Understanding Activity Branch Assignments

To configure these Branch Assignments, go to this screen.

CU*BASE uses three* branch assignments when working with members:

Member Branch - This is the branch number assigned to the master membership record and all of this member’s account relationships. Some organizations call this the “Asset Branch.” This is somewhat of a misnomer because it also includes accounts that are tracked as liabilities on the CU’s balance sheet. But when a credit union runs a member trial balance or financial report, the branch accounting system segments based on the Member Branch.
Transaction Branch - For each transaction record, the branch at which the transaction was posted is stored. Therefore, a member may be assigned a Member Branch of 01 because they joined at the main branch, but do a withdrawal on their way home from work at branch 04. Transaction branch analysis is key to branch activity levels and the accounting of vaults and cash activity.
Activity Branch - This new designation allows the CU to have an alternative view to how assets are assigned to branches. In other words, suppose the member branch was not assigned by where the member joined the CU, but where the member actually does his business—how would that change our analysis.
*NOTE: A fourth designation, “Most Used Branch,” which evaluates member visits, is used only by the new Branch Reassignment tool.

For example, a CU has three branches and 30,000 members. Their member branch analysis looks like this:

Branch	Shares	Loans	# of Members
01	$45,000,000	$22,000,000	15,000
02	$37,000,000	$16,000,000	10,000
03	$10,000,000	$5,000,000	5,000
	$92,000,000	$43,000,000	30,000

Branch 01 is the original branch of the CU and is closest to the main sponsor that started the CU 20 years ago. Since then, the CU merged another CU and designated that credit union’s main branch as 02. These two locations are approximately 20 miles apart. Based on the merger, the CU saw a need to open a third branch halfway between the existing branches. Branch 03 is basically a community branch serving the members who live between the two primary sponsors that make up the merged CU.

When we do an Activity Branch analysis and run our asset analysis by activity branch, the credit union looks like the following example. This is based on assigning Activity Branch based on where members do at least 40% of their transaction activity.

Branch	Shares	Loans	# of Members
01	$15,000,000	$5,000,000	3,000
02	$29,000,000	$21,000,000	10,000
03	$48,000,000	$17,000,000	17,000
	$92,000,000	$43,000,000	30,000

These results might be analyzed as follows:

Branch 01 is the oldest branch, but most family members have moved away from the original sponsor factory location. These are the older members and therefore loan accounts are smaller.
Branch 02 still has a great deal of loyalty from the original CU sponsor’s membership base, and is a very active branch and very comparable to the time of the merger.
Branch 03 is our growing community branch based on where our members and their families live. While fewer people have actually joined the CU through this branch, it is now the largest branch based on where the majority of members do their business.

Remember that Activity Branch is not an “assigned” designation like the member branch. Instead, it is calculated as needed for various reports and inquiries based on parameters you define (see below) to reflect where a member actually does business with the credit union. Although some systems actually use activity analysis to reassign the member branch, CU*BASE uses this separate calculated Activity Branch designation so as not to lose key information about the member’s origin and history.

Calculation Example

The following chart shows a month’s worth of activity for a member that is assigned to Member Branch 03. The parameters used for calculating activity branch are the same as in the sample above (40%, origins 01 and 03). The member had 10 share draft transactions and 8 ACH transactions that were posted by the main branch 01. (These were not considered part of the activity analysis, and therefore not reflected in the Analyzed Transactions figures.)

Activity Branch	Total Transactions	% of Total	Analyzed Transactions	% of Analyzed
01	20	66.7%	2	20.0%
02	6	20.0%	6	60.0%
03	2	6.7%	1	10.0%
04	2	6.7%	1	10.0%
	30		10

If we analyzed all transactions the member had in a month, his activity branch would be 01. If all back office activities were posted through a single branch, which is common in many credit unions, the activity branch would be skewed toward branch 01.

When we exclude all transactions except origin codes 01 and 03, we get a different picture. When only 10 lobby and lending transactions are analyzed, and the greatest percentage of the member’s activity is at branch 02. In summary:

The member’s asset (member) branch is 03.
The member had transaction activity at four different branches.
Considering only teller and lending department transactions, the member’s primary Activity Branch is calculated as 02.

NOTE: If a member’s activity is evenly distributed among the branches, and at least 40% (or the configured percentage) of the transactions don’t fall at a particular branch, then the activity branch would be the same as the member branch.
In analyzing the file on an aggregate basis, it will be interesting to understand how many members had member branches different from their activity branch, and how that affected facility and employee resources. View these reports from this report: Member TB Summary by GL Account.