AMERICAN SOUTHWEST CREDIT UNION

ASCU HAS SUCCESSFULLY BEEN IN THE INDIRECT AUTO LENDING BUSINESS FOR 16 YEARS. HOWEVER, DUE TO ENCROACHING OUT-OF-STATE COMPETITION IN THE AREAS THAT THE CU SERVES, ASCU HAS TURNED ITS FOCUS TO A CENTRALIZED LENDING MODEL BY CONCENTRATING ON ITS EXISTING MEMBERSHIP. CU SALES SPECIALISTS NOW SELL ALL FACETS OF A LOAN, INCLUDING THE REFINANCING OF LOANS THAT ITS CURRENT MEMBERSHIP MAY HOLD AT OTHER FINANCIAL INSTITUTIONS. AS A RESULT, DIRECT LENDING HAS NOW OVERTAKEN INDIRECT LENDING VOLUME AS A MAJOR PORTION OF THE CU'S BALANCE SHEET. THE VOLUME OF VEHICLE LOANS (BOTH DIRECT AND INDIRECT) REPRESENTS HALF OF THE ENTIRE LOAN PORTFOLIO. THE GREATEST SUCCESS OF THE PROGRAM RESTS NOT ONLY IN THE DEEP AVAILABILITY TO OUR MEMBER-OWNERS, BUT ALSO IN THE FACT THAT DELINQUENCIES HAVE BEEN RELATIVELY LOW AND MANAGEABLE. THESE PROGRAMS ALSO BENEFIT THE CONSUMER BY PROVIDING AN ALTERNATE LENDING SOURCE TO DEALER AND BANK FINANCING. THESE CONSUMERS QUICKLY FIND THEMSELVES CREDIT UNION MEMBERS WHO NOW HAVE COMPETITIVE RATES OF INTEREST. IMPEDING COMPETITION, BOTH LOCALLY AND FROM NEARBY LARGER MUNICIPALITIES, HAS CAUSED THE CREDIT UNION TO FOCUS ON DIRECT, CENTRALIZED LENDING WITHIN ITS EXISTING AND POTENTIAL MEMBERSHIP BASE. WHILE INDIRECT AUTO LENDING REMAINS A VALUABLE SERVICE TO ALL MEMBERS, ASCU IS NOW CONCENTRATING ON MAKING DIRECT LOANS THROUGH REFERRALS, WALK-IN'S, AND DIRECT MAILINGS TO TARGETED SEGMENTS.

ASCU PRIDES ITSELF IN PROMOTING THRIFT TO THE COMMUNITY AS WELL AS ITS MEMBER-OWNERS. CONSISTENT MARKET LEVEL DEPOSIT RATES ARE AVAILABLE TO ALL DEPOSITORS LARGE AND SMALL. MEMBER-OWNERS HAVE A VARIETY OF AVENUES TO MOVE THEIR MONEY AROUND, INCLUDING DIRECT DEPOSIT, PAYROLL DEDUCTION, ACH ORIGINATION, WIRE TRANSFERS, MOBILE BANKING AND OF COURSE, HOME BANKING SERVICES AND CONVENIENT LOCATIONS FOR WALK-IN TRANSACTIONS. THE MORE SERIOUS INVESTORS CAN TAKE ADVANTAGE OF CERTIFICATES OF DEPOSIT, MONEY MARKET ACCOUNT PROGRAMS, AND IRAS.