As of September 2005, natural person credit unions had 27.6 percent of their investments at corporate credit unions, the second highest concentration next to federal agencies (43 percent). In fact, 786 credit unions had over 90 percent of their investments at corporates.
It is interesting to note where corporate credit unions are investing the money they receive from the natural person system.
Where they invest their money depends greatly on the asset size of the corporate. As shown by the graphs below, smaller corporates have a greater percentage of their investments at US Central and larger corporates have a much more diversified investment portfolio. Larger corporates keep a greater percentage of their investments in privately issued mortgages and asset backed securities.
Has it always been this way?
YES, investment strategies have always differed among corporates of different size, but the ways in which they differ have changed. The largest change in portfolio holdings can be seen in corporate credit unions over $5B. In 2001, they had a higher percentage invested in foreign and US banks. See below for corporate investment portfolios in 2001.
This data was pulled from Callahan’s Corporate Peer-to-Peer software. This tool is very effective for natural-person credit unions looking to evaluate the health and business strategies of the corporates they do business with. To learn more, click here.