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CU System

Michigan league granted 43828 for foreclosure video

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PLYMOUTH, Mich. (10/7/08)--The National Credit Union Foundation (NCUF) awarded an innovation grant of $43,828 to the Michigan Credit Union League for a video on foreclosure prevention that will be distributed though credit unions and online. It will inform homeowners about money management and financial resources. The video will be the centerpiece of a Web page for troubled homeowners that will include information on mortgage relief programs such as those offered by the U.S. Department of Housing and Urban Development and the Michigan State Housing Development Authority. The league also will distribute the video through a partnership with the Michigan State University Extension and the Michigan Association of United Ways. “The video will help credit unions to be even more a part of the solution to the foreclosure crisis,” said CU Village President and Chief Operating Officer Todd Mason. “By combining the educational power of a video and the resources available on the website, we are able to provide a tool to help people avoid the trap of foreclosure. The credit union network and our partners in this project will make sure that the video is seen by those who need it.” The NCUF supports projects by credit unions and state leagues that make a difference in local communities. Its Community Investment Fund has given out more than $500,000 this year.

Leagues full-court press on safety continues

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MADISON, Wis. (10/7/08)--Several state credit union leagues are continuing the movement’s push to let consumers know about the safety and soundness of credit unions amid the financial turmoil afflicting the U.S. Here are the steps some leagues that have taken to assure members:
* The Maryland and District of Columbia Credit Union Association Community Outreach Committee is sponsoring a fall ad campaign focused on safety and soundness of credit unions in Maryland and Washington D.C. Thirty-second ads and traffic sponsorships will be broadcast on top-rated radio stations in the Baltimore; Washington, D.C.; and Western Maryland media markets (Focus Newsletter Oct. 6); * The Michigan Credit Union League (MCUL) is deploying a new radio campaign to inform consumers that credit unions are safe, sound and trusted. MCUL hosted two meetings last month with credit unions in the state to discuss a supplemental radio advertising campaign to begin this month. Forty of Michigan’s 50 largest credit unions listened on Sept. 30 to MCUL’s idea of covering the state with radio commercials touting the trustworthiness of credit unions. Later that day, 132 credit unions were presented the idea on a conference call. Both groups responded positively to the idea of the campaign, MCUL said (Michigan Monitor Oct. 6); * A safety and soundness toolkit developed by TCUD is available on the Texas Credit Union League website (LoneStar Leaguer Oct. 6); * The Missouri Credit Union Association (MCUA) has worked with public relations firm Fleishman Hillard to distribute news releases to media outlets statewide about the good shape of credit unions. MCUA staff also have conducted interviews with local media about credit unions’ financial situation. Missouri credit unions grew $555 million in deposits last year--the highest level since 2004; credit unions loan-to- share (savings) ratio is 79%; and credit unions have $1.5 billion available to loan to members, MCUA said (The Missouri Difference Oct. 3) … * The Delaware Credit Union league will highlight the issue of credit union safety and soundness, and the difference between credit unions and banks in this year’s Credit Union Week supplement in The News Journal on Oct. 14 (Together Sept. 30); and * The Pennsylvania Credit Union Association’s Michael Wishnow, vice president of marketing and communications, told a local newspaper that if a credit union issues a mortgage, it’s usually at a fixed rate. The credit union likely will hold the mortgage for its duration, rather than selling it to another bank or mortgage broker in the secondary market. Because credit unions keep the mortgages, they have to be more fiscally conservative, Wishnow told the paper (Bucks County Courier Times Oct. 6) …

Latest successes of CUs in the media

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MADISON, Wis. (10/7/08)--Credit unions continue to spread the message of their safety and soundness through various media outlets. Some examples:
* Department of Labor FCU, Merrifield, Va., was featured in a newscast Oct. 2 on NBC4 in Washington, D.C. The news program spotlighted a Department of Labor FCU member who found the credit union’s payday lending alternative, Stretch Pay, as a way to get out of high-priced payday loans. Joan Moran, Department of Labor FCU CEO, said the credit union uses the Stretch Pay program to serve its members, and not to make a profit (Focus Newsletter Oct. 6). * Family First CU, Orem, Utah, announced that it has faced a minimal impact from the turmoil on Wall Street. “Family First has not been out there buying mortgage-backed securities as investments or making subprime mortgage loans, but following conservative, sound lending practices,” said Todd Hatfield, Family First assistant vice president of mortgage development in a press release. “It has pretty much has been business as usual for us, as we are welcoming first-time buyers and have been able to get them into a conventional loan with as low as 5% down.” * Nine credit unions in the Schuykill Valley Chapter in Pennsylvania sponsored an ad in the Reading Eagle Oct. 4 with the headline, “It’s Great to Belong to a Credit Union.” The ad notes that credit unions are safe, sound and federally insured (Life is a Highway Oct. 6). * Pennsylvania State Employees CU President/CEO Greg Smith appeared on a segment of Smart Talk on WITF-TV Friday. The topic was, “The Financial Crisis--What it Means to Pennsylvanians.” * Ed Mierzwinski, consumer program director at the U.S. Public Interest Research Group, plugged credit unions in an online story. “In general, my recommendation is to bank at a credit union, not at a bank,” he said (Life is a Highway Oct. 6). * Eight credit unions in the Altoona Chapter of Credit Unions produced an ad campaign, “Safe. Sound” with newspaper ads, statement stuffers, lobby posters and other ad pieces. The newspaper ads ran on Saturday and will run again on International Credit Union Day (Life is a Highway Oct. 3). * SPE FCU, State College, Pa., ran a color ad in the Center Daily Times Saturday and Sunday, which focused on the safety of credit unions. * Tobyhanna Army Depot FCU, Scranton, Pa., placed a message on its website promoting credit unions. WNEP Channel 16 also filmed a consumer segment at the credit union Sept. 26 (Life is a Highway Oct. 3). * Heritage Family FCU President/CEO Ron Hance and Opportunities Mortgage Specialist Erica Glidden spoke with Vermont Public Radio on the $700 billion bailout bill. They also talked about how the financial crisis affected the Rutland, Vt.,-based credit union, according to the Association of Vermont Credit Unions. The credit union is continuing to sell mortgages, Hance said. But mortgages are becoming more difficult to maintain, Glidden added (Newsline Express Oct. 3). * Credit unions were noted in the Macon Telegraph Friday in a question-and-answer article. The newspaper stated that credit unions are insured by the National Credit Union Share Insurance Fund and no money in the fund has ever been lost (Oct. 3). * MaPS CU, Salem, Ore. opened 34% more new checking accounts this month compared with September 2007 because of the economic crisis. Oregon State University (OSU) FCU, Corvallis, Ore., also saw an increase in the number of accounts. OSU FCU opened a new branch in West Salem recently (Statesman Journal Oct. 2).
In the Media CUs: Safe and Sound statement stuffer http://buy.cuna.org/detail.php?sku=22959 Your Insured Funds booklet http://buy.cuna.org/detail.php?sku=13103

13 employees of MCT CU relying on kindness for shelter

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PORT NECHES, Texas (10/7/08)--MCT CU in Port Neches, which made it through Hurricane Ike relatively unscathed last month, is offering assistance to employees of its Lumberton branch who were not as lucky. The Lumberton branch’s roof was ripped off. Heavy rain submerged the building and caused extensive damage, forcing employees to work out of a temporary mobile unit. Also, 13 of the branch’s 95 employees were displaced from their homes, said the Texas Credit Union League (LoneStar Leaguer Oct. 6). “The hurricane has passed, and many of us have resumed life as normal; however, we need to remember that many families in Southeast Texas have lost everything and their lives will never be the same,” Jill Forse, MCT vice president of human resources, told the Texas league. “Thirteen of our employees are relying on the kindness of friends and family for shelter. Yet, despite their own personal hardships, they show up to work every day with a smile on their faces and a sincere desire to serve our members,” Forse said. “To me, that demonstrates true perseverance.” MCT is doing all it can to assist employees, including allowing them time off to deal with insurance contractors, insurance adjustors and the like, she said. The credit union also has begun a collection drive to help the 13 most-affected employees replace lost items. All have received emergency grants from the Texas Credit Union Foundation (TCUF). Credit union employees statewide who experienced personal losses due to Hurricane Ike are continuing to submit grant applications for aid to TCUF. As of Friday, TCUF had distributed 749 grants, totaling $360,690, the foundation said.

Schwarzenegger vetoes data breach bill--again

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SACRAMENTO, Calif. (10/7/08)--California Gov. Arnold Schwarzenegger vetoed legislation last week--for the second time in the past year--that would have required retailers and other businesses in the state to implement measures to protect credit and debit card data. Assembly Bill 1656--the Consumer Data Protection Act--also would have required retailers to disclose more details about data breaches to consumers impacted by them. The California State Senate and Assembly passed AB 1656 by a substantial margin last month (Computerworld Oct. 6). “The veto of the bill is obviously disappointing to the California and Nevada Credit Union Leagues,” Melissa Ameluxen, legislative and regulatory lobbyist for the leagues, told News Now. “We’re not going to stop fighting for this measure until we are confident that California retailers are ensuring that Californians’ personal financial data is safe and secure every time they use a debit or credit card.” The issue has been a popular one. Therefore, some legislator is “very likely” to take up the issue again next year, Amulexen said. The California league had pledged to renew its efforts to pass a data protection bill in the wake of Schwarzenegger's [first] veto in October 2007 of a league-backed bill to protect consumers from the effects of data breaches (News Now Oct. 16, 2007) Last year, Schwarzenegger vetoed AB 779, authored by Assemblyman Dave Jones (D-9), after intense opposition from retailers and bankers. This year’s bill would have required retailers to adopt security standards based on industry best practices when storing consumers' credit and debit card information, and give consumers better information about when and where their personal financial information is stolen during a data breach. In 2006, the nation's largest data breach of data from TJX Cos. resulted in the theft of 46.5 million consumers' credit or debit card information (News Now Sept. 4). While credit unions and other financial institutions worked to replace the breached cards, they were not able to inform consumers where the breach occurred.

WOCCU adopts international principles

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MADISON, Wis. (10/7/08)--The World Council of Credit Unions (WOCCU) is piloting the International Credit Union Consumer Protection Principles with select credit unions. WOCCU also will participate with other leading microfinance agencies to assure equitable lending and savings practices gain global acceptance. The principles, approved in July by the WOCCU General Assembly in Hong Kong, is the latest in a series of international credit union guidelines issued by the organization. The nine principles are designed to supplement rather than supplant local regulatory requirements and prudential standards, offering “best practice“ models for serving credit union members, according to Dave Grace, WOCCU's vice president of association services. “Credit unions around the world exist to serve their members, but not all members are served equally,” Grace said. “Credit union members worldwide have the right to expect fair and ethical treatment delivered with a high degree of honesty and integrity. WOCCU's principles outline standards for ethical member service applicable to all credit unions wherever they are located.” The nine principles were developed over two years through a participatory process with WOCCU's members and global experts on consumer protection. The principles form the cornerstone of WOCCU's efforts in Kenya, Mexico and the Philippines, where credit unions are piloting a program that assesses credit union performance against the principles and implements changes where gaps exist. WOCCU expects the initial program to take six to nine months to complete. Results will guide application of the principles among credit unions in other countries, Grace said. WOCCU also is participating in a work group under the auspices of the Center for Financial Inclusion at ACCION International, a Boston-based microfinance organization. In addition to Grace and representatives from credit unions piloting WOCCU's principles, participants in the group include Deutsche Bank, the Consultative Group to Assist the Poor and other organizations. The work group will take a broader look at financial service conditions in developing countries, but WOCCU's efforts will focus solely on credit unions, Grace explained. “The Consumer Protection Principles were approved during a time when credit union systems in WOCCU member countries like Australia and Ireland were examining their own codes of conduct, and in the wake of a U.S. economy reeling from a subprime mortgage crisis caused by financial institutions clearly not operating in consumers' best interests,“ Grace said. “We're confident results from our pilot studies will show that serving members ethically and honestly is simply good business.” WOCCU's International Consumer Protection Principles address several issues:
* Disclosure of rates and fees: Credit unions shall present savings and share fees, and interest and dividend rates clearly and in writing to members before completing any transaction; * Periodic statements: Credit unions shall distribute comprehensive member statements disclosing loan and savings balances, rates, fees and finance charges quarterly; * Honest and non-deceptive promotions: All marketing and advertising shall contain honest and relevant information to help members make informed decisions; * Fair credit practices: Credit unions shall provide members with accurate, comparable, transparent and complete information about the total cost of loans, including fees and commissions as required under applicable law; * Dignified collection practices: Credit unions may exercise persistent collection practices as needed, but shall not harass nor physically or verbally abuse members in the process; * Members' consent to share information: Credit unions shall provide members with the option of not having their personal information shared with third parties for the purpose of selling members products or services; * Dispute resolution services: Credit unions shall provide members with options to settle disputes to augment options offered through the legal system; * Provide education about thrift and wise use of credit: Credit unions shall educate and provide members with tools describing how to accumulate wealth and use credit wisely; and * Fair and forthright conversions: Credit unions seeking to demutualize must have at least 30% of their members directly vote on the issue, with 75% voting in favor of demutualization.

CU System briefs (10/06/2008)

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* SAN ANTONIO (10/7/08)--President George W. Bush Sunday honored Sonya McDonald, vice president of sales operations, Randolph-Brooks FCU, Live Oak, Texas, with the President's Volunteer Service Award for her volunteer work with Fisher House and Returning Heroes Home. "What a tremendous honor for Ms. McDonald, and of course, Randolph-Brooks FCU," said Texas Credit Union League President/CEO Dick Ensweiler. He noted the "tireless commitment and energy she has devoted to this noteworthy cause is to be applauded." In 2006, while her husband was deployed to Iraq, McDonald spearheaded a fundraising effort for Fisher House, a national foundation that provides military families a home away from home to be near hospitalized loved ones. Her goal was to raise $200,000 between Memorial Day and Independence Day 2006. Soliciting help from local businesses and organizations, she raised more than $217,000. Randolph-Brooks FCU matched and exceeded that amount, and the funds went to support the Fisher Houses at Fort Sam Houston, which opened last year. McDonald is also on the board of Returning Heroes Home, which is building a 12,000 sq. ft. house at Fort Sam Houston to help military members and families learn to cope with war-related injuries. The house will open in December. President Bush honors a local volunteer when he travels throughout the U.S. He has met with more than 650 volunteers since March 2002 … * ST. LOUIS (10/7/08)--Mid Missouri CU volunteer D. Virginia Thompson, left, was inducted recently into the Defense Credit Union Council's Hall of Honor, by DCUC President Roland A. "Arty" Arteaga, right (The Missouri Difference Oct. 3). Thompson serves on Ft. Leonard Wood, Mo.-based Mid Missouri CU's board of directors. According to Mid Missouri CU President Sharon Ichord, Thompson was one of the founders of the credit union, which grew from $325 in assets to more than $130 million. (Photo provided by the Missouri Credit Union Association) … * ST. LOUIS (10/7/08)--Kirkwood Municipal CU, a $3.2 million asset credit union based in Kirkwood, Mo., has merged with $109.2 million asset West Community CU, O'Fallon, according to the Missouri Credit Union Association. Gary Hinrichs, West Community president/CEO, noted that the credit union has a lot of members living in the Kirkwood area. The staff from Kirkwood Municipal will stay on to serve at the branch. West Community is working on a new branch near the current Kirkwood Municipal location. The move is slated for November. The new location with be a Shared Branch (The Missouri Difference Oct. 3) … * ROCKVILLE, Md. (10/7/08)--Rockville-based MCT FCU's 45-day summer Green Auto Loan campaign boosted its loan portfolio by $10 million-- or $3.5 million more than its goal, said the Maryland and District of Columbia Credit Union Association (MDDCCUA) (Focus Newsletter Oct. 6). On July 15, the credit union launched an auto race-themed competition to motivate staff to meet lending goals and promoted the event through its internal e-newsletter, The Buzz. The program offered members a 0.25% discount on their auto loan rate upon purchasing or refinancing a fuel-efficient vehicle. It sponsored traffic reports on three major radio stations in the DC metro area, offering $100 gift card incentives for online loan applications. It also advertised through websites such as Facebook and displayed banners outside each branch advertising new- and used-auto rates as low as 3.99% annual percentage rate. MTC FCU's Clarksburg branch employees, shown here, won the loan rally (Photo provided by the Maryland and District of Columbia Credit Union Association)