The North Bay Credit Union CEO Chris Call rocked the financial world by allowing the cannabis industry to open accounts.
With marijuana still a federally illegal drug, bankers routinely shy away from taking in cannabis industry cash.
Not Call. He believes in helping legitimize this sector of the business community that is operating legally in California.
“We could grow exponentially if regulators would allow us to. They have put stipulations on how much we can grow and how fast we can grow,” Call said.
The credit union, which came into being in 1948, is the oldest such institution in Sonoma County. In 2020 it also began serving anyone who lives or works in Marin, Solano and Napa counties.
Call expects net income for the credit union this year to be approximately $2 million.
Besides wanting regulators to loosen their grip on the banking world, the 62-year-old Call has other ideas about his industry, which he shares below with the North Bay Business Journal.
What trends that affect your industry keep you up at night?
The burden of government regulation. We are regulated by the Department of Financial Protection and Innovation. They regulate all financial institutions in the state of California. It’s just very difficult dealing with them because we are a fairly progressive institution and regulators don’t like progressiveness, they like traditionalists.
A lot of it centers around the cannabis industry. There is a tremendous need in the state for cannabis banking services. There is not enough supply for the industry side.
The banking industry overall, but DFPI in particular, is a very conservative, traditional body and has a mindset that I think belongs in the 1980s.
If you could change one government regulation, what would it be and why?
Federal legalization of cannabis. The majority of Americans support it, it would level the playing field between state licensed cannabis operators and those operating illegally, it would promote economic activity, increase tax revenues, enhance public safety and free up the justice system from unnecessary prosecution of users and purveyors of cannabis.
What led you to decide to allow North Bay Credit Union to handle transactions from the cannabis industry?
Our concern for public safety was the prime motivator. The growing number of cannabis operators in the North Bay who were forced to store and transport cash unsafely because banks wouldn’t take their money created an incentive for crime and violence.
As a supporter of our community since 1948, we felt obligated to help solve the problem rather than contribute to it. We have since taken in over $1 billion in cash that would have otherwise been left exposed and vulnerable.
What have been the positive as well as negative repercussions from that decision?
In addition to contributing to the safety of our community, we have helped business owners normalize and grow their operations, which promotes economic vitality in our community. We’ve also been recognized nationally as pioneers and leaders in the cannabis banking area.
Negatives are that we are now under our regulator’s microscope and have had to dedicate enormous resources to our compliance efforts.
What is your opinion about the future of the national economy? And how will that affect your business?
The excesses of government expenditures will put the U.S. at the mercy of creditor nations like China. Financial markets will become increasingly more sensitive to geo-political events that are beyond our control.
What concerns do you have for your business and industry looking out five years?
The rise in consumer debt is alarming and too many people are living on a shoestring. Our society has veered heavily toward consumption and less on production, which is an unsustainable position.
You are in the business of giving loans, therefore helping people have debt. What role does North Bay Credit Union have in being a moral compass for who gets a loan?
We are in the business of trying to help people achieve their financial objectives. We as a credit union, as opposed to large traditional banks, take a personal approach to their financial situation. We can provide counseling about a person’s debt situation as opposed to a commercial bank that pushes papers across the desk.
With a credit union there is the hands-on personal aspect to working with our members.
What is your approach to making business decisions that are tough and important?
Consult with key stakeholders and advisers, research issues, pull the trigger. Review, reassess, revise as needed.
What qualities do you admire in other executives that you've tried to emulate?
Visionary, decisiveness, compassion.
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December 16, 2021 at 01:08AM
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North Bay Credit Union CEO is OK with trailblazing in cannabis banking - North Bay Business Journal
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