SAN DIEGO – For the first time since the company's launch in 1996, CUSO Financial Services, LP's profitability resulted in a pay out of $500,000 in profit distributions to its 19 limited partners and reaching a $1 million profit goal. CFS, a credit union investment advisor and broker dealer, finished 2002 with its revenues increasing by nearly 50% to $36 million and net profitability increasing 330% to more than $1 million "in a year when financial markets were down and the economy was in a slump," said Valorie Seyfert, CFS president/CEO. CFS works with 65 credit unions, has 40 employees, 130 branch offices and more than 250 licensed representatives. Seyfert attributed the company's growth to existing credit union investment programs that adopted strategies developed by CFS' "top producing" partners. She said that 60% of their revenue growth came from its existing programs and the remainder from new programs such as 401(k)Your Way and TOPs trading program. "The magic number we held as our goal for profitability last year was $1 million," Seyfert said, adding "we are extremely pleased we were able to meet and even exceed that goal." CFS's profitability in 2002 also resulted in the company paying out $500,000 in profit distributions to its 19 limited partners, who will receive pro rata shares in accordance with the amount of ownership they have in the company. This is the first year CFS has paid out a dividend to it partners. Looking toward the future, Seyfert said that CFS plans to increase revenues this year primarily from continued growth of existing programs, from new products and services introduced last year and fully deployed in 2003, and by the addition of new programs. In addition, Seyfert anticipates opportunities for CFS to expand its distribution efforts by offering back office services to other brokerage firms that are seeking electronic capabilities for integrated online and full-service investment programs. A keen eye will be kept on such factors as market and interest rate fluctuations, changing regulatory requirements, product trends, and investor preferences for 2003, Seyfert said. "We must be flexible and be prepared to offer products that assure the investors' needs and expectations are met," she said. "With margins becoming increasingly smaller, we must continue to improve efficiencies, identify new sources of revenue, leverage existing technology and other capital investments, and expand distribution of existing and new products and services." With that in mind, CFS had adopted `Second to None' as its marketing slogan for 2003, which Seyfert said continues the company's mission of positioning credit unions as "the best providers of financial services" in the marketplace. -

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