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CU System briefs (01/18/2013)

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  • PHILADELPHIA (1/18/13)--First Heritage Financial LLC, a Philadelphia based, credit union-owned mortgage services provider, ended 2012 by topping $452 million in closed loan production and $1.2 billion in serviced mortgage loans. The company services 63 partner credit unions with combined assets of more than $6.3 billion and more than 711,00 members throughout Pennsylvania and Delaware, and is endorsed by the Pennsylvania Credit Union Association (Life is a Highway Jan. 16) …
  • HIGHTSTOWN, N.J. (1/18/13)--New Jersey credit unions will host their first Financial Reality Fair for college students on April 2 at New Jersey City University (The Daily Exchange Jan. 16). The program has been adapted to fit the older age group of nontraditional students at the university. The budget worksheets are more customized to students' current monthly expenses, including rent, student loans and dependents. The New Jersey Credit Union League will offer special volunteer training  on March 7 from 10 a.m. to noon ET at the league offices or through video conferencing at Members 1st of NJ FCU, Vineland, and Atlantic FCU, Kenilworth …
  • ALBANY, N.Y. (1/18/13)--New National Credit Union Administration Region 1 Director Larry Blankenberger, right, visited the Credit Union Association of New York offices Wednesday, meeting for the first time with CUANY President/CEO William J. Mellin, right, and other key staff. Blankenberger assumed his new role on Monday. He will manage NCUA's supervision and examination program for federal credit unions in New York, Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. The group discussed NCUA's examination priorities for the year, and CUANY staff shared feedback from a statewide examination survey last year. "As our regulatory environment becomes more and more challenging, working collaboratively with key NCUA leaders is essential," Mellin said. "In the year ahead, we'll continue looking for opportunities to foster dialogue between our member credit unions and our regulators." Blankenberger previously was associate regional director for programs at NCUA's Region IV office and served as associate regional director for operations in Region I. (Photo provided by the Credit Union Association of New York) …
  • MEMPHIS, Tenn. (1/18/13)--Teri Van Frank  has been promoted to president/CEO and chairman of the Share One Inc. Board of Directors. She previously was senior vice president/chief operations officer, overseeing a major portion of the technology company's customer interfacing departments. Van Frank replaces Darryl Tanner, who retired after 15 years as president/CEO. Tanner will remain in a consulting role to senior staff. Van Frank has been with Share One for 31 years. Memphis, Tenn.-based  Share One is a credit union service organization serving 89 credit unions and is a developer of credit union Internet software solutions …
  • MADISON, Wis. (1/18/13)--Steve Koslow, senior vice president, chief ethics and compliance officer for CUNA Mutual Group, has been elected chairman of the board of directors for the Compliance & Ethics Forum for Life Insurers (CEFLI). Koslow has served on the board for a number of years. The board is comprised of chief compliance and ethics officers of CEFLI's member companies and representatives of affiliate membership organizations. Koslow has been with CUNA Mutual since 2007. In his current role he leads teams that design and implement controls necessary to ensure compliance with regulatory market conduct requirements. He also oversees employees who assess compliance risk, monitor compliance work and maintain governance over the company's documented policies, procedures and standards …

Cohenour named president/CEO at Missouri CU Assn

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ST. LOUIS, Mo. (FILED at 12:40 p.m. CT 1/18/13)--Don Cohenour has been appointed president/CEO of the Missouri Credit Union Association, announced MCUA's board of directors today.

Cohenour, who had been named interim president in November, succeeds Mike Beall. Beall left to become president/CEO of the National Cooperative Business Association.

"Don Cohenour is the ideal candidate to continue driving the strategic direction of the organization," said Dennis Pierce, MCUA's board chairman. "Don's knowledge of credit unions combined with the strength of relationships built throughout his tenure will ensure MCUA maintains a strong connection with its membership."

Cohenour is an 18-year veteran of MCUA. He leaves his position as chief membership officer. In that role, he managed field representatives within the state, served as an executive field representative with all member credit unions and provided overall responsibility for credit union relationships. He also was responsible for credit union staff and volunteer development, consulting services, professional development, and all product and service sales in the state.

"I am looking forward to my new role with MCUA and my continued work with credit union advocates throughout the state," said Cohenour. "The initiatives we set in motion make this an exciting time to lead the organization and make the credit unions of Missouri grow."

CUNA closed Monday for holiday, inauguration

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WASHINGTON and MADISON, Wis. (1/18/13)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Monday due to the Martin Luther King Jr. holiday.  Some CUNA staff will attend activities related to Monday's presidential inauguration.

News Now will not publish a Monday edition but will resume regular publication Tuesday.

CUNA economist: 10-year mortgages created by market demand

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MADISON, Wis. (1/18/13)--With interest rates at record lows, more credit unions are offering 10-year mortgages as members become comfortable with shorter terms or seek to refinance existing loans, said a Credit Union National Association economist.

Credit unions are offering 10-year mortgages because of a changing market, said Steve Rick, CUNA senior economist.

"Some members prefer them over the 30-year mortgage, so [credit unions] are meeting the market demand," Rick said.

First Financial FCU, Wall, N.J., has begun offering a 10-year mortgage with rates as low as 2.5% and $599 closing costs.

"Shortening the term of your mortgage makes the single largest difference in the interest you pay, even more than a lower rate," said Alice Stevens, chief operating officer at First Financial FCU.

Greylock FCU, with $1.1 billion in assets, Pittsfield, Mass., offers a 10-year mortgage with an annual percentage rate as low as 3.75%, according to its website.

In September, Amoco FCU, a $589 million asset credit union based in Texas City, Texas, offered a 2.75% interest rate on 10-year mortgages (News Now Sept. 20).

CUNA's Rick noted other reasons credit unions offer 10-year mortgages:

  • Have less interest-rate risk when  rates rise because more principal is amortized each month and therefore reprices at the higher interest rate;
  • Have less credit risk because loan balances are usually smaller and borrowers usually have better ability to repay; and
  • Have less liquidity risk due to the greater amortization of principal each month.
"A 10-year mortgage will have more interest rate risk compared to a four-year car loan or an adjustable rate credit card loan," Rick said. "But it will have less credit risk because of the secured nature of the loan."

It's about trust: CUs beat national average in benefits survey

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MADISON, Wis. (1/18/13)--Employees ranked credit unions as the most trusted source to help them grow and protect their money, in a national survey.

Eighty-one percent of employees said credit unions were a trustworthy source to help them safeguard their funds, according to the "Sharpening the Focus on Benefits Strategy," the first in a series of research briefs stemming from Prudential's "The Seventh Annual Study of Employee Benefits: Today & Beyond. Comparatively, 79% of employees saw their employers as a trustworthy source for growing and protecting their money.

Fourteen percent of both employers and employees cited severe negative economic effects, a decrease from 2010 results of 27% for employers and 22% for employees. Employers who said their financial position will be better or improving in one year dropped to 54% this year from 70% in 2010; employees report a drop to 38% from 44%.

Employers reported a 17% increase over 2010 results in making benefits strategies a main focus. With shifting ownership and cost of benefits to employees, employers' top strategies included:

  • Expanding wellness, preventive, and work/life balance initiatives;
  • Improving the effectiveness of benefits communications;    
  • Cost-sharing with employees;
  • Giving more financial responsibility to employees; and
  • Increasing employee benefits education and financial advice.
To read another article about consumer trust in credit unions, use the link.

Diamond Award winner boosts loans with new ads

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MUSCLE SHOALS, Ala. (1/18/13)--Listerhill CU in Muscle Shoals, Ala., ran a six-month campaign in 2012 called So Can You to promote lending to its members and to capitalize on previous momentum in loan growth.

Listerhill garnered nearly $105 million in new loans, which was 5.7% beyond its goal of $99.3 million and 15% more than the total of its previous campaign.

That momentum came in 2011, when the $602 million asset credit union's Just Move It promotion that added $91 million in loans--1.32% above its $90 million goal. The promotion garnered Listerhill a Diamond Award-winning Best of Show Award from the CUNA Marketing & Business Development Council.

"Our goal for 2012 was to make sure we capitalized on the momentum we had from Just Move It," said Kristen Mashburn, Listerhill marketing director. "Our campaign had to become even more strategic than last year's promotion."

Listerhill began planning the So You Can campaign just days after Just Move it concluded, Mashburn said. Its marketing team brought together a cross-sectional panel of personnel from its branches and main office. "We wanted to make sure we solicited accurate feedback on what went well with Just Move It, as well as what we could improve upon with the new campaign," Mashburn explained.

Listerhill ran its So You Can campaign from April through September to capitalize on warmer weather and members' increased propensity to borrow during that period, Mashburn said.  Just Move It ran between July and December 2011.

In Just Move It, "our members loved the cash giveback they received from moving their loans," Mashburn said. "We decided to keep that component as well as add a referral system that provided even more cash rewards by incentivizing members to refer other members for new loans."

To help emphasize the relationship aspect of the program, Listerhill decided to feature members who saved on their loans through lower rates through the So You Can campaign.

To view the two television advertising pieces, use the links.

Detroit Free Press reports CUs' low auto loan rates

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DETROIT (1/18/13)--Credit unions nationwide are offering low auto-loan rates, the Detroit Free Press reported Thursday. 

Interest rates on new- and used-car loans are hovering around 3% at credit unions and banks. Greg McBride, senior financial analyst at bankrate.com, told the Free Press his company has never seen such low rates.

DFCU Financial CU, based in Dearborn, Mich., with about $3.3 billion assets, is offering 3.49% for 49 months when the car payment is automatically deducted from a DFCU checking or savings account, the paper said. Also, the credit union makes a special dividend payout each year that would lower the effective interest rate.

The paper also mentioned that Communicating Arts CU in Detroit received an initial federal grant of $1.5 million in November 2011 to help bail out consumers with very high car-loan interest rates. 

Those funds came from the U.S. Treasury Department's Community Development Financial Institutions Fund (News Now Aug. 10). "The 2011 funds allowed us to refinance predatory car loans for about 100 people, saving them an average of $80 per month," CEO Hank Hubbard said in August. "That's a total savings for the group of over $400,000 through the life of the loans." As members pay the loans back, the credit union can lend the money out again, he said.

With the program, the $34.3 million asset Communicating Arts conducted 34 auto bailouts in which the original car loan rates exceeded 19%--with one member refinancing an auto-loan rate down to 3.25% from 25%, said the Free Press

Often car shoppers don't realize they have financing alternatives, Hubbard told the paper. Some old loans may have been made years ago during the credit crunch following the financial crisis, he added.

Three elected to PCUA board

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HARRISBURG, Pa. (1/18/13)--Three Pennsylvania Credit Union Association board of directors have been elected by acclamation.

The PCUA Nominating Committee received one qualified nominee for each election category (Life is a Highway Jan. 15).

Association Chairman Michael Kaczenski announced the winners:

  • Cookie Yoder, president/CEO, City Co FCU, Pittsburgh--$30 million or fewer assets;
  • Christine Woods, president/CEO, Keystone FCU, West Chester--$30 million to $100 million; and
  • Rick Stipa, president/CEO, TruMark Financial CU, Trevose--more than $100 million.