TNB Card Services Buys Credit Card Programs from Credit Unions in Minnesota, Missouri, Texas

DALLAS ? TNB Card Services has purchased the credit card portfolios of four credit unions in three states, and will operate those card programs through its agent issuer organization. TNB has bought more than 65 portfolios since it began agent card issuing in late 2002.

Selling their portfolios were Great Plains Federal Credit Union of Joplin, Missouri; SourceOne Federal Credit Union in Brooklyn Center, Minnesota; Hereford Texas Federal Credit Union in Hereford, Texas; and Thiokol Ordnance Federal Credit Union of Marshall, Texas. TNB Card Services is currently completing its conversion of the four portfolios.

“The reasons these four credit unions chose to sell their portfolios reflect the usual concerns of so many credit unions,” observed Glen Lee, first senior vice president of TNB Card Services. “They were driven by competition from larger issuers, the desire to put more competitive card products in their members’ hands, and the staffing challenges involved in managing a program. TNB is now in a position to address all these issues on their behalf, and work with them as a trusted partner.”

Great Plains Federal Credit Union of Joplin, Missouri, began 55 years ago as Gulf Employees Federal Credit Union. It now serves a number of special employee groups as well as a community-chartered area of central Kansas. With 34,000 members and $220 million in assets, Great Plains has ten branches in addition to its headquarters office.

“The main driver for us selling our portfolio was competition,” said Kenneth Martin, president and CEO. “Our members get so many promotional offers for other credit cards, and we had a hard time offering those kinds of inducements to keep our cardholders.”

Martin said he was impressed with the “dynamic” program of TNB. It gives Great Plains cardholders a wide range of options, he noted, adding, “This puts a good product in our members’ hands that we feel comfortable with and we can promote.”

SourceOne Federal Credit Union, based in Brooklyn Center, Minnesota, has been around since 1933, and serves Minneapolis and nine communities to the northwest of the city. With 4,800 members and $44.5 million in assets, the credit union has a branch in downtown Minneapolis in addition to its suburban headquarters.

SourceOne decided to sell its card program so that its members would have a wider selection of products, explained Terri Maloney, president and CEO. As a smaller credit union, SourceOne couldn’t afford the investment in a more robust program.

“The fact that TNB is owned and directed by credit unions was important to us,” said Maloney. “I checked with other credit unions that have sold their portfolios to TNB, and heard only positive things. That made our decision easy.”

Hereford Texas Federal Credit Union, founded in 1936, is a community-chartered organization serving residents of Castro and Deaf Smith counties in northwest Texas. The credit union has 10,000 members and assets of $40 million.

Bob Baker, manager and CEO of the credit union, says it was difficult to maintain the staff skills necessary to manage the portfolio properly. Hereford Texas FCU had been a TNB processing client, and when the decision was made to sell, the only option considered was selling the portfolio to TNB.

“I was a happy customer and I trust them,” Baker said. He also checked with a couple of credit unions who had previously sold their card portfolios to TNB, and got good reports. “We’re looking for this sale to give our members a much better card in their pocket from now on, and lower, more competitive rates,” he added.

Thiokol Ordnance Federal Credit Union of Marshall, Texas, has been around since 1955, serving employees of the Thiokol Company. The credit union has about 800 members and assets of $7 million.

Joy Jones, manager, said Thiokol Ordnance chose to sell its portfolio because it wasn’t a profitable part of the credit union’s business. Like Hereford Texas Federal Credit Union, Thiokol Ordnance talked only with TNB about a sale. TNB had already been doing the card processing for Thiokol Ordnance.

“We approached TNB because we knew them and liked working with them,” Jones noted. “By selling the portfolio, we will now be able to offer members more competitive rates, higher credit limits, and other programs we couldn?t have offered on our own.”