NewSolutions: A Core That Zings
Bay Ridge FCU races through participation lending with NewSolutions.
Share One Inc. serves up technology that lets our credit union clients hit the road faster at the end of the day.
NewSolutions, the core processing system developed by Share One, offers a powerful hemi-like engine, utilizing SQL-Windows technology, which efficiently organizes credit union data and speeds workflow processes.
But the collaborative partnership delivered to our clients is the real punch that gives Share One the ability to pull ahead of the pack of core system providers. A great example of this collaborative process was developed for Bay Ridge Federal Credit Union, a Share One client since 2004. They needed a technology enhancement that would allow them to streamline an important portion of their lending portfolio.
Located in Brooklyn, N.Y., Bay Ridge Federal has been serving its members for over 75 years. According to Gene Brody, president/CEO of the $130 million asset credit union, Bay Ridge currently hefts a 95% loan-to-share ratio. He credits around 50% of his loan portfolio to member business lending, authorized on a waiver of the National Credit Union Administration’s (NCUA) member business lending limit, and much of that is made up of participation loans.
Part of Bay Ridge’s field of membership includes New York City taxi owners that need taxi medallion loans (each taxi cab in NYC must have a license, which is called a medallion, in order to legally operate). These medallions are transferable, and when sold they range in value from $500,000 to $750,000. They are sometimes sold in pairs at up to $1.5 million.
In order to serve its members that need these larger loans—loans that may exceed Bay Ridge’s NCUA cap of 15% of capital to one borrower or group of associated borrowers—Bay Ridge began selling participations in these loans.
“We are especially pleased in the current economic environment, which allows our participation partners to be able to earn 5.25% on these low-risk loans, compared to about 1% on similar three-year term investments,” said Brody.
But tracking and administrating the participation loans had begun to wear down the staff. “We wanted an integrated, automatic management and reporting system,” he said.
Through the years, Bay Ridge Federal created a system of spreadsheet and mail merge files that was both elaborate and complicated. The required administrative duties were a speed bump that had to be navigated every month for each multi-faceted, unique loan.
Share One developers and Bay Ridge staff worked together to engineer a NewSolutions enhancement that now rapidly organizes and manages a previously labor-intensive process.
“The NewSolutions participation loan enhancement makes monthly reporting, remittances, and posting a breeze for both the participation purchaser and Bay Ridge Federal,” says Brody.
The NewSolutions participation platform handles large loans, pools of investors, complicated rate calculations, fees, notices, and one-click reporting. The development process began about 18 months ago, and Bay Ridge Federal served to beta test the module.
Since then, Joe Sergio at Southwest Chicago Chapter Credit Union has implemented the platform as well. The system can host a variety of loans, including commercial real estate, mortgages, and retail loans with variable or fixed rates. It’s seamlessly integrated within the core platform.
It utilizes the time-saving functionality that NewSolutions users depend on to view and manage the total member relationship. “We are proud to be able to offer working solutions for our clients so they can utilize our technological expertise to optimize the power of NewSolutions,” says Don Conrad, Share One’s senior vice president. “NewSolutions provides a user-friendly experience and the participation module is proof our system and our staff deliver great value.”
Share One Inc., a CUSO with a client base of 84 credit unions with assets ranging from $10 million to over $1 billion, is a leading developer of credit union software solutions. NewSolutions provides a full range of advanced features, including comprehensive support for consumer, mortgage, and commercial loans; a full suite of electronic services delivered via the Internet; a fully integrated, member-centric imaging system; and exceptional operational efficiency.
For more information call 800-888-0766 or visit the company Web site at www.shareone.com.