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First of year reaps dividends to members

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MADISON, Wis. (1/18/11)--Credit unions taking stock of their balance sheets for the end of the year are busy returning dividends to their members. A number of credit unions recently announced that their members would reap patronage dividends--just another way that credit unions differentiate themselves from other financial institutions. Among them:
* Wright-Patt CU, Fairborn, Ohio, paid $4 million in special patronage dividends to members on Jan. 4, according to the $1.9 billion asset credit union's website. Each eligible member received at least $10, and the average member earned $22.94 last year. Dividends are based on how many services its 202,000 members use. Since 2008, the credit union's goal has been to pay the dividend every year. It has paid $11 million in dividends in the past three years. "We were able to pay this year's …dividend because new members joined WPCU in 2010 and many members took advantage of our excellent savings rates and low rates on loans," said the credit union. * DFCU Financial CU in Dearborn, Mich. reported $19 million in special patronage dividends for its 85,000 members, who received the dividend on Jan. 5. That averaged out to roughly $224 per member. CEO Mark Shobe said on the $3 billion asset credit union's website that the dividend differentiates the credit union from banks. "The dividend is virtually impossible for banks to do. They can't match this." The payout is calculated on the member's total relationship with the credit union--the greater the relationship, the larger the dividend. Qualifying members received 0.5% dividend on their average loan and deposit balances, with each eligible member receiving at least $50. * In Oklahoma City, Okla., FAA CU announced an end-of-the-year rebate for the 10th consecutive year. The credit union returned more than $300,000 to its 45,000 members by direct deposits into their savings accounts with the amounts reflected on their year-end statements. Accountholders with most loan types received a 2% rebate on interest paid in 2010 and most accountholders earned a 2% bonus on dividends earned during the year. "Even though this year continued to present challenges for the financial industry, FAA CU remains strong and our members deserve to be rewarded. Their continued support is what allows FAA CU to prosper and our success means success for them," said President/CEO Steve Rasmussen. * Eastman CU, Kingsman, Tenn., reported handing out $4 million in extraordinary dividends to its 111,000 members--both savers and borrowers. The dividend averaged to $36 per member, said the $2.3 billion asset credit union. * CoVantage CU, an $824 million asset credit union based in Antiago, Wis., announced a $1.5 million patronage dividend--the 25th year it has offered rebates. There are two components to the payment--a savings bonus that provides an additional dividend on earnings paid on select deposit accounts, and a loan interest rebate that returns a portion of the interest members paid on their loans, said the credit union's website. "This year's $1.5 million patronage payment will put money back into the hands of our members and back into the communities we serve," said Board Chairman Bob MacIntosh. "That's what belonging to a credit union is all about." CEO Brian Prunty noted that much of the credit for the credit union's success is "due to the support of our members. We are more than a financial institution, our members own the credit union, and as owners they too share in its successes." * In Schaumburg, Ill., the $723 million asset Motorola Employees CU (MECU) members received more than $1 million in patronage dividends. "In keeping with our promise to put our members first, returning a portion of that money to members is simply the right thing to do--and it also serves to reward those who have supported the credit union over the past year," the credit union said on its website. All members in good standing with active accounts got a minimum $5 deposited to their savings; on average, members received $30 each. The most active members received more than $100.
Most of the credit unions cautioned that while they intend to pay a special dividend every year, it is not guaranteed and the dividend amount depends on the credit unions' financial performance.

Regulators approve Star Energy Chevron merger

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BAKERSFIELD and OAKLAND, Calif. (1/18/11)--Star Energy CU, Bakersfield, Calif., has won approval from the National Credit Union Administration (NCUA) and the California Department of Financial Institutions (DFI) to merge with the much larger Oakland, Calif.-based Chevron FCU. The next step is to get approval from California's Secretary of State, according to the Bakersfield Californian (Jan. 14). Both credit unions serve primarily employees of Chevron and their families and have talked about a merger on and off for years, Chevron told the newspaper (Jan. 13). Star Energy CU, a 74-year-old state-chartered credit union with about 1,500 members, saw its capital ratio of 6% drop to 3.8% in September from a 6% ratio in June. Its total assets declined by more than $1 million to $5.9 million in the 12 months ended on Sept. 30. Chevron's capital ratio stood at 10.7% in September. It has about 70,000 members and about $1.5 billion in assets.

Southwest Bridge Corporate begins merger vote this week

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PLANO, Texas (1/18/11)--Southwest Bridge Corporate members will have a special member meeting Thursday afternoon to discuss the proposed business model for the future of the corporate--a merger of the corporate into Georgia Corporate FCU--and to begin voting on that model. The meeting will be held from 2 p.m. to 4 p.m. CT to present the business model recommended by the corporate's Member Advisory Council, to provide information about the five alternative business models considered and the pros and cons of each model, and to answer questions, said a notice sent members by Kerry A.S. Parker, chairperson of the council's Executive Committee and CEO of Austin, Texas-based A+ FCU. Members can vote either through a mailed or faxed ballot, which must be received by Jan. 26, or by voting electronically at the special member meeting webinar on Thursday. In the member notice, the corporate noted that "by casting your vote, you are not committing to re-capitalization, or continued use of Southwest Bridge Corporate's Services. The importance of this vote is to determine the level of member support for the Member Advisory Council's recommended business model, which is Business Model 1." Southwest at one time had $9 billion assets, while the former Georgia Central Corporate had $2 billion in assets. Under the merger proposal, Southwest Bridge Corporate members would own and control the consolidated corporate, having eight board seats while Georgia Corporate has one board seat. The new nine-member board would select the CEO of the combined corporate. The merger would require a lower capital investment than historically required, would continue to provide lines of credit, and would maintain access to all the services in the current structure so no conversions would be required for Southwest members. The combined corporate also would provide a one-stop shop for all services and remain the same low cost provider with the same member service. "It will assure strong continuity of services, some economies of scale will be gained, and the model is scalable and efficient, positioning the consolidated corporate for future consolidations with other corporates which will continue to increase economies of scale," said the business model descriptions. The merger could be executed by mid-2011 but requires perpetual contributed capital. Results of the electronic voting and the mail/fax ballot will be announced on Jan. 28.

Northwest CU Association selects board officers

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FEDERAL WAY, Wash., and BEAVERTON, Ore. (1/18/11)--Bill Anderson, president/CEO of Mid Oregon FCU in Bend, Ore. has been named the new chairman of the Northwest Credit Union Association, and Debie Keesee, president/CEO of Spokane (Wash.) Media FCU was named vice chair. The memberships of the Credit Union Association of Oregon and the Washington Credit Union League voted “overwhelmingly” in November to affirm the creation of the combined Northwest Credit Union Association (NWCUA). The new association began operations Jan. 1 (News Now Nov. 12). “The creation of a new, regional credit union trade association is an exciting task filled with opportunities to advance the regional economy that these 18 future-focused leaders are well-qualified to accomplish,” Northwest Credit Union Association CEO John Annaloro, told News Now. Other elected table officer CEOs include:
* Secretary--Marshall Ellison, Twinstar CU, Lacey, Wash.; * Treasurer--Gene Pelham, Rogue CU, Medford, Ore.; * Executive Committee--Jack Fallis, Global CU, Spokane, Wash. * Executive Committee--Jean Wheat-Palm, North Coast CU, Bellingham, Wash.
Also, 12 CEO directors were elected:
* Terry Belcoe, North Coast CU; * Elliot Gregg, Kitsap CU, Bremerton, Wash.; * Tom Graves, Prevail CU, Seattle; * Phil Jones, Harborstone CU, Lakewood, Wash.; * Larry Hoff, Fibre FCU, Longview, Wash.; * Mina Worthington, Yakima Valley CU, Yakima, Wash.; * Bob Newcomb, SELCO Community CU, Eugene, Ore.; * Shirley Cate, Providence FCU, Milwaukie, Ore.; * Diann M. Owen, Clackamas FCU, Oregon City, Ore.; * Steve Canfield, NW Preferred FCU, Tigard, Ore.; * Rob Stuart, onPoint Community CU, Portland, Ore.; and * Trisha Baker, UFCW Northwest FCU, Portland, Ore.

O Bee CU leverages technology to Capture the Tag

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TUMWATER, Wash. (1/18/11)--O Bee CU, Tumwater, Wash., has created a digital age version of the childhood game “Capture the Flag” to attract consumers to the websites of local businesses. “Capture The Tag” participants armed with their smart phones are unleashed on a treasure hunt to scan and collect 30 Microsoft MS tags that play videos giving them clues to the location of the next tag, along with personal finance tips and advice, until they find and visit all 20 participating businesses (the tag sites). The game is the brainchild of $137 million O Bee CU, while the promotion is co-sponsored by 94.5 ROXY, Olympia; The Olympian, Olympia; TwinStar CU, Olympia; The Washington State Department of Credit Unions, Tumwater; Helix Group, Olympia; and NW Media Company, Lacy. Participating businesses can offer their own discounts and incentives as part of “Capture The Tag,” but no purchase is required to participate. Clues and contest information also will be featured on the sites of all the co-sponsors, as well as “Capture The Tag” Facebook and Twitter pages. Everyone who collects all 30 tags is invited to an end-of-contest Tag Party, where they are eligible for the prize drawing at the end of the night. First prize is $10,000. Second prize is $3,000. Third prize is $2,000. In addition, five other entrants will win Apple iPads. “There is a whole lot going on here,” said Lee Wojnar, vice president of marketing for O Bee CU. “We want to both engage and challenge Generation X and tech users to socially connect offline, as well as online, in pursuit of some nice rewards. In the process, they’ll get an introduction to some area businesses where they can become customers, they’ll get some personal finance lessons, and in the end, they'll get a chance to come together at a great party, where they could win some very attractive prizes. While we have built in some nice incentives, there are plenty of opportunities for fun and knowledge along the way,” he added. The game officially starts on Friday. Entrants have to be 18 years of age or older, but can sign up at CaptureTheTag.org, where they will find video instructions and contest rules. The site also provides a link to download scanning software to read the Microsoft MS Tags used in the game.

Southeast Corporate takes cap restoration plan on the road

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TALLAHASSEE, Fla. (1/18/11)--Southeast Corporate FCU has scheduled regional meetings to discuss details of its proposed new Business and Capital Restoration Plan. The plan, which was outlined to member/owner credit unions in December, includes key elements of the corporate’s business strategy and methodology for ensuring adequate capital to meet the National Credit Union Administration's (NCUA) Regulation Part 704 requirements. "Southeast Corporate's strength and future depend on credit unions' support, and it is vital to talk with our members about our plans and continuing to meet their financial service needs," said Brad Miller, president/CEO of the $2.5 billion corporate. Although the final plan will need NCUA approval, Miller noted that the town hall meetings will provide an opportunity to go over the business model and capital plans, answer questions and receive input from members at an early stage of the process. “Credit unions created and own Southeast, and their participation is essential to our mutual success,” Miller said. Members can register to attend the meetings at the resource link. The meetings will take place from 1 p.m. to 3 p.m. local time on these dates:
* Jan. 25, Pensacola, Fla., at the Pensacola Civic Center, 201 E. Gregory St. * Jan. 26, Gulfport, Miss., at the Keesler FCU Administration Building, 13083A Seaway Road; * Jan. 27, Jackson Miss., at the Mississippi Credit Union Association, 1400 Lakeover Drive, Suite 200; * Feb. 2, Tallahassee, Fla., Southeast Corporate, 3692 Coolidge Court; * Feb. 3, Jacksonville, Fla., Southeast Corporate, 8400 Baymeadows Way, Suite 18; * Feb. 9, Lakeland, Fla., Publix Employees FCU, 3005 New Tampa Highway; * Feb.10, Miami Lakes, Fla., Don Shula's Hotel, 6842 Main Street.

Technology Mobile is the way to go in 2011

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MADISON, Wis. (1/18/11)--If 2010 will be remembered as the year mobile banking began to go mainstream, 2011 may well be known as the sequel. Credit union technology experts say that mobile banking development will continue to gain acceptance, as smart phone technology becomes more closely integrated into consumers’ everyday lives. And that will have implications for credit unions. This is part 1 of a two-part series on hot technologies for credit unions in 2011. Part 1 focuses exclusively on mobile, which experts agree is the most popular vehicle for delivering information, regardless of the industry. “The smart phone is proliferating,” Rudy Pereira, senior vice president of operations and technology at Alliant CU, Chicago, and chair of the CUNA Technology Council Executive Committee, told News Now. “It’s become preferential.” The key driver of mobile adoption is applications, or apps, as they are better known, small software programs that consumers can download for their iPhones, Androids, or iPads, that perform specific functions to make life easier or more entertaining. In the financial services world, that might include account access, ATM locators, remote deposit or just about any function that can be performed through online banking. “It’s a maturing paradigm,” said Steve Williams, principal of the consulting firm Cornerstone Advisors, Scottsdale, Ariz., and one of the authors of the online newsletter Gonzobanker.com. “It’s not about trying to make the browser work on the phone as much as its focusing on getting the app environment to do anything to serve the member’s needs.” Jim Bruene, the author and publisher of the Online Banking Report and the blog Netbanker, said that at the end of 2009, there were about three dozen mobile applications available from financial institutions. At the end of 2010, that number had increased to about 1,000. “Now virtually every consumer has a financial application they can choose from,” Bruene said. “That will continue to drive adoption.” As the mobile market matures, Williams believes, financial institutions will move toward more hefty mobile applications such as bill payment and loan applications. “I think financial institutions are going to compete on that experience, from bill payment to account opening,” Williams said. “We’re really just getting started on it.” With those capabilities, 2011 will probably be the year credit unions begin to think of mobile as a true part of their retail delivery strategy, Pereira said. “Those that are going to have success are going approach it not as a subset in their delivery strategy but as a completely different channel,” he added Even those credit unions that thought they were ahead of the game in deploying mobile may have to play catch-up to keep up with the fast-changing market. “Those that deployed mobile two years ago are probably going to have to go back and rethink it,” Pereira said. “The market has just started to take off, and that is only going to continue.” Part II will appear later this week.

Maine league meets with CFPBs Warren

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PORTLAND, Maine (1/18/11)--Maine Credit Union League President John Murphy took part in a meeting Wednesday with Elizabeth Warren, the head of the newly formed Consumer Financial Protection Bureau (CFPB), U.S. Sen. Olympia Snowe (R-Maine) and 13 key Maine stakeholders that will be affected by the CFPB. At the meeting in Portland, Maine, Snowe told Murphy that her goal was “to make Ms. Warren readily accessible for an informed discussion with a small group,” said the league’s Weekly Update (Jan. 14).
John Murphy (left), president of the Maine Credit Union League, and Elizabeth Warren (right), head of the newly formed Consumer Financial Protection Bureau, attended a meeting of key Maine stakeholders hosted by U.S. Sen. Olympia Snowe (R-Maine) and Warren Wednesday in Portland, Maine. (Photo provided by WCSH-TV) .
Murphy had an opportunity to discuss some of the issues that Maine credit unions face that will now fall under the jurisdiction of the new bureau when it picks up responsibility for the 18 federal consumer financial protection laws now enforced by seven regulatory agencies. The official transfer date is July 21. Warren told attendees, “We need to make compliance easier for lenders, and this is particularly important for credit unions and community banks.” Murphy said: “I took the opportunity during the meeting to point out that a number of financial institutions that were behind the financial meltdown are now recording record profits, and the smaller financial institutions are now left to deal with a significant increased regulatory burden. “I also mentioned to Ms. Warren how regulatory relief could benefit consumers, and she acknowledged the many confusing regulations, disclosures, etc., that exist today,” he added.

CU System briefs (01/17/2011)

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* NAPERVILLE, Ill. (1/18/11)--The Central Illinois Chapter of Credit Unions held a "meet and greet" breakfast to help credit unions get
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to know Illinois State Rep.-elect Mike Unes (R-91). The event, hosted by CEFCU in Peoria, was the second meet and greet event held by a chapter since nearly 25 new lawmakers were elected into the Illinois General Assembly in November. Since Unes is new to credit unions, the delegation provided him with "a solid foundation on what the Illinois credit union movement is all about," said Charla Buchanan, chapter legislative forum representative. "He was very responsive to our issues." "We look forward to building on this relationship as it pertains to credit union legislative priorities and other concerns related to financial services, said Tory Eckstein, league director for the chapter. From left are: Penni Gebke, league regional director; Eckstein; Unes; Sandy Andrews, chief operating officers, CEFCU; Debbi Bitner, chapter first vice chairman; and Buchanan. (Photo provided by Illinois Credit Union League) … * MADISON, Wis. (1/18/11)--Elizabeth Simonis, 29, of Custer, Wis., pleaded guilty Wednesday in a federal court in Madison, Wis., to embezzling $12,000 from a credit union where she worked in Stephens Point. According to a Department of Justice press release, Simonis ook the amount during 2010 from a member account at Bulls Eye CU. The credit union fully reimbursed the member, said The Capital Times (Jan. 14). Simonis faces up to 30 years in prison. Sentencing has been set for March 31 … * OMAHA, Neb. (1/18/11)--Vincent Gepson, 51, of Omaha, Neb., was sentenced Thursday to nearly 12 years in a federal prison for a string of robberies in Nebraska and Iowa, according to a press release from U.S. Attorney Deborah Gilg of Nebraska. Gepson received six sentences of 140 months each, to be served at the same time and was ordered to pay restitution of more than $24,000. He was arrested in December 2008 in Neosho, Mo. The six robberies occurred between Nov. 13 and Dec. 1 of 2008. They included four banks in Omaha and two credit unions in Council Bluffs, Iowa--United CU on Nov. 18 and Telco Triad CU, Nov. 7 (KGAN CBS 2 News Jan. 14 and MoberlyMonitor.com Dec 7, 2008) … * HARRISBURG, Pa. (1/18/11)--Belco Community CU helped ring in the New Year by welcoming the first baby of 2011 at three local hospitals, reported the Pennsylvania Credit Union Association (Life is a Highway Jan. 14). It partnered with Hanover Hospital, Heart of Lancaster Regional Medical Center, and the Pinnacle Health Maternity Center located in the Harrisburg Hospital. The $323.3 million asset credit union donated a gift basket to the parents of the babies. Baskets included a $50 Visa gift card, baby shampoo and lotion, a stuffed Belco tiger, and various toys and linens. "As a community chartered credit union, Belco values social responsibility and enjoys giving back to those in the communities we serve," said Lonny Maurer, president/CEO …