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Alliant & Kaiperm, a Win-Win Situation

September 24, 2008 | Alliant Credit Union

Dear Alliant Member:

Given the turmoil in the financial markets, it's understandable that you may have questions and concerns about Alliant's involvement in a partnership through the acquisition of Kaiperm Federal Credit Union of Oakland, California.

I want to assure you that this is a win-win for Alliant, its members and the members of Kaiperm. Here's why:

Rest assured our Board of Directors took great care to determine that the integration of Kaiperm Federal Credit Union is consistent with Alliant's business model and strategy of providing superior value and exceptional service to employees of mid-sized and large organizations.

Through Kaiperm, Alliant will add approximately 17,000 members with assets of $90 million. We will also gain Kaiser Permanente as a sponsor. Kaiser Permanente is the largest integrated healthcare system in the United States and their employees, retirees and members of The Kaiser Health Plan in Northern California - become potential members. The addition of Kaiser Permanente as a sponsor represents a tremendous opportunity for healthy growth that will sustain Alliant's mission of providing consistently superior financial value and helpful, knowledgeable and memorable service.

Kaiperm presents numerous benefits to Alliant and our members. Here's how:

  • Access to a large and attractive sponsor group to grow membership and deposits, loans and income, at little incremental expense, that will support superior financial value to members
  • Increased scale which will reduce unit costs, strengthening Alliant's cost advantage and further enhancing our financial value proposition
  • Additional presence and access for our 25,000 members in Northern California

Kaiperm has little impact on Alliant's financial operation. Here's why:

  • Kaiperm will add $90 million in assets to Alliant, representing about 1.6% of our total assets, and less than 12% of our asset growth this year
  • Kaiperm will bring approximately $86 million in loans to Alliant's existing portfolio of $3 billion - or less than 3%
  • Kaiperm will add just three employees to Alliant's existing base of 300. The cost of integration will represent less than one month of revenue for Alliant, and will be recouped within less than one year
  • The partnership adds 17,000 new members to Alliant, less than half of our membership growth in 2008
  • Alliant maintains over $630 million in capital reserves, nearly double the amount considered by federal regulators to be "well capitalized." The addition of Kaiperm will have negligible impact on capital levels
  • State and federal regulators strongly support Alliant's partnership, through acquisition, with Kaiperm

Alliant has a 73-year track record of successfully serving our members' interests. The Alliant Board of Directors, senior executive team and employees are excited about the Kaiperm integration and believe it is an excellent fit for both institutions - a win-win for Alliant and our members.

Sincerely,
David Mooney
President/CEO - Alliant Credit Union

 


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