Consolidated FCU's diversified member groups will help weather Consolidated Freightways shutdown, CEO says

PORTLAND, Ore. – Long before the recent shocker that Consolidated Freightways, one of the nation’s largest truck-driving companies announced it had filed for bankruptcy and would lay off more than 15,000 employees “immediately,” Consolidated Federal Credit Union began laying the groundwork to diversify its member groups more than a decade ago. That strategic planning may have helped the credit union buffer industry attrition and shutdowns. “Sure, we’re hearing from members, but we’re not going to abandon them,” said Edward Baldwin, CFCU’s president/CEO. “We have very low delinquency rates and we are well diversified.” Roughly 8% or 1,600 members are Consolidated Freightways employees, Baldwin said, and the credit union is ready to assist members with their financial needs during the truck-driving company’s upheaval. He would not provide specifics on how the credit union plans to assist members. Consolidated Freightways said it would shut down its U.S. operations after 73 years and file for Chapter 11 bankruptcy protection. On Labor Day, the company said about 15,500 employees would be affected, with more than 80% receiving termination notices immediately. The remaining supervisory and management positions “will be phased out quickly.” Originally chartered in 1954 to serve Consolidated Freightways, Baldwin said the credit union began expanding its field of membership more than 15 years ago through a series of mergers with smaller credit unions and through divestiture by Consolidated Freightways and CNF Transportation and their related operating companies. Today, the credit union has 150 select employees groups with the Freightways company being one of a few large employee sponsors, Baldwin said. Baldwin emphasized that the credit union’s standing is strong and well diversified enough to continue business as usual. The credit union has more than 20,000 members, $112 million in assets, two branches in Oregon, one in Washington and South Carolina. In a letter to Consolidated Freightways employees, company officials said, “we expected that recent discussions with our banks, other lenders and real estate investors would enable us to obtain significant additional financial resources. “Unfortunately, this has not been the case.” The Vancouver, Wash.-based company lost $36.5 million on $463 million in revenue in the first quarter of this year, according to company filings, and lost $104.3 million last year. It has 350 terminals and 30,000 trucks in the United States, Canada and Mexico. Operations of the company’s CF AirFreight and Canadian Freightways Ltd. subsidiaries were not affected. -