DALLAS — A slowing market for CU card portfolios has not stopped TNB Card Services, the card portfolio purchasing and processing arm of credit union owned Town North Bank, from continuing to buy. The CUSO reports that it has purchased 45 card portfolios in 2007 and 150 overall.
The latest TNB purchases include Grafton Suburban Credit Union of Massachusetts, Independent Federal Credit Union of Indiana, Western Cooperative Credit Union of North Dakota, County Schools Federal Credit Union of California, and Eastern Maine Medical Center Federal Credit Union of Maine. This series of purchases moved more than $8.4 million in outstanding balances and nearly 8,800 card accounts under TNB's ownership, the CUSO said.
Grafton Suburban Credit Union in North Grafton, Massachusetts, reported that the bottom line was the deciding factor in selling its portfolio to TNB.
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"TNB's was the best offer we received, and we felt it was a fair and rewarding one," said Robert Leist, chief financial officer of Grafton Suburban CU. "We had been considering this for about three years. Balances were shrinking, and delinquencies were a growing concern."
The sale, Leist said, should yield a better card program that benefits the credit union's members and generates more usage and interest. With 12,000 members and assets of $102 million, Grafton Suburban CU is community chartered to serve Worcester County, Mass. The credit union, now more than 40 years old, has three branches.
Independent Federal Credit Union of Anderson, Indiana, took great care in deciding who would buy its card portfolio, observing that it was giving up its "most profitable product."
"We sold for strategic purposes, so we can focus on new products in order to grow," explained Norman Getts, president/CEO of Independent FCU. "We are moving to serve small business owners and diversify our membership and product mix."
Getts said what made the difference in the credit union's decision was TNB's ownership by credit unions. "We wanted to keep it in the family," he explained. "We don't want to associate with a bank."
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