Originally published by CUNA Councils .
High performing credit unions understand the importance of evaluating all asset classes, including whole loans, when constructing their balance sheets. Just like a securities investment or loan origination, incorporating the secondary whole loan market into balance sheet strategy can often improve your credit union’s performance.
1. Establish characteristics The most direct driver of a loan pool’s price is the characteristics of the collateral itself. These include:
Coupon (WAC) Credit quality Weighted average maturity (WAM) Servicing type
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