The bid by the Iowa Credit Union League to purchase an Arizona bank represents a "unique structure and relationship" the league has with its corporate but with uncertain application for the rest of the system.
That was a message delivered Tuesday by Roshira Holub, the chairman of the American Association of Credit Union Leagues, discussing a surprise Federal Reserve Bank application by the Iowa League to form a bank holding company to purchase CrediCard National Bank of Tucson.
Noting that the Iowa league application is "exploratory" in nature with the league possibly pursing other options to deal with the corporate crisis, Holub stressed in a statement the special integration and "subsidiary structure" the league has with the $94 million Iowa Central Corporate CU of Des Moines.
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As a small corporate, its structure and close links to the league has allowed it to serve small Iowa CUs affordably but now "with uncertainty" reigning in the corporate network, "it is logical to assess the current business model and alternative models to provide competitively priced critical settlement and payment services to Iowa credit unions," she wrote.
But whether other state leagues with large numbers of small CUs might piggyback on the bank charter idea, Holub said most other leagues "do not have that type of relationship with their state corporate and therefore the model would not necessarily apply." Besides serving as head of AACUL, Holub is also president/CEO of the Missouri Credit Union Association.
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