Wescom CU And PSCU To Launch Credit CardBank
PASADENA, Calif. - (01/24/06) -- Credit union giant Wescom CUannounced Monday it has teamed with PSCU Financial Services, thecredit union cards processor, to start its own credit card bank forcredit unions. Wescom has agreed to acquire Silvergate CapitalCorp., a San Diego financial company, and will use Silvergate'sCalifornia Industrial Loan Company charter to buy and manage creditunion card portfolios, while PSCU will perform the processing. Thedeal, which would position Wescom as the first credit union to owna bank, must still be approved by the California Department ofFinancial Institutions and the FDIC, which provides depositinsurance for state chartered ILCs. Darren Williams, president ofthe $3 billion credit union, said he is optimistic they will winapproval from both regulators for their plans. This issomething, literally, weve been looking at doing foryears, Williams told The Credit Union Journal.Weve talked to a number of credit unions and creditunion organizations and theres a lot of interest in keepingtheir (credit card) programs within the credit union system.The launch of the new credit union cards bank comes as CUNA Mutualand its partners, Corporate One FCU, Certegy and Card Services ForCUs, are working with the FDIC to obtain deposit insurance fortheir fledgling credit card bank, called Union Financial ServicesCorp. The two new credit card banks will join InfiCorp, MBNA, now aunit of Bank of America, US Bancorps Elan Financial, andcredit union-owned TNB Card Services, as competitors in the marketfor credit union card portfolios.