When Pelican State Credit Union needs liquidity support without complicating operations, it turns to Louisiana Corporate Credit Union (LaCorp) and its SimpliCD issuance offering. Pelican State Controller Kaya Tomlinson says the long-standing partnership plays an important role.
“We have a long-term relationship, more than two decades,” Tomlinson said. “We like keeping money local and maintaining that local relationship.” Specifically, she explained that Pelican State, a Community Development Financial Institution-certified credit union, keeps its grant funding at LaCorp because they make it easy to keep their grant funds separate from their operating accounts.
LaCorp Operations VP Erin Byrd added that most grant programs require segregation of funds, and LaCorp can easily accommodate that with no reduction in rates.
Tomlinson noted that the balance of convenience and community is key to the relationship. When the $725 million Pelican State is looking to place funds, the process with LaCorp is fast and straightforward through its partnership with SimpliCD.
“Basically, I ask my SimpliCD representative, ‘Hey, we’re trying to get this much. We’re looking at offering this. What do you think my chances are?’” Tomlinson explained. “She’ll either say, ‘No, I’ve got more at a higher rate,’ or ‘You could even go lower.’ That’s really helpful.”
Pelican State can place large sums of funds into CDs all in one fell swoop rather than individual CDs that other vendors require. “You put in a large sum of money and only have to open one CD,” she said. "Other vendors we’ve tried, you’ve got to open individual CDs, so you end up opening 10 CDs, that’s 10 wires to deal with, 10 wires to post, 10 CDs to open. This process is just not as much work.”
Tomlinson recently opened a one-year and an 18-month CD. “I was provided a list of everyone who invested, and it was two pages long. I’m glad I didn’t have to open two pages of accounts!” she said. “Less work and less to maintain.”
The ease continues through to maturity. “They just want checks for their dividends. They send out a monthly check, and then come wiring day when it matures, they send a sheet with instructions. You wire it out, and that’s it. Everything’s done through email—it’s really easy.”
In just the last month, Pelican State placed $18 million with SimpliCD through LaCorp at a rate that remains lower than what the credit union offers its members, a key factor in managing the cost of funds. “It’s about trying to get money into our credit union at a lesser cost than we’d pay our members so we can keep serving our members,” Tomlinson concluded.
LaCorp CEO David Savoie emphasized the importance of making liquidity simple and efficient for his member credit unions. “We know our members are juggling a lot—compliance, operations, serving their communities—so our goal is to take one thing off their plate and help them improve profitability while we’re at it. I'm glad we can make it easier for Kaya and Pelican State Credit Union to get the funds they need, when they need them, without all the red tape.”