An eye on the financials

The impact the current economic environment has on credit risk and how artificial intelligence (AI) will impact members are two challenges that Casey Kucera, chief financial officer at $754 million asset Jefferson Financial Federal Credit Union in Metairie, La., and member of the America’s Credit Unions’ Finance Council Executive Committee, is paying close attention to.

She offers insights into those and other challenges in the year ahead.

America’s Credit Unions: What are you focusing on at the credit union?

Casey Kucera: Deposit growth and member retention remain top of mind for us. The focus is on strengthening relationships with existing members and gearing new product development toward meeting their needs. To that end, we believe reducing friction in the process—whether that be through process improvement or digital enhancements—is key to attracting and retaining member relationships.

Q: What are the biggest finance-related challenges you’re facing?

A: Liquidity has proved our biggest challenge. Despite continued internal emphasis on deposit growth and retention, our members have felt the effects of rising prices and have increased spending. As a low-income-designated credit union, we’re feeling these pressures more acutely.

Additionally, with the record-long sustained inversion of the yield curve, margin pressure has been a continued challenge for us.

Q: What challenges do you see on the horizon?

A: Broadly, heightened interest rates, elevated consumer debt, and inflation present potential credit risk to the industry. Coming from a level of sustained near-zero interest rates, followed by stimulus and record-low charge-offs, my concern is the impact to the credit union’s credit losses. The challenge is magnified by the implementation of CECL, which has the potential—by way of its volatility—of causing risks to earnings.

AI is something else we’ll want to monitor. While AI’s rapid advancement presents several opportunities, it’s not without its challenges. As the credit union industry takes advantage of AI, we should pay close attention to its impact on our members.

Q: What opportunities do you see for 2024?

A: Leveraging technology is always interlaced into our strategic initiatives. In 2024, we’ve highlighted a number of areas specific to finance where we can improve our processes through automation.

Our goal is to capitalize on existing and evolving technologies to improve our efficiency and effectiveness to make the most of our team’s valuable time. We know that the time and resources we invest now will have rippling impact to future improvements.

On the loan side, we’re implementing enhancements geared toward reducing friction in the application process for small business members. We see much opportunity in serving this group of businesses with fewer hurdles and with loans that aren’t necessarily offered by other institutions.

Q: What advice do you have for young finance leaders?

A: My advice for anyone looking to grow their finance careers is to be open to opportunities that come your way. Be willing to take on new projects and show your skills, and don’t shy away from the chance to work on cross-departmental teams.

There’s so much to be learned from our colleagues across the credit union—not just those in the same functional area. If possible, find opportunities to network with peers at other credit unions, whether through the state league or through the Councils program.

I’d also recommend finding leaders you admire and learning from them. Ask them questions and listen. Ask them what books they’ve read that have shaped their leadership mindset, and read those. Whether those mentor relationships are formal or informal, you can never have too many mentors.

Lastly, I’d encourage those looking to grow their finance careers to focus on and hone their ability to think strategically and to embrace empathy— an attribute I consider key to becoming a successful people leader and influencer of change.