinking small.

Never thought I was a Gonzo Banker

I was approached by the people at Cornerstone about writing a piece about me and the credit union. If you have done this a few times it tends to be much of the same. Who, what, why, where, when and how. Pretty standard stuff. But the people behind Gonzo Banker were different and when the article was published it was a pleasant surprise. They are good. The best part is that the Credit Union Foundation of B.C. gets $250 in U.S. dollars.

What happens when humans are like bees.

It is July, the time of vacations, with the weather finally something other than wet. You seem to wait most of the year for this kind of weather and when it arrives it is nice.

The staff got the rest of their iPhones today so everyone was setting things up, getting a bit lost in menus and experiencing what all the hype of the past week is actually about. It comes with some limitations that’s for sure but overall it is a tribute to Apple and their ingenuity.

First and foremost it is a phone, SMS communicator, email device, calendar, address book….well you get the picture. What it does well is that it is an extension of the Mac OS in what you can do and it works together with what you have on the desktop. I think of it as a mobile extension of a pretty good OS. And then there are the things that seem like science fiction coming true like the map function that shows you as that pulsating dot moving across a map. Why would you need step by step directions when you just follow the purple line as a pulsating dot? With a hybrid map choice it is so simple and almost unreal. We are just starting to learn what it can do and are pretty sure that a few unanswered questions can be solved with what this device offers.

Yesterday Tim (Currency) and William (Vancity) and I got together downtown for lunch and to go over what is needed for BarCampBankBC. Those two are right on top of it and we are well on our way to putting up the framework to make this a memorable event. At one point I had the iPhone out to update the Twitter bunch. After a picture and some text I quickly looked at the SMS messages and email. While I was doing this Tim and William were discussing something and I realized that I had actually left the group for a few minutes by what I was doing. This morning after thinking about what I had done I thought it needed a name so I called that type of action ‘hiving’. It is made up of hive with the -ing. I thought of a bee hive and how busy they always seem to be doing something and yet they are in close proximity. When you have that iPhone or BlackBerry in the midst of people and are doing something with it you are busy, doing what is anyones guess. It seems we do need a verb for what is being done as it is becoming very commonplace. To hive – to be busy or have the appearance of being busy, always within the midst of people, with a small computer-like device.

The iPhone and some new notions

As we spoke at BarCampBankDallas it became apparent that this new device will offer some solutions to problems we have had in the past. But maybe there is a bigger problem with us.

We have always been thinking of developing applications with the view that someone will be sitting at a laptop or desktop machine. That it is either stationary or mobile for use and that wifi or Ethernet connections may or may not be available. That is the physical environment of the user. But what happens with the iPhone?

Suddenly that environment is passé. Now the device has greater capacities and is in the pocket of the individual. Like a cell phone it will travel everywhere and will have that constant connection. It can be transmitting your geographic location and pushing you updates all the time.

We need to begin to think in more ‘real life’ situations. This may seem crazy but after being married for 36 years I like to know what my wife is doing and where she is. Before I head home from work I like to call her and tell her I am leaving. Sometimes I forget. In the near future this device will be able to tell her where I am. If I am stuck in traffic she should be able to see this. I don’t know how possible this was before but it will soon be a reality.

When thinking about financial services we can now view the possibility of geographic location of the person when they spend their money. If they use a debit card then the place of use can be paired up with the individual’s geographic location. Your alert mechanism for fraudulent use suddenly can take on some new dimensions.

And that seems to be the key, considering these new dimensions and being able to do development to deploy the application on the hardware. Software can become much more robust, much more specific and driven for much more usage. To put a function to use is going to be much easier. To use that function anywhere is going to make a major difference.

Sure there will be the glitzy ideas and software because this is so new and thought of as cool. But creating functional applications given the new parameters, that really could change the way some financial services and products are used and delivered. Fasten your seat belts.

BarCampBankDallas

Everyone is on there way home or soon to be headed in that direction. BarCampBankDallas is over and once again one sits back and slowly begins to digest what took place since Saturday morning.

The topic of the iPhone and what it can and will do for the financial service industry was discussed at length. The opportunities for development of products and services with this device surfaced again and again. In essence this device gives you some dimensions (where you are, where others are, push technology, enterprise development, etc.) that either were not available or unanswerable in the past. If Jobs is right in suggesting that the iPhone could reach 60% market share then this device could become as common as the iPod. When hardware and software arrive at this new technology plateau who knows where it will lead.

Regulators and regulation and what that means to this industry was considered in a number of sessions. No one likes this segment and though it is necessary sometimes it is very hard to see some reasonable means of dialogue with this group. It seems a continual challenge to find the resources in order to comply with these demands. Much of what we have and continue to do has not changed much but in the regulators eyes that does not matter.

There was an excellent mix of attendees with no single group becoming the main focus. I really appreciated the responses and input of so many people. Everyone there had a passion for the business and you could see that. The food was great and the venue was very different. There were a number of ‘creatures’ (stuffed animals) in the centre area that became part of few discussions. I had never seen a stuffed giraffe before.

People will ask me ‘Was it as good as Seattle or New England?” I have a hard time comparing each event because they are so different. They are all equal in some fashion but also different just based on the agenda and people. The first BarCampBank was exciting because it was new. Those that follow are exciting because you can understand what will be occurring. You not only measure what you learnt and discussed but also view the unmeasurable, the relationships that you have renewed and those new ones that you have made. To me that might be the most important aspect of BarCampBanking.

These relationships create that network of like minded individuals that for the most part are exploring technology, people and markets. They have the common desire to make something better, to change something. There is little if any of a defeatist attitude. You share stories, dreams and the realities of the business you live in. Larry Hooper was the only non-FI person there and it was great to hear his take on things. I think the story he shared is one reason why we continue to strive to do things better.

Did I come away with any great ideas? Certainly. The most important thing though was to hear that your ideas and your plans were being challenged and validated at the same time. You will only get that kind of response at a BarCampBank.

It was an enjoyable event. Good to see everyone again. Good the have some great food and experience that Texas hospitality.

Innovation is risky but healthy

Doug has presented an excellent post about CUs and innovation. But as I commented there is another side.

First I am not saying that all 3rd level CU organizations or 3rd party suppliers fit this pattern. There are a number of organizations and people within these organizations that get it. But in large part most fit the same pattern — keep it comfortable and maintain the status quo.

That pattern and the underlying mantra of most credit unions that their brand is sacrosanct creates the problem for innovation. Please don’t ask me for the answer on this one as I don’t have it. It is almost like the system governs the outcome and there is no reasonable explanation as to why it continues. Why can’t we work together to a greater degree? Because we have a brand to maintain and maybe some collaborative effort will diminish it. Our competitive edge will erode if it was know our CU competitors were involved. Or when we are at the table trying to collaborate we can’t agree because the brands get in the way. Maybe it would be just too difficult to have to re-build something by having to admit previous failures that were never fixed. Common sense doesn’t event get a chance to exist.

When you have a culture of innovation in your credit union it is risky. There are daily challenges as to why you continue to do things as before. In having this view you constantly challenge not only your CU but everyone else. There is acceptance in that you do have a proper product or service in place but that it could always you a bit of tweaking when you have the time and resources to do it. There is always this impatience and not being completely satsified. There is always the frustration of trying to arrive at the right solutions for your members. There is the fear of failure. There is the consequence of having spent so much time on something to see it not working as you thought. But all of this leads to the healthy.

You don’t do anything for the recognition but you do it to serve the members better and to make the staff’s daily routine easier and less mundane. You do it from an open source attitude. If another CU can use what you have and make it better isn’t that something better for all of us? You learn from the mistakes because you are willing to take the risk to make mistakes. You always move forward from a position of the positive. The health of your CU is certainly measured by it’s financial performance. There are also some subjective measures such as what have you produced for the members that they can use and value? Cloning a free checking or youth account doesn’t count. Challenging the status quo both inside and outside the CU is the starting point. Asking a simple 3 letter question is maybe the best way to start. “Why?”

The joys of technology

At work we have been using a program (Mac) called SnapMail for a number of years. It worked very well as the program allowed us to send messages, files and notify people immediately about anything. You could be typing an email and up comes a small screen telling you your wife is on the line or the Revenue Canada agent has been waiting to see you for 30 minutes. But in the last little while it hasn’t been working very well. It doesn’t seem to work with Leopard and Intel machines on Tiger have problems. We needed something different.

We seem to have gravitated to Skype. It really is a pretty good program to communicate with in a small office setting. In fact it has a lot of potential because it incorporates just about every method to communicate with someone — text, video, or phone.

Now what if we can have the same conversation with our members? There will be some who use Skype and probably would prefer it. The possibilities of better and different dialogues are pretty far reaching. It would definitely be a new conversation method. And what about Board members who need to know and discuss information on a periodic basis? This could be a very genuine means to hear and be heard within various groups of a credit union.

WDC – San Francisco. Two staff members head out Sunday for the Apple WDC next week. The agenda is full of opportunities to learn about the inner workings of the iPhone which we have come to see as a means to have some real effect on retail banking. When you realize that this piece of hardware (or something similar) will give the member a truly portable banking facility it is something we need to learn and prepare for. The possibilities to retrieve relevant financial information at any time, anywhere, begins to expand the definition of mobile banking. And Rogers will soon be selling iPhones here in Canada. There should also be more information about the Mac OS server product which is turning out to be a very stable and robust system. Most of what we have built that surrounds the core banking system is Mac based so San Francisco is going to be more than just “wearing flowers in your hair”.

Updated the OS, spoke out of the time zone and picked up a library book

I saw where Apple updated their OSX to 10.5.3. Usually I would wait and let others suffer the challenges but there have been some minor irritations for me with loading a series of tabs in Safari. For the past month if there were 20 or so loading the last 10 would fail to load. It wasn’t working properly at work. Then at home it would be ok with everything loading. We checked everything and nothing. With this update everything works fine. The pages load quickly and all the tabs loading.

This morning I had a great discussion with Morriss Partee of Everything CU. We discussed the upcoming BarCampBankDallas and BarCampBankBC which we will both be attending. The great thing is that we can continue these discussions shortly, face to face. He is one interesting person who has a great deal of passion for credit unions.

Was able to snap up “The Mind of the Market” by Michael Shermer. The inside cover states that the author uncovers the hidden psychology and biology that shape the way we think about money. That sounded interesting. Further down the page it said “Drawing on the new field of neuroeconomics…investigates what brain scans reveal about decision-making processes such as bargaining, snap purchases and establishing trust in business”. This looks interesting. I just hope the writer doesn’t wander off into the Land Contrived Assumptions.

And tomorrow is Friday!

P2P lending

It seems this “new method” of lending is beginning to re-appear on the Canadian market. CommunityLend has a web site with information about itself and what it does. There are some very valid points for peer to peer lending but there seems to be things that need to be discussed, outlined and disclosed.

Will this industry be regulated? In other words with a solicitation to the general public, through a business model that derives profit, is it to be viewed as a “bank”? Lending, for those that have not had much experience, is not just a science but also an art. There are a myriad of variables that one has to view and digest before funding a loan. My fear is that people are getting involved to save money i.e. cheaper interest rate for the lender and higher interest rate for the depositor, without assessing all of the risks involved. Lending institutions are obligated to follow some due diligence in lending due to responsibility to shareholders, owners, members, directors and regulators. If all goes well and there are no defaults everyone is happy. But one needs to plan and assess what will take place when things don’t go well.

CommunityLend is doing this for free. Maybe I have overlooked this on their site but could someone tell me if they are taking any fees or basis points for setting up these P2P loans. I see they have raised $2.5 million in capital so there are some costs to cover here.

The management, directors and advisors are a pretty knowledgeable group of individuals. Are they seeing CommunityLend as a good business that they can invest in? Being solely cynical, if they know the business they know what they can make in profit setup as the conduit for this type of industry. As a middleman they assume no risk and just piece the deal together. I would hope they would divulge their interest without the platitudes about social aspects of P2P lending. You are in it for the money, right? Wouldn’t a proper disclosure be in order similar to mortgage brokering?

Don’t get me wrong, I am for P2P as long as the playing field for all participants in a public call for funds is equal. Banks and larger financial institutions seem to think they are too big to finance smaller lending so there is a vacuum here that needs to be filled. Putting a term loan into a revolving credit card with an exorbitant interest rate does no one except the lender any ‘good’. I worry about people loosing money by not knowing what they are getting into.

Some sad news

When you are in the credit union business for long time you get to meet a lot of people. Sometimes you are very fortunate to meet some pretty wonderful people. When I first came to the credit union Frank was on the board of directors. He was a nurseryman, blunt, outspoken but a true co-operator and a fierce credit unionist. Over the years I got to know Frank quite well going for the occasional lunch and visiting him at his place. We had rousing discussions about member loyalty, the responsibility of the member and how important it was to be relative to the members. Beneath that harsh exterior was a very kind and gentle person who was true to himself. He used to show up with boxes of produce to give to the staff. The potatoes he grew were unlike anything I’ve tasted and it was an honour to have Frank give you some of his vegetables.

Everyday when coming to work I have passed Frank’s place and seen his trees grow to be harvested and his wonderful garden and hedges kept perfect and proper. This morning when I drove by I noticed a number of vehicles in the yard that hadn’t been there before. It just appeared strange. This afternoon we were told that Frank had passed away.

Today is a sad day. We will always remember Frank and when I drive by tonight it will be difficult to hold back the tears. He was a good man, someone you will genuinely miss. It’s people like Frank that make this job worthwhile. It’s people like Frank that make this life that much brighter. Take care Frank as we are all going to miss you.

Social Bookmarking and the dilemma of choice

At the recent Northern Voice conference Alan Levine made a presentation of WordPress Web sites that don’t look at all like a WordPress blog. Jim Groom also had a presentation about this. Alan had a tag on del.icio.us that he used to keep track of these sites and suggested anyone use it if they also found examples. There were a few people that mentioned work they had done in this area, Alan hit the sites, tagged them, and the source of the information was complete. It was the first time I had seen that happen at a public session.Wikipedia has an interesting introduction on social bookmarking that deserves reading. The article mentions other sites including Simpy and Ma.gnolia. There are a vast variety of features in them all but it brings up the Twitter vs Pownce debate again. Trey twittered William’s quote this morning — community beats cool. With the plethora of web apps available does one choose to use something because it works, works better, has more features or there are more people using it?I would like to use Pownce but there are so few of us there that everyone has drifted back to Twitter. (Flock does a decent but not perfect job of helping one keep informed about the feeds.) So community has outweighed function with that choice. One of the problems we all face is filtering. There are volumes of information pushed out onto the web daily that make it impossible to keep up with. Here again the ‘wisdom of crowds’ comes into play. The use a common social bookmarking service could filter and highlight for all of us those areas of interest. I would love to have an RSS feed of informative bookmarks suggested by friends and peers on a daily basis. It can only add to keeping current on so many important subjects. But again who does one pick? De.licio.us, Ma.gnolia, Simpy or ??

Desjardins movement and it’s truly co-operative nature

Last night a number of credit unions attended an information session by the Desjardin Group. Most of us came to listen to what their IT people had as a banking system. What it turned out to be was a lesson on how a 100 year old co-operative financial system has evolved for its members.

There were presentations by all the component groups (subsidiaries) of the Desjardin Group. Insurance, brokerage, wealth management, payroll services, Visa and IT. Here is a quote from their Web site:

“Desjardins Group is an organization of caisses populaires and caisses d’économie (credit unions). The 516 caisses Desjardins in Québec and Ontario (494 in Quebec and 22 in Ontario1) and their 911 service centres (869 in Quebec and 42 in Ontario1) are assembled under a single federation: the Fédération des caisses Desjardins du Québec.”

This organization has an asset size of $147 billion made up of credit unions from $20 million to a a few over $1 billion. The average size is $170 million. Their whole infrastructure is built to serve the member caisse populaire (credit union). Again and again the co-operative nature of the organization was presented. It was an eye opener.

Why are we becoming aware of Desjardins? In the last few years their members voted to allow other credit unions to participate in the products and services they have developed. The meeting had 93% voting in favour of the motiion. It still is a street fight among themselves in the retail market but there is no discussion as to how fundamental services are to be built and made available.

So when we talk about credit unions individually here is a prime example of where the independent credit unions moved co-operatively to build a system that can compete with the banks. In Quebec the banks are second to credit unions. Sound pretty good doesn’t it. But remember it took some time to get there. Keep them in mind because they are here to stay.