DALLAS–ALM First is reporting it has closed a $210 million loan fund involving five credit unions under what the company said is the first investment fund approved through the National Credit Union Administration’s Investment Pilot Program, while announcing a second fund focused on home equity loans.
According to ALM First, the ALM First Loan Fund I pooled $210 million from five credit unions to invest in consumer auto loans, providing participating institutions with an alternative means of diversifying their balance sheets and accessing loan investments.
The fund received NCUA approval before its April 2026 launch, according to the company.
“The ALM First Loan Fund gave us something we’ve never had before: an opportunity to diversify our balance sheet in a way that wasn’t available before,” said Michael Hoang, capital markets director at Kinecta Federal Credit Union. “For a credit union our size, that access is a gamechanger.”
How the Fund Works
ALM First said the fund was designed to address longstanding challenges credit unions face in buying and selling loans, including limited access to loan originators, inconsistent pricing and operational expenses.
According to the company, the structure offers several advantages:
- Shared underwriting and operating expenses to improve scalability.
- Transparent loan pricing for both buyers and sellers.
- Additional liquidity options for credit unions selling loans.
- Opportunities for participating institutions to invest excess cash at market rates.
- A clearly defined fee structure.
“For years, credit unions have faced limited access to quality loan originators, inconsistent pricing, and steep operational barriers, with sellers just as often struggling to find dependable buyers,” said Travis Goodman, CFA and principal at ALM First. “The ALM First Loan Fund was built to fix that.”
Second Fund to Focus on Home Equity Loans
Following the closing of the first fund, ALM First said it has opened Loan Fund II, which will focus on home equity lending.
The company said the new fund will provide credit unions with access to loans serving borrower profiles similar to those in unsecured consumer lending, but with residential real estate serving as collateral.
ALM First said it sees opportunities in home equity lending because of elevated homeowner equity levels and the potential for attractive risk-adjusted returns.
“With homeowner equity near record highs, home equity loans offer some of the most attractive risk-adjusted yields available to credit unions right now,” Goodman said. “Fund II gives our investors access to this asset class with the same transparent, efficient structure that made Fund I successful, but with the added security of collateralized loans.”
Participation in the second fund will be limited to 30 federal credit unions nationwide, according to ALM First.
NCUA Approval and Investment Limits
ALM First said its loan fund structure operates under the NCUA’s Investment Pilot Program, which allows approved investment arrangements subject to regulatory conditions.
Under the approval, the fund may invest in consumer loans with maturities of less than 10 years, along with overnight investments.
Participating federal credit unions are subject to an investment limit equal to 50% of their net worth, according to the company.
The structure is intended to allow participating credit unions to pool resources, gain access to loan portfolios and spread certain expenses across multiple institutions.
