TMG Financial Services, the credit card portfolio purchasing and issuing arm of The Members Group, reported that 34 credit unions have sold the firm their credit card portfolios, which TMG has continued to issue under agent agreements with the CUs. This means the Des Moines, Iowa, based firm issues more than 40,000 cards.
The organization also reported that ongoing interest on the part of credit unions in investing in credit cards has led to it having the capital it needed to buy them. Over the course of just over a year, the CUSO says participating credit unions have invested more than $60 million in the card program.
Some of the interest has arisen from credit unions' wanting to see assets remain with credit unions, the firm reported, but participating credit unions have also invested to take advantage of the fairly favorable investment rates. For example, on Oct. 19 a one-year certificate of deposit was priced at 1.99%, TMG reported. A two-year commitment through investing in the program was priced at 4.00%.
These rates have drawn a wide variety of credit unions, with more than 66% of participating CUs still owning their portfolios. Fully 19% have invested more than $.2.5 million with TMG and 15% of those investing have also taken an equity position in the CUSO, TMG said.
