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What is CUSO Partners Investments, L.L.C. (CPI)? |
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CPI,
a credit union service organization, is a limited liability company
owned by participating federally and state chartered credit unions. |
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Why would a credit union want to invest in
CPI? |
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CPI permits each
participating credit union to set its individual annual rate of
return. |
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Is
there a limit to the annual rate of return for each individual credit
union? |
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No, the annual rate of return is determined
by each credit union based on the type and quantity of securities
transacted effected on an annual basis. |
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What
activities or services related to the routine, daily operations of
credit unions will CPI? |
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CPI is structured to
effect investment portfolio securities transactions with
Primary Market New
Issue Agencies, Secondary Market transactions for Agencies,
Mortgage Backed Securities and Certificate of Deposits as well as
other Investment Securities allowed by NCUA regulatory guidelines. |
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Does
CPI require special approval from the regional or
national offices of the NCUA? |
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No, CPI will engage in
pre-approved CPI activities authorized by the NCUA. |
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What
is a “participating credit union?” |
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A participating credit union is one having
made the initial capital contribution and requesting to be designated
a “member” of CPI. |
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What
is a “member?”
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In a limited liability entity structure, a
member owns a fractional interest similar to a shareholder in a
corporation. |
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Is a
limited liability company a taxable entity? |
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No, a limited liability company is a
pass-through tax entity with all items of gain, loss, income,
deductions, and credits passing through to the individual members in
amounts as set forth in the Limited Liability Company Agreement. |
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What is
a “limited liability company agreement?”
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A limited liability company agreement
(commonly referred to as an “operating agreement”) is the controlling
document, similar to corporate bylaws, which sets forth the rights,
responsibilities and earnings distributions of the participating
credit unions. |
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What is
the Maximum potential loss for a participating credit union?
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Each participating credit union’s potential
loss is limited to its initial capital investment, such member’s share
of any undistributed assets of the limited liability company, and any
amount previously distributed to such member (only if and to the
extent required by state law.), |
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Who will
manage CPI?
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CPI will be managed by
those participating credit unions designated as “managing members.” |
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What is
the Minimum initial capital investment to become a “non-managing
member” of CPI? |
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Is a
participating credit union required to make any type of additional
investments or contributions? |
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No. |
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Is a
participating credit union required to affect a minimum amount of
securities transactions in any given time period? |
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No, but the annual rate of return by the
non-managing member, is directly proportional to the amount of
effected securities transactions. |
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Who are
the third-party vendors associated with CPI? |
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The Credit Union Group of
Sterne, Agee & Leach, Inc.
(SALI) and Sterne Agee Capital Markets (SACM)
will provide contract underwriting, order execution, compliance,
regulatory, and operational functions for CPI. None
of the contract third-party vendors will be members of the limited
liability company. |
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How will
SALI and SACM be
compensated? |
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These third-party vendors will be
compensated on a split-revenue arrangement. Each dollar ($1.00) of
gross dealer concession will be allocated ten percent (10%) to
SACM for transactional clearing
services, with the remaining ninety percent (90%) of gross dealer
concession allocated equally between
SALI and CPI. |
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Will
CPI effect securities transactions with credit
unions that do not own an interest in the limited liability company? |
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Yes, CPI and its member
credit unions will actively solicit securities transactions with all
federally and state chartered credit unions. |
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Will
CPI provide asset-liability allocation and
management services as is commonly provided by other securities
broker-dealer firms? |
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Yes, these services will be provided at no
additional charge by
SALI |
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Who is
Sterne Agee?
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Sterne Agee is a national NYSE member firm with a
100-year tradition of excellence in the investment securities
industry. |
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Why
would Sterne Agee be willing to make possible this
unique and extremely profitable investment opportunity to all
federally and state chartered credit unions? |
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Sterne
Agee, by and through its affiliation with CPI and its affiliated credit unions, can more
rapidly expand its business from a regional to a national investment
and financial products provider. |
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Who
could I contact for more information on CPI? |
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Who
should I contact for questions pertaining to legal and regulatory
issues? |
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Thomas S. Russell, Attorney at Law,
sirthomas@arkansaslawyer.biz. |
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Is
additional information available in printed or digital format?
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Yes, an excellent PowerPoint presentation is
available on CD and a printed copy of the prototype limited
liability company agreement is available for distribution to your
legal counsel upon request. |
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May I
schedule a personal presentation at my credit union? |
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