MADISON, Wis. (8/2/10)--CUNA Mutual Group will fine-tune its operations as it heads into the future to build on momentum from the changes it has made in recent years. “We have to continue to do the things we’re doing to make ourselves more efficient,” CUNA Mutual CEO Jeff Post, who arrived in 2005 to restructure the company, told (Wisconsin State Journal
Aug. 1). “I got a lot of questions when I first got here--people almost with their eyes closed, (saying), ‘Tell me when it's over,’” Post told the newspaper. “But the world keeps changing, so to think your business doesn't have to change is a bit naive. Our business doesn't stand still.” With credit union consolidation and competition from other insurance companies, CUNA Mutual’s board directed Post to make core operations more efficient and to position the company for new growth opportunities outside the credit union sector, he told the paper. Those changes resulted in program cuts, repositioning, job losses and reorganization that is ongoing today. “I knew that change would be tough for the organization and that there would need to be a fair amount of it,” Post said. “On the credit union side, our goal was to shrink the number of products to what we did well. We also wanted to build some businesses outside the credit union space.” CUNA Mutual will continue to modify its credit union operations while keeping an eye out for opportunities to diversify its products and markets, Post told the paper. Some of the company’s major acquisitions and divestitures in keeping with those goals include:
* The June 2009 purchase of CPI Qualified Plan Consultants, a Kansas-based administrator of employee benefit plans. The move doubled CUNA Mutual’s stake in the retirement-plan business and was its first full-scale venture beyond the credit union marketplace. The company administers about 7,500 retirement plans with assets nearing $10 billion, about half for clients outside the credit union market. * The July 2009 sale of its IRA Services division to Ascensus, a retirement services firm based in Dresher, Pa. The division’s 47 employees kept their jobs in Middleton, Wis. Post said CUNA Mutual couldn’t compete effectively against a much bigger main player in the market. * The September 2009 purchase of Producers Ag Insurance Group, an Amarillo, Texas-based crop insurer that serves farmers and agricultural producers nationwide. At CUNA Mutual, Pro Ag is a stand-alone subsidiary with about 400 employees. Crop insurance is a new business for CUNA Mutual, but one that Post had experience with at his prior company, Fireman's Fund.
CUNA Mutual last month raised $85 million by selling fixed-rate, 20-year surplus notes to investors for the first-time, the paper said. A surplus note is a bond-like instrument that pays an interest rate and has a finite maturity. Company officials hope the added capital will help CUNA Mutual grow or diversify, the paper said. For the full article, use the link.