Some Observations on FICCO’s 56th General Assembly March 2011

This year’s overriding theme for another promised historic general assembly was “Blazing the Trail for One Coop, One Vision, and One Nation”. And indeed FICCO has been all that and more. But certain incidents leading up to the assembly date also promised to mark the event as another boisterous event. Chief among them were the now open enmity between certain members of the board resulting in reported shouting matches, laced with serious charges and countercharges; and the falling out of the credit union from the supported partylist, Ating Koop, culminating in the board’s resolution to break away completely from it in spite of the millions of pesos of credit union funds sunk into the effort. And this latter issue has splintered the board into two warring factions, making things look like we are witnessing fierce proponents in some private for-profit enterprise rather than in a credit union famed for its noble purposes of service and volunteerism. Thus, the date came with great anticipation for many members, especially those belonging to the main office.

This is a personal assessment of the whole affair, if only to tie together all the disparate parts. Only this time this will be less about the performance of the credit union which continues to score historic points, but more about the troublesome pressure points rocking the management level of the organization which have patently distracted the elected officers from their primary tasks of steering our huge ship in a singularly focused manner.

This is no technical analysis, or any serious treatise, but rather a randomly compiled narrative depicting how an observant layman member perceived the whole process and had then decided to reduce the experience into print.

To begin thus, this member observed the registration process with a general nod of approval. Attendance was very inspiring. Even with my early arrival of 15 minutes before 10am which was the scheduled start of registration, a sizable number of members of the main office were already in a bit of frenzy jockeying for positions in the many lines assigned. The actual assembly was scheduled for 12 noon but this member had decided to register early expecting an easy sailing and then just come back for the assembly itself. There were 3 lines for senior members bursting with grey-haired members eager to register and receive their package. The only damper was the realization that even for those clearly advanced in age crowding in lines was still in vogue. People still pushed with their bodies and blurred lines like there was a life-threatening emergency that they wanted to get out of in a hurry. Missing was the deference and orderliness that one expected from those more experienced in life.

Anyway, when my turn came it went fast and easy. With package in hand, I was out of there in a jiffy, drove out quickly to do some shopping, and then went through the material given at home. Now, the thick booklet that comprised as the main document of the package, loaded with all the financial statements and tons of critical information which compressed an entire year operation, ought to be given earlier so serious members get ample opportunities to pore over them, rather than cram during the harried time they can scarcely allocate after registration and before actual deliberations. Only a well-informed body can be expected to participate seriously in deliberations of this serious nature. And of course, a well-informed body makes for a more efficient and expeditious discharge of the many businesses attendant to an annual assembly.



Anyway, I was back inside the assembly site at past 12 noon half-expecting an assembly already underway. Thus quickened my pace to the cavernous auditorium to find an amply filled place, though the bleachers looked mostly vacant. But an assembly nowhere near being started. After a quick query from a staff member, I was told it could start any time. It eventually started before 2pm. Being on time has always been a problem with Filipinos and this event was no exception.

While the electric atmosphere commenced early during the readings of the various minutes of the previous assembly, the heat really elevated when the various resolutions were brought to the floor. Thus when the fireworks started was when one had fertile ground to mine for commentary.

And that was when the noise pollution was ramped up, where speakers using highly-sensitive microphones already turned up to full volume, bellowed with their speeches in very high decibels filling the entire place with what could be judged as like noise pollution. With impassioned speakers sounding like self-justified aggrieved parties, throwing both charges and ad hominems against their perceived tormentors. One was made to believe that there was a private confrontation between two factions, unmindful not only of their high calling as elected officers of a credit union but also of the fact that the general membership had little to do with the private wars being waged. Matters that would be better served if discussed and resolved privately, or within the confines of a smaller group like say in a board meeting.

And the irony in this was that recurrent mention was made of both democracy and representation. Justification was made for all this washing of dirty laundry in public as sterling signs of a democratic process and of representative democracy. But in my humble judgment it was neither democratic nor representative.

While granting that the democratic process can be messy and chaotic, the greater issue to remember is that while people can and will always disagree on issues, they need not be disagreeable in the process. We should always defer to ethical standards and show circumspection as a sign of respect to the subject of our tirades and especially to those ears that cannot help but to grudgingly listen to them being captive audience.

And it cannot be truly representative if discussions are hogged by a very select and small number of members and officers. But that was what happened, when turns at the microphones and the floor were exchanged only between the same people over and over again. It should be the task of the moderator to spread around the discussions to as many members as possible. That’s one way of assuring that brainstormed ideas are truly representative of the entire assemblage and not just of a small vocal group who cannot help themselves from speaking out at every occasion that turns up.

But in spite of all the bluster, this corner feels that certain issues which should have deserved more exposure were skirted and glossed over because maybe they did not advance the self interests of those concerned. I refer specifically to the attempted politicization of the organization as epitomized by the officers’ devoted attention to and avid encouragement of the partylist participation which ended in a most disappointing and expensive lesson for the credit union. Though a “timeline” was detailed in a newsletter that resulted in disbursements that totaled over 11 million pesos, this corner did not hear any more clarification from any of those board members who took great pains and efforts to push this agenda to the general membership, a general membership that looks to them for guidance, knowledge, and especially wisdom in the conduct of union affairs. Albeit the millions in losses, the preferred treatment had been that of silence from those directly involved. Where is the owning up and taking responsibility part for those who presented themselves as honorable and transparent guardians of union funds and affairs? I left during the waning moments of the assembly, which was past 5:30pm. Was this issue inserted during those moments? Like the typical late Friday afternoon press releases resorted to by scheming political administrations bent on going under the radar regarding some issues?

First of all, where is the wisdom in having the credit union engage actively in partisan politics, in a reality where politics is inherently judged to be corrupt and divisive? In a series of moves toward this end, one sensed that the union was not only designing itself in order to curry political favors, but to position itself to create a political base purportedly to serve its noble goals and interests. At the start, it was an endeavor that was deigned to fail, and fail it did.

Another misstep not given proper due was the recording of a paper loss of over four million pesos, all because some officers needed to declare income on the investment. And the solution rendered was to redeem the instrument while at the same time re-investing the same amount in the same instrument. Because it was not done on a timely manner, a paper loss ensued. But what was not even mentioned was whether the redemption process involved the payment of fees and commissions which is typical. Never mind the paper loss because it could be recovered by registering a paper gain when the performance of the investment improves.

What is sorely construed in all this is the apparent nonchalance by the parties concerned in owning up and taking responsibility for errant acts done in the discharge of positions of trust and of a fiduciary nature. Is it just invincible cluelessness or deliberate attempts at sweeping things under the rug?

An assembly that was scheduled to end at 5pm may have gone way past the time, and I could not tell since I could not muster enough free time to stay past 5:30pm. And I personally attribute this to a lack of good time management, a task primarily lodged on the moderator of the event. The moderator has to be proactive in making sure time is not wasted on endless discussions with no or scant bearing on the issues at hand, or on rambling speeches by those so inclined. Attention to political correctness or too much sensitivity on people’s feelings has to be curbed for far greater purposes. Like that precious manhours should never be wasted on loopy pursuits.

Was the FICCO Board Had?

Picked up yesterday the latest FICCO Newsletter dated February 2011 and was immediately riveted to an item in the back page that detailed our credit union’s ill-fated relationship with the Ating Koop movement. It was written by former BOD member Gani Daba.

Any layman reading it unaware of any of the inside scoops other than what had been publicly divulged could easily come to the reflexive conclusion that our credit union has become one big and deep-pocketed political action group that was HAD to the tune of over 11 million pesos. Or in a more benign manner, was treated like a wide-eyed suitor who was sent on a fool’s errand.

Reading and re-reading the explosive itemization one is easily led to believe that this whole affair was one deliberately conscious series of actions by all parties involved which spanned two years and which resulted in a series of very substantial disbursements of credit union funds. One has to confess that one is not privy to or conversant with the nature of all the disbursements, whether they were all in fact outright expense disbursements or whether some funds are recoverable.

But what is true is that any cautious person can not help but be amazed at the amounts involved purportedly to “buy” support for our credit union’s goals and interests from a decidedly political and very politicized group.

But as outlined in the news item all these happened.

Thus, at the very least, all members of the board who participated in the process need to have a lot of explaining to do – to reveal what their roles were in the planning and decision-making, and to own up and take responsibility for these huge losses.

And laying in detail what these “continuing threats of lawsuits” are.

The total amount involved is nothing to gloss over, even granting that FICCO has become a multi-billion enterprise. Because it is still made up individually of more than 140,000 members holding on to precious little resources and trying to make ends meet.

F I C C O

Having read through the latest FICCO Newsletter, it can only be inspiring going through the lead article with its articulation of its clear and unmistakable twin messages. That this union can continue to grow only through its membership; and that these continuing hard times require extraordinary measures and efforts from both the organization’s hierarchy and the general membership.

Though implied but not expressly mentioned, one could also take pride in where real strength and stability lie in the organization – in the collective membership where individually, one member on average accounts only for 23,347 pesos in deposit. Meaning therefore that ownership and stakeholding are well distributed among the many members of the union, rather than ensconced in a small elite group accounting for a great majority of the ownership.

Having been a longstanding member through all these many years, one is also heartened by the two graph insets, tracing the growth of membership and total assets. When I left the city in 1980, indeed total membership counted in the single thousand, and assets were mostly in loans and cash in bank. But look at the very big and diverse picture now!

Truly this credit union is where many dispossessed people, people unable to be properly serviced by mainstream financial institutions, can go to seek relief for their many and multifaceted credit needs, rather than to the informal underground institutions which cater and prey on a people weakened by stubborn ignorance and very emaciated economic conditions.

It is an organization that will also aside from providing credit, teach one how to secure and manage debt, and to build a good credit record and history.

But beyond that, it is also the organization where one can truly learn to manage one’s family and business finances – in the areas of saving for the future, saving for business expansion, etc.

In short, it teaches the entire panoply of good and sound personal finance, which is the only basis for hoping and building for a better future, especially in a land filled with asset- and cash-strapped families.

It is therefore quite a damper listening to some current and prospective members recount their initial dealings with FICCO employees where emphasis is placed too much on first building a good credit history to aim for that Class A label. Thus, the recommendation is for members to start borrowing early even before being able to build a good deposit history, so they can become proud Class A members quickly.

Imagine for a moment what kind of a credit union it would be if the driving motive for becoming a member is so one can borrow, typically an amount way beyond what one has put in deposit?

The union would quickly run out of funds to lend, since loanable funds come essentially from members’ deposits.

For a union to continue to prosper there has to be a very delicate balance between those who borrow because they need to, and those who will deposit so they can build for their future and/or in anticipation of some future needs that will be financed or collateralized by their accumulated deposits.

There has to be enough numbers of the second kind, so that the union can continue to have sufficient funds to lend to those truly in need of credit.

In balance therefore, it should be easy to see why both kinds of members are exemplary members, and not that one is rated better than the other. Consider their symbiotic relationship, one cannot live without the other.

In fine, this is the simple and pure logic why financial institutions exist and survive. They pool the community’s savings which in turn will be lent out to those with legitimate needs but lack enough savings to profitably finance them.

All can be member depositors all the time, but not all can be member lenders all the time.

Think about that.

FICCO Still On The Go

Fifty-three years later and it is still logging record-breaking figures in its outreach and operations.

As a long-time member, one cannot help but proudly extol the sacred virtues and sterling accomplishments of this open-type credit cooperative that was started quite inauspiciously by a Jesuit priest way back in 1954 as one way out for its cash-strapped employees and faculty. But as gleaned from a cursory interview with a couple of its motivated officers, it ended the last year with out of the roof figures in total membership (now totaling 108,000), total loans granted, and even in assets registering over 2 billion pesos as of last reckoning.

I am speaking of the First Community Cooperative based here in Cagayan de Oro, Misamis Oriental, Philippines, which first saw light inside the campus of the then fledging Ateneo de Cagayan. Pioneered by the late Fr. William Masterson,SJ, who earlier had been the primary architect in purchasing the Loyola Heights campus and bringing the prestigious Ateneo de Manila within its huge but then distant and rural environs. Fr. Masterson also blessed Cagayan de Oro with his forward-looking establishment of the Ateneo de Cagayan College of Agriculture, in the predominantly agricultural island of Mindanao, long envisioned and projected as the land of promise. The Manresa area in Lumbia which has now been partially converted into premier subdivisions, school site, and commercial center anchored by SM, was to be the fertile ground on which to plant to seeds of agricultural development. He also gave us global Searsolin.

As gleaned from the cover of its latest general assembly report, we get a pretty good idea of the reach and penetration of this now gigantic agent of empowerment and economic change in the otherwise blighted areas of Mindanao. From the bustling urbanized center that Cagayan de Oro is now, to the fabled farmlands of General Santos. To the rarely visited but quite always in the news communities in Ipil, in Zamboanga. To the even less known San Francisco area, tucked in close to the shores of the Pacific in wind-tossed Surigao.

Here’s a quote from Chairman Proculo T. Sarmen:

Cooperatives have proven to be highly effective in improving the quality of life of people all over the world. FICCO is an outstanding example.

FICCO has never been an overnight sensation. Neither was it built nor created by just one individual. It is a collective accumulation of cycles of transition, discovery, hard work and more importantly, collective effort. Great leaders, committed volunteers, diligent staff and supportive members comprise the FICCO Team in striving to reach out and attain its vision and mission.

The journey to success is long and arduous. But the forerunners of this cooperative kept their minds toward achieving the dream of SERVICE, EMPOWERMENT, and UPLIFTMENT.

No truer words spoken.

A Typical Day At FICCO?

Ever wondered what awaits your average bank client in Cagayan de Oro, on a typical banking day, but most especially after the hiatus of a long weekend? Which the previous Holy Week weekend was.

Lines and crowds galore, whether it be in the elegant premises of the big commercial banks with strategic branches scattered around the city, or in the tiny modest lobbies of the biggest multi-purpose credit union in the entire country, FICCO.

Granted that FICCO also has 19 branches and 5 satellite offices scattered throughout the province of Misamis Oriental and in some contiguous neighbors, the scene at its main office yesterday noon could be characterized as representative of the other branches smartly positioned thereabouts. Clients huddled and milled about, awaiting their numbered turns to do their specific transactions and thus be freed and able to get on with other mundane businesses. Serious dads and moms, some with petulant or antsy kids in tow, clutching either their share capital passbook, or deposit passbook, or the bright yellow passbook for loans which in my estimation outnumbered the rest.

The entire multi-storey concrete building of the main office is adequately air-conditioned, but when you crowd in an unusually large number of people, the temperature starts to rise, not only with regard to that in the room. But also in the mind of each individual member when his or her wait starts to heatedly exceed an almost interminable hour or so. Though by and large the mood was that of quiet patience and resignation, it was not difficult to feel the growing impatience, as one saw a kid slouched in one of the comfy couches, slumped and dead to the world in her deep sleep, and the mom dotingly doing her level best under the circumstances to make her feel comfortable.

I had purposely chosen to experience what it was like being part of the crowd under those trying and stressful conditions. We came in almost 30 minutes past noon and did not see daylight again till almost 2 p.m. And I can surmise that the rest also suffered the same fate, in a manner of speaking. Though I definitely have noticed in Cagayan de Oro that that would be equal opportunity suffering because in every bank office one goes, milling crowds are the daily fare, and the “take a number” process is the inevitable bullet to bite.

That long arduous wait gave us sufficient time to reflect on several things, aside from and over and above what one could read on the bulletin boards and pasted-on communications on the walls. BTW, I was mildly taken aback reading a letter from Xavier U president, Fr. Villarin, exonerating one Mr. Isagani Daba from any claims of fraud perpetrated on a certain university fund. Then I realized that Gani, who I know personally from way back, is or was an officer of the university and is also currently a director of FICCO.

Anyway, back to the serious stuff. Now that I have gratingly made my point about the daily crowds in bank offices and have mentally translated that to countless man-hours lost for those who sit and wait for long periods, unable to do any productive work. Unfortunately, I did not see any in the crowds I have seen reading textbooks, doing home or house work, or even clipping nails. Yes, many fiddled, toyed, and played with their cell phones, which is quite ubiquitous even in these unlikely gatherings. Thus, the dire prognostication. Though a sobering thought would have been that at this point in time, the over 10,000 members, or even half of them, of this main office did not collectively decide to converge as one.

Cannot any thing be done to greatly curb or even eliminate these tiresome but more importantly, economically disastrous, losses in man-hours which a beleaguered country such as the Philippines can ill afford?

Especially from motivated groups such as these whom we may impute regard highly value-laden and productive activities?

They obviously value banking services, don’t they?

Aside from giving ear to traditional time and motion studies that have earned great kudos from business past, credit union management may well serve to look at how to marshal the services of other staff members when crowds start to swell out of hand. In this particular instance, one could easily see that other staff members in the building, easily recognizable by their neat uniforms, were leisurely sauntering about among the waiting horde, obviously attending to their own duties, though unrelated to tellering and cash operations and thus, with not much or none at all impact on the gathering crowd that was not subsiding in number.

And I could have brought this urgent matter up to the sitting general manager, who is also a personal friend. Unfortunately, he was out on his lunch break and would not be back until 2 p.m.

And as a final general observation, one can readily recognize this great economic waste in many other areas of city life, such as in unnecessary congestion in traffic, where the losses extend beyond to just man-hours but leap into losses in precious scarce resources – unnecessary wear and tear of vehicles and unproductive use of expensive gas and oil.


Hopefully, some things positive ensue from this whiny piece.

CREATING A REAL DIFFERENCE

That noble message in bold prominent letters was etched on the annual General Assembly reports as the dominant theme for 2007 of the industry’s number one and biggest open-community type multi-purpose cooperative. A quite bold and rightfully-deserved theme for a once insignificant credit union that now celebrates its 52nd year of existence.

How surprisingly refreshing to chance upon a little bright bloom from the current grisly mire of negativism pervading the social and political landscape of a beleaguered country teeming with punditry that caters in wholesale unproductive rhetoric about what is wrong with the country in particular, and with the rest of the world in general. Abundant postulations, prognostications, detailed analytical dismantling of most anything and everything seen, but with hardly any constructive prognoses and actuations that will begin to address the gargantuan concerns besetting the citizenry, on a case by each case, one person at a time basis.

Yet from very inauspicious beginnings in July 8, 1954, birthed as the ACCU (Ateneo Cooperative Credit Union) in the then idyllic city of Cagayan de Oro, located in Northern Mindanao, and commencing with share capital of only 26.30 pesos, this community uplift undertaking has blossomed into something that will stagger even the most vocal and virulent among those who peddle negativism daily in the local blogosphere.

This multipurpose cooperative, now famously known as FICCO (First Community Cooperative, and now designed and registered to serve the entire country) has metamorphosed in to an almost 2 billion peso organization, with about 90,000 members at the end of 2006; and forecasted to register in 2007 2.5 billion in assets and 110,333 members, with increases at 32% and 24% respectively.

And to illustrate the redoubtable clout and deep community penetration of this undertaking, it carried in its books total loans of 1.5 billion pesos at the end of 2006, and projected at about 2 billion pesos for 2007. It is good to note that for 2006 loan releases amounted to 2.1 billion pesos.

But is it profitable? Can regular folks – teachers, drivers, market vendors, small entrepreneurs, etc, be trusted not only to faithfully follow a savings regimen, but also be counted upon to make good on loan accommodations?

Suffice it to say that the cooperative has always been stellarly profitable, and the last year was no exception.

For 2006, it registered net surplus for distribution to the tune of 118 million pesos, 70% of which were distributed to members as interests for deposit accounts, dividends on share capital, and patronage refunds to loan clients. Typically, 95% of the 70% are devoted to interests and dividends, while 5% for patronage refunds.

It was therefore with eager anticipation that I had my passbooks updated after an absence and dormancy of accounts for over a year. Needless to state, the increments were rather substantial, definitely better than what one would get for funds invested in other private financial institutions.

As an active member of FICCO since the 70’s, one finds some difficulty being quiet and reticent about the effectiveness and feasibility of this collective effort in its avowed purposes aimed at poverty alleviation, with emphasis on both development of a propensity to save and the integrity and mature commitment in discharging responsibilities with regard to credit accommodations.

As an equivalent shout at the rooftops, one cannot imagine the cluelessness and seeming ignorance of many pundits, government technocrats, and even in your typical highly-intelligent but dismally reality-aware pundits who ceaselessly harangue the blogosphere with endless rhetoric about what is wrong with the country and what should be done according to their idealized analyses.

Duh! Slow down and smell the coffee. You, too, may be able to participate in something constructive however puny or powerless one may feel about the overwhelmingly pervasive poverty conditions of the country. It is never that utterly hopeless. Most times meaningful solutions are within arm’s length of most everybody.

It does require great humility, and some real sweat equity, to climb down from one’s high perch of empty rhetoric, down to the levels of real actions, sometimes dirty, or insignificant or inconsequential, and do not derive much public notice to stoke one’s egotistical designs.

My exhortation? Contribute toward creating a real difference. In your own little ways.

UPDATE

The weekend dated March 11th witnessed the 11th and final general assembly comprising the members of the cooperative banking with the main office, held in a cavernous gym in the city’s polytechnic school. It was a rather well-attended affair which proudly reflected the over 10,000 main office clients.

For the sake of convenience and to accommodate the over 90,000 members scattered throughout many areas of Mindanao, it has been deemed proper after all these many years to hold different general assembly meetings in different locations. A truly admirable concept to bring cooperativism wherever it is needed.

Democracy being a rather unpredictable and at times messy affair, the assembly which was scheduled from 8 am to 12 noon went way passed schedule; and though the gym felt like it was filled to the rafters, scores of people milled outside. The much-awaited climax for the affair was the distribution of dividends which was purposely left as the last item for the agenda. And getting almost 11% p.a. for one’s investments was well worth the wait.