SE Corp Won't Ask Members to Pony Up Capital
Southeast Corporate Federal Credit Union is among the lucky wholesale credit unions that don't face an immediate need to recapitalize.
In his first interview as president/CEO of the $3.3 billion institution, Brad Miller told Credit Union Times that at least initially, he will only ask members to convert member capital shares to tier-one capital.
"As part of the new business model and value proposition we're working on, obviously we have to look at our long term capital structure," Miller said. "But we can manage our balance sheet down to the capital that's there to support it."
Because the Tallahassee, Fla.-based cooperative already has a separate investment business and broker/dealer, it has a place to transfer assets off its balance sheet, allowing it to meet capital requirements while still holding on to member relationships.
Though he said there's no detailed plan in place yet, Southeast Corporate is leading discussions with other corporates, particularly on a regional basis, to "evolve the corporate business model." Proposed changes include cooperative back office and operational solutions and the sharing of "best of breed" products and services, while maintaining local member service support.
Such consolidation may involve mergers, but Miller said he thinks corporates could also find ways to collaborate while retaining their corporate identities.