Las Cruces banks adapt to ‘new normal’ during COVID-19
LAS CRUCES – As the country’s economy continues to struggle to find its place after the near-national shutdown during the COVID-19 pandemic, banks and credit unions continue to adapt while helping customers and members through uncertain times.
In accordance with New Mexico’s Home Support Order, state financial institutions have shut down lobbies, relied on online banking and mobile apps, and provided in-person services. via drive-thru lanes. Some have used ITMs – interactive banking machines – to provide a face-to-face experience while mitigating the risk of the virus spreading.
While the future of the financial sector remains unknown – even to those who watch it closely – industry executives told the Las Cruces Soleil-News they remain committed to ensuring safety and finding solutions during the outbreak.
Stepping up of sanitation measures
In order to safely open lobbies to customers, banks and credit unions have been forced to think about how to mitigate the spread of the pathogen. This includes installing plexiglass barriers between cashiers and customers, frequent disinfection of frequently touched surfaces, and implementing social distancing practices at branches.
“We had cleaning crews coming in and cleaning things up,” said Ron Moorehead, general manager of First Financial Credit Union, which operates branches throughout New Mexico. “We wanted things to look good, but we didn’t think too much about disinfection. It’s changed. At the end of February, when things were not going well in China, I asked the staff at our facilities to start stocking up on hand sanitizers, masks, gloves – whatever we might need. “
During a regular flu season, First Financial offers hand sanitizers to its members.
“We used to do a lot of disinfection beforehand, just because of the regular flu,” Moorehead said. “At first we had a hard time getting things. But then when the distilleries and things started making disinfectants, we were able to get a lot of it. “
Staff are trained to frequently disinfect surfaces, he said.
“Now we have staff assigned to cleaning the door handles and surfaces as needed,” he said. “Gloves are only practical for one-time use. Rather than going through a billion gloves, we’ll ask staff to disinfect frequently, so that it doesn’t spill from member A to member B. We’re going to wipe things up; it can be every hour. It could be more often.
Right now, drive-through cans are sanitized between member visits, Moorehead said.
“The problem with this disease – from what we know – is that it is quite susceptible to lower level disinfection. It’s not like MRSA, or anything like that, ”he said.
Meanwhile, at Pioneer Bank sites around Las Cruces, administrators were taking similar action and awaiting the arrival of plexiglass barriers, according to executive vice president / Las Cruces market president Kiel Hoffman.
“To make our employees feel more comfortable, we will have plexiglass screens at every checkout station and at every office,” he said. “We ordered them, but were told they were late but would be there next week,” he said on May 14. “We went out and found masks, which seem to be getting more and more frequent.”
While hand sanitizer was easier to acquire, Hoffman said surface sanitizers were more scarce.
“Even, as we prepare to open our halls, we’re trying to remove whatever customers usually touch and push – just to reduce the amount of stuff we have to clean,” he added. “I think we’re going to have to spend a lot more time and money on this stuff.”
Refinancing varies by institution
Many New Mexicans have taken advantage of historically low interest rates to refinance their home loans, Moorehead said.
“I see a lot of people refinancing their mortgages,” he said. “We had to send a lot of people to this team who weren’t there before.”
Hoffman, on the other hand, noticed it less among Pioneer Bank customers.
“The world’s investors are definitely tightening their grip,” Hoffman said. “So the minimum credit scores, the maximum loan-to-value ratio – that sort of thing is all tightening up during that time. It is starting to get a little harder to refinance. And if you want to cash out, I think it’s even more difficult these days.
However, the bank’s housing construction department maintained stable activity throughout the crisis, he said.
“We are a major construction loan lender here in Las Cruces,” Hoffman said. “And our numbers are strong and big. They’re still building houses, which means they’re still selling houses. Over the past three months, our mortgage loan officer has had good numbers, even with stricter rules. “
Lowest interest rates
Moorehead believes members might be wary of low savings rates, causing them to pay off debts or invest their money elsewhere.
“People are going to save, but they’re going to be a little irritated by the savings rates – because the savings rates are going to be stupidly low. Not just low, but stupid low. I don’t think the Fed will go for negative interest rates. But, it will be a good time to be a borrower and a horrible time to be a saver. Savings rates aren’t going to go up anytime soon.
Moorehead also suspects that historically low interest rates will push used car prices down.
“When you have zero percent interest in new cars – just good deals – the prices of old cars will drop,” he said. “Why buy a three or four year old car – and finance it for up to five years – when I can literally buy a brand new one with more bells and whistles that delivers better fuel economy for the exact same monthly payment.” ? If you try to sell a used car over the next year and a half, the market just won’t be there.
Uncertainty leads to hoarding
Moorehead said many members of the credit union were hanging on to their stimulus payments.
“We went from a $ 600 million credit union to a $ 650 million credit union – an increase of about 10% – in the space of three weeks, when it all started and the funds Stimulus have started to arrive, ”Moorehead said. “He came in and he’s still there. He’s not gone.
Hoffman said Pioneer Bank has prepared for customers who have cash or are looking to withdraw large amounts during the pandemic.
“We prepared for hoarding, but we still haven’t seen it materialize,” Hoffman said. “At the start of it all, we had people coming in and looking to withdraw large sums of money, but our employees are well enough trained to convince them that this is not a safe thing to do – for many reasons. . It is not safe to have it in your house; it is not safe to leave a building with it. To put it simply, if you are subject to FDIC guidelines, you have nothing to worry about.
Spending versus saving
Hoffman told the Sun-News he believes that “a vast majority” of Pioneer Bank customers spent their stimulus payments shortly after they were deposited into their accounts.
“I would say the majority spent them,” Hoffman said. “We have seen our ATMs empty much faster in those two weeks. So I think people spent it. I’m not sure many people saved him.
In the end, Pioneer Bank only had one customer who walked out “just demanding a large sum of money,” Hoffman said.
Moorehead’s experience at First Financial was different, he said.
“We watch sweeps – when our members use credit or debit cards to buy something, whether it’s at the grocery store or online,” he said. “We get what is called ‘interchange revenue’ from it, which helps pay for the cost of merchant expenses. But we see a drop of about 15 to 20% of these, depending on the day. “
Both institutions have seen a sharp increase in the use of online banking services and mobile apps during the pandemic. At First Financial, mobile banking is up 15%, Moorehead said. To accommodate the closure of the Pioneer Bank lobby, the bank has extended the hours of operation of the drive-thru. Pioneer even opened new accounts via drive-thru, Hoffman noted.
Clearly, in these uncertain times, the experience of every financial institution is as unique as the clientele it serves – and no one seems to be able to predict where the financial recovery will lead.
But Hoffman believes community banks deserve credit for stepping up to help communities in these difficult times.
“Even though our employees weren’t working 40 hours a week, we’ve been paying them for 40 hours,” he said. “And I see the (payroll protection program) as one way the banks were able to give back to the community. I’m quite proud of the community banks, which stand up and help – not just their own customers – but also the customers of other banks. We have been able to help a lot of people, and the community banks are to be commended for that. “