Football, Fall and Investments: CU's New Division Is a Touchdown

The autumn leaves in Tennessee can only mean one thing: football.With a fall fervor linked to the University of Tennessee, a college with roots dating back to 1794, fans of the Volunteers are as diehard as they come. The loyalty is just as strong at the UT Federal Credit Union, which has served the university community since 1969.However, for years, when members sought out the cooperative for help with investment and insurance needs, they left empty handed. The $170 million credit union just didn’t have the lineup to meet their members’ long-term and retirement needs, said Malinda Wood, vice president of marketing at UTFCU.“We do a really good job with savings and the ins and outs of the credit union, but when the time came for people needing investments, annuities and insurance, we unfortunately had to turn them away,” Wood said.Enter UTFCU Financial Services. The new division made its debut in September after a nine-month search that included a handful of firms, Wood said. By February, the credit union secured a service agreement with LPL Financial Services. Considered to be the nation’s largest independent broker-dealer, LPL Financial Corp. counts more than 230 credit unions among its clientele. In 2008, it had $233.9 billion in assets under management and revenues of $3.1 billion, according to the company. With offices in Boston, Charlotte, N.C., and San Diego, LPL and its affiliates serve 12,294 financial advisers and 780 financial institutions.Having a full suite of investment and insurance services had been on UTFCU’s radar for some time. The Knoxville, Tenn.-based credit union previously had a relationship with a provider, Wood said. Like any relationship, ties are cut for a variety of reasons but with a different leadership at the helm, beefing up the lineup became more of a priority.Members of UTFCU now have access to financial planning strategies along with investment options such as mutual funds, annuities, individual stocks, and life, accident, disability and long-term care insurance. With a stronger array of services, the credit union wanted to ensure that it would hire the right person to oversee the division and, more importantly, connect with members. It took nearly five months to find Derek Dieterich, a certified financial planner with LPL Financial who spent nine years at First Tennessee Bank. His zeal for building relationships was infectious, Wood said. And, it didn’t hurt at all that Dieterich graduated from the University of Tennessee.“He’s knowledgeable. He likes to listen to people, and he’s passionate about what he does,” Wood said. “His experience runs the gamut from investments to insurance. Even with things like budgets–members will say, ‘Here are my bills,’ and he’s helped them.”With an umbilical tie to the University of Tennessee, UTFCU marked its 40-year anniversary this year. Even though the credit union was approved for a community charter in 2007 to serve five counties, nearly 50%, or 11,000, of the cooperative’s 25,000 membership is from the university. UTFCU opened a branch on the school’s campus in November, making it the only financial institution on site. Although UTFCU was originally located on campus in a house on Andy Holt Avenue, the credit union moved several times in the early years and finally outgrew accommodations in the early 1990s.Today, with more than 70 employees, the corporate office and main branch of UTFCU occupies a three-story building just off campus that was completed in 2006. The opening of the University Center branch marks UTFCU’s eighth branchWood said the college’s academic reach extends well beyond Tennessee into other states and other countries, which has helped UTFCU become more global. Many of the credit union’s members who started out with the cooperative in 1969 are still there, she pointed out. Quite a few of them have either retired or are planning to retire soon. For UTFCU, trying to woo members who had investment and retirement products with other entities became a pursuit.“You have a lot of [university] staff members who have a lot of options from the state and the university, and they’re coming to us,” Wood said. “They are coming over to talk to Derek.”What helped was conducting staff training on Columbus Day to educate employees about the new services. Dieterich meets with staff at the credit union’s eight branches on a regular basis to see how he can help. Members are venturing in with questions about saving for new baby expenses or a child going off to college. Some members who have lost their jobs are asking about long-term care and life insurance.To stand out from the myriad of competitors, UTFCU is counting on reinforcing its service mentality of people helping people, Wood said. In addition to Web site, e-mail and statement information, the credit union uses Facebook and Twitter to keep members updated.“This particular part of the country is different. We have a lot of credit unions, and they are pretty big in size. To stand out, we look at our name and our financial education background,” Wood said.Investment services continue to be a small penetration among members nationwide. Wood acknowledged that loans are still UTFCU’s trademark and that’s O.K.“There are some people out there that don’t know credit unions offer checking accounts.” As for investment and insurance, she is optimistic that the new offerings will help UTFCU become a member’s primary financial institutions. “We realize that they won’t need the services until they really need them.”–[email protected]