2 min read June 2022 — Consolidation is the name of the game in the credit union and community bank business. In an interview with Invest:, Michael Miller, president and CEO of iTHINK Financial, said there used to be 22,000 credit unions and now there are 5,000, with no end in sight to the consolidation trend as companies need to improve economies of scale.
Why did the company rebrand as iTHINK Financial?
We started the credit union in 1969 as the IBM Credit Union in Boca Raton, Florida. It worked well for the first 48 years of the credit union. However, we realized that most people believed that to be a part of our credit union you had to be an IBM employee. We wanted to have something more inclusive and we decided to change our name to iTHINK Financial, which is still a brand related to IBM’s corporate creed and serves as a nod to our initial roots.
The timing couldn’t have been worse. We had this huge marketing campaign set for March 2, 2020. On March 16, we all know what happened. Surprisingly, our credit union was able to weather that storm with Payment Protection Program Loans and other loans helping our members bridge their unexpected financial emergencies. Our community started to become familiar with iTHINK Financial through those efforts, but we wanted to get out there and expand our brand.
I think it was good that we switched our name; it was much needed, and now I’m excited about what is ahead for us. We have over 100,000 members now with $2 billion in assets, so the growth that we’ve seen has just been tremendous over the last couple of years since we changed our name. You can’t attribute all our growth to the name change, but I think it helps us.
What is your assessment of financial literacy today?
We need an emphasis in our schools on financial literacy. The state of Florida passed legislation that all high-school students should receive financial education to graduate. I think that’s what every state needs to do because the more we interact with people, the more we see that financial literacy is something that isn’t common knowledge to customers. It is not to the level where it needs to be, unfortunately. Many people don’t even know how to balance their checkbooks. Customers need to understand that if they have some financial acumen, then that will propel them and help them to succeed in life.
How is your company leveraging technology to provide a better service?
Every industry is experiencing a technological change, especially in financial services where we even have a new category, fintech. The world has changed over the last two years. We all had to accelerate to incorporate handheld devices and all technology into our daily lives. The way we’re trying to leverage that is to pour our resources into the apps and devices that people can utilize however they want, at their convenience. Our data shows that even though millennials or Gen Z want or do all their business on their mobile or their online device, they still want to know that a branch is right down the street, even though they may never come in. Many people are that way. Besides that, technology adoption has accelerated, much to our benefit because it’s a lower-cost transaction if people are using their device or using technology to do their banking. It means we don’t need to hire a bunch of tellers, although we still want that personal interaction and to make people feel at home and not like a number. Our biggest struggle now is preparing our workforce to personally relate and be able to connect and have a relationship with people in the digital age.
What are your plans regarding mergers and acquisitions?
We never go out and seek a merger or an acquisition, but if somebody comes to us and wants to have that dialogue, I’ll never shy away from it. It always has to be what’s right for both parties. The last two banks that we merged in were just perfect fits for us. The second bank, Oculina Bank, increased our footprint to the north edge of Palm Beach County and up to Sebastian or nearly Brevard County. So, it was just a perfect fit for us. If it’s a good fit and it expands our footprint, then we would consider it.
When I first started in this industry, there were 22,000 credit unions alone. Now, there are less than 5,000. The same thing has happened in the community bank industry. I don’t see an end to that. That’s going to continue just because of the economies of scale and everything that’s involved with this industry. It just makes sense for more organizations to come together.
How do you envision the future of credit unions in the post-pandemic economy?
We’re going to continue to consolidate. The focus must be on our members. At least once a week, I gather my executive team and my chiefs and we discuss what our members want and need and if there is anything we’re missing out on. If you’re focused on your members, your customers and your employees, good things are going to happen. We just want to be able to provide what our members are looking for and what they are asking for.
What is your outlook for iTHINK Financial in the next two to three years?
I’m very optimistic about the future. I think the economy is going to be tough. I think we’re in a recession but we just haven’t labeled it yet because we haven’t had those two consecutive quarters of GDP contraction. There are many challenges ahead of us, but I think there’s no end in sight to how successful we can be.
How do you give back to the communities you serve in?
Our commitment to the community is unmatched! In 2017, we created the iTHINK Community Foundation. The mission of the iTHINK Community Foundation is to improve the lives of children and families in the communities we serve. All proceeds raised in iTHINK Financial branches along with the Kilometers for Our Community Virtual 5k and other fundraising events are donated directly to the Foundation and used to support causes which include: our iTHINK Community Foundation Scholarship awards, school supplies for children in need at our annual School Ready Days and Jingle Bells at the Branches events. The iTHINK Community Foundation Inc. is a 501(c)3 non-profit organization registered in the state of Florida, Registration #CH47200.
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