Multiple-owned CUSOs Becoming Source of CU Innovation, says Callahan report

WASHINGTON – Callahan & Associates released its 2003 Directory of Credit Union Cooperatives, and the report shows that credit union service organizations owned by groups of credit unions instead of traditional wholly-owned CUSOs owned by single credit unions, are becoming a major source of CU innovation and power. One hundred twenty-eight of the 749 CUSOs listed in the directory are multi-owned, and many of them, says Callahan, were formed only in the past 10 years. They vary in function and size; some are incorporated businesses, others are Limited Liability Corporations or partnerships. While 66% of wholly-owned CUSOs focus on providing investment and insurance services, and to a lesser degree mortgage processing, EDP processing, shared branching, and indirect auto lending, the trend for multi-owned CUSOs is on member financial and operational services such as mortgage, business and indirect lending programs, income tax services, shared branch and ATM networks, credit card services. Of the 128 multi-owned CUSOs listed in the directory, nearly 63% deliver these services to credit unions and members. Chip Filson, president of Callahan said “the leading multi-owned CUSOs are driving many of the entrepreneurial initiatives of the credit union system today. These initiatives are developing new sources of revenue that are critical to continued success in a low interest rate environment.” -