Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
Wash. state regulators letter interprets dividend
OLYMPIA, Wash. (4/17/08)--Credit unions need to be clear in their advertising and avoid statements that may be misleading, inaccurate or untrue when using the terms “dividends” and “interest,” according to the state of Washington Division of Credit Unions. Linda Jekel, state director of credit unions, sent Interpretive Letter 1-08-03 to state-chartered credit union CEOs April 9. “Since both interest and dividends are allowed for state-chartered credit unions, and every credit union is responsible for handling its own consumer disclosure, it is important to verify that the terms are being used correctly,” she wrote. Many credit unions use the terms interchangeably when, in fact, they are two different things, Jekel wrote. “‘Interest’ is compensation, fixed by agreement, for the use of money, with rights generally enforceable by contract,” she explained. “‘Dividends’ are discretionary payments, distributed from authorized sources, upon approval by boards of directors. Both pay investors in an amount expressed as an ‘APY’--annual percentage yield.” Jekel advised the state’s credit unions to check all forms and advertising materials, including information posted on their websites. She also suggested checking all the fine print and footnotes on all consumer disclosures and advertising, making certain that the terms “interest” and “dividend” are used accurately and consistently, not interchangeably.
Other Resources

RSS print
News Now LiveWire
Reminder: @TheNCUA's Listening Session tomorrow in Chicago. Capacity crowd expected for meeting at 1 p.m. CT. http://t.co/FYYuoHCdVJ
3 hours ago
Mortgage apps up 1.9% in @MBAMortgage's weekly survey http://t.co/QBzKWdnRkH
4 hours ago
Manage your household budget with these 5 @SavvyMoney tips from @MCUA_news's Halley Abbott on @FOX2now http://t.co/qaXIbnNktt
4 hours ago
Wash state's marijuana market open but still short of FIs to serve it via @NWCUA http://t.co/qwxCVEZbPG
5 hours ago
.@AnheuserBuschCU, @ScottCU, @betterwaytobank, @FirstCommSTL on @stltoday's best workplaces list http://t.co/8yR4GcZkya.
6 hours ago