The Quincy, Mass.-based 9Squid Private Markets, a TAPP Engine subsidiary, introduced an AI-powered platform that streamlines the process of converting loans into investable products for credit unions and other community financial institutions.
U.S. credit unions have approximately $2.4 trillion in assets and more than $1.7 trillion in consumer loans, according to the NCUA. Community financial institutions, including community and regional banks, have an additional $6 trillion in assets and more than $4.1 trillion in consumer, small business and commercial loans, according to the Independent Community Bankers of America. Despite this, securitization remains underutilized due to cost, structural complexity and minimum size thresholds, 9Squid leaders said. As a result, many institutions have been excluded from institutional private credit markets.
9Squid is designed to reduce these barriers and enable faster, more efficient access to institutional capital.
"Community institutions play a central role in capital formation, yet many have been priced out of securitization markets," Tosin Osunsanya, founder and CEO of TAPP Engine, said in a prepared release. "9Squid brings securitization and balance sheet modeling in an AI-powered platform built for credit unions and community finance institutions of all sizes. It provides a repeatable and efficient path to institutional capital while preserving cooperative governance and relationship banking."
The platform helps institutions see how different securitization choices could affect their finances prior to execution, according to 9Squid, letting them explore potential impacts on cash flow, capital, earnings and risk, and enabling more disciplined decision-making. Securitization then becomes a tool for ongoing balance sheet management.
In reviewing the 9Squid platform, Michael Massey, president of TDECU Holdings, which manages TDECU's subsidiaries, said, "What stood out was the ability to understand balance sheet outcomes before committing to a transaction. That level of visibility allows credit unions to evaluate securitization as a practical and repeatable balance sheet strategy."
Five credit unions are in the initial 9Squid platform pipeline, with broader onboarding planned for credit unions and community finance institutions of all sizes, according to the announcement. The names of the five credit unions have not yet been disclosed.
The platform currently supports securitization of personal loans, auto loans and home equity lines of credit using regulator-aligned structures.
TAPP Engine modernizes capital formation, wealth management and liquidity infrastructure for credit unions, community finance institutions and regional financial institutions. It also runs a CUSO, WealthCabinet, which is comprised of seven credit unions: TDECU, Mission Fed Credit Union ($7.1 billion, San Diego, Calif.), Desert Financial Credit Union ($9.5 billion, Phoenix, Ariz.), MSUFCU ($8.3 billion, East Lansing, Mich.), WSECU ($5 billion, Olympia, Wash.), Service Credit Union ($6.4 billion, Portsmouth, N.H.) and SECU ($5.7 billion, Linthicum, Md.).
Joyce Moed can be reached at joyce.moed@arc-network.com.
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