ROSEVILLE, Calif. — After a conversation today with a concerned credit union CEO on what he should be doing with his broker in the midst of the Lehman Brothers bankruptcy filing and Merrill Lynch acquisition, one noted industry expert emphasized “this is not Enron.”

“Members need to hear this,” said Pete Snyder, president of Snyder Consulting Solutions LLC, an investment and insurance service consultation CUSO. “The big issue with Enron, from a human perspective, is that all of the employees lost their retirement plans. Credit unions and members really don't have a tie into Lehman Brothers.”

Even if a financial institution had contracted with Lehman for the firm to be a fiduciary on 401(k) plans for employees, Snyder said there is still no direct tie because the administration would fall outside of the Chapter 11 bankruptcy protection filing.

Snyder said members have a lot of money in insured funds “hopefully at credit unions.” To quell concerns, they can ensure that their asset allocation is in line with the market upheavals, he added.

As for Bank of America's acquisition of Merrill Lynch, Snyder said credit unions might want to watch the strategic direction of these two powerhouses going forward seeing that financial cooperatives only have 6% of market share.

“The move to acquire Merrill Lynch was a proactive move and a synergistic move that gives them both tremendous scale,” Snyder said. “The message to credit unions should be if you're collaborating [with others], continue. If not, start.”

Instant Insights /

Lehman, Merrill Shakeups 'Not Enron'

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