Southwest Corporate said it is seeing increased interest in reverse inquiry, structured investments, which are certificates structured according to a CU's balance sheet needs and which have a $5 million minimum.
During 2004 Southwest Corporate said it created 50 reverse inquiry structures totaling more than $372 million. To date this year it has responded to13 reverse inquiries for $148 million and expects to pass the 2004 activity, according to Cynthia Shi, manager of Portfolio Management. SWFCU said the structured certificates allow credit unions to earn between 10- to 15 bps higher than comparable agency instruments.
Even as lending environment continues to improve, Shi said there is still a substantial amount of investment funds at credit unions.
"A lot of that money is being invested in agencies, and we want to get the point across that our structured certificates usually beat agencies by 10 to 15 basis points. And through the reverse inquiry process, we are often able to provide credit unions with the maturity structure they need as well," Shi noted.
