Michael N. Lussier
Title: President and CEO, Webster First Federal Credit Union
Age: 54
Experience: 32 years
Mike Lussier jumped into the credit union industry from the banking world in the mid-80s and hasn’t looked back. He joined Worcester’s Webster First Federal Credit Union as its CFO in 1987 and took on the role of president and CEO just three years later. He’s also broadened his influence beyond the Bay State, lobbying fiercely for the credit union industry at the national level. When Lussier isn’t advocating for his industry or educating other financial institutions about coming compliance issues, he enjoys hunting, fishing and flying.
Q: Can you talk about Webster’s recent merger with Industrial Credit Union and how that fits into the broader context of consolidation you see happening in the industry already?
A: It is definitely an opportunity for Webster Credit Union. If there’s going to be a merger potential, I’m hoping I can at least be a potential merger partner, but in all honesty, I’m a credit union advocate, 100 percent … We here at Webster Credit Union would rather assist and help the smaller credit unions survive than to say “Look, we merged with another one.”
The industry has grown tremendously in members and in assets, but the number of institutions has come down because of mergers, acquisitions, failures and so on. When you’re sitting in front of Congress, it’s nice to say how many people in the community you’re serving, but it’s also nice to know that you have the backing of 12,000 credit unions as opposed to 6,000.
It’s easier to sit there in front of Congress and say, “We’re representing this amount of people,” but it hurts when I say I’m only representing 6,000 companies.
So it is more critical for institutions of strength such as ours to support the smaller credit unions to survive than to just sit there and be the big boy on the block. We’re not here to be the big boy on the block, but we’re here if there’s an opportunity to assist another credit union in surviving.
Q: What would you say are the top challenges facing the industry today?
A: I sit on multiple boards across the country and the biggest topic that comes up right now is the cost of compliance and regulatory affairs, the issues with the CFPB, and the issues with TRID and mortgage underwriting. The biggest issue is the cost of carrying on the compliance issues that are being sent out every day.
Aside from the regulatory compliance issues and the legislative issues, the CFPB is coming out with all kinds of mandates and oversight of things, so that’s another costly thing for smaller credit unions.
One of the most recent items coming into play is the change in interest rates. The change in interest rates is going to hurt the margins of some institutions. A lot of credit unions and banks have extended the maturity of their portfolio beyond the norm. Fortunately, we have a diversified portfolio – between real estate loans, commercial loans, consumer loans, auto loans, motorcycle loans – our mix is blended. A lot of credit unions have needed the additional revenue because of the additional costs, so they’ve extended their mortgage and their loan portfolio further than they wanted to. They’ll be stuck at those lower rates, earning the lower rates for longer than what’s needed, and they’re going to need to pay higher on their savings and their certificates in a shorter period of time.
So the asset-liability mix is extremely messed up for many institutions and they’re not ready for it. I can see it in some of the reports that I read online and I often look at the asset liability mix of all my competition. I think what you’re going to find is a very tight squeeze on earnings for some of the smaller institutions, which will force another potential stream of mergers or failures in the country.
Q: What’s ahead for Webster First in the next year?
A: We’re looking at the new technologically-enhanced branches, with fewer people and more technology in the branches. We’re looking at that more in the Boston area.
The ICU branch really opened our eyes in the center of Boston. We had Filene’s Credit Union in the center of Boston, but it wasn’t in the proper neighborhood and we didn’t have the right traffic. By relocating and being able to establish a foothold with a $180 million company on Liberty Square, I think that allowed us to definitely open our eyes and advance further into Boston.
We’re hoping to reach out into the Faneuil Hall area and work with the multiple businesses in that district. … We presently have about $30 million worth of business loans in the Faneuil Hall and North End district, and we just allocated another $30 million to be set aside for that district in 2016 and ’17.
I think it’s pretty much the Suffolk and Essex area that we’ll be expanding into and really keeping an eye on the Middlesex area. That’s our future expansion plan.
Lussier’s Top Five Flying Experiences
- Flying New England and New York
- Flying to Martha’s Vineyard and parking the plane on the beach
- Experimental flying, like a PT 227 pilot trainer from the 1940s
- Eclipse 500 jet
- Renting an airplane in Florida and flying over Alligator Alley in Key West
