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MFCU is 1 of 7 Credit Unions forming a Credit Union Trust!
Authored By: Rachel Finney on 7/31/2018

MFCU Happenings! 

MFCU IS 1 OF 7 CREDIT UNIONS FORMING A CREDIT UNION TRUST!

A group of 7 prominent Michigan credit unions, including Members First Credit Union, have formally applied with the Michigan Department of Insurance and Financial Services to establish a new limited purpose financial institution that will provide trust services primarily to credit union members. Formal acceptance of the application kicks off a review process by state regulators that can last 100 days, at which time the organizers anticipate approval. Now with approval, Credit Union Trust will become the first such entity in Michigan organized by credit unions established to primarily serve the needs of credit union members. Our goal in forming this new organization is to be able to provide trust services to our members and all credit union members across Michigan. It is very exciting for us to be owners of Credit Union Trust - we will be making history in our state!

While credit unions routinely provide a range of wealth management services for their members, we are unable to directly provide fiduciary services such as trusts. Credit Union Trust will allow them to do so. It will offer investment, trust and related services primarily to members of the shareholder credit unions, as well as members of other Michigan credit unions. Though technically a bank (it will not make loans or accept deposits), it is also a credit union service organization that will be equally owned by the founding shareholders.

The credit unions making the application are: Alpena Alcona Area Credit Union, headquartered in Alpena with seven locations; Community Choice Credit Union, headquartered in Farmington Hills with 20 locations; ELGA Credit Union, headquartered in Burton with 11 locations; Frankenmuth Credit Union, headquartered in Frankenmuth with 23 locations; Honor Credit Union, headquartered in Berrien Springs with 24 locations; Members First Credit Union, headquartered in Midland with 11 locations; and Team One Credit Union, headquartered in Saginaw with 12 locations. 

Check out this article for more information!

 

 

UPDATE 11/5/18                     

CREDIT UNION TRUST RECEIVES APPROVAL FROM STATE OF MICHIGAN

Credit Unions Collaborate to Offer Trust Services to Members

Organizers of Credit Union Trust announced today they have received approval from the Michigan Department of Insurance and Financial Services, Office of Banking to proceed with plans to establish the new, limited purpose financial institution.

“We’re pleased and very excited to be moving forward,” said Robert Sajdak, prospective Credit Union Trust President and CEO as named in the application.   “As we said back in July when we announced our application, now that Credit Union Trust is formally approved, once it is organized the real work begins and we will soon begin hiring professionals, implementing plans and contracting for systems and services.”

"We're excited about the approval and look forward to putting in the work to open Credit Union Trust for our members in 2019," said Carrie Iafrate, Executive Vice President for Members First Credit Union.

Credit Union Trust plans to open in late Q1 2019 and will be headquartered in leased facilities located at 31155 Northwestern Highway, Farmington Hills, Michigan.

Organized by a group of seven prominent, Michigan-based credit unions, Credit Union Trust will be both a Michigan limited purpose bank and a credit union service organization (CUSO).  It is the first such entity in the state and is being established to serve the needs of Michigan credit union members.  While credit unions routinely provide a range of wealth management services for their members, they were unable to directly provide fiduciary services such as trusts, until a 2016 change in Michigan law.  That change marked the start of organizers’ planning.

“We know our members, the market, and the industry. We will begin immediately implementing a tightly-focused business plan to serve the needs of our founding credit union members, and all Michigan credit union members who previously had to go outside the familiar credit union family for trust services,” Sajdak said.  “This is a service whose time has come and it’s one our members need.”

This is an important step for Michigan’s approximately 5.23 million credit union members and the industry as a whole.  Baby boomers are expected to transfer $30 trillion in assets to their heirs over the next few decades and a trust provides them a way to avoid the time and expense of probate court, as well as a way to minimize estate taxes.

 “At a time when many traditional banks and trust companies are raising minimum requirements to more than $1 million dollars, Credit Union Trust is focused on serving all members and will administer a much fuller spectrum of trust accounts and balances,” Sajdak explained. 

The organizers are executives of the seven, member-owned credit unions and include: Alpena Alcona Area Credit Union, headquartered in Alpena with seven locations; Community Choice Credit Union, headquartered in Farmington Hills with 20 locations; ELGA Credit Union, headquartered in Burton with 11 locations; Frankenmuth Credit Union, headquartered in Frankenmuth with 23 locations; Honor Credit Union, headquartered in Berrien Springs with 24 locations; Members First Credit Union, headquartered in Midland with 11 locations; and Team One Credit Union, headquartered in Saginaw with 12 locations. 

Credit Union Trust will be regulated by the State of Michigan’s Department of Insurance and Financial Services, Office of Banking.

 

 

UPDATE 12/11/18

CREDIT UNION TRUST: MEMBER BENEFITS

A short time ago, we announced Members First Credit Union had joined with 6 other Michigan-based credit unions to form a trust credit union service organization and limited-purpose bank in order to provide trust services to our members.  We promised to keep our members informed of progress and to provide helpful information as we proceed. We recently responded to a blog query that might also be of interest to members here:

Q – How is this new organization specifically going to benefit me?  I have a couple of brokerage accounts, a trust prepared by a competent attorney, etc. 

A -- Credit Union Trust is being organized to provide trust and investment services to credit union members. Up until now the credit unions have been unable to offer fiduciary services to members.

Many people do want a professional fiduciary to act as their personal representative, trustee, or conservator. Often this is because there is no one else who can meet the requirements of impartiality and professionalism. Individuals move, die, become incapacitated and are often unskilled in administration and taxes – or are simply unable to communicate effectively.  Credit Union Trust will provide such services and have a fee-based investment program that meets the high standards required for a trustee.

To answer your question specifically: every estate plan is different, every members’ objectives and timing are different – so Credit Union Trust starts where the member is.  To understand that, our service starts with an informational meeting, which is a conversation to help us learn the parameters and objectives that will best secure our member’s objectives. 

As an organizer and owner of Credit Union Trust bank, Members we are happy and excited to be able to offer the comprehensive financial management services Credit Union Trust will allow us to provide.  We invite you to keep abreast of developments via our website as Credit Union Trust proceeds toward its planned opening early next year.

For more information, or to arrange an introduction with Credit Union Trust staff, give us a call at: 855.835.MFCU (6328).

 

 

UPDATE 5/21/19

CREDIT UNION TRUST RECEIVES STATE APPROVAL TO COMMENCE BUSINESS

Becomes Michigan's First Fiduciary Service Provider Organized by Credit Unions

Credit Union Trust announced that it has received approval from the state of Michigan to commence business, marking an historic event for Michigan credit unions and their 5.23 million members. 

Credit Union Trust is the first special purpose bank in Michigan organized by seven credit unions to primarily serve the needs of credit union members. Michigan credit union members are now able to access trust and investment related services from the same credit union family.

“This is an important step for Michigan credit unions and their members,” said Robert Sajdak, President & CEO, Credit Union Trust.  “It’s the culmination of two year’s effort and we’re proud of what we’ve been able to accomplish for all Michigan credit union members.”

Previously, credit union members and their families had to get professional trustee and fiduciary services from unaffiliated banks.  With the establishment of Credit Union Trust, that’s changed. 

Credit Union Trust Expands Credit Union Services

Credit Union Trust is a special purpose bank and credit union service organization (CUSO).   Its purpose is to provide trust, fiduciary and investment services and is structured to serve credit union members and the general public.   

“We’re here to serve credit unions and their members in Michigan and we’re doing it by providing value, service and access at a price members can be comfortable with,” said John Landis Vice President and Senior Trust Specialist, Credit Union Trust.

Credit Union Trust seeks to grow beyond the seven organizing credit union and is structured to help all credit unions expand into the fiduciary, trustee and related services they want to offer their members.  In addition to serving individual, Credit Union Trust also provides solutions for foundations, not-for-profit organizations and other community-based entities. 

“Credit unions can now better serve their individual members and institutions, with no added credit union expense to doing so,” Landis added.

Credit Union Trust Benefits Members

There’s a growing need for trust and fiduciary services in general, particularly for trusts that do not meet the minimums of the larger banks. Baby boomers are receiving inheritances from their parents and need a way to pass on that wealth to their next generation.  At the same time, many families face problems with adult children, uncomfortable issues with second families, and the need to care for aging parents.  All these and more are affecting families today and are complications that members may now address through Credit Union Trust.

About Credit Union Trust

Credit Union Trust is Michigan’s first, credit union-organized and owned fiduciary service provider, and is also a credit union service organization (CUSO.)  Credit Union Trust was established by seven Michigan credit unions with more than 500 years of combined industry experience.  Credit Union Trust serves the needs of Michigan credit unions and their members through a state-wide network of credit union branches and is headquartered at 31155 Northwestern Highway, Farmington Hills, Michigan.  For more information go to: www.CreditUnionTrust.com.



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Comments
10/23/2018 8:52 AM David W. from Grayling, MI
How is this new organization specifically going to benefit me? I have a couple of brokerage accounts, a trust prepared by a competent attorney, etc.
Reply From Members First Credit Union:

Credit Union Trust is being organized to provide trust and investment services to credit union members. Up until now the credit unions have been unable to offer fiduciary services to members.

Many people do want a professional fiduciary to act as their personal representative, trustee, or conservator. Often this is because there is no one else who can meet the requirements of impartiality and professionalism. Individuals move, die, become incapacitated and are often unskilled in administration and taxes – or are simply unable to communicate effectively.  Credit Union Trust will provide such services and have a fee-based investment program that meets the high standards required for a trustee.

To answer your question specifically: every estate plan is different, every members’ objectives and timing are different – so Credit Union Trust starts where the member is.  To understand that, our service starts with an informational meeting, which is a conversation to help us learn the parameters and objectives that will best secure our members’ objectives. 

As an organizer and owner of Credit Union Trust bank, Members First Credit Union is happy and excited to be able to offer the comprehensive financial management services Credit Union Trust will allow us to provide.  We invite you to keep abreast of developments via our website as Credit Union Trust proceeds toward its planned opening early next year.

For more information, or to arrange an introduction with Members First or Credit Union Trust staff in Grayling, give us a call at: 855.835.6328.

CLU, ChFC
8/29/2018 3:30 PM Ronald H. from Midland, MI
Aside from going into competition with lawyers and financial planners, this also dilutes the "member ownership" of this new aspect of credit unions. Members would no longer have a say in what this trust company does. In addition, it further blurs the lines between banks and CUs which would then require compliance with additional banking acts and regulations. As it does in Bank & Trust Companies, a trust arm also is a major conflict of interest as a trustee must be free to use which ever investment services he/she determines are prudent. MFCU already offers products for trustees to use at reasonable cost. The remaining services are legal in nature and more suited to a corporate (not member-owned) entity.
Reply From Members First Credit Union:

Ronald,

As community-based institutions, we always want to be able to say “yes” to our members and we always want to retain and maintain our relationship with each person.  Until the law changed 2016, members had no “credit union option” for trust services and had to go outside the credit union family to seek those services from a bank. 

Establishing the Credit Union Trust bank – whose shareholders are member-owned credit unions - allows us to provide a service and some additional opportunities to our members in a way we haven’t been able to do until now.  And remember… we’re credit unions – we’re community-based institutions -- and our focus is always on providing service to our members. 

We look forward to being able to offer our members a convenient, credit union inspired solution for trust and investment needs. Our commitment is to provide the finest trust and related services available at an affordable price while allowing our members to maintain and enjoy the personalized service and relationships they have built over many years.

Thank you,

Members First Credit Union 

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Members First Credit Union | P.O. Box 2165 | Midland, MI 48641
Phone 855-835-MFCU (6328) | mail@mfcu.net

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