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CU System Archive

CU System

Alco FCU employee hurt while foiling robbery

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WELLSVILLE, N.Y. (10/13/09)--A credit union employee was hurt while foiling an attempted robbery in Wellsville, N.Y. The robbery took place at Alco CU on Oct. 7. The employee was injured after struggling with the would-be robber, who was carrying a pellet handgun. The gun broke in half, and the employee was cut. She was treated with stitches at a local hospital and released (Olean Times Herald Oct. 9). A suspect--Michael R. Lamb, 21--was apprehended by police and charged with attempted robbery, second-degree assault and third-degree aggravated unlicensed operation of a motor vehicle. A 17-year-old female who was a passenger in Lamb’s vehicle also was arrested and charged with attempted robbery. Alco CU has $15.6 million in assets.

ISubprime BloggerI suggests going to CUs

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MADISON, Wis. (10/13/09)--Consumers who are seeking personal loans should check out credit unions, said Subprime Blogger in a Sunday post. “If you currently use a credit union, you know there are a few benefits over a national or regional bank,” the blog said. “You also want these benefits during the loan process.” Obtaining a bad personal loan can “lead to a very high interest rate,” said the blog. Even if a consumer has bad credit, “there are many ... credit unions out there that are more than willing to help you get a personal loan,” the blog added.

WOCCU Not every nation ready for accounting changes

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MADISON, Wis. (10/13/09)--Financial regulators and corporations worldwide are moving closer to accepting--even demanding--a uniform set of international accounting standards with which financial institutions in all countries must comply. However, not all countries, including the U.S., have yet required their institutions to rise to the global regulatory challenge, said the World Council of Credit Unions (WOCCU). That inconsistency was revealed during an International Financial Reporting Standards (IFRS) webinar hosted Oct. 8 by WOCCU. The 90-minute broadcast from WOCCU's Madison office included financial experts in the U.S., Canada and Macedonia. The latter two were connected remotely. Participants from 12 countries logged on for the discussion. Demand for the topic emerged from WOCCU member countries, many of which are already in the process of transitioning to international standards, said Dave Grace, WOCCU vice president of association services. The complex demands of the process prompted WOCCU to address the topic in the webinar. “More than 100 countries are actively moving towards international standards,” Grace said. “We have a tremendous opportunity to learn from credit union systems already at the forefront of the transition. We don't want other credit unions and their regulators to have to make this journey on their own.” Participants heard from Holly Skaife, an associate professor of accounting at the University of Wisconsin-Madison, who serves on the Standards Advisory Council of the International Accounting Standards Board; Gary Rogers, vice president of financial policy for Credit Union Central of Canada (CUCC), a WOCCU member organization; and Eleonora Zgonjanin, CEO of FULM Savings House, WOCCU's member in Macedonia. Institutions in each country have found themselves at different stages of the process, and all presenters shared their experiences. “The U.S. is the largest country that has not yet embraced IFRS and still favors generally accepted accounting principles (GAAP),” said Skaife. For many U.S. regulators, GAAP’s rules-based methodology is more stringent and demanding than IFRS standards, which are more principles-based and rely on faithfulness of the representation of financial data. The country's eventual migration to IFRS, while likely inevitable, still may be three to four years away, she explained. In Canada, the process already is underway for most credit unions, which will be required to comply with IFRS standards in reporting their financial data for all fiscal years beginning Jan. 1, 2011, according to CUCC’s Rogers. This will require more judgment and more disclosure by institutions, which will be facing less rules-based guidance, he added. “This is far more than an accounting exercise,” Rogers said. “Canadian credit unions are facing a creeping crisis of complexity, and our obligation is to provide credit unions with the right tools so that, together with their auditors, they are able to ready themselves for the change.” For Macedonia’s single credit union, the process is already complete, said Zgonjanin. The credit union CEO emphasized the need for adequate time and resources. She suggested setting aside a minimum of 12 months for the transition process, including six months for development of the proper policies and procedures in order to keep the process on track. “The transition to international accounting standards is not possible to complete manually, with fewer than three employees, in less than six months and without external assistance,” Zgonjanin said. To view the webinar, use the link.

CEOs at two troubled CUs replaced

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LAS VEGAS (10/13/09)--The CEOs at two credit unions in Las Vegas have been replaced, according to local media reports. Andy Baumann, former National Credit Union Administration (NCUA) supervisor, has been named as interim CEO for WestStar CU. The institution is known as the “Gaming Employees’ Credit Union” and has $174 million in assets (The Las Vegas Review-Journal Oct. 10). Baumann replaces Dan Paulson, former Nevada Credit Union League chairman. WestStar lost $3.5 million in the first half of its year. Its net worth is 10%, which is considered well-capitalized by NCUA standards. Paul Simons, CEO of Rantoul, Ill.-based Credit Union 1, will serve as CEO at Cumorah CU, which serves members of The Church of Jesus Christ of Latter-day Saints. The credit union has $157 million in assets. Simons replaces Tony Mook, who resigned Oct. 5. Cumorah’s financial reports indicate the credit union lost $7.3 million during the first half of 2009. Its net worth is 3.4%, which is below NCUA’s threshold to be considered a well-capitalized institution.

Suze Orman Switch cards to CUs

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NEW YORK (10/13/09)--Consumers with credit cards might want to think about doing a balance transfer to a credit union, personal finance expert Suze Orman said on MSNBC’s “Morning Joe” program Friday. “Credit unions are being more responsible to their [members] than banks,” Orman said. During the show, Orman discussed the limited availability of credit plaguing consumers and said many large banks are raising their interest rates on customers who have consistently have paid their bills. She also noted the case of a Bank of America customer who experienced an increase in interest rates on her credit card balance despite paying all of her bills on time. The woman contacted Bank of America about the rate hike, but the bank refused to help her. She then posted a video on YouTube proclaiming that she would no longer make her payments. Bank of America eventually contacted her to mitigate the interest rate (News Now Sept. 25). To view the video, use the link.

CU System briefs (10/12/2009)

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* SPRING, Texas (10/13/09)--A former intern at Investex CU's Spring, Texas, branch was sentenced Friday to more than 13 years in prison for helping shotgun-wielding men rob the credit union twice within three months last year. Dorcell Devon Johnson, 19, pleaded guilty to aggravated bank robbery and aiding the brandishing of a firearm during a robbery. In November 2008, the credit union was robbed of $202,250. In August of 2008, robbers took $126,750 during a heist in which they pretended to take Johnson hostage. Police became suspicious when he appeared unafraid on surveillance tapes of the earlier robbery. Co-defendants Dominique Sherrard Ervin, 20, and Carl Edward Preston Jr., 19, both of Houston, also pleaded guilty. Preston was sentenced to about 13 years in prison while Ervin was sentenced to 16 1/2 years (Houston Chronicle) … * YAKIMA, Wash. (10/13/09)--The Washington Credit Union League has named Paula Slaye chairman of the Washington Credit Union Foundation. Slaye is chief financial officer of Catholic CU in Yakima. Slaye has served on the foundation’s board of trustees for the past seven years in several positions, including treasurer, grants committee chairman and vice chairman (Yakima Herald Republic Oct. 12) … * St. Louis (10/13/09)-- More than a dozen Missouri credit union representatives met with State Rep. Jake Zimmerman (D-83) at St. Louis Community CU Oct. 7, according to the Missouri Credit Union Association (The Missouri difference Oct. 9). He discussed matters that affect credit unions and their members, and highlighted the primary advantage credit unions have over other financial institutions. "Credit unions benefit from serving their members," Zimmerman said. "When you can actually deliver credit union members into a legislative office, that's when you get the point across--with human beings." When St. Louis Community CU President Patrick Adams asked why Zimmerman supports credit unions, Zimmerman responded that credit unions look out for the little guy, just like he does. Pictured are, from left, Adams, Zimmerman, and Mike O'Brien, St. Louis Community CU senior vice president and chief marketing officer. (Photo provided by the Missouri Credit Union Association) …

SandP commends NCUA addressing liquidity capital

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WASHINGTON (10/13/09)--Standard & Poor’s (S&P) Ratings Service recognized a fundamental shift in the landscape for corporate credit unions when it downgraded six corporate credit unions in April, and withdrew the ratings on two others, S&P said in a press release Friday. S&P said it believes that the National Credit Union Administration’s (NCUA) efforts to preserve confidence in the credit union system have stemmed a liquidity crunch that could have been precipitated by significant outflows from the corporate system. However, the release also highlights that the agency has not yet addressed some of the structural aspects of the system that are likely to evolve, and that could significantly alter the current framework. “Therefore, we believe that stand-alone evaluations of the corporate credit unions are in flux and will need to be re-evaluated in the context of the changing landscape,” S&P said. “Events of the past 18 months may shake members’ faith in the cooperative nature of the system, which had been a major factor supporting the corporates' creditworthiness,” S&P added. “Specifically, the burden of premium assessments on the members may appear too great when compared to the benefits of membership. Ultimately, we believe that the system will need capital to offset the increasingly likely losses stemming from mortgage-related structured securities.” “We believe that the NCUA has been proactive in addressing the needs of the system,” S&P continued. “The NCUA’s actions to assist corporate credit unions amidst a precarious environment include establishing the Temporary Corporate Credit Union Liquidity Guarantee Program, which guarantees participating corporates' debt, and establishing the Temporary Corporate Credit Union Stabilization Fund (TCCUSF) whose primary purpose is to absorb losses stemming from mortgage-backed securities investments in the corporate credit union system during a seven-year period. The TCCUSF is a $6 billion revolving facility provided by the Treasury. “We believe that the NCUA has the mandate, the authority, and the capacity to continue to address the liquidity and capital needs of the credit union system, which is a major factor supporting our current ratings,” S&P concluded. The S&P release helps to underscore the importance of NCUA’s review of the corporate system,” Mary Dunn, senior vice president and deputy general counsel for the Credit Union National Association (CUNA), told News Now. “While S&P notes that it downgraded six corporate credit unions and withdrew the ratings on two others earlier this year, it commends NCUA for acting to ‘preserve confidence’ in the credit union system, including addressing problems within the corporates. At the same time, S&P notes that NCUA has not yet addressed structural issues and indicates the corporates will need more capital,” Dunn said. “No one that I am aware of is disagreeing with that,” Dunn added. “NCUA is planning to address those structural issues, including capital standards, in the proposed corporate credit union rule that it is set to issue for comments in November. CUNA agrees with S&P that NCUA has the authority to address the liquidity and capital needs of the credit union system.”

CU marketer pens Motherhood is the New MBA

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SEATTLE (10/13/09)--A credit union marketing officer in Seattle is on a nationwide tour, promoting her new book about management, "MOTHERHOOD IS THE NEW MBA: Using Your Parenting Skills to be a Better Boss." Shari Storm is vice president and chief marketing officer at Seattle-based Verity CU, where she has worked more than 10 years. She has a master's in business administration. She launched her book, published by St. Martin's Press, on Sept. 29 to some very good press, according to the Washington Credit Union League. "So far it's been featured in Body and Soul, Hybrid Mom and Coscto Connection Magazines, as well as Warner Bros.' MomLogic website and Business Week online," said David Bennett, director of public relations at the league. The book also was featured on Martha Stewart's radio show Thursday and in the Metro News in New York. In the book, Storm offers advice to the working mom on how to be a better boss and relates management to motherhood. Each chapter takes a basic parenting rule and demonstrates how that advice can translate to successful management at the office. For example:
* Speak Their Language: Study what types of communication work best with your co-workers and engage them on those terms. * Never Underestimate the Power of "Kiss It, Make It Better": If your employee needs your support, don't put it off and don't be afraid. If employees are worth keeping, they are worth going to bat for. That is your responsibility as their boss. * Hold the Line on Tantrums: Watch out for signs of your staff looking overworked or bored, and if someone does let loose, take that person aside and address the situation. * Be the Good Mom: Do not be afraid to be caring, nurturing, friendly and casual with your employees. You can be a good person to them without trying to be their best friend.
Storm's October and November tour will take to her Olympia, Wash.; Madison, Wis.; Cleveland, Ohio; and Brooklyn, N.Y. For more information, use the resource link.