Benchmarking Your Retail Investment Services Program

Credit unions’ retail investment services programs have moved beyond early adopter and growth phases. How can your program expand and maintain productivity and quality?


To effectively manage member delivery channels, credit unions are increasing their focus on improving upon their operational, infrastructure and process efficiencies. Call centers track and monitor response time and abandon rates; real estate origination departments look at active loans, and "pull-thru" rates; branch managers track teller activity and deposits generated. The traditional delivery channels have established metrics, however, how do newer channels, such as a retail investment services program, benchmark performance?

There are two primary ways of measuring various efficiencies. The financial model analyzes the income and expense components of the investment services program itself, ensuring fiscal health. The second measurement is based on relationships, or the direct impact that a well-integrated investment services program has on the parent credit union. Individual components would include the impact on credit union deposit or loan balances with an investment account as well as impact on the services per household metric at the credit union. According to a Raddon Financial Group survey, credit union members who participated in the retail investment services program had an average loan balance of $12,136 and average deposit balance of $26,755. A member with no relationship with the retail investment services program had an average loan balance of $7,106 and average deposit balance of $9,306.

Key Benchmarking Questions
The programs that have offered retail investment services to their members for a longer period of time have a good understanding of the dynamic in the delivery of investment services to members. If a financial consultant reaches capacity in members, it is difficult to maintain the desired level of service on existing investment accounts while at the same time focusing on growing the overall program. Credit unions looking to benchmark their retail investment services program should consider the following issues:

  • Staffing:
    • Do we have appropriate staffing to manage our existing accounts?
    • Do we have staffing to support growth objectives?
  • Compensation:
    • Are we properly incentivizing financial consultants to open new accounts?
    • Are there better ways to compensate staff to increase staff retention?
    • Should front-line staff receive compensation for referrals to the retail investment services program?
  • Expenses:
    • Are our expenses in line with similar programs?
    • Are there opportunities to lower expenses by structuring our program differently?
  • Structure:
    • How are credit unions of similar sizes managing their investment programs?
    • Do we need to expand our licensed staff or support staff?
  • Revenue:
    • Is the level of gross revenue from this channel, relative to your credit union's size, in line with others?
    • How does your program's net income contribution to the credit union compare to similar programs

The key consideration for credit unions, of course, given the increasingly competitive environment and tighter spreads, is to add operational and service support in a fiscally responsible way to ensure that the credit union's key ratios continue to improve. As credit unions continue to evolve their investment services programs, setting and tracking performance benchmarks will be key to moving to the next growth curve for the channel.