CEO David Desjardins leads Acadia FCU to prosperity
PHOTo / Ken Lamb
David Desjardins, president and CEO of Acadia Federal Credit Union, says Acadia's growing commercial loan portfolio represents the credit union's commitment to serving its members.
David Desjardins doesn't have anything against technology; he just prefers to conduct business face-to-face.
So when one of his members — credit union terminology for a customer — gets behind on a mortgage payment or a commercial loan, he grabs the keys to his Volkswagen CC and heads to their home or office.
"Yes, I am very hands-on," says the 48-year-old CEO of Acadia Federal Credit Union. "You can get a lot more accomplished when you talk to someone face-to-face and figure out a way to help them than you can sending them a letter or calling on the phone."
That premium on personalized service has stood Desjardins well over the 10 years he's served as CEO. When he took the reins in 2004, the credit union membership stood at 4,000 with assets of $32 million. Today, the Fort Kent-based credit union counts 10,500 members and assets over $115 million.
Even more impressive, the credit union's consumer lending portfolio grew 5% each year since 2007, despite the recession, job losses that clobbered Aroostook County's economy and increasing federal regulations. That portfolio performance was matched by only 10 other credit unions in the country — out of a pool of 2,200 — according to a 2012 study by the Filene Research Institute, a think tank for the credit union industry.
"It's undoubtedly a testament to exceptional management and leadership," says Filene researcher Ben Rogers.
The accolade is nice, says Desjardins, but he prefers to measure the credit union's success in other ways. In 2011, Acadia FCU gave members a 7% rebate on dividends and loan interest, which translated to approximately $350,000 in funds returned to members. (As a not-for-profit financial institution, the credit union can return unspent revenues to its membership). And despite its far-north location, it leads the state's credit unions in the number of commercial loans it originates.
"Yes, I suppose you wouldn't expect that," Desjardins says with a chuckle.
It might be surprising to someone outside The County that business loans are booming, but it's old hat to Desjardins who initiated commercial lending when he took over as CEO at the credit union following many years as a volunteer director. Establishing and growing a commercial lending division was essential not only to the growth of the credit union, but for the economic well-being of the area.
"We got into commercial lending because the credit union needed to diversify," he says. "There is lots of competition for car loans and mortgages, but not for commercial lending. Our commercial customers are logging companies, carpenters, farmers, where a typical loan is between $50,000 and $100,000. Bigger banks scoff at that. And we do lots of smaller loans — $10,000 to $20,000 — that bigger banks won't touch."
Acadia FCU's commercial lending portfolio is the fastest-growing part of its loan portfolio, growing 21% from 2011 to 2012, representing a net growth of more than $2.3 million.
"We found a niche market that bigger banks don't bother with — they can't make money with them," he says of the small business loans. "But we've done enough volume of these loans so we're very good at it; we are an experienced commercial lender."
The commercial loan portfolio not only diversifies the credit union's revenue stream, it also dilutes risk.
"If you have one $300,000 loan and it goes bad, it hurts the portfolio," he says. "But the chances of 10 $30,000 loans going bad are pretty slim."
Hometown roots
Desjardins brings to his work a pretty intimate knowledge of most of the local industries. He was born and raised on a potato farm in Fort Kent and has lived most of his life in the St. John Valley. After graduating high school, Desjardins got a public accounting degree from Husson College in Bangor and then landed a job at the Fort Kent hospital. After four years, he was promoted to controller and pursued a master's degree in business by attending night classes at Husson.
After 10 years with the hospital, Desjardins was hired by Daigle & Houghton, a Fort Kent heavy equipment dealership that serves many of the logging and trucking companies of northern Maine. It was in this post where Desjardins learned the ins and outs of those industries — how they make money, where the margins are, the importance of commercial loans and the competitive challenges they face daily.
"I experienced life on the other side of the table first, so I can bring a sales perspective [when assessing a commercial loan application]," he says. "I know how things are selling and their business models. I know how much they are earning and whether they can pay for those new vehicles."
His heavy involvement in community service keeps those connections growing. Last year the credit union staff logged 1,000 hours of community service and donated $20,000 to local organizations, including the Maine Credit Union League's statewide Ending Hunger campaign. Nearest to his heart, though, is a financial literacy project he launched with partners at the University of Maine Fort Kent. Desjardins sought and received a $12,000 grant from the National Credit Union Foundation to establish a financial literacy program in 12 schools within four districts. The initiative earned a national governance and partnership award from the Credit Union National Association.
Growing by leaps and bounds
While his hometown roots means he knows just about everyone in Fort Kent, Desjardins has been widening his circle of acquaintances following three mergers since 2006. The first, the La Vallée Credit Union in Madawaska prompted the name change from Fort Kent Federal Credit Union to Acadia, and doubled the assets and membership. It was followed by a merger with a credit union in St. Francis in 2007 ($1 million in assets) and in 2012 with a St. Agatha credit union ($15 million in assets).
The latter two mergers were nudged by federal regulators concerned the small operations would fail because of dwindling assets and increased costs related to compliance and overhead. But Desjardins saw the mergers as a way to strengthen member services.
"If you look at the future, and at what members demand in terms of technology, benefits and products you realize if you are a smaller credit union and can't afford to offer members those services, those members will go elsewhere," he says. "I realized if we could all join forces, we'd be stronger and our members could get the services they need."
Within the last year, Desjardins introduced new technology-related programs to boost member services, including the Kasasa rewards checking program and a mobile banking app. He's also brought Acadia FCU into social media networks through Facebook, Twitter, YouTube and Pinterest.
While acknowledging the potential for greater efficiency and reduced costs in delivering banking services electronically, he's not about to abandon the bricks-and-mortar branches that still serve customers and foster a sense of community in St. John Valley. Desjardins concedes he could reduce Acadia expenses by closing the St. Agatha and St. Francis branches, but he's loathe to consider it.
"Absolutely it's expensive to keep those branches open, but we are member-owned and here for the service of those members," he says. "If we as managers can figure a way to keep those [branches] open — even if it just breaks even — we'll do it."
Plus he knows the conditions of the roads linking Fort Kent to the other St. John Valley communities.
"A lot of our members are elderly and I wouldn't want them trying to make that 20-mile trip from St. Francis in the winter," he says. "Like I said, it's all about taking care of members' needs."
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