The payment processing CUSO, headquartered in St. Petersburg, Fla., has posted a dividend of more than $20 million in each of the last five years. In addition to the dividend, financial savings of $12.6 million were passed along throughout 2008 in the form of lower costs, creating a total benefit to members of more than $58 million for the year, the CUSO reported.
PSCU reported that $35 million of the distribution came from the sale of Visa and MasterCard stock. PSCU passed all the proceeds of the stock sale back to its member credit unions.
The CUSO also reported that its revenue for the year, absent the stock sales, came in at $633 million, more than 12% over 2007. PSCU attributed the gain to more use of its core payment processing products and services.
"The root of our financial accomplishments is greater usage of our core services: credit, debit, online bill payment and contact center support. We also posted dramatic growth in member satisfaction and overall leadership within our market segments. And we achieved one of our key objectives, financial value creation of $61 million, through price reductions, dividends, proceeds from stock sales and net income," said David J. Serlo, president/CEO of PSCU Financial Services. He added that the CUSO is looking to relieve some of CUs' financial pressures.
"This difficult economy can be the perfect storm for our industry. It's time for credit unions to expand programs and offer new services that drive members to make their credit union their primary financial institution. That loyalty will boost revenues and reverse the current trend of decreasing return on assets."
The cooperative reported that it processed more than 950 million credit, debit and bill payment transactions, a 17.4% increase over 2007. The total number of accounts serviced by the company grew by more than one million to 13 million, representing an 8.6% jump over 2007. In addition, the cooperative's contact center handled 16 million calls, or 1.7 million more calls than the previous year.
Breach of Contract Suit
Hits Guardian CU
The Central States Mortgage Co. bankruptcy in Wisconsin has had more legal fallout in the form of a breach of contract claim against one of the 25 credit union investors.
"It's really just a frivolous suit without any merit whatsoever," declared Steve Wesson, president/CEO of the defendant Guardian CU of West Milwaukee. Wesson is accused in state court of violating a management pact and retention bonus deal relating to the planned merger with the $190 million Prime Financial CU of Cudahy, another Central States investor.
The suit brought by Richard Koenig, a former chairman of Central States and ex-president/CEO of Prime Financial, contained untruths, said Wesson regarding the proposed 2008 merger between the two Milwaukee-area CUs.
Media reports said Koenig had signed a 10-year contract with Guardian CU to hold a top management slot in the new CU and proposed CUSO, a point denied by Wesson suggesting it was ironical since the suit is "being brought now, five months after we ended the merger talks." Koenig was not immediately available for comment.
Both CUs had suffered loan losses relating in part to the March 9 Central States collapse, but Wesson said his $280 million CU is now in better shape though it did lose $2.3 million last year. Prime Financial, which lost $8 million in 2008, was conserved by the NCUA and state regulators in February.
MEMBERS Trust ETFs
Garner Top Ranking
Barclays Global Investors' iShares has named MEMBERS Trust Co. 2008's top manager of exchange-traded funds in the country.
The company was ranked No. 1 for its income focus 25% equity ETF model and No. 9 for its 40% equity ETF model.
The top holdings in MEMBERS Trust's income portfolio includes various iShares funds. In 2008, the portfolio had a 0.8% return with $10 million in assets under management. The conservative portfolio also includes iShares funds. Last year, it had a negative 7.2% return with $23 million in assets under management. The respective returns were ahead of many others in the Barclays' ranking, according to performance data.
Rounding out the top 10 ETF managers for 2008 were Avatar Associates, New Frontier Advisors, Astor Asset Management, Adviser Investments, Efficient Market Advisors, Tactical Allocation Group and Braver Wealth Management. Some firms were ranked more than once for other portfolios.
MEMBERS Trust said it is the only credit union entity to earn a listing in Barclays' inaugural ETF Managed Solutions Guide, which launched earlier this year.
Western Sun CEO Weise
Retires; Taylor Promoted
Larry Weise, a 28-year veteran of the Oklahoma credit union industry and a former chairman of the Oklahoma Credit Union League, has retired as president/CEO of Western Sun FCU.
Moving up to the top slot at the $100 million Western Sun in Broken Arrow is Robert Taylor, chief financial officer for last seven years.
Weise, whose retirement was effective March 31, began at Western Sun when the CU had one branch, 6,000 members and a closed charter. Today as a community charter, it has 19,000 members and six locations across eastern Oklahoma.
Weise has been a member of the Oklahoma League board 17 years and is former chairman of CUNA Mutual Group's Policyholders Council. He is also a member of the league's Credit Union Advocacy Task Force and the TNB Presidents Council.
Taylor has been with Western Sun for 16 years. Prior to joining Western, Taylor was lending supervisor of Williams Employees CU and vice president at Bank of Oklahoma NA.
Florida CUs Sponsor
In a cooperative effort using billboards, the Central Florida Chapter of the Florida Credit Union League is taking the lead this spring in launching a media awareness campaign developed by the league staff in 2008.
"We're getting very good cooperation so far from the CEOs of participating credit unions," said Eddie Sanabria, Jr., chapter president. Twenty-eight billboards have been arranged with Clear Channel Outdoor Advertising of Phoenix.
The campaign, "The Credit Unions Make Sense," aimed at increasing CUs as the primary financial institution."
Sanabria, who also is vice president of risk management at the $1.2 billon CFE CU of Lake Melbourne, said the campaign should go far in promoting the credit union difference at a crucial time for the industry.