SAN DIEGO — Small credit unions with limited resources to offer investment services to members have another resource to turn to.
CUSO Financial Services, LP has launched an investment consortium program in which an investment representative works with each of the respective credit union staffs to define the best offerings for the members. With one advisor typically supporting three to five credit unions, he or she spends at least one day a week at each credit union office and is available by phone for private appointments, according to CFS. The CUSO's dataVISION technology platform provides back office information for regulatory compliance support and also offers an individual registered representative user interface and details for each investment client and their credit union.
Three Georgia credit unions are the first to take part in the new consortium. They are $34 million CORE Credit Union, $71 million Fort Stewart Georgia Federal Credit Union and $56 million Georgia Heritage Federal Credit Union.
"We've learned from CFS that members who use a credit union's investment services typically have larger deposit and loan balances than those who don't," said Bobby Michael, president/CEO of CORE. "We also wanted to provide the program to make sure our members get the attention they deserve when it comes to their retirement funds."
Valorie Seyfert, president/CEO of CFS, said the broker-dealer and registered investment advisor analyzed the small credit union market and determined that a new model was needed to assist them with limited resources.
"As a partner to the credit unions, we felt it was important to provide the kind of investment support they need, no matter what size they are," Seyfert said. "With these consortium programs we bring competitive advantages to our credit unions to increase assets beyond deposit accounts. The credit union members are the ones who really benefit the most by getting high quality investment advice and the personal touch offered by credit unions."
Seyfert said in light of the challenges faced in developing economies of scale, many smaller credit unions have foregone the opportunity to offer investment services to their members. However, as competition for member assets has increased, some credit unions have found that the lack of comprehensive investment and financial planning support has impacted the credit unions' ability to retain not only their members' investment assets but also core assets, such as savings accounts and loans. As a result, CFS developed the consortium model for small-to-mid-sized credit unions in relatively close geographic areas that allows them to share a CFS-trained registered representative.
"We achieve structural efficiencies, yet maintain program differences that support the personality and brand of each credit union in the group," Seyfert said.
CFS serves more than 100 credit unions nationwide and has more than 300 licensed representatives.
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