Members 1st FCU Turns to LoanStreet for Participations Data Analytics



Originally published in the January 2019 issue of Credit Union Business. Link to the online article here.


Executives at Members 1st Federal Credit Union, a $4.1 billion lender based in Mechanicsburg, PA, had been searching for a way to ramp up its loan participation program without encountering the record-keeping headaches and sharp rise in headcount traditionally needed to track the performance of hundreds of transactions.

“We needed a technology solution to scale our program so that we could partner with the best buyer or buyers at any time without increasing our administrative burdens,” Jessica Whitmyer, Members 1st FCU’s vice president of finance and controller, said. “LoanStreet’s technology was the ideal solution.” LoanStreet’s new, fully-integrated online loan participation platform was all the credit union needed for an automated and scalable solution in one place.

Members 1st is now poised for growth. LoanStreet’s automated reporting tools provide Members 1st with a consolidated view of every transaction in their portfolio, no matter how many different parties with which it does business, Whitmyer explained. She added, the technology improved accuracy of reporting, reduced administrative overhead and significantly expedited reporting turnaround times. For most credit unions, the manual reporting and compliance documentation most credit unions do can take two weeks or longer. Through its new-found automation, Members 1st can generate and deliver reports for executives, auditors, and regulators in a single day.

In addition, the streamlined reporting process positions Members 1st to scale its loan participation program. LoanStreet’s automated tools simplify tracking of thousands of transactions across hundreds of partners as it does to manage the reporting of a single loan. “For credit unions like Members 1st, these reporting tools give them the flexibility to partner with any credit union as they grow their participation program,” Ian Lampl, LoanStreet co-founder and chief executive, said. “By delivering a single, consolidated report with no administrative overhead, LoanStreet unlocks the ability for credit unions to enter into loan participations with hundreds of potential counterparties rather than just a handful. That ultimately means more opportunities, better pricing, and better financial results.”

Harnessing the power of scalable technology and automation is critical in the modern financial services marketplace. “Traditionally, many credit unions have relied on legacy technology systems that require a significant amount of manual intervention. It took more time to do fewer transactions with less accuracy,” Lampl noted. “Perhaps most troubling, it took away the most critical resource of any credit union: the time their employees spend serving their members.”

LoanStreet, founded in 2013, is a technology platform that streamlines the process of sharing, managing, and originating loans resulting in significant cost-savings and efficiency gains for credit unions. Its smart algorithms ensure that every penny of servicing income is counted, LoanStreet has sometimes even uncovered tens of thousands of dollars in lost revenue.

Whitmyer said Members 1st and LoanStreet connected through its partnership with Vizo Financial Corporate Credit Union after Members 1st began looking for a participation solution. “Members 1st was looking for a seamless solution to assist us in selling loan participations to better strengthen our well-rounded portfolio,” she said. “Due to our quick monthly close process, as well as the time and effort it would have taken to manually account for these participations through cumbersome processes, we were in need of a solution that would not burden our existing staff while ensuring accurate recording and reporting for all parties involved. Through the research we performed, it was clear that LoanStreet was a great partner to ensure a win-win for everyone.”

Members 1st expects LoanStreet’s solution will save time and resources so that its employees can focus on growth, according to Whitmyer. “LoanStreet’s turnaround time is very reasonable and ensures that we have enough time to review the output prior to providing to participant partners,” she explained. “This ensures that we are able to close our books on time, as well as provide reporting to our partners within the required timeframe. Minimal time is spent by our staff managing this process, so we can focus on growing our thriving organization.”

Lampl agreed, “Ultimately, these new technology enabled services free up credit union employees’ time, so instead of focusing on paperwork, they can focus on serving their members even more effectively.”

Tools and technology will only take a credit union so far; they must be backed by solid service from the business partner. “The LoanStreet onboarding and monthly report process has been completely seamless from the beginning,” Whitmyer said. “They were more than accommodating in our testing process at the forefront, as well as when we went live.”

Additionally, LoanStreet was very receptive to feedback on how to continue to evolve the product and ensure that Members 1st was provided with all of the information it requires. “That has been very helpful,” Whitmyer added.

Members 1st even learned a thing or two. “LoanStreet’s process was so seamless, they actually helped to improve our process and made us aware of time-saving measures that we hadn’t previously considered, ensuring the best possible output so we can focus on what we do best – lend!” Whitmyer exclaimed. “In addition, LoanStreet assisted in discussions between all partners involved to ensure a smooth process.”

“We are very excited to have Members 1st join our credit union network,” Lampl said. “Members 1st is a large, sophisticated financial organization that understands the strategic value of harnessing technology to grow their business and manage their balance sheet. We look forward to working with Members 1st and Vizo Financial to meet their participation needs and more.”


About the Author:

Sarah Snell Cooke is principal at Cooke Consulting Solutions, a communications and business development firm serving business partners in the community financial institutions market. She has 20 years of experience in the credit union community, more recently as publisher and editor-inchief of Credit Union Times. She was named to the 2015 Folio Top Women in Media and ALM Media’s 2015 Manager of the Year. Cooke also serves as secretary of the board at $465M APL FCU and is currently volunteering to coach 13-year old boys basketball. Cooke holds an MBA and a Bachelor of Arts in political science with a minor in journalism.