3BELLEVUE, Wash. — ShareBuilder Corp., an online brokerage company that built its presence from alliances with credit unions, is having to rethink its co-branded partnerships after being bought by ING DIRECT in November 2007.Roughly 125 credit unions were clients of ShareBuilder, known for its low-cost, online brokerage transactions and automatic investment plans. Today, those numbers have dropped to roughly 50, according to Kathy Schanno, a spokeswoman for ShareBuilder from ING DIRECT. The reasons for the decline are hard to pinpoint but as a result, ING DIRECT is modifying its co-branded partnerships, Schanno said."It's been a period of adjustment," Schanno acknowledged, following the acquisition. "Our programs with credit unions have historically been co-branded programs. Historically, ING has pursued a direct distribution. We're still working through funding and finalizing the future of this space. There will be programs in place. We're just not sure how many there will be."Schanno said "quite a few" credit unions just chose to end their relationships with ShareBuilder; some were not comfortable with doing business with a bank. ING DIRECT's parent company is ING, an Amsterdam, Netherlands-based global financial services company with more than 85 million private, corporate and institutional clients in more than 50 countries. Launched in 2000, the $81 billion ING DIRECT has more than 7.3 million customers. She added, "[there's] been a bunch of different situations why credit unions left," but she did not know specifics.The $4.1 billion Patelco Credit Union was one of the first seven credit unions to offer ShareBuilder's services in 2000, said Scott Waite, senior vice president/chief financial officer. Members made more than $40 million in online trades through 166,000 transactions over the eight-year time period. Waite provided Credit Union Times with a Dec. 5 letter from Schanno saying that "the change in ownership…has resulted in directional changes in our program." ShareBuilder said it will not renew Patelco's co-branded services agreement and asked that its links and banners be removed from the credit union's Web site by Jan. 15, 2010, the end of Patelco's contract."Patelco has been very pleased with our partnership with ShareBuilder, and we are very sorry that it is coming to an end," Waite said, adding it still has another year to be able to offer the online brokerage's services. "It was a great idea to help our members take advantage of affordable monthly investing in the equity market."Schanno did not respond to questions by press time on whether ShareBuilder had sent nonrenewal notices to other credit unions. ShareBuilder has not tracked the number of credit union assets managed by ING DIRECT, but they, along with banks, account for 12% to 15% of all its financial service-based products, according to Schanno."We value our credit union partners. There are and will be programs in place for credit union members through our co-branded programs," assured Schanno, who has been with ShareBuilder for nine years. "[ING DIRECT's] been a wonderful fit for us. We're both about bringing back the American concept of saving."The ING conglomerate has six lines of business around the globe: insurance Europe, insurance Americas, insurance Asia-Pacific, wholesale banking, retail banking and ING DIRECT. For fiscal year 2007, ING DIRECT accounted for 6% of the company's profits, tying with insurance Asia-Pacific for last place compared to the other subsidiaries, according to company data.Under the terms of the 2007 agreement, ING DIRECT acquired 100% of Seattle-based ShareBuilder's outstanding equity-related interests for $220 million. The company also absorbed 661,000 of ShareBuilder's customers.Schanno said because of backing from the ING DIRECT brand, ShareBuilder has been able to add to its product lineup real-time quotes and a more streamlined process for easier account setups. In April 2007, ShareBuilder partnered with Walmart to offer Easy Investing, a recurring investment program, to the retail giant's customers and employees. Founded in 1999, ShareBuilder signed a lease in November for a 130,000-square-foot facility in Bellevue, Wash., to accommodate its growth, according to ING. Staffing is up 60% and new account growth has doubled since the merger, according to a Nov. 25 press release.Still, ING CEO Michel Tilmant reported that the third quarter "was extremely challenging for financial institutions" in a deteriorating marketplace. As a result, the company reported its first ever quarterly loss. In an Oct. 19 press statement, Tilmant said ING planned to focus on strengthening its core capital, saying the transaction "does not dilute our existing shareholders while providing additional security to our 85 million customers."–[email protected]