TNB Card Services Clients Gain More than $5 Million in Post-Holiday Balance Transfer Promotion

DALLAS, TX ? Offering members attractive rates on credit card balance transfers paid off nicely for 42 credit unions that are clients of TNB Card Services. They gained more than $5 million in new credit card balances through a special three-month promotion that launched shortly after the holiday buying season. TNB announced the results today for the promotion, which ran through the end of April.

The participating credit unions capitalized on their members’ desire to find some relief from the higher rates they were paying on competing credit cards. The average transfer per member was an impressive $3,450.

Glen Lee, first senior vice president of TNB Card Services, said the opportune timing for the promotion and the strong marketing that accompanied it were responsible for its success. Although TNB offers a balance transfer promotion two times each year for clients, this was the most successful promotion ever in terms of response and average transfer, Lee added.

“This promotion by our client credit unions once again demonstrates that members truly value the card relationship they have with an organization they trust. The $3,450 average transfer check was phenomenal, and nearly 40 percent higher than the typical average transfer we’ve seen in past promotions,” Lee said.

Compared with the post-holiday balance transfer promotion of a year ago, this year’s response rate, average balance transfer, and aggregate balance transfer were all up significantly.

The total balances transferred in the 2005 promotion amounted to $5.01 million by 1,451 cardholders. The 2.39 percent response rate was based on about 61,000 qualified accounts that were the targets of the offer. Depending on the rate each credit union selected, transfers were offered from 0 percent to 7.9 percent APR ? an offer good through the end of April 2005.

Credit unions began planning the promotion in late 2004, and TNB sent the promotional offer to cardholders at the end of January. The mailing consisted of a letter customized for each credit union, with a detachable check that the member could use for the balance transfer.

The credit union that stood out with the best individual performance was Texas Dow Employees Credit Union of Lake Jackson, Texas. Texas Dow Employees had the best response rate, at 3.92 percent, and the largest average transfer check, at $4,140. The promotion yielded more than $1.8 million in transferred balances.

“The timing of this promotion was excellent for us,” said Steph Sherrodd, vice president of retail delivery for Texas Dow Employees Credit Union. “We completed an overhaul of our credit card program last fall in which we went to risk-based pricing, rolled out a platinum card, and increased credit lines for the first time in our history.

“When we followed that up with a promotion, the results exceeded our expectations. We were excited about the growth we obtained.”

Sherrodd said that the credit union sweetened the offer for members by making the transfer rate permanent for the duration of the balance, rather than offering it for a limited time. She also credited the promotion’s success to “a very loyal membership” that has a strong affinity to Texas Dow Employees Credit Union. The 50-year-old credit union, with some 88,000 members and about $890 million in assets, has a select employee group-based charter.

“Texas Dow Employees Credit Union’s move to risk-based pricing, which helped power their success in this promotion, was the result of their work with TNB’s portfolio advisory services,” Lee noted. “Our clients who have worked with our portfolio advisory team find that members truly do prefer their credit union credit card, and given an attractive product or offering, they will respond very favorably.”