RANTOULE, Ill.-Shared branching's benefits are clear to Credit Union 1: over $100,000 in additional annual revenue and a significantly lower attrition rate.

CEO Paul Simmons said the $680-million CU netted $72,000 in revenue during the last year and projects the total to top $104,000 during the next 12 months. "That is pretty significant these days when we're all working hard for every dime we can add to the bottom line," Simmons said.

Credit Union 1 has 28 full-service locations-20 are open to shared branching-and Simmons said the co-operative arrangement is helping dramatically support the costs of running all those offices.

Joining the CU Centers network in 2004, three years ago Credit Union 1 opened its own branches to shared branching transactions. It took the CU until January 2008 to cross the threshold where the income received from acquired transactions exceeded what it paid for its members performing transactions at other credit-union owned branches. "For example, in April of 2010 we netted $7,152 in excess of our costs," said Simmons, who explained the revenue keeps increasing.

Shared branching's advantages were not always evident to the credit union, admitted Simmons, who said Credit Union 1 was hesitant to move to shared branching in early 2004. "Before we got involved I used to wonder if I really wanted to send my members to another credit union, especially out of state. Wouldn't they just want to join the credit union that's in the shared branch network? But that doesn't happen, not at all."

Participating in the CU Centers network has slowed attrition, too, according to Simmons. With Credit Union 1 being a former military CU and having members move across the country, MSRs and call center staff are trained to let members know they can stay with Credit Union 1 when they move away by using a shared location. Simmons estimated that 35% of members who inform the CU they are closing their account because they are moving now stay with CU1. "Moving went from being the number one reason people left the credit union to number two, behind the credit union closing members' accounts," explained Simmons.

Not every location is right for a shared branch, pointed out Simmons. If a branch has a great deal of member traffic, Credit Union 1 will not open it to shared branching until it is expanded, including adding more parking.

Beyond the revenue and member retention, shared branching does a great deal for the CU movement, helping to further separate it from banks, concluded Simmons. "It makes a whole lot of sense. Credit unions are cooperatives and banks are for profit. It sends a message to consumers that credit unions work together."

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