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CENTRIX Financial to Open Power Dealer Network

September 27, 2005

CENTENNIAL, Colo. –- CENTRIX Financial, looking to service its "best and most valued dealers," is gearing up to launch a Power Dealer Network.

After regulatory action by the National Credit Union Association, the company is going to limit the number of loans it approves, reported. Additionally, it has been finding alternative funding sources while credit unions aim to reach full compliance with new federal guidelines.

The NCUA issued a risk alert in June to federally insured credit unions after noticing more and more credit unions were engaging in outsourced, indirect, subprime automobile lending.

The risk alert had credit unions acting to suspend subprime lending until specific regulations were set in place and they could prove their compliance with the agency’s guidelines to on-site auditors, the report said. reported that a letter from CENTRIX chairman and CEO Robert Sutton to its dealer partners warned that certain credit unions may be unable to originate loans for some of their retail customers.

Through the Power Dealer Network, CENTRIX officials said that until the company was at 100 percent funding again, it would be working with dealer partners before funding any direct-to-consumer loans.

As a result of the regulatory guidelines and the drop in the number of credit union loans, the Associated Press reported that CENTRIX recently had to lay off 150 employees, or 10 percent of its workforce.

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