PORTLAND , Ore. , September 15, 2004 – AssetExchange has extended a study which found that membership growth and loans per member were stronger for credit unions that sold their portfolios compared to those that kept them. The extended study, based on information filed with the NCUA, examined a number of additional performance measures and found that credit unions that sold their portfolios also out-performed non-sellers in growth of total assets, loan interest income, ROA, net worth, and loan to share ratios. Additionally, charge off rates grew more slowly among selling credit unions.

The goal of this research was to better understand how selling a card portfolio affects credit union performance. After a card portfolio sale, the portfolio buyer usually issues the card with the credit union brand, and often increases card usage by lowering rates, adding features, and increasing marketing. Does this increased marketing and growth in a credit union branded product benefit the selling credit union overall?

The study, conducted by AssetExchange using public-domain NCUA data, analyzed approximately 2,400 credit unions that held credit card portfolios of over $1 million in 2000. Comparing credit unions that sold their card portfolios in 2001 or 2002 to those that did not, the study looked at the change in credit union financial parameters from December 2000 to December 2003. The results indicate that these measures of credit union performance improved more among sellers.

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“Many measures of credit union performance did better for credit unions that have sold their portfolios” said Frank Selker, AssetExchange President. “This may reflect pro-active management among credit unions that sold their portfolios and positive financial impacts of the sale. This does not mean that every credit union should sell, but it shows that many credit unions have done very well after selling their credit card portfolio.”