Credit union plans to close Delano branch
| Saturday, Sep 04 2010 12:15 AM
Last Updated Saturday, Sep 04 2010 12:15 AM
Kern Schools Federal Credit Union announced Friday that it plans to close its Delano branch Oct. 6 in another move to cut expenses amid rising loan losses and a decline in borrowing.
All but three of the location's 15 employees have already been placed elsewhere within the credit union, said Steve Renock, president and CEO of Kern Schools, the county's largest financial institution. He said the closure is expected to save $700,000 a year in facility costs alone.
"In these tough economic times, you have to make very difficult choices," Renock said.
The branch has long operated at 1101 Cecil Ave. in Delano, where the credit union has as many as 15,000 members, or about 8 percent of Kern Schools' membership. While the nearest alternative branch is in Bakersfield, the credit union's customers will continue to have access to a Kern Schools ATM in Delano, as well as online and phone-based banking, Renock said.
Although no new lease has been signed, Kern Schools probably will be replaced at that location by Bakersfield-based Safe 1 Credit Union, which has about 5,000 members in Delano and would relocate from a smaller branch about two blocks away.
"It'll be a real easy move for us," Safe 1 President and CEO Doug Kileen said.
"We hope to be able to serve some of those people that were currently served by Kern Schools," Kileen said.
Renock said that's fine by him, and added that the Delano branch was among the slowest by transaction volume in the credit union. "Obviously that was part of our decision," he said.
Branch employees were notified of the decision Friday, the same day letters announcing the change were sent to credit union members.
The move comes less than a month after Kern Schools laid off seven employees, including one vice president.
Renock said the credit union had little choice but to cut expenses. Kern Schools lost $16 million in the first half of this year, following a $40.6 million loss in 2009.
"We can't make people buy cars or borrow, so the only thing we have control over is our operating expenses," he said.
