WARRENVILLE, Ill.–Just as natural person credit unions are billing themselves as trusted financial advisers, corporates want to get the word out that they, too, differentiate themselves as being the trusted source to whom credit unions can turn for disinterested advice.
“For many credit unions, having a trusted business partner on the other end of the transaction adds more confidence than buying from a voice on the other end of the phone that gets paid only if you buy the bond they are showing you,” said James Toliver, executive director of advisory services at MembersUnited’s CUSO Balance Sheet Solutions, LLC. “For many firms outside the industry, the sales process revolves around the concept ‘this is the story and these are the bonds–now pick up the phone and move this stuff out of our inventory.’”
That’s why just as natural person credit unions are hosting seminars and engaging in financial literacy efforts with their members, corporate credit unions are doing the same thing–only at a much more advanced level–for their member credit unions.
“We put investment strategies in our newsletter, we talk to them all day abut investment issues, and we’ve been extremely active in getting out to chapter meetings to talk about the market,” said Cory Johnston, chief investment officer of Georgia Central Corporate CU, Duluth, Ga. “We get a lot of questions about how everything fits together–does what the Fed is doing affect them, how does Bear Stearns impact the credit union world, how does credit market dislocation affect credit unions?”
Southwest Corporate’s Zane Wilson said his corporate is helping credit unions evaluate their risk to make good balance sheet and investment portfolio decisions.
“As an example: during the past six to nine months, we have successfully steered credit unions away from Auction-Rate Securities,” he related. “However, we have noticed that a number of credit unions in our region have invested heavily in these instruments and, unfortunately, they have been unable to redeem them over the past couple of months.
“Creating and offering products that are appropriate for current and future economic conditions is how Southwest Corporate strives to be a valued and trusted partner for member credit unions when they need us,” noted Wilson.
