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Does your brand offer what members want--Survey

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NEW YORK (11/2/09)--Consumers want to stay informed, and credit unions who want to make the most of their brand should keep that in mind, according to new research on actions that brands can take that are most relevant for Internet users. The "Global Web Index" from Lightspeed Research, a Princeton, N.J., company that provides research in communications services, indicates that the top characteristic U.S. consumers want from a brand is to improve their knowledge. The least desirable characteristic: having your brand "only be visible in store" (eMarketer Oct. 27). That fits in well with most credit unions' philosophies and their efforts to educate members and others about financial issues and money management. Helping consumers keep up to date on topics important to them was also key, followed by being entertaining, becoming part of a daily routine, and informing consumers about the product/service and the credit union or company. Consumers were not interested in brands that tried to act like their friends, Lightspeed said. So what can a credit union do that will enhance its brand with the online consumer? The top action was to offer discounts--especially in today's economy. That was followed by "provide me with relevant news and analysis," "provide me with new ideas and thinking," "create useful online applications that provide a benefit," and "provide free downloads to content that I like." These topped various social and creative efforts such as online communities and brand-created video or TV programs. Word of mouth was the No. 1 purchase driver among the consumers surveyed, with face-to-face recommendations having significantly more weight with respondents than TV ads, advice from online friends, e-mails or websites. The most trusted source of brand information is no surprise: family, then a close friend, and then an expert in the field. The last source is especially important for credit union brands. They can use staff expertise in the personal finance field. These beat out social networking, neighbors, blog authors, store assistances and journalists. Even lower on the trusted source totem pole were a TV-news reader, a radio presenter, and microblogs such as Twitter. Well-known people--such as a CEO of a well-known company, a presenter on a popular TV show, a country's leader/politicians, and well-known celebrities--were at the bottom of the trusted sources list.

U.S. Central posts 3Q results

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LENEXA, Kan. (11/2/09)--U.S. Central FCU Friday posted its financial report for the third quarter ending Sept. 30 on its website, recording a net loss of $308.5 million for the quarter. The loss is the result of other-than-temporary impairment (OTTI) charges, which totaled $320.1 million for the quarter. That compares with a net income of $16.3 million for the same period in 2008. Year-to-date through September, net losses totaled $1.3 billion, compared with net income of $45.9 million for the same period in 2008. OTTI charges totaled $1.3 billion through the first nine months of 2009. Excluding OTTI charges, U.S. Central recorded net gains on financial instruments of $0.5 million for third quarter, compared with losses of $3.9 million for the same period in 2008. Assets as of Sept. 30 totaled $28 billion--up $0.9 billion or 3.2%, from $27.1 billion as of Dec. 31, 2008. The increase reflects primarily an increase of $5.9 billion in cash, offset by a $2.3 billion decline in the fair value of U.S. Central's investment securities and a $2.5 billion decrease in loans. Net interest income during the quarter totaled $17.1 million, compared with $42.5 million for third-quarter 2008--a decrease of $25.4 million or 59.7%. Fee income totaled $5.2 million, compared with $4.6 million for third-quarter 2008, an increase of $0.6 million or 13%. Operating expenses totaled $11.3 million, a decrease of $4.4 million, or 27.9% over the same quarter last year. Total funding, excluding capital accounts, was $36.2 billion as of Sept. 30, compared with $36.9 billion as of Dec. 31, a decrease of 1.8%. Borrowed funds dropped by $6.2 billion, and members' share and certificate accounts increased by $5.5 billion. Member accounts remain U.S. Central's primary source of funding, averaging $28.9 billion for third quarter of 2009 and equaling $25.2 billion at Sept. 30. The corporate noted that as delinquencies for consumer loans, especially mortgages continued to mount, "the market for non-agency residential mortgage-backed securities remained illiquid, although the prospect of the Public-Private Investment Program brought some renewed interest to this sector. This further deterioration caused loss projections for some of U.S. Central's non-agency residential mortgage-backed securities." For the full report, use the link.

CUs absent from Bankrate financial horror tales

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NORTH PALM BEACH, Fla. (11/2/09)--Credit unions were notably absent from a list of 12 financial horror tales published recently on Readers submitted stories about some of their most hair-raising financial experiences, some of which were self-inflicted. The stories ranged from a consumer who co-signed on a private student loan that later defaulted, to a couple who thought they had accidentally thrown away some receipts proving they had paid for repairs on their car ( Oct. 26). Specific financial institutions and credit card companies mentioned in the article included MasterCard, Chase and IndyMac Bank. One reader had deposited money into IndyMac before it failed last year. Another reader reported that after a balance transfer to a Chase credit card account on the promise of a fixed 3.99% interest rate, the rate hiked to 5%--meaning that the accountholder’s minimum balance increased to $440 from $165 a month. The reader said she and her husband “went into survival mode” to save enough money to pay off the card. The mother of one reader had a MasterCard account that had $43,000 in fraudulent charges. The card company did not contact her regarding the charges even though she had a $40,000 credit limit and “special monitoring,” the reader said. Another individual submitted a story about an interest rate hike she received when she made a mistake entering her bill payments online. Instead of paying the card company $243, she accidentally transposed the numbers and paid $234. She was hit with a $36 late fee, and her 2.9% interest rate hiked to 27%. The reader contacted the credit card company about the hike, and the company said it would drop her interest by 1% if she made good on future payments. However, because the reader had a revolving balance on the card, she scrambled to find the money she needed to pay off the card to avoid more charges. To read the horror tales, use the link.

Three N.M. CUs tout youth activities at summit

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ALBUQUERQUE, N.M. (11/2/09)--Three New Mexico credit unions shared how they are reaching out to youth during a recent Governor’s Education Summit in Albuquerque, according to the Credit Union Association of New Mexico. New Mexico Educators FCU, Albuquerque, is opening a branch at Atrisco Heritage Academy that will serve students and the community, said Sharla Reinhart, vice president of membership development. The branch will provide hands-on training for students. The academy credit union program is expected to begin in January with a grand opening in September. Financial Security CU in Carlsbad created a focus group to determine which financial services it should offer youth. CEO Judy Carrasco created a teen advisory board to help the credit union design products and services for youth ages 13 to 18. Carrasco said the teen board’s response has been “prolific” and “occasionally surprising.” The teens said they want to learn about loans, earning interest and fees, and suggested the credit union offer workshops. With the help of the teen board, Financial Security created a savings product with rewards on gifts, a college fund that rewards savers with a new computer when they start higher education, checking, a loan program and a certificate of deposit product. High Plains FCU, Clovis, has reached out to youth with a summer lemonade stand project and a Rock Band video game competition, said Kym Moore, education specialist. The credit union also has its Gear Up youth program to reach out to youth through music. The credit union created a rap song, “Stash Yo Cash,” which will premiere on its website with a video. The credit union also plans to open a branch for students at Clovis Freshman Academy.

Study Bad online ad campaign worse than no campaign

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MADISON, Wis. (11/2/09)--Poorly conducted online advertising campaigns not only fail to get the message across, they could negatively impact the brand of a company, such as a credit union, according to research by Dynamic Logic, a marketing research company. The bottom 20% of online ad campaigns negatively impacted opinions of Internet users exposed to the ads, the company said (The e-Marketer Daily Oct. 29). Also, “purchase intent” was reduced the most--among the five factors measured--by a bad campaign by 4.1 percentage points. Other factors measured included: “aided brand awareness,” “online ad awareness,” “message association,” and “brand favorability.” Conversely, top-performing ad campaigns heightened online awareness, message association, and brand awareness by more than eight percentage points each, the company said. “When it comes to digital advertising, a lot of time is spent choosing websites, ad sizes, formats, targeting and other factors,” said Ken Mallon, Dynamic Logic’s senior vice president of custom solutions. “However, not enough time is spent producing and testing high quality ads.”

Prestigious award is vanity scam says N.J. league

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HIGHTSTOWN, N. J. (11/2/09)--Recent e-mails notifying credit unions and other businesses that they have won prestigious awards from a national association appear to be part of a widespread scheme to get companies to pay for “vanity” awards and plaques, says The New Jersey Credit Union League. The group behind the “awards” program is the U. S. Commerce Association of Washington, D.C. The association sent out e-mails and news releases in recent months to businesses nationwide, telling them they have been selected as “outstanding local businesses” and offering them an opportunity to buy one or more awards to mark the honor (The Daily Exchange Oct .30). An e-mail recently sent to Healthcare Employees FCU, Princeton, N.J., said: “I am pleased to announce that Healthcare Employees FCU has been selected for the 2009 Best of Princeton Award in the Credit Unions category by the U.S. Commerce Association. In recognition of your achievement, a 2009 Best of Princeton Award has been designed for display at your place of business. “You may arrange to have your award sent directly to Healthcare Employees FCU by following the simple steps on the 2009 Best of Princeton Award order form,” the e-mail continued. “Simply copy and paste this link into your browser to receive your award.” The e-mail also has a link to the association’s own website to a press release that announces the recipient credit union has won the award, the league said.

CU System briefs (10/30/2009)

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* OREM, Utah (11/2/09)--Faith prompted a man to surrender and admit his role as a getaway driver in the Dec. 23rd robbery of Alpine CU, said Orem, Utah, police (The Salt Lake Tribune Oct. 29). The Pleasant Grove man, whose name was not disclosed, approached the police after confessing the crime to his Church of Jesus Christ of Latter-day Saints bishop. His accomplice was arrested, but prosecutors had not decided yet what charges the getaway driver would face. Alpine CU has $138.1 million in assets and is based in Orem … * MADISON, Wis. (11/2/09)--A Madison, Wis., man was sentenced to 11 years in prison for robbing a Verona, Wis., bank in May. Reginald J. Ballard, 38, pleaded guilty in August to robbing Capitol Bank--the third financial institution he said he had intended to rob that day, he told police. He lost his nerve outside two other institutions, including Heartland CU. Heartland reported his suspicious activity to police, which were nearby by the time Ballard left the bank he'd just robbed. A suspect believed to be a getaway driver, Thurman M. Wyatt, 29, Madison, was charged with illegal gun possession and is awaiting trial (The Capital Times and Wisconsin State Journal Oct. 29) … * SOMERVILLE, Mass. (11/2/09)--Cambridge Portuguese CU (CPCU CU) was voted 2009 'Best Bank' by readers of The Somerville News for the second consecutive year, according to the $85 million asset credit union. In the past year, CPCU increased its community involvement by partnering with local community non-profit organizations, entering the business lending arena with business products and services, and reaching out to new membership. "It was great news last year when we won the Best Bank award, but to win two years in a row shows that CPCU is making a difference in the community. We pride ourselves on the service we provide to everyone who walks through our doors," said Rui Domingos, CPCU CU CEO … * WHITE RIVER JUNCTION, Vt. (11/2/09)--Vermont VAF Employees FCU, which was chartered in 1939 as the first Vermont credit union, has changed its name to Vermont VA FCU. The name change was made to more accurately reflect the credit union’s membership, its board said. Vermont VA FCU’s new logo reflects the values that form the basis of its commitment to its membership of war veterans, the credit union said (Newlines Express Oct. 30) ... * ONTARIO, Calif. (11/2/09)--The California and Nevada Credit Union Leagues recently launched their “Help You Thrive” website--a free WebMD-styled database for consumers to find resources for their financial needs. The site,, provides basic information and guidance on topics, ranging from managing debt and protecting personal data to buying a home and payday lending. Information also can be found on lending products--such as mortgages--as well as how to avoid scams, and how to teach young people about finances. Also, the site features calculators and worksheets. Although the site was started and is being managed by credit unions, it is not limited to use by or for credit unions, said the leagues … * PARCHMENT, Mich. (11/2/09)--First Community FCU, Parchment, Mich., recently
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hosted a First Community Fall Harvest Festival where youth received treats and a chance to learn about money. The festival incorporated an “EARN-SAVE-SPEND” component where each youth received a treat bag with cash bucks that could be spent at the event any way they wished as long as it was within a budget. Youth received a budget worksheet, a Rockin Cash coloring page that teaches the difference between coins and dollars, and a “How Can I Earn Money?” page listing ways they could earn money at home and in the community. The event also had two games, “Watch Your Money Grow,” and “Rock The Facts...Beat the Fiction.” The credit union plans to host another festival next year. First Community has $404 million in assets. (Photo provided by First Community FCU) ... * FAIRBORN, Ohio (11/2/09)--Wright-Patt CU has announced five families who will compete in its second annual Savings Race. Ten semi-finalists were selected by the credit union through an application and interview process in September. The five finalists were selected from that group in an online vote. During the race, the families will be challenged with finding innovative ways to increase their savings and reduce debt. They will be given specific savings and debt-reduction goals to achieve by the end of the race with the help of Wright-Patt coaches. Their success in meeting or exceeding the goals, along with the results of public online voting, will determine the winner--who will receive $10,000. The race concludes in May. Last year’s challenge resulted in five families collectively increasing their net worth by $145,000, the credit union said ...