BIRMINGHAM, Ala. -- Over the last 18 months, the Alabama CreditUnion League had built up a respectable clientele for itsprofessional employer organization services through its CUSO,Credit Union Business Services, LLC.

But the league wanted to turn the heat up a few notchesespecially since it had discovered there is a pent-up demand.

To that end, the league and CUBS voted Feb.16 to purchase CEBCOand CEBCO Staffing, a Birmingham-based professional employer'sorganization and temp-to-perm employment services company. Theacquisition enables CUBS Resources Ltd., the league's umbrellagroup of subsidiaries, to service more than 100 companies and morethan 2,000 employees in 15 states. CUBS is owned by 11 creditunions and the Alabama CU League. At press time, the deal wasexpected to be finalized, said Mark Cooper, vice president ofCUBS.

CEBCO's array of services consist of payroll services, workerscompensation insurance, group benefits, investment and personalinsurance brokers, estate and business succession planning, 401(k)plans, staffing services, property and casualty insurance, andhuman resource services including hiring and firing and drugtesting.

The discussions to beef up the league's PEO services sprang fromfiguring out more ways to help credit unions and serve smallbusinesses with their payroll, insurance and various human andresources needs, Cooper said. With eight clients, PEO servicesweren't new to the league, but one major barrier stood in the wayof expansion.

"We had a solid understanding of how to run a PEO. Our problemwas distribution," Cooper explained.

In the fall of 2006, CUBS began its due diligence processlooking at several local firms before hearing a suggestion from aCU CEO on looking at CEBCO. Some of the owners of the 13-year oldcompany were getting close to retirement and were exploring thepossibility of a sale, Cooper said. What sold CEBCO was itsphilosophy, nearly identical to the credit union industry's mantra."They've built their business on not having customers but havingmembers," Cooper said. "They had built a nice clientele over theyears." CEBCO employees, including Ray Foushee, president and oneof the company's founders, will remain on board. Cooper saidFoushee had planned to retire soon but "changed his mind." TheCEBCO name will also be retained, but it may change down the roadto fit with the several subsidiaries under the league's CUBSResources, Ltd. umbrella.

"We are very excited to have this opportunity to serve creditunions and their business members," Foushee said. "Providing theseservices helps free up the administrative burden for credit unionsand their small business members, allowing them all to focus ongrowing their business, as opposed to worrying about the everydayregulatory issues of operating their business."

Cooper said as far as he knows, the purchase makes CUBS the onlyfinancial institution-owned professional employer's organization,administrative services organization, payroll, temp-to-perm agency,and insurance agency in the United States. CEBCO Staffing currentlyhas 25 clients and with Alabama's heavy auto manufacturinglandscape, Cooper foresees opening offices directly in creditunions to offer temp-to-perm employee assistance.

"What we're contemplating is putting together a teller pool forwhen a credit union needs someone to come in during peak periods orif they lose an employee," Cooper explained. While CUBS has alreadyreceived inquiries from credit unions in other states, Cooper saidfor now, the focus will be on developing a presence in Alabama eventhough CEBCO is licensed to do business in 14 states. Over the next90 days, CUBS will be converting its current clients so everyone ishoused in one area. Distribution efforts to CUs, select employeegroups and small businesses will begin almost immediately afterthat, Cooper said. CEBCO's purchase, price was not disclosed butCooper said CUBS "will see more positive cash flow immediately.""Cost-wise, we already had enough money to put down on [CEBCO]without having to borrow a lot," he offered. "We think we can payoff the loan in under three years." CUBS is also willing to helpother PEOs that are looking to grow, Cooper said.

"The credit unions in Alabama are working with so many smallbusinesses. One credit union has 800 SEGs. This is truly anexciting time for credit unions to help small businesses."[email protected]