If you ask Lee Williams what is behind the success of Central Star Credit Union, she’ll probably tell you it’s adversity.
Williams, president of the $68-million-asset credit union, said Central Star was on track to diversify its membership and business when the worst recession since the Great Depression accelerated those plans.
“It’s been get on and hold on,” Williams said.
Central Star was founded in 1940 by 10 employees of the former Beech Aircraft Co. And up until seven years ago, the credit union served Hawker Beechcraft employees and their families exclusively. Previously known as the Aviation Associates Credit Union, the entity knew it needed to expand its membership criteria to grow, Williams said.
So it changed the criteria to allow everyone in a five-county area – Sedgwick, Butler, Harvey, McPherson and Saline – to become members. It also opened a grocery store branch in the former Homeland grocery store at 21st and Amidon and changed its name to Central Star.
The Homeland branch allowed it to attract a new demographic: Hispanic customers. It’s a group that even since the closing of the grocery branch remains well represented within Central Star’s membership.
“That was very advantageous,” Williams said.
Then the recession came, accompanied by layoffs at Hawker Beechcraft and other companies. Those layoffs and a prolonged downturn weighed on the credit union, she said. It wrestled with delinquencies and repossessions, historically low interest rates and increased regulation. And, Williams said, it couldn’t turn away from its Hawker Beechcraft members who were struggling too.
So it restructured, centralized its lending decision-making and moved ahead with launching new products. A new, for-profit company called Central Star Financial Services, which provides insurance and mortgages, was created.
That new business, in particular, offset a dramatic decline in interest income, she said.
“It shored up our bottom line within 36 months,” she said. “We are a stronger organization with a brighter future.”