DES MOINES, Iowa – When the Federal Reserve announced it was closing its item processing facility in Omaha, Nebraska, SunCorp suddenly had an item processing dilemma. Where would credit unions in that region send items? SunCorp could have opened its own center, though that would be a costly option, or it could find another partner. Fortunately for SunCorp, The Members Group, based in Des Moines, Iowa, was strategically located to help out – not to mention it has item processing expertise. The Members Group has been doing item processing for Iowa credit unions since 1987, processing some 48.7 million in-clearings last year and 2.8 million proofs of deposit. SunCorp and The Members Group formed an agreement whereby The Members Group will act as a virtual sorter, performing item capture, balancing, return and POD processing. This deal is expected to add 1.6 million in-clearings a month and 400,000 POD items per month to The Members Group's existing volume. "It made more sense to pool our resources and cooperate, rather than compete. They can use some of their excess capacity, and we don't have to invest in a large capital expenditure," said Cyndi Koan, SVP of Operations for SunCorp. The Members Group will transmit a file of images daily to SunCorp for electronic processing. The physical items will get shipped to SunCorp's Denver processing center. "The partnership is a perfect fit for us. SunCorp will provide additional services to their member credit unions, while we are pushing more volume through our equipment," said Clude Urness, senior vice president of product management for The Members Group. Koan said this deal also shows that with electronic transmission of files expected to be increased with Check 21, physical boundaries are going away in the item processing business. "This is a great first step (for Check 21)," she said. If SunCorp had not made this deal, it likely would have had to courier items to another Fed office. Koan said its member credit unions won't notice any changes and SunCorp is still doing the servicing and settlement. WesCorp is also using the virtual sorter concept. It set up a small facility in Utah to start processing for Utah CUs, of which it already has the largest two CUs as clients. These deals prove that corporates may not need to invest in large sorting facilities to move into new markets. SunCorp picked up Nebraska CUs as members from its merger with Nebraska Corporate a few years ago. [email protected]