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Missouri foundation helps teachers provide fin ed

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ST. LOUIS, Mo. (1/28/11)--Missouri teachers will be able to more easily access personal finance resources and materials for students online, thanks to a grant from the Missouri Credit Union Charitable Foundation (MCUCF). The $5,000 grant will help the Missouri Council on Economic Education (MCEE) convert its resource library electronically. "Improving consumers' personal finance is a primary philosophy of Missouri credit unions," said Mike Beall, Missouri Credit Union Association president/CEO. Beall, who also serves on the MCEE Board of Trustees, noted that the grant will "help cultivate knowledgeable, young consumers." MCEE is a non-profit organization that provides teachers with personal finance resources and materials for classroom use. The new online system will offer teachers an updated curriculum guide, recommended lessons for tracking competency, customizable charts and graphs, and more. The system is expected to be operational by July, and will be revealed at the Missouri Association for Career and Technical Education summer conference in Springfield. MCUCF is funded with contributions from Missouri credit unions.

CU System briefs (01/27/2011)

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* WASHINGTON and MADISON, Wis. (1/28/11)--This is the official legal notice to all members of the Credit Union National Association's (CUNA) 77th Annual General Meeting (AGM), scheduled for Monday, Feb. 28, 2011, at 10:30 a.m. at the Washington Convention Center in Washington, D.C. It will be held in conjunction with the CUNA Governmental Affairs Conference. The AGM will update member credit unions and leagues on the actions of their association over the past year … * RAHWAY, N.J. (1/28/11)--Merck Employees FCU's board voted to pledge its 2011 dues rebate from the New Jersey Credit Union League to the league's financial literacy partnership with the New Jersey Coalition for Financial Education, says the league (The Daily Exchange Jan. 26). The league announced last week a one-time 10% rebate for 2011. Credit unions are given the option to pledge their rebate to the league's Advertising Cooperative. Since Merck already supports the ad co-op, it decided to earmark its funds for financial literacy. "Merck Employees FCU has always been focused on giving back to our members, and we believe financial literacy is part of that. Anything we can do to support the collective effort of New Jersey's credit unions helps all credit union members," said Herman Johnson, board chairman of the $1.5 billion Rahway-based credit union …

ICU TimesI parent co. files for Ch.11 bankruptcy

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NEW YORK (1/28/11)--Summit Business Media, the parent company of trade newspaper Credit Union Times and 12 other business-to-business publications, announced Wednesday it was filing for a Chapter 11 reorganization in a U.S. Bankruptcy Court in Wilmington, Del. The plan has approval from 83% of its creditors and will cut outstanding debts by more than half, or roughly $135 million, which will "enhance the company's financial position," said Summit in a press release Wednesday. It expects to emerge from the restructuring during the first half of this year. The plan provides for Summit's continued normal operations during the reorganization. Subject to court approval, Summit will use its more than $10 million in cash and cash flow from its operations to meet its working capital needs during reorganization. The company said its pre-filing advertising, subscription and event contracts "will be honored in full. Summit will pay all vendors for goods and services received during the reorganization process, and Summit employees will receive uninterrupted wages and benefits." Also, its lenders agreed to provide a debtor-in-possession credit facility of $5 million to support its additional working capital needs, if any, during the process. Andrew L. Goodenough, president/CEO of Summit, noted Summit is "fundamentally sound and profitable" and "well-positioned to take advantage of economic growth coming out of this unusually deep downturn as the industries we serve rebound." Although Summit has "emerged from the downturn as a smaller but healthier company, we have too much debt to support our current business operations, left over from when Summit was a larger, acquisition-oriented company," he said. "We view this reorganization process as the last step in a two-year strategic refocusing of Summit on our core markets." Many publications' revenue come from subscription and advertising sales. Ad sales in particular took a hit for most publications during the financial downturn. Summit Business Media's 13 publications had a total of 4,109.84 ad pages from January through September in 2010--down 7.61% from 2009's 4,525.81 pages. Credit Union Times' ads were down 24.45%, the second highest drop after Senior Marketing Advisor's 33.4% decline in ad pages, according to boxscores from IMS/The Auditor data. News Now contacted Credit Union Times for a statement about the impact of the reorganization and was referred to Summit's press release.

CU CEO named to Fed Cleveland Council

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COLUMBUS, Ohio (1/28/11)--Gary Soukenik, CEO of Seven Seventeen CU, Warren, Ohio, has been chosen to join the Federal Reserve Bank of Cleveland’s district council to represent the Fourth Federal District. The board of governors of the Federal Reserve System has created a national Community Depository Institutions Advisory Council to broaden the scope of input on economic credit conditions. To complement the national effort with regional perspectives, each Federal Reserve Bank is establishing a District Council comprised of representatives from community banks, thrifts and credit unions. “Gary will do an outstanding job representing credit union and providing perspective on the economic and credit conditions facing all financial institutions and consumers,” said Paul Mercer, president of the Ohio Credit Union League.

Canadian merger with three CUs called off

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MADISON, Wis. (1/28/11)--A proposal to merge three credit unions in the Canadian province of Saskatchewan into one province-wide credit union has been scuttled because members failed to approve the merger in a vote Wednesday. The opportunity to merge Conexus, Innovation and Synergy credit unions was missed because all three credit unions require 75% approval of their membership to pass the merger. When the votes were counted, they were sufficient at Conexus (95%) and Innovation (76%), but came up short at Synergy (60%) (Newstalk980.com Jan. 27). “Obviously we’re disappointed,” Synergy board president Wayne White, told the news outlet. “It was the right move to position us for the future.” A merger of the three credit unions would have created a new entity comprising 84 branches, 194,000 members and $7 billion in assets (The Canadian Press Nov. 23). “We did due diligence for the merger and there aren’t any negatives that I can see. It’s just a way for our credit union to grow and prosper into the future,” Gord Lightfoot, board president of Innovation CU, said after a Nov. 23 meeting. “And through the credit union doing well, our members will be better served, and I just see it as an entirely positive thing for our community” (The Southwest Booster Nov. 24).

Ohio appoints new regulator CU council member

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COLUMBUS, Ohio (1/28/11)--The Ohio Division of Financial Institutions appointed a new regulator, and also appointed a credit union CEO to the state’s Credit Union Council. The Ohio Division of Financial Institutions selected Charles Dolezal to take over as superintendent this week from Carolyn Bradford, who departed last Friday. Dolezal, who was appointed by Ohio Gov. John Kasich, will oversee state-chartered credit unions, banks, savings and loans/savings banks, and consumer finance and money transmitters (eLumination Newsletter Jan. 26). A letter of congratulations from Ohio Credit Union League President Paul Mercer was sent Monday to Dolezal, and league staff is trying to schedule an introductory meeting to get the new superintendent in front of credit unions. Former Ohio Gov. Ted Strickland appointed Greg Kidwell, CEO of Members First CU in Columbus, to the state’s Credit Union Council to serve a three-year term, the league said. The council is part of the Ohio Division of Financial Institutions and is made up of seven members who provide advice and recommendations on issues of importance to credit unions to the regulatory agency and governor. Chaired by the Deputy Superintendent for Credit Unions, the council meets quarterly. Rita Haynes of Faith Community United CU, Cleveland; Vidya Iyengar of Marion (Ohio) Community CU; Gary Soukenik of Seven Seventeen CU, Warren, Ohio; Matthew Studer of Toledo (Ohio) Postal ECU; and Robin Thomas of Taleris CU, Cleveland, also serve on the council.

Uzbekistan CUs adopt new development strategy

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MADISON, Wis. (1/28/11)--The Credit Union Association (CUA) of Uzbekistan adopted a new development strategy for 2011 Saturday at its annual general meeting. The new strategy is mostly based on the requirements and tasks set out in an Uzbekistan President’s Resolution of Nov. 26, said Nizomiddin Muradov, CEO of World Council of Credit Union’s (WOCCU) member organization in Uzbekistan. CUA is member of WOCCU and a fast-growing system, said Dave Grace, WOCCU vice president of association services. It was started as a WOCCU development program and today serves more than 150,000 citizens. “This is a success story for WOCCU and exactly what we like to see,” Grace said in August, when 12 members of the Central Bank the Republic of Uzbekistan arrived at WOCCU’s Madison headquarters to explore best practices and strategies. “Despite being only an eight-year-old movement, Uzbekistan’s credit unions have excellent capital, very little delinquency and an extremely strong structure. They’re helping bring a solid middle-class tier to the country’s economy” (woccu.org/newsroom Aug. 25). In regard to credit unions, the resolution outlines significant roles of credit unions to be played along with other nonbanking financial institutions in the country’s financial sector from 2011 to 2015. The resolution describes how priorities should be given to:
* Maintaining stability and effectiveness of their activities in accordance with international norms and standards; * Expanding scope of products and services provided by credit unions; and * Institutionalizing the financial market infrastructure.
The resolution also stipulates the necessity to improve regulatory and supervisory functions over the performance of nonbanking credit organizations--including credit unions--by developing and introducing obligatory economic measures and norms. Together with the Uzbekistan Central Bank and other organizations and agencies, CUA will be involved in:
* Reviewing the law on credit unions and making appropriate changes to improve credit unions’ activities and supervisory functions; * Developing a national rating system for evaluating credit unions; * Reviewing and improving interest-rate policy used by credit unions and microcredit organizations that should increase availability of services offered, and maintaining adequate rates of return; * Developing the Central Bank’s regulations: on corporate governance in credit unions, on basic requirements of operational policies and procedures for credit unions, on requirements of liquidity management, on proper management of loan portfolio by credit unions, on classification of assets by risks in credit unions, on defining and determining criteria for unsound and unsafe activities of credit unions, and on external auditing requirements; * Improving accounting and financial reporting in credit unions; and * Developing and improving the inspection procedures and methods of analysis of credit unions’ activities.

Person-to-person payments gaining steam in CUs

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MADISON, Wis (1/28/11)--Consumers appear willing to embrace person-to-person payments (P2P), but the market still needs a nudge, probably in the form of educational and marketing efforts, said representatives from credit unions who have tested the P2P waters. “It is coming,” said Donna Bland, president/CEO of The Golden 1 CU, Sacramento, Calif. “People don’t carry cash anymore. They carry debit cards. But they can’t make payments to friends with a debit card. This is the alternative.” The Golden 1, a $7 billion asset credit union, has been offering P2P payments since last summer. The credit union uses the ZashPay P2P system from FiServ. Members are automatically enrolled when they sign up for online bill payments. Senders enter the recipients’ e-mail address or mobile phone number to forward payment. Bland said P2P is “picking up steam” with her membership. She said the biggest obstacle to wide-scale adoption is a lack of understanding on how the system works. Most consumers don’t understand it yet,” Bland said. “They ask, ‘How do I send money though an e-mail?” P2P payments were an instant success at $9 billion BECU in Tukwila, Wash.--roughly 4,000 members signed up in the first month the credit union offered P2P payments last spring and BECU now processes $8 million in payments a month. Howie Wu, vice president of virtual banking at BECU, agrees with Bland that the mainstream marketplace needs to become familiar with the logistics of P2P payments. “I think general public is ready for this once they learn about it,” Wu said. “There’s a learning curve to any new technology. From my standpoint if you educate the member on it, promote the product, and they give it a try, they’re hooked.” Wu said BECU call center and branch staff are trained to help members get started with P2P payments. BECU employs Popmoney from CashEdge for its P2P payments. Members who use P2P find creative ways make payments more convenient. For example, Wu said making payments to day-care providers via P2P is popular among BECU members. “Daycare providers love it,” Wu said. “Dealing with [automated clearinghouse] is a lot cleaner than managing cash or check on a monthly basis.” Anthony Vitale, vice president of information technology at Patelco CU, San Francisco, said his members also use P2P to expand their payment options. The average P2P payment at Patelco, which also employs Popmoney, is about $550. Vitale said members are using P2P to pay rent. P2P payments use the ACH system; most bill pay systems still complete their payments by check, Vitale said. The market would be more likely to reach a tipping point with a marketing push from a big national financial institution, like Chase or Bank of America, Vitale believes. Like Wu, Vitale said the general public has yet to learn about P2P payments. He estimates between 300 and 500 financial institutions offer P2P. Among the financial institutions that do offer P2P payments, The Golden 1’s Bland said the key is getting members to try it once. “That’s why education is the real key. If they try it once, they realize how simple and convenient it is,” she added.

Chicago CDCU launches venture with community center

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NAPERVILLE, Ill. (1/28/11)--The North Side Community FCU (NSCFCU) Monday kicked off a new joint venture with the Howard Area Community Center (HACC) to add affordable banking to the list of social services available to the residents of Rogers Park, a low-income neighborhood on Chicago's far North side.
Click to view larger image Helping kick off North Side Community FCU's joint venture with Chicago's Howard Area Community Center are, from left: Shannon Callahan, director, Howard Area Employment Resource Center; Illinois State Sen. Heather Steans (D-7); and Jennifer Sierecki, manager of North Side Community FCU. (Photo provided by the Illinois Credit Union League)
More than 30 individuals, including representatives from the credit union's select employee groups (SEGs), community leaders, Illinois State Sen. Heather Steans (D-7) and the Illinois Credit Union League, attended the launch luncheon. The credit union's satellite banking branch opened for operation Thursday in a back office of HACC's employment resource center. It will be open every Thursday from 11 a.m. to 1 p.m. CT. The credit union has a long-standing relationship with the HACC, one of its SEGs, and as a financial partner to its Volunteer Income Tax Assistance (VITA) site for the past three years. Rogers Park contains pockets of severe poverty, with more than 21% of all households reporting annual incomes of less than $15,000. Many adults there have low educational achievement and need job skills. The low-income-designated, $10 million asset credit union offers services such as pre-paid debit cards, low-cost checking and savings accounts, and financial education, including homeownership education, credit counseling and budgeting assistance. It also offers a Payday Alternative Loan (PAC), which has saved its members more than $5 million since 2002, with 5,600 loans totaling $2.8 million. HACC operates a network of programs that respond to short- and long-term issues of poverty at several neighborhood sites. It helps adults acquire academic, employability, and life skills needed for self-sufficiency. NSCFCU CEO Jennifer Sierecki pointed out that each organization's programs will complement each other. "We will begin to offer financial classes on site in order to make it easier for participants in HACC's training and classes to take advantage of our products and services," she said. "In addition, as community members actively take part in citizenship classes within HACC's English as a Second Language program, the credit union's New American Loan product will become a resource once an individual is eligible and ready to pay for the cost of citizenship," Sierecki said, adding the partnership is "a win-win for both organizations."