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Business Lending Losses Bring Down Telesis

Over the past few years, Telesis made loan workout attempts to avoid placing properties in foreclosures and sued others that had defaulted.

Telesis made its entry into business lending as Telesis Partnerships LLC. In 1995, it became Business Partners LLC, a CUSO that was originally owned by more than a dozen credit unions nationwide.

While the credit union forged ahead on building its business lending program, its participation loan network continued to grow. As recently as January 2011, Business Partners had formed BP Connect, a loan participation network to connect buyers and sellers.

As of December 2011, the total balance of participation loans sold or serviced by Telesis neared the $427 million mark. Telesis retained $120.5 million in participation loans at the end of the year, down from $147.4 million in December 2010, according to Telesis December 2011 NCUA Call Report.

Some have speculated that the $318 million Telesis overextended its business lending efforts and that reach, which included out-of-state deals, led to the credit union being placed into conservatorship.

At yearend 2010, the credit union had sold $26 million in participation loans, compared to $29 million as of December 2011. Telesis, however, had not sold or purchased any loans in full from financial institutions or other sources since at least December 2010, according to the NCUA data.

In early fall 2011, Telesis addressed reports about its safety and soundness particularly after Bauer Financial, a financial institution ratings and research firm, gave the credit union zero out of five stars based on its status as of June 2011.

Without naming Bauer or any other ratings firm, Telesis addressed the concern on its website.

While there are a few websites that assign ratings to banks and credit unions, its important to keep in mind that these websites often only look at a narrow range of numbers that may not accurately reflect the overall situation at Telesis or our performance in relation to other credit unions of our size and region, Telesis wrote at the time. As one site itself states, it uses lsquo;conservative measures when assigning these ratings and consequently the ratios will often be lower than those supplied by other analysts or the institutions themselves.

Grace Mayo, president/CEO of Telesis at the time of the credit unions conservatorship, did not return phone calls from Credit Union Times.

The NCUA said Business Partners will continue originating and servicing loans. According to Telesis most recent NCUA Call Report, the CUSO is not wholly owned by the $318 million credit union. As of December 2011, Telesis had an investment of $4.8 million and a $10,000 aggregate cash outlay in Business Partners.

Business Partners will continue to service the loans, business as usual, said NCUA Public Affairs Specialist John Zimmerman told Credit Union Times. BP is a separate entity and will continue to provide loan servicing and origination.

Zimmerman said Business Partners is servicing participation interests for approximately 180 primarily credit unions, 32 of which are lead lenders.

Jean Faenza, CEO of Business Partners, did not return phone calls.

The NCUA said Autoland will continue to operate.

There is no change or consideration of a change in Autolands position or status with the credit union with NCUA as the conservator, Zimmerman said.

Formed in 1971, Autoland became a credit union-owned entity in 2007 through Telesis, and two other California cooperatives, Kinecta FCU, which has experienced net worth challenges, and California Agribusiness CU, whose CEO was abruptly replaced a couple of years ago, through CU Vehicles LLC, a holding company owned by the credit unions.

As of December 2011, Telesis had $3.8 million invested in CU Vehicles and an aggregate cash outlay of $12.5 million in the CUSO. The credit union loaned nearly $2.3 million to the CUSO.

Autoland referred all questions to Zimmerman.

CUSOs are an asset of the credit union, just like facilities or loans, Zimmerman said. The conservator will continue to represent the interests of Telesis with the CUSOs in which it has invested.

At a time when credit unions were treading lightly, Telesis was considered by some to be early leaders in the commercial lending space.

Lending time for small businesses

Boost your loan chances

Bankers offer these tips for improving your chances of getting a small-business loan:

Get to know your banker. Banks are more willing to lend if they have a relationship with you, understand your business and how you plan on achieving your goals. #x201C;We#x2019;ve got to understand where you#x2019;re going and how you get there,#x201D; said Bob Marshall, business banking senior vice president at Wells Fargo.

Research the bank you will be approaching. Does it participate in SBA loans? What does its lending portfolio look like?

Plan for the unexpected. Understand how your business would be positioned for another downturn in the economy.

Take the long view. Have a one-year and a three-year business plan ready.

Demonstrate consistent cash flow. Remember, a bank is not an equity investor with an appetite for risk. If your company is just starting out, consider alternatives like venture capital or friends and family. Andrew Dunn

Auto Lending Market Share Inches Up To Pre-Recession Highs

This year may be a turning point for credit union auto loan programs with monthly market shares poised to range from 18% to 24%, which were highs experienced prior to the recession.

Thats according to a new white paper, Successful Indirect Auto Lending Programs Build on Credit Union Strengths in Relationship and Portfolio Management, from CU Direct Corp.

The lending services CUSO found that once automotive lending started to recover in 2010 and 2011, with finance companies, captives, and banks re-entering the automotive lending market, credit union auto loan market share began to return to more normal, pre-2008 levels of 17% to 18%.

Nationally, auto loans accounted for 29% of credit union loans outstanding, representing $166 billion dollars in the third quarter of 2011, CU Direct said, citing data from Callahan amp; Associates Inc.

Since the 2009 credit unions indirect lending peak of $76.4 billion, indirect loan volumes have also returned to pre-2008 levels, the data showed. As of the third quarter of 2011, indirect auto loans accounted for 43% of credit union auto loans outstanding versus 37% for the same quarter of 2007.

Prior to the credit crunch of 2008 and 2009, credit union indirect delinquencies and chargeoffs hovered near or below 1%, according to CU Direct. As unemployment climbed, the national average for credit union indirect delinquencies and chargeoffs rose from 1.34% and 1.45% in 2008 to 1.36% and 1.74% for 2009, respectively.

Research from CU Direct acknowledged that some credit unions have struggled to make their indirect programs take off while others have been wary of starting them for fear that loans conducted via an external channel would be harder to control.

To address those obstacles, the white paper reminded credit unions that they have the ability and authority to enforce dealer agreements, which establish credit union lending guidelines and proper procedures to determine member eligibility.

Credit unions can also access reports that provide loan metrics at the dealer level so that they can manage and review indirect lending portfolios to make early intervention and corrections possible to ensure loan quality, according to CU Direct.

In 2010, credit unions started to see their indirect delinquencies and chargeoff rates fall, according to the data. Since then, both have been below 1% for the past three consecutive quarters.

To find out the components of a successful indirect lending program, CU Direct identified several credit unions that had lower charge-off and delinquency rates when compared to the national average for credit unions obtained from Callahan amp; Associates Peer to Peer software.

The credit unions interviewed said it was imperative to measure, track and monitor metrics that report the overall health of the program, in addition to more detailed reports at a branch, dealer, loan officer, and underwriter level.

Tools to prepare for the NCUAs examinations are also essentials, the credit unions said. CU Direct cited Victoria Bennett, stating, [The NCUA] is very much in favor of indirect lending…were just concerned that its a well-run program.

Through open communication with dealers, the credit unions interviewed said it keeps the credit union top-of-mind, helps to understand dealer needs, educates about market changes, and uncovers information related to competitive actions.

CU Direct said in recent years, a few dealers had to be eliminated from the auto lending program due to repeated violations of the dealer master agreement or the credit unions program guidelines. One credit union representative said, Its all about that constant reinforcement, building that trust, assisting when they need help, cleaning up problems on delays for funding. Just working hand-in-hand with them is huge.

A successful indirect lending program also includes communicating loan and member eligibility requirements to dealers as is consistency in underwriting, according to the paper. A consistent review of pricing guidelines is also critical.

Im a fan of getting all the players in the room on a regular basis, monthly, wrote one credit union. We talk about pricing, performance, performance by dealer, and credit tier. We may change our credit tiers once a year, just based on how they are performing.ensp;

Lending a hand

Not everyone is benefiting from Minots booming economy, and the Hooterville Flion Lions are lending a helping hand to people that might otherwise be a little hungry during the upcoming Easter holiday.

Rita Webb and her husband, Ray, members of the Flion Lions, were taking a turn at the booth inside the Dakota Square MarketPlace Foods near the exit doors Saturday afternoon as people dropped off nonperishable food items and monetary donations. Rita Webb, who is a charter member of the Flion Lions, said the goal of the food drive, called Operation Helping Hand, is simple.

Its collecting food for the food pantries, and were hoping to get some just to spread around for Easter, Webb said. And then well be back for Thanksgiving and redo it two or three times a year.

Operation Helping Hand, which has been held for a number of years, took place from 8 am to 8 pm Once the food pantries receive their share of the food, they in turn distribute it to people in need.

Webb said the monetary donations are used to supplement the nonperishable food items by buying whatever else the food pantries need.

Although the weather was sunny and perfect while the Webbs were indoors collecting food, Webb said in past years they had to stand outdoors for the event, which could be brutal during the winter months. She said being able to collect the food indoors, even on as nice a day as Saturday turned out to be, was wonderful.

There is no particular goal as to how much food the Flion Lions are trying to collect, but obviously the more the better.

Just as much as we can, whatever people will donate, Webb said.

While Webb said the food collections were down a little from previous years, she noted there were still quite a few hours left before the 8 pm end to the drive, so she was hoping a late surge would boost their total for the day.

Ray Webb said location might have something to do with donations being down this year. He noted they are usually by the wall near the entrance doors, but an NCAA Final Four basketball tournament display is taking up that space this year, which moved the Flion Lions to the wall by the exit doors, where they are less visible to people entering the store.

While people of all ages donated throughout the day, the Webbs said that, similar to past years, its the elderly who seem to be leading the way in generosity.

People are very generous, particularly the senior citizens are more so than anybody else, Ray Webb said. Theyre the ones who can least afford it, probably, in most cases.

And we get a lot of money donations, too, from people, Rita Webb added. Thats a nice thing, too. It works out really good.

To help get things going, Webb said both the Flion Lions and MarketPlace Foods buy some food to pack the boxes with and get people into that giving mood.

The Webbs have been helping with Operation Helping Hand for a number of years, and Rita Webb said its a great feeling to help those in need, which is why they keep doing it year after year.

Its a very, very good feeling, Webb said. We do our fair share of the work in donating, also, so it is a good feeling just to know that somebodys going to eat just because youre out here helping. That makes it worth it.

Euribor bank-to-bank lending rates hit 20-mnth lows

FRANKFURT, March 29 (Reuters) – Key euro zone bank-to-bank
lending rates hit a fresh 20-month low on Thursday, weighed down
by excess cash the European Central Bank has pumped into the
financial system to revive the interbank market and encourage
bank lending.
Euribor rates have dropped by more than 40 percent as a
result of the 1 trillion euros the ECB has poured into financial
markets since December in the form of 3-year loans.
Three-month Euribor rates, traditionally the
main gauge of unsecured interbank euro lending and a mix of
interest rate expectations and banks appetite for lending, fell
to 0.783 percent on Thursday, the lowest level since the start
of July 2010.
Rates in longer-term maturities also dropped. Six-month
rates fell to 1.084 percent from 1.090 percent and
12-month rates dropped to 1.420 percent from 1.426
percent.
The one-week rate, which continues to bump
around all-time lows, dipped to 0.317 percent. Overnight rates
inched down to 0.352 percent from 0.353 percent.
Despite the sharp fall in interbank rates over the last few
months, the benchmark three-month rate remains above the
euro-era low of 0.634 percent it hit in early 2010.
Futures markets see further falls, however, on expectations
the ECB will keep limit-free liquidity available for the
foreseeable future and that official interest rates stay at
their current record low of 1 percent for an extended spell.
The ECBs recent cash injections have helped the money
market but the situation remains difficult. Banks are parking
much of their excess cash back at the ECBs overnight facility,
with the latest data showing the amount at 774 billion euros.

Euribor rates are fixed daily by the Banking Federation of
the European Union (FBE) shortly after 0900 GMT.
* For a table of the latest Euribor fixings for terms of one
week to one year, double click on
* For a table of the previous days fixings of EONIA swap
rates, which show market expectations for future overnight
lending rates, double click on
* For graphs of historic Euribor and EONIA swap rates, right
click on the links in angle brackets below, and select Related
Graph
1 week
2 week
3 week
1 month
2 month
3 month
4 month
5 month
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7 month
8 month
9 month
10 month
11 month
1 year

(Reporting by Frankfurt newsroom)

Peter Boutell, Lending a Hand: Advice for prospective homebuyers

seller will expect a valid and truthful pre-approval letter. It is not too early nor unusual for prospective homebuyers to be meeting with a lender six or more months before they plan to buy.

Interview one or more Realtors to find one that you feel you will be comfortable with and one who has, hopefully, been referred to you by a friend or work associate. Once you select an agent, put all of your trust and confidence in that person. If it turns out that you feel your relationship with your agent is not working out, let him or her know and pick another agent. It is best to work with one agent at a time. That way, you will get the best service.

Work with your Realtor to keep your purchase contract as simple as possible. Since, typically, contracts are written to make the purchase contingent on physical inspections of the property, it is not necessary for the buyer to make the sale contingent upon specific inspections like pest, roof, well, soil, etc. If the contract states that these inspection reports are part of the purchase contract, the lender will also expect to see those reports, and if any work is recommended, the lender will require the work to be completed prior to the close of escrow.

It is typical for homebuyers to be nervous about the real estate market and the potential future direction of home prices. It is not hard to find housing statistics for our area [try the Santa Cruz County Association of Realtors site: www.SCAOR.org]. These statistics are telling us that todays median home price is comparable to where prices were in 2002, close to $500,000. Most housing experts agree that we are close to the bottom for home prices.

Keep in mind that once home prices start to increase in earnest, sellers will once again be in the drivers seat and will be expecting higher prices. With low mortgage rates and willing sellers, it should be an excellent time to be jumping into the housing market.

Local mortgage consultant Peter Boutell has been writing a weekly column for the Sentinel since 1995. Send questions to Lending a Hand, 1535 Seabright Ave., Santa Cruz, CA 95062, fax them to 425-1044 or email them to peter@santacruzhomefinance.com. Archived columns are available at www.peterboutell.com.

The lending industry’s conundrum

The Justice Departments complaint filed in conjunction with the record $335 million settlement of lending discrimination claims against Countrywide Financial Corp. sends one clear message to lenders: Once aware that their practices lead to racial disparities in things like assignment to subprime loans, lenders must seek out less discriminatory alternatives. That message puts lenders in a difficult position, and not for the first time.

In the 1990s, when standard lending criteria were found to cause disparities in rejection rates of white and minority mortgage applicants, lenders were urged to relax those criteria. Doing so was akin to the lowering of cutoffs on employment tests that disproportionately disadvantaged certain groups. Lowering cutoffs had long been regarded as reducing the disparate impact of such tests because it reduces relative differences in pass rates. For example, if pass rates are 80 percent for an advantaged group (AG) and 63 percent for a disadvantaged group (DG), DGs pass rate is about 21 percent lower than AGs pass rate. But if the cutoff is lowered to the point where 95 percent of AG passes, assuming normal test score distributions, DGs pass rate would be about 87 percent. Thus, with the lower cutoff, DGs pass rate would be only 8.4 percent lower than AGs pass rate.

But, whereas lowering cutoffs tends to reduce disparities in pass rates, it tends to increase disparities in failure rates. In the situation just posited, DGs failure rate (37 percent) was initially 1.9 times as high as AGs failure rate (20 percent). After the cutoff was lowered, DGs failure rate (13 percent) was 2.6 times AGs failure rate (5 percent).

This pattern is not peculiar to test-score data or the numbers I chose to illustrate it. Inherent in the shapes of normal distributions of factors associated with experiencing some outcome is a pattern whereby the rarer an outcome, the greater tends to be the relative difference in experiencing it and the smaller tends to be relative difference in avoiding it. The pattern can be illustrated with any data showing points on a continuum of factors associated with experiencing an outcome. Such data show, for example, that reducing poverty tends to increase relative differences in poverty rates while reducing relative differences in rates of avoiding poverty or that reducing blood pressure tends to increase relative differences in hypertension while reducing relative differences in rates of avoiding hypertension. About 160 references explaining these patterns as they bear on some misinterpretation of data in the law or the social and medical sciences including my National Law Journal article of March 5, 1990 (An Issue of Numbers) and my three Legal Times articles are available at www.jpscanlan.com/measuringhealthdisp.html.

Relaxing lending criteria tends to reduce disparities in mortgage approval rates just as lowering cutoffs tends to reduce pass-rate disparities. But it also tends to increase relative differences in the mortgage rejection rates that had prompted the initial concern. And those monitoring lending disparities continued to focus on rejection-rate disparities. Thus, lenders that were most responsive to the encouragement to relax criteria hence, more so than other lenders, tending to reduce relative differences in approval rates while increasing relative differences in rejection rates were regarded as the most discriminatory lenders.

The failure to understand these statistical patterns has been reflected in other mistaken interpretations of lending disparities. For example, both as to mortgage rejection disparities and subprime disparities, it has been asserted that arguments that income differences account for the disparities are refuted by the fact that disparities are greater among higher-income groups than lower-income groups. But relative differences in adverse outcomes tend to be larger among higher-income groups simply because such outcomes are rarer among such groups. For the same reason, relative differences in favorable outcomes tend to be smaller among higher-income groups.

Increasing attention is now being given to foreclosure disparities, with calls for policies that generally reduce foreclosure rates and for enforcement of anti-discrimination laws. But reductions in foreclosures, while tending to reduce differences in rates at which minorities and whites keep their homes, will tend to increase the differences in foreclosure rates that are prompting the call for action. And lenders that individually seek to reduce their foreclosure rates are likely also to see their foreclosure disparities rise.

So whether the disparity for which a lender must seek a less discriminatory alternative involves rejection rates, assignment to subprime mortgages, foreclosures or any other adverse outcome, the lender must face the possibility that the course that yields the lowest rate at which minorities (and nonminorities) experience that outcome will be perceived as the most discriminatory course of all.

James P. Scanlan is an attorney in private practice in Washington. He specializes in the use of statistics in employment discrimination litigation.

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Lending Growth Slows in Euro Zone

FRANKFURT — Bank lending to consumers and businesses continued to grow very slowly in the euro zone in February, according to figures issued Wednesday, a sign that the so-called wall of money unleashed by the European Central Bank in recent months has not yet reached borrowers.

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Markus Schreiber/Associated Press

Mario Draghi, the president of the European Central Bank, earlier this week expressed optimism that a program to offer cheap loans to banks would soon reach small businesses.

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• Times Topic:
  European Debt Crisis

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The growth of loans to the private sector slowed to an annual rate of 1.1 percent, from 1.5 percent in January, the bank said in its monthly report on the euro zone money supply. The report, normally fairly routine, was closely watched for what it said about the impact of 1 trillion euros ($1.3 trillion) in low-interest three-year loans that the central bank has disbursed to banks since December.

Most economists agree that the three-year loans have taken pressure off banks and helped avert a serious credit shortage that would have disrupted the euro zone economy.

At the end of last year, for the first time in the history of the euro, the overall supply of money as measured by the central bank declined for three consecutive months.

The loans seem to have reversed that trend.

But the data released Wednesday showed that the central bank’s program had not yet translated into a big increase in lending or borrowing.

“The risk of a credit crunch in parts of the region has not fully disappeared,” Martin van Vliet, an economist at ING Bank, said in a note to clients Wednesday.

Top officials of the central bank have said they did not expect the lending to reach borrowers immediately. Compared with January, lending to the private sector fell by 8 billion euros in February, though the level was still higher than it was a year earlier.

“The E.C.B. may be not too disappointed about the monetary data published today, as it probably expected the sluggish loan momentum to continue for some time,” Michael Schubert, an economist at Commerzbank, said in a note to clients.

The second round of the central bank’s three-year loans was not issued to banks until March 1 and would not have had any impact on the data released Wednesday.

Tepid lending growth may also reflect reluctance by companies and people to borrow, rather than a lack of banks willing to lend, Mr. Schubert said.

The European Central Bank reported sharp declines in lending in Spain, Portugal, Ireland and other countries struggling to contain government spending.

But the growth in lending was also slow in Germany, which has avoided much of the pain of the European sovereign debt crisis.

Mario Draghi, the president of the European Central Bank, expressed optimism this week that the loan money would soon reach small businesses. Hundreds of smaller German community banks, the traditional source of credit for smaller companies, were among those taking advantage of the second round of loans, he said.

“We cannot say that this money will necessarily go to these smaller enterprises,” Mr. Draghi said in Berlin on Monday, “but it is certainly very close to them.”

Refinancings drive first quarter leveraged lending, M&A absent

NEW YORK, March 30 (RLPC) – Volatility subsided in the first quarter of 2012 following the shorter, steeper cycles observed last year. As a result, 1Q12 high yield volumes were robust, but they were driven by refinancings rather than new money transactions, according to Thomson Reuters LPC data.

Bond investors poured more cash into high yield bond mutual funds in the first three months of 2012, at $19 billion, than in each of the last two full years, which totaled around $14 billion each, according to Lipper FMI.

1Q12 high yield bond issuance broke the prior $83.25 billion record set in 4Q10, reaching $88 billion. 1Q12 US leveraged loan lending was up 42 percent from the prior quarter, at $144 billion, while institutional loan issuance doubled to $60.52 billion, according to Thomson Reuters LPC.

The outlook for merger and acquisition financings remains muted. Strategics and private equity buyers may be sitting on cash, but are reluctant to pull the trigger on new MA transactions. A few factors are at play: the buyer/seller mismatch given a rapid rise in valuations, an election year and global macroeconomic uncertainty.

The absence of MA transactions, coupled with strong investor demand for loans, led to issuers pursuing refinancings or amend and extends. Some were running up against their maturities while others refinanced opportunistically bringing aggressive deals to market that tested investors tolerance for low yields. Heading into 2Q12, investor demand continues to outpace supply of new loan product and arrangers are competing fiercely to book deals. Structures may begin to deteriorate given that yields in the institutional market have already tightened significantly.

A post-crisis record, $29 billion of high yield bond proceeds was used to pay down loans in 1Q12, leaving investors with extra cash to reinvest from prepayments. However, the makeup of the loan investor base continues to shift. Weekly loan mutual fund flows were flat to down, totaling a positive $106 million through March, compared to $14 billion last year, according to Lipper FMI.

Conversely, collateralized loan obligation (CLO) issuance gained traction with $5.65 billion priced this year and another roughly $2 billion in market, according to Thomson Reuters LPC. Market sources expect that CLO issuance could reach $20-25 billion this year, compared to $13.24 billion in 2011 and $4 billion in 2010.

However, given the volume of existing CLOs reaching the end of their re-investment periods, net new CLO demand remains negative. CLOs currently hold roughly $250 billion in loans with roughly 25 percent of the underlying loan volume coming due in 2014 and nearly 60 percent coming due between 2016 and 2018, according to LPC Collateral.

Banks also sought high-quality leveraged paper in 1Q12, and at $83.5 billion, leveraged pro rata lending outpaced the $60.53 billion in institutional issuance. Banks have consistently remained active buyers in the past few years. Given recent investor pushback, there may be a yield threshold in the institutional space. Meanwhile, market players expect yields may fall further on pro rata paper on the back of strong demand from banks.

However, rising cost of funds and capital constraints continue to plague select continental European banks. Lenders say spreads on investment grade loans, both drawn and undrawn, will stabilize in the near term as a result.

Investment grade lending was down 54 percent in 1Q12 relative to the prior quarters $116.82 billion, and down 20 percent from 1Q11. Heading into 2012, most issuers had already addressed their 2012-2013 maturities, rushing to get ahead of regulatory changes and shifts in bank appetite by locking in longer tenors and favorable terms.

According to Thomson Reuters LPCs quarterly survey, 20 percent of investment grade lenders are more constrained this year with regard to total availability of capital while only 10 percent are less constrained.

Lenders that are constrained have remained active but selective. In a dynamic regulatory and economic environment, lenders are carefully evaluating relationships and deploying capital strategically. These lenders are exiting or reducing commitments in cases where they cannot justify the relationship, but in others, they are stepping up for a bigger role. Variability in bank behavior will be one the biggest challenges for the investment grade market in 2Q12.

(Reporting By Thomson Reuters Loan Pricing Corp analyst Ioana Barza)

Stocking Fish: Lending Mother Nature A Helping Hand

For Western New York anglers, one of the surest signs of spring is the stocking of fish in local streams and lakes.

The yearly release is conducted by the New York Department Of Environmental Conservation, a program that began in the late 1980s. Each year, the DEC stocks almost a million pounds of young fish to almost 1,200 bodies of water across the state.

The fish begin life in one of the states twelve hatcheries, where theyre raised for up to two years.

Once ready, the young trout are transported by truck to each location, where a small army of volunteers helps release them.

Scott Cornett is a Fisheries Biologist with the NY DEC.

We try to do the stocking as close to opening day as possible, hoping that the water has warmed up. This year its been an unusually warm spring, we have conditions that are more normal in late April to early May stream conditions.

They wont stock if its really at flood stage or real bad conditions. You dont want to put the fish in when the water conditions are real cold, or real high, you can lose a lot of fish.

Stocking fish is a precise science, and there are a school of different factors in determining when and how many fish will be released…and even if a stream will get stocked at all.

For example, the East Koy Creek gets fish every year. But its nearby neighbor the Wiscoy…doesnt require stocking at all.

Cornett explains:

Environmental reasons, the water gets a little bit too warm in some sections for providing really good amounts of reproduction like we have just over the hill in Wiscoy Creek, that stream we dont stock.

So the water gets a little bit too warm sometimes and we dont get quite enough natural reproduction. We do have almost continuous public fishing rights on this stream. Theres a lot of public access, so thats another reason, its pretty popular.

Jerry Brown has helped stock a lot of fish, and hes been volunteering to help the DEC for over fifty years.

We stock from Hermitage down through Gainesville, Lamont, weve got about ten or twelve stops, and we usually put several thousand fish in every year.

The process is supported by dollars taken from fishing licenses, so it is the anglers themselves who fund the program. The process doesnt stop once the fish are released, the DEC continues to monitor the creek throughout the year.

Cornett tells 2 The Outdoors:

The stocking also goes along with an angler survey, find out how many people are fishing and what theyre catching. We also do fish population surveys in May and August to see whats left here of the stocked fish in both of those months, as well as how many wild fish are left in the stream.

Improved fishing opportunities are not only a boon to anglers…local economies benefit as well.

Certainly, where we stock trout, it brings a lot of anglers in, says Cornett. They spend money, they buy things at local stores, they purchase gasoline, and fishing equipment.

Brown agrees: It helps the restaurants and the business places, it all helps the local economy.

From hatchery to stream, stocking fish is hard work, and it certainly doesnt go unappreciated as anglers throughout the state reap the benefits of the DECs efforts. Efforts that go far in adding to New Yorks reputation as one of the richest fisheries in North America.

Cornett:

Weve got a lot of diversity, whether its stocked trout, weve got a lot of wild trout streams that we dont need to stock. We have Steelhead fisheries in Lake Erie, Lake Ontario, and the tributaries; (and) excellent Bass fishing in a lot of lakes.

Its really like that throughout the state, we really have a lot of good fishing. In a lot of ways the fishing is as good as its been in many streams as it has been in a hundred years.