Credit unions get bigger despite bank/thrift crisis; Hughes Aircraft employee group is largest in county.

While local banks and savings and loans are shrinking, the 25 largest credit unions in Los Angeles County have grown in asset size by a combined total of 10.1 percent over the last year, according to this week's List.

Assets at the top 25 credit unions in the county grew from $7.682 billion in the third quarter of 1991 to $8.465 billion in the third quarter of 1992. In that time period every credit union on The List except one, Continental Credit Union, the credit union for Continental Airlines employees, increased asset size.

A number of credit unions, including No. 20-ranked Cal Tech Employees Credit Union, No. 13-ranked Gasco Credit Union, No. 6-ranked Rockwell Federal Credit Union and No. 15-ranked Los Angeles Police Credit Union, saw assets grow by more than 15 percent.

Karen Ron, spokeswoman for the Los Angeles Police Credit Union, which saw assets increase by 17.8 percent, said many people are turning away from banks and savings and loans and to credit unions.

"We're starting to introduce new products and services," she said. For example, the police credit union last year began a special program for seniors which includes free checking and no fees on check charges, while big banks are discontinuing seniors programs, Ron said.

No. 1 on The List is Hughes Aircraft Employees Federal Credit Union, which saw assets grow 10 percent from $1.145 billion in the third quarter of 1991 to $1.258 billion a year later.

John Merlo, vice president with the credit union, said there are a number of reasons Hughes and other credit unions have been experiencing growth. Because credit unions are not for profit, "we pay above market rates on savings," Merlo said.

The Hughes credit union is currently offering an interest rate of 3.5 percent on a basic passbook savings account and 2.5 percent on a checking account, Merlo said.

Hughes' credit union has grown by 11,000 members even though the aerospace company has cut back its work force in recent years, Merlo said, noting that if a Hughes employee is laid off, he or she still can be a member of the credit union.

In the past few years Hughes has offered the services of personal financial planners to laid-off credit union members for free, Merlo said.

The No. 4-ranked Los Angeles Teachers Credit Union has offered a number of special products and services to help free up cash for teachers and other members who suffered pay cuts this year, said Alan Fricke, chief executive of the credit union.

L.A. Unified School District teachers, who make up a majority of the membership of the credit union, got hit by a 12 percent pay cut this year on top of a 3 percent pay cut last year, Fricke said.

The pay cuts average out to about $400 a month for teachers who earn $40,000 a year, and caused cash flow problems for the teachers, Fricke said. In September, "the credit union said, we have to go out and do something for our members," Fricke said.

At no charge, the credit union refinanced all first mortgages on which members were paying high interest rates, Fricke said. Now no member is paying more than 8.75 percent interest on a 30-year fixed rate mortgage, he said. Also, the credit union is offering lower interest rates on loans to buy used cars and a low 9.9 percent interest rate for personal, unsecured loans, Fricke said.

He said the credit union is able to offer these services because it is financially strong. Fricke added, "We're not worried about how much we have to pay in dividends to stockholders. We work for our members."