A Note From Chis
Once again, the summer months have flown by! I hope you all found time to relax, unwind, and enjoy some fun activities with your loved ones. Now, summer is winding down, the kids are going back to school, and we are beginning to prepare our budgets and schedule our planning sessions. To assist you with your planning efforts, we invite you to attend our annual Economic Outlook Conference on Thursday, October 12. This event promises to equip credit union professionals with vital insights into the present and upcoming economic landscape, delivered by a diverse range of speakers. For additional details about the speakers, sessions, and registration, please refer to our website.
Many “Hike the Hill” events in Washington D.C. are also coming up soon. These are a testament to the strength and passion of the movement when so many credit union leaders head to D.C. to connect with legislators and advocate on behalf of all our credit union members at the national level. If you haven’t had the opportunity to participate in a Hike the Hill event before, I strongly urge you to consider attending. Your voice matters!
Sincerely,
Chris Felton
President/CEO
Did You Know?
The CU-Save program continues to deliver big time savings to credit unions.
Since the launch of the program in 2017, InterLutions has helped 80 credit unions save over $30 million. The solution is called CU-Save and partners with the industry-leading advisory firm SRM to review third-party vendor contracts to realign pricing, increase incentives and income, and remove restrictive service requirements leading to a much improved and mutually beneficial agreement.
The powerful combination of inside experience and proprietary benchmarking delivered savings in the six-figure range for several participating credit unions, with most being able to retain their preferred service partners with zero impact to service levels and no operational disruption. Utilizing an archive of invoice data and payments analytics, along with a software database of industry benchmarks, the CU-Save contract negotiation team leverages the power of data to help credit unions significantly lower their operational expenses.
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Technology Solutions
Free download: How to future-proof your credit union’s IT.
The team at Think|Stack has been hard at work helping credit unions craft their IT budgets and strategic plans for 2024 and beyond. They have created A Field Guide: How to Future-Proof Your Credit Union’s IT to help you map important next steps to improve your IT.
Visit ThinkStack.Co to get your free copy.
This guide will give you valuable, actionable information, including:
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How to create a tech map to guide your IT planning
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Insights on embracing the cloud (at your own speed)
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Cybersecurity tips: how to implement zero trust
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Data security: why you should consider a virtual chief information security officer
Next month marks the beginning of Q4, and most credit unions have already started their strategic planning for 2024. At Think|Stack, in addition to our managed IT services offerings, we help credit unions with strategic IT planning, budget preparation, cloud readiness assessments, cybersecurity assessments, board education workshops, and more.
If you are looking for some help with anything related to IT, cybersecurity, cloud adoption, or just to get a second opinion on an IT decision – please don’t hesitate to contact Think|Stack.
Employee Benefit Resources
27 small credit unions choose I-Care for their employee health plans.
InterLutions recently welcomed 27 credit unions to its “I-Care Family.” The innovative health plan solution, called I-Care, leverages data, technology, and collaboration to deliver competitive benefits to credit unions of any size or location. The CUSO recently launched an in-house insurance agency to work exclusively with smaller credit unions, and it is now the CUSO’s fastest growing product. A unique advantage of the health plan is achieved through enhanced underwriting strategies that have proven to deliver more competitive premiums to credit union employees. The CUSO highlights its medical claims reports that demonstrate how credit unions are generally a healthier population than other industries, and thus deserve lower premiums. According to the CUSO, the 27 credit unions that recently joined I-Care range from an employee size of 1 to 88 and are located across 15 different states.
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Financial Services Consulting
Investments 101 educational webinar series.
QuantyPhi’s “Investments 101” webinar education series continues September 21 with a look at total return analysis. Total return is a cornerstone of the portfolio optimization process. It facilitates the synchronization of the investment portfolio to the credit union’s balance sheet while bringing in risk measurements along with income. This month’s webinar is ideal for anyone interested in portfolio management to get an introduction to an important concept.
Register Today
The Investment 101 series is intended to provide an overview of a variety of investment vehicles and portfolio management strategies. The series has covered agency pass through mortgage pools, CMOs, agency commercial mortgage-backed securities, laddered portfolio structures, and asset liability management. If you missed any of these or would like to get access to a replay of any of the webinars, let us know and we will provide a link.
Optimizing funding structure and liquidity strategies.
Treasuries added about 5-basis points in the short end of the curve in August, 10 to 15 basis points in the belly of the curve, and 20-basis points in the long end. The flatter curve suggests the market adjusted to the possibility of a “higher for longer” rate path from the Fed. The Fed funds future market is implying little chance of a Fed move this month and about a 40% probability of a 25-basis point rate hike at the following Fed meeting in November. It continues to price in an aggressive Fed pivot at the end of the first quarter in 2024. Fed fund futures for January 2025 settlement implies a Fed funds rate of 4.125%, approximately 125-basis points below current levels. That suggests the Fed will be comfortable enough with inflation to execute 5 to 6 25-basis point rate cuts in a 7-month stretch. The forward US Treasury curve is also pointing to lower rates ahead. Looking 1- months forward, it implies that we will see rates fall about 75-basis points in the two-year maturity, 30-basis points in the 5-year, and 10-basis points in the 10-year.
It's always important to note that history tells us that Fed fund futures and the forward yield curve projected rate paths cannot be relied upon. Their accuracy rate is about as good as a coin flip. Both do provide important insight into market sentiment and pricing, allowing portfolio managers to make better strategic decisions. Also important to note is that those decisions can involve either side of the balance sheet. While our commentaries are typically aimed at the investment side, our analytics can be used to help make solid decisions for the funding side as well. With the Fed executing a historic liquidity drain, most of our conversations with members this year have revolved around optimizing funding structure and liquidity strategies. Don’t hesitate to contact us for help with any aspect of your balance sheet. We are your corporate and we are here to help.
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What’s Trending?
3 reasons why your credit union should audit its vendors.
Vendor relationships can be an amazing benefit for your credit union; they can help improve member experience, be a pillar of your internal infrastructure or aid in the development of new offerings or solutions. In the absence of a crystal ball, vendors also pile up as you cobble together a set of solutions that you hope will be the right fit for your institution for an extended period. Over time, your credit union may find itself with more vendors than needed. As contracts come up for renewal, take a moment to consider each vendor and determine if they’re still providing a needed service to your credit union.
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Credit Unions Connect
Stories that exemplify the movement
Supporting youth sports.
Forest Area Federal Credit Union proudly presented Mesick Consolidated Schools with a $2,500 grant. These funds will be used to help purchase a new indoor scoreboard for their Mesick High School Bulldogs.
Spreading smiles.
Team members from Soo Co-op Credit Union spent an afternoon volunteering at the Chippewa County Fair. They hosted a Senior Appreciation Luncheon and had a blast serving up delicious food and spreading smiles.
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What’s New and Who’s Who
Corporate Central welcomes Senior Software Engineer, Ken Pardon.
We are excited to welcome Ken Pardon to our growing team as a Senior Software Engineer. Ken delivers business process improvements and automations that provide a positive return on investment for the organization. He designs, develops, and integrates efficient business intelligence and database systems, appropriate for the business environment. He also designs and maintains front-end user interfaces, identifies users’ complex problems, and recommends appropriate resolutions, while understanding client needs and translating requirements into business applications. Ken graduated from UW-Eau Claire with a bachelor’s degree in Computer Science and a minor in Physics.
He worked for over 30 years in various industries including manufacturing, warehousing, healthcare, and financial services. His areas of work have included software design and development for systems integration, data conversions, web-scraping, installations, data analysis, user interfaces, web development, and reporting. He also worked in systems support troubleshooting and resolving customer software and hardware issues. Technologies have included C, C#, VB.NET, Python, and ASP.NET. Outside of work, Ken enjoys spending time with his wife, Chris, their three daughters, their son, and their families. He enjoys traveling to see new places and enjoys working outside around the house maintaining their property. He is active in trapshooting, competing nationally, and he is a volunteer coach for school youth trapshooting teams. Welcome, Ken!
Read more about Corporate Central’s team.