ANCHORAGE, Alaska – Alaska USA FCU is staffing up tonight and through the end of the week to handle as much as $280 million of new member funds passing through as part of the annual dividend from Alaska’s Permanent Fund.
An estimated 37% of this year’s $760 million payout will be flowing through the $4.4-billion credit union, the state’s biggest local depository, either tonight through direct deposit, or in the coming days by mail.
That huge flood of funds means tens of thousands of Alaska residents who still need to cash their checks, as well as annual overload of the credit union’s call center, online and mobile channels and ATMs. “It’s a huge day,” said Dan McCue, senior vice president, corporate administration for Alaska USA.
Alaska’s annual dividend checks go to every one of the state’s eligible 647,549 residents, with some families receiving as many as six or seven checks. The checks come from earnings accrued on the state’s Permanent Fund, a $40 billion reserve account that, since its creation in 1976, has been fed by oil revenues. This year’s dividend will be $1,174, down from $1,281 last year, and a high of $2,069 in 2008.
Recipients must live in Alaska for at least a year before being entitled to the checks.
Dividend Day creates both challenges – such as ensuring all members have immediate access to their money, and as much as a 50% increase in cash needs at the credit union’s 36 Alaska branches and ATMs – and opportunities, noted McCue. Among them are marketing possibilities not only for the credit union but all merchants in Alaska. “Anybody who is selling something is going to find out how to get a piece of the [dividend],” he told Credit Union Journal.
The huge inflow of funds yields earnings on the float. If Alaska USA, which exceeds Wells Fargo for the biggest market share in Alaska, gets 37% of the $760 million payout, that amounts to $280 million that passes through the credit union over a matter of days or months.
State officials say $658 million, or 83%, of the funds will be delivered by direct deposit tonight, with the remainder paid out in 93,000 checks being mailed tomorrow.
