RANCHO CUCAMONGA, Calif. — Co-Op Financial Services is acquiring the LoanLink Center from CUNA Mutual. CUNA Mutual will retain the 2-year-old customer service facility that houses TLC, which takes up roughly half of the space there and will lease that space to CO-OP, according to CO-OP CEO Stan Hollen.
Hollen said CUNA Mutual Group began reviewing its operations back in April and selected CO-OP from among a number of candidates to purchase TLC. "We've been actively engaged now for about two months," Hollen told Credit Union Journal after holding the second of five meetings he is having with TLC employees who now work for CO-OP. "We know each other well, and we're so similar in our support for the credit union industry. We are the two leading providers to the industry that are credit union-owned, and we respected their desire to keep the center here and keep their employees here. They already used the NGN Switch, which is a CO-OP technology, so we're a natural fit."
Hollen said the transition of support services, such as payroll, will be done in February and made a point of noting that CUNA Mutual Group is not getting out of the lending business. "CUNA Mutual is choosing to focus on products that are core to its financial success and core to credit unions' business objectives," said CUNA Mutual Spokesperson Maripat Blankenheim, when asked whether the sale of TLC indicates the company is refocusing on its core insurance products and services. "In products where we are unable or have not demonstrated an ability to differentiate, we will partner with respected vendors to deliver industry-leading solutions. In this circumstance, CO-OP is an ideal candidate."
Blankenheim added that just as CUs regularly review their member offerings, "we're taking a hard look at what products are core to meeting our customers' business objectives, and those that are core to our financial success."
The troubled economy, coupled with the ever-smaller number of credit unions is driving CUNA Mutual to take that "hard look" to ensure its long-term future, she said, pointing out that company is still interested in diversifying into new markets, such as growing its retirement products outside the credit union market "in a manner that in no way diminishes our commitment to credit unions."
Terms of the deal were not disclosed, but CO-OP will assume operations and all employees for TLC, and the companies will partner in the sales and remarketing process.
