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CU System briefs (01/15/2013)

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  • CINCINNATI (1/15/13)--A former head teller at Cincinnati-based Cinco Family Financial Center CU has been accused of taking $600,000 from the credit union by removing $100 bills from stacks and substituting $1 bills sandwiched between two C-notes (Associated Press Newswires and Jan. 11). If convicted, Linda Fite, 52, faces a potential sentence of three years in prison. The thefts allegedly occurred for nearly a decade beginning in 2003, said Hamilton County prosecutor Bill Anderson. Auditors never audited the large bags of money when delivered. They decided on Jan. 25, 2012 to audit the bags, which Fite supervised. Anderson filed an "information," designed to let a person bypass a grand jury indictment and plead guilty …
  • ATLANTA (1/15/13)--Atlanta-based Mutual Savings CU has named Jennifer Fiorenza as president/CEO, effective April 1. She replaces outgoing President/CEO Mike Bryan, who led Mutual Savings for nine years. Fiorenza is assistant controller of AGL Resources, has served on the $70 million asset credit union's Board of Directors for three years and is a member of its Asset/Liability Management Committee and the Policy Committee. She brings 30 years of financial management experience, 23 of them with AGL Resources. Mutual Savings was founded to serve employees of the company …
  • WICHITA, Kan.(1/15/13)--Meritrust CU's board announced that James Nastars will become the Wichita, Kan.-based credit union's new president/CEO, effective Feb. 18. Nastars brings more than 16 years of credit union executive experience as senior vice president of lending and collections at the $1.5 billion asset University FCU in Austin, Texas. Nastars also serves on the board of UFCU Financial Services and CU Business Solutions, and is  board president for North Central Catholic School Corp. in Austin. Interim President/CEO Byron Stout will return to his role as vice president of human resources on Feb. 18 …
  • BASKING RIDGE, N.J. (1/15/13)--Robert Birkhahn, executive vice president of Affinity FCU, died on Jan. 9 in Miami, Fla., according to the New Jersey Credit Union League (The Daily Exchange Jan. 14). He was 49. Birkhahn was also chief member relationship officer at the Basking Ridge, N.J.-based credit union, and he served as CUMAnet's managing director. Affinity FCU President/CEO John Fenton will assist during the transitional period, said the league.  Services for Birkhahn were Monday in Fair Lawn, N.J. (The Record/Herald News Jan. 12) …

Student lending can be a good niche for CUs

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WASHINGTON (1/15/13)--Loan-starved credit unions seeking to expand their portfolios take note: The latest student lending trend could lead to a new lending market among existing prime members, says the Credit Union National Association.

During third quarter 2012, non-federal guaranteed student loans at credit unions increased 20% year over year to $1.93 billion, according to CUNA.  Although they represent a small percentage (0.3%) of credit unions' loan portfolios, the average age of the co-signers on these loans is 47-49 years--in line with existing members' average age.

"It is growing tremendously for credit unions--to about  $2 billion. CUs are having a hard time finding loan growth. This could be a nice niche for us," said Paul Gentile, CUNA executive vice president of strategic communications and engagement, in a call with trade press Monday.

"If you watch the news, there are so many negative stories about student loans, yet student loan delinquency in credit unions is 1.45%--so credit unions are doing something right," Gentile said.

Credit unions are also benefiting from new regulations, particularly the Higher Education Opportunity Act, said Vince Passione, CEO of Fynanz, a private student loan company and CUNA Strategic Services provider.

Around 2008, during the post-credit crisis when other lenders left private student lending, "credit unions stepped in," said Passione. "They architected all their student loans programs following the regulation."

The act requires lenders to disclose to students and parents that the loans are non federal guaranteed private loans, and ensure they understand the cost of borrowing. It also requires lenders to educate. Schools are certified, and the students don't overborrow. "Students are required to exhaust all other avenues first before taking a private student loan," Passione said.

Fynanz's  program requires students to make payments while still in school,  "so they begin good repayment habits early," said Passione.

Student loan delinquencies at credit unions--1.45%  for a 60-day loan-- are lower than banks' loans but higher than the 1.13% delinquency rate of  all credit unions loans. That compares with 5.3% of delinquent loans in the general student loan market and 12% when federal loans are factored in, said CUNA.

Will student loans present a concentrated risk if the economy dips again? CUNA Chief Economist Bill Hampel said no. "Even if the current loan rate continues for a decade, there would still not be enough concentration in this market," he said. "For some individual credit unions, if they got into [student loans] big, they might see a little more [risk]."

Today, 581 credit unions offer private student loans, compared with 488 a year ago, said Passsione. Roughly  2,000 schools and universities offer Fynanz's student loans, said Passione. For more information, use the link.

Firstmark CU sponsors Student Aid Saturdays

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SAN ANTONIO (1/15/13)--Firstmark CU in San Antonio is helping sponsor Student Aid Saturdays, a program that helps high school seniors who are heading off to college or to a technical program and their family members fill out their college financial aid forms.

Local high schools, college campuses and at Cafécollege in San Antonio will host SAS. This year, the program is sponsored by the $758 million asset Firstmark and is in partnership with SA2020, the Greater San Antonio Chamber of Commerce, San Antonio Education Partnership, and Generation TX San Antonio.

"The impact of Student Aid Saturdays has a ripple effect in our community," said Leon Ewing, president/CEO of Firstmark CU. "It immediately helps students who need assistance get into college. That, in turn, produces a better-educated work force, which ultimately is good for our community. We hope other San Antonio companies will follow suit and sign up to help."

Most colleges and universities require the Free Application for Federal Student Aid form for a student to qualify for any financial aid, including many scholarships. San Antonio still has a low rate of completion of the FAFSA forms. SAS aims to raise that level. This is the second year of the program. During the first year, more than 1,000 students and families participated.

Ostrowski named Worldwide Foundation for CUs director

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Click to view larger imageCalyn Ostrowski was named Worldwide Foundation for Credit Unions director by the World Council of Credit Unions.  She will manage the foundation's supporter funding and network to help expand WOCCU's international credit union development and education initiatives. (Photo provided by the World Council of Credit Unions)
MADISON, Wis. (1/15/13)--Calyn Ostrowski has been named director of the Worldwide Foundation for Credit Unions, the charitable arm for the World Council of Credit Unions.

As director, she will manage the foundation's supporter funding and network to help expand WOCCU's international credit union development and education initiatives.

"The assistance we receive from World Council Supporters is vital to the work we do each day," said Brian Branch, WOCCU president/CEO. "Calyn's proven track record in international development and dialogue make her an excellent fit for building and expanding our global community."

Ostrowski most recently led program, operational and fundraising initiatives for the Global Health Initiative at the Woodrow Wilson International Center for Scholars, a foreign policy think-tank based in Washington, D.C. While there, Ostrowski developed and facilitated public policy dialogue programs to increase global health education and political willpower among domestic and international policymakers, nonprofit organizations, corporations, media and donors to improve the economic, social and physical well-being of communities in developing countries.

Ostrowski managed the GHI grants administration process and also developed policy dialogue programs for the center's Environmental Change and Security Program. Her fundraising strategies helped secure a record-high increase in GHI's revenue.

Ostrowski joins WOCCU's headquarters in Madison, Wis.

Illinois league hosts small-CU follow-up workshops

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NAPERVILLE, Ill. (1/15/13)--The Illinois Credit Union League hosted a round of additional small asset-size (SAS) workshops for credit unions with less than  $25 million in assets this winter, as a follow up to "Lunch and Learn" meetings held in 2011.

The programs, dedicated to driving financial health and member growth by providing SAS credit unions the tools needed for success, were hosted in Springfield, Kankakee and DeKalb.

Roundtable topics shared by the Illinois Division of Financial Institutions, National Credit Union Administration, CUNA Mutual Group, Alloya Corporate FCU in Warrenville, Ill., and others included information on non-interest income, regulatory concerns, marketing and Automated Clearing House compliance.

"If there's one thing that stands out in our industry, it's the ease in which small credit unions share and learn from each other and the value that comes from this unique quality that our industry possesses," said Joni Senkpeil, ICUL director of small credit union development.

The ongoing effort is an endeavor to study small-credit union challenges, offer resourceful solutions, and help secure the strength of the state's small-credit union community.

The league originally launched the "Lunch and Learn" workshop series in 2011 via a new SAS Advisory Group exclusively for credit unions under $25 million in assets as part of a statewide action plan for SAS credit unions in Illinois. 

The advisory group was charged to create a plan that will provide a necessary and unique opportunity for credit unions to shape distinct and permanent SAS workgroups across Illinois. It includes four priorities for action, including: reducing the regulatory and compliance burden; promoting collaboration; enhancing communication; and increasing competitiveness.

Study: Cause marketing? Be authentic

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MADISON, Wis. 1/15/13)--Credit unions have an advantage when it comes to cause marketing: Their already solid reputation with consumers and dedication to the people-helping-people philosophy.

While the majority of U.S. Internet users have been moved to purchase because of a cause, shoppers expect greater accountability from organizations involved in cause marketing and reassurance that their support is making a difference, according to a new eMarketer report, "Marketing 'Good': How Causes Can Convert Online Shoppers" (eMarketer Jan. 8)

A growing number of consumers considered "social purpose" as the leading purchase driver when quality and price were equal, according to a study the Edelman's "good purpose" study.  However, only 10% surveyed thought that cause marketing campaigns were sincere.

To employ cause marketing effectively, organizations must be viewed as authentic by consumers, the study said.

Would consumers trust credit unions to make a difference with cause marketing? Trust in credit unions has remained high at 61% among Americans, according to the latest Chicago Booth/Kellogg School Financial Trust Index (News Now Nov. 6). The index has consistently reported notably more trust in credit unions than local and national banks, quarter over quarter, since it began in December 2008.

Community Financial CU, with $502 million in assets, Plymouth, Mich., is among the credit unions engaged in cause marketing. The credit union asked its members and community members to take part in its "Warming Hearts & Homes" campaign (PR Newswire Jan. 14).

Community Financial CU raised $30,000 for The Heat And Warmth Fund, local food pantries and the Salvation Army's Coats for Kids program.

The credit union donated $25 for every like on Facebook, tweet on Twitter or text message it received during the holidays.

Richland FCU manager named to Minneapolis Fed advisory council

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SIDNEY, Mont. (1/15/13)--Kevin Mayer, manager of Richland FCU, Sidney, Mont., has been appointed to the Community Depository Institutions Advisory Council of the Federal Reserve Bank of Minneapolis.

Mayer will serve a three-year term with 10 others in an advisory capacity and help the Federal Reserve better understand the business and economics in the region.

"We are the eyes and ears of our region," said Mayer. "Our discussion is heard by those in Washington, D.C."

Tracie Kenyon, president/CEO of the Montana Credit Union Network, said the appointment is a great honor. "His appointment underscores the truly amazing work that he's done in the community, state and region. From the state trade association perspective, I am always delighted to have Montanans at the table, and Kevin will represent the interests of his peers exceptionally," Kenyon said.

Mayer has been with Richland FCU since 1985. Aproponent of financial education, he serves on the business advisory council at Sidney High School. Each year he speaks to eighth grade students about the overall importance of finance, and he visits with them again when they are seniors to discuss the value of how credit is earned.

He serves on the Board of Directors of Kansas Corporate CU, was a member of the MCUN's Government Relations Committee. and is an advocate and mentor to many small credit unions in eastern Montana.

Sacramento Bee: CUNA's Mad City Money part of ed trend

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SACRAMENTO, Calif. (1/15/13)--The Credit Union National Association's Mad City Money program, a personal finance money management exercise for high school students, is part of a new trend in financial education--role playing, say experts interviewed in the Sacramento Bee (Jan. 13).

"It's a safe environment to make mistakes," Shannon Heaps, SAFE CU's financial literacy coordinator, told the Bee.  "If they buy a big, new car, they might not be able to buy (designer clothes)."

Heaps said that students will not learn from someone lecturing them with the save-your-money message. "This is hands on and it lets (teens) learn from their mistakes."

The event was coordinated by the school's business academy, which includes three student-run businesses: a campus store, a recycling center and a SAFE CU branch.

"Events like Mad City Money, created by CUNA, are designed to help students learn those hard lessons before they leave home," said the publication. 

California JumpStart Coalition Chair Karen Anderson told the publication that there is a proliferation of role playing games to engage teens. "It's part of a change in financial education," she said.

Jim Allen, SAFE vice president of community banking, also noted that money management education is needed by adults as well as high school students. 

To read the full article, use the link.

CU opens Staten Island branch postponed by Sandy

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BROOKLYN, N.Y. (1/15/13)--While all branch openings are a measure of a credit union's growth, Polish & Slavic FCU's Dec. 15 grand opening of its first branch on Staten Island had a special significance: The opening had been delayed by Hurricane Sandy.

After Sandy struck Oct. 29, not only did the Brooklyn, N.Y.-based credit union have to repair the damaged branch, scheduled to open Nov. 5, it also assisted its new neighbors in recovering from the storm (PRNewswire Jan. 14). The credit union collected clothing and other items for hurricane victims. Items were donated through local parishes and community organizations.

Also, the credit union's mobile branch also moved throughout the area where branches were inoperable to assist members.

PSFCU has 16 branches throughout the metropolitan New York City area and Chicago.