Partnership - this concept is certainly nothing new for credit unions. In fact, it's really one of the many forms of cooperative behavior that has made credit unions what they are today. Corporate credit unions also have long benefited from sharing information and ideas with each other - despite competition that has become a part of our landscape in recent years.
Even now, Georgia Central partners with many corporates to create efficiencies and expand our product offerings, including CUSOs such as Corporate Synergies, Member Business Solutions and Primary Financial, as well as single product partnerships for ALM and bill payment.
However, I would like to focus some comments on one of our partners that you've heard a lot about lately - U.S. Central Credit Union.
U.S. Central was, just like Georgia Central and many other corporates, born of the aspirations of credit union visionaries- individuals who recognized the value of applying cooperative principles to the aggregation of resources for wholesale financial services. These leaders knew that collaboration would result in better products, service and pricing for all credit unions.
As it happens, they were right-no other source can match corporates' ability to meet credit unions' liquidity, investment and payment needs. I believe that the resulting cost savings and operational efficiencies have been integral to credit unions' success in maximizing value to their own members.
As a U.S. Central board member, I have seen firsthand the face of rising competition in recent years; however, U.S. Central has made a herculean effort to serve those corporates whose wagons are still firmly hitched to the three-tiered business model. Georgia Central is among them.
This multi-level system has served credit unions well over the years, as it has provided access to the market through a series of channels in a way that capitalizes on economies of scale.
It is my firm belief that the cooperative governance model, which ensures that the best interests of corporates and their members receives top priority, has driven much of U.S. Central's success, creating a responsive and dynamic enterprise staffed by talented individuals who navigate complex financial instruments and payment systems on our behalf.
The many products and programs facilitated for credit unions by U.S. Central include all corporate investments, lines of credit and other liquidity options, automated settlement, funds transfer, securities safekeeping, marketable securities brokerage, international services, and more.
Over the past year, unprecedented market events have created universal stress on the business model, which depends on the ability to sell high-quality assets in order to sustain adequate liquidity.
Still, corporates and natural person credit unions continue to benefit from U.S. Central's presence, as we have been insulated from losses associated with taking market risks, all the while benefiting from excellent returns on settlement dollars and investments of all types.
As we weather the market turmoil, it has been inspiring to see corporates come together to support U.S. Central and each other. Corporates, even those that compete with each other regularly, have not taken advantage of troubled times to disparage each other.
They have worked together to ensure that their members understand the safety and soundness of U.S. Central and the corporate network-meeting together regularly to discuss the future and ways to continue to provide value to their memberships.
More important has been the reaction of credit unions to the crisis, as the vast majority are choosing to keep their deposits right where we need them. Credit unions have adhered to the fundamental principles of our cooperative movement, which exhort us to act on behalf of the whole rather than the sole pursuit of individual interests. As a result, throughout this year the Corporate Network has survived a severe liquidity shortage because of credit unions' belief in the corporate system and understanding of our interdependence.
Here in Georgia, I've been sure to let our members know how gratified I am by their ongoing support. Their level of confidence is possible because of the member-owner structure that gives them direct control, and the resulting years of open and straightforward dialogue that have established strong trust.
The acknowledgment and appreciation for the symbiotic nature of relationships at many levels of the credit union movement is the key to sustaining the value proposition originally envisioned for the Corporate Network.
Greg Moore is CEO of the $1.6-billion Georgia Central. Prior to joining Georgia Central, Moore worked for U.S. Central where he held positions including Portfolio Manager, Asset-Liability; Managing Director, Investment Sales; and Vice President, Relationship Management and Member Services.
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