LGE Community Credit Union
As a credit union serving the metropolitan Atlanta area, LGE wanted to get clarity on pricing and bond analytics instead of relying solely on brokers and consultants. Read the highlights below or download the full case study.
“
Having the ability to filter through
voluminous amounts of information
and funnel it down into exactly what
is needed to make sound portfolio
management decisions is critical.
Keith Edwards, Vice President of Finance,
LGE Community Credit Union
Situation
LGE has 13 full-service locations in the Atlanta area. The credit union offers consumer banking and insurance, as well as investment accounts such as IRAs.
Credit unions typically follow a high-touch service model, which has become more difficult to deliver amid the current crisis. Face-to-face meetings are occurring less frequently.
Firm-wide alignment path
Discover efficiencies in the price discovery of bonds
Understand the risk profile of a particular security
Enable the finance department to compile and analyze data points more efficiently
Problem
LGE has historically depended on relationships with community brokers and consultants to find, price and execute fixed income and MBS trades. Relying entirely on trust and relationships can prove challenging due to the lack of transparency in pricing. This can be a disadvantage in trade execution.
Another challenge facing LGE has been the need to analyze information about securities and the markets in order to make data-based decisions, which are becoming increasingly important in the industry.
Access to data to help key stakeholders make informed decisions
Transition away from a bullet-and-callable ladder strategy to a spread-based strategy
Solution
Bloomberg’s Agency Prepay Model (BAM), allowed LGE to assess the risk profile of a mortgage security and more accurately forecast future cash flows.
Robust framework helped LGE understand the risk profile of a particular security
Avoided purchasing bonds that can pose greater risks
Helped to prepare for various scenarios
“
One thing that hasn’t changed is providing value to members.
By offering members lower fees, higher yields on deposits and
lower rates on loans relative to other financial institutions, we
are maximizing member value.
Keith Edwards, Vice President of Finance,
LGE Community Credit Union
Benefits
 Interactive spreadsheets and portfolio risk analytics make it easier to slice and dice information efficiently
Easier to download price discovery data on various asset classes
Additional information that helps key stakeholders to make informed decisions.