Skip to main content

CUSO Investments Keep Climbing

 

Source: Callahan & Associates
 
  • Since the National Credit Union Administration began tracking the amount of money invested in credit union service organizations (CUSOs) in 2010, credit unions have allocated a significant amount of funds toward these organizations. CUSOs have access to capital now more than ever, and credit unions are interested in investing. 

  • Credit union investments in and loans to CUSOs have risen by 7.8% since the start of the COVID-19 pandemic, with investments comprising 80.9% of the total funds as of March 2022.

  • Per NCUA regulation 12 CFR § 712.2, federally chartered credit unions can only invest in or lend to CUSOs 1% of the amount in paid-in share accounts and deposits based on their last year-end financial report. This rule makes it difficult for credit unions with low assets to allocate any significant funds to CUSOs, even if those investments could be valuable. Of the 1,958 credit unions with an aggregate cash outlay interest in a CUSO at the end of the first quarter, 645 are under $100M in assets. These small institutions comprise only 32.9% of CUSO-investing credit unions, but makeup 63.4% of all credit unions in the country. More than 150 of these smaller CUs have investments of $10,000 or less. For now, CUSO investing is predominantly a large credit union game – though small shops can still benefit from CUSO service offerings.

  • Non-interest income data from Callahan & Associates shows that credit unions that reported income deriving from CUSOs in 2020 saw a 37.2% year-over-year increase in their CUSO earnings by December 2021.

  • All things considered, CUSOs have proven to be a great alternative for credit unions to increase and diversify their non-interest income, while at the same time investing in an industry that is specifically targeted to serve credit unions and their members.

Comments

Post a Comment

Please no profanity or political comments.

Popular posts from this blog

Let the Truth be Told - Why a New NCUA Rule Could Jolt Credit Union Innovation

The National Credit Union Administration has finalized a rule to improve board and executive succession planning within the credit union industry. This strategic move aims to curb the trend of mergers driven by technological stagnation and poor succession strategies, ensuring more credit unions maintain their independence and enhance their technological capabilities. By Ken McCarthy, Manager of marketing communications at Tyfone Credit unions are merging out of existence because of an inability to invest in technology, the National Credit Union Administration Board wrote when introducing its now finalized rule on board succession planning. The regulator now requires credit unions to establish succession planning for critical positions in their organizations. But it’s likely to have even wider effects, such as preserving more independent charters and shaking up the perspectives of those on credit union boards. “Voluntary mergers can be used to create economies of scale to offer more or ...
Post a Comment
Read Complete Article HERE>»

Armand Parvazi MBA CUDE - Last Friday marked his last day with New Orleans Firemen’s Federal Credit Union.

It’s been an incredible journey, but it’s bittersweet to announce that Friday marked my last day with New Orleans Firemen’s Federal Credit Union. We've accomplished so much together in my six years as Chief Administrative and Development Officer. Some of the highlights: Implemented a data-driven marketing strategy that delivers over 1,800% annual ROI. Developed automated triggers to ensure members receive the right offers at the right time. Grew assets by 61% and increased products per new member from 1.88 to 2.62. Converted online banking to enhance the member experience. Introduced a loan origination system for faster and more efficient loan processing. Transitioned to a mobile-first financial institution to meet members where they are. Pioneered the first Cancer Care loan pause program in the nation (in collaboration with Andy Janning ) Secured nearly $17 million in grants for our impactful work. Expanded our field of membership to 35 parishes and counties and added numerous fi...
Post a Comment
Read Complete Article HERE>»

Biggest Social Security Changes for 2025

  Chris Gash Facebook Twitter LinkedIn Monthly payments are going up, and drop-in service at SSA offices is largely going away The  cost-of-living adjustment  (COLA) may be the most widely anticipated way Social Security changes from year to year, but it’s far from the only one. Inflation, wage trends and new policies directly affect not just the more than 68 million people receiving Social Security benefits but also the estimated 184 million workers (and future beneficiaries) paying into the system.  Here are seven important ways Social Security will be different in 2025. 1. Cost-of-living adjustment Inflation continued to cool this year , resulting in a  2.5 percent COLA  for 2025 for people receiving Social Security payments, down from  3.2 percent in 2024 . The estimated average retirement benefit will increase by $49 a month, from $1,927 to $1,976, starting in January, according to the Social Security Administration (SSA). It’s the lowest COLA i...
Post a Comment
Read Complete Article HERE>»