Post 200 Roadshow: On The Bridge At Navy Federal
Welcome to the Post 200 Roadshow. We're dropping in on the region's biggest companies, nonprofits, employers and law and lobby firms to have a look around and chat up their executives. This week, we stopped by the Vienna corporate headquarters of Navy Federal, the world's largest credit union. You can check out the Post 200 here.
By Dan Beyers
Navy Federal's sprawling campus is hidden among the leafy residential suburbs of Vienna Va., seemingly far removed from the hustle, bustle of nearby Tysons Corner. Chief Executive Cutler Dawson, a former Navy officer, seems proud of his little corporate oasis, inviting us to have a look at the campus "from the bridge," where we get a panoramic view from his executive suite.
The campus is indeed a big place, fitting for the world's largest credit union, with 3 million members, $35 billion in assets, and 7,500 employees, more than half of whom work in greater Washington. The digs sport all the amenities of the modern corporate cocoon -- well-stocked cafeteria, fitness club, even massage tables. The place is spit-shine clean, quiet and everyone addresses you as "Sir." It's a real shipshape place. But what stands out are all the women. They make up 73 percent of the company's employees.
How did that happen?
Dawson explains that Navy Federal got as big as it did by making sure it had a branch near or on nearly every Navy base and port of call around the world. It has 151 of them, in places as remote as Diego Garcia, a tropical atoll of some strategic import in the Indian Ocean. Often, the people who go to work for Navy Federal are the spouses and family members of the military personnel stationed at those bases, giving the company a transient but relatively loyal and distinctly female workforce (but curiously, only one woman sits on a board of directors of predominately white males elected by members).
Navy Federal has recently moved to expand its customer base to members of the other services, and has begun opening branches near Air Force bases and the like. It remains to be seen how successful the strategy will be. The company is just coming off a year when it grew rapidly, opening 34 branches, and Dawson said the company does not expect to maintain quite the same pace given the economic outlook.
Dawson said Navy Federal has fared well through the credit crunch so far. The company did not make subprime or other risky mortgage loans. In fact, "we're on track to make more loans this year than we did last year," Dawson said.
That doesn't mean Navy Federal isn't watching the credit situation carefully. Dawson said he is particularly concerned about the fate of Fannie Mae. Navy Federal once sold many of its loans to the DC mortgage finance giant, using the proceeds to loan out even more money to prospective homeowners (Navy Federal continued to service the loans it sold, to maintain contact with its customers). But as Fannie has struggled and raised its fees, Navy Federal has decided to hold onto more of its loans, slowing eating up its lending capacity. Dawson said the company should be able to continue lending money at its current rates through 2009 and maybe into 2010. However, "you can't do that forever...Eventually you are going to fill up your bucket."
August 29, 2008; 10:00 AM ET
Post 200 Roadshow
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