LIQUIDITY SERVICES

SunCorp was chartered to be a source of liquidity for our member/owner credit unions. Like your credit union, we exist to be a low-cost source of liquidity for our members. Over the years, SunCorp has become the liquidity provider of choice for credit unions, offering loans of all types and terms, from overnight settlement loans to term loans of several years with fixed or variable rates.

SunCorp maintains vast stores of available credit to meet the borrowing needs of our members. SunCorp stands ready to meet the needs of your institution in times of tight liquidity.

Below is a brief description of some of the liquidity solutions available to your credit union. In order to take advantage of SunCorp's loan products, your credit union will first establish a line of credit. It's very easy, and in most instances, this can be established in one business day. Remember that we can also custom design a credit vehicle to meet your unique needs. Call us at 877.786.2677 or send us an e-mail to find out more.

Credit Union Service Organization (CUSO) Liquidity Services
SunCorp offers liquidity services to CUSO's. Many of the following loan products are available to CUSO's. A CUSO's line of credit is typically guaranteed by the founding member(s) of the organization.

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Loan Types

Settlement/Overdraft Loan
A Settlement/Overdraft Loan consists of overnight liquidity to cover unforeseen charges from item processing and auto settlement files. Through a settlement loan, SunCorp automatically creates a loan for credit unions providing security to members that settlements will be paid in a timely manner without incident. The loan occurs after all daily settlement transactions have been posted to the Cash Management Account. The Settlement/Overdraft Loan is open-ended and has a floating rate.

Demand Loan
Whether your needs are long- or short-term, this loan is created at the "demand" of your credit union. It only takes one call to advance funds for an open-ended period of time. Drawn against an existing line of credit and bearing a lower interest variable-rate than the Settlement/Overdraft Loan, the Demand Loan enables members to decrease borrowing costs and effectively manage their liquidity position. The rate charged on the Demand Loan adjusts daily.

Collateralized Loan
Members holding either eligible marketable securities or SunCorp certificates can reduce their borrowing costs through our Collateralized Loan. Like the Demand Loan, the Collateralized Loan is a floating rate and open-ended. A Collateralized Loan backed by pledged securities or certificates does not count against the member's line of credit

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Term Loan
Term loans are typically made for a specific purpose and an agreed upon term. The rate and term of a Term Loan is determined at the time of the advance with interest payments due monthly and principal due at maturity (unless paid prior to maturity). Term Loans are available for a variety of maturities and are drawn against an existing line of credit. Term Loans are subject to market based, pre-payment penalties if paid off prior to maturity.

Certificate Loan
Your investments at SunCorp give you double the benefits: loan collateral and great rates. Credit unions can use SunCorp certificates as collateral on a loan, and in turn, provide your credit union with a lower cost of funds. This fixed rate loan has a term that doesn't exceed the maturity of the certificate and the rate is set at the time of advance.

Securities Loan
Members willing to pledge marketable securities held in safekeeping with SunCorp may obtain a Securities Loan. The rate can be fixed or variable and is determined at the time of advance. These loans are extended with a set maturity date and typically are not paid down until that date. However, the loan may be paid off early at a credit union's request subject to potential pre-payment fees. The advance amount will not be applied against a line of credit and cannot exceed 98% of the market value of the pledged securities. This is evaluated monthly to ensure proper loan to value.

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Reverse Repurchase Loan
Through a Reverse Repurchase Loan, a credit union may sell a security with the simultaneous agreement to repurchase the same security on a certain date in the future at a predetermined price. Ownership of a security involved in a reverse repurchase transaction does not change. This assures peace of mind to your credit union that is still entitled to all principal and interest payments on payment dates. Maturity terms and rates are determined at the time the repurchase agreement is entered and loans may not be paid off early as they are matched in the market with set repurchase dates. Reverse Repurchase Loans are not applied against your credit union's line of credit, but must not exceed the dollar amount of securities safe kept with SunCorp.

Federal Contingent Liquidity Sources
The NCUA has proposed a rule requiring that credit unions of a minimum asset size obtain access to a federal back up liquidity source - either the Federal Reserve Bank (FRB) Discount Window or the Contingent Liquidity Facility (CLF). To learn more about these sources for emergency liquidity click here.

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Please send me more information on SunCorp's liquidity products

 
CUSO Liquidity Services
Settlement/Overdraft Loan
Demand Loan
Collateralized Loan
Term Loan
Certificate Loan
Securities Loan
Reverse Repurchase Loan
Federal Contingent Liquidity Sources