Third Quarter 2007
Service Corp, Members United partner in item processing
As a strategic move to commit more resources into other areas of credit union growth, the ICUL Service Corporation’s (LSC), Service Corp Item Processing (SCIP) function has been consolidated with Members United Corporate Federal Credit Union’s check processing operation.
The transaction to consolidate their respective institution’s check processing operations has been completed, effective August 1, 2007, and all operations will be combined in the fourth quarter. The combined program will be managed and operated by Members United. The ICUL Service Corporation's assets, contracts, and business relationships will be transferred to the corporate credit union.
LSC has been providing share draft (check) item processing services to Illinois credit unions for the past thirty years, and since 1988 has been operating an item processing center on an in-house basis. Under the business identity of SCIP, it serves approximately 175 credit unions in the Seventh Fed District (Chicago), and processes about 4.5 million items per month. Eighth District credit unions (St. Louis) will not be affected by this consolidation.
Dan Plauda, ICUL President/Chief Executive Officer, stated, “The Service Corporation started SCIP from scratch in 1988 and has processed well over a billion share drafts during that period. More importantly, it is estimated that SCIP has saved credit unions more than $10 million in processing fees over that span of time. With the reduction in the numbers of checks written, we believe consolidation is necessary to ensure credit unions continue to enjoy this type of competitive advantage. We will always do what is best for credit unions.”
“Our mission is to help credit unions compete,” said George Feigle, LSC Executive Vice President. “With the item processing business waning, it made sense for us to evaluate our existing products and services, and as a result gain resources that can be invested in growth opportunities for credit unions to better serve their members.”
Members United Corporate Federal Credit Union is an established item processor on the national scene. With multiple locations throughout its geographic footprint, Members United has significant scale, and has a large depth of knowledge and experience in this business. One of the nation’s largest corporate credit unions, it offers the convenience of processing and settlement within the same institution.
“The large scale volume of items that Members United processes allows it to keep costs down, as well as to develop and adapt new technologies. This combination of low cost and technology investment provides the highest possible value to our member credit unions,” said David Preter, President of Members United. “With our expertise in this business, we anticipate a seamless transition for the credit unions currently served by SCIP.”