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CU System briefs (10/03/2011)

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* PERRYSBURG, Ohio (10/4/11)--Students and faculty at the Penta Career Center, Perrysburg, Ohio, joined credit union leaders from Northwest Ohio to introduce an online version of the financial education reality game, Finances 101: "Walk the Walk, Talk the Talk." A $26,000 grant from the Ohio Credit Union Foundation (OCUF) enables students to play the game virtually in classrooms and living rooms across the country. They can learn at their own pace, while diving deeper into the meaning of monthly debt commitments and linking to resources for more information. The game was created by the Northwest Chapter of the Ohio Credit Union League to provide real-world money experiences to high school students. Since 2003, nearly 6,400 students in Ohio have participated in the in-person version of the simulated "game of life." The online version allows users to select a male or female avatar, which is assigned a job based on the user's anticipated education level and career fields of interest, and proceed through real life situations. The grant was used to partner with WGTE Public Media, which provided technological resources to develop the online version and host the site … * DUBUQUE, Iowa (10/4/11)--Dupaco Community CU was named one of the top five mid-size employers in Iowa by the Des Moines Register (Sept. 18) as a result of a free, voluntary employee survey conducted by the newspaper in partnership with Workplace Dynamics to identify the top 25 employers in the state. The same survey also garnered Dupaco President/CEO Bob Hoefer recognition for his leadership. Survey respondents rated the importance of attributes such as feeling appreciated, being paid fairly and being listened to, then rated their employers on each statement. Dupaco had a 94% employee participation rate. Roughly 117 companies participated …

Maine CUs see growth in first-half 2011

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PORTLAND, Maine (10/4/11)--Maine's credit unions experienced across-the-board increases in all key categories including assets, savings, lending and membership for Jan. 1-June 30, according to the Maine Credit Union League's mid-year statistics for the period. Growth was even more significant when compared with the same period in 2010. Credit unions' combined assets in the state rose $5.56 billion or 3% since January. Loan growth was positive--a contrast to many other financial institutions in Maine and in the nation, said the league. Real estate loans rose 5.1%, savings increased by $126 million or 2.7% from the end of the year, and the influx of consumers to credit unions continued with a 0.7% growth or 4,388 new members during the first six months of 2011. Maine credit unions now serve 615,108 members. "As consumers continue to seek value in financial services, especially as economic challenges remain for many Mainers, Maine credit unions are well-positioned to provide value and benefits that consumers seek," said John Murphy, league president. "We expect this trend to continue, as other financial institutions introduce new fees and increase existing ones, and consumers are growing weary of fees," he said. "Meanwhile, Maine credit unions offer products and services without fees, such as no-fee debit cards, free checking at most credit unions, the largest no-fee ATM networks in Maine, a shared branch network with access to nearly 150 locations in Maine and 4,300 nationwide, as well as the sophisticated technology to access and conduct transactions. Many of the state's credit unions have reported hearing from consumers interested in using a credit union as a result of the recent decision by Bank of America, with other banks expected to follow suit, to impose a $5 fee on debit cards, Murphy said. "Maine credit unions are a great deal, and more consumers are discovering that every day." He also attributed growth to record volumes of consumers rushing to take advantage of the low mortgage interest rates and low home prices.

Equifax reports bankcard originations increasing

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ATLANTA (10/4/11)--Total bankcard originations for the first six months of 2011 are up by 27% over the same time in 2010, according to Equifax's latest national Credit Trends Report. More than 18 million bankcards were originated at credit unions and banks during the period--a three-year high for the January through June period. Bankcard originations for subprime borrowers--those having Equifax credit scores of less than 660--continued a trend seen in January-May data, said the credit information bureau. They exhibited a sustained increase--64% over the same period in 2010--and make up more than 31% of all card originations. During the first half of the year, 5.4 million new subprime cards were originated. The increase coincides with hikes in credit limits as well, said Equifax. In January-June 2011 new bankcard credit limits rose 27% over January-June 2010 levels. New subprime credit limits increased 68% for that period. Two other key findings:
* A $45 billion credit increase since February coincides with a decrease in bankcard delinquencies. * The number of bankcard delinquencies is declining to pre-recession levels. However, the average dollar amount of card delinquencies is increasing.
The data "clearly indicate a continuation of increasing numbers of bankcard originations and higher new bankcard credit limits," said Michael Koukounas, Equifax senior vice president, special client services. "While bankcard origination numbers are still far from their pre-recession levels, bankcard delinquency levels have actually declined below pre-recession levels, and I expect a continuation of this trend in the near term."

Natl media intensify reports on CUs debit-fee relief

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MADISON, Wis. (10/4/11)--Credit unions made an impact last weekend and yesterday among national media reporting on consumer backlash from debit card-fee hikes by large banks seeking revenue after limits were imposed on debit interchange by the Dodd-Frank Act . The media--including ABC's "Good Morning America," The New York Times, National Public Radio and Yahoo! Finance--told consumers to consider switching to a credit union.

On ABC's "Good Morning America" Monday, Elisabeth Leamy reported on "Tips and Tricks to Avoid New Bank Fees." News last week about Bank of America's plans to charge $5 per debit card purchase transaction produced "an immediate backlash," with protests from consumers causing the bank's website to crash, Leamy said. She reported that other banks could follow in one of the "unintended consequences" of the debit card interchange provision. Leamy, who is a past guest on the Credit Union National Association's (CUNA's) Home & Family Finance Radio Show, is familiar with credit unions through her work on savings makeover segments that featured credit unions in New York and New Jersey. Among the "workarounds" consumers can use against such fees include considering a credit union. ABC's website, abcnews.com, features a link where viewers can go to find a credit union, she said. Other reports:
* "Marketplace" from National Public Radio (Sept. 30): BofA's fee has "angered consumers who haven't forgotten they helped bail out the bank as taxpayers." However "BofA's nearly 39 million debit card holders do have options: Switch to a smaller bank or credit union, or just start putting all their purchases on a credit card," said the report, entitled "Bank of America to charge for debit card use." * In "Question: Why Pay Bank Fees?" The New York Times columnists Ron Lieber and Ann Carrns reported that Elvita Dominique of Harlem, a BofA customer had met with the bank to go over her options. Interviewed as she was leaving the appointment, she said one option she is considering is joining a credit union. "The fed-up have plenty of places to go to find a better bank these days," wrote Lieber and Carrns, adding readers can use creditunion.coop to locate "a credit union that will take you in." A student at University of Arkansas also indicated she might switch. A debit fee is "an inconvenience, especially for students. No one carries cash." * Yahoo.com noted in its "SmartMoney" article, "Is It Time to Ditch Your Debit Card?" that "for anyone who still really wants a debit card, smaller banks and credit unions may be the best alternative." * CreditCards.com (Oct. 3) in its article, "9 ways to avoid debit card usage fees," advised: Switch banks. "Consumer advocates urge debit cardholders to do their homework and find lenders than don't charge fees. That is most likely going to e a local credit union or small community bank." * In the Denver Business Journal Online (Sept. 29) , Bankrate.com Senior Analyst Greg McBride said not all banks are expected to charge the fees. Many larger banks have added the charges so the impact is larger, but he advised consumers to shop around. "Look at community banks, credit unions and online banks," he said. "They are still very viable for free checking and free debit cards." * In "Bank of America Charges Debit Card Fee: Time to Consider CUs?" International Business Times (Oct. 2) reported that some consumers on BofA's Facebook page commented they would switch to credit unions. BECU, Tukwila, Wash., told Seattle Post-Intelligencer that business at branches is "bustling." The credit union did not tie the increase in business to the bank's fees, but said it has steadily gained members leaving for-profit banks and growing fees. Its membership grew by 18% over the past 12 months. The Credit Union National Association (CUNA) in the article said that credit unions don't issue stock or pay dividends to outside stockholders, so they can offer lower loan rates, higher interest on deposits and lower fees. The article also reported that credit unions' CO-OP Network boasts free access to 29,000 ATMs and provided a link to an ATM online locator. * WTVM-TV in Georgia's "'Fed Up With Fees? Ways to Break Up With Your Bank" featured MEA FCU, which is offering money back for using a debit card. Credit unions "don't nickel and time" members and they don't have fees on debit cards, said the credit union.
These articles joined others reported earlier on Monday, including an interview with CUNA President/CEO Bill Cheney on Fox Business Network in which Cheney told reporter Gerri Willis that the credit union difference makes the financial cooperatives a better deal for consumers than profit-driven banks. Los Angeles Times and The New York Times also reported examples of credit unions as a solution to the debit fees (News Now Oct. 3).

Wis. league honors Maxwell Herring Desjardins winners

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PEWAUKEE, Wis. (10/4/11)--The Wisconsin Credit Union League announced its 2011 state-level winners for the Dora Maxwell, Louise Herring and Desjardins awards. First-place Dora Maxwell Social Responsibility Community Service Award winners are:
* Marinette (Wis.) County Employees CU, $5 million to $20 million in assets; * Badger Globe CU, Neenah, $20 million to $50 million; * Premier Financial CU, New Holstein, $50 million to $100 million; and * Heartland CU, Madison, $100 million to $200 million.
Louise Herring Philosophy-In-Action Member Service Award first-place winners include:
* Winnebago Community CU, Oshkosh, $50 million to $250 million in assets; and * CoVantage CU, Antigo, $250 million to $1 billion.
First-place Desjardins Youth Financial Education Award winners are:
* Central City CU, Marshfield, $150 million to $500 million in assets; and * Altra FCU, Onalaska, more than $500 million.

MnCUN hosts in-districts meeting with lawmakers

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AUSTIN and ST. PAUL, Minn. (10/4/11)--The Minnesota Credit Union Network (MnCUN) held two meet-and-greet events with legislators in late September.
Click to view larger image The Minnesota Credit Union Network (MnCUN) held two in-district meetings with federal legislators in late September. During a meet-and-greet on Sept. 27, U.S. Rep. Tim Walz (D-Minn.) (center) discussed member business lending and other issues with credit union representatives.
The in-district meetings with U.S. Rep. Tim Walz and Sen. Amy Klobuchar, both Democrats, helped credit union representatives to build on the momentum gained during MnCUN’s September Hike the Hill, according to MnCUN. The meet-and-greet series kicked off Sept. 27 when MnCUN and credit union leaders met with Walz at Accentra CU in Austin. Attendees received a brief congressional update from the Walz, who provided insight into the federal budget debate. The conversation also focused on the Small Business Lending Enhancement Act (H.R. 1418 and S. 509), which would increase credit unions’ member business lending (MBL) authority to 27.5% of total assets from the current 12.25%. Emphasizing the importance of increasing the availability of credit, Walz said small businesses are struggling to obtain loans. Credit unions also stressed MBL during a meeting with Klobuchar on Sept. 28 at Affinity Plus FCU in St. Paul. The group highlighted the potential benefits the legislation could have on the Minnesota economy.
Click to view larger image As part of a legislative meeting on Sept. 28, from left, Sen. Amy Klobuchar discussed credit union issues with Kyle Markland, president/CEO of Affinity Plus FCU, St. Paul. (Photo provided by Minnesota Credit Union Network)
In the addition, the discussion focused on the compliance and regulatory burden of the Dodd-Frank Wall Street Reform & Consumer Protection Act. Attendees provided Klobuchar insight into the time and resources credit unions are dedicating to comply with new regulations related to the act. Also, credit union representatives emphasized that despite increased regulations and the potential ramifications of the debit interchange amendment, credit unions remain dedicated to keeping fees low for consumers. The Credit Union National Association and credit unions are pressing Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.

Fumes send seven CU employees to hospital

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SPRING TOWNSHIP, Pa. (10/4/11)--Fumes from a nearby construction project sickened seven employees Friday at a Diamond CU branch in Spring Township, Pa., and led to their being taken to area hospitals. Six of the seven workers were treated in emergency rooms and released. One was still at an area hospital Friday afternoon, but was doing well and was expected to fully recover, said John Faust, president/CEO of the $373.5 million asset, Pottstown, Pa.-based credit union (readingeagle.com Oct. 1). Area firefighters and ambulances were dispatched to the credit union when someone there called police to report a strong odor, the newspaper said. When credit union staff reported feeling nauseous, the building was evacuated and closed for the day, the paper said. Construction workers were using mushroom soil while working on a water retention system at the construction site, Faust told the paper. Soil fumes were drawn into the credit union through the ventilation system, he added.

Hispanic experts to speak at CUNA conference

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DES MOINES, Iowa (10/4/11)--Two representatives from Coopera, an economic development firm focusing on emerging markets for credit unions, will present a breakout session on creating loyalty within the Hispanic marketplace Oct. 26 during the Credit Union National Association’s (CUNA) Community Credit Union and Growth Conference in San Francisco. During the breakout session, “Product Strategies to Attract and Create the Loyalty of the Hispanic Community,” Coopera’s Warren Morrow and Miriam De Dios will address one of the hottest topics in the credit union industry. Young and largely underserved by financial institutions, Hispanic communities nationwide represent an opportunity for credit unions, according to Morrow and De Dios. “The average age of a credit union member is 47 and creeping older each year,” said De Dios, Coopera vice president. “On the other hand, the average age of the Hispanic population is 27. We have also seen that Hispanics use as many products per household as other members. They seek to borrow, they are responsible, they are loyal, and they refer their friends and family. It’s easy to see why Hispanics are appealing for credit unions.” Many credit unions mistakenly believe translating their brochures and websites into Spanish is enough to reach the Hispanic market, according to De Dios and Morrow. In the presentation, the two will outline successful Hispanic outreach strategies and discuss the importance of adapting products to the market instead of expecting that the market will adapt to them. Coopera is majority owned by the Iowa Credit Union League and is a strategic alliance partner of CUNA. The conference will be held Oct. 24 to Oct. 27.

NCUF seeks nominations for three board seats

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MADISON, Wis. (10/4/11)--The National Credit Union Foundation (NCUF) is seeking nominations for three board seats: an open credit union executive or director seat, a system affiliate seat and its at-large seat. Applications are due Oct. 28. Volunteers serve up to three three-year terms on the NCUF board so long as they are re-nominated by the NCUF Governance and Nominations Committee and re-elected by the NCUF board. Qualifications for the positions include:
* Credit union executive or director seat: Candidate must be an executive officer or director of a credit union. * System affiliate seat: Candidate must be and remain a director or executive officer of an organization that is national in scope, has as its primary purpose the support of credit unions or some element of the credit union movement; has a significant portion of ownership or membership from the credit union system; and has demonstrated a commitment to the purposes of this corporation. NCUF cited CUNA Mutual Group as an example. * At-large seat: Candidate must be and remain a representative of an organization outside the credit union system, such as a cooperative, that has demonstrated a commitment to the purposes of the corporation. The individual elected to this seat is appointed for a one to three-year term determined by the NCUF board and shall not be eligible to serve on the foundation's Executive Committee.
Two incumbents in the system affiliate and at-large seats are up for election: Christopher Roe, senior vice president, corporate and legislative affairs, CUNA Mutual Group, Madison, Wis., who is completing his first term; and John Gregoire, president, The ProCon Group, Madison, who is completing his second term. The third position will be vacated by Allan Kemp McMorris, president/CEO of Oakland County CU, Waterford, Mich., who is fulfilling his last term on the board. To apply, use the link. The NCUF board will vote on the committee's recommendations in December. In January, NCUF's board will elect table officers at its organizational meeting, the first of three face-to-face meetings planned for 2012. The meetings are:
* Organizational meeting, Jan. 24, Phoenix; * Spring/Summer meeting, May 17; and * Fall board meeting, September 2012 in Washington, D.C.
The board has 13 voting seats, which include representatives from credit unions, national organizations serving credit unions, corporates, state credit union foundations, state leagues and the at-large position.

IUSA TodayI CU helps low-incomers vs. payday loans

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NEW YORK (10/4/11)--Credit unions are among the options low-income consumers without a financial institution have to avoid the steep cost of payday lenders, according to a Thursday article in USA Today. The article, “Low-income borrowers get options beyond payday loans,” mentioned Micro-Branch, which is a combination check casher and credit union, which was started in California last year to serve unbanked families. The credit union, Self-Help FCU in East San Jose, Calif., launched a Micro Branch for many unbanked Latino families in the area who rely solely on check cashing. Self-Help not only offers less costly check cashing, but also encourages members to begin saving money in a credit union account. To read the article, use the link.

Randolph Brooks gives cash back on debit purchases

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LIVE OAK, Texas (10/4/11)--Unlike megabanks that are hiking debit-card fees, a new program at Randolph-Brooks FCU (RBFCU) in Live Oak, Texas, will give members cash back on debit-card purchases. Until Dec. 31, RBFCU will reward members with 15 cents cash back on every debit card purchase. The credit union currently pays members 10 cents for each transaction, but chose to increase the reward as a member-appreciation program for the end of the year. “We’ve watched other financial institutions put new fees in place and we know that’s not what members need during a time when the economy is struggling,” said Sonya McDonald, senior vice president of market development. “Instead of upping our fees, we chose to increase rewards. Since we’ve experienced record growth this year, we decided to use the extra funds as a thank you to the members who have made this growth possible.” The $4.4 billion asset credit union also plans to reward members who use its MasterCard credit cards with 5% cash back on each fuel purchase. Consumers have objections to Bank of America (BofA) and other large banks raising fees to cover lost revenues caused by the Federal Reserve’s debit card interchange rule (See related News Now story “Nat’l media intensify reports on CUs’ debit-fee relief). It was widely reported Thursday that Bank of America has plans to begin charging a $5 monthly fee to some debit-card users (News Now Sept. 30). The Credit Union National Association (CUNA) is urging the Federal Reserve to increase the amount of per-transaction fees that debit card issuers receive to cover their costs associated with fraud prevention. CUNA also recommended that the Fed periodically revisit the fraud prevention cost issue to see if the costs have changed and whether any future adjustments are necessary. The Fed is required to study and report on how the debit interchange fee cap has impacted merchants, consumers and financial institutions within the next two years (News Now Oct. 3).

Tree Capital CU merges into Fla. State U CU

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TALLAHASSEE, Fla. (10/4/11)--The National Credit Union Administration has approved the merger of $17 million asset Tree Capital CU, Perry, Fla., into Florida State University CU, with $95 million in assets, Tallahassee, Fla.
Click to view larger image Florida State University CU opened its sixth branch on Sept. 10 at 1412 W. Tennessee Street in Tallahassee, Fla. with a ribbon-cutting ceremony. (Photo provided by Florida State University CU)
The merger was effective Saturday. Tree Capital CU members approved the merger by a near unanimous vote on Sept. 26. Full integration of the two operations will take place in the next four to six months. Tree Capital CU will keep its name but become a division of Florida State University CU. Tree Capital staff will continue serving members at its branch in Perry, Fla. Kay Green, Tree Capital CU CEO, will become a member of the Florida State University CU senior management team. Two Tree Capital board members will continue service on a combined board of directors. Florida State University CU opened its sixth branch on Sept. 10 at 1412 W. Tennessee Street in Tallahassee.

Top 10 iNews Nowi stories for September

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MADISON, Wis. (10/4/11)--An article about how members of a credit union’s management team can serve only on one board was the most read News Now story in September. Here is a list of the top 10 most-visited stories for the month. 10. Western Bridge members’ service will be uninterrupted--NCUA ALEXANDRIA, Va. (9/2/11)--United Resources FCU’s bid to succeed Western Bridge Corporate FCU fell short of the bridge corporate’s stated capital subscriptions goal of $200 million Wednesday, said the National Credit Union Administration. 9. Equity ratio, net worth changes passed by NCUA ALEXANDRIA, Va. (9/23/11)--Amendments to the Federal Credit Union Act’s definitions of the National Credit Union Share Insurance Fund’s definitions of equity ratio and credit union net worth were unanimously approved by the National Credit Union Administration board on Thursday. 8. BofA debit fee shows interchange cap a blow to consumers: CUNA WASHINGTON (9/30/11)--As most credit unions continue to offer free debit card services, banks are just beginning to apply sometimes hefty fees to the popular service. It was widely reported Thursday that Bank of America has plans to begin charging a $5 monthly fee to some debit-card users--in an attempt to recoup lost revenues caused by the implementation of a statutory cap on debit interchange fees. 7. USA Today: Fee gap between banks, CUs could widen MADISON, Wis. (9/28/11)--The gap between the historically low rates credit unions offer their members and the higher rates big banks charge their customers could become even wider as a result of the new debit interchange fee cap regulations, according to a Tuesday USA Today article. 6. NCUA OIG: Examiners could have eased Certified FCU losses ALEXANDRIA, Va. (9/12/11)--National Credit Union Administration examiners “could have prevented or reduced” losses to the National Credit Union Share Insurance Fund that were caused when Certified FCU failed in 2010 if “swift and appropriate administrative remedies” had been taken, the NCUA's Office of the Inspector General has determined. 5. NCUA prohibits five from future CU work ALEXANDRIA, Va. (9/15/11)--Five individuals have been the subject of recent prohibition orders issued by the National Credit Union Administration and are thereby prohibited from participating in the affairs of any federally insured financial institution. 4. CUNA addressing IRS CU exemption error WASHINGTON (9/16/11)--An assertion by the U.S. Internal Revenue Service that some credit unions are no longer tax-exempt is “completely wrong” and something that the Credit Union National Association (CUNA) will work on tirelessly to set the record straight, inside and outside the credit union movement, CUNA President/CEO Bill Cheney said Thursday. 3. WSJ: Credit unions a better value than banks MADISON, Wis. (9/20/11)--An article in the Sunday edition of The Wall Street Journal touted credit unions as a more affordable option than banks. 2. Visa, MC expected to raise small-purchase fees NEW YORK (9/27/11)--Visa Inc. and MasterCard Inc. plan to increase the fees merchants pay for small-ticket debit purchases to the full amount allowed under the Federal Reserve's new rules that take effect Oct. 1, said analysts interviewed by Bloomberg News and The Wall Street Journal (Sept. 23) . The move could discourage some merchants from accepting debit cards for small transactions. 1. CU execs must serve only one board, NCUA says ALEXANDRIA, Va. (9/12/11)--The National Credit Union Administration’s (NCUA) management official interlocks rule prohibits members of a credit union’s management team from serving other nonaffiliated depository organizations, NCUA Associate General Counsel Hattie Ulan said in an agency legal opinion.