The Virtual Investment Pool (VIP) is the first step towards Credit Unions owning a commercial bank. The VIP is the literal pooling/pledging of investment funds by Credit Unions that will allow for joint participation in sophisticated investments that offer higher return investments. The initial size of the pool will be a minimum of $40 million and will give us the Leverage to enter the discussions with Arrangers at an earlier stage where we can better evaluate the risks and negotiate better rates. By pooling our talents, Credit Unions can better identify and manage inherent risks and allow for the best possible risk premium to be negotiated.
The aim of the VIP is to actualize the market leverage of the Credit Unions by pooling resources and competencies in order to provide a return in excess of 3.85% (linked to Commercial Prime)
Returns >3.85%: The CFF will share in the excess return 60/40 (60%-Credit Unions/40%-CFF)