MIDDLETOWN, Penn.-Corporate CUs have had to make a number of adjustments to their product mixes and the services they offer, especially as closure of U.S. Central leaves a void.
Jay Murray, president and CEO of Mid-Atlantic Corporate FCU, said he is focused on making sure services are at "cooperative" pricing levels.
"As a particular service grows we are able to work toward better prices as more credit unions support the service," he explained. "We really emphasize the more credit unions collaborate and use joint buying services, for example, the better price we can offer."
According to Murray, Mid-Atlantic tries to operate well enough to remain compliant with new regulations and capital standards, but still emphasizes giving back to the credit unions it serves.
"We offer balance sheet management, and consulting through our CUSO, myCUservices," he said. "We offer overnight funding, plus purchases of securities and certificates of deposit through a brokerage."
David Brehmer, president and CEO of First Carolina Corporate CU, Greensboro, N.C., said the loss of the corporates' wholesale credit union caused major changes.
"There is no U.S. Central now, which we used to use for overnight deposits and certain payment products, plus our major line of credit," he said. "So now we have had to form other relationships for lines of credit."
The biggest loss is the aggregated balances that could be used for liquidity purposes, Brehmer continued. He said there was an "extremely efficient" system that the corporates used to make loans to natural-person credit unions.
"We now have to generate liquidity from our balance sheet or from other sources," he said. "The primary reason our member credit unions recapitalized was we offer them lines of credit and a good option for short-term deposits and settlement services."
CUSO Services
Lee Butke of Corporate One noted his Columbus, Ohio-based corporate has long had a "stable base" of outside products and services.
"We have a large cards program of credit and debit cards, we offer clearing of share drafts, and our Check 21 product has tremendous penetration," he said. "ACH receipts has been around a long time, and now we are adding a new ACH package."
Corporate One also offers brokerage services, as well as Alliance One, a national ATM service. Thanks to its merger with Tallahassee, Fla.-based Southeast Corporate, Corporate One acquired two CUSOs, which he said has allowed it to begin building programs in other areas such as business lending and participation loans.
Meanwhile, it has a relationship with Accolade, a registered investment advisory service for credit unions that offers insurance brokerage for bond coverage for CUs, and has a partnership with Sallie Mae, the student lender, to help offer private student loans to credit unions that do not show up on their balance sheets.
"Our product line has gotten bigger, deeper and stronger," Butke declared. "We never relied totally on the balance sheet and had a few loss leader products on the side-these are a key part of our aggregation activities. Most of our investment products tend to be government agency bonds or government-backed CDs. It is a conservative group that only is what credit unions legally are allowed to buy."
