MADISON, Wis. (11/4/11)--With Bank Transfer Day arriving tomorrow, credit unions are searching for ways to invest their increased level of deposits from adding new members. To meet that need, CUNA Mutual Group, through its registered investment advisor affiliate, MEMBERS Capital Advisors (MCA), is expanding its Credit Union Investment Advisory Services (CUIAS) program.
The program aims to help credit unions improve their financial performance through investment portfolio management and strategy.
"CUIAS takes the securities selection, execution and monitoring of an investment strategy off the plate of the credit union and places it on the same portfolio managers who invest for CUNA Mutual Group's nearly $10 billion general account," said Ed Meier, director, Fixed Income Investments, MEMBERS Capital Advisors.
The Credit Union National Association (CUNA) estimates that 650,000 consumers nationwide have joined credit unions since Sept. 29--the day Bank of America announced its now-rescinded $5 monthly debit card fee. That estimate is based on a response to a CUNA nationwide survey of 5,000 credit unions. Credit unions have added $4.5 billion in saving accounts--likely attributable to new members and existing members shifting their funds from other financial institutions--since that date, CUNA said.
The company has more than 25 broker relationships to assure a selection of securities, Meier said. CUIAS also adheres to regulatory-compliant accounting and reporting practices. "We provide a monthly report that prices and 'shock-tests' all positions in the portfolio--quality, duration and mix," he said. "This can be given to regulators when they arrive if needed."
Meier noted the credit union's management can remain in control of the process by reviewing, analyzing and approving transactions as the portfolios are advised by MCA on a non-discretionary basis.
CUIAS is best-suited for credit unions with more than $20 million in investable assets, with the minimum investment being $10 million, he said. It focuses on longer-term investments of one year or longer in duration.
To strengthen the program, CUNA Mutual Group has hired Jeff Weber, an industry veteran, to help establish CUIAS. Before taking on the role of investment sales specialist for MEMBERS Capital Advisors, Weber served as managing director of equity trading for Allianz of America, where he was responsible for managing a Standard and Poor's 500 Index Fund with more than $600 million in assets.