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CLEARWATER, Fla. – Despite the amount of attention and advertising credit union sales of their card portfolios to banks have gotten in the last two years, the topic of card portfolio sales still did not rank high among credit union CEOs’ list of card concerns, according to Robert Hackney, CEO of the Florida-based Card Services for Credit Unions. CSCU is the association that represents credit unions that process their card transactions through the Alpharetta, Georgia-based Certegy. The association has been growing over the past year, growing about 10% to represent 8.3 million card accounts from 2,500 credit unions across the country, the association reported. Hackney reported that the card portfolio sales had come in significantly lower in Certegy’s annual CEO survey about card issues. The top five concerns facing CEOs about their card portfolios were competition from other card issuers, card usage among their card holders, penetration of their card portfolios among their members, profitability of their card portfolios and activation of their issued cards, he said. Card portfolio sales came far down the list, he said. Hackney can take some comfort from the survey results because, as CEO of CSCU, he holds a leadership position among credit unions which have come under increasing pressure to sell or otherwise give up their involvement in the credit card business. While he pointed out that the definition of a “small card portfolio” among credit unions was open to some dispute, Navy Federal has the largest credit union card portfolio but, in the broad industry sense, is relatively modest, he said. Most of CSCU’s membership is made up of credit unions with smaller card portfolios and which might be feeling the pressure, said Hackney. It’s no secret that credit unions have to manage their card portfolios as both a relationship and financial asset, Hackney said. What might be news to some credit unions is how much easier that management task has become using tools like CSCU’s Virtual Card Consultant, he added. “With the consultant a credit union card executive can have 15 detailed reports about their card portfolio’s performance, strengths and weaknesses in five minutes,” he said. “Reports that don’t need to be interpreted and can be readily understood,” he added, though he admitted that, even with the information, someone still has to be responsible for making decisions to address the portfolio’s weaknesses and build on its strengths. CSCU, through its association with Certegy, can offer a turn-key solution when it comes to the hands-on work of managing a portfolio, Hackney said, but managing a turn key solution still requires time and effort and attention. Someone still has to make a decision about whether to offer a rewards program; whether to increase credit lines and how much; whether to offer balance transfer offers or courtesy checks – some some credit unions can find that daunting he said. But the good news is that credit unions that take the trouble to manage their portfolios have consistently found them an important tool to both build the relationship with their members and their profit margins as well. Credit cards with solid customer service are something that can stick in credit union members’ minds, Hackney pointed out. If the credit union has helped out a member with a credit line increase or otherwise acted to make their card more attractive, that can really keep a member happier with their credit union. He cited the experience of Randolph Brooks FCU, a $1.9 billion institution that is based in the San Antonio, Texas area. “They are an outstanding success with their card portfolio, unsurpassed really, because they make their portfolio a central aspect of their credit union relationship,” he said. That’s something any credit union can do, no matter how large they or their portfolio are, he said. [email protected]

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