Safe, Sound, and Secure
Written by Mike on July 16th, 2008
There has been a significant amount of negative news lately regarding financial institutions, some of which may be facing difficulties because of the loan losses associated with the housing market. The financial pressures being faced by most Americans due to the higher gas prices and declining home values have added to the downturn of the state of the economy.
Even in these difficult times, we are proud to report that Los Angeles Firemen’s Credit Union remains safe, sound, and secure. Some financial institutions are experiencing problems due to their participation in negative amortization and/or sub-prime mortgage loan fundings. LAFCU never invested in these types of mortgages. Furthermore, LAFCU is well capitalized and at levels far above what our regulators require to be “Well Capitalized.”
Today we continue to offer both deposit and lending services, including firsts, seconds, and home equity lines of credit. Due to our exclusive firefighter field of membership and strong underwriting practices, we are not experiencing significant levels of delinquencies and/or loan losses. When evaluating our future growth, we strive to offer the best products and services without compromising the integrity, value, trust, and safety and soundness of LAFCU. The best investment we can make with your savings dollars is to loan it to another member of the Fire Family with proper underwriting. This focus has allowed your Credit Union to grow financially strong in both good and bad economic conditions.
Many members, knowing that LAFCU is a safe and trusted financial institution have been bringing in additional funds to the Credit Union. We stand ready to provide that safe harbor for all members. We want you to know that LAFCU is privately insured by the nation’s largest provider of private insurance for Credit Unions. Your accounts are protected through American Share Insurance for up to $500,000 per account type (i.e. savings, checking, term certificate, etc.). To view our annual report, please visit the About LAFCU section on our website.
Los Angeles Firemen’s Credit Union is committed to providing its members with exceptional financial products and services, along with quality service. And as member owners of the organization, our members share in our success and profitability through competitive share and loan rates, value added services, lower fee structure, and an interest refund and extraordinary dividend bonus.
Attention to members’ needs and expectations has enabled us to grow from just over 800 members the first year, to 26,000 members today, with current assets at over $800 million. We serve over 140 fire departments across the state of California. At LAFCU, our mission is to provide you superior, fire family service while maintaining our financial security.
If you ever have any concerns, please call me directly at 323-550-2240. Thank you for your partnership and trust for over 73 years.
Mike Mastro
President/CEO
I appreciate you sending this message out.
posted on July 21st, 2008 at 9:13 amMr. Mastro
President/CEO
I am a new member to the Los Angeles Firemen’s Credit Union from Alameda County Fire Department in Northern California.
I just discontinued business with my old credit union after 20 plus years to join LAFCU. I cannot begin to tell you how impressed I am with the service and help that your representatives Yanet Cureto and Jack Edelman have provided. Keep up the good work…
posted on July 17th, 2008 at 9:17 amThanks for the peace of mind.
posted on July 17th, 2008 at 9:29 amThank you,
I needed that. So very assuring to know my money, small as it is, is safe with you.
posted on July 17th, 2008 at 10:18 amGood job. I think the next thing would be to tell all of us the details about the what and how of what each member will go through with the insurance Co. if things were to go bad with the Credit Union. What the process is and how it works with the Insurance Co. Things like who and how we (the members) get in touch with the correct person, or department, forms needed, etc, in order to get the ball rolling in the right direction during what would be a bad time, with time being of great importance !! This information of the why and how to deal with a problem, would make all of us (members) feel even more secure in these times of insecurity.
That said – - my wife and I have just put everything we have into our Credit Union.
Question – - Why is our Credit Union $$ insured by a private company and not a public company ?? How can anyone check to see how sound American Share Insurance Co. is ??
posted on July 17th, 2008 at 11:03 amI really appreciate and thank you for sending out this e-mail.I knew there was a reason I keep my accounts at LAFCU.
posted on July 17th, 2008 at 11:14 amMr. Mike Mastro,
I want to thank you for taking the time to speak with me over the phone, regarding the troubling financial times we are now faced with. Your comments and explanations instilled great confidence in me of the financial position and secure standing of the Los Angeles Firemen’s Credit Union.
I also wish to commend you of the fine news letter you sent, titled Safe,Sound and Secure. This will ease the minds of other investors who are troubled by the recent ongoing uncertainties of financial institutions.
posted on July 17th, 2008 at 2:00 pmIn your letter “Safe Sound and Secure” you state the the LAFCU is “not experiencing significant levels of delinquencies and/or loan losses. Didn’t all the failed financial institutions say the same thing before they collapsed? Your article did little to convince me. I think a more detail explanation is in order, backed up with facts.
I would think that with the C.U.’s expansion of membership to include many people that do not have a real civil service protected job with the City of Los Angeles, the C.U. would be experiencing an increase in defaults do to the widespread downturn in the economy. The popularity of House Flipping seems likely to involve the LAFCU.
I would like to know the numbers on real estate delinquencies as well as other loan defaults, on a comparative basis, encompassing the more recent quarters of the “Sub-prime meltdown”, and the pre-Fire Family era, before you expanded the field of membership.
Thank you
posted on July 18th, 2008 at 9:55 amI very much appreciate and thank each of you for your recent comments, compliments and questions regarding my recent email and posted blog article. We have great members who are deeply connected emotionally and financially to LAFCU.
To the question of why LAFCU chose American Share Insurance, a private insurance company vs. Federal insurance: LAFCU members are quite frankly better savers and more responsible in their budgeting than the vast majority of credit union members. To that end, our savings per member ratio is approximately $28,000 and is around 4 times the national average. It was our intention to provide members a much higher level of insurance to match up with those much higher savings balances consistent with a safe and well run share insurance company. ASI provides up to $500,000 per account type.
We work closely with ASI and, in fact, I am on their advisory council and interact with their senior management team and CEO fairly regularly in order to ensure that their strategic direction and financial condition remains healthy. Please click on the attached pdf to view their financials.
On another note, a member asked what LAFCU’s specific level of delinquency was. As of June 30, 2008, LAFCU’s delinquency ratio for loans 2 months and over stood at .20% and although it fluctuates from month to month, it has not exceeded .56% in 2008. We have expensed more in 2008 for “potential loan loss expense” to be conservative in a challenging economic environment. Another excellent measure of the Credit Union’s financial condition is the year to date and projected net income for full year 2008. To that end, LAFCU has generated over $2 million in net income through June and currently projects a $5 million dollar plus net income for year-end 2008.
posted on July 18th, 2008 at 2:13 pmIt has been my pleasure to be a member of the credit union for over 37 years. I have found that quality people like Mike M. and the board members… are key to this organization. I know many of the “old timers” who have led this association for many years. The integrity of these leaders is what sets us apart. It is good that some of the above comments… asks tough questions. These investors have a right to question…and the leaders have a resposibility to represent the awesome fire family.
posted on July 22nd, 2008 at 10:43 amIt is sure gratifying to hear positive comments regarding LAFCU’s leadership. I must say that this format provides me a wonderful opportunity to acknowledge not only the dedicated and professional work (unpaid I might add) of our current and past volunteer Board of Directors and Supervisory Committee but even more so to comment on the level of integrity, honesty and commitment to our special membership that these men and women bring to this fine financial institution. It has truly been my honor to have worked with them and you for over 28 years.
In difficult economic times, it really gets back to the levels of personal trust and connection that you as a member have with your financial institution. Today, more than ever before the “trust factor” supersedes “rate” as a primary factor in the placement of savings and investment dollars. I am pleased to share with you that LAFCU has taken in an additional approximate $5 million dollars over the past week that underscores that issue. I hear from our members on a daily basis about the high level of trust in LAFCU and am so pleased to share with you that it is that “trust factor” that has and always will guide our decision making on behalf of our “Fire Family.”
posted on July 22nd, 2008 at 2:58 pm