TMG Financial Services, the card portfolio purchasing arm of The Members Group has some card portfolios in which it hopes some credit unions will want to invest.
TMG is as card processing CUSO associated with the Iowa Credit Union League.
TMGFS is offering credit unions the second of its Collateralized Advance Plan offering, a mechanism through which credit unions can invest in the CUSO's roughly $32 million portfolio of credit union issued credit card loans.
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"We think the current economic conditions strongly favor investing in a loan program which can offer competitive yields from a very soundly underwritten investment," explained TMGFS CEO Jeff Russell. "If anything, these days make having a higher yield even more important for credit unions."
Russell noted that TMG's card portfolio, like all CU card portfolios, has a much lower charge off rate than the overall industry and that credit union card portfolios, in general, have a reputation for being soundly underwritten. He also observed that the bulk of TMG's cards come from credit unions situated in parts of the country which are suffering less economic instability and that the organization only buys card loan accounts that are in good standing, meaning the card portfolios arrive "clean" at the CUSO.
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