PR - TNB Buys Card Portfolios from Hawaiian Credit Unions

TNB Card Services has purchased the credit card portfolios of two Hawaiian credit unions and is currently converting those card portfolios to TNB’s agent issuing program. These purchases bring the total number of programs that credit union-owned TNB has purchased to 150 since it launched its agent issuing program in 2002.

TNB now owns the programs of Hawaii Pacific Federal Credit Union and Kaua’i Government Employees’ Federal Credit Union. With these two card programs, TNB added more than $3.2 million in outstanding balances to its agent issuing portfolio.

“For some credit unions, managing a portfolio can be overwhelming,” said Jay Kurian, first senior vice president of TNB Card Services. “Sometimes the best thing a credit union can do to improve a card program is to sell the portfolio. As a trustworthy, loyal partner and a part of the credit union movement for over 30 years, TNB understands credit unions and delivers the best electronic payment products and services to members. As a result, this strengthens their relationships with their credit union.”

Hawaii Pacific Federal Credit Union, based in Honolulu, had been considering selling its program for a few years, since it was becoming more difficult to compete against national card issuers. Hawaii Pacific had done a good job growing the cardholder base, but marketing costs were increasing, along with fraud risk.

“We were concerned about being able to develop product fast enough to keep up with the competition, and our current processing company couldn’t keep pace with the product enhancements that we needed,” said Mark Yamane, president of Hawaii Pacific Federal Credit Union.

The credit union decided to sell its portfolio to TNB Yamane said, because “TNB has always been owned and directed by credit unions and has a strong record of delivering relevant and competitive card products.”

The 67-year-old Hawaii Pacific Federal Credit Union serves retail employees in various areas of Hawaii, with three branches. It has 8,000 members and assets of $48 million.

For years, Kaua’i Government Employees’ Federal Credit Union explored options for growing its credit card program, but limited resources, low account volumes, and the inability to become top-of-wallet helped convince the credit union to sell its card portfolio.

“In analyzing the portfolio, low member utilization, increasing fraud risk and insurance premiums, and the overall cost of maintaining the portfolio made it an easy decision to partner with a reputable institution such as TNB,” said Ed Medeiros, general manager and CEO. “With TNB, we can offer a value-added credit card for the benefit of our members, without the cost of maintaining the program.”

Kaua’i Government Employees’ Federal Credit Union was established in 1947 to serve government workers on the island and their families. Since then the credit union has added 50 select employer groups, primarily small businesses. The credit union currently has assets of $52 million.