Billion Dollar CU CEO Compensation Casts Shadow on CUs

My jaw literally dropped when I visited www.cutimes.com and learned that the CEO of $1.6 billion asset Portland Teachers Credit Union earned $1.6 million in salary and bonuses last year. Have I just awakened from a Rip Van Winkle experience? When did credit union CEOs start making these bank-like earnings? Does the interesting juxtaposition of numbers indicate a new way of determining CEO compensation? Since the CEO of a $1.6 billion asset credit union makes $1.6 million, does this mean that the CEO of $20 billion asset Navy FCU makes $20 million? Using this formula, I can now guess about other credit union CEO’s compensation. Multiplying the assets of the 100 largest credit unions yields a combined CEO compensation of nearly $200 million. Now we are talking some serious money. According to the Credit Union Times article, the Portland Teachers Credit Union’s Board Chairman said the CEO was worth it. I’m in no position to argue about that conclusion. Besides, this is America, you can charge whatever the market will bear. Certainly, there are bank CEOs that make this kind of money. I am, however, genuinely concerned about how this “lavish executive compensation,” as described by the Oregon Register-Guard newspaper article quoted by Credit Union Times, will play in front of a congressional committee or at the local statehouse. Credit unions are unlikely to receive as much sympathy from elected officials who sacrifice their own potential private sector earnings for low paying public service. How do rank and file credit union members react to this news? It will certainly be laughable to refer to the “credit union movement” as a social cause with so many millionaires among us. In the public view perception becomes reality. Methinks we quack more and more like a duck. Marvin C. Umholtz President & CEO Umholtz Consulting Services Castle Rock, Colo.