Callahan chief exec pushes for credit union investment


Sean Hession, president and chief executive of District-based credit union services provider Callahan & Associates. (Jeffrey MacMillan/Capital Business)
January 22, 2012

It’s only been two weeks since Sean Hession settled into his new position as president and chief executive of Callahan & Associates, a District-based provider of analytical services for credit unions. But he has already laid out an agenda of developing avenues for credit union investment.

Hession, who succeeds Chip Filson, a co-founder of the firm who remains its chairman, joins Callahan at a time when credit unions are reporting record membership and deposit growth. With increased liquidity from deposits, Hession said credit unions are pressed to find channels to put that money to work.

Student loans, he said, are becoming a popular product line among credit unions as other private lenders bow out of the business. Callahan is a partner in the Credit Union Student Choice, a cooperative of 215 credit unions offering education financing to their members.

The credit union service organization, or CUSO, enables institutions of all asset sizes to make loans by collectively managing the risks associated with student lending. Hession projects it will exceed $1 billion in loans under management by the end of this year.

The new CEO pointed out that Callahan, through a wholly-owned subsidiary, is also the administrator and distributor for a credit union-owned mutual fund family, Trust for Credit Unions. He is promoting the funds as sound vehicles for credit unions to invest depositors’ money, and has formed a working group to explore other investment products to complement them, including loan participations.

“We see the addition of these products and services as a way to broaden the offering of credit union-designed, credit union-governed investment alternatives that can be offered to the industry,” said Hession, a former vice president at First National Bank of Omaha.

At its core, Callahan is a research and consulting firm that is best known for its credit union directories. The company produces several financial publications and software products, including Peer-to-Peer, to help credit unions analyze performance. Hession estimates the company serves upwards of 1,600 credit unions.

In addition to Hession’s appointment, Callahan will now be owned by its five-member senior management team to ensure the longevity of the firm. “It’s not all that different than the credit union model; the people that are here share in the benefits,” Hession said.

Callahan, founded in 1985, is among a growing number of firms and associations offering credit unions data support, including SNL Financial, Sheshunoff and Moebs Services.

“As credit unions grow and become more sophisticated, analytics become more critical,” said Fred Becker, head of the National Association of Federal Credit Unions, which also provides members with data services. What’s more, “margins are tighter and that requires further examination of the business model and how to make that up.”

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