News of recent bank failures and the weakness of the banking industry and sub-prime mortgage problems has resulted in some members inquiring about the security of their accounts. In response to your inquiries, we’re pleased to say that your money is safe at The Ohio Educational Credit Union (OECU). Here’s a brief overview to ease your concerns about today’s current financial climate.

Our Primary Purpose

We exist for the purpose of assisting our members in enhancing their financial well being by providing financial services including deposit and loan products. We’re a not-for-profit financial cooperative owned by our membership. We don’t have shareholder pressure to make profits by taking excessive risk, as do some banking institutions.

OECU has never pursued risky sub-prime loans. We’ve never varied from our primary purpose of enhancing the financial well being of our membership.

Financial Strengths 

Our financial position is strong, with a capital to asset ratio in excess of 11% and a liquidity ratio in excess of 28%.

We don’t originate real estate loans that would be considered “sub-prime”. Therefore, we don’t have direct exposure to credit losses associated with “sub-prime” real estate lending. Any delinquent loans and loan losses we experience are considered normal by regulatory standards and we haven’t experienced any significant increase in delinquency like many other financial institutions. We use conservative lending practices, which means there are occasions when we decline a member’s loan request, but this has proven to be good for the overall membership.

We continue to maintain a well-balanced and financially sound loan portfolio. Our portfolio contains 37% closed-end mortgages, 28% collateralized loans such as new and used vehicles, 24% home equity loans, and 10% signature based products such as credit cards. Of our real estate loans, 97% had at least 20% owners’ equity in the house at the time the loan was made.

Monitored and Regulated

We operate in a closely regulated industry. We are regulated by the State of Ohio, Department of Commerce, Division of Financial Institutions. We continue meet or exceed the expectations of the State examination process.

Our Board of Directors utilizes an independent CPA firm to perform an annual audit. We’ve consistently received an unqualified opinion, which is the best rating a company can obtain. A copy of our 2007 Annual Report is available at any OECU office or here online.

OECU utilizes American Share Insurance (ASI) for deposit insurance up to $250,000 per account. This deposit insurance is only available to credit unions that meet a strict set of financial guidelines and maintain strong operating practices. ASI regularly performs insurance reviews to confirm our compliance with their underwriting guidelines.

We’re proud of the financial services we’ve provided to our membership for over 75 years. We’ve consistently returned exceptional value to our members and will continue to utilize conservative practices to meet our purpose of enhancing our members’ financial well-being.

I hope this review of our safety and security measures helps reinforce the confidence you’ve already placed in The Ohio Educational Credit Union. If you have any further concerns, please contact myself, or any member of our executive management team. You can call 216-621-6296, ext. 3073, or email your questions to OECU_officer@ohioedcu.com.

We’ll be pleased to discuss this issue or any other Credit Union related topic. Thank you for your membership and support.

Jerome R. Valco
Chief Executive Officer

Robert C. Becker
Chief Operations Officer

Arthur D. Boehm
Chief Financial Officer