Credit Union Service Organization (CUSO) Formation and Growth
By: Michael Mulvey firstname.lastname@example.org One of the benefits of forming a CUSO is the limited liability protection offered to a CUSO’s investor(s). In order to maintain this protection, the CUSO and investing credit union(s) must maintain corporate separateness. This means the two entities’ operations are separate and distinct from each other. The reason this […]
This is an introductory webinar to credit union service organizations (CUSO). The webinar discusses regulatory requirements governing the formation of CUSOs, business considerations you should consider prior to creating a CUSO, and the documents you will need to form a CUSO. If you have any questions about the webinar or the CUSO formation process itself, […]
Leveraging the Profits Made by CUSOs The primary advantage to using a holding company CUSO is a consolidation of CUSO investments and leveraging the profitable CUSOs to make additional CUSO investments. A federally chartered credit union may only invest up to 1% of its assets in CUSOs in the aggregate. However, NCUA defines CUSO investment […]
As you know, part of forming a credit union service organization (“CUSO”) involves registering the company on the National Credit Union Administration’s (“NCUA”) CUSO Registry. Within sixty (60) days of the first credit union making an investment in the CUSO, the CUSO must register with the NCUA. The web-based registration process takes approximately fifteen minutes […]
Messick Lauer & Smith PC continues its semi-regular Webinar series. This Client Corner features LenderClose. Learn more about how LenderClose is helping credit unions to provide superior member service. Here is the link to this video: https://vimeo.com/436912700 For more information regarding LenderClose and their services, please visit their website www.lenderclose.com
Due to the COVID-19 pandemic, many credit unions and CUSOs have been required to adjust. Most employees are working from home or performing their duties in a non-traditional manner. Third party relationships may have been altered or suspended entirely. Given the rapidly changing nature of the workplace and third party relationships, it can seem disorienting. […]
CUSOs are investing in startups and fintech to add innovative services and products in a dynamic financial services industry. The success of these organizations rests on talented individuals who often come from the for-profit world and have different motivators than those in the traditional, non-profit credit union model. In order to maximize the value of […]
The insurance industry presents a unique opportunity for credit unions to grow strategically. Insurance is not only a way to add value for members, but also presents a source of non-interest income. Chances are your members have some type of insurance, whether its healthcare, auto, property, or life and if they’re not getting these services […]
CUSO 101 from Messick & Lauer on Vimeo.
On June 14, Jack Antonini, NACUSO President and Guy Messick, NACUSO General Counsel met with NCUA Staff on the results of the CUSO Registry and the thinking on how CUSO Reviews will be handled. The CUSO Registry sign-up period and the follow-up by NCUA found there were approximately 900 CUSOs. NCUA believes that there are […]
We have been through the pain of implementing the new regulation. We have registered our CUSOs and scratched our heads over the types of information the NCUA requested as part of the CUSO registration process. But now we are able to reap one benefit from the hard work. We can now search the publicly available […]
How are CUSOs helping credit unions and their members? The approaches are changing, as are the needs of members coming out of the recession. Please click here to read more. [Subscription required] Brian Lauer, Partner with Messick and Lauer P.C., is quoted in this article written by Ray Birch which was originally published in the […]
The National Credit Union Administration required all credit union service organizations to register by March 31, and while the process went mostly smoothly, some CUSOs now worry what will happen with the information they have provided the regulator. Please click here to read more. [Subscription required] Brian Lauer, Partner with Messick and Lauer P.C., is […]
As most of you know, all CUSOs are obligated under the NCUA Regulations to register certain information directly with NCUA on an annual basis. Over 800 CUSOs did so in February and March. NCUA is now in the process of making sure all CUSOs have registered. Their new deadline is April 30, 2016. They are […]
I am constantly trying to get the attention of credit unions to persuade them that even successful credit unions need to collaborate and they need to start now. With every Tom, Dick and Harry competing to take away the traditional business lines of financial institutions, credit unions cannot sit back and wait for things to […]
During the process of assisting with CUSO Registry questions, it came to our attention that in order to complete the CUSO Registry, CUSOs were required to agree to be bound by statutes that apply to credit unions which imposed penalties that are not applicable to a CUSO. On behalf of NACUSO and the many CUSOs […]
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. CUs Link for Compliance by Michelle A. Samaad 4/22/2012 http://www.cutimes.com/2012/04/22/cus-link-for-compliance
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. Protect CUSO Operations Against Scrutiny by Michell A. Samaad 3/6/2011 http://www.cutimes.com/2011/03/16/protecting-cuso-operations-against-scrutiny
The following is a link to an article published in the Credit Union Times wherein a member of our firm is quoted. CUSOs Can Falter After Mergers and Conservatorship by Michell A. Samaad 11/24/2011 http://www.cutimes.com/2011/07/24/cuso-can-falter-after-mergers-and-conservatorships
What is a Credit Union Service Organization (CUSO)? The term “CUSO” means that the business entity is qualified for and has a credit union investment. A CUSO must be a Subchapter-C corporation, limited liability company or limited partnership in which a credit union has an investment or loan. A CUSO cannot be a Subchapter-S corporation […]
Plymouth, MN (June 13, 2014)–OnApproach, a leading provider of reporting and analytics solutions to credit unions, announced today that it has entered into an agreement to acquire Technology Navigator. Technology Navigator is a Credit Union Service Organization (CUSO) providing reporting and analytical solutions to analyze risk, assess lending and certificate portfolio makeup, address key performance […]
We lose approximately 250 to 300 credit unions per year to mergers, liquidations, and conversions. Only a handful of credit unions have been formed in the last ten years that survive today. While I understand that credit union assets and members are growing despite the reduction in the number of credit unions, I submit that […]
We often talk about collaboration in the context of business and product development; however, collaboration can also play an important role in regulatory compliance. It is undeniable that the current regulatory climate is complex and can even seem insurmountable at times. It is showing no signs of slowing down and credit unions will have to […]
There are many reasons why a credit union would invest in a CUSO instead of providing the same services directly through the credit union. These reasons may be that the CUSO is a collaboration of several CUSOs to create economies of scale, that it would be too cost prohibitive to initiate the service from the […]
Many have heard that the NCUA is setting its sights on CUSOs because CUSOs are playing a more important and influential role in the credit union industry. You may have read the transcript of Chairman Matzâ€™s testimony before the Senate, or you are experiencing it first hand with a zealous examiner shining his or her […]
“We must all hang together or we will surely hang separately.” Benjamin Franklin uttered these words as he signed the Declaration of Independence and faced the wrath of King George. The colonies were at a crossroads. Despite divergent and competing interests, the colonies recognized that together they had a chance for survival and alone they […]
The vast majority of people who work at NCUA and the state credit union regulatory agencies fully appreciate that credit unions need economies of scale and more expertise in order to survive and thrive in today’s regulatory climate. Combining operational services can be very effective. Many credit unions have collaborated in such services as business […]
This is a 5:38 minute presentation on the basic rules of CUSO organization for those who are new to CUSOs. CUSO Basics from Messick & Lauer on Vimeo.
This is a 6:45 minute presentation on why credit unions should consider collaboration and CUSOs as part of their business model. Why Collaborate from Messick & Lauer on Vimeo.
This is a 5:19 minute presentation on the considerations in organizing and operating a CUSO owned by multiple credit unions. Multi-Owned CUSOs from Messick & Lauer on Vimeo.
This is a 5:32 minute presentation on the considerations in protecting the CUSO’s corporate veil so that an error in the CUSO does not adversely affect the credit union owners. Protection of the CUSO Corporate Veil from Messick & Lauer on Vimeo.
This is a 5:06 minute presentation on how credit unions can begin the process of collaboration and using CUSOs.
This is a 5:29 minute presentation on how CUSOs can help generate more net income for credit unions through additional revenue sources and reduction of operational costs. Generating Net Income from Messick & Lauer on Vimeo.
This is a 6:36 minute presentation on the process of adding new owners for your CUSO to meet your objectives. Expanding CUSO Ownership from Messick & Lauer on Vimeo.
The title character in the Pogo comic strip once uttered the now famous line, “We have met the enemy and it is us.” He could have been talking about credit unions. There are many external threats to the industry (e.g., threat of taxation, diminishing margin spreads, excessive regulation) but the real threat is our inability […]
Sometimes things are so clear that they are almost self-evident. For credit unions it is clear that the credit union business model is transforming in front of our eyes. For most of the 20th Century consumer financial services were offered on a local scale by community banks and credit unions. There was a simple set […]
There is a lot of interest in cooperative CUSOs these days, CUSOs that are owned by multiple credit unions. Most of these CUSOs provide operational services which can significantly reduce operating costs while increasing operational efficiencies. Some cooperative CUSOs provide non-traditional financial services which drive alternative revenue streams and offer valuable services to members. The […]
We are at a critical juncture in the history of credit unions. Negative events seem to be piling up on us. There is enough denial, over-reaction, semi-panic, and name calling to fill our days. It is time for all of us to take a deep breath, reflect and consider where our behavior is leading credit […]
Collaborations, through CUSOs and otherwise, hold the promise of earning non-interest income from non-traditional financial products and of significantly reducing operating costs. Both opportunities are welcomed in an industry where the average net interest income is less than the costs of running a credit union. If collaborations are not extensively used by credit unions, the […]