Banking

How credit unions are helping communities hit by Ida, wildfires

Still reeling from the damage of Hurricane Ida and West Coast wildfires, many credit unions are working to not only reestablish services offered to members but provide emergency relief.

Even in Louisiana, where businesses and homeowners already faced difficulties rebuilding from the devastation of Hurricane Katrina in 2005 and other storms, Ida brought new challenges.

“We’ve been through Katrina as well as other hurricanes, but typically our power was back sooner,” said Jeff Conrad, president and CEO of the $590 million-asset Pelican State Credit Union in Baton Rouge.

Power was restored to the credit union’s headquarters on Sunday, ending the longest power outage it has experienced, Conrad said.

During the outage, Pelican State was “operating our corporate headquarters and all lines of communication to our 19 branches off of a 650 kilowatt natural gas generator,” he said. “No matter where you go right now in this impacted area, there are long lines to get gasoline from those stations that have it to provide it.”

Pelican State Credit Union’s generator-powered ATM provides emergency cash access in areas where Hurricane Ida has left residents without power for an extended period of time.

Residents in Baton Rouge and beyond are using generators to power necessities like refrigerators. With few gas stations open in a capacity to provide fuel, the demand is exceeding the supply.

That’s where credit unions can step in to provide relief, even if many of these institutions are suffering from the same challenges as their members. Many are helping members by forgiving late fees and presenting them with low-interest loans to cover urgent expenses like home repairs and supplies.

In past disasters, Pelican State collaborated with local vendors to distribute supplies like bottled water and hot meals to those in need. It also deployed standalone, generator-powered ATMs to the areas that were left without power for an extended period of time.

Other credit unions, like Tulane-Loyola Federal Credit Union in New Orleans, plan to waive late fees for members who can’t reach a branch to make payments.

“Even the U.S. Postal Service isn’t fully active in all areas yet, including the building that we’re in. So I have no way to accept payments unless they were to come in and hand them to me,” said Eva Kirkman, interim CEO of the $19 million-asset credit union.

In times like these, where physical branches may be closed or operating in limited capacity, credit unions lean more heavily on mobile and online services.

Pelican also works with Scienaptic, a New York-based fintech firm, to increase the speed of credit decisions during crises. Scienaptic uses artificial intelligence to quickly review a member’s credit portfolio during the loan underwriting process and yield a decision for the institution in a fraction of the time that it would take a person to do.

“When we are able to holistically integrate with a credit union or lender and help disburse loans as they are needed in real time, it will improve the lives of both the credit union and the members,” said Pankaj Jain, president of Scienaptic.

How credit unions are helping communities hit by Ida, wildfires

Damage to the drive-up ATM lane at Pelican State Credit Union’s Mid City Baton Rouge branch.

Natural disasters are creating similar challenges for residents in other states.

According to the latest data from the Washington Department of Natural Resources, there were 1,121 wildfires so far this year, surpassing 2020’s full-year total of 878. The burning of debris has been the cause of the largest percentage of all wildfires this year, at nearly 24%.

“In the last two or three years, we’ve seen a lot more wildfires and windstorms, so those programs have been elevated accordingly, ” said Ryan Bernard, vice president of commercial credit and operations at Numerica Credit Union in Spokane Valley, Washington.

The $3.2 billion-asset institution launched emergency loan programs for commercial and consumer members, waived fees for its Skip A Pay program and offered payment deferrals.

“We sit down with each member to try and understand where they are at in order to better help their financial well-being,” Bernard said.

Many credit unions already have experience with helping members in times of extreme hardship. For example, the $4.7 billion-asset Gesa Credit Union in Richland, Washington, has run emergency loan initiatives over the years in response to pandemics and natural disasters.

“Our job as a credit union is to make sure that we are serving the members of the community, so between 2018 and now, we’ve run five or six different campaigns for wildfires, floods, COVID and more,” said Kevin Willborn, vice president of consumer lending at GESA. “With those loans, some rates were as low as 1.99% and others were at 0%, and our goal was to try and help the community. We obviously want these loans to perform, but if they don’t it’s not the end of the world. … As we grow in size, we’re always focused on staying grounded, staying in touch with the community and doing whatever we can to help.”


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