A Message from Mark Hawkins, Altura Credit Union CEO
From Altura’s 2011 Annual Report
Dear Members,
The year ending Dec. 31, 2011 marked a significant turning point for Altura Credit Union. Not only did we end the year with positive net income of $8.43 million, we also recorded 10 consecutive profitable months to close out 2011. This trend continued into 2012. We have already seen Altura post its best quarter in our 56-year history with net income of $7.04 million for first quarter 2012.
Getting here hasn’t been easy, as anyone living and working in the Inland Empire knows. Like many of you, Altura faced its share of struggles since the “Great Recession” began at the end of 2007. We repeatedly had to reduce our costs of operation. Those measures, some severe, were necessary as loan losses mounted, while revenues, primarily from Member loan activity, ground to a halt. During an economic crisis, understandably people are simply averse to borrowing money.
With our focus on the long-term needs of Members, Altura had to make some difficult choices, as did many of you. Few areas of the country were hit as hard as the Inland Empire. Unemployment rose to 15 percent, and following the job losses, home foreclosures soon followed. In response, Altura had to set aside reserves to cover those losses. This led to more cost-cutting and the cycle continued.
In 2011, with economic threats still evident, we further reduced our costs. We combined our two Hemet branches into one, closed the Moreno Valley WalMart branch, and converted branches in Murrieta, Temecula and Riverside (University Avenue) to electronic only. Subsequently, Altura removed the ATM from University Avenue, and sold the Temecula branch to a North Carolina-based bank in a 2012 deal. We also closed our affiliate mortgage company and sold our affiliate insurance company. However, we continue to provide mortgage and insurance products and services to our Membership through new relationships we have formed.
With these tough choices and recovering market conditions, we expected things would improve in 2011, and they did. From second quarter 2011 forward, Altura returned to profitability. A loss of $5.8 million in 2010 was reversed and replaced with a gain of $8.4 million in 2011. Our difficult decisions paid off, and the benefits are continuing into 2012. Our net worth ratio has increased from 5.70% a year ago, to 8.46% at the end of April this year; a remarkable turnaround.
In fact, things have improved so much, that we have re-staffed our Murrieta location and returned it to a full-service branch. We are thrilled with this result and delighted to once again be active in the southern portion of the county.
Although the Inland Empire’s recovery remains slow, we believe the worst is now behind us. Unemployment persists as a regional and national problem, but the local housing market is stabilizing. Accordingly, we’ve been able to reduce our provision for loan losses substantially. We have even seen an increase in loan demand (slight though it may be) for new and used automobiles, and this is promising.
None of this would have been possible without the support of YOU, our Members. We are very proud of our 56-year history of serving the Inland Empire and look forward to doing so for many years to come. Thank you for your ongoing support and loyalty. We look forward to serving you and helping you once again achieve your financial hopes and dreams.
Wishing you all the best,
