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CHICAGO – The timing seemed right for Coastal Federal Credit Union to make some long-term adjustments to its investment services program. The $1.5 billion credit union recently went from a managed to a dual-employee arrangement under CUNA Mutual Group’s MEMBERS Financial Services program. The announcement was made at CUNA Mutual’s MEMBERS Financial Services Management Conference held here Aug. 1-3. Coastal moved its financial services program from a managed employee staff to a dual-employee staff; planned to at least double staff size; and built a Financial Advisory Center dedicated solely to investment and trust services. The managed employee program had provided Coastal with the investment programs, licensing, staffing and payroll since 1992. With the changes, MEMBERS Financial Services would continue to provide the programs and licensing under the new dual-employee program but Coastal would have more control by doing all the hiring and setting the salary and commission levels, said Chuck Purvis, Coastal FCU senior vice president. “CUNA Mutual Group had been encouraging us to go to the dual employee program, but we initially decided not to act,” Purvis said. “Eventually we realized we needed to make the commitment and take away the protection offered by CUNA Mutual. It was easy to let them take all the risk, and we would take a smaller percentage.” A critical step was increasing the number of financial advisors and raising the bar on their qualifications. Purvis said they had only two to three people at any one time, and that made it difficult since Coastal had expanded to 21 facilities around North Carolina. They also required their financial advisors to have, or be working toward Series 7, 63 and 65 investment advisor licenses, with a Certified Financial Planner (CFP) certification being preferred. Coastal also built its new Financial Advisory Center, which opened in March. It has a separate entrance from the rest of the credit union and has an ambiance that aims to help members feel comfortable and trusting when they are making decisions about their life savings, Purvis said. Still, “It’s not about the brick and mortar, it’s about the attitude with which we approach the member relationship,” Purvis said. “If we put their interests first, they will place their trust in us. We know our members are looking for advisors and planners they can trust. If we provide this level of service to our members, we’re confident they will purchase investment, trust and insurance products through us.” Purvis said they have also identified a target range of members with $100,000 to $2 million in investable assets, adding most banks and brokerage firms won’t handle this level because it is too small. Nearly 28,000 of Coastal’s member households fall within that range. While Coastal’s dual-employee program officially launched July 1, it’s been operating since Jan. 1. Through June, business is up 12% versus 2004 with two advisors. Purvis said. The CU’s goal is to have six advisors to assist members. Getting the word out to members has indeed started to pay off. Purvis said they held five seminars in April and had more than 250 attendees. Shortly thereafter, they closed a $1.9 million trust account that resulted from a seminar. Credit unions, regardless of their size, can have advisors on hand ready to assist members with their investment goals, he suggested. “If you think an investment program is just as important to your members as a mortgage or an auto loan, then hire the right people and pay them,” Purvis said. A shift in how members view their financial needs is just the motivation for credit unions to meet those needs, said Chris Rafanan, CUNA Mutual Group, Southeast Member Services Officer. “More and more credit union members are taking a hard look at their financial lives, and they are looking for a credit union that can take control of their investments,” Rafanan said. “Members are looking for someone who cares about their hopes and dreams and is not just selling products. Coastal Federal Credit Union is a shining example of this model.” [email protected]

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