We are moving into a new era of CUSO development. There are many reasons for new strategic prioritization of these entities and the evolution of the model, but first and foremost is the need for scale in our operations. Scale matters more today than it ever has as we compete in the retail banking marketplace against larger and larger competitors.

In today's financial services marketplace, credit unions need to compete across an ever growing number of service channels, with an ever increasing menu of products and price levels that will win in the marketplace and return value to members. These competitive challenges require economies of scale. It is easy to identify the trend as we witness the ever increasing size corresponding service advantages of the banks we compete against. The global, national and regional banks continue to invest in omni-channel solutions, data analytics, segmented marketing, lead generation, mobile and marketplace lending, while maintaining large branch networks, call centers and ATM systems. Even the largest credit unions are growing much faster than the average size credit union as they build brands, create new products and maintain a lower operational cost per account. Scale allows each of these competitors to invest in new opportunities and serve their customers in a manner of their choosing.

The most disturbing brand survey that I have seen in years highlights this trend. JD Powers recently announced that the major banks (Chase Bank, Bank of America and Wells Fargo) are winning in the millennial marketplace because of their use of data and mobile channels. Service is defined by convenience, not in-person transactions, for this incredibly important segment of our market.

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