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ST. JOSEPH, Mo. – With residents of the Gulf region and businesses trying to recover from Hurricanes Katrina and Rita, one piece of that recovery effort for credit unions and other financial institutions is locating members -many of whom are displaced to other states – and reconnecting with them to make arrangements for repayment of loans they have with their credit union. It’s never easy for members dealing with personal losses including jobs and other sources of income to deal with outstanding loans. Systems & Services Technologies Inc. has been working with credit unions over the last two years providing them loan servicing outsourcing for auto and “auto-like” type loans such as RVs and equipment vehicles. In the wake of the devastation left by Hurricanes Katrina and Rita and the huge numbers of evacuees displaced around the U.S., the third party servicer is extending its assistance to help credit unions and CUSOs locate their members and assist with financial arrangements. SST, formerly a private company, was acquired by JPMorgan Chase in 2003 and now operates as a wholly-owned subsidiary of the $3 billion JPMorgan Worldwide Securities Services division. It handles more than $6 billion in active receivables on automotive loans, as well as marine, motorcycle and power sport vehicles, signature loans, consumer receivables and manufactured housing. The company also provides back-up and master servicing on ABS, term and warehouse structures. SST VP & Product Manager Marie Persichetti explained that prior to the acquisition, SST primarily serviced subprime loans as well as did backup servicing. Since being acquired by JPMorgan Chase it’s expanded its business to prime loans. SST currently counts four credit unions on its client list – Persichetti said the names of the CUs were confidential. It’s also “engaged in talks” with U.S. Central and its auto lending subsidiary Charlie Mac about how it could structure a relationship with the corporate that could possibly include servicing and securitizing auto loans. Persichetti stressed that “we’re just talking with them at this point.” With so many credit unions in the Gulf region dealing with the aftermath of Katrina and Rita, Persichetti said SST has been talking with borrowers on a daily basis of CUs the company has relations with “and they’ve been telling us about their struggles and how they haven’t been able to reach their financial institution. As we started to listen to them and read about things concerning helping members get through these obstacles, we realized we have the ability to help them.” SST, she said, also has the ability to help credit unions get in touch with members who have loans with their credit union and make financial arrangements. To facilitate this, for example, might necessitate getting a list from credit unions that would include the last address and phone number known for the particular member. SST could also use the Red Cross displaced persons lists to try to reach people. Persichetti said SST has been talking with various auto lending CUSOs and credit unions “to let them know we’re here and we have a myriad of services we can provide where they’re needed. This is our business. We’ve been in business the last 10 years reaching people who are typically difficult to reach. Sometimes it’s not an easy situation to find a borrower. We have the skill sets and resources that could lead us to try to reach these members.” Persichetti said she respects that “clients have different ideas of how they want to handle their borrowers, and that’s the clients’ decision, not ours. Our primary concern is we’ve located the borrower, then we find out the status of their loan as far as delinquency of payment is concerned. We take direction from the lender on how they want us to proceed.” She added that, “Despite the conditions many of these borrowers are dealing with, in many cases we’re finding they don’t want to skip out on making loan payments and want to keep in good standing with their credit union.” So far, Persichetti said SST has been “pretty successful” reaching borrowers of those credit unions the company has relationships with, and some borrowers have also contacted SST directly. For those CUs that don’t already have a relationship with the company, she said SST might be able to set up a temporary URL for the credit union that directs members to the SST Web site. “As a third party service provider we provide the types of services that many credit unions affected by Katrina and Rita are struggling to provide now to their members. If we can help them provide that on an interim basis until the credit union and members are back on their feet, we’d like to do that,” said Persichetti. -

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