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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 Bankrate.com. 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 (Bankrate.com 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, http://helpyouthrive.ccul.org, 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 ...

Altura CU reports good 3Q in hard-hit Inland Empire

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RIVERSIDE, Calif. (10/30/09)--Altura CU, located in the Inland Empire, Calif., an area hit hard by the economy, reported Thursday a significant improvement in its bottom line results for third quarter 2009, compared with the third quarter of 2008. Altura's assets total $889.7 million and it has $1.8 million in net income, a substantial increase, the credit union said. While still reporting a loss from operations through the first nine months of the year, the third-quarter results suggest economic conditions in the region are beginning to show improvement, said Altura CEO/President Mark Hawkins. "While we remain in a very tough environment, we are pleased with our third quarter results and believe we are positioned for success in the coming year," Hawkins said. The credit union raised its capital ratio from 7%--considered "well capitalized" by regulators--to 7.42%. "The key to protecting our capital is preserving the safety and soundness of our real estate portfolio. We have been enduring the worst loan losses in our history; a national phenomenon that has been particularly bad in the Inland Empire where our unemployment rate (14.5%) is far higher than the national average," Hawkins said. However, the credit union took steps to help members through the troubled times, with "an aggressive program of loan modifications and debt workouts for our members to help them stay in their homes. We have extended the hours of our loan servicing staff, and we're working closely with members to help them understand their options." The result, he said, shows in the third quarter performance results and the increase in the capital ratio. Altura also reported a 12.2% growth in total member share/deposits in the past 12 months, and it reduced its operating expenses for third quarter by 8.1% from third quarter 2008. Hawkins is cautiously optimistic about fourth quarter. "Although I believe the Inland Empire isn't out of the woods yet, I think better times are coming." He noted that the credit union's focus on the needs of its members through the "economic cataclysm" has helped protect Altura.

CU first in Michigan to allow e-mortgage closings

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EAST LANSING, Mich. (10/30/09)--Michigan State University FCU is the first credit union in Michigan to allow members to close on their mortgages electronically, says the Michigan Credit Union League. Members of the $1.7 billion, East Lansing-based credit union can apply for a mortgage online and share their documents with attorneys and family members through a secure website (Michigan Monitor Oct. 26). The members then complete the process on a touch screen computer at the credit union, where they receive a flash drive or CD containing all the documents to take home and store for future use. "Giving our members electronic access to online applications, closing documents and the convenience of an e-closing all enhance our members' experience with the credit union," said Jeffrey Benson, MSU FCU vice president of operations. "We want to be the first lender our members think about when it comes to financing their homes, vehicles and other things necessary to their lifestyle. Being a leader in electronic services enhances our relationship with our members." The credit union offered a demonstration Thursday at its headquarters.

Spike in fraud alerts is no Halloween prank

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WASHINGTON (10/30/09)--This week saw several government warnings and alerts about financial frauds as well as several credit unions reporting other scams that could spook some accountholders. But these are no Halloween pranksters. Keesler FCU reported that at its base in RAF Mildenhall, England, about 100 members saw fraudulent charges on their accounts this month (Stars and Stripes Oct. 28). All affected accountholders had visited Spain sometime this year, Michelle Foster, a loss prevention manager for Keesler told Stars and Stripes. The losses were from Visa debit cards. Visa said it is aware of a possible security issue in Spain but said the investigation was ongoing and it couldn't comment. Visa Europe contacted several affected banks and credit unions when the fraud was discovered. One Keesler member reported charges of $539.16 from boutiques in Chicago suburbs. She said the only time she used her debit card while in Spain was at a mom-and-pop store near the beach. Another credit union , Service CU, which has 15 locations in Germany and 17 in the U.S., saw less than one-half of 1% of members' cards compromised by the breach, the newspaper said. In another situation, the Federal Deposit Insurance Corp. (FDIC) Thursday issued an alert warning financial institutions of an increase in schemes to recruit individuals to receive and transmit unauthorized electronic funds transfers (EFTs) from deposit accounts to individuals overseas. The recruitees or "money mules" are solicited on the Internet by criminals who have gained unauthorized access to the online deposit account of a business or consumer. The criminal will originate an EFT from a victim's account to a money mule's deposit account. The money mule is told to quickly withdraw the funds and wire them overseas after deducting a "commission" of 8% to 10%. The schemes often occur in the context of online job posting websites, advance fee scams, mystery shopping jobs, and social networking sites. Some hesitant money mules have been threatened by their criminal "employers" if they don't make the transactions quickly and secretly, said the FDIC. The personal identifiable information provided by the money mule may be used later to commit identity theft or account takeover. FDIC cited several examples of events may indicate money mule account activity:
* A deposit account opened with a minimal deposit soon followed by large EFT deposits. * Deposit customers who suddenly begin receiving and sending EFTs related to new employment, investments, business opportunities or acquaintances (especially opportunities found on the Internet). * A newly opened deposit account with an unusual amount of activity, such as account inquiries, or a large dollar amount or high number of incoming EFTs. * An account that receives incoming EFTs and then shortly afterward originates outgoing wire transfers or cash withdrawals about 8%-10% less than the incoming EFTs; and * A foreign exchange student with a J-1 Visa and fraudulent passport opening a student account with a high volume of incoming/outgoing EFT activity.
Other frauds noted:
* Credit unions in Western Pennsylvania opened accounts for a man who deposits bad checks into the new account and withdraws the funds before they are returned as a "closed account." Sandy Shenk, PaCUSC state coordinator, has warned credit unions on the shared-branching network to establish procedures for allowing new members access to shared branching services. "This is a perfect example of why we suggest that credit unions require new members establish a relationship with them before allowing them to use other locations (Life is a Highway Oct. 29). * The FDIC issued a warning Tuesday about fraudulent e-mails appearing to be from the FDIC. The e-mails ask recipients to download and open a "personal FDIC insurance file" to check their deposit insurance coverage. The subject line includes the wording, "check your Bank Deposit Insurance Coverage." The message asks recipients to "visit the official FDIC website" by clicking on a hyperlink that appears to open forms. The hyperlink instead downloads an executable file that may try to obtain personal and confidential information, the FDIC said. * A debit/credit card scam has targeted shoppers at Hancock Fabrics in Stevens Point and Marshfield, Wis., and the account information has been used for unauthorized transactions at ATMs in the Milwaukee area (Stevens Point Journal Oct. 17). Police said the scam might be traced to old credit card readers at the fabrics stores.

CU takes steps to protect staff from germy cash

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HARRISBURG, Pa. (10/30/09)--With as many as 5.7 million Americans infected with the H1N1 virus between April and late July and many more cases expected, some credit unions are taking precautions. One credit union in Pennsylvania was featured Wednesday on a local television station discussing its flu strategy. Staff at First Capital FCU, West Manchester Township, Pa., were interviewed by Fox 43 WPMT-TV about what it is doing to avoid handling germy money during the flu season. Its employees are wearing latex gloves when they handle cash or pay slips, said the station. The credit union also has made available antibacterial wipes and increased cleaning schedules. Human Resources Manager Linda Thompson told the station she sees how easily germs can spread. "It's on cash, withdrawal slips, everything. Especially at the end of the week when we are dealing with a high amount of transactions. We're taking steps to keep our employees and members healthy." Money is considered a fomite--a material that can hold onto germs and transfer them. The fact that money isn't washed and changes hands frequently make cash especially germy. Even ATMs are covered in germs, according to Dr. Jonathan Schwab of Northampton, Mass. (wwlp.com Oct. 29). He advises washing hands frequently and carrying a small bottle of hand sanitizer when one can't get to a sink. The U.S. Centers for Disease Control and Prevention researchers used computer models to estimate the number of people who have contracted the swine flu. They don't have an update beyond July 24 (Reuters Oct. 29). They estimated that 1.8 million to 5.7 million Americans had the virus between April and July 23, sending between 9,000 to 20,000 people to the hospital. About 6% of people who were hospitalized with the virus died, researchers said. For information about stopping germs at work and planning for a pandemic, use the resource links.

StretchPay now offered at 170 branches

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COLUMBUS, Ohio (10/30/09)--StretchPay, the short-term loan program offered by credit unions as a salary-advance alternative, is now offered at 170 branch locations in six states and in Washington, D.C. Collectively, credit unions offering StretchPay have made 66,000 advances totaling more than $24 million through Sept. 30--a slight increase over the same period last year, said the Ohio Credit Union League (eLumination Newsletter Oct. 28). Credit unions made 85,090 StretchPay advances totaling $32.4 million through year-end 2008, the league added. Changes have been made to the program to make it compliant with the federal Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. As of Sept. 15, StretchPay no longer is a 30-day, short-term loan product. It now is a short-term revolving loan with repayment due dates, ranging from 28 to 60 days, said the league (News Now Sept. 18).

IForbesI media broadcast positive CU card study

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NEW YORK and BOSTON (10/30/09)--Forbes and the Boston Globe are among the media that have broadcast positive news about credit unions' credit card behaviors from a study by Pew Charitable Trusts. Forbes asked in a headline, "Want a Better Credit Card? Consider a Credit Union, Study Says" (Forbes.com Oct. 28). The article begins: "Sick and tired of high credit card fees? A piece of credit union-issued plastic may be the answer. That's because credit unions offer cards on terms that are significantly better for consumers than those issued by big banks, according to a newly released study…" The Boston Globe reported that in contrast to banks' procedures: "Pew found that the 12 largest credit unions, which have just 1% of the market, have lower interest rates, lower fees, and less punitive policies Most still have contracts that allow them to change the terms at will or take other actions the law will prohibit. But even when credit unions use such practices as penalty rates or overlimit fees, they tend to be less expensive than banks, the study said. For instance, credit unions offer cards with average late and overlimit fees of $20, versus $39 for banks." The study gathered information on about 400 credit cards issued by the 12 largest banks and the 12 largest credit unions. It concluded that credit cards offered by credit unions provide their members with more reasonable annual percentage rates, cash advance fees, late fees, and other fees. It also found that penalty fees at the largest credit unions were nearly half of those assessed by the larger banks (News Now Oct. 29). Credit Union National Association President/CEO Dan Mica noted that the study "is another example of an independent third party which has confirmed that credit unions, on their own and without prompting from regulators, provide their members with honest, fair deals." It also is evidence, he said, "that all the new regulations coming down on financial services are unlikely to change the behavior of credit unions since they are already doing the right things."

Grant implements payroll card program for unbanked

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COLUMBUS, Ohio (10/29/09)--The National Credit Union Foundation (NCUF) awarded a $15,525 Innovation Grant to Seven Seventeen CU of Warren, Ohio, to implement a payroll card program for unbanked workers, says the Ohio Credit Union League. The $759 million-asset credit union will offer the outreach program through its business partners, who can directly disburse wages onto Visa-branded prepaid cards for its employees (eLumination Newsletter Oct. 28). The payroll card will provide workers who lack depository relationships with financial institutions benefits that are similar to direct deposit. The goals of the project are to provide unbanked consumers with:
* A low-cost alternative to check-cashing outlets; * A convenient way to access their funds; and * A way to encourage member savings.

September CU loans rise less than expected

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MADISON, Wis. (10/30/09)--Credit union loan balances rose a less-than-expected 0.09% in September, down from last year's pace of 0.53%, according to a Credit Union National Association (CUNA) economist’s analysis of CUNA’s monthly sample of credit unions. “Consumer credit demand remains weak in the face of serious adverse economic headwinds,” Steve Rick, CUNA senior economist, told News Now. “Job insecurity, stagnant wages, falling employment and high debt levels will weigh on loan growth into the first half of 2010.
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“Credit union fixed-rate, first-mortgage loan balances rose 1.1% in September, buoyed by low mortgage interest rates and the first-time homebuyer tax credit,” he added. “For the first nine months of the year, loan balances rose only 1.9%, down from 5.7% for the similar time period last year.” Following were unsecured personal loans (0.6%), other mortgages (0.5%), used-auto loans (0.3%), and credit card loans (0.2%). Home equity loans decreased 0.2%, and adjustable-rate mortgages and new-auto loans declined 0.4% and 0.7%, respectively. Credit union savings balances increased 0.1% in September and 8.6% during the first nine months of 2009. Individual retirement accounts for the month increased 2.1%, followed by regular shares (0.9%) and money market accounts (0.7%). One-year certificates and share drafts decreased 1.0% and 4.6%, respectively.
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“With loan growth so far this year less than half last year’s pace, deposit growth is almost double last year’s pace,” Rick said. “Credit union savings balances are up 8.6% in the first nine months of 2009, up from 4.8% last year. Credit union members are parking funds in money market accounts--18.2% growth year-to-date--and regular share accounts--9.8% year-to-date--rather than reinvesting their funds in certificate of deposits at the current low market interest rates. “This is helping to reduce credit union funding costs and boost net interest margins as higher-cost certificates of deposit roll into lower-cost core deposits,” he added. The movement’s overall capital-to-asset ratio increased to 10% in September. The total dollar amount of capital is $89 billion. Credit union 60+ day delinquencies increased to 1.8% during the month. “Credit quality continued to deteriorate with credit union loan delinquency rates rising over 1.77% in September, up from 1.69% in October and 1.01% last September,” Rick said. “With the economy still shedding a couple hundred thousand jobs each month, we can expect the delinquency rate to remain on its upward trajectory for the next few quarters.” The loan-to-savings ratio increased to 78.1%. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--remained constant at 19%.

Four CUSOs discuss back-office collaboration

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GRAND RAPIDS, Mich. (10/30/09)--Four credit union service organizations (CUSOs) recently gathered to discuss back-office collaboration and a cross-network approach to servicing credit union owners and clients. The group, which met in Grand Rapids, Mich., discussed standardizing product offerings, sharing workflow best practices, and identifying new a la carte service opportunities, including back-office consulting. The meeting was hosted by CUSO Xtend Inc. in Grand Rapids. Besides Xtend, participants included CU*Northwest, Spokane, Wash.; CU*South Inc., Mobile, Alabama; and CUbyDesign, Portland, Ore. Each CUSO performs back office services for credit unions, but each provides a different scope. The group said they thought that an opportunity exists for the group to benefit from a brainstorming session. The CUSOs also use the CU*BASE core data processing suite from CU*Answers Inc., and seek to identify new software enhancements to the system during the meeting.

Sarasota Coast members back a merger

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SARASOTA, Fla. (10/30/09)--Members of Sarasota (Fla.) Coastal CU voted Sunday during a special member meeting to merge with Achieva CU, Largo, Fla., on Monday. More than 86% of members voted in favor of the merger. The resulting credit union will have more than $800 million in assets and more than 90,000 members in seven counties--Pinellas, Pasco, Hernando, Hillsborough, Manatec, Sarasota and Charlotte (Herald Tribune Oct. 28). The contributed strengths of Achieva and Sarasota Coastal will provide even greater benefits to members, Gary Regoli, Achieva president/CEO, told the newspaper. The credit unions’ operations will begin merging early next year, with completion expected by the third quarter. Achieva and Sarasota Coastal have been discussing a merger since April. The two signed a letter of intent to merge July 31.

Mississippi announces Maxwell Desjardins winners

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Click to view larger image Keesler FCU received the Mississippi Credit Union Association’s Dora Maxwell Social Responsibility Award for its participation in the American Cancer Society’s Relay for Life. The credit union created a special t-shirt for the event and raised $16,000.
Click to view larger image The Mississippi Credit Union Association awarded Keesler FCU, Biloxi, Miss., with the Desjardins Youth Financial Education Award for its MoneyTalks program, which teaches high school students about money. The program has gone international, with a debut in the United Kingdom. (Photos provided by the Mississippi Credit Union Association)
JACKSON, Miss. (10/30/09)--Keesler FCU, Biloxi, Miss., received first place in Mississippi’s Dora Maxwell Social Responsibility Award and the Desjardins Youth Financial Education Award competitions, according to the Mississippi Credit Union Association (MSCUA). The awards were sponsored by MSCUA and the Credit Union National Association. The Dora Maxwell award recognizes a credit union for its community involvement in an activity that helps others or strengthens the structure of the community. The Desjardins award recognizes credit unions that support youth financial education. Keesler was recognized for its participation in the 2009 American Cancer Society’s Relay for Life. The credit union created a special T-shirt for the event and was recognized as the top fundraising team for raising $16,000. Keesler also was recognized for its four-week MoneyTalks program, which teaches high school students how to manage their money, and other financial education programs, including classroom presentations to youth in the Mississippi Gulf Coast area. Keesler has $1.8 billion in assets.

CU System briefs (10/29/2009)

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* ALBUQUERQUE, N.M. (10/30/09)--Representatives of the Credit Union Association of New Mexico (CUANM) met earlier this month with U.S. Rep. Ben Ray Lujan (D-N.M.) to discuss some issues of concern to credit unions (CUANM Network October). Lujan was knowledgeable about the credit union position on interchange fee legislation, Community Reinvestment Act extension to credit unions and the proposed Consumer Financial Protection Agency, said the association. He said he is opposed to interchange fee legislation. He also sees a need for data security legislation. Credit unions are advocating on the national and state levels to require merchants to discard any personal or credit card information gathered from consumer. From left are Juan Fernandez Ceballos, CUANM vice president of governmental affairs; Scott Connely, CUANM Governmental Affairs Committee chairman and CEO of Sandia Area FCU; Sylvia Lyon, CUANM CEO; and Lujan. (Photo provided by the Credit Union Association of New Mexico) … * ONTARIO, Calif. (10/30/09)--The California Credit Union League's Mt. Diablo, San Francisco, North Bay and Wine Country Chapters
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raised more than $36,000 for Children's Hospital & Research Center Oakland and UC Davis Children's Hospital at their Third Annual Golf Tournament in Vallejo. Helping sponsor the event were CO-OP Financial Services, Visa, Financial Service Centers Cooperative, the Credit Union National Association, Travis CU, Redwood CU, CUDL, Executive Compensations, the Moore, Brewer, Jones, Tyler & North firm; San Francisco Fire CU, Pacific Funding, San Francisco FCU and American Home Life. Holding the check are Redwood CU CEO Brett Martinez (middle front) and other tournament coordinators Karen Introcaso, Spectrum FCU; Samantha Paull, Redwood CU; Steve Stapp, San Francisco FCU; Rob Greaff, Delta Schools FCU; Jeanie Widemann, lst Pacific CU; Andy Anderson, Travis CU; and John Pamer, Diablo Valley FCU. They are shown with representatives of Children's Miracle Network and the two hospitals. (Photo provided by the California Credit Union League) … * SANTA ROSA, Calif. (10/30/09)--Redwood CU has been selected for
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the fourth consecutive year as one of the "Best Places to Work" in the North Bay, Calif., area by the North Bay Business Journal, a weekly business publication for Sonoma, Napa and Marin counties. Winners were based on several criteria including an employer questionnaire, employee survey ratings, number of employee responses and employees' written comments. Pictured are, from left: Redwood CU employees Lyn Ly-Spelman, Richard Calenius, President/CEO Brett Martinez, Senior Vice President of Employee Relations and Development Kristina Derkos, Karen Boudrie and Bob Browne. (Photo provided by Redwood CU) …

WesCorp sells 1.5 billion in three-year notes

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NEW YORK and WASHINGTON (10/29/09)--Western Corporate (WesCorp) FCU Wednesday sold $1.5 billion in three-year government-guaranteed notes, according to IFR, a Thomson Reuters news service. The National Credit Union Administration Wednesday morning confirmed that the $18 billion asset, San Dimas, Calif.-based WesCorp was offering the notes guaranteed by NCUA under the Temporary Corporate Credit Union Liquidity Guarantee Program. J.P. Morgan and Bank of America were to serve as lead underwriters for the issuance, according to John J. McKechnie III, NCUA's director of public and congressional affairs, said Wednesday morning. The medium term notes (MTN) issuance secures another source of funding to ensure bonds can be held to recovery, McKechnie said in an e-mail to News Now staff. "Given that much of the current corporate funding is short-term, the MTN issuance will enhance stability," he said. "The issuance is part of a normal process to maintain a balanced asset/liability mix, McKechnie said. According to Reuters, the 1.75% notes were priced at 99.875 to yield 1.793%, or 35.9 basis points over comparable U.S. Treasuries. Earlier this month, U.S. Central FCU, Lenexa, Kan., completed a similar offering of $4 billion in MTN. That issuance was completed Oct. 14. Several corporate credit unions have issued debt in the form of commercial paper. Both U.S. Central and WesCorp had previously issued MTNs. In other developments, Corporate America CU, based in Birmingham, Ala., filed a lawsuit Oct. 20 in a U.S. District Court in Alabama alleging that U.S. Central forced it to buy $9 million in paid-in-capital shares in U.S. Central several weeks before NCUA required U.S. Central to write down its mortgage-backed securities by $1.2 billion and injected $1 billion into the corporate (Kansas City Star Oct. 26). Three months after Corporate America CU bought the securities, federal regulators placed U.S. Central into conservatorship.

ABA convention attracts 5000 bailout protesters

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CHICAGO (10/29/09)--About 5,000 demonstrators from 20 states marched on the American Bankers Association convention in downtown Chicago Tuesday to express frustration with the banking industry's lack of transparency and accountability regarding $350 billion in federal bailout money. The protestors included union members, community activists and taxpayers from 48 groups, including the Service Employees International Union (SEIU) and the AFL/CIO. The march culminated three days of demonstrations demanding that banks stop lobbying against financial reform, end extravagant executive bonuses and halt home foreclosures that are ruining neighborhoods across the nation, said participants (PRNewswire and The Christian Science Monitor Oct. 27). They also picketed the Chicago offices of Goldman Sachs Inc. and Wells Fargo & Co., and demanded that banks "end their over-reliance on greed and profits, and commit to using their taxpayer bailouts and backstops to help America's economy recover," said an SEIU press release. Attendees at the ABA convention told The Wall Street Journal (Oct. 27) that the anger is misplaced and should not be directed at the group since ABA represents mostly community banks. A spokesperson for ABA issued a statement that said "bankers want smart regulation" and look to the government to fill the "gaps in the regulation of non-bank lenders," said the Christian Science Monitor. The events kicked off Sunday with a gathering of hundreds of individuals who have lost their homes, jobs and pensions during the economic crisis. On Monday, Federal Deposit Insurance Corp. (FDIC) Chair Sheila Bair addressed nearly 1,000 of the group and reaffirmed her support for the proposed Consumer Financial Protection Agency (Reuters Oct. 27).

Suze Orman site Look at CU credit card options

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MADISON, Wis. (10/29/09)--Personal finance expert Suze Orman is urging consumers to look into credit union credit cards as an alternative to the credit cards offered by large banks. “I think what many of the major banks are doing to their credit card holders is a travesty,” Orman says on her website, referring to the high fees and rates that some charge. “To fight back, I want all of you to look into credit union credit cards as an alternative.” Orman’s website also features a blog posting by Ondine Irving, founder of Card Analysis Solutions. The posting is listed under “The Suze Scoop.” “Your best bet is to get a credit card from a credit union that owns its own program,” Irving writes. Of the roughly U.S. 8,000 credit unions, about half have their own card programs, she said. “I am strongly opposed to credit unions selling their card portfolios to banks,” Irving added. “But in all fairness, some credit unions needed capital to either build new branches or utilize the funds for other purposes.” Credit unions offer the following with their cards, according to Irving:
* Fixed interest rates ranging from 7.95% to 17.95%, based on FICO scores. Federally chartered credit unions cannot charge more than 18%; * Late fees of $20 to $25 with a five-day payment grace peiod; * No penalty annual percentage rates (APR); * No separate cash advance or balance transfer APRs; * No annual fees; and * Generous rewards programs, including points that can be redeemed on any airline with no blackout dates.
For more information, use the links.

Oklahoma league opens CU House

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OKLAHOMA CITY, Okla. (10/29/09)--More than 100 credit union professionals, volunteers and partners gathered to mark the official grand opening of Oklahoma Credit Union House Friday in Oklahoma City. The day, Oct. 23, also marked the Credit Union Association of Oklahoma’s (CUAOk) 75th anniversary.
Click to view larger image More than 100 people gathered at the official grand opening of Oklahoma Credit Union House Friday in Oklahoma City. Among them were, from left: Aaron Owen, Miller Tippens Construction; Doug Aldrich, building committee, Tulsa (Okla.) Teachers CU; Gary Bartley, building committee, Credit Union Service Centers; Gina Wilson, board of managers, Oklahoma Central CU, Tulsa; Michael Kloiber, board of managers, Tinker FCU, Oklahoma City; Kelly Diven, Board of Managers, 66 FCU, Bartlesville; Steve Rasmussen, chairman, CUAOk board of directors, FAA CU, Oklahoma City; DJ Morrow Ingram, president/CEO, CUAOk; Brent Taylor, board of managers, WEOKIE CU, Oklahoma City; Whit Todd, architect, kinslow, keith & todd; and Bill Lavin, building committee and board of managers, Credit Union One of Oklahoma, Oklahoma City. (Photo provided by the Credit Union Association of Oklahoma)
“This is a historic day for the Oklahoma credit union movement and our association,” said Kelly Diven, chairman of the board of managers for Oklahoma Credit Union House and president/CEO of 66 FCU, Bartlesville. “It perfectly symbolizes the cooperative nature of credit unions and our partners.” Twenty-four Oklahoma credit unions gathered to create the limited liability corporation that built Oklahoma Credit Union House, Diven told the crowd. The 8,300 square foot building is debt-free and serves as a meeting and training facility for Oklahoma credit unions and houses CUAOk, formerly the Okahoma Credit Union League. Oklahoma Credit Union House is one story and features a mezzanine with a balcony that boasts a view of Oklahoma’s State Capitol building located about six blocks away. On the main floor is a meeting room that features state-of-the art technology that can accommodate 100 people classroom-style and is divisible by a movable wall. The association’s board room can accommodate a meeting of up to 30 participants. The mezzanine offers a meeting area. The entire building has wireless Internet access. “Our close proximity to the State Capitol serves to underscore the importance of advocacy to our association,” said Steve Rasmussen, chairman of the CUAOk board of directors. “We will hold our annual State Government Affairs Legislative Reception here and will no doubt host many other legislative-related events and meetings.” Along with the 24 investor credit unions, a number of credit union partners and individuals invested in naming rights to rooms in the facility. DJ Morrow Ingram, president/CEO of CUAOk, said there are a few remaining naming rights opportunities available. A paving brick program--where individuals or companies can purchase an engraved brick to be installed on the flag plaza--is ongoing. In her remarks to the crowd prior to the ribbon cutting, Morrow Ingram said: “This house is your house. It will long serve as a powerful visual reminder that Oklahoma credit unions and the millions of members that they serve are an important piece of Oklahoma’s commerce and one that will be a part of the political, business and consumer scene for a long time.”

New Mexico CUs to launch Savings Revolution

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ALBUQUERQUE, N.M. (10/29/09)--The Credit Union Association of New Mexico (CUANM) was awarded a $40,500 grant from the National Credit Union Foundation to launch a statewide Savings Revolution challenge.
Kathy Darwin, REAL Solutions consultant for the Credit Union Association of New Mexico (CUANM), and Mike Athens, CUANM vice president of association services, look over a $40,500 grant from the National Credit Union Foundation to launch a statewide Savings Revolution challenge. (Photo provided by Credit Union Association of New Mexico)
The year-long Savings Revolution is like Weight Watchers for your wallet, said Mike Athens, CUANM vice president of association services (CUANM Network October). The program allows people to overhaul their financial lifestyles to save money and reduce debt with strategies supported by their credit union collaboration. The New Mexico challenge is the first statewide challenge, with six credit unions participating, Athens added. “It comes under the umbrella of REAL Solutions to reach out to low-wealth individuals, new Americans and youth,” he said. “Players will have financial issues and will benefit from the challenge.” The winner will receive a cash prize. The savings challenge targets families or individuals chosen by the six participating credit unions, although other members can get involved, said Kathy Darwin, REAL Solutions program coordinator for CUANM. The Savings Revolution has two main components:
* A savings challenge in which about 15-18 selected credit union members will compete to achieve defined savings and debt reduction goals, and build their credit. The participant(s) most closely reaching or exceeding their financial goals win the competition and receive a cash prize. * In the meantime, through online communications and other channels, other members can take the challenge using the same techniques. One goal is to have members network to set goals, share notes with those facing similar challenges and see how others respond to those challenges.
Participating credit unions are:
* Chino FCU, Silver City; * LOCO CU, Alamogordo; * High Plains FCU, Clovis; * Guadalupe CU, Santa Fe; * Everyone’s FCU, Tucumcari; and * Rio Grande CU, Albuquerque.
Each family or participant will have a credit union coach who will meet with them monthly to advise them, monitor progress and help them adjust their plans along the way, Darwin said. An outside accounting firm will tally the final numbers, looking for reduction in debt and an increase in savings and credit scores to find the winner. “This is a fun way to help entire communities learn more about financial literacy and managing their finances as they do the same thing the contestants will be doing: reducing debt, and building their credit,” Darwin said.

Panama CUs learn advocacy benefits from Iowa league

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DES MOINES, Iowa (10/29/09)--Advocacy and legislative activities topped the agenda for Panamanian credit union and trade association representatives who last week visited their counterparts at the Iowa Credit Union League (ICUL). The visit was part of World Council of Credit Unions’ (WOCCU) International Partnerships Program.
Click to view larger image A delegation from Panama recently met with representatives from the Iowa Credit Union league (ICUL). From left, are Murray Williams, ICUL chief operating officer; Leonor Samudio, COFEP board secretary; Thom Belekevich, World Council of Credit Unions consultant; Jacinto Villarreal, COFEP CEO; Patrick Jury, ICUL president/CEO; and José Montenegro, COFEP chair. (Photo provided by World Council of Credit Unions)
Representatives from the Corporación Fondo de Estabilización y Garantía de Cooperativas de Ahorro y Crédito de Panama, R.L., known as COFEP, met with the league to better understand and apply advocacy, and gain ideas for new products and services for Panamanian credit unions. Effective lobbying can be challenging in many Latin American countries, including Panama because interactions with government officials are often seen as signs of corruption or under-the-table dealings. COFEP sought ICUL’s advice on ways to keep legislative activities transparent and leverage member needs to positively influence legislation. “In the U.S., credit unions have found advocacy to be a vital component of our movement's success,” said Patrick Jury, ICUL president/CEO. “Everything credit unions do is impacted by the political process, so we must have a strong collective voice. Our goal is to help Panama’s credit unions feel more comfortable in this process and create more urgency in their engagement with elected officials.” The delegation from COFEP, which began its WOCCU partnership with ICUL in 2006, included José Montenegro, chairman; Leonor Samudio, board secretary; and Jacinto Villarreal, CEO. The meetings helped determine how different products and services offered by ICUL and its subsidiaries might be adapted for use in Panama. Also, the delegation studied cooperative business lending, matched savings programs using individual development accounts and ways to reach underserved populations. The delegates met with Iowa Corporate Central CU representatives to discuss CD Access, a liquidity product. CD Access is a mechanism that credit unions needing liquidity can use to buy certificates of deposit from credit unions with excess liquidity. The group discussed Iowa credit unions’ success with investing in certificates of deposit at other institutions and how that process could work in Panama. COFEP delegates will present a CD Access to their board of directors and may engage ICUL in a webinar early in 2010 to promote the product. The delegates also toured Iowa’s Capitol and visited 1st Gateway CU, Camanche, and EdCo Community CU, Des Moines. Pat Drennen, 1st Gateway president/CEO and ICUL chair, discussed the credit union’s goals for its products and services. 1st Gateway aims for each member to use 2.8 products and/or services by the year-end, Drennen said. The credit union also analyzes service popularity for future planning. The visit concluded with a planning session in which COFEP, ICUL and WOCCU mapped the next steps for the partnership in 2010. These steps may include a translated webinar on CD Access and/or cooperative business lending, a credit union-to-credit union partnership and a return visit to Panama by an ICUL delegation.

Wings Financial takes flight to diversify membership

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APPLE VALLEY, Minn. (10/29/09)--Wings Financial FCU, which has primarily served employees of the airline industry, has taken flight to serve a larger and more diverse membership in the Midwest. Wings Financial FCU, the largest credit union in Minnesota with $2.2 billion in assets, now serves individuals in 13 counties near the Twin Cities. It also can serve members in St. Croix and Pierce counties in Wisconsin (Star Tribune Oct. 26). Apple Valley-based Wings, which is one of the U.S.’s largest credit unions, has 18 branches nationwide. Many are located in airports to serve those working in the air transportation industry, the newspaper said. Mark Cummins, president/CEO of the Minnesota Credit Union Network, told the Tribune that credit unions--like Wings--that once served a narrower group of individuals may have asked themselves, “Is there going to be a nucleus of people within this one group that allows us to continue to offer services to a level that we want to be able to provide to our members?” The credit union, chartered in 1938 to serve Northwest Airlines workers, serves employees of 30 air transportation companies--including 54 airlines--and has 123,000 members, the newspaper added. Wings’ latest partnerships include JetBlue, Colgan and SunCountry airlines. The credit union also received significant media attention when it attempted to take over Continental FCU, El Segundo, Calif. in 2007. Continental’s board of directors rejected the merger proposal (News Now March 22, 2007).

CUs root for their World Series teams

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HARRISBURG, Pa. and HIGHTSTOWN, N.J. (10/29/09)--Word Series mania has hit Pennsylvania and New York, and one state is caught in the middle--New Jersey. One credit union has embraced this rivalry by creating a World Series-themed fundraiser that will benefit children’s hospitals.
Hamilton Horizons FCU, in Hamilton Township, N.J., has created a fundraising opportunity that embraces the rivalry between its members regarding the World Series, which kicked off Wednesday night in Yankee stadium. For each dollar donated to the Children’s Miracle Network, the credit union will place a baseball under the donator’s favored team--the Philadelphia Phillies or the New York Yankees. (Photo provided by Hamilton Horizons FCU)
Hamilton Horizons FCU, located in Hamilton Township, N.J.--which is in the middle of New York and Pennsylvania--has created a fundraiser that will run throughout the series. For each dollar a member donates to Children’s Miracle Network, the credit union will place a red Philadelphia Phillies or blue New York Yankees baseball on the wall of the credit union under the team of the donator’s choice. The funds raised will be split evenly between Children’s Hospital of Philadelphia and Children’s Specialized Hospital in Brunswick, N.J. The New Jersey Credit Union League’s 2009 Turnpike World Series predictions indicate that the state’s bets on the series are split. About half--52.2%--said New York will win in six games. Another 21.7% predict New York will win in five. Roughly 8.7% predicted Philadelphia will win in six games, and another 8.7% think the team will win in seven. New York was predicted to win in seven games by 4.3%, and Philadelphia in five by 4.3% (Weekly Update Oct. 28). The series, which kicked off Wednesday night in Yankee Stadium, also has inspired a bet between credit union association CEOs in the teams’ states. Pennsylvania Credit Union Association (PCUA) President/CEO Jim McCormack and New York Credit Union Association President/CEO Bill Mellin have bet placed on the winning team that will leave one of them wearing either blue or red pinstripes. The loser will wear the color of the winning team at the Credit Union National Association’s Governmental Affairs Conference in February (Life is a Highway Oct. 28).

CU System briefs (10/28/2009)

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* OGDEN, Utah (10/29/09)--A nineteen-year-old was sentenced to 45 days in jail and ordered to pay restitution of nearly $10,000 for her part in a check-kiting scheme against three credit unions. Britney Kylie Thorp is one of four young women charged since June with communications fraud for opening checking accounts with bad checks. She was ordered to pay more than $4,592 to Weber CU, Riverdale, Utah; more than $4,006 to America First CU, Ogden; and more than $959 to Mountain America CU, West Jordan. The defendants allegedly used the funds to pay bills and cover expenses as opposed to buying big-ticket items, said police. Others charged included sisters Kelli Ann and Kari Marie Foprd, 19 and 20, respectively, and Jessica Ann Richardson, 21, of West Valley City. Their cases are pending. Richardson pleaded guilty earlier this month and will be sentenced Nov. 18 (Standard-Examiner Oct. 28) … * ST. LOUIS, Mo. (10/29/09)--A gym full of children counted down 3-2-1, the scissors cut the ribbon, and Gateway Metro FCU of St. Louis
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opened its second student-assisted branch in an elementary school, this time at St. Ferdinand School in Florissant. At the opening, Gateway Metro President David Barton spoke to students from all grade levels about the importance of saving and the impact the new branch will have on their school. Here, credit union staff and students cut the ribbon on the new branch, which will open every Thursday from 11:30 a.m. to 1 p.m. Students will be entered in a drawing for a $50 Target gift each time they deposit $5 in their credit union account. In 2006, the credit union opened its first student branch at Our Lady of Guadalupe School. (Photo provided by Gateway Metro FCU) … * WICHITA, Kan. (10/29/09)--Beginning this week, Wichita's Southeast High School students can open a savings or checking account, use their debit card or apply for a 0% interest laptop loan at school through Credit Union of America's new Buffalo Branch. The branch is named for the school's mascot. It is the first financial institution branch inside a Wichita high school (The Wichita Eagle Oct. 28). Credit union President Bob Thurman told the newspaper he hopes the branch will help students establish credit by teaching real-world skills such as balancing a checkbook and paying bills on time. Students 15 and older can open a savings account with $5. Most other accounts require a signature from a guardian or parent. Students 16 and older can open a checking account without a co-signer if they complete an online tutorial and pass a test … * RALEIGH, N.C. (10/29/09)--State Employees' CU (SECU) members, through the SECU Foundation, have pledged $500,000 to the Vital Connections Capital Campaign for the expansion of the Hospice and Palliative CareCenter (HPCC) in Winston-Salem. HPCC will use the funds to add a Palliative Care Clinic and a new 10-bed wing to the Kate B. Reynolds Hospice Home, increasing the number of beds to 40 …

CU System briefs (10/27/2009)

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* TULSA, Okla. (10/28/09)--A man who hid in the bushes until an employee of Oklahoma Members First FCU arrived for work robbed the $21 million asset, Tulsa-based credit union Thursday, said police. When the employee opened the door, the masked man jumped out and pressed an object that felt like a gun to the employee's head and forced her inside. He stole money from the vault and fled. Police found pieces of a broken replica gun inside the credit union (Associated Press Newswires (Oct. 22) … * KAUNAKAKAI, Hawaii (10/28/09)--A former teller pleaded guilty of embezzling $218,293 from the Molokai Community FCU, based in Kaunakakai, Hawaii. Daniel K. Mahiai, 32, of Molokai, pleaded guilty to one count of embezzlement by removing funds from his teller's drawer. He replaced $55,982 before the thefts were discovered, said the U.S. attorney's office. Mahiai covered up the theft by making false entries in members' accounts and placed some accounts on "no mail" status, which prevented the credit union from sending members' statements reflecting the withdrawals. He faces a maximum 30 years in prison and a fine of up to $1 million (Honolulu Advertiser Oct. 24) … * ALLENTOWN, Pa. (10/28/09)--Two men were sentenced to prison for their roles in a Sept. 17, 2007, robbery of First Class FCU, Allentown, Pa. Asharif Tansmore, 36, of Philadelphia, and Terrance T. Meitzler, 31, of Allentown were sentenced Oct. 20 to three to six years each in state prison after pleading guilty to robbery and criminal conspiracy to commit robbery. They also were ordered to pay more than $67,000 in restitution. Three other co-defendants received prison sentences earlier: Adrian Galsgow, 32, sentenced to five to 10 years in prison; Chris Mason, 33, sentenced to 5 1/2 to 11 years; and Gregory Brown, 37, sentenced to seven to 14 years. During the holdup, one robber struck the credit union CEO on the head with what was believed to be a gun. Brown's sentence also involved charges of holding up Paragon FCU, Bethlehem, Pa., on Nov. 7, 2006. (Allentown Morning Call (Oct. 21) … * RICHARDSON, Texas (10/28/09)--Texans CU has received the 2009 Employers for Education Excellence (EEE) Gold Award from the Texas State Board of Education. The award honors employers who implement a policy to encourage and support employees actively participating in school activities. Texans CU won based on its employee dedication and commitment to Junior Achievement. The award will be presented during the November State Board of Education meeting in Austin. During the past three years, more than 100 employees have affected the lives of at least 3,200 students by teaching the Junior Achievement curriculum in the classroom. They logged nearly 650 total hours in the classroom, plus an additional 650 hours of travel time to and from the schools … * SOUTH BOSTON, Va. (10/28/09)--Rev. William J. Coleman has been hired as the new president/CEO of Tri-County Community Action Agency Inc. and Halifax County Community FCU, a $9 million asset credit union in South Boston, Va. He began his duties on Oct. 19. Coleman replaces William E. Coleman, who served as president/CEO for more than 42 years before retiring this fall. The newly appointed Coleman has worked in several top management positions, including as CEO of his own accounting firm. He most recently served as human resources director of a retirement community in Lynchburg, business auditor for the Campbell County Commissioner of Revenue's office and as finance officer for the Southside Community Services Board in South Boston. He has served as a member of the board and chairman of the delinquent loan committee of Lynchburg-based Beacon CU. The two Colemans are not related (Gazette Virginian Oct. 26) …

Sacramento CUs on leading edge with scanned deposits

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SACRAMENTO, Calif. (10/28/09)--Two credit unions in Sacramento, Calif., are on the leading edge in the field of check/share draft deposits, according to a local newspaper. Earlier this month, Sacramento-based Schools Financial CU announced its new service allowing members to scan checks at home and deposit them into their account via the Internet. The service requires the member to have a digital scanner and a computer with an Internet connection. Another credit union, Golden 1 CU, introduced scanner-based check deposits in July (The Sacramento Bee Oct. 26). Its Z@piT online deposit service has about 200 members enrolled. The service appeals to people who prefer self-service--such as parents with small children or those who don't want to visit an ATM at 3 a.m., Golden One CEO Teresa Halleck told the newspaper. Schools Financial CU included safeguards in its program to prevent abuse of the check depositing system. Members must use their secure online banking log-in, and they are limited to two transmissions a day. Users have a time limit in which to scan and deposit the check online, and checks must meet specific requirements before being "deposited." Post-dated, damaged or lightly printed checks that don't scan properly can't be deposited, the credit union told the newspaper. Its service, which is being rolled out gradually, will be available to all members who bank online by mid-November. The article also noted that a savings bank in the area is allowing its customers to deposit checks with their iPhones by taking photos of both sides of the check with the phone's camera. More than 100,000 checks totaling $61 million have been deposited via iPhone since August.

Maryland official supports fin lit graduation requirement

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COLUMBIA, Md. (10/28/09)--Maryland Comptroller Peter Franchot announced his support for a standalone financial literacy course as a high school graduation requirement, a goal supported by the Maryland and District of Columbia Credit Union Association (MDCCUA). Franchot made the announcement at a Maryland Board of Public Works meeting on Oct. 21. The board consists of Gov. Martin O'Malley and state Treasurer Nancy Kopp, both of whom were present at the meeting, said MDDCCUA (Focus Newsletter Oct. 26). Franchot noted that the "principles of financial literacy are essential building blocks to a lifetime of economic security, and are every bit as vital to a good education as reading, writing and math. Financial literacy needs to be taught in our schools." Dr. Charlene Dukes of the Maryland State Board of Education (MSBE) updated the public works board on the progress of the State Task Force on Financial Literacy, especially MSBE's plan to develop a K-12 state curriculum for local use. MSBE hopes to present a draft curriculum to local school superintendents by December. MDDCUA has been active in its support for financial education, saying it believes financial education should be promoted within Maryland's schools. It is a member of the Maryland Coalition for Financial Literacy and its CEO, Mike Beall, is a member of the coalition's Executive Committee. Other credit union community members of the coalition include Rob Windsor, CEO, First Financial FCU; Richard Webb, CEO, Atlantic Financial FCU; Dorothea Stierhoff, senior public affairs specialist with MECU; and Kalimah Mathews, business development manager, Signal Financial FCU. The task force has created two subcommittees, both with credit union input. Chris Conway, MDDCCUA board member and CEO of Educational Systems FCU, is a member of the Advisory Committee, and Brian Tate, MDDCCUA vice president of legislative affairs, is a member of the Design Committee.

Biz Kid beats out Disney Nickelodeon for green award

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SEATTLE (10/28/09)--Biz Kid$, the youth-focused and credit union-funded financial education show on public television, received the Environmental Media Award in the category for Children's Live Action Monday, beating out shows from Nickelodeon and Disney. Biz Kid$ won for its episode, "The Green Economy & You," which first aired on March 5. The episode teaches kids how businesses can go "green" and includes stories of young entrepreneurs, such as a 12-year-old who sells eco-friendly lunch bags. Also nominated in the category were Disney's Suite Life on Deck and Nickelodeon's iCarly. Biz Kid$ Executive Producer Jamie Hammond was thrilled to be singled out by the only awards program devoted to celebrating the entertainment industry's creative environmental efforts. "The other shows in the category are so great. We are truly honored," Hammond said. The award, presented by the Environmental Media Association (EMA) during its 20th anniversary awards ceremony, recognizes the live action children's show that best increases public awareness of environmental issues and inspires personal action on these issues. "Biz Kid$ is all about educating children about the importance of planning and responsibility. These lessons are as pertinent to financial success as they are to environmental awareness," Hammond said. Earlier this year, Biz Kid$ was honored with an Emmy Award and the credit union industry's Herb Wegner Award. Washington Credit Union Foundation Director RoxAnne Kruger helps oversee exclusive underwriting of the first three seasons of Biz Kid$ by America's Credit Unions, a coalition of nearly 200 credit unions, credit union foundations, non-profits, service providers and individuals. "From this show's inception, credit unions understood what a powerful resource it could be for educating youth. We couldn't be happier that others are seeing that value, too," Kruger said. The program, which is filmed in Seattle, began airing its second season nationwide in January. It is available to 97% of public television stations.

IUSA TodayI reports on CUs save-for-college efforts

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WASHINGTON (10/28/09)--A USA Today article published Tuesday noted credit unions’ efforts to help parents and youth save for college in a turbulent economy. The article, “Banks, credit unions offer help saving for college,” mentioned Justice FCU, Chantilly, Va., and Grow Financial FCU in Tampa for their college savings efforts. Justice offers a discount on loans to pay for college. Grow is donating money to student scholarships based on a local college football team’s “return yards”--which is how far a football player runs after receiving a punt or kick (USA Today Oct. 26). Peter Sainato, CEO of Justice FCU, also told the newspaper that “everyone is feeling the stress of the economic downturn” and that many college savings account values have decreased. “We are trying to help people through this difficult time,” he added. Justice FCU has $477 million in assets. Grow Financial FCU has $1.7 billion in assets.

CUs host holiday webcasts for troops families

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SAN DIMAS, Calif. (10/28/09)--Families with loved ones stationed overseas in the military can send holiday greetings through the credit union-supported Operation Best Wishes program, which kicked off Monday and will continue for eight weeks.
Western Corporate FCU (WesCorp) is again sponsoring Operation Best Wishes so families and individuals can send greetings to family stationed overseas in the military. Here, Joe Keller (left) of WesCorp, adjusts a video camera to record a video greeting at Langley FCU, Newport News, Va., where the program launched Monday. (Photo provided by Western Corporate FCU)
The program was launched at Langley FCU in Newport News, Va. Western Corporate FCU (WesCorp) of San Dimas, Calif., has a team that will travel nationwide to visit 17 credit unions in 15 states to help family members send greetings. A record number of credit unions are participating this year. WesCorp expects to send about 960 webcast recording sessions to 2,700 soldiers. Each credit union in the program will set up a mobile webcast studio with cameras, microphones and monitors to record the greetings. There is no cost, and greetings have an allotted time of 10 minutes. Some recipients will receive the greetings live and can text messages back to the studio. Operation Best Wishes is supported by each participating credit union and the Defense Credit Union Council, an organization of credit unions whose membership comprises U.S. Department of Defense personnel. Although troop withdrawals continue in Iraq, there’s still a strong interest to support soldiers who are deployed in other areas during the holidays, according to Walt Laskos, WesCorp public relations director and Operation Best Wishes manager. “It’s particularly interesting to see how several of the bases we will visit have already fully booked their recording sessions, doing so much earlier than in previous years,” he said. “Obviously the need is clearly there and families are responding to credit union invitations.”

Private insurer Cumorah acquisition benefits both CUs

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DUBLIN, Ohio (10/28/09)--Credit Union 1's acquisition of Las Vegas-based Cumorah CU is positive because it joins two organizations that can benefit from each other, according to the CEO of Cumorah's private share insurer. Cumorah was closed Friday by state regulators and its assets and deposit shares were assumed by Credit Union 1, Rantoul, Ill. American Share Insurance (ASI), a private share insurance company in Ohio, is Cumorah’s liquidating agent. “I think [the merger] is a good move,” Dennis Adams, CEO of ASI, told News Now. “The right steps were taken to preserve the credit union movement in Nevada and to preserve member service [at the credit union].” The "marriage" between the two organizations will give the credit unions an opportunity to collaborate using each other’s strengths. For instance, while Credit Union 1 specializes in more traditional lending, like auto loans, Cumorah focuses on mortgages. The move will also help them diversify risk, Adams said. “They can play off each other in a positive way,” he added. Paul Simons, CEO of Credit Union 1, agreed that the acquisition was a good opportunity. “It’s a great way to diversify what we do in Illinois,” he told News Now. “There’s a lot of opportunity [for both credit unions].” Simons was appointed interim CEO at Cumorah before the announcement was made that the $574 million asset Credit Union 1 would take over Cumorah’s deposits and assets. He said Cumorah experienced delinquencies in its commercial real estate (CRE) loans. Cumorah is a very well-run credit union that had successfully done commercial real estate lending for years, Simons emphasized. But when the housing market collapsed in Nevada, the credit union suffered losses. On Monday, when local news outlets reported that Cumorah had been closed, members called staff at the credit union to find out what happened. Call volume and branch volume were higher that day, but by 11 a.m., all was “back to normal,” Simon said. “[The members] are fine.” It’s also important that the term “Cumorah” is kept in the credit union’s name. Cumorah is currently being referred to as a “division of Credit Union 1,” Simons said. One change that Cumorah members will see involves rate structures. Credit Union 1 members, regardless of their location, pay the same rates on products and services. Nevada’s rates are currently depressed because of a struggling state economy. When the rate pricing structure is adjusted at Cumorah to match Credit Union 1’s rates, Cumorah members will benefit, Simons said. Credit Union 1 doesn’t engage in business lending and doesn’t plan to in Nevada. It will stick to single-family mortgages and auto loans, Simons said. Several out-of-state credit union acquisitions have taken place recently--such as Alaska FCU’s acquisition of High Desert CU in Apple Valley, Calif. Simons said his credit union's acquisition of Cumorah occurred under unique circumstances. “I don’t see in the future that it will be prevalent,” Simons said. “It’s a window of opportunity that closes." Despite Cumorah’s failure, ASI’s Adams said its insurance funds remain strong. While any loss event will deplete reserves, ASI’s group equity ratio will remain in a “good range,” Adams said. As of June, ASI insured 157 credit unions in nine states: Ohio, Indiana, Illinois, Idaho, Nevada, California, Texas, Alabama and Maryland. The Credit Union 1 and Cumorah acquisition is ASI’s first. Cumorah is the third credit union in Las Vegas to fail this year and the first privately insured Nevada credit union to be closed since the nation's financial crisis began (Las Vegas Review Journal Oct. 24). Cumorah, with $147 million in assets and $129 million in deposits, has 60 employees, two offices in Las Vegas and two in Henderson (Las Vegas Sun Oct. 23). Credit Union 1 now has 29 branches--four in Nevada, 23 in Illinois, and two in Indiana.

Public funds legislation introduced in Ohio

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COLUMBUS, Ohio (10/28/09)--As expected, legislation was introduced Oct. 16 in the Ohio House of Representatives to allow Ohio credit unions to be eligible depositories for public funds under state law. House Bill 317, jointly sponsored by Majority Floor leader Tracy Heard (D-Columbus) and State Rep. Peter Ujvagi (D-Toledo) and 20 additional co-sponsors, would include credit unions as eligible depositories for the state, communities, schools and other public systems (InfoSight Compliance eNewsletter Oct. 26). The bill also would allow credit unions to participate in the Ohio Department of Development’s Minority Business Enterprises Program and Capital Loan Program for small businesses. Under the provisions of H.B. 317, members would have access to linked deposit programs from the Ohio Treasurer through their credit union. “The ability of credit unions to participate in these programs would benefit the citizens, businesses, communities and public entities in Ohio,” said John Koslowski, general counsel for the Ohio Credit Union League. This is the second time the league has tried to pass legislation so credit unions can accept public deposits. The last attempt was in 2004. The league wants to help credit unions accept public deposits because many local communities, schools, municipalities and townships have come to the state’s credit unions looking to do business, the league said (News Now Oct. 19).

New York league president testifies at state hearing

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ALBANY, N.Y. (10/28/09)--Credit Union Association of New York President/CEO William J. Mellin testified on behalf of the credit union community at a state Assembly Banks Committee hearing Friday in New York City.
Credit Union Association of New York President/CEO William J. Mellin testifies on behalf of the credit union community at a state Assembly Banks Committee hearing Friday in New York City.
The hearing was called to determine what level of regulatory authority the state should exercise to protect its financial service entities and consumers. Also addressed was the possible enactment of federal legislation that would create a new Consumer Finance Protection Agency. Others testifying included Richard Neiman, superintendent of the state Banking Department and Michael Smith, CEO of the state bankers association. During his testimony, Mellin emphasized the unique and important role New York credit unions play in the financial services marketplace and their ability to help New Yorkers recover from the current economic challenges. He also reminded the committee that credit unions' cooperative, not-for-profit structure and mission of creating financial independence for their members prevented them from contributing to last year's financial crisis. "Credit unions take great pride in truly knowing their members," Mellin said. "As a result, our mortgages are not packaged and overseen by an institution in a far-off state. In fact, many of our institutions hold substantial mortgage portfolios. It is not a coincidence that credit unions have been lauded as the example of what is right with the financial services industry throughout this downturn in the economy," he added. When asked about the future of the dual chartering system, Mellin said "the dual regime of state and federal regulators, as well as charter choice, allows for competition, diversity and innovation--elements that remain critical for our state's consumers and financial institutions." He also referenced President Barack Obama's March 2009 recommendations to Congress (Financial Regulatory Reform: A New Foundation) and encouraged the committee to reaffirm those recommendations. In the report Obama recognized the value of credit unions' dual chartering system and recommended maintaining state supervision, dual chartering and an independent credit union regulator. "While there is no question that enhancing consumer protection is a laudable goal given the economic climate, it must be accomplished in a manner that builds on existing regulatory success without undue regulatory burden for financial institutions," Mellin concluded. After his testimony, he said, "The hearing was an excellent opportunity to again highlight the credit union difference and how we are helping millions of New Yorkers in communities across our great state."

Iowa foundation homeowner ed receives state award

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DES MOINES, Iowa (10/28/09)--The Iowa Credit Union Foundation (ICUF) was recognized by state Attorney General Tom Miller and the Iowa Home Ownership Education Project (IHOEP) for ICUF's efforts to provide home ownership education.
The Iowa Credit Union Foundation (ICUF) received an award for its efforts to provide home ownership education from the state and from the Iowa Home Ownership Education Project (IHOEP). From left are Iowa Attorney General Tom Miller, ICUF Executive Director Marybeth Foster, and Stephanie Preusch, IHOEP executive director. (Photo provided by the Iowa Credit Union Foundation)
The recognition was made during IHOEP's Annual Fall Conference in Des Moines. Marybeth Foster, ICUF executive director, accepted the award on behalf of the foundation. The foundation's primary focus is to eliminate poverty in the state by helping Iowans build wealth, responsibility and independence through its programs, grants and scholarships. It offers an individual development account (IDA) program through the state's credit unions. IDAs are matched savings accounts where the depositor's savings are matched by a grant from another organization. The saver earmarks the savings and matching funds to purchase a specific asset--such as a home, a new or expanded business, education or training, or a vehicle to get to work. Participants must meet income guidelines to qualify and must participate in financial education seminars. "Home ownership is the most popular asset choice in the IDA program," said Foster. "The money saved in an IDA can be used toward down payment, closing costs and other fees associated with buying a home."

Members United Corporate reserves 281.5M for more losses

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WARRENVILLE, Ill. (10/27/09)--The September financial statements for Members United Corporate FCU, based in Warrenville, Ill., are much as expected, with the corporate indicated it is recording $281.5 million in capital shares to be available for weathering more potential losses. Members United Corporate released its financial statements for Sept. 30 on Friday. The $7.5 billion asset corporate eliminated its retained deficit that existed in the previous financial statement at the end of August. In accordance with guidance from the National Credit Union Administration (NCUA), the corporate depleted 100% of paid-in-capital and recorded a 40.1% depletion in membership shares. The corporate noted that "both U.S. Central and Members United have not completed their respective investment OTTI (other than temporary impairment) reviews." The report added that results from reviews in process are not incorporated into the financial performance report. "Both reviews are expected to generate additional investment losses which will be recorded and reported in the October financial statements," the report said. "Assuming that these reviews result in a new retained deficit, it is likely that additional depletion will be charged against the remaining membership capital share balances in the month of November 2009," it added. "While the results of the investment OTTI review that is in process are not final and ready for release, management does not anticipate that losses from this review will exceed the remaining $281.5 million of membership capital shares," the report said. Members United, like other corporates, is following NCUA guidance as outlined in Rules and Regulations 704.2 and Letters ot Credit Unions No. 09-CU-10 regarding depletion of capital from the impact of U.S. Central FCU and corporates' own investment OTTI. To access the financial statement, use the resource link.

CU System briefs (10/26/2009)

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* PUEBLO, Colo., and COLORADO SPRINGS, Colo. (10/27/09)--Members of Pueblo, Colo.-based Pueblo City Employees FCU (PCE) voted Friday night to merge with Colorado Springs-based Aventa CU (Gazette Oct. 24). The merger will take place March 1 and result in a combined credit union with nearly $150 million in assets and 18,000 members. PCE will retain its name. It handles accounts, payroll checks and loans for city employees and community members. Aventa CU said the vote was for better financial stability, products and services. Aventa was established in 1957 as Colorado Springs Employees CU … * SARASOTA, Fla. (10/27/09)--Sarasota (Fla.) Coastal CU members were to vote last night on whether to merge with Achieva CU, based in Clearwater, Fla. Sarasota Coastal has $215 million assets while Achieva has $666.8 million in assets.(HeraldTribune.com Oct. 23). Sarasota Coastal has struggled with bad loans and to stay the course would require cuts in service levels and member offerings, while merging with a larger credit union will provide members with what they deserve. Sarasota Coastal board Chair Janet C. Cantees told the Herald Tribune. Achieva said longtime Sarasota Coast CEO Thomas J. Randle would retire and that it will select two Sarasota Coastal directors to join its board. It does not plan to close any of the Sarasota Coastal's five offices but there may be layoffs in duplicated jobs … * WINSTON-SALEM, N.C. (10/27/09)--Winston-Salem (N.C.) City ECU Chief Financial Officer Don Wolford, will take to the skies Wednesday to accompany three World War II veterans--ages 87, 89 and 90 years old--to Washington, D.C., to the World War II Memorial on the Mall, which honors the sacrifices of the "Greatest Generation." Wolford was selected as part of the Triad Flight of Honor, a series of three trips. "I'll be responsible for making sure that the veterans assigned to me have a good trip and have all their needs met," he told the North Carolina Credit Union League, adding that the trio the trip "is an emotional experience for everyone, both at the memorial and then coming back to the airport." More than 1,000 people in Greensboro, N.C. welcomed home a flight earlier this month. The event is part of the Honor Flight Network, conceived by Capt. Earl Morse (USAF-Ret.) in 2005 and has received widespread publicity. Check out the video about the flight

Cumorah CU shuttered by state regulator

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LAS VEGAS (10/27/09)--Nevada state regulators closed Las Vegas-based Cumorah CU Friday night and announced that Rantoul, Ill.-based Credit Union 1 will assume Cumorah's deposits and assets. Cumorah is the third credit union in Las Vegas to fail this year and the first privately insured Nevada credit union to be closed since the nation's financial crisis began (Las Vegas Review Journal Oct. 24). American Share Insurance, a private share insurance company based in Ohio, is the liquidating agent. Credit Union 1 CEO Paul Simons was appointed interim CEO before the announcement was made that the $574 million asset Credit Union 1 would take over the deposits and assets. He said Cumorah's problems began with delinquencies in its commercial real estate loans. Cumorah, with $147 million in assets and $129 million in deposits, has 60 employees, two offices in Las Vegas and two in Henderson (Las Vegas Sun Oct. 23). According to the Nevada Financial Institutions Division, the credit union had inadequate capital and mounting loan losses. In the past 18 months, former CEO Tony Mook said the credit union had laid off 42 of its 101 employees to cut expenses. He resigned Oct. 5 after 19 years as CEO. Members can conduct transactions as usual, with their deposits insured up to $250,000, said the regulator. Other Nevada credit unions to fail this year include Community One FCU, Las Vegas, which was assumed by America First CU, Ogden, Utah, on Aug. 12, and Clearstar Financial CU, Reno, which went to United CU, Mexico, Mo. Three banks also have failed since the year began. In all, nine financial institutions in Nevada have failed since July 2008. Cumorah served 15,000 members of The Church of Jesus Christ of Latter-day Saints. It was established in 1965.

Film director Take your money out of a bank put it into a CU

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DETROIT (10/27/09)--A Michigan filmmaker is encouraging consumers to take their money out of banks and put it into credit unions. Michael Moore, film director, has released a list of 15 things every American can do to fix what Moore considers “a broken system” (The Examiner Oct. 25). Moore just released, “Capitalism: A Love Story.” Since the release of his film, Moore told the newspaper he has been asked by viewers what they can do to help. At the top of Moore’s list of five things Americans can do to protect themselves and their loved ones was to deposit money at a credit union. “Take your money out of a bank if it took bailout money and place it into a locally owned bank or credit union,” Moore said. The controversial film maker has directed movies such as “Roger and Me,” “Fahrenheit 9/11,” “Bowling for Columbine,” and “Sicko.”

INew YorkerI Move to CUs to deal with megabanks

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NEW YORK (10/27/09)--Consumers will have to rise up “en masse” and move their money to credit unions before the market will deal with megabanks’ problems, according to a recent article in the New Yorker. The author, James Surowiecki, noted that big banks--like Wells Fargo, Citigroup, Bank of America and JPMorgan Chase--have even gotten larger, controlling nearly 40% of the country’s total banking deposits and two-thirds of credit cards (The New Yorker Oct. 26). Banks’ growth isn’t because of their customer-friendly philosophy. Instead, they’ve done the opposite by charging higher fees than other institutions. But many customers and clients haven’t moved on because switching from one financial institution to a credit union is often considered a hassle. “A 2001 study showed that the cost of switching a loan came to about a third of the loan’s annual interest rate,” Surowiecki wrote. “Even if people are dissatisfied with their bank, it’s usually cheaper not to fight than switch.” Still, he encouraged consumers to move their money to credit unions. Only then will the market have to deal with the problem of megabanks, which means Washington will then have to deal with them, he wrote.

Robbery stops ICU Day event at CU

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HARRISBURG, Pa. (10/27/09)--An armed man robbed the Lebanon (Pa.) FCU (LFCU) on International Credit Union (ICU) Day, Oct. 15, stopping its ICU Day events. However, the credit union donated hundreds of spray hand sanitizers--originally purchased for members as part of the ICU Day celebration--to local elementary schools, according to the Pennsylvania Credit Union Association (Life is a Highway Oct. 26). The robbery occurred at 9:21 a.m., when a man entered the $136.6 million asset credit union, displayed what appeared to be a handgun and demanded cash from the tellers (Pennlive.com Oct. 16). He placed the cash in a duffle bag and fled on foot. Several members were in the credit union at the time, but no one was injured, according to police (Lebanon Daily News Oct. 15). The robbery closed the credit union, ending all its ICU Day events, which included a live radio broadcast, Italian Ice cart, autographed footballs from Bill Bergey and "lots of food." The credit union board decided area schools could use the hand sanitizers to help fight cold and flu germs. "This is taking an unfortunate event that happened to our credit union and using it to benefit our community," Pat Hain, CEO, said. "Keeping kids and families safe and making our community a stronger and better place is LFCU's goal."

New insurance stems from rising employment liability risks

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MADISON, Wis. (10/27/09)--A 30% spike in employment liability claims paid in 2008 is the catalyst for CUNA Mutual Group’s new Employment Practices Liability (EPL) coverage and risk management offering. Employment Practices Liability insurance is a key part of CUNA Mutual’s new Management and Professional Liability (MPL) policy, which covers credit unions and their staff against alleged violations of federal, state, local and common law related to past, present or prospective employment. These allegations may include discrimination, wrongful termination or workplace harassment, said John Wallace, CUNA Mutual bond and MPL product executive. “Typical compensatory awards range from $100,000 to $500,000, which is conservative because it does not include punitive damages or other awards,” Wallace added. “The recent spike in frequency and severity of employment-related lawsuits is driven primarily by higher unemployment rates.” A prevention-oriented approach combined with modern insurance coverages can help safeguard credit unions from potentially severe financial losses resulting from employment practices litigation, Wallace said. “Our new online risk management resources are prepared by employment litigation specialists and can help credit unions avoid such losses,” he added. CUNA Mutual’s Employment Practices Risk Management program features Web-based resources, including:
* Articles and news briefs; * Employment-practices training modules for credit union staff; * A reference library with papers, checklists, self-assessment tools and links to government websites; and * Model forms and policies.
These online resources will be available after Jan. 1 at no additional cost for credit unions purchasing EPL coverage with their MPL policy. “These specialized risk management tools provide protection beyond the policy for credit unions in response to a very significant and growing loss category for our industry,” Wallace said. MPL is part of CUNA Mutual’s Credit Union Protection insurance and risk management portfolio designed exclusively for credit unions to manage their financial, operational and personal risk exposures. The Credit Union Protection program includes:
* Bond; * Plastic card; * Management and professional liability; * Property and business liability; * Business auto; * Workers’ compensation; and * Plus, additional policies.

Minn. biz mag notes CUs willingness to lend

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MINNEAPOLIS (10/27/09)--A Twin Cities Business article recently explored Minnesota credit unions’ willingness to lend and serve their members despite a tight economy. The article, “Extra Credit,” also included comments from Minnesota credit unions CEOs; Mark Cummins, president/CEO of the Minnesota Credit Union Network; and Mike Schenk, Credit Union National Association senior economist. The overall tone of the article focused on credit unions’ willingness to lend to small businesses and consumers who have been turned away by other financial institutions. “We get a lot of members who say they’re being shut out for business loans,” Jeff Schwalen, Hiway FCU president/CEO, told the magazine. “They may be too small for many banks, or maybe they don’t qualify. We’ll take a look, and for the most part, we’re able to do the loan, assuming they can meet our requirements.” Cummins told the magazine that the state’s credit unions are experiencing deposit growth and continuing loan activity. Credit unions also remain at near-record levels for capital ratios, added Schenk. Credit unions in Minnesota have experienced a drop in net income--to $16.4 million last year from $80.2 million in 2007--because of the housing collapse. However, credit unions’ lending increased by 1.65% in 2008, and total shares and deposits surged 6.85% to $12.2 billion, the magazine said. “We’re not immune to what’s happening in the economy, but in a relative sense, we’re doing very well,” Cummins added. The “really surprising thing to me is, given the heightened correction in housing in the Twin Cities, is that both banks and credit unions seem to be doing pretty well there,” Schenk said. Other statistics the article noted include:
* Real estate loans--mortgage and equity lending--made up 57% of Minnesota credit unions’ total lending of $9.96 billion in 2008; * Credit unions showed an annualized write-off rate on all loans of 0.94%, compared with rates of 1.11% for all U.S. credit unions and 1.94% for banks; * Credit unions had a write-off rate of 1.63% compared with 4.88% of U.S. banks; and * Credit unions’ capital ratio was 10.2% as of March. Seven percent is considered “well-capitalized” by the state.

CU shout out on IToday ShowI

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NEW YORK (10/27/09)--Consumers were encouraged by a finance expert to find credit cards at credit unions on The Today Show Monday during a segment on credit card fees. During the show, Today Show host Matt Lauer interviewed a financial expert--Carmen Wong Ulrich--about credit card fees. Some major credit card companies--such as Bank of America and Citibank, plan to begin charging cardholders fees for inactivity. Lauer asked Ulrich how consumers can avoid paying the fees. Ulrich responded: “About 80% of companies aren’t charging these new fees--especially credit unions. Go to NCUA.gov and you can search Find a Credit Union. No fees and great rates.” To see the video, use the link.

Kenyans flock to rural CU branch

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NZAIKONI, Kenya (10/27/09)--The Universal Traders savings and credit cooperatives (SACCO)--UTS--credit union branch in the mountaintop community of Nzaikoni, Kenya, has experienced a groundswell of interest from members in a community that never had access to financial services. However, the steady member growth over the past 90 days was nothing like the rush during the branch’s official grand opening Wednesday, when a member of Kenya’s parliament pledged her support of the branch by joining UTS and offering to sponsor the initial fees to enroll 20 new members.
Click to view larger image Wavinya Ndeti, a member of Kenya’s parliament, encourages citizens of Nzaikoni, Kenya, to join the new Universal Traders savings and credit cooperatives (SACCO) branch, which is supported by the World Council of Credit Unions.
Click to view larger image A staff member from the Nzaikoni branch of UTS lines up men interested in enrolling in the SACCO. (Photos provided by World Council of Credit Unions)
UTS opened the Nzaikoni branch after several years of support from World Council of Credit Unions’ (WOCCU) SACCO Growth Program in Kenya, funded by the Bill & Melinda Gates Foundation. With WOCCU’s assistance, the small credit union was turned into a regional powerhouse that has attracted involvement from the Kenyan government to administer its agricultural lending program, and establish additional branches, WOCCU said. The rapid rise of membership in the Machakos-based UTS’s fifth branch proved to be a surprise. Residents of the poor community appeared at the small branch during the past few months with jars of money that had been buried in the ground so long that the contents smelled musty. Members hid their funds at home because they lacked the means to take public transportation down the mountain to other SACCOs. “People say it is a miracle that a financial institution has opened here,” said Isaiah Mutungi, chairman of the UTS board. During the grand opening, several officials spoke, including Jesus Chavez, who manages the Kenya SACCO Growth Program. Wavinya Ndeti, an assistant minister in Kenya’s parliament who represents the Kathiani Constituency in which Nzaikoni is located, officially opened the SACCO. She congratulated both the credit union and the community on coming together to provide affordable financial alternatives to people who need them the most. “Thank you for bringing UTS here,” Ndeti said. “These people are the lowest of the low and don't have much. We will judge you by the changes you bring to our people. If I see good results, I promise I will give you 101% support in your efforts.” As a show of faith, Ndeti became a UTS member. She also agreed to sponsor 10 female members and 10 youth members, paying the 100 Kenyan shillings (about $1.20) each to enable them to join. “You can see that the people really need this office,” said Stephen Kisili, UTS general manager. “It has come out very clearly how critical that need is.”

CUs to support National Runaway Prevention Month

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CHICAGO and SAN DIMAS, Calif. (10/26/09)--Financial Service Centers Cooperative Inc. (FSCC), and National Runaway Switchboard (NRS) are partnering again to raise awareness with credit unions nationwide to support National Runaway Prevention Month this November. FSCC is encouraging more credit unions to support the campaign, which aims to raise awareness of issues facing runaway and at-risk youth, and educate Americans about solutions and the role they can play in preventing youth from running way. “The youth of today is our future,” said Sarah Canepa Bang, FSCC president/CEO. “As community leaders and more importantly, as parents, we need to find ways to help prevent youth runaway. The ‘Answering the Call’ campaign serves as a great way to spread the word on youth runaway and gain more awareness and support through credit unions and their members. “This is an awareness campaign that can be supported by simply putting up a flyer at the credit union,” she added. “The credit union movement has a long history of helping children and youth. We hope more credit unions will open their hearts to this worthy cause.” NRS receives an overwhelming amount of requests for help with calls coming in from across the country, said Maureen Blaha, NRS executive director. “While NRS handles more than 100,000 calls a year, youth issues can be very complex,” Blaha said. “We find that family dynamics is the most frequent problem identified by crisis callers. Youth run away from home for many reasons but our job is to help keep them safe and off the streets.” FSCC and NRS urge credit unions to participate in the campaign by using the promotional materials that highlight the campaign. Materials can be used inside credit union branches and lobbies to show support. A community action kit is also available, which includes activities that can be used to help raise awareness and provide solutions that prevent youth from running away. These materials can be downloaded on the NRS website at www.1800RUNAWAY.org and by visiting www.fscc.com or www.cuswirl.com, and clicking on the NRS logo. Family dynamics (divorce, remarriage, problems with siblings) and abuse (substance, physical, sexual, neglect) are the top reasons youth reach out for help, according to NRS call-volume statistics. Research shows that between 1.6 and 2.8 million youth run away per year, and according to NRS’ 2008 call statistics, more than half (51%) of the youth crisis callers were already on the street as a runaway or throwaway, and more than half (56%) said they had been away from home between one and seven days before calling NRS.

Ohio CUs growing during economic downturn

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COLUMBUS, Ohio (10/26/09)--The national economic downturn has allowed Ohio’s 402 credit unions to grow their memberships and make more auto and home loans, according to the Ohio Credit Union league. Credit unions in the state benefited because they continued to make loans when many banks cut back on their lending, the league said (The Columbus Dispatch Oct. 23). “Over the past 18 months, due to the economic stress, a lot of banks have had to build up liquidity and reposition their balance sheet, and this has forced them to curtail lending,” Dave Fearing, league vice president of business services, told the newspaper. “And that provided the perfect opportunity for credit unions to add that needed liquidity to the market.” Credit union membership statewide rose about 30,000 in the first half of 2009 to nearly 2.7 million members, the league added. So far this year, the market share of auto loans for Ohio’s credit unions is 18.4%--up from 12.4% in 2008 and 10.1% in 2007, the league told the paper. Mortgage originations for the first half of this year were $960.5 million--which is 50.2% higher than the 2008 total of $639.5 million. Also, market share is 3.5%--up from 2% at the end of 2007, the league added. “This is the first growth we’ve seen in five years,” Patrick Harris, league director of media relations, told the paper. To view the article, use the link.

Community CUs of the year announced

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LAS VEGAS (10/26/09)--The 2009 Community Credit Union of the Year awards were announced Thursday at the Credit Union National Association’s (CUNA) Community Credit Union and Growth Conference in Las Vegas. The Community Credit Union awards recognize and honor community credit unions that best exemplify the principles of the credit union movement while serving as a positive influence in the field of service. New for 2009, CUNA added a secondary level of recognition as part of the Community Credit Union of the Year Awards--the Award of Merit. The award recognizes the outstanding work being done by credit unions across the country. Award winners in the $250-million-and-below asset category were:
* Archer (Neb.) Cooperative CU, which received the Community Credit Union of the Year Award. Shelly Broekemeier, vice president of operations, accepted the award. * US Community CU, Nashville, which received the Award of Merit. Credit union CEO Cheryl Thompson; Paul Johnson, executive vice president; and Cindy Bubin, senior vice president, accepted the award.
Winners in the $250-million-and-above asset category were:
* Elevations CU, Boulder, Colo., which received the Community Credit Union of the Year award for the same category. Dennis Paul, associate vice president of business and community development, accepted the award. * Shell FCU, Deer Park, Texas, which received the Award of Merit. Angela Head, vice president of information systems, accepted the award.
For more information, use the links.

CU System brief (10/23/2009)

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* HARRISBURG, Pa. (10/26/09)--Pennsylvania State Rep. Peter Daley (D-Fayette) presented the state House of Representatives with a resolution recognizing Oct. 11-17 as Credit Union Week in Pennsylvania. The resolution recognizes credit unions for helping members improve their economic situations and the volunteers who support credit unions and charitable events, said the Pennsylvania Credit Union Association (Life is a Highway Oct. 22). Christina Mihalik, association vice president of governmental affairs, accepted the resolution from Daley (left). Daley is chairman of the state House Commerce Committee. (Photo provided by the Pennsylvania Credit Union Association) ...

Mich. county wants to deposit money in CUs

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MOUNT CLEMENS, Mich. (10/26/09)--A Michigan county has asked its commission’s finance committee for a resolution so the county can deposit money at credit unions, according to a Michigan newspaper. Oakland County, which has an annual budget of $700 million, deposits money into banks through certificates and checking accounts. State law doesn’t prohibit counties from depositing money at credit unions--but doesn’t specifically allow it (Daily Tribune Oct. 23). County Treasurer Andy Meisner told the newspaper that there aren’t a lot of “safe options” available for investments. The move isn’t a “knock on banks,” but the county wishes to “take advantage of any safe opportunity out there,” he told the newspaper. The county’s investment policy is to promote safety, and depositing money in credit unions will allow it to fulfill that, Meisner added. If the county’s finance committee supports the resolution to allow deposits at credit unions, the measure will then move to the full 25-member commission for approval. Meisner said he expects bipartisan support for the measure, he told the paper.

Federation joins Obama to support small biz lending

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LANDOVER, Md. (10/26/09)--The National Federation of Community Development Credit Unions joined President Barack Obama and other elected officials last week to announce their support for small-business lending. “We will make capital even more affordable to the community development financial institutions that focus on providing credit to America's small businesses in our hardest hit rural and underserved communities,” said President Barack Obama at the roll-out of a series of Obama administration initiatives to spur small-business lending. The president’s address was delivered in the warehouse of Metropolitan Archives, a building that this small business (the archives) purchased with the help of a loan from the Small Business Administration (SBA). Dan Mica, president/CEO of the Credit Union National Association (CUNA), also attended the event and followed up Thursday with a letter to President Obama about credit union member business lending. CUNA believes the administration and Congress should support a legislative fix to the member business loan cap as an important step to ensure credit is available to small businesses, which will promote economic recovery, Mica emphasized. The president was joined by Treasury Secretary Tim Geithner, SBA administrator Karen Mills, Maryland Gov. Martin O'Malley; U.S. House of Representatives Majority Leader Steny Hoyer; and other elected officials. Mica and Cliff Rosenthal, federation president/CEO, were among about 60 invited guests at the announcement. Among credit union movement attendees was Bill Bynum, president/ CEO of Hope Community CU/Enterprise Corporation of the Delta (Jackson, Miss) and chairman of the Community Development Financial Institutions (CDFI) Advisory Board of the U.S. Treasury Department. “We believe that many more credit unions will seek certification now, and we are delighted that the CDFI Fund has committed itself to an expedited review process,” Rosenthal said. Community development financial institutions include credit unions, banks, loan funds, and venture capital funds that are certified by the Treasury Department’s CDFI Fund in recognition of their mission and track record of serving low-income and underserved communities. Since its founding in 1994, the CDFI Fund has invested nearly $1 billion in CDFIs. The federation, itself a certified CDFI, has been a leader of the CDFI movement since the early 1990s. While details of the program will be forthcoming at a later date, some key features were announced. For credit unions, CDFI certification will be required. About 150 credit unions are certified CDFIs. The majority of those are federation members. The government’s investment in CDFI credit unions will be in the form of subordinated debt that will count as secondary capital, or regulatory net worth, for low-income credit unions. “We are pleased that the Treasury Department has adopted this structure, and that the proposed rate is 2% for the first eight years,” Rosenthal said. He said that credit unions must have both CDFI certification and low-income designation by the National Credit Union Association (NCUA) to participate. “Only low-income-designated credit unions currently have the power to accept secondary capital, Rosenthal added. “Conversely, low-income designation without CDFI certification will not make a credit union eligible. It's clear that CDFI certification will be a key credential for credit unions in the future, and the federation will continue to provide technical assistance to members seeking certification.” The Obama administration has provided momentum and support to the CDFI movement, more than doubling its appropriation request for the CDFI Fund and providing an additional $100 million in American Recovery and Reinvestment Act "stimulus" funding in the spring of 2009, the federation said. With such bright prospects, the federation said it is adamant in its resolve to expand credit union participation in the high-impact program. For more information, use the link.

WOCCU helps grow Kenyan cooperatives

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TALA, Kenya (10/26/09)--The World Council of Credit Unions’ (WOCCU) SACCO Growth Program in Kenya is helping the country’s credit unions and businesses thrive.
Click to view larger image Kenyan farmer Patrick Mutua cultivates 900 coffee trees. He also is a member of Universal Traders SACCO, which participates in the World Council of Credit Unions’ SACCO Growth Program.
Patrick Mutua is one individual the program is helping. With 900 coffee trees to tend, Mutua is considered by his neighbors to be a successful farmer and busy man. He also serves as vice chairman of the Kyaume Farmers' Cooperative, one of Kenya’s coffee cooperatives, whose members band together for bulk purchasing and crop sales to negotiate the best prices for each. Mutua and his fellow co-op members also are members of Universal Traders SACCO (UTS), a credit union whose five branches now serve more than 18,000 members, including 1,500 coffee farmers and eight growers’ cooperatives like the one to which Mutua belongs. UTS is one of four credit unions that has grown in size as a member of WOCCU’s growth program, funded by the Bill & Melinda Gates Foundation. Although only two years old, UTS scored a coup when the Kenyan government recognized its value to members and partnered with the SACCO to administer the agricultural loan funds it provides to coffee growers nationwide. The plants are in the early stages of the growing season, with harvest nearly six months off, meaning the coffee farmers will be seeking to tap the 10 million Kenyan shillings (about $133,000) in government loan funds that UTS will distribute to farmers who are SACCO members, according to Jacob Wambua, manager of the UTS branch in Tala. “We don't pay them in cash,” Wambua said. “We post it to their credit union account. To qualify for the government funds, they must be actively cultivating at least 100 coffee trees. And they have to be members in good standing.”
Click to view larger image Universal Traders SACCO Chairman Isaiah Mutungi (left) and Jacob Wambua, branch manager, support Kenya’s coffee farmers by administering government-funded loans. (Photos provided by the World Council of Credit Unions)
The government loan program aims to strengthen and grow Kenya's coffee export program, which has languished in recent years due to social and economic issues. Funds are loaned to qualifying farmers at a 10% interest rate. Of that, UTS is able to keep 5% of the interest earned on the loans to fund its operations, Wambua said. Participation in the government program is a step forward for UTS itself, whose membership had dwindled until two years ago when it became part of the WOCCU program. WOCCU provided technical assistance and branding support while fostering an aggressive marketing campaign that took credit union representatives into the massive twice-weekly public markets in Tala, which has a population of about 100,000, to solicit members. The efforts helped the credit union grow from 1,600 members to its current level in about 18 months, according to Isaiah Mutungi, pastor of the Africa Inland Church and chairman of the UTS board. The relationship with WOCCU has been a steep educational process in order for UTS to reach its current success levels, said Mutungi, who also farms his own crop of 800 coffee trees. It has also awakened in credit union staff and board members the notion that the SACCO members themselves can benefit from some much needed financial education, which has become an active part of their service program. “In the olden days, people did not know banking,” Mutungi said. “You can even give small babies coins and they learn how to spend, but not how to save. This is what we are teaching them.” Financial education is central to the program that supports the coffee farmers who live near Tala and the SACCO's four other branches. Understanding savings and learning how to manage money are especially critical this time of year, when the coffee trees are in their initial budding stages and far from providing any income to their growers. The support and strengthening WOCCU has been providing UTS over the past few years has enabled the SACCO, in turn, to provide similar services for its members, Mutungi said. “Our partnership with WOCCU has added great value to the SACCO and gives us a better foundation for a more strategic approach,” Mutungi added. “We believe we are ahead of other SACCOs in Kenya, but we are still learning. And we would like to pass that understanding on to our members as well.”

CUs can follow Community CU conference through live blog

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LAS VEGAS (10/23/09)--Credit unions can follow happenings at this year’s Credit Union National Association (CUNA) Community Credit Union and Growth Conference in Las Vegas by visiting CUNA’s YES CU blog. The conference kicked off Wednesday and will continue through Saturday in Las Vegas. The theme is “Share the Vision. Shape the Future.” This year’s conference combines the CUNA's YES Summit, Reach Out, and Community Credit Union conferences. Josh Jones, CUNA manager of new media and communications, is live-blogging from event. He will provide updates on keynote speakers, breakout sessions and other events through blog postings and video. Jones blogged last year from CUNA’s YES Summit along with Phil Heckman, CUNA director of youth programs, and Christopher Morris, CUNA Councils web manager. “We took the original YES blog and re-branded it for the conference, and repurposed the editorial focus so that we cover growth and other issues in addition to youth and young adults,” Jones said. “The moniker is now ‘Your Essential Strategies for Growth.’” The blog also includes “quick quips”--a running status update that appears live on the blog’s main page to give viewers immediate information. To learn more about the conference, visit the YES CU blog or follow conference updates on Twitter by using the links.

Wis. league drives CU participation in investment program

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MADISON, Wis. (10/23/09)--With the help of the Wisconsin Credit Union League, more than 3,500 credit union employees have registered for free online courses on investing through the REAL Progress and Pathways to Prosperity (RP3) program, according to Investor Protection Trust (IPT). The program’s goal is to provide on-line investor education to 4,000 employees and then study how investing behaviors changed among both employees and members of the credit unions. Because 3,500 employees have already registered for the first phase of the project, project leaders are confident that more than 4,000 employees will participate within the two phases (investorprotection.org September 2009). More than 3,000 employees have taken the pre-course survey and more than 2,800 online course modules have been completed by employees, according to the Department of Financial Institutions (DFI). The Wisconsin league also helped to sign memorandums of understanding with 75 credit unions statewide, surpassing the original goal of 40, the DFI said. Also, during Money Smart Week in Wisconsin, Wis. Gov. Doyle's Council on Financial Literacy officially endorsed a concept to recognize employees and CUs for their participation, the DFI said. IPT awarded a grant to the Center on Business and Poverty through the University of Wisconsin Foundation to implement the program. The Wisconsin league partnered with the Governor’s Council on Financial Literacy, Precision Information, and other businesses and non profits on the project. Investor education is being offered primarily through an on-line provider, Precision Information, and its Educated Investor University.

CUNA noted in IUSA TodayI article on Obama announcement

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WASHINGTON (10/23/09)--The Credit Union National Association (CUNA) was noted in a Thursday USA Today article about the Obama administration’s plan to boost lending for small businesses. The article focused on helping the Obama administration's announcement of initiatives to help small businesses receive more access to credit. For instance, President Barack Obama plans to ask Congress to expand the maximum loan size of U.S. Small Business Administration (SBA) loans. Loans for small business borrowers would increase to $5 million from $2 million, and to $5.5 million for manufacturers. SBA’s Microloan would increase to $50,000 from $35,000. “The administration can and should go further in allowing more credit union access in making business credit available,” CUNA told the newspaper. Credit unions are capped at providing no more than 12.25% of their assets in small business loans. To read the full article, use the link.

Photo contest encourages CU members to dream big

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SANTA ROSA, Calif. (10/23/09)--Redwood Credit Union (RCU) is encouraging members to “dream big” with RCU’s new “Big Picture, Big Value” photo contest and win $2,009 to be placed in a member’s savings account in 2009. The promotion encourages people to look at their personal “big picture”--their reason for saving money, borrowing responsibly and participating fully in their credit union to gain the best possible value on their financial services--and then submit an original photo of their “Big Picture” dream online by Nov. 8. Photos will be posted to the credit union’s website and the public can vote for their favorite “Big Picture” online Nov. 9 through Nov. 22. The grand prize winner will be announced on or before Dec. 15, and $2,009 will be deposited into an RCU Build-Your-Own savings account to help members save for their designated goals. “As the overall economic picture begins to show signs of improvement, this promotion encourages our members and communities to focus on their own financial ‘big picture,’ set goals for their future, and have a little fun by sharing their big dream for a chance to win the cash to help them achieve that dream,” said Karen Graves, RCU senior marketing specialist, who is leading the “Big Picture” promotion. RCU, based in Santa Rosa, Calif., has more than $1.7 billion in assets.

Calif. CU donates 70000 this year to nonprofits

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PLEASANT HILL, Calif. (10/23/09)--During the first three quarters of 2009, Pacific Service CU donated more than $70,000 to nonprofit organizations throughout Northern California. “The need for services in the greater San Francisco Bay Area continues to be very high,” said Toni Bullard, Pleasant Hill branch manager of the $1.7 billion asset, Walnut Creek, Calif.-based Pacific Service CU. “Our continued support of local non-profit organizations, like the Bay Area Rescue Mission, provides a measure of stability in uncertain times.” The Bay Area Rescue Mission was established in 1965 to provide food, shelter and charitable service to the homeless to help them achieve self-sufficiency. The mission offers long-term substance and homelessness recovery programs, short-term emergency assistance, and an after-school center for youth. Pacific Service donated funds to support the educational programs of the mission. Also, the credit union donated four computers to the organization for computer literacy, education and homework assistance, and writing skills. Other San Francisco Bay Area groups receiving donations from the Pacific Service in the third quarter include Oakland Ballet and Marine Mammal Center. “Every year, local non-profit organizations provide valuable benefits to our community, and this year fund-raising for charitable organizations has been decimated by the economy,” said Steve Punch, president of Pacific Service CU. “With the continued support of our members and board of directors, we are very proud to able to continue to support local organizations that contribute so much to our community.” Pacific Service has donated money this year to:
* The American Red Cross; * Axis Community Health; * Bay Area Rescue Mission; * Cal Ripken Youth Baseball of Fresno; * Children’s Hospital Central California; * Children’s Hospital Oakland; * City of Fresno Crime Prevention Office; * Easter Seals Child Development Center in Fresno; * Elder Financial Protection Network; * Embarcadero YMCA; * Food Bank of Contra Costa and Solano; * Fresno County Economic Opportunities Commission; * Fresno Police Activities League; * Juvenile Diabetes Research Foundation of the Bay Area; * Juvenile Diabetes Research Foundation of Fresno; * Lindsay Wildlife Museum; * Marine Mammal Center; * Oakland Ballet; * The Salvation Army of Fresno; * The Salvation Army of San Francisco; and * Shih-Yu Lang YMCA.
During the third quarter, Pacific Service also hosted free child safety events in Livermore and Vacaville. These events offered free DNA LifePrint kits, electronic fingerprinting and child safety journals, along with child health and safety information provided by area public safety groups and non-profits. Launched in 2001, the credit union donates funds through its Community Involvement Program. Over the years, the credit union has given more than $1 million to area charities, impacting an estimated 386,000 people. An ongoing program funded annually by the credit union’s board of directors--the Community Involvement Program-- primarily focuses its efforts on organizations that assist low-income and at-risk individuals, especially children. The credit union gives to charitable organizations located in the 12 counties it serves: Alameda, Contra Costa, Fresno, Marin, Napa, Placer, Sacramento, San Francisco, San Mateo, Santa Clara, Solano and Sonoma.

Laid-off workers aided by new CU programs

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ERIE, Pa. (10/23/09)--Erie (Pa.) General Electric FCU has developed several new programs to help members who are among the 1,500 workers laid off from the company’s Lawrence Park, Pa., plant. The credit union is offering free consultations with financial advisers, and is working with members one-on-one to restructure loans as needed (Life is a Highway Oct. 21). Also, the credit union has launched a website, LaidOffinErie.com, to help members and non-members find new employment, keep their finances in order, and plot new goals. The credit union is also offering a job-hunting seminar to the public, with an emphasis on interviewing skills and polishing resumes. The $187.6 million-asset credit union received TV coverage about the new website and its special programs (see link). In September, GE Transportation--builder of electric locomotives in Erie, announced that the 1,200 workers on temporary layoff were permanently without jobs. Also, the company announced that within the next two months, 230 hourly jobs and 50 salaried jobs would be cut, along with 200 lost jobs at an engine plant in Grove City, Pa.

WOCCUs Branch in a Backpack extends member service in Kenya

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NAIROBI (10/23/09)--The World Council of Credit Unions (WOCCU) is helping credit unions service people in remote areas of the world through a ‘branch in a backpack’ program.
Click to view larger image Jesus Chavez, World Council of Credit Unions’ Kenya program director, demonstrates the “branch in a backpack,” which brings credit union services directly to members. (Photo provided by the World Council of Credit Unions)
In the village of Kakuyuni in rural Kenya, there are no financial institutions. Residents often have to spend up to 90 minutes on a matatu--a somewhat uncertain form of public transportation--to make deposits into accounts at the nearest branch of Universal Traders SACCO (UTS), their closest credit union. The challenge in making the trip over Kenya's rough roads often reduces their interest in utilizing the credit union. With funding from the Bill & Melinda Gates Foundation, WOCCU developed the "branch in a backpack" alternative. “This is another step in new transaction technology that will help us better serve people without easy credit union access," said Jesus Chavez, manager of WOCCU's SACCO Growth Program in Kenya, to members of the Kakuyuni Dairy Farmers Self-help Group this week. A collection of high-tech electronic equipment, anchored by a Dell laptop computer with 160 gigabytes of memory, makes up Chavez's “backpack branch.” Rounding out the basic lineup is an inexpensive computer-mounted camera, a portable scanner and point-of-service (POS) device with biometric capabilities. All fit into a standard-size backpack that can be taken to villages like Kakuyuni, whose members live too far from the nearest credit union branch to visit regularly. The laptop serves as the branch’s engine, with the mounted camera used to take pictures of new members in the field. The small scanner, which connects via USB port to the computer and taps its battery power to function, is used to copy legal documents required to enroll SACCO members. The POS device, which scans the print on each member's thumb or finger of choice, allows the credit union representative to verify the member's identity for each transaction. The device also sends the transaction's information for processing to the mainframe at WOCCU Services Group, WOCCU's for-profit subsidiary that shares its development program's Nairobi office and supports the high-tech initiative. The technology saves members countless hours of travel to and from their credit unions to conduct simple transactions, Chavez said. The small laptop has limited battery life, which led the WOCCU program director to add a Powergorilla and Powermonkey to each of the backpack branches. The two devices, produced by Powertraveller Ltd., headquartered in the United Kingdom, are batteries for the laptop and POS device, respectively. They are rechargeable using small portable solar panels that fit into the backpack. WOCCU pays about $1,300 for each “branch.” The new backpack branch interacts with members' existing cell phone banking capabilities, an interactive technology that WOCCU introduced in Kenya in March 2007. The devices use M-PESA, a software program created jointly by Kenya telecommunications provider Safaricom and the United Kingdom's Vodaphone. “M“ stands for “mobile“ and “pesa” is Swahili for “money.“ By March 2009, two years after WOCCU introduced the technology, M-PESA transactions throughout Kenya totaled $1.73 billion. “This year M-PESA has introduced online bill-pay,” said Chavez. “The company also just announced that it was going international.” On Wednesday, WOCCU signed an agreement in Kenya with I&M Bank House to support the program SACCOs with clearing services required to make the backpack branch a viable option. However, Chavez also is ready to take his SACCOs to the next step in high-tech transactions by introducing a smart card that includes the member's identifying thumb or fingerprint on its memory chip. The device also can act as a stored-value card, enabling easier transfer of funds through ATM or backpack branch usage. “It's called ‘virtual wallet,’” Chavez said. “Members just have to remember never to leave any of their fingers at home.”

CU System brief (10/22/2009)

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* HERNDON, Va. (10/23/09)--The Northwest FCU (NWFCU) Foundation presented the Reality Store to the senior class of a local high school to teach them about finances. More than 700 students participated in the event. The Reality Store is a budget simulation workshop that assigns individuals a life scenario with familial and financial status. Students make a budget and choose expenditures for everyday living expenses--such as housing and food. The event also was taped by a public television crew to air during a show in November. Fifty-six volunteers, including staff from NWFCU, helped with the event. NWFCU, Herndon, Va., has $1.7 billion in assets. (Photo provided by Northwest FCU) ...

Charity benefits from CUs football-game parking fees

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GREEN BAY, Wis. (10/22/09)--Pioneer CU donates money generated from fees for parking cars on its property during Green Bay Packer football games to charity. The $409 million asset, Green Bay, Wis.-based credit union is one of several businesses near Lambeau Field--the Packers’ stadium--that gives parking fees to nonprofit organizations and charities (Green Bay Press-Gazette Oct. 19). Pioneer officials take turns parking cars during Packer games. They also choose which organization receives the parking revenue when its turn comes up, the newspaper said. For the past 25 years, the credit union has supported the Boys & Girls Club, Freedom House, Boy Scouts, Girl Scouts, the Bay Area Humane Society, Big Brothers Big Sisters and a skating program for the handicapped, the paper said. Pioneer’s parking lot holds 200 cars, and it collects between $17,000 and $20,000 per year, Pioneer CEO Tom Young told the paper. Also, people are respectful of the fact that the money goes to charity, Joe Slattery, Pioneer vice president of marketing, told the paper. Three customers who parked at past Packer games before credit union officials were there to collect money paid their past-due fees Sunday, he added.

CUs grow by attracting Latino members

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DES MOINES, Iowa (10/22/09)--Six years ago, Jose Francisco Batres and Martha Alarcon moved to Des Moines, Iowa, from Veracruz, Mexico. They joined Village CU in Des Moines so they could send money to Mexico, which turned out to be a gateway for them to use other credit union services. Alarcon and Batres, who work 14 hours a day in a restaurant, also opened a savings account at the credit union and were invited to serve on the Hispanic Advisory Council at Village CU (EFE News Service Oct. 20). The Iowa Credit Union League told EFE News Service that its credit unions have experienced sustained growth since offering services to the Hispanic community. Latinos have a “high level of participation in the labor force, their family incomes are on the rise, their purchasing power is also growing and they are ambitious,” said Patrick Jury, Iowa league president. Village CU “understood the value of providing services to the [Hispanic] sector with its rapid demographic growth,” Jury said. The credit union’s outreach to Hispanic members has brought in more than $8 million to the credit union. Other Iowa credit unions also are working to attract Hispanics. Des Moines Metro CU began offering $500 loans to Hispanic immigrants to help them establish their credit. The credit unions’ efforts are the “starting point” that eventually lead Hispanics to begin using other services--like direct deposits and business loans, according to Ahmee Vang, remittance specialist at the World Council of Credit Unions. The Hispanic market is often misunderstood by financial institutions because some think they need to wait until Hispanics adopt the services they offer. Financial institutions have to reach out to the market--which is what credit unions are doing, Vang said. To succeed in reaching Hispanics, credit unions need to create a specific marketing plan, train their personnel in Latinos’ financial needs, and offer financial education to immigrants, Vang said. WOCCU statistics indicate that in 2008, $307 billion in remittances were sent from the U.S. WOCCU created a remittance program to help credit unions offer services for Latinos, and credit unions that have used the program have benefited immediately, Vang added.

Filene researchers innovators and leaders convene

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MADISON, Wis. (10/22/09)--Many researchers, innovators and leaders from the United States and Canada covened in Montreal, Canada, Sept. 29--Oct. 1, for the Filene Research Institute’s collaborative gathering--big.bright.minds--to discuss credit union issues. The annual meeting of Filene’s Research Council, i³ teams, fellows, administrative board, and special guests began with a reminder from Filene CEO Mark Meyer that U.S. credit unions can benefit from looking to their northern neighbors who, on many levels, are weathering the recent economic storm with fewer damages than their American counterparts. In Montreal, Filene’s academic fellows reported on their projects, which ranged from changing financial behaviors at retirement by Jinkook Lee, of the RAND Corporation, to credit union opportunities in Latino families by Barbara Robles, Arizona State University. Also discussed were advances in “customer experience” research by Dorian Stone, of McKinsey and Company, to a report on the Michigan “Save to Win” pilot by Peter Tufano, a Harvard Business School professor. Princeton professor Eldar Shafir delved into the differences between traditional and behavioral economics. Credit unions could learn from the behavioral approach, which would lead to products built around real, not just ideal, consumer behavior, he said. The big.bright.minds gathering featured i3 innovations. The ideas ranged from helping renters to improving credit union members’ environmental impact. They include:
* Giving CD--Members earmark proceeds from deposits to support the cooperative movement; * Joint purchasing initiative--Credit unions cooperate to slash their health insurance benefits costs; *Responsible rent loan---Property owners and qualified renters connect through the credit union; * Share the Wealth--Credit unions grow loan portfolios and boost fee income with home equity loan referrals; and * The Leap--Members save money and the environment when they “go green.
“It feels historic for those of us following on the work of Desjardins and Filene to spend this time face to face,” Meyer said. “Being here together continues the conversation around cooperation and innovation that began more than 100 years ago.” The Montreal conference was hosted in part by the Desjardins Group, a Quebec-based federation of 513 independent “caisses” (credit unions) that share resources and a common brand. For more information, use the links.

Housing holding its own Hampel tells IMarketWatchI

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MADISON, Wis. (10/22/09)--U.S. housing construction has strong fundamentals and is prevailing against economic forces, Bill Hampel, chief economist at the Credit Union National Association, told MarketWatch Tuesday. “[Housing construction is] holding its own against some strong headwinds,” Hampel told MarketWatch. The industry’s fundamentals are sound because of low mortgage rates and relatively low home prices. There’s also pent-up demand for housing, he added. Housing starts are down 28% in the past year, with starts of single-family homes 8.7% below par, and starts of apartments and condos nosediving 69%, MarketWatch said. In September, new construction of U.S. housing was basically flat with a seasonally adjusted annual rate of 590,000, the Commerce Department reported Tuesday. Factoring in September’s 0.5% estimated increase, housing starts have been flat for four consecutive months, following a large rebound earlier this year from historic lows, analysts said. Since hitting the bottom in January, housing starts have increased 21%, analysts added.

CU System briefs (10/21/2009)

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* BATON ROUGE, La. (10/22/09)--A robber pepper-sprayed two female employees of Pelican State CU in Baton Rouge, La., Friday night after taking money from the credit union. Neither employee was seriously hurt, but one was treated for a foot injury from the attack (Associated Press Oct. 21). Police are searching for the robber. Pelican State CU has $167 million in assets ... * REDWOOD CITY, Calif. (10/22/09)--San Mateo CU (SMCU) funded the equivalent of 560 lunches through its refer-a-friend program, which means that every time a member refers another person to the credit union for membership, SMCU will contribute to Second Harvest Food Bank of San Mateo County. The program was launched this summer and runs through the end of December. The 560 lunches are the result of referrals in the program’s first quarter. On Oct. 15--International Credit Union Day--SMCU presented the food bank with the results of the fundraiser. SMCU, Redwood City, Calif., has $607 million in assets ...

S.D. CU granted community charter

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SIOUX FALLS, S.D. (10/22/09)--Sioux Falls, S.D.-based Bell FCU has been granted a community charter to serve two counties in the state, and is hoping to use its expanded membership to offer more services and better rates. The credit union applied for the charter to ensure future growth, said Darla Erb, Bell FCU president. It also dropped the “Sioux Falls” from its former name--Sioux Falls Bell FCU (Argus Leader Oct. 21). The credit union was created 70 years ago to serve telephone employees. Many credit unions are looking to expand, Jeff Olson, political and public affairs director for the Mid-America Credit Union Association, told the newspaper. For credit unions that serve a closed membership--or a specific company as Bell FCU used to--there is a need to expand because industries and professions have contracted, he said. Credit unions that expand and gain more assets also can provide more member business loans. Credit unions are capped at 12.25% of their assets for business loans, so by having more assets, they can expand their loan portfolio, Olson said. Bell FCU has $29.9 million in assets.

Canada Mexico CUs partner through WOCCU program

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EDMONTON, Alberta, Canada (10/22/09)--On Oct. 8, Canadian credit union history was made when Servus CU, Edmonton, Alberta, signed a formal partnership agreement with Caja Yanga CU, Veracruz, Mexico. The partnership, facilitated by the World Council of Credit Unions’ (WOCCU) International Partnerships Program, is the first direct relationship involving an individual Canadian credit union.
New partners (from left) Eduardo Rojas, Caja Yanga; Garth Warner, Servus CU; and Margarito Saavedra, Caja Yanga; sign a partnership agreement, with World Council of Credit Unions’ Victor Miguel Corro and Servus CU's Penny Reeves in attendance. (Photo provided by the World Council of Credit Unions)
“Partnering Servus with an international credit union has been my dream for some time,” said Penny Reeves, secretary of the WOCCU board of directors and director for the $9.6 billion Canadian credit union. The only other Canadian partnership exists between Central 1 CU of British Columbia, which operates similarly to a U.S. corporate credit union, and the Credit Union League of Hong Kong. The partnership between Servus and Caja Yanga, which has assets of $22 million, continues a relationship that began in March. Officials from the two partner credit unions met in Córdoba, Veracruz, to examine Caja Yanga's outreach to rural communities and the success of WOCCU's PATMIR II project funded by the Mexican Ministry of Agriculture, Livestock, Rural Development, Fishing and Food (SAGARPA). The project has helped Caja Yanga grow its membership and strengthen its role as a financial institution. Caja Yanga also is piloting WOCCU’s MatchSavings.org. The online program allows people worldwide to match the small savings of individual Caja Yanga members through a dedicated website. By helping Caja Yanga members save for housing, micro business, education and healthcare expenses, MatchSavings.org participants are helping the credit union's poorest members build savings habits as a first step toward overcoming poverty. During a partnership visit to Edmonton earlier this month, Caja Yanga officials identified new product development, governance and ATM implementation as areas in which the Mexican credit union would like assistance. Caja Yanga is currently working with Union Coop of Mexico, part of WOCCU’s for-profit subsidiary WOCCU Services Group, to launch a credit union-owned ATM network throughout Mexico. Caja Yanga needs assistance in developing sound policies and procedures to help better manage in-branch ATMs, an area in which Servus can help. “We can learn from Servus’ experience in rolling out new initiatives,” said Margarito Saavedra, Caja Yanga's general manager. “We will place special emphasis on enhancing our electronic delivery channels.” Governance also was discussed by the Caja Yanga delegation, which, in addition to Saavedra, included Eduardo Rojas, chairman, and Francisco Perez, marketing manager. Rojas met with Reeves and other members of Servus' board of directors, to discuss credit union growth and the board’s role in facilitating--rather than managing--the process. In return, Servus officials hope their credit union's experience with Caja Yanga will help their employees stay in touch with their cooperative roots and make a contribution to international credit union development. “No matter the size of our organizations, we share in our commitment to helping members,” said Garth Warner, president/CEO of Servus.

Iowa league announces board at convention

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Click to view larger image The Iowa Credit Union League board was elected Sept. 24. From left are board members Tim Marcsisak, John Bentler, Rick Benhart, Pat Drennen, Dennis Choate, Mike Whittie, Tim Wallen, Joe Hearn, Janine Keim, Tim Chapman, Joe Gonzalez, and Brent Helin. (Photo provided by the Iowa Credit Union League)
DES MOINES, Iowa (10/21/09)--The Iowa Credit Union League board was announced at the league’s annual convention Sept. 24. The 12-member board represents Iowa’s 138 credit unions and one million members, the Iowa league said. “On behalf of the Iowa Credit Union League, I would like to congratulate these individuals for being elected to the league board of directors,” said Pat Jury, league president/CEO. He noted the league appreciates the board's willingness to lead the league and fulfill its long-term strategic vision. Board members for the up to 6.9 million asset category are:
* John Bentler, River Bend CU, West Burlington; * Janine Keim, Consumers CU, Denison; and * Dennis Choate, Quaker Oats CU, Cedar Rapids.
Board members for the $7 million to $19.9 million asset category are:
* Joe Gonzalez, Alliant CU, Dubuque; * Tim Marcsisak, Nishna Valley CU, Atlantic; and * Michael Whittie, Federal Employees CU, Des Moines.
Board members for the $20 million to $49.9 million asset category are:
* Tim Chapman, Members Community CU, Muscatine; * Brent Helin, Des Moines Metro CU, Des Moines; and * Tim Wallen, Ace Community CU, Ames.
Board members for the $50 million or more asset category are:
* Rick Benhart, Collins Community CU, Cedar Rapids; * Chair Pat Drennen, 1st Gateway CU, Camanche; and * Vice Chair Joe Hearn, Dupaco Community CU, Dubuque.

Clarke Community FCU merges with Gwinnett FCU

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ATHENS, Ga. and LAWRENCEVILLE, Ga. (10/21/09)--The Clarke Community FCU board recently agreed to merge with Gwinnett FCU. Both credit unions are in Georgia. The merger will provide Clarke Community members with access to Gwinnett FCU’s full range of financial products and will give Gwinnett a presence in Clarke County, Gwinnet said. “The merger of our two credit unions demonstrates a shared commitment and vision on the part of both boards to grow and remain highly competitive in today’s financial marketplace,” said Marshall Boutwell, Gwinnett president/CEO. “There will be no layoffs, and Clarke Community will retain its name, operating as a division of Gwinnett Federal.” Gwinnett FCU, based in Lawrenceville, Ga., has $148 million in assets and serves 27,000 members in a five-county area. Clarke Community FCU, based in Athens, Ga., has $18.7 million in assets.

Texas CU Foundation expands fin lit outreach to Belize

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FARMERS BRANCH, Texas (10/21/09)--The Texas Credit Union Foundation (TCUF) has expanded its outreach to Central America through a recent “train the trainer” session to help teach financial literacy in Belize. Courtney Nickles, foundation executive director, recently presented the National Endowment for Financial Education High School Financial Planning Program, a financial literacy program aimed at high school-aged students, to educators, credit union staff and community leaders in Belize. The Belize Credit Union League has a partnership with Southwest Corporate FCU in Plano, Texas (LoneStar Leaguer Oct. 20). During the session, Nickles gave classroom-style presentations and had interactive role-playing activities to help students relate to their materials. “We can see how our partnership with the foundation will facilitate a wide cross-section of credit union members and high school students to learn fundamental financial management skills, which will allow them to make informed financial decisions from an early age,” said Corinne Fuller, Belize league executive director. “We are excited about the possibility of including financial planning in our high school core curriculum.” The Ministry of Education in Belize also attended the presentation. “We at the Ministry of Education believe that financial education should definitely be included in the curriculum if we are truly educating our students to take care of themselves, as well as to participate in nation building,” said Carol Babb, Ministry of Education deputy chief education officer. “We intend to integrate this topic in the social studies curriculum.” Belize has the highest literacy race in Latin America, but the country is plagued with poverty and unemployment, said Victor Miguel Corro, World Council of Credit Unions senior manager of international partnerships. “Providing the people of Belize with the tools to make better choices with their money, coupled with access to affordable financial services, remains essential to improving the quality of life in the country,” Corro said. Nickles noted that the presentation was an emotional experience, and the participants were incredibly appreciative. “The luxury of accessible information we are afforded allows us to be aware of the basic fundamentals of financial information, but only when you see the genuine appreciation and comprehension of those individuals who have never learned something we take for granted, like how to balance their checkbook, do you realize how fortunate we are,” Nickles said.

Regulator CUs should keep paper copies of loan docs

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OLYMPIA, Wash. (10/21/09)--Credit unions may want to keep paper copies of an original note, deed or loan agreement in addition to an electronic copy in case a document is needed for litigation, said the Washington State Department of Financial Institutions (DFI). Many credit unions have adopted electronic record storage systems, consistent with some state and federal laws, such as the federal Electronic Signatures in Global and National Commerce Act of 2000, which provides that a signature, contract or other record may not be denied legal effect because it was signed electronically. However, the laws do not resolve all legal or practical issues necessary to make sure the records comply with requirements. Therefore, credit unions should design and operate their electronic record systems to serve:
* Potential use in litigation support; * Internal and external audits and controls; and * Compliance with regulatory requirements.
Credit unions adopting electronic record systems should address the risks of inadequate record retention. Failing to maintain adequate record retention systems can create risk, the DFI said. For more information, use the link.

CU System briefs (10/20/2009)

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* DOVER, Del. (10/21/09)--A Dover (Del.) FCU teller was pushed to the ground during an attempted armed robbery at the credit union last month, according to the Delaware Credit Union League (Together Oct. 15). Police reported that one suspect pushed the teller onto the floor while the other suspect held a gun on another employee, demanding the key to the vault. The teller was not able to comply, so the robbers fled the credit union. A surveillance tape shows that one of the suspects had two handguns. No one was physically injured during the incident ... * ALLENTOWN, Pa. (10/21/09)--James B. Baily, 86, a founding member of A.B. Bellco FCU--now Lehigh Valley FCU--died Thursday. He worked for the credit union as an officer for 50 years (Allentown Morning Call Oct. 17). Lehigh Valley FCU has $14 million in assets ...

IUSA TodayI says try CUs to obtain credit cards

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MADISON, Wis. (10/21/09)--Consumers should consider credit unions when they are looking to apply for credit cards, a columnist for USA Today wrote Tuesday. “If you don’t care about rewards and just want a credit card that doesn’t charge an annual fee, consider applying for a card through a credit union,” wrote personal finance columnist Sandra Block. “Many credit unions charge no annual fee and offer below-average interest rates.” Due to credit card legislation that will--among several mandates--restrict credit card issuers ability to raise interest rates on existing balances, the credit card industry--in response--is implementing other fees, Block wrote. For instance, starting in 2010, Bank of America will charge some customers an annual fee ranging from $29 to $99, Block explained. Also, Citigroup Inc. is beginning to charge annual fees to cardholders who don’t charge more than a specific amount on their cards--usually $2,400 per year, she added. Other banks are charging inactivity fees for customers who don’t use their credit cards during a specific period of time, Block wrote. “You heard that right: You could be spanked for staying out of debt,” she added.

Minn. foundation adds 2 new board seats appoints directors

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SAINT PAUL, Minn. (10/21/09)--The Minnesota Credit Union Foundation (MnCUF) added and filled two new seats to its board of directors at the board’s Oct. 8 meeting as part of the foundation’s recent development progression. Dave Larson of Affinity Plus FCU (APFCU) and Pat Brekken of Richfield/Bloomington CU (RBCU) have been appointed to one-year terms on the MnCUF board, following an affirmative membership vote on the bylaw amendments recommended at the annual meeting in July. Larson is senior vice president of APFCU, where he has worked for nearly eight years. He also serves as the executive director of the Affinity Plus Foundation, whose mission is to promote financial literacy statewide. Brekken is RBCU’s president, a position he has held for the past five years of his 13-year career with the credit union. He currently serves as a director of the Richfield Spartan Foundation, which raises money to support youth participation in sports and fine arts activities throughout Richfield. In 2008, Brekken served as chair of the MnCUF’s Homes for Our Troops Fundraising Committee. Through this initiative, Minnesota credit unions contributed $150,000 to build a specially-adapted home in Woodbury, Minn., for a wounded Iraq War veteran. The two newest board members join the five existing MnCUF directors, re-elected by the membership in July. The directors and term expiration dates are:
* Chuck Albrecht, Mid-Minnesota FCU, Baxter (2012); * Vice Chair Lynn Kothe, North Memorial FCU, Robbinsdale (2012); * Mukomela, Novation CU, Oakdale (2012); * Mary Hansen, Mayo Employees FCU, Rochester (2011); * Secretary/Treasurer Judy Root, Bluestone FCU, Eagan (2011); * Larson, APFCU, St. Paul (2010); and * Brekken, RBCU, Richfield (2010).
Since attaining status as a 501(c) 3 public charity in 2007, the MnCUF board has undergone a strategic planning process, with the aim of strengthening its governance structure and broadening its focus. Other recent accomplishments have included revising bylaws, creating and improving operational policies, establishing a greater Web presence, and recruiting a volunteer administrator. “I am energized by our progress, and we are very excited about continuing to develop the foundation into the premier charity that we know it can be,” said MnCUF Chair Kristi Mukomela.

Pa. man charged with defrauding 3 CUs in ponzi scheme

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HARRISBURG, Pa. (10/20/09)--A Pennsylvania man has been charged with operating a $2 million ponzi scheme that defrauded three credit unions, according to the Pennsylvania attorney general’s office. Eugene D. Miley, 58, is accused of selling fictitious certificates of deposit (CDs) to Moonlight CU, Worthington; VANtage Trust CU, Wilkes-Barre; and Stanwood Area CU, New Stanton. Miley allegedly served as a financial broker for the credit unions, offering to locate and purchase various high interest rate CDs. Miley used the money he received from the credit unions for his personal use. He also generated fake statements about the purchase, interest rates and redemption information for the CDs. “Miley claimed to be helping his clients earn a good return on their investments, but this was simply an illusion,” said Attorney General Tom Corbett in a statement. “As with other ponzi schemes, the money received from new clients was used to pay off older investors, or siphoned off for personal use, until the flow of money stopped--causing the operation to collapse and leaving victims with nothing more than empty promises.” Miley is accused of selling $2.08 million in certificates between 2006 and 2008. He sold $1.3 million to Moonlight CU; $594,000 to VANtage Trust CU; and $99,000 to Stanwood Area CU, according to the attorney general's office. Miley has been taken into custody and will appear for a preliminary hearing Nov. 20. He will be charged with one count of securities fraud for creating a scheme to defraud, a second degree felony punishable by up to 10 years in prison and a $1 million fine; and one count of securities fraud for the sale of unregistered securities, a third-degree felony punishable by up to seven years in prison and a $250,000 fine. Miley also will be charged with three counts each of theft by deception and theft by failure to make required disposition of funds--all third degree felonies, punishable by up to seven years in prison and $15,000 fines. Miley is not licensed to operate as a financial investment company, financial adviser or financial products dealer. The funds for his fraudulent investments were funneled through PNC Bank accounts belonging to him and his business. The transactions were conducted using a PNC Bank branch in Cranberry Township, Pa., Corbett said.

Lawmakers show support on ICU Day

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MADISON, Wis. (10/20/09)--Lawmakers nationwide gathered to show their support of credit unions on Thursday for International Credit Union Day. In Illinois, State Sen. David Koehler (D-Peoria) and State Rep. Joe Lyons (D-Chicago) read statements of support on Illinois Senate and House floors, according to the Illinois Credit Union League. “Congratulations to all Illinois credit unions on your day,” Lyons said while on the House floor. Koehler and Lyons both serve on credit union boards--Koehler on the CEFCU board in Peoria, and Lyons on the board of Credit Union 1 in Rantoul.
From left: Missouri State Rep. Al Liese (D-79) meets with Treina Lind of St. Louis Community CU during a legislative reception in St. Louis to celebrate International Credit Union Day. (Photo provided by the Missouri Credit Union Association)
Missouri lawmakers also gathered to celebrate at the Missouri Credit Union Association’s St. Louis Chapter’s International Credit Union Day Legislative Reception. During the event, 11 state representatives learned about the credit union difference and the benefits of credit union members (The Missouri difference Oct. 16). “When I explained the cooperative structure of shared branching to State Rep. Chuck Gatschenberger, he seemed impressed by the convenience it offers members,” said Charlie Waalkes, American Eagle CU president. “In speaking with the legislators, it was obvious that they are concerned about the financial services industry and the impact to consumers,” added Michelle Rosner, 1st Financial Federal CU vice president of marketing.
Wisconsin lawmakers gathered at Credit Union House in Madison, Wis., to celebrate International Credit Union Day. From left are: Rep. Jason Fields (D-11); Joanne Whiting, executive vice president and chief advocacy officer, Wisconsin Credit Union League; and Tom Liebe, Wisconsin league vice president of governmental affairs.(Photo provided by the Wisconsin Credit Union League)
The Wisconsin Credit Union League hosted an event Thursday at Credit Union House in Madison, Wis., with more than 70 individuals attending--including lawmakers and public officials. Attendees included:
* Rod Nilsestuen, secretary, Wisconsin Department of Agriculture, Trade and Consumer Protection; * Catherine Haberland, executive assistant, Wisconsin Department of Financial Institutions; * State Rep. Tom Nelson (D-5); * State Rep. Jason Fields (D-11), Wisconsin Financial Institutions Committee chair; * State Rep. Kelda Helen-Roys (D-81); * State Rep. Christine Sinicki (D-20); * State Rep. Jim Soletski (D-88); * State Sen. Rob Cowles (R-District 2); and * Darcy Luoma, Madison office director for U.S. Sen. Herb Kohl (D-Wis.).
Brett Thompson, Wisconsin Credit Union League president/CEO, spoke to guests about the league's involvement in the World Council of Credit Union’s International Partnership Program, and the importance of educating legislators, public officials and consumers on the value credit unions provide to their members and communities. "We find great value in sharing knowledge with our friends in the Dominican Republic," Thompson said. "It reminds us that we are part of a larger cooperative system that shares a common mission, and we must work together to protect peoples’ rights to belong to a not-for-profit credit union."

Ecuador CU delegation visits Colorado CUs

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DENVER (10/20/09)--A delegation from CACPE PASTAZA credit union in Ecuador visited the Credit Union Association of Colorado (CUAC) and some of its member credit unions last week to examine how they continued to serve members in spite of economic challenges. “Our Ecuadorian friends visited Colorado at a particularly important and busy period for the U.S. credit union movement,” said John Dill,
Click to view larger image Credit Union Association of Colorado (CUAC) representatives recently met in Colorado with visitors from CACPE PASTAZA, an Ecuadorian credit union. From left are: Pablo Santos, Tim Dore, Karina Espín, Melia Heimbuck, José Miguel Acuña, Janeth Carrillo, CUAC President/CEO John Dill, Pietra Dávila, Carmita Medina and Naila Espín. (Photo provided by the World Council of Credit Unions)
CUAC president/CEO. CUAC maintains a relationship with its Ecuadorian counterpart through World Council of Credit Unions’ (WOCCU) International Partnerships Program. “Our credit unions are recovering from the challenges posed by the U.S. economy's meltdown, and we're in the middle of major legislative fights over interchange fees and member business loans while struggling with member growth,” Dill said. “These are all good things for our South American partners to experience and understand.” The seven-person Ecuadorian delegation came to see the U.S. credit union movement, and CUAC’s role and products and services. The Ecuadorians studied CUAC’s financial education curriculum, its grassroots outreach and lobbying efforts, compliance products and other services provided to its members. Closer looks at the association's credit union service organization (CUSO) and its Credit Union Service Network also were on the agenda for the weeklong visit. “There are a few ideas we can already implement in Ecuador,” said Naila Espín, manager of CACPE PASTAZA's risk management department. “Technology is what we need to introduce very quickly.” The delegation visited several Denver credit unions, including Denver Community CU (DCCU), where the groups discussed ways in which DCCU can better attract and serve Latino members. The Ecuadorians also came to understand DCCU's successes to-date using “low-wealth” products, such as payday loans and financial education, to establish a strong Latino member base. At Premier Members FCU (PMFCU), Boulder, the delegation shared an overview of Ecuador's credit union system, including the country's strict regulatory climate and the challenges that small, unregulated credit unions pose to the system as a whole. PMFCU staff members shared their strategies for managing risk and contingency planning. At BCS Community CU, Wheat Ridge, discussions focused on how small credit unions can improve efficiency and thrive by utilizing the CUSO, something that enables the six-person staff of the credit union to provide services similar to those of institutions many times its size. “No one should doubt that credit unions from thousands of miles away have more in common with each other than we do with a local banker around the corner,” Dill added. “The long standing partnership between Colorado and Ecuador is proof positive that the ‘people helping people' philosophy knows no boundaries, no geography and no limits.“

Pa. assoc. to explain Better Choice program to FDIC

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WASHINGTON (10/20/09)--Mike Wishnow, senior vice president of the Pennsylvania Credit Union Association (PCUA), will discuss the Credit Union Better Choice program Thursday at the Federal Deposit Insurance Corporation’s (FDIC) Advisory Committee on Economic Inclusion’s Strategic Planning Subcommittee meeting at the FDIC headquarters in Washington, D.C. The meeting, which is closed to the public, will focus on how small-dollar loan programs can be scaled across mainstream financial institutions. As part of a panel, Wishnow will discuss the success of the Better Choice program and how credit unions have helped members with short-term loans rather than using payday lenders (Life is a Highway Oct. 19). The Better Choice program, which grew out of a collaborative effort between PCUA and the Pennsylvania Treasury Department, offers short-term loans that help people make the transition away from high-cost payday loans to fairly priced credit union services (News Now April 10). Several executives from other banks nationwide also will participate on the panel, which will be moderated by Rae-Ann Miller, special adviser to the director, Division of Insurance and Research for the FDIC. This is the second presentation PCUA has made to the FDIC on the program. In March 2007, Norb Kaczmarek, CEO of Erie FCU and then board chairman of the PCUA, was joined by Wishnow to make a presentation on the payday lending alternative program to the FDIC Advisory Committee on Economic Inclusion. The committee was established by FDIC Chairman Sheila C. Bair and the FDIC board of directors and includes high-ranking banking officials, regulators, educators, and business and community leaders.

CU System brief (10/19/2009)

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* WICHITA, Kan. (10/20/09)--Credit Union of America, Kansas’ second-largest credit union, plans to open three new branches by the end of 2010. The openings will cost the credit union more than $2 million (Wichita Business Journal Oct. 15 and The Wichita Eagle Oct. 16). The credit union also plans to open a student-run branch Oct. 27 at a local high school that will be open for about two hours per day due to students’ schedules. The three new branches will bring the credit union’s branch network to 11, and create about a dozen jobs in the area. Strong member, loan and deposit growth over the past few years has allowed the credit union to expand despite a struggling local and national economy, Credit Union of America President Bob Thurman told The Wichita Eagle ...

Two Kansas CUs seek merger

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TOPEKA, Kan. (10/20/09)--Two Topeka, Kan.-based credit unions have asked their members to approve a merger. If the merger garners approval from members and state regulators, the $95 million-asset Credit Union 1 of Kansas and the $141 million-asset Credit Union United will combine under a new name (The Kansas City Star Oct. 17). “This is a strong consolidation of two healthy credit unions,” Vickie Hurt, president/CEO of Credit Union 1, said in an announcement. “By joining forces as one organization, members of the new credit union will be able to take advantage of the economies of scale that will promote efficiency, as well as favorable rates and fees.” Employees at both credit unions will keep their jobs, the announcement said. On Nov. 4, members of each credit union will vote on the merger at a special meeting, the newspaper said. Official at the credit unions expect the merger to be finalized in April, the paper added.

Additional nomination received for CUNA Board

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MADISON, Wis. (10/20/09)--The Credit Union National Association (CUNA) has received one final nomination for its 2009-2010 board elections. The new nominee and district category is: Jon Hernandez, Cal Com FCU, Torrance, Calif., District 6, Class A. Already nominated are:
* Dennis K. Tanimoto, Hawaii Credit Union League, Honolulu, Hawaii, District 6, Class D; * Robert M. Cashman, Metro CU, Chelsea, Mass., District 1, Class C; * Kris J. Mecham, Deseret First CU, Salt Lake City, Utah, District 5, Class B. * Laida Garcia, Florida Central CU, Tampa, Fla., District 3, Class B. * Dennis E. Pierce, CommunityAmerica CU, Kansas City, Mo., District 4, Class C; * John A. Graham, Kentucky Employees CU, Frankfort, Ky., District 2, Class A; * Marla S. Marsh, Kansas Credit Union Association, Wichita, Kan., District 5, Class D; and * Susan Steifel, Woodstone CU, Federal Way, Wash., District 6, Class A.
The deadline for nominations was Oct. 16. Nominations were accepted in eight categories:
* District 1, Class C; * District 2, Class A; * District 3, Class B; * District 4, Class C; * District 5, Classes B and D; and * District 6, Classes A and D.
Eligible candidates must be an employee or voting board member of the nominating credit union. Nominations must be in writing and seconded in writing by two other credit unions of the same size group from the district. Only two seconds will be recorded for each candidate. Upon request, a list of credit unions by size group and district will be furnished to candidates to assist in obtaining seconds. To be an eligible league candidate for a CUNA Director position, individuals must be a league president and be nominated in writing by their league, with a second in writing by at least one other league from the district. CUNA’s Corporate Governance Committee will verify eligibility of each candidate, the credit union's affiliation, size group and district, and date/time of receipt. Voting will begin Friday and close Dec. 18. For more information, use the link.

Colo. police probe thousands of stolen debit card numbers

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COLORADO SPRINGS, Colo. (10/19/09)--Colorado Springs, Colo. police are investigating the thefts of thousands of debit card numbers stolen from members and customers of at least five financial institutions--including three credit unions--serving the area. Police spokesman Lt. David Whitlock said "thousands" were victims of the theft, but said police are still putting together the situation (The Gazette Oct. 16). The three credit unions named in the report were Ent FCU in Colorado Springs, Security Service FCU in San Antonio, and Air Academy FCU, in Colorado Springs. The other two institutions were not named. The $2.852 billion asset Ent FCU began notifying between 1,500 and 1,700 cardholders Oct. 10 that their numbers had been compromised. About 150 had fraudulent transactions posted to their accounts, the credit union told the Gazette. Security Service FCU, which has $5.264 billion in assets, said about 200 cards issued to its Colorado Springs area members were affected. The $464.6 million asset Air Academy FCU told the newspaper the security breach occurred at a local merchant. Fewer than 100 cardholders served by the credit union were affected.

Its National Protect Your ID Week

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WASHINGTON and MADISON, Wis. (10/19/09)--This week is National Protect Your Identity Week, and the Credit Union National Association (CUNA) is marking the event with a webinar Wednesday on identity theft fraud. The webinar, "Scammed, Spammed and Stung: Protect Your Credit Union and Your Members from ID Theft Fraud," will be at from 1 p.m. to 2:30 p.m. (CT). It is sponsored by CUNA Strategic Services, CUNA and three strategic alliance providers. Topics covered include:
* Anti-money laundering and fraud deterrence; * Network and information security; * Identity theft protection; and * Consumer education.
The week is sponsored by the National Foundation of Credit Counseling (NFCC) and the Council of Better Business Bureaus (CBBB), and supported by members of the Protect Your Identity Week Coalition, which includes CUNA. Many organizations will have educational events and document shredding activities to make consumers more aware of how they can protect their identity. NFCC notes that nearly 10 million Americans were victims of identity theft fraud in 2008--an increase of 22% over 2007. Last year financial institutions lost an estimated $4,800 per victim. It takes a victim an average of 44 hours to recover from identity theft. According to a report from Javelin Strategy and Research, low-tech methods are still the most popular method for identity thieves. Of the cases where consumers knew how their identity was compromised, stolen wallets and physical documents accounted for 43% of all identity theft, while online methods were responsible for 11% of theft.

CU System briefs (10/16/2009)

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* GREENSBORO, N.C. (10/19/09--North Carolina Credit Union League (NCCUL) President/CEO John Radebaugh won the Executive of the Year Award for 2009-2010 from the Winston-Salem Chapter of the International Association of Administrative Professionals (IAAP). The award is given by each of the more than 600 chapters of IAAP each year in recognition of an executive’s interest and support of their administrative staff person through support of their membership in IAAP and support of their continuing education endeavors. NCCUL Director of Administration Frances Moore, who is a member of the IAAP, submitted Radebaugh for the award. In her nomination essay, Moore noted that Radebaugh “is a strong advocate for our members both locally, nationally and internationally. Although executive of the state’s organization, [Radebaugh] is involved with many other affiliated organizations across the nation and tirelessly defends our purpose” (Weekly Update Oct. 15) … * HONOLULU (10/19/09)-- The University of Hawaii FCU (UHFCU) has named Jeanine M. Morse as its next CEO, effective Dec. 16. She replaces Ariel Chun, who is retiring. Morse currently works as UHFCU’s director of sales and service. Previously, she worked as executive vice president and chief operating officer for Premier Community CU in Stockton, Calif., and executive vice president for The Golden One CU in Sacramento. She also is secretary of the Oahu Chapter of the Hawaii Credit Union League. UHFCU, Honolulu, services the faculty, staff, students and alumni of the University of Hawaii and its affiliated colleges. UHFCU has $394 million in assets ... * WASHINGTON (10/19/09)--Six credit unions are included in the NCB Co-0p 100, which lists the nation's top 100 revenue-earning cooperative businesses, totaling $209 billion in 2008. In the Finance category, CoBank, Greenwood Village, Colo., and Navy FCU, Merrifield, Va., were the top revenue earners, with $2.7 billion each in revenues. CoBank was No. 14 on the Top 100 list and Navy Federal was No. 15. Other credit unions on the list were U.S. Central FCU, Lenexa, Kan. ranked 28; Western Corporate FCU (WesCorp), San Dimas, No. 54; State Employees' CU, Raleigh, N.C., No. 58; Pentagon FCU, Alexandria, Va., No. 75; and BECU, Tukwila, Wash., No. 94 … * RALEIGH, N.C. (10/19/09)-- State Employees' CU members through the SECU Foundation are providing funding for a $1.1 million, 0% interest construction loan to assist in renovating a building in Winston-Salem, N.C., to benefit pregnant and teen mothers. The Reynolds Cottage building will be renovated with six one-bedroom suites, two efficiency apartments and common areas for residents including a kitchen, dining area, living and recreation rooms, and laundry facilities. It will be called "My Aunt's House." SECU is partnering with the North Carolina Housing Finance Agency to support the project, which is sponsored by The Children's Home, a non profit that provides housing and services to youth (Photo provided by State Employees' CU) …

Delaware league to vote on dues restructuring

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NEW CASTLE, Del. (10/19/09)--The Delaware Credit Union League (DCUL) will vote on a change in the league dues structure at a special meeting Oct. 30. The meeting will permit member credit unions to vote on the recommendation of the DCUL board of directors on a proposed dues formula and cap changes (Together Oct. 15). The meeting will be held at Dover (Del.) FCU. Each credit union must provide credentials for two voting delegates or alternates to the league. Each credit union CEO and board chair received a packet of information, including details about each credit union’s financial responsibility if the dues increase passes, the league said.

Ohio CUs seek public deposits law banks oppose it

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COLUMBUS, Ohio (10/19/09)--The Ohio Credit Union League is working to change a state law so credit unions can begin accepting deposits from public entities, which bankers oppose. The legislation, sponsored by Rep. Tracy Maxwell Heard (D-Columbus), would make credit unions eligible depositories for communities, schools and other public systems. The bill is expected to be introduced “soon,” John Kozlowski, Ohio league counsel, told News Now. This is the second time the league has tried to pass legislation to help credit unions accept public deposits. The last attempt was in 2004. The league is looking to help credit unions accept public deposits because a lot of local communities, schools, municipalities and townships have come to the state’s credit unions looking to do business. “The credit unions are being approached [by public entities], and they want to serve the community,” Kozlowski said. Many public entities also want to diversify their deposits because of concerns regarding deposit insurance, Kozlowski said. The league also believes that public entities should have a choice when making deposits and should not be restricted by an “archaic” law, Kozlowski said. He estimated that there are about 20 or more states that allow credit unions to accept public deposits. Banks argue that credit unions should not be able to accept public deposits because they are tax-exempt. “Credit unions do pay taxes but not the same as bankers,” Kozlowski said. He noted that credit unions’ tax exemption is structured differently because it is a nonprofit organization. Credit unions pay rural property taxes, which benefit schools and towns. Also, there are nonprofit hospitals and nursing homes in Ohio that receive money from the state through a cooperative structure, he added. The league is hopeful that the bill will pass and it will continue to work on the issue. “It’s important that entities want to keep their money where credit unions are,” Kozlowski said. “Credit unions make a difference in Ohio citizens’ lives.”

Mich. lawmaker CUs have best grassroots advocacy

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LANSING, Mich. (10/19/09)--The Michigan Credit Union League's (MCUL) Capitol Day grassroots lobbying luncheon Wednesday saw a strong turnout, proving Michigan credit unions are making their relationships with lawmakers a high priority. And, judging from the kudos received from lawmakers, the legislature is taking their credit union constituents' concerns seriously, said MCUL.
With Michigan's House Resolution for Credit Union Week are (from left) E&A CU Executive Vice President Michelle Myrick, State Rep. Andy Coulouris, State Rep. Dan Scipps, and Michigan Credit Union League President/CEO David Adams.
Michigan State Rep. Vincent Gregory (left), D-Southfield, mingles with credit union attendees at the Michigan Credit Union League's Capitol Day Wednesday. (Photos provided by the Michigan Credit Union League).
More than 80 legislators and staffers attended the event in Lansing with about 86 credit union people, who discussed issues affecting the industry against the backdrop of International Credit Union Week. After lunch, Credit Union Week resolutions and a proclamation were presented by State Sen. Alan Sanborn (R-Richmond Township), State Reps. Andy Coulouris (D-Saginaw) and Dan Scipps (D-Leland), and Jerome Marks from the office of Gov. Jennifer Granholm. All three lawmakers expressed a positive message about credit unions, said the league, but Coulouris, also chairman of the House Banking and Financial Services Committee, "heaped praise on the industry's advocacy efforts and the role of the state economy," said MCUL. "You're probably going to think what I'm about to say to you I say to all the girls, but I don't," Coulouris told the group. "You have, bar none, the best grassroots advocacy team in the state. Nobody does a better job advocating in Lansing, and nobody does a better job advocating in our districts. You make our jobs as proponents of credit unions easy," Coulouris said. "It's a lot easier for me to get my colleagues to support your interests and our state's interests when you do such a good job on my behalf speaking to them in your districts. We live in a time where trust is hard to come by, and you stand alone in your ability to instill that trust again. The role that credit unions play in their communities as beacons of trust, of bedrocks that the people we represent know they can count on--that role is so important and has never been more critical." Before the luncheon, credit union attendees convened for a Government and Political Affairs Forum and a briefing on important legislation that could impact credit unions. These included account inactivity fees (Senate Bill 772), account error notification (Senate Bill 779) and financial elder abuse (House Bill 5187). Bills addressing financial privacy and an annual political action committee signature requirement also were covered. "The large attendance by lawmakers shows that the Michigan legislature views credit unions as an important part of our state economy and vital for consumers as trustworthy financial service providers," said MCUL President/CEO David Adams. "It's encouraging to see this high level of credit union participation, also." Coulouris also thanked Adams and MCUL's government affairs team for their role in the creation this year of a new law that temporarily freezes the foreclosure process while lenders and borrowers work out a plan, among other measures. He cited this law as "one of the most important things [the state has] done this year in response to the foreclosure crisis."

WOCCU member groups launch European CU network

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BRUSSELS, Belgium (10/19/09)--The World Council of Credit Unions (WOCCU) and six European credit union organizations last week
Click to view larger image European Parliament member Marian Harkin, Ireland, co-hosted a European Credit Union Network meeting in Brussels last week to launch the European Network of Credit Unions.
Click to view larger image "Credit unions have operated with sound regulatory and internal standards," the National Association of Cooperative Savings & Credit Unions’ Grzegorz Bierecki told participants at the European Network of Credit Unions breakfast.
Click to view larger image “We welcome the launch of the new organization representing credit unions,” Malcolm Harbour, chair of the European Parliament’s Internal Market and Consumer Protection Committee, told the European Network of Credit Unions. (Photos provided by World Council of Credit Unions)
launched the European Network of Credit Unions. The network will serve as a platform to exchange information among member organizations and speak in a unified voice about issues affecting European credit unions. The network convened its first meeting at a Tuesday breakfast dedicated to presentations on responsible lending in Brussels. European Parliament members Marian Harkin, Ireland, and Jacek Kurski, Poland, co-hosted the event. “For the past five years, we have been working together to create a greater awareness of the contributions credit unions make to the European Union,” said Dave Grace, WOCCU vice president of association services and as the network's vice president. “This is a historic day for European credit unions because the network will strengthen the role credit unions play in providing important financial service alternatives to European citizens.” More than 40 people attended the meeting. They included 14 members of the European Parliament, four members of the European Commission and three from the Council of Ministers. Speaking about responsible lending were Grzegorz Bierecki, second vice chairman of WOCCU’s board and president of the National Association of Cooperative Savings & Credit Unions (NACSCU), WOCCU’s member organization in Poland; and Mick McAteer, director of the United Kingdom’s Financial Inclusion Centre, an independent research and policy innovation think tank dedicated to promoting fair, affordable financial services and an efficient, accountable financial system. Both speakers stressed the importance of sound lending practices, especially in light of the ongoing global economic crisis. Credit unions have an important role to play in maintaining economic stability, especially on behalf of their members, the speakers said. “In analyzing the causes of the financial crisis, it is clear one of the focal points has been the provision of unsustainable credit,” Bierecki said. “Credit unions have not been involved in the subprime market in the European Union. Instead, credit unions have operated with sound regulatory and internal standards in place that guarantee responsible lending to members.” The response to the session and the network's formation was positive among officials present at the breakfast, WOCCU said. “We welcome the launch of a new organization representing credit unions in Europe and look forward to working with them,” said Malcolm Harbour, chair of the European Parliament’s Internal Market and Consumer Protection Committee. In addition to WOCCU and NACSCU, WOCCU member groups that participate in the network include the Association of British Credit Unions Ltd.; the Central Federation of Romanian Credit Unions; the Estonian Union of Credit Cooperatives; the Irish League of Credit Unions; and Macedonia's FULM Savings House. The six European organizations represent more than 1,000 credit unions serving 5.5 million members. For more information, use the link.

Kansas CUs Altered CARD Act costs time money

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WICHITA, Kan. (10/16/09)--Credit unions in Wichita, Kan., and the Kansas Credit Union Association say that late changes to the federal Credit CARD Act cost local credit unions time and money, but they hope relief is on the way. This week the House of Representatives passed a bill that would undo provisions of the Credit Card Accountability Responsibility and Disclosure (CARD) Act that made it more costly for credit unions to provide open-end lending, according to The Wichita Eagle (Oct. 15). A last-minute provision slipped into the act before it was approved by Congress has affected credit unions' ability to offer open-end loan because they would be required to provide 21 day's notice in advance of the payment due date--a problem for credit unions that have members making weekly or biweekly payments on their loans. The Wichita-based credit unions said their members already know when their payments are due and how much they will have to pay as part of their open-end loan agreements. Bob Corwin, CEO of Meritrust CU, a $637 million asset credit union based in Wichita, told the newspaper that the law meant Meritrust had to conform with issues that aren't really relevant for open-end loans. It cost the credit union time and money to have staff manually preparing the required 21-day notices. "That was a big scramble and quite an expense we didn't have before," he told the Eagle. Meritrust doesn't have the capability to prepare the notices through an automated system. Central Star CU President/CEO Lee Williams noted that to comply with the new law, her $82 million asset credit union had to convert about 3,800 of its 4,000 open-end loans to closed-end loans. That took a full week of staff time devoted to nothing but transferring the loans, and Williams said it cost about $20,000 in man-hours and notifications to members. "This is not a year where you need that kind of impact," she said. The act also changed the payment due dates for members with open-end loans who chose their original dates based on their financial situations. Marla Marsh, CEO of the Kansas Credit Union Association, was also quoted in the article, saying she hoped the House bill, CARD Act Technical Corrections Act, would be passed by the Senate. That would remove open-end loans from the Credit CARD Act and allow credit unions to follow their usual processes.

Reaffirming CUs commitment on ICU Day

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MADISON, Wis. (10/16/09)--Every credit union celebrated International Credit Union Day in its own way, but many of the celebrants did so in ways that reaffirmed their commitment to their members. "International Credit Union Day is the one time each year we all step back and celebrate the value of the cooperative model as an alternative financial service provider," said Pennsylvania Credit Union Association (PCUA) President/CEO Jim McCormack. He commended the state's credit unions for "providing unparalleled value to consumers in a highly competitive marketplace."
Click to view larger image CUNA Mutual Group employees celebrate International Credit Union Day by spelling out TRUE to illustrate their commitment to credit unions. Their T-shirts, bearing the word TRUE, were sold to employees to raise money for the National Credit Union Foundation’s Development Education program, which helps credit unions leverage their commitment to cooperative principles as a competitive advantage in the financial marketplace. (Photo provided by CUNA Mutual Group)
Credit unions in Pennsylvania took efforts to make sure their members and the public knew about that commitment. Thursday's Harrisburg, Pa. Patriot-News featured an eight-page insert including articles about the history of credit unions, credit union philosophy, benefits of membership and credit union facts such as safety and soundness. PCUA and five credit unions sponsored the ads. In Ohio, credit unions were busy educating others, including their members. "I know it is not a holiday that is on many calendars," wrote Chris Blough, CEO of Wayne County Community CU, Smithville, Ohio, in an e-mail sent to members. "It hasn't made the 'Hallmark Holiday' status. Nobody (aside from those of us in the industry) will be throwing a party for it or sending a card. But that doesn't mean that ICU Day is a day that should go unnoticed." Blough celebrated Thursday by going to Waynedale High School and teaching three senior high classes the ins and outs of credit, "but this isn't just a one day thing for us," he said. "Two out of every three credit unions in Ohio provide some form of free financial education to their communities," Blough said. "That's more than 350 credit unions and communities that are strengthened because we know that the best financial tool out there is knowledge. Over 60% (and we are among them) of credit unions offer free one-on-one counseling to anyone, member or not, because we know that it is not right for those who know the least to get taken advantage of the most. Credit unions are a true community asset. Not a flashy one. Not a loud one. But a strong and stable one." In Delaware, credit unions published their eighth credit union supplement, with more than 120,000 copies inserted in Thursday's statewide newspaper, The News Journal, said the Delaware Credit Union League. The supplement highlights the difference between banks and credit unions, and directs consumers how to find a credit union to join. Credit union member testimonials underscore the value of belonging to a credit union (Together Oct. 15). "Most credit unions realize they need to tell the public who we are, to advertise credit union services, and to maintain visibility among members and potential members alike," said Alice Smith, Delaware league communications director. The publication was underwritten by the advertisements of 11 credit unions and features a directory of all 28 credit unions in that state. Credit unions in Georgia are celebrating ICU Day as well as the 100th anniversary of credit unions in the U.S. and the 75th anniversary of the Georgia Credit Union League by sharing "A Century of Good Advice," an online video featuring advice from both young and older Georgians. "By compiling testimonials of Georgians young and old about spending and savings habits over the years, Georgia credit unions hope to provide consumers with insight and inspiration for their own financial futures," said Michael Mercer, president/CEO of the Georgia Credit Union Affiliates (GCUA). Gov. Sonny Perdue Wednesday signed a special proclamation honoring ICU Day. And GCUA also released a poll on the savings and spending habits of consumers in the state. The poll results are available at the resource link. It found that: 46% of Georgians spend less than they did one year ago, and 41% spend the same. Of those polled, 65% say their personal spending habits will be changed forever because of the current recession. Roughly 53% say either their mother or father was the biggest influence in their lives about money, with 27% indicating the father and 26%, their mother. The Texas Credit Union celebrated ICU Day and its 75 years of service. According to President/CEO Dick Ensweiler, "Each and every one of us has a chance to demonstrate the positive impacts credit unions are capable of. I have seen the differences we are making, be it on a local level by establishing relief assistance for those ravaged by Hurricane Ike or on the larger scale of advocating for actions to be taken on the political fronts" (LoneStar Leaguer Oct. 15). "We operate under the mantra of 'people helping people' and I know of no better gift to our international credit union family than to commit to this philosophy for another 75 years," he said.

Canadas CUs donate 42.1M to communities

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TORONTO, Canada (10/16/09)--Canadian credit unions upped their support of community projects nationwide to $42.1 million in 2008. The amount was up 18% from the $35.8 million donated in 2007, a new survey indicated (Canada NewsWire Oct. 15). “During the recent tough economic times, credit unions have increased their support for local community projects,” David Phillips, president/CEO of Credit Union Central of Canada, told the news service. “Every day, credit unions help their communities by providing time, money and expertise. These actions flow from the cooperative principles that are at the core of the credit union difference.” Since its inception eight years ago, the annual survey has shown a steady increase in donations from Canada’s credit unions, the news service said. In a related matter, credit unions in the Canadian province of Ontario increased their support of community projects to a record $5.3 million in 2008--up roughly 10% from $4.8 million in 2007, said Central 1 CU, the central liquidity management facility and trade association for nearly 200 member credit unions in British Columbia and Ontario.

HarborOne CU flu strategy cancels holiday party

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BROCKTON, Mass. (10/16/09)--In preparation for a possible H1N1, or swine flu epidemic, Brockton, Mass.-based HarborOne CU has canceled its annual holiday party and is instead providing $25 gift cards to employees. “We realized that in December [when the pandemic could hit], we’re going to put 400 people together in a room, and that’s conflicting with things we’re telling people [about swine flu],” said Patricia Williams, HarborOne CU vice president of human resources. The credit union is reminding employees to wash their hands and has provided hand sanitizers. Williams told News Now that she hadn’t received any complaints about the cancellation of the party. “I think people are feeling our concern,” she said. HarborOne has already booked its holiday party for 2010. The credit union has been preparing for a flu pandemic for several months. It recently offered and paid for flu shots for employees. Flu shot participation was up 70%, Williams said. The credit union has offered shots for 10 years. HarborOne also is offering screenings for employees so that they can receive Tamiflu, a drug used to treat swine flu, on prescription. The credit union realized that it may not have access to the flu vaccine, so it is paying for employees to be screened. Employees’ family members also can receive the screenings and medication at a reduced cost. The screenings are being handled by an outside healthcare company, Williams said. No employees have reported being sick with swine flu, but there are several cases in the area, Williams said. HarborOne has $1.7 billion in assets.

CUs can help Latinos build assets--Filene report

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MADISON, Wis. (10/16/09)--Credit unions have an opportunity to reach out to the Latino community, which has a growing demand for transaction and savings products, according to a report released by the Filene Research Institution on the financial needs of the U.S. Latino population. The report, “U.S. Latino Families, Heads of Household and the Elderly: Emerging Trends in Financial Services and Asset-Building Behaviors,” focuses on the key features of the Latino financial experience. The Latino population presents unique opportunities, such as the incidence of multiple generations living under one roof, a lower-than-average age than the overall population and a higher frequency of married couples. Latinos are seeking products to build assets though individual development accounts, educational savings accounts, investment accounts and mortgages, the report said. “Credit unions can take advantage of this opportunity by crafting campaigns of community partnership and outreach, including niche marketing strategies that convey trust and continuity in a culturally sensitive manner,” said Filene Chief Research Officer George Hofheimer. In reaching out to Latinos, credit unions can:
* Be “language-friendly” by making sure members understand the products and services. This can be achieved through a new-member orientation, opposed to text-dense financial brochures that have little impact; * Offer bold and family-friendly credit union savings products, like dollar savings bonds, penny CDs, and rural savings bonds; * Partner with the community to provide financial education through high school equivalency degree classes and English as a Second Language courses; and * Provide “green” car or home loans that help bring energy-efficiency savings into low and moderate-income communities, and educate residents on predatory lending regarding auto loans and mortgages.
“Many of today’s most loyal credit union members had less-than-stellar credit when they first came to the credit union,” Hofheimer added. “And while the Latino population is neither the wealthiest nor the best credit risk, the sheer numbers and needs of this group make this a once in a lifetime opportunity.” The report, authored by researcher Barbara J. Robles of Arizona State University, was supported in part by the National Credit Union Foundation and its signature program REAL Solutions. For more information, use the link.

Vacant position on Ohio league board filled

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DUBLIN, Ohio (10/16/09)--Tina Wocher, CEO of Cincinnati Police FCU, has been appointed to fill a vacant spot on the Ohio Credit Union League board of directors. Wocher will fill a Membership Category B position, which represents Ohio credit unions with 7,500 to 21,999 members (eLumination Oct. 15). The seat was previously filled by Jim Hartman, who resigned from the board in August. Wocher’s term expires in 2010. She also was elected to the seat in the 2010 league board election and will serve a separate three-year term expiring in 2013, the league said.

Intense bike-building nets 24 bikes for kids

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PORTLAND, Ore. (10/16/09)--About 190 Unitus Community CU staff assembled bicycles for 24 members of the Portland Boys & Girls Club Monday in a three-hour race against time.
This young man was one of 24 recipients of a new bicycle from Unitus Community CU, Portland, Ore. Unitus employees assembled the bikes during a team-building exercise Monday. (Photo provided by Unitus Community CU)
Columbus Day traditionally is a holiday for many businesses. For Unitus, the date usually means all-staff training. However, this year it became “The Unitus Columbus Day Moving You Forward Conference: A Day for Teamwork and Collaboration.” The intense bike-building exercise tested the teams’ wit and creativity in building bikes that were wheeled out to surprise 12 boys and 12 girls from the club. None of the employees knew until the end of the exercise that the bikes they built would be donated to local youth. Teams assembled at 1 p.m. and attempted to have every last nut and bolt in place by the 3:30 p.m. deadline. At that time, Unitus President/CEO Patricia Smith and Sarah Fast, program director of the Regence Club in North Portland, welcomed the children. “We saw some great expressions of surprise because none of our employees knew why they were building the bikes, and the boys and girls did not know about the bicycles until they actually took their own and wheeled them away,” Smith said. “This is probably one of the most fun-filled and rewarding team-building experiences we’ve ever completed.” The program is not the first involving bicycles and Unitus. The credit union received widespread publicity last year when it announced a low, fixed-rate loan program for bicycle purchases. The loans target purchasers of commuter-quality bicycles who ride to work to save on gas and wish to protect the environment (News Now July 17). Unitus also collected used bicycles last year, and refurbished and donated them to low-income youth and adults.

Banks spend ICU Day educating youth about credit

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HARRISBURG, Pa. and WASHINGTON (10/16/09)--While credit unions celebrated International Credit Union Day Thursday, bankers took on their own project aimed at educating young adults about credit. The Pennsylvania Credit Union Association calls their project "an attempt to steal the Credit Union Day spotlight" (Life is a Highway Oct. 16). For the seventh year, bankers have organized a Get Smart About Credit Day, which falls on International Credit Union Day. The event focuses on educating young adults about wise use of credit. Many adults under age 21 will be prevented from getting a credit card without a parent co-signor or proof of independent income by a new law that becomes effective in February. Roughly 3,000 bankers and students were to participate in lessons on developing good credit habits. The "Get Smart About Credit" website also featured a young woman saying a line that should sound familiar to all credit unions who've been educating the public and lawmakers about the credit union difference for years. She tells the bank website visitors: "Bankers, you make a difference."

CU System briefs (10/15/2009)

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* TOPEKA, Kan. (10/16/09)--Two established credit unions in Topeka, Kan.--Credit Union 1 of Kansas and Credit Unions United (formerly Rubber Workers CU)--announced plans to consolidate operations. The merger is pending a Nov. 4 vote of the membership and approval by the Kansas Department of Credit Unions and the National Credit Union Administration. Both credit unions said they have strong capital and efficient operations. However, given the challenges of competing and growing in the current economic climate, the boards of directors said they believe that consolidating will make for a stronger organization, better-positioned for future growth and success. “This is a strong consolidation of two healthy credit unions,” said Vickie Hurt, president/CEO of Credit Union 1. “By joining forces as one organization, members of the ‘new’ credit union will be able to take advantage of the economies of scale that will promote efficiency, as well as favorable rates and fees” … * COLUMBUS, Ohio (10/16/09)--Political leaders from Mahoning Valley, Ohio, visited with representatives of several credit unions at the Mahoning Valley Chapter's annual Legislative Forum Golf Outing and Reception, according to the Ohio Credit Union League (eLumination Newsletter Oct. 14). Among the special guests were U.S. Rep. Tim Ryan (D-Niles), State Rep. Ronald Gerberry (D-Austintown), Trumbull County Commissioners Frank Fuda and Dan Polivka, Warren Municipal Court Judge Tom Gysegem, Austintown Trustee Lisa Oles, and Deputy Superintendent for Credit Unions for the Ohio Division of Financial Institutions Rose Bartolomucci. The event provided legislators with an opportunity to learn more about credit unions and discuss state and national legislation modernizing laws pertaining to credit union operations and their ability to offer greater services, said the league. From left are Paul Mercer, president of the league; Congressman Ryan; Mike Kurish of Associated School Employees CU, Youngstown; and Gary Soukenik of Seven Seventeen CU, Warren (Photo provided by the Ohio Credit Union League) … * BAKERSFIELD, Calif. (10/16/09)--Kern Schools FCU in Bakersfield, Calif., has selected Steve Renock to replace president/CEO Vince Rojas, who will retire in January. Renock will begin work at the credit union Monday (Bakersfield.com Oct 14). Renock previously worked as executive vice president of lending at SchoolsFirst FCU, president/CEO of CUNA Mortgage Corp., and senior vice president and national wholesale manager and controller of Shearson Lehman Mortgage Corp. Kern Schools FCU has $1.730 billion in assets ...

Summerall elected to board of Southeastern league

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BIRMINGHAM, Ala. and TALLAHASSEE, Fla. (10/16/09)--Ron Summerall, CEO of Alabama Teachers CU in Gadsden, Ala., was elected Oct. 9 to fill the vacant Class C seat on the board of the League of Southeastern Credit Unions (LSCU). “Ron is very involved at the chapter level and has a great interest in legislative and regulatory advocacy, which will make him a valuable addition,” said Patrick La Pine, LSCU president/CEO. Summerall served as CEO of Alabama Teachers CU for more than 14 years. Under his leadership, the credit union tripled in size. Summerall also was recently honored as the Alabama Credit Union Manager’s Association “CEO of the Year.” Voting for the seat was open to all affiliated credit unions in Alabama, and began Sept. 28 and closed Oct. 9. The LSCU board consists of eight representatives from Alabama credit unions and eight from Florida credit unions. Current directors will serve staggered terms. The LSCU represents 332 Alabama and Florida credit unions.

Scam suspect nabbed via his Facebook page

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SEATTLE (10/15/09)--A man suspected of conning Seattle banks and credit unions is in a Mexico City jail awaiting extradition to the U.S. after he did two things that helped nab him. He posted Facebook updates about his partying lifestyle while on the lam, and added a former Justice Department official to his list of "friends." Maxi Sopo, 26, a native of Cameroon, was a fugitive enjoying the beaches of Cancun by day and partying at clubs at night, according to several press reports (Associated Press via Google.com Oct. 13). The Justice Department acquaintance had met Sopo at a local club. Investigators recognized the name and contacted the official for help in locating and capturing Sopo. Federal prosecutors say he and an associate, Edward Asatoorians, falsely obtained more than $200,000 from Seattle-area credit unions and banks. Asatoorians was convicted by a federal jury in Seattle last week. According to court records, the pair persuaded young co-conspirators to lie about their income to obtain loans for fabricated auto purchases and then used the money to prop up Asatoorians' business and take expensive trips. Asatoorians faces up to five years in prison, and Sopo could face up to 30 years.

CU Student Choice to address bankers on student loans

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WASHINGTON (10/15/09)--Serving as testimony to the expanding role and increasing influence of credit unions in private student lending, Credit Union Student Choice President Jon Jeffreys will be a speaker at the Consumer Bankers Association's (CBA) Student Lending Conference in December. During a joint session with representatives from other industry leaders, Jeffreys will address the future of private student lending market and the successful entry of credit unions into the market. Since launching 17 months ago, Credit Union Student Choice has helped nearly 90 credit unions from across the country enter the private student lending market, Jeffreys said. "By leveraging their balance-sheet lending capability and focusing on economic value, these credit unions have helped nearly 10,000 students attend college at a time of critical need," he said in a press release Tuesday. Jeffreys said the conference provides an important venue for educating the industry on credit unions and their unique differences. "The student lending and higher education industries are beginning to take note of the positive impact that credit unions are having on this market," said Jeffreys. "I look forward to sharing our vision and explaining how credit unions will redefine value in private student lending." The CBA Student Lending Conference will be Dec. 9-11 in Washington, D.C. It provides guidance on key legislative, regulatory and business issues affecting the student lending industry.

CUNA CUs celebrating choice on ICU Day

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MADISON, Wis. (10/15/09)--This year’s International Credit Union Day theme--Your Money. Your Choice. Your Credit Union--celebrates choice, which is what gave birth to the credit union as a not-for profit, cooperative alternative to for-profit, investor-owned banks, according to Credit Union National Association President/CEO Dan Mica. Today is ICU Day. It has been celebrated on the third Thursday of October since 1948 to celebrate what credit unions do to improve their members’ financial well-being, Mica said. “Whether it is opening that first account for a child, arranging financing on a used car, making a small-business loan, holding a seminar on improving credit scores or opening a branch in a community without financial services, credit unions play a role in changing lives,” he added. “As we celebrate International Credit Union Day, we recommit to the credit union spirit of unity and service to members,” Mica said. “We also look to spread the credit union idea to the millions in the U.S. and abroad who are yet unfamiliar with our philosophy and benefits so that they may discover what millions already know: When you are a member, it really is your credit union.” On ICU Day, credit unions are recommitting to the credit union spirit of unity and service to members and spreading the credit union philosophy to those in the U.S. and overseas. The World Council of Credit Unions (WOCCU) is kicking off its celebration with a “Celebrating Our Heritage” webinar, led by WOCCU President/CEO Pete Crear. The webinar takes place at 2 p.m. EDT today. “The role credit unions play has gained even greater importance this past year in light of the global financial crisis, which continues to negatively affect our members worldwide,” said Barry Jolette, WOCCU chair. “The strength and empowerment that comes through cooperative financial ownership cannot be underestimated, making credit union access more critical to members than ever before.” Jolette also echoed Mica’s thoughts about the importance of choice. “On ICU Day and every day, credit union involvement is a choice we have made,” he said. “It remains the responsibility of each of us to make sure the world understands the value of credit unions so that next year, even more people will be served by credit unions.”
Click to view larger image In the Florida governor’s office to witness the International Credit Union Day proclamation signing were, (from left) Andy Price, League of Southeastern Credit Unions (LSCU); Amy Jowers and Justin Thames, LSCU; Florida Attorney General Bill McCollum; Ray Cromer, Envision CU; Cecilia Homison, Florida Commerce CU; Florida Gov. Charlie Crist; Patrick La Pine, LSCU president/CEO; Aletta Shutes, former Florida Credit Union League executive vice president; Florida Chief Financial Officer Alex Sink; Guy Hood, former league president/CEO; Florida Commissioner of Agriculture Charles Bronson; Sandra Hood; Mark Landreth, LSCU and Cassandra Grayson, LSCU; and Mary Estes, Florida Commerce CU. (Photo provided by the League of Southeastern Credit Unions)
Washington Gov. Chris Gregoire proclaimed today as Credit Union Day in the state to celebrate the 75th year of the Washington Credit Union League. This is the fifth consecutive year the governor has proclaimed ICU Day as Credit Union Day. Several credit unions, including O Bee CU in Tumwater and Evergreen Direct CU in Olympia, also are participating in a contest that honors the 75,000th new credit union member with gift certificates and prizes. More than 67,000 Washingtonians joined credit unions by the end of June, and 75,000th person is expected to join during the remainder of the year (The Olympian Oct. 13). The Maryland and District of Columbia Credit Union Association is hosting a reception today at Credit Union House in Washington, D.C., with guest speakers including National Credit Union Administration board member Gigi Hyland and Mica. The association also will celebrate its international partnerships with the United Kingdom and Nicaraguan credit union movements (Focus newsletter Oct. 12). BECU, Tukwila, Wash., is reaching out to college students this week by teaching them how to manage their finances and avoid scams. The BECU Mobile Financial Center will lead the “GO BECU Tour” with visits to four college campuses around Puget Sound, Wash., to teach students about money. The average college student graduates with between $3,000 and $4,000 in credit card debt, according to the credit union. “The ‘Go BECU Tour’ is about making sure students know their options and understand how to navigate the confusing financial landscape,” said Gary Oakland, BECU CEO. Alabama and Florida state government declared today as ICU Day. The League of Southeastern Credit Unions (LSCU), in honor of its Alabama and Florida member credit unions, created a proclamation that recognized accomplishments of the credit union movement, and submitted it for signature to the governors of both states. “We at LSCU wanted to highlight in a public way the many reasons why people choose credit unions for access to fair and affordable financial services,” said Patrick La Pine, president/CEO of LSCU. “Credit union members reap the benefits of doing business with a financial institution they own--one focused on service to its members, not profits for its stockholders. That means value, service, respect, and the opportunity to be part of a financially sound and socially responsible institution.” In Alabama, Gov. Bob Riley signed the proclamation. In Florida, Gov. Charlie Crist and members of the Florida Cabinet signed and presented the proclamation at a Sept. 29 cabinet meeting. Retired Florida league leaders Guy M. Hood, former president/CEO, and Aletta Shutes, former executive vice president, were also honored for their many contributions to the credit union movement. Both retired from the league in August and July, respectively.

Alabama regulator hires CEO for Mutual Savings CU

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BIRMINGHAM, Ala. (10/15/09)--The Alabama Credit Union Administration (ACUA) has announced a new CEO for Mutual Savings CU, a Birmingham-based credit union that was placed into conservatorship in July after several loan losses. Douglas Key, the founding owner of law firm of Key Greer Frawley Key & Harrison, plans to transition out of his law practice and assume the CEO responsibilities of the credit union (Birmingham Business Journal Oct. 14 ). Glenn Latham, administrator of ACUA, said Douglas and a seasoned staff will work to lead the credit union back to a healthy and growing state (The Birmingham News Oct. 13). Key has worked with credit unions in various roles for more than 35 years, said Latham. State regulators seized control of the $193 million asset credit union on July 31, saying its former leaders misrepresented the credit union's financial condition in regulatory filings. Former CEO Dale Dalbey and several board members ousted during the conservatorship action are seeking an injunction against the takeover in Shelby County Circuit Court. A hearing on the issue is set for Oct. 26.

Rep. Cleaver meets with Kansas City CUs on CFPA

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KANSAS CITY (10/15/09)--U.S. Rep. Emanuel Cleaver (D-5) of Missouri asked for credit union input on the Consumer Financial Protection Agency (CFPA) legislation during a meeting in Kansas City on Tuesday. Ten credit union leaders and several bank professionals took part in the event, according to the Missouri Credit Union Association (MCUA). Credit unions requested two changes. First, to allow the National Credit Union Administration or the Missouri Division of Credit Unions to examine credit unions for compliance and carry out enforcement of the regulations. Second, that CFPA pre-empt state laws on consumer protection to lessen the burden of keeping up with laws and regulations in multiple states (The Missouri difference Oct. 14). Bank representatives asked for a carve-out for community banks and for current consumer regulations, but Cleaver said that would not be possible. He said he expects the CFPA legislation could pass before year-end. “Your high school teacher might have told you that 80% of everything is showing up, and that holds true for politics,” said Peggy Nalls, senior vice president of public/legislative affairs for MCUA. “We showed up and the congressman gave us over an hour and a half of his time and attention to discuss our issues regarding the CFPA legislation. Cleaver also requested a separate meeting with credit unions to discuss interchange fees. MCUA said it will provide more information to its member credit unions as soon as possible.

SECU piles on another 25 million for student loans

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RALEIGH, N.C. (10/15/09)--State Employees’ CU (SECU) invested $1.6 billion of members’ funds in North Carolina student loan bonds during the past year. The bonds helped the North Carolina State Education Assistance Authority (SEAA) and College Foundation, Inc. (CFI) make education loans available to North Carolina students and parents. The credit union has committed an additional $25 million pool of funds to help meet the greater demand for student loans for this school year. “We are grateful that SECU stepped up to help make money available, and we also appreciate its genuine interest in helping educate families about the best ways to pay for college,” said Steve Brooks, SEAA executive director. “Families need to understand the college financial aid process and how to find available federal and state scholarships, grants and low-cost federal loans before they consider other options. They also need a solid foundation in financial literacy to make good choices.” “SECU firmly believes that helping North Carolinians get an education is one of the best and most important investments we can make,” said Mike Lord, SECU senior vice president of finance and accounting. “Education opens up opportunities for individuals to increase their incomes and improve the quality of their lives. We support the College Foundation of North Carolina (CFNC) effort to help North Carolina families ‘plan, apply and pay for college.’” The two North Carolina private, nonprofit financial institutions and SEAA also are planning for SECU to help families with questions on completing the Free Application for Federal Student Aid (FAFSA). Students and parents must complete a FAFSA form to be considered for federal and state aid for college. SECU will help CFNC and the North Carolina Association of Financial Aid Administrators offer FAFSA Day at sites statewide in February. SECU, based in Raleigh, N.C., has $16.7 billion in assets.

Matchsavings.org ICU Day donations help rural poor

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MADISON, Wis. (10/15/09)--MatchSavings.org, an online matched savings program launched earlier this year by the World Council of Credit Unions (WOCCU), will participate in America’s Giving Challenge to help the rural poor in Mexico for International Credit Union (ICU) Day.
Click to view larger image Lucrecia Alejo Morales joined the MatchSavings.com program to replace the leaky cardboard roof on her one-room home. (Photo provided by the World Council of Credit Unions)
The program, MatchSavings.org, could net up to $50,000 based on the number of daily donations made to MatchSavings.org before Nov. 6. The challenge starts today on social networking site Facebook. The cause with the highest total number of daily donations will receive $50,000, and $25,000 will go to the second-place winner. The next five causes will receive $10,000 each. There will be two daily awards of $1,000 and $500 going to the causes with the first and second most unique donations on any day of the challenge. “It would be an outstanding achievement for this program if we could see as many credit union people as possible from all over the world supporting MatchSavings.org on ICU Day,” said Brian Branch, WOCCU executive vice president and chief operating officer. “It is a great opportunity to leverage funds through social networks that can help even more people living in poverty begin to save for the first time. We can’t afford to let that opportunity pass us by.” MatchSavings.org recently completed its pilot phase, in which 117 rural savers became new members of Caja Yanga CU in Mexico's Veracruz state. Savers made six set monthly deposits for a particular savings goal. The amount was later matched to help them with housing, microbusiness, education or healthcare. Of the 120 participating savers, 83% had never used formal financial services, 98% completed the program and 99% continue to save even after the program has ended. “I never saved money, but the program has shown me how to save for the future and teach my children how to save as well,” said participant Guadalupe Jazmín, who saved funds for additional therapy sessions for her daughter with special needs. “Unfortunately, no one knows what will happen tomorrow, but this way my children will understand that through savings, they can depend upon themselves.” With the pilot phase complete, 120 new first-time savers from eight communities in Veracruz state begin the MatchSavings.org program today. Savers will select savings goals and be required to save 900 pesos--or $70--over six months, an amount to be matched by donations received through MatchSavings.org and the Facebook cause. Once the savers have completed the requirement, they can use their funds in addition to the matching amount pledged by online givers to achieve their goals.

CU System briefs (10/14/2009)

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* MADISON, Wis. (10/15/09)--Madison, Wis.-based Summit CU offered congratulations on the Credit Union National Association's
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(CUNA's) 75th year--in the form of cookies. Jeremiah Gollon, Summit CU business development manager, delivered boxes of cookies Wednesday to CUNA's Madison staff and a bouquet style basket of cookies presented to CUNA's executive team. From left are Harley Skjervem, CUNA senior vice president of human resources and facilities; Terry Costin, CUNA senior vice president of sales and marketing; Gollon; John Franklin, CUNA executive vice president and chief operating officer; and Mark Condon, CUNA senior vice president of business and consumer publishing. Summit was formerly CUNA CU. (Photo provided by CUNA) … * ALBANY, N.Y. (10/15/09)--Niagara County's FCU, based in Lockport,
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N.Y., was presented the 2009 Ralph W. Hillman Marketing Award from Universal Sharing Network Inc. (UsNet). The award recognizes a participating UsNet credit union for best exemplifying the spirit and enthusiasm of Hillman, a former chairman of the board at UsNet and a board member since 1998. The credit union "consistently promoted the network to its members via its website, printed materials and newsletter throughout the year, emphasizing the convenience and accessibility of shared branching," said Marc Inger, UsNet chief operating officer. Pictured during the award presentation are from left: Paul Roman, chairman of the board at The $40 million asset Niagara County's FCU, and Inger. (Photo provided by Universal Sharing Network) … * MILFORD, Conn. (10/15/09)--Sikorsky Financial CU has been held up twice within the past two weeks. The latest robbery occurred Tuesday during the lunch hour when three armed men entered the credit union through the rear door. One approached tellers and demanded money while another went into an office and ordered an employee to lie on the floor. The robber took money from the employee before the three fled in a car. No one was injured, but one employee was treated at a hospital for complications from a pre-existing medical condition. On Sept. 28, a lone male held up the branch. Police have not ruled out a connection between the two incidents (Connecticut Post Oct. 13 and The New Haven Register) …. * BROCKTON, Mass. (10/15/09)--Although location, location, location is touted as a way to attract members, location also can attract robberies, says a Brockton, Mass., detective. Crescent CU's branch located on West Chestnut St., Brockton, Mass., has been robbed four times since April, and police said the location may appeal to robbers. The latest robbery occurred Tuesday morning when an unarmed man gave the teller a note, then demanded it back. The branch is located outside the center of the city and within easy access to Route 24--two factors appealing to thieves--and the area has lots of vehicless and few pedestrians, said police. The credit union was also robbed on April 15, April 28, and July 22. One man has been charged with the April holdups and another for the July heist. (wickedlocal.com Oct. 14) … * RUSK, Texas (10/15/09)--Southern Cherokee FCU, a $30 million asset credit union in Rusk, Texas, says it will be getting a new name--Cherokee County FCU--as part of its new charter. The charter will expand the credit union's services to those who work, live or worship in the entire Cherokee County. Before the new charter, it served only those in the southern part of the county. The credit union was established 50 years ago to serve employees at Rusk State Hospital. It has 4,700 members (Cherokeean Herald Oct. 14) …

Two presidential speechwriters laud CUs

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FREEPORT, Maine (10/15/09)--The Maine Credit Union League’s Annual Legislative Forum this year marked its 15th annual forum with two former presidential speechwriters who were involved in some of the 20th century’s most historic events.
Click to view larger image Attending the Maine Credit Union League’s 15th Annual Legislative Forum were, from left: John Murphy, league president; Mark Davis, senior director of The White House Writers Group and former speechwriter for Presidents Ronald Reagan and George H.W. Bush; Ted Sorensen, special counsel and speechwriter for President John F. Kennedy; and Quincy Hentzel, league director of governmental affairs. Standing in back is Jon Paradise, league governmental and public affairs manager. (Photo provided by the Maine Credit Union League)
Keynote speaker Theodore “Ted” Sorensen, special counsel and speechwriter to President John F. Kennedy (JFK), provided the audience a glimpse into policymaking and communicating at the highest levels of government. In his address, Sorensen reiterated the importance of “being involved in politics and causes and understanding that words do matter. I applaud all of the credit union representatives for being part of a strong movement,” he said. “It was truly a rare opportunity to hear and learn about history from someone who was part of it,” said John Murphy, league president. “Mr. Sorensen has led a fascinating life and his ability to recall days and dates of events in history--from the Cuban missile crisis to civil rights to the tragedies in the Kennedy family--was remarkable and a once-in-a-lifetime experience for attendees. They seemed to hang on Sorensen’s every word as he explained and recalled his part in such historical events as the Cuban Missile Crisis--the closest we have ever come, before or since, to nuclear war in the history of the world.” Sorensen also shed light on some of JFK’s most memorable speeches including the 1961 Inaugural Address, the Cuban Missile Crisis and Civil Rights. “While I have done a great deal of work with world leaders, business and global initiatives since I left The White House in 1964, I have no doubt that the headline of my obituary will read: ‘Ted Sorensen, JFK's speechwriter’,” Sorensen said. “And you know what, I’m comfortable if that is how I am most remembered.” Sorensen was not the only presidential speechwriter at this year’s forum. Mark Davis, who wrote speeches for President Ronald Reagan and served as the chief speechwriter on foreign policy, including several speeches on the collapse of communism and the first Gulf War, for President George H.W. Bush, headlined the afternoon portion of the forum. Davis focused not only on how he approached writing for presidents, but also shared tips and advice for anyone writing and giving a speech. Davis also referenced how proud credit unions should be for being a source of strength during difficult economic times.

CU System briefs (10/13/2009)

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* HARRISBURG, Pa. (10/14/09)--Pennsylvania Gov. Ed Rendell signed the state budget Friday night. The $27.8 billion plan ends a 101-day state budget stalemate that prompted credit unions to offer special assistance programs to their members affected by the impasse. The plan is more than $500 million less than last year's $28.3 billion budget. A key provision involving table games legislation is expected to pass this week, said the Pennsylvania Credit Union Association (Life is a Highway Oct. 13) … * WESTBORO, Mass. (10/14/09)--Tina M. Sbrega has been appointed to the Massachusetts Credit Union Share Insurance Corp. board of directors (Telegram.com Oct. 11). Sbrega is president/ CEO of GFA FCU, a $298 million asset credit union based in Gardner. It has eight branch offices. Sbrega also is a trustee for Mount Wachusett Community College and Heywood Hospital, both based in Gardner … * PHOENIX (10/14/09)--Desert Schools FCU and Phoenix police are seeking the public's help in identifying a man who is running scams against financial institutions and businesses in the area. The $3.346 billion asset credit union said Monday a man has entered three of its branches asking to exchange $20 bills for larger denominations in multiple transactions. He then claims he was short-changed and tries to get that money from the tellers. He has hit two branches in Mesa and one in west Phoenix. (Phoenix Business Journal and abc15.com Oct. 12) … * SYRACUSE, N.Y. and ROCHESTER, N.Y. (10/14/09)--Syracuse (N.Y.) FCU said its members voted Oct. 7 to merge with Summit FCU, Rochester, N.Y. On April 1, the credit unions will do business under the name of The Summit--which will have 80,000 members, 18 locations and $625 million in assets (The Post-Standard Oct. 10) … * TAMPA, Fla. (10/14/09)--Invest Financial Corp.--a full-service broker-dealer based in Tampa--appointed former CUNA Mutual Group executive Steve Dowden to be Invest’s new president/CEO. Dowden succeeds Lynn Niedermeier who retired in July. Dowden was senior vice president of distribution and president/CEO of CUNA Brokerage Services, quarterbacking a sales force of 550 advisers and responsible for all sales in CUNA Brokerage’s asset accumulation division (Tampa Bay Business Journal Oct. 12) …

Belarus plans CU expansion

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MINSK, Belarus (10/14/09)--Elena Koleda has turned to the World Council of Credit Unions (WOCCU) and the National Association of Cooperative Savings and Credit Unions (NACSCU), WOCCU's member organization in Poland, for assistance in developing more credit unions in her native Belarus.
Elena Koleda (left), head of Belarus' credit union trade group, stresses the importance of credit union growth to Pawe³ Grzesik of the National Association of Cooperative Savings and Credit Unions. (Photo provided by the World Council of Credit Unions)
"Our top priorities are staff training, credit union accounting software and credit union legislation," said Koleda, manager of the Republican Association of Consumer Cooperative Societies for Mutual Financial Assistance, the trade association representing credit unions in Belarus. The efforts would help the Eastern European country's existing eight credit unions grow as a movement to a size necessary to become a more formidable influence in serving Belarus' population. "By forming an association, Belarus' credit unions were able to brand their institutions and pool their resources to reach the greater levels of efficiency necessary to grow a credit union movement," said Brian Branch, WOCCU executive vice president and chief operating officers. Branch was in Belarus last week to work with the country's credit unions and speak to lawmakers about drafting legislation supporting financial cooperatives. At the urging of the United Nations, WOCCU first looked into developing credit unions in Belarus in 1997. During subsequent years, NACSCU's foundation provided support necessary to develop the country's first financial cooperatives. Belarus' trade association was formed in 2007. Currently, the country's credit unions serve professionals and small business owners in the capital city of Minsk, as well as rural communities across the country. Many of the movement's leaders are self-employed small business owners who felt neglected by the country's banking system. By turning to a cooperative model, they can be assured they will have a voice in the financial activities that affect their enterprises, said Pawe³ Grzesik, plenipotentiary head of NACSCU's Warsaw office. Grzesik joined Branch during his visit. The Belarus movement "is one of the best examples of genuine bottom-up efforts to build a civil society in Europe today," Grzesik said. During their visit, Branch and Grzesik participated in an international financial conference designed to raise the profile of credit unions among the public, lawmakers and the press. They stressed credit unions' role in helping consumers and small business owners gain access to financial services at more affordable rates. Also, Grzesik is helping Belarus National Bank officials develop credit union-specific regulations that will enable the movement to grow. "[National Bank] Deputy Chairman Vasily Matyushevsky believes that the assistance of WOCCU and NACSCU is critical to developing the credit union sector in Belarus," Grzesik said. "He encouraged our further involvement in building the capacities of both the credit unions and their association through training and study tours to neighboring countries, including Lithuania and Poland." Because of geographic proximity, NACSCU will lead the development in Belarus, said Branch. "We have offered NACSCU our support due to its success in assisting other emerging movements throughout the region," he added. "Belarus is one more example of our two organizations' abilities to work together to foster credit union development on a global scale."

Economys impact topic at Mich. leagueregulators talk

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LANSING, Mich. (10/14/09)--The Michigan Credit Union League (MCUL) met with senior officials of the Credit Union Division of Michigan's Office of Financial and Insurance Regulation (OFIR) last week to discuss concerns and trends in the state's credit union industry during a tough economic period.
Michigan Credit Union League Vice President of Information Services Mike DeFors discusses the economy's impact on Michigan credit unions with Office of Financial and Insurance Regulation Deputy Commissioner Roger Little at an Oct. 5 meeting. (Photo provided by the Michigan Credit Union League)
League officials met with OFIR Deputy Commissioner Roger Little and Assistant Director John Kolhoff Oct. 5 (Michigan Monitor Oct. 12). They discussed several topics, including proper underwriting expectations, recordkeeping and reporting of modified residential loans using generally accepted accounting principles (GAAP). OFIR reported that credit unions' capital levels appear fairly stable for Michigan credit unions. However, the agency has seen an uptick in the "watch list" and expects that trend to continue when September call report numbers are released. OFIR also expressed concern about the growth of commercial loans taken on by credit unions after the borrower had been previously turned down by commercial banks. The meetings "continue to prove effective in keeping abreast of where Michigan credit unions stand with our state regulator," said MCUL Vice President of Information Services Mike DeFors. He termed the conversation with Little and Kolhoff as constructive and "about the positives and areas of concern for credit unions as economic times remain hard. This kind of dialogue is important in keeping lines of communication open between the regulator, the MCUL and all Michigan credit unions." The meetings help raise awareness of issues useful to league representatives visiting credit unions and planning educational sessions and articles. During the meeting, Little reiterated that CEOs should contact his office to discuss any unresolved differences regarding exam issues or unprofessional examiner conduct. The league also scheduled a similar meeting for this week with Andrew Healey, supervisory examiner of the National Credit Union Administration, and said similar meetings with credit union regulators will take place next spring.

CUs good alternative to payday loan trap IWash. PostI

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WASHINGTON (10/14/09)--The Washington Post cited a Chicago credit union’s payday loan alternative product as an example of innovation by the private sector in serving the unbanked in an article published Tuesday. North Side Community FCU offers members a six-month, $500 loan with a 16.5% interest rate. The credit union has made 5,000 loans since it introduced the loan several years ago, the Post said. The credit union doesn’t profit from its payday lending alternatives, but it hopes to help place members into good financial standing so they can then apply for profitable products--such as auto loans, credit union manager Ed Jacob told the Post. The article noted Congress is debating over the creation of a Consumer Financial Protection Agency, which is slated to provide federal oversight of the financial industry. Some industry representatives are opposed to the agency, saying that innovation is the key to reform, instead of legislation, the Post said. Many credit unions offer payday lending alternatives for their members. Several states, including Michigan, Arizona, Ohio and others have passed or are working on pieces of legislation that would restrict payday lenders, which routinely charge borrowers high interest rates. A payday lending group issued a release Tuesday indicating that the premise of the Post's article--that individuals who borrow from payday lenders are not banked--is inaccurate. Borrowers who receive loans from payday lenders are considered "banked," the group said. To read the full Post article, use the link.

Transactions to exceed 100 billion for first time

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LAKE BLUFF, Ill. (10/14/09)--Credit unions will have to plan for members’ greater electronic payment use because the number of checks and electronic transactions for debit cards, credit cards and automatic payments is expected to exceed 100 billion by the end of the year--the first time in U.S. history, according to an Illinois financial industry research firm. “[Based on the data], we believe there will be implications to the bottom line of financial institutions in pricing, fee structure and service delivery,” said Mike Moebs, CEO of Moebs Services, a research firm in Lake Bluff, Ill. The volume represents all transactions from consumers and businesses. It is based on research and projections conducted by Moebs Services, which used Federal Reserve data ranging from 1979 to 2006. Transactions in 2009 are expected to break down as follows:
* Debit card transactions, 33%; * Paper checks, 24%; * Credit card transactions, 23%; and * Automatic payments, 20%.
One interesting item about the projected 100 billion transactions is that “they do not represent an increase in U.S. consumer spending, which began declining in 2008 and is still not back on track as we approach year-end,” Moebs said. “This research indicates that consumers are doing significantly more transactions for significantly fewer dollars than in the past. This may be due to easy electronic payment methods replacing cash,” he added. The changes in payment trends mean that credit unions and other financial institutions will see reduced overdraft revenue from consumers using fewer paper checks. Paper check volume has dropped to 25% of transactions from 85%, Moebs said. Financial institutions also will have to secure their online electronic payment systems to prevent fraud, and ensure that their electronic communications can manage the increasing volume of transactions without errors, Moebs added.

N.J. league honors CUs for philosophy action more

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ATLANTIC CITY, N.J. (10/14/09)--More than 700 credit union leaders attended the New Jersey Credit Union League’s (NJCUL) annual meeting and convention Sept. 22 in Atlantic City to discuss credit union issues and to honor several credit union leaders.
Click to view larger image A panel discussion with, from left, Jim Blaine, president/CEO, State Employees’ CU, Raleigh, N.C.; Paul Gentile, president /CEO, New Jersey Credit Union League; and Dennis Dollar, former chairman, National Credit Union Administration, discussed overdraft protection, the future of the corporate credit union system, and the Community Reinvestment Act at the New Jersey league’s 75th annual meeting and convention, Sept. 20-22 in Atlantic City. (Photo provided by the New Jersey Credit Union League)
The conference was attended by 85 credit unions and featured 69 vendors (The Weekly Exchange Oct. 5). The 2009 NJCUL award-winners were announced at the convention. They included:
* Desjardins Youth Financial Literacy Award--First Financial FCU, and Raritan Bay FCU, Sayreville; * Dora Maxwell Social Responsibility Recognition Award--Jersey Shore FCU, Northfield; * Louise Herring Award for Philosophy in Action --Jersey Shore FCU; * CEO of the Year--Ann South, president/CEO, Novartis FCU, East Hanover; * Alexander Kosobucki Promotion Award--First Financial FCU, Toms River; and Hamilton (N.J.) Horizons FCU; * Catherine Miller Newsletter Award--Affinity FCU, Basking Ridge; Campbell Employees FCU, Cherry Hill; and Hamilton Horizons FCU; and * The Website Award--Aspire FCU, Clark; and Hamilton Horizons FCU.

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.

Conn. league CEO addresses reg challenges in biz journal

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MERIDEN, Conn. (10/12/09)--Credit Union League of Connecticut President/CEO Tony Emerson was spotlighted Oct. 9 in the Hartford Business Journal in a question-and-answer feature. Emerson addressed the burden of regulatory changes that credit unions face today and regulatory challenges they anticipate for 2010. He noted that in light of today's regulatory and compliance burden on financial institutions, credit unions--no matter their asset size--are all expected equally to comply with heavy regulation demands. The Journal was particularly interested in the league's new Compliance School, scheduled for February through July and which covers major regulatory compliance issues, he said. The league's Small Credit Union Support Program is subsidizing the costs so credit unions with less than $20 million in assets can attend free, he said. The league also has scheduled a compliance forum for November, he added.

Developers lose lawsuit vs. IH Miss. Valley CU

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DAVENPORT, Iowa (10/12/09)--Two property developers involved in a failed condominium complex lost their $16 million lawsuit against Moline, Ill.-based IH Mississippi Valley CU, on all six counts. The suit was filed by Cypress Point Developments, operated by Niky and Thomas Bowles, after the credit union filed for foreclosure against them. They claimed the credit union wanted out of a $3.5 million loan to develop the complex in Davenport, Iowa, because it had locked in a lower interest rate (News Now Sept. 30). The credit union countered that the Bowleses knew the provisions of the loan called for six-month extensions. But a Scott County District Court judge and jury ruled last week in favor of the credit union (Quad-City Times Oct. 8). The decision now clears the way for the court to determine whether the foreclosure should be placed on the property. Trial judge Mary Howes ruled in favor of the credit union on three of the six counts before the case went to the jury. The jury ruled in favor of the credit union on the final two counts after an eight-day trial and two hours' deliberation. The six counts were: breach of contract, interference with third-party contracts, negligent misrepresentation, fraudulent misrepresentation, breach of fiduciary duties and slander. The condominium project has spawned several lawsuits from contractors, most of whom won. The property has nearly 10 years of lawsuits, land disputes and zoning fights.

CUs ready for Thursdays big event ICU Day

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MADISON, Wis. (10/12/09)--This week is Credit Union Week, and Thursday credit unions will celebrate their efforts for the 61st consecutive year on International Credit Union Day--always on the third Thursday of October--which is also National Cooperative Month. This year's theme, "Your Money. Your Choice. Your Credit Union," celebrates why 177 million people worldwide choose credit unions. The event is sponsored by the World Council of Credit Unions and the Credit Union National Association (CUNA). Credit unions are already reporting what they will do to celebrate this week, and officials in several cities and states have issued or will issue special proclamations recognizing credit unions. For example, Idaho Gov. C.L. "Butch" Otter last week proclaimed Oct. 15 as International Credit Union Day, says the Idaho Credit Union League. In Kaua'i, Hawaii, Mayor Bernard Carvalho Jr. issued a similar proclamation stating that credit unions on the island contribute significantly to the economic well-being of Kaua'i's communities and to an improved standard of living among its members and their families (Kauaiworld.com Oct. 7) . Most of Idaho's 59 credit unions will observe the day by serving cookies and other treats to their members, said the Idaho league. Others will conduct auctions and fundraisers to benefit charities such as the Children's Miracle Network. Still others will host member activities throughout the week. Those scenes will be repeated throughout the nation. Among the special activities:
* Educational CU, Topeka, Kan., will host four opportunities this week for the community to "pay it forward," with the potential for members to win additional money and benefit themselves and the charity of their choice. The credit union will provide $20 to the first 25 people who arrive at specific branches and make a brief video about how they would use the money to pay it forward. They will later e-mail a follow up telling what they did with the money and how it was received. The videos will be uploaded to the credit union's YouTube page at www.educationalcu.org so the public can vote on them. The video participant with the most comments by Nov. 2 will receive $500 and an additional $500 for a charity of their choice (WIBW-TV.com Oct. 7). * Northeast CU, Portsmouth, N.H., indicated is inviting community members to celebrate Thursday at its branches and offering snacks and refreshments. * Redwood CU, Santa Rosa, Calif., said it will celebrate with free educational seminars open to members and the public, a coloring contest for kiddies, a $100 member raffle, giveaways and more. It will conduct workshops on Financial First Aid, Budget-Wise Teens, Money & Me (for ages 6 to 12) on Tuesday and Thursday.
"International Credit Union Week is an opportunity to thank our members for their business and to raise general awareness of the many benefits that credit unions offer our communities, including affordable financial services and free financial education," said Redwood President/CEO Brett Martinez. "Credit unions continue to be safe and sound, and provide a full range of financial products and services while remaining committed to serving and investing in our local communities," Martinez added. A number of credit unions shared their plans with CUNA. Use the resource link to find out what they are planning for this week.

New Washington foundation exec officers elected

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FEDERAL WAY, Wash. (10/12/09)--The Washington Credit Union Foundation (WCUF) board of directors recently elected the foundation’s executive officers. The elections were conducted at a meeting held in conjunction with the Washington Credit Union League’s annual convention in Bellevue, Wash. The board voted to promote Paula Slaye, chief financial officer of Catholic CU, Yakima, to chair. Slaye served on the WCUF board for the past seven years--most recently as vice-chair. Also elected were:
* Vice Chair--M. Earlene Fantz, CEO, American Lake CU, Tacoma; * Treasurer--Steve Wilder, Horizon CU, Spokane; and * Secretary--Gayle Yost, Community Health CU, Everett.
WCUF has given back more than $183,000 in 2009 to the Washington credit union community. The funds supported attendance at the CUNA Management School, smaller credit union grants, community outreach programs and public education efforts--such as the Emmy-winning TV series BizKid$.

North Carolina program prevents 2000 foreclosures

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RALEIGH, N.C. (10/12/09)--State Employees’ CU (SECU) is part of a State Home Foreclosure Prevention Project in North Carolina that has helped more than 2,000 homeowners avoid foreclosure. The project in which the $16.7 billion asset, Raleigh, N.C.-based credit union participates, has been in operation for 10 months (Citizen-Times.com Oct. 8). The project has helped prevent 2,040 foreclosures in North Carolina and also has provided foreclosure prevention and budgeting advice to more than 6,000 homeowners, the newspaper said. Avoiding foreclosures on these homes has prevented $175 million in declines in neighboring property values and financial system losses, according to the North Carolina Office of the Commissioner of Banks, the paper said. North Carolina foreclosure filings are up 10.6% this year due to the economic downturn and job losses, the paper said.

Home and Family Finance refocuses to online

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MADISON, Wis. (10/12/09)--The Credit Union National Association (CUNA) has decided to focus its Home & Family Finance resources on its online product, which delivers new content at least three times a week to subscribing credit unions that serve more than 20 million members nationwide. “CUNA has made a big commitment to providing financial education on the Web,” said Jim Hanson, vice president of CUNA’s business-to-consumer publishing operation, which focuses on financial education. “Home & Family Finance Resource Center is a much more robust product than any print product could deliver and is just one of six online tools that we developed to help credit unions reach specific market segments. With each of these tools, credit union members can access money management information anytime and learn at their own individual pace.” “And the fact is that more and more consumers are getting their information online today,” added Susan Tiffany, Home & Family Finance editor and director of periodicals. There will also be a significant cost savings on distribution, she said. However, the decision means that after 49 years of publishing, Home & Family Finance magazine will no longer be a print product. The final issue came off the press last week. CUNA launched Everybody’s Money, the magazine’s original name, as the 13th issue of The Bridge, now known as Credit Union Magazine, in 1961. Everybody’s Money was a quarterly digest-sized product devoted to money management. Its circulation grew to 2.5 million in 1973. The name was changed to Home & Family Finance in 1998. CUNA’s Web-based Home & Family Finance Resource Center, launched in 1997, will continue to deliver the same kind of money management information online that the magazine delivered in print. The center also provides a virtual library of information, including calculators, videos and articles surpassing the potential reach of a print product. People in online learning conditions perform better than those receiving face-to-face instruction, according to a recent study conducted by SRI International for the Department of Education. The report examined comparative research on online vs. traditional classroom teaching from 1996 to 2008. Most of the studies were conducted in colleges and adult continuing-education programs. Hanson noted that CUNA started building online financial literacy tools in 1997, “well ahead of today’s rediscovery of financial education.” “I’ve had a number of subscribing credit unions tell me they are sad to see the print product going away,” Tiffany said. She has been associated with 111 of the 196 printed issues. “And I tell them that we do have print materials available to them. But most have been excited to learn more about online options. After all, now they can reach all their members 24/7, not just a select few.”

Slovak Republic to re-establish CUs

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BRATISLAVA, Slovak Republic (10/12/09)--The Slovak Republic, with the help of the World Council of Credit Unions (WOCCU), is working to re-establish credit unions in that country. In 1845, cooperative pioneer Samuel Jurkoviè founded one of Eastern Europe's first credit unions in the village of Sobotište in what is now the Slovak Republic. Today, there are no credit unions left in
Click to view larger image Sobotište Mayor Dana Ceranova (left) displays the village guest book with the help of World Council of Credit Unions (WOCCU) Brian Branch (Center) and the National Association of Cooperative Savings & Credit Unions Pawel Grzesik. The Slovak Republic, with the help of WOCCU, is working to re-establish credit unions in the country.
the village, according to Dana Ceranova, Sobotište's mayor. As a result, the village’s inhabitants are paying higher prices for financial services, a situation the global credit union movement would like to change, WOCCU said. Ceranova and a small group of grassroots organizers want credit unions to return to the Slovak Republic, and have enlisted aid from WOCCU and the National Association of Cooperative Savings & Credit Unions (NACSCU)--WOCCU’s member organization in Poland. They will work with the republic’s national government to establish regulatory standards to help credit unions flourish again. “There is no legislative framework for credit unions here,” said Leonard Hölbling, board member of the Slovak Association of Savings Cooperatives (SASC), which is helping spearhead the initiative. “We want to establish the proper legislative framework informed by international best practices.” Credit unions have spread throughout Eastern Europe during the past two decades because of the efforts of WOCCU and NACSCU--which provided extensive credit union development assistance in Belarus, Macedonia, Moldova, Russia and Ukraine. Due to a high level of interest on the part of its people, the Slovak Republic may be the next country to experience the growth of financial cooperatives, explained Brian Branch, WOCCU's executive vice president and chief operating officer. “Two things must exist for credit unions to thrive--interest and support of the people being served, and the proper legislative and regulatory infrastructure,” said Branch, who recently visited the
Click to view larger image World Council of Credit Unions’ Brian Branch (left) greets Slovak Republic Parliament Vice President Miroslav Cíž. (Photos provided by World Council of Credit Unions)
country with Pawe³ Grzesik, plenipotentiary head of NACSCU's Warsaw office. “Slovakians have expressed an interest, and our hope is that we can help them affect the proper legislative and regulatory solutions,” Branch added. In support of SASC, Branch and Grzesik met with officials from the republic’s Central Bank, Ministry of Finance, Ministry of Foreign Relations and Parliament in Bratislava to discuss policy framework for credit unions in a country dominated by urban retail banking. The delegation stressed the benefits of credit unions as lower-cost consumer alternatives outside of urban areas, particularly in villages like Sobotište. As cost-effective alternative providers, credit unions exert competitive pressure on rates and fees while maximizing value to consumers rather than profits for shareholders, Branch told government officials, including Miroslav Èíž, vice president of the republic’s parliament. Slovak Republic policymakers expressed concerns based on experiences with financial speculators and manipulators who used cooperative models to disguise pyramid schemes that negatively affected the country’s economy. Local credit union organizers and delegation members explained how cooperative governance principles and prudential regulations properly exercised can better control risk and ensure the true cooperative management of registered credit unions. “Mr. Èíž responded that the Slovak Republic needs credit unions’ social outreach to serve marginalized populations currently being ignored by banks,” Branch said. “He agreed to support credit union development to accomplish this goal.” Four savings cooperatives exist in the republic. All are registered under a civil code that allows them to accept member deposits to invest in the stock market but does not allow them to make member loans. The Slovak Republic is the latest focus in WOCCU’s ongoing collaboration with NACSCU to develop credit unions. Efforts to help the republic’s growing credit union movement will draw heavily on NACSCU’s past successes within the region, Branch said.

CU System briefs (10/09/2009)

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* DALLAS (10/12/09)--Robert "Rob" Kyker, owner of R&D Sales and Leasing, Richardson, Texas, has been appointed to the Texas Credit Union Commission by Gov. Rick Perry. His term will expire Feb. 15, 2015. The commission supervises the Credit Union Department, which regulates all state charter credit unions. He is a volunteer leader with the Boy Scouts of America and as a national spokesperson for its Emergency Preparedness Committee, and volunteers for several other community organizations (The Advocate Oct. 9) … * WASHINGTON. (10/12/09)--Brian Branch, executive vice president and chief operating officer of the World Council of Credit Unions (WOCCU), will be among the experts featured on a webcast about Individual Development Accounts (IDAs) and other matched savings programs Wednesday at 12:15 p.m. EDT. The webcast is sponsored by New America Foundation of Washington, D.C. and will spotlight WOCCU's new program in Mexico, MatchSavings.org, where online donations are used to match the first savings account of the poor. The event will launch the Global Assets Project to promote savings as a tool for international development and discuss WOCCU's model as it relates to savings promote, financial inclusion and asset building. For more information, use the link … *
Click to view larger image Click for larger view
ALBUQUERQUE, N.M. (10/12/09)--Dave Seely, president/CEO of Kirtland FCU, pictured at far right, was part of a hot air balloon crew last week during the Albuquerque International Balloon Fiesta. The balloon he crewed for was sponsored by CO-OP Financial Services Network and CU Anytime ATM network, according to the Credit Union Association of New Mexico. On average, about 500 hot air balloons ascended each day of the annual balloon festival. (Photo provided by the Credit Union Association of New Mexico) …

Washington state CU leaders honored

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FEDERAL WAY, Wash. (10/12/09)--The Washington Credit Union Foundation honored several credit unions and representatives during its Summit Awards program Sept. 17. The awards are named in honor of a trek that 21 credit union professionals took to Mt. Rainier in Washington 25 years ago. The group was led by Bruce Rouillard, former Washington Credit Union League president. Washington State Employees CU (WSECU) President/CEO Kevin Foster-Keddie received the 2009 Mark of Excellence Award, the highest statewide honor. The award is given to individuals who have displayed 25 years or more of credit union leadership. Foster-Keddie was one of the leaders who helped create a shared branching initiative in Washington. He also developed the first cooperative television advertising campaign. WSECU is located in Olympia. Other awards included:
* The Outstanding Credit Union Volunteer Award, presented to Graeme Sackrison, board member, Generations CU, Olympia; * Distinguished Credit Union Professional of the Year Award, given to Tumwater-based O Bee CU President/CEO Bruce Cramer; * The Legacy Award, presented to Harborstone CU, Tacoma; and * The Desjardins Youth Financial Education Award, given to Spokane (Wash.) Teachers CU.
The foundation also presented four Dora Maxwell Social Responsibility Awards to:
* SnoCope FCU, Everett, $20 million to $50 million in assets; * O Bee CU, $100 million to $200 million; * Horizon CU, Spokane, $200 million to $500 million; and * GESA CU, Richland, more than $500 million.

Illinois REAL Solutions CUs discuss innovations

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NAPERVILLE, Ill. (10/12/09)--Illinois REAL Solutions partner credit unions met to discuss the latest innovations and initiatives of the Filene Institute's i3 group.
Jean Theis, vice president of operations at Motorola Employees CU, Schaumburg, Ill., tells Illinois REAL Solutions partner credit unions about a Debt in Focus web interface initiative to help members get anonymous debt management advice
Frank Weidner, senior vice president of member services at Alliant CU, Chicago, describes the latest projects of the Filene Research Institute's i3 group, a group that explores ideas, innovation and implementation for credit unions, to credit union partners of Illinois REAL Solutions. (Photos provided by the Illinois Credit Union League)
The i3 group identifies and evaluates recent credit union innovations that meet members' needs, lower costs or increase efficiencies, build member loyalty, meet niche needs. and enhance credit union effectiveness. Jean Theis, vice president of operations at Motorola Employees CU, Schaumburg, told credit unions about a Debt in Focus Web interface. Rolled out in June, the initiative provides credit union members with anonymous debt management advice and delivers an actionable plan to help reduce debt and improve members' credit profiles. The tool provides the members with a summary of their debt. According to Filene, 62% of the U.S. population has less than $100,000 in assets. They represent 12% of consumer assets nationwide and are overlooked by today's financial advisers, Theis told the group. They struggle with day-to-day life decisions, including debt counseling, home and auto financing, college savings and retirement savings. Credit unions have an opportunity to build on their strong reputation of trust by giving members a way to analyze their own debt situation and by laying out an action plan to make improvements, she said. Theis also provided updates on other i3 innovations. Representatives from Alliant CU, Chicago, described that credit union's innovations. Joe McGowan, Alliant director of marketing, presented Friends and Benefits, a customized benefit initiative being piloted by the credit union. The program summarizes the value of each member's relationship with the credit union. Its report displays for the member what they have saved or earned above what they would expect at another financial institution. The objective is to demonstrate that the credit union offers the overall greatest value to the member, McGowan said. Also, the benefits statement means the credit union can learn more of the members' business by including offers of loans and other products for which they are eligible. Alliant plans to expand the pilot to a larger, targeted audience and produce an online version as well as a print version. Elements of the report will be included in statements and online banking. Frank Weidner, Alliant CU senior vice president of member services, provide an overview of several of the latest i3 products. These included:
* The Leap, a Web platform aimed at Gen Y regarding sustainable "green" products available at credit unions; * Share the Wealth, a home equity referral program; * The Giving CD, a concept to use the financial power of credit union members to provide funds for development and expansion support of other cooperatives; * Responsible Rent, a loan program for investment property owners in times of foreclosures and depressed home values; and * Credit Union Benefits for Employees, a pooling approach for credit unions to jointly purchase healthcare insurance and benefits.
The Illinois Credit Union League and Illinois Credit Union Foundation have teamed up with the National Credit Union Foundation to offer REAL Solutions for Low Wealth Households. There are 45 credit unions involved in REAL Solutions in Illinois.

FBI Phish Phry reels in 53 scam suspects

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WASHINGTON (10/9/09)--The Federal Bureau of Investigation (FBI) began arresting 53 individuals in the U.S. Wednesday on charges of conducting a vast financial fraud based on phishing or tricking Internet users into revealing their bank account information at two of the nation's largest banks--Bank of America and Wells Fargo. Operation Phish Phry netted arrests in Southern California, Nevada and North Carolina, said the FBI. In addition, 47 co-conspirators in Egypt are being charged by authorities there. This is the largest number of defendants ever charged in a cybercrime case, said the FBI in a press release. The group allegedly stole at least $2 million from 2007 through September 2009 from hundreds and perhaps thousands of the banks' customers. Indictments in a U.S. District Court in Los Angeles accuse three California residents of masterminding the U.S. portion of the scam--Kenneth Joseph Lucas, 25; a friend, Jonathan Preston Clarke; and Nichole Michelle Merzi, Lucas' former girlfriend. They directed associates to recruit "runners" to set up bank accounts to receive funds stolen from the compromised accounts. The online component of the scam initiated in Egypt, where defendants sent mass e-mail messages that appeared to come from the banks, said the FBI. Recipients who clicked on a link in the messages were sent to a fake website identical or similar to the banks' sites, where they were asked to enter information such as their account numbers, passwords, Social Security numbers and drivers' license numbers. The U.S. group would transfer funds into their own accounts and remit money back to accomplices in Egypt. Each of the 53 defendants named in the indictment is charged with conspiracy to commit bank fraud and wire fraud, which carries a maximum penalty of 20 years in prison. Various defendants also are charged with bank fraud; aggravated identity theft; conspiracy to commit computer fraud, specifically unauthorized access to protected computers in connection with fraudulent bank transfers; and domestic and international money laundering. Some analysts said the arrests won't have much impact on the number of online banking scams that have hit businesses, including credit unions. Many other groups are involved in similar fraudulent phish schemes, they said (The New York Times Oct. 8).

Three more nominations received for CUNA Board

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MADISON, Wis. (10/9/09)--The Credit Union National Association (CUNA) has received three more nominations for its 2009-2010 board elections. The new nominees and district categories are: Dennis K. Tanimoto, Hawaii Credit Union League, Honolulu, Hawaii, District 6, Class D; Robert M. Cashman, Metro CU, Chelsea, Mass., District 1, Class C; and Kris J. Mecham, Deseret First CU, Salt Lake City, Utah, District 5, Class B. Already nominated are:
* Laida Garcia, Florida Central CU, Tampa, Fla., District 3, Class B. * Dennis E. Pierce, CommunityAmerica CU, Kansas City, Mo., District 4, Class C; * John A. Graham, Kentucky Employees CU, Frankfort, Ky., District 2, Class A; * Marla S. Marsh, Kansas Credit Union Association, Wichita, Kan., District 5, Class D; and * Susan Steifel, Woodstone CU, Federal Way, Wash., District 6, Class A.
The deadline for nominations is Oct. 16. Nominations are being accepted in eight categories:
* District 1, Class C; * District 2, Class A; * District 3, Class B; * District 4, Class C; * District 5, Classes B and D; and * District 6, Classes A and D.
Eligible candidates must be an employee or voting board member of the nominating credit union. Nominations must be in writing and seconded in writing by two other credit unions of the same size group from the district. Only two seconds will be recorded for each candidate. Upon request, a list of credit unions by size group and district will be furnished to candidates to assist in obtaining seconds. To be an eligible league candidate for a CUNA Director position, individuals must be a league president and be nominated in writing by their league, with a second in writing by at least one other league from the district. CUNA’s Corporate Governance Committee will verify eligibility of each candidate, the credit union's affiliation, size group and district, and date/time of receipt. Voting will begin Oct. 23 and close Dec. 18. For more information, use the link.

ICU Day broadcast to celebrate global CU heritage

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MADISON, Wis. (10/9/09)--The continuing contributions of the worldwide credit union movement will be the topic of the annual International Credit Union Day (ICU Day) broadcast sponsored by the Credit Union Development Educators (CUDE) and the World Council of Credit Unions (WOCCU).
Pete Crear, World Council of Credit Unions president/CEO, will discuss credit unions’ global impact in the face of the ongoing economic crisis as part of an annual International Credit Union Day broadcast Thursday. (Photo provided by World Council of Credit Unions).
This year’s broadcast will originate from United Nations FCU, located in Long Island City, N.Y. Pete Crear, WOCCU president/CEO, will headline an hour-long Thursday discussion moderated by Paul Berry, a former Washington, D.C., television news anchor who hosts Home & Family Finance, a weekly radio program sponsored by the Credit Union National Association. Crear will discuss credit unions’ global impact in the ongoing economic crisis. While credit unions everywhere are affected by fallout from the economic crisis, credit union presence continues to expand globally, said Crear. Rather than contribute to ongoing economic problems, credit unions have diversified risk and provided consumers with safe alternatives when facing their own financial issues. WOCCU is increasing its efforts to reach consumers in urban and rural environments and in countries with significant economic and social challenges, including Afghanistan, Kenya and Sri Lanka, he added. “Worldwide, more than 54,000 credit unions in 97 countries serve more than 186 million members,” said Crear, citing data from WOCCU's 2008 Statistical Report released in June. “Our mission is to support financial independence and economic democracy through credit unions for people around the globe, and we're making great strides in achieving that goal.” The webcast will allow time at the end of Crear's interview for questions. International webcast listeners also will be able to e-mail questions to be answered on the air. The webcast begins at 2 p.m. EDT Thursday and runs until about 3 p.m. It is open to the public and may be accessed by registering at www.wescorp.org or www.woccu.org. The program will be recorded and available for viewing on WOCCU’s website.

Indiana CUs top banks in branching

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INDIANAPOLIS (10/9/09)--The cooperative nature of Indiana's credit unions has created a milestone--they now offer the largest branch network in the state. By partnering with Credit Union Centers of Indiana (CUCI), the networked credit unions provide members access to 201 shared Indiana locations. That's more branches than any other financial institution doing business in the state, including large regional players JP Morgan Chase, PNC/National City and Fifth Third, said CUCI. "This really speaks to the power of credit unions, and the cooperation among Indiana credit union leaders," said CUCI President Karol Griffin of Teachers CU, South Bend. "By sharing resources, credit unions can keep costs down and offer a great convenience to their members while staying extremely competitive." The network enables even the smallest credit union to compete with the largest banks in the region on convenience and access, said Dan Davis, Credit Union Centers executive vice president and chief financial officer. CUCI also is expanding in Illinois. Paul Simons of Rantoul, Ill.-based Credit Union 1 noted the credit union has partnered with CUCI "to begin building the largest branch network in Illinois. Credit unions continue to be a great choice for consumers, and by banding together and building a large shared-branch network, it will make joining a local credit union the smart choice." Credit Union 1 operates 13 of the 64 shared-branch locations operating in Illinois. CUCI is part of Credit Union Service Centers, a national shared-branching network that offers access to more than 3,800 shared branch locations nationwide.

City CU offer small biz start-up incentives

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DRYDEN, N.Y. (10/9/09)--The town of Dryden, N.Y., has teamed up with Alternatives FCU, based in Ithaca, to help local entrepreneurs start up their businesses or invest in them with a savings match program. The town and credit union will provide residents with Individual Development Accounts (IDA)--matched savings accounts that help moderate-income people save for asset purchases. For every dollar a person saves, the town will contribute $2 (Ithaca Journal Oct. 7). A maximum of $1,000 can be matched, which means a resident can get $3,000 for a start-up or expansion of their business. The business must be located in the town of Dryden and owned by Dryden residents. The funds are from payments of a loan the town provided several years ago to Cayuga Press. It received $400,000 in federal HOMES grant money. As Cayuga Press pays back the loan, the town is reinvesting part of the payments in other local businesses, starting with $30,000 for the IDA venture, the town board told the newspaper. Participants in the IDA match program are required to complete finance and business classes offered by Alternatives FCU, which developed an IDA program for both business and personal investments. More than 300 people have saved and made asset purchases through the program the past 10 years, said Alternatives CEO Tristram Coffin. That included 70 home purchases, he told the newspaper.

MembersFirst CU helps schools prevent flu

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COLUMBUS, Ohio (10/9/09)--MembersFirst CU in Grandview, Ohio, has partnered with a local school district to provide a year’s supply of alcohol-free foam sanitizer for students and faculty to use to help prevent the spread of flu and H1N1 viruses. The credit union donated the sanitizer and 25 dispensers. The sanitizer is a better alternative to alcohol-based sanitizer because it is certified “log kill 5,” which means it will kill bacteria and keep hands sterile for up to 30 minutes after each use, compared with 10 seconds for regular sanitizers, the credit union said. The dispensers and sanitizers have been placed in all three Grandview Heights City district schools. The sanitizers will help emphasize the health and well-being of students, faculty and staff without financial burden, according to MembersFirst. “Expanding our partnership with the Grandview Heights City School District by funding the placement of hand sanitizer units throughout the district’s school buildings allows us to fill a vital need at a time when preventing influenza outbreaks is a top public health concern,” said Greg Kidwell, MembersFirst treasurer and CEO.

CU System briefs (10/08/2009)

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* ST. LOUIS (10/9/09)--Vantage CU, with assets of $628 million, and the $50 million asset Spirit of St. Louis CU will merge, announced Vantage CU President/CEO Hubert Hoosman Jr. The merger will be final Dec. 1. "This merger is a mutually beneficial endeavor for both credit unions," said Hoosman. "It's a positive move for Vantage CU in that we'll be able to expand our reach out to Eureka and better serve our West County members." Spirit of St. Louis members will benefit from new locations, additional services and conveniences such as mortgages, investment services, and free money-management and educational services, he said. Vantage, which has more than 111,500 members, is based in St. Louis. Spirit of St. Louis, with 8,000 members served by two locations, is located in Eureka, Mo. It was founded in 1933 by a group of Kroger Food Stores employees in St. Louis. Vantage will now serve members from 16 branches in the greater St. Louis region and 19 counties in eastern Missouri as well as Madison and St. Clair Counties in Illinois … * KANSAS CITY, Mo. (10/9/09)--More than 60 attendees of the Kansas City Chapter of Credit Unions Legislative Breakfast Tuesday met face-to-face with state representatives and discussed credit union and state issues, including the shortfall in state revenue (The Missouri difference Oct. 7). Glenna Osborn, Missouri Central CU, Lee's Summit, noted that one legislator said credit unions need to continually educate representatives about credit union issues and issues impacting their members. Among the lawmakers present were state Reps. Gary Dusenberg (R-54), Jeff Grisamore (R-47), Paul LeVota (D-52), Jerry Nolte (R-33), Bryan Pratt (R-55) and Ray Salva (D-51). Pictured here are, from left: Laura Eblen of Central Missouri Community CU; Dusenberg; Judy Jett of Central Missouri Community CU; and Billy Wilson and Bob Durbin of Mazuma CU. (Photo provided by the Missouri Credit Union Association) … * TEMPE, Ariz. (10/9/09)--A backpack left in a trash can inside Tempe (Ariz.) Schools CU by a man who robbed the credit union had a fake bomb inside it, according to police. The man, armed with a handgun, walked into the credit union at about 10:40 a.m. Wednesday and demanded money from the teller. As he left, he deposited the backpack in the trash can before fleeing on foot. The credit union was evacuated and the Mesa bomb squad responded. The squad discovered the back pack contained a large battery that was smaller than a car battery. No one was injured (The Arizona Republic Oct. 8) … * FARGO, N.D. (10/9/09)--Denver Lee Tergesen, 25, who pleaded guilty to robbing the First Community CU of Jamestown, N.D. in December, was sentenced to 40 months in prison by a federal court judge and ordered to get mental health treatment. Defense attorneys argued that Tergesen suffers from chronic post traumatic stress disorder as a result of 14 months' military service in Iraq and has a gambling addiction. He robbed the credit union of about $10,000. He was arrested in a stolen car near Detroit Lakes, Minn. (Associated Press Newswires Oct. 7) … * CAPITOLA, Calif. (10/9/09)--BAY FCU was named Business of the Year by the Aptos (Calif.) Chamber of Commerce Sept. 25. Chamber
Click to view larger image Click for larger view
Executive Director Karen Hibble noted Bay Federal's "strong support to many local organizations and schools through donations and volunteerism" and said it is "remarkable that 100% of employees have participated in community support activities for each of the last six years." "We are very proud of our dedicated and community minded employees--they are the reason that Bay Federal continues to make a real difference in Santa Cruz County," said Carrie Birkhofer, president/CEO of Bay Federal. Shown from left are: Maureen McCarty, a representative of California Sen. Abel Maldonado's office; California Assemblyman Bill Monning; Santa Cruz County Supervisor Ellen Pirie; and Birkhofer. Behind the podium is Renee Kilmer, vice president of Cabrillo College and Aptos Chamber president. (Photo provided by Bay FCU) …

CU sues McNairs estate for SUV

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NASHVILLE, Tenn. (10/9/09)--A credit union has sued the estate of former Tennessee Titans Quarterback Steve McNair for outstanding payments on a sport utility vehicle he bought the woman who killed him two months later. Old Hickory CU, based in Old Hickory, Tenn., is seeking $43,000 for outstanding payments, attorney fees, and towing and storage for a Cadillac Escalade that McNair bought jointly with, his girlfriend, Sahel Kazemi, on May 7 (NewsChannel5.com Oct. 8). In early July, the couple was stopped in the SUV in downtown Nashville. Kazemi was jailed and charged with driving under the influence. McNair bailed her out. Two days later, Kazemi shot McNair to death, then committed suicide. McNair left no will.

Ohio deputy CU superintendent to take CUs helm

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COLUMBUS, Ohio (10/9/09)--Rose Bartolomucci, who has served as deputy superintendent of credit unions for the Ohio Division of Financial Institutions since 2007, will assume the CEO position at TeleCommunity CU in Akron, Ohio. She will take on the role as CEO later this month, replacing CEO Jack Sarver, who is retiring, according to the Ohio Credit Union League. “Rose served as an excellent regulatory leader for Ohio’s credit unions and provided the best in regulatory leadership, including open communications, commitment to safety and soundness, modern credit union supervision practices, and strong credit union representation,” said Paul Mercer, league president. Prior to joining the division, Bartolomucci was CEO of Vantage Financial CU, now Best Reward CU, Brook Park, and Kent CU (Ohio).

Missouri chapters donate 56000 to kids hospitals

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SPRINGFIELD and KANSAS CITY, Mo. (10/9/09)--Missouri credit unions in Springfield and Kansas City recently donated more than $56,000 to the Children’s Miracle Network for children’s hospitals.
Click to view larger image Members of the Springfield Chapter of Credit Unions present a donation--raised at an annual golf tournament--to the Children’s Miracle Network. (Photo provided by the Missouri Credit Union Association)
The Springfield Chapter of Credit Unions and the Kansas City Chapter of Credit Unions both sponsored golf tournaments in September to raise funds for the network (The Missouri difference Oct. 7). Springfield credit unions raised a record-breaking $30,700 at the 13th Annual Benefit Golf Tournament Sept. 11. The event included more than 120 golfers and major sponsors. The Greater Kansas City Credit Unions for Kids held its 14th Annual Tee Off for Tots Golf Classic in Independence Sept. 10, raising $26,000 for the network. Both credit union chapters used a Miracle Match from CO-OP Financial Services to increase their donation totals.

President of Poland visits Polish and Slavic FCU

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BROOKLYN, N.Y. (10/9/09)--Polish President Lech Kaczynski visited the Polish & Slavic FCU (PSFCU), Brooklyn, N.Y, while he was in New York last week for the opening of the United Nations General Assembly. His visit marked the first time an acting head of state had met with executives and employees of the 33-year-old credit union. Kaczynski shared stories about his credit union roots and the role U.S. credit unions played in Poland’s march toward democracy 20 years ago (earthtimes.org Oct. 8). “This is undoubtedly the greatest tribute we have even been awarded,” said Bogdan Chmielewski, CEO of PSFCU. “I cannot express the level of pride that all our employees and our 70,000 members are experiencing as a result of this visit. This visit is a testament to our success as the largest financial institution serving Polish people outside of Poland, and the work we do toward improving the lives of so many Polish-Americans.” In his speech to PSFCU guests and employees, Kaczynski remarked how proud he remains having been the first chairman of the Polish Credit Union Foundation in Poland, and the role that U.S. credit unions played in the emerging Polish government a generation ago. “The Polish & Slavic FCU is an institution that has been well-known to me for years,” Kaczynski said. “As a matter of fact, 20 years ago, a group of my 20-year-old associates left for the U.S., and brought back the idea and the knowledge of credit unions. They decided to establish such a movement in Poland, and truth be told, it is the largest Polish social/financial success since 1989.” Chmielewski told his guests that the Brooklyn-based credit union’s members retain strong ties to Poland, and that the credit union itself continues to work closely with the Polish Cooperative Savings and Loan (SKOK) organization. Much of the initial success of the SKOK can be attributed to the assistance yielded by its American counterparts, Kaczynski said. At the conclusion of Kaczynski’s visit, representatives from the PSFCU board of directors presented him with a commemorative statuette--a silver and gold replica of the PSFCU membership book, which grants him an honorary membership. “You are a movement that's very dear to me,” Kaczynski said.

For Gen Y are you a lame CU Or a standing ovation

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BRAUNFELS, Texas (10/8/09)--One credit union service organization (CUSO) has hit on a way to drive the financial literacy message of credit unions home to Generation Y--through high school concerts from live musicians that incorporate the use of social networking to spread the news about the events and financial literacy. Eloquent Online is a "shadow CUSO" organized in 2006 by Chetco FCU, a $358.6 million asset credit union based in Harbor, Ore. It was intended to research and help the credit union understand the world of social networking as a marketing medium in the banking marketplace. The CUSO discovered right away that social networking was the new communications medium for Gen Y and the Millennials--the under 30 set-- and the credit union was determined to share what it found. It is helping credit unions to spread the word of financial literacy through music in terms of Concerts for Financial Literacy, YouTube videos, Twitter, MySpace and Facebook, and other communications channels popular with the iPod set. According to Jason Dias, president of Eloquent Online and vice president of marketing at Chetco, this is what reaches the younger set. "They don't have a lot of attention span, and you're not reaching them with a spoken presentation or a Power Point presentation. They're too busy listening to their iPods and texting. So we went with where the target goes--to the music." Several credit unions are following the research. Americhoice FCU in Mechanicsburg, Pa., used a live concert sponsored by its high school branch that attracted 900 Gen Yers. Kids are the ambassadors at the events. The events are on YouTube, and they tweet and use Facebook to spread the word. "A 15 or 16-year old wearing an I-pod won't see a television commercial or read a newspaper or hear a radio ad," Dias told News Now. The Association of Vermont Credit Unions just got a grant to improve financial literacy among Vermont's high school student population using Concerts for Financial Literacy from Eloquent Online (News Now Oct. 5). The CUSO uses no print media. It reaches the young set solely with social media and music. At the concerts, which are often sponsored by the school's student-run credit union, "the kids become the ambassadors for financial literacy. "Gen Y is an ownership generation. They like to own things. You can approach them with the message, 'Hey, you can own your credit union,'" Dias said. The demographic is also thrifty. "You can reach them with the message that they spent on average $1,100 on songs they downloaded in 2008--think of the money they could have saved. That's how you reach them." Think of marketing to this demographic in terms of a large graph, Dias said. "At one end is the word 'lame' and the other end 'standing ovation.' Then you have to pick where your credit union is on that graph. Are you lame? Or are you a standing ovation? Most credit unions are on the lame side. They have a dichotomy of generations, and many have older, outdated boards," Dias said. He noted that Chetco's first Concert for Financial Literacy took place in May 2008 at a high school. "Over 500 young people heard a financial literacy message delivered not from a binder, but from a thumping, rocking concert. In the course of 80 minutes, the crowd grew as students texted and called their parents to come see what was happening at their school. This was not youth marketing. It was youth immersion. The teachers and parents overwhelmed the credit union with calls of thanks and sent letters to the editor of local newspapers," Dias said. For more information, use the resource links.

Vantage CU uses Twitter for account transfers

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BRIDGETON, Mo. (10/7/09)--Vantage CU, Bridgeton, Mo., launched a new banking solution, tweetMyMoney, which allows members to conduct financial transactions within their credit union accounts through social networking site Twitter. Released Sept. 28, tweetMyMoney is free to Vantage members. It allows them to monitor their account balances, deposits, withdrawals, holds and cleared checks. Members also can transfer funds within their accounts. The program can be accessed from a computer or mobile phone. About 70 members have enrolled. They access the program by enrolling in Vantage’s online banking program and setting up a Twitter account. Members also must sign up to “follow” Vantage on Twitter. tweetMyMoney works through Twitter’s Direct Message function--which allows users to send messages to each other privately. In this case, members send messages to Vantage. The program “utilizes a set of codes that you send via direct message to the credit union and get information back,” Eric Acree, executive vice president of operations, told News Now. The codes, originated by Vantage, appear at the end of each e-mail or text return to let members know the messages are legitimate. Members can change the codes at any time to make them more recognizable. They also can change them if there’s a concern the account has been compromised. The codes were implemented to combat phishing. “It’s one of many things we did to address security concerns,” Acree said. “If they get a message that doesn’t have the right code, they know it’s fake.” And, if a code accidentally goes public, “nobody knows what it means,” Acree said. As a security measure, Vantage cross-references individuals following the credit union on Twitter with those who have signed up with the program. One account number is allowed per Twitter username. The new program was controversial from the start, with some members of the technology community responding to tweetMyMoney negatively within hours of its launch. “They thought we were insane because of the unsecured nature of Twitter,” Acree said. “They were tearing us apart on the Internet. They jumped to conclusions, went to our website, and then voted their thoughts.” Vantage has an online poll so users can rate tweetMyMoney. After its launch, the program’s rating was low. However, when Vantage tracked the votes, it realized that negative votes were from non-members who were not using the program. “The primary hurdle is getting people to understand what little risk exists because of the type of information we’re providing and the type of transactions,” Acree said. He recognized that Twitter has been hacked, but said the credit union has thought through every worst-case scenario. The information provided in the Direct Messaging function presents a minimal to nonexistent risk, he said. The credit union hasn’t marketed the program, except for information on its website about enrollment. The viral component of Twitter has been very powerful. “It far exceeded our expectations,” Acree said, referring to the number of members that have signed up for the service so far through word of mouth. Feedback from members on tweetMyMoney has been positive. One member commented on Vantage’s site that the solution “sure beats the pants off of giving up your information to a company like [account aggregator] Mint--[members] of this credit union can now keep it closer to home.” Though the credit union has no hard data yet because the program was so recently launched, Acree expects that tweetMyMoney users are younger. He plans to analyze user data more deeply in about a month. Vantage developed tweetMyMoney in about four months. The staff also discussed text messaging and iPhone applications--which the credit union will provide next year--but kept coming back to Twitter. Vantage contacted several industry technology firms to discuss ideas, and then wrote the program. Testing took about two months, Acree said. Many financial institutions worldwide have contacted Vantage about the program and asked how it keeps the environment secure--which Vantage doesn’t detail for security reasons. Credit unions seeking to provide similar services should work with third parties--such as industry experts or technology firms--to get involved. “The big reason why we could do it more easily is because we wrote our own online banking program,” he said. For many credit unions, writing a banking program could be challenging. “Many credit unions may be at the mercy of the online banking companies they use,” Acree said. tweetMyMoney isn’t a mass-market item--it’s a niche product. Vantage knows that all of its members won’t sign up for it. But if Vantage can make 500 or 1,000 members happy, then it has “strengthened the bond with those members,” Acree said. Vantage plans to offer more solutions in the future, through text messaging, Facebook, and the iPhone. Convenience is a driver for these programs, but security is a primary concern. “We put a lot of thought into security [for tweetMyMoney],” Acree said. “If we can prove that we did our due diligence, it will be well-received. And if we think there’s a real security risk, we’ll terminate it immediately.”

Consumers pull back on credit cards debit rising

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WASHINGTON and YONKERS, N.Y. (10/8/09)--The recession has been hard on the credit card industry, but debit cards are another story, with debt-strapped consumers turning more and more to the debit card for purchases, according to The Washington Post Oct. 7). In July, revolving credit--primarily credit cards--dropped by $6.1 billion, or 8.1% on an annualized basis, according to the Federal Reserve. However, debit card use, which has steadily grown over the years, has surged during the recession. For the first six months of 2009, MasterCard saw U.S. debit card-purchase volume increase 4.1%--to $160 billion--while spending via credit cards dropped 14.8% to $233 billion. Visa reported similar trends. Last spring, it announced that Visa debit card spending in the U.S. surpassed credit spending for the first time in the company's history. Debit payment volume last year was $206 billion, while credit volume totaled $203 billion. Analysts told the newspaper that the drive toward debit card use comes from:
* Cost-conscious consumers shifting their behavior to fit their current economic situation so they can save more and limit their discretionary spending. In July, the personal savings rate rose to 4.2% of after-tax income, from 1% early last year; * Consumers who don't want to carry cash or write checks that present more opportunities for theft than online spending; and * A backlash from consumers angered by recent credit card industry practices, including raising rates and fees, cutting credit lines, and forcing borrowers to go elsewhere.
TowerGroup, a Needham, Mass.-based financial services industry research firm, has predicted debit card use will increase through 2015. It found that in less than 15 years, debit card transactions in the U.S. grew to more than 50% of non-cash transactions, up from 1%.

CU CEOs confidence rises in back-to-back surveys

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PLANO, Texas (10/8/09)--Credit union CEOs’ confidence rose in the last two quarters, according to two back-to-back surveys conducted by Southwest Corporate. The corporate’s Credit Union CEO Confidence Survey indicated that the Confidence Index for the third quarter increased to 29.09, up 4.5 points from the previous quarter to 29.09. The index represents a 21-point improvement over the survey’s all-time low of 7.9, which was recorded during the first quarter of 2009 (eFacts Oct. 6). Credit union CEOs have an overall positive outlook for their own institutions, the corporate said. Assessments of credit unions’ financial condition now and six months from now climbed by nine points and two points, respectively. Confidence in their members’ financial condition now and in six months rose by four and five points, respectively. “Recent news that the economy appears to be stabilizing a bit may be a source of encouragement to credit union CEOs, especially those still shell-shocked by narrowing interest margins, rising insurance assessments and stabilization expenses,” said Brian Turner, Southwest Corporate director of advisory services. “Having most of that behind us not only provides a sense of relief, but also helps us to focus on the future again.” The quarterly survey, mailed to 1,328 credit union CEOs, had a response rate of 24.10%.

Tech Council paper discusses server virtualization

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MADISON, Wis. (10/8/09)--Virtualization, the ability to partition a physical computer server into multiple functioning machines, has gained recognition and acceptance in recent years and is now considered viable in terms of start-up costs for many credit unions, according to a new white paper, “Server Virtualization,” from the CUNA Technology Council. About 70% of credit unions with assets greater than $200 million were surveyed for CUNA’s 2008-2009 Technology and Spending Report. It indicates plans toward putting virtual server technology in place within the next three years--a signal that the credit union movement is traveling at a rapid pace toward the next generation of system processing and storage. According to the paper, server virtualization has many advantages for credit unions and their data centers, including:
* Massive reductions in the number of servers needed overall--a process known among information technology (IT) professionals as “rack consolidation”; * Reductions in space and energy needed to run and cool the IT infrastructure, which generates a smaller carbon footprint and lower energy costs; * Vast reductions in the time needed to bring new servers and applications online; * The ability to easily switch virtual machines with functions or applications heavily in demand over the one virtual machine host to another to avoid overloading, slowdowns, or a system crash; and * Significant decrease in time needed to switch servers for disaster recovery. For example: Heritage CU, Madison, Wis., with $153 million in assets, downsized to two virtual server host machines from 16 physical box servers. Conversely, Mid-Atlantic Corporate FCU, Middletown, Pa., with $3.5 billion in assets, dropped to eight virtual server host machines from 100 physical box servers.
The paper also explores different models of server virtualization, including the virtual machine model, which currently dominates the market. Four in-depth case studies of credit unions also are presented with expert advice on topics such as storage area networks and desktop virtualization. For more information, use the links.

IConsumer ReportsI notes value of CU credit cards

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YONKERS, N.Y. (10/8/09)--Consumers angry about some of the tactics of credit card issuers lately should take control of their cards and fight back with strategies such as switching to a card from a credit union, says Consumer Reports in its just-released November issue. "If you regularly carry a balance, you can beat the card issuers at their game by keeping your debt as low as possible and perhaps switching to a card from a credit union or a regional or community bank, which tend to charge lower interest rates and have more pro-consumer policies," said the report. Consumer Reports repeats that advice for two of the three kinds of credit card users. Fifty-four percent pay off their balance in full each month, 33% carry balances up to $10,000 (with a median balance of $2,554) and 13% carry balances over $10,000 (with a median of $17,366). For the low-balance cardholder, the first strategy listed is: "Roll over balances to cards issued by credit unions or regional or community banks. Credit cards from federal credit unions are capped at 18% APR (annual percentage rate), so even if you do fall behind on payments, you'll avoid the 30% default rates some major cards charge." It also notes that credit unions have the option to take funds from any deposit account to cover credit card defaults. For the card users with more than $10,000 on their balances, among the advice is--again--"roll over balances to small bank or credit union cards. " In a sidebar, the article looks at credit union cards from Pentagon FCU, Addison Avenue FCU, the Digital FCU. The survey of 1,211 Americans in July found that:
* Of those surveyed, 21% said they were treated unfairly by card companies; * Roughly 41% were highly satisfied with their card issuer, making credit cards "one of the lowest-rated services we cover," said Consumer Reports; * Four-to-one respondents said they were charging less on their cards than they did last year; and * Roughly 32% said they had paid off and closed a card since January 2008.

PaCUSC board holds prices steady

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HARRISBURG, Pa. (10/8/09)--The Pennsylvania Credit Union Service Centers Inc. (PaCUSC) board of directors reviewed its pricing structure and chose to not make any changes, despite tough economic times.
Pennsylvania Credit Union Service Centers Inc. board members who met recently in Harrisburg, Pa., are, front row, from left: Norb Kaczmarek, secretary/treasurer; Ralph Canterbury, chairman; and Jim Kanaley, vice chairman. Back row, from left: Directors Karl Larson, Brian Hahn, Tom Smith and Linda Brown. (Photo provided by the Pennsylvania Credit Union Association)
The board met Tuesday in Harrisburg to follow up on its Strategic Planning Session held in June (Life is a Highway Oct. 7). Also, the PaCUSC Board approved entering into a relationship with CO-OP Shared Branching to promote CO-OP Financial Service’s Mobile Banking product. The CO-OP Mobile Banking program allows credit unions using the Next Generation Network to offer mobile banking to their members at a reasonable cost. The board discussed new shared-branching technology, Fast Branch Kiosks, which provide ATM technology and offer access so members can complete shared branching transactions. Erie (Pa.) FCU is one of two credit unions that have deployed Fast Branch Kiosk machines in Pennsylvania. Three machines deployed in the Erie area act as the credit union’s ATMs, providing branch access in locations previously inaccessible. “Although PaCUSC had a slow start in the early 1990s, PaCUSC has been growing with more than 100 shared-branching locations in Pennsylvania,” PaCUSC Chairman Ralph Canterbury told the board. “By the end of 2009, PaCUSC is on target to have a record 111 locations in Pennsylvania and six locations in Delaware.”

Coverage prompts Minn. Senate hearing on FIs

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ST. PAUL, Minn. (10/8/09)--The Minnesota Senate Commerce and Consumer Protection Committee held a hearing Tuesday to examine the lending practices and oversight of financial institutions in Minnesota, including credit unions. The hearing has been in the works for more than two months, following a series of articles published in the Minneapolis/St. Paul Star Tribune in late July. The article, entitled “Lenders Gone Wild,” placed blame on banks, credit unions and the Department of Commerce for taking too much risk and playing a role in the recent economic collapse. The hearing was called by State Sen. Linda Scheid (DFL-Brooklyn Park), who chairs the committee, which has jurisdiction over all bills relating to banking in the state of Minnesota. Scheid said she was eager to learn more about the regulation and examination of financial institutions. “Minnesota has a large number of community banks and national banks with a large presence here, and we certainly have strong credit unions as well,” she said. “It’s important that consumers know that their money is safe in our state’s financial institutions.”
Click to view larger image Minnesota Commerce Commissioner Glen Wilson (left) and Deputy Commissioner Kevin Murphy testified at a Minnesota Senate hearing Tuesday in St. Paul to examine the lending practices and oversight of financial institutions, including credit unions, in Minnesota. (Photos provided by the Minnesota Credit Union Network)
The safety and soundness of credit unions and banks was reiterated throughout the afternoon. The hearing’s list of testifiers--10 in total--represented credit unions, banks and regulators. The Minnesota Department of Commerce began the meeting with Commissioner Glen Wilson and Deputy Commissioner Kevin Murphy providing an overview of banks and credit unions, key objectives of regulation and examinations, reports and rating systems, watch lists, and statistical data about market share and bank failure rates over the past 30 years. Subsequent testifiers also discussed deposit insurance, lending in the current economy, and the overall health and strength of credit unions. “It was noted several times that credit unions are safe and sound financial institutions, and I think that message was heard loud and clear,” said Mark D. Cummins, president/CEO of the Minnesota Credit Union Network. “The line up of testifiers was quite impressive,” Cummins added. “The various organizations provided facts and information from their own perspectives, but all the testimony carried the same underlying theme--that additional regulation would likely be burdensome and unnecessary.” Cummins spoke at the hearing, along with National Credit Union Administration (NCUA) Region IV Director Keith Morton, US FCU President/CEO Bill Raker, and representatives from the Federal Deposit Insurance Corp. (FDIC), the Minnesota Bankers’ Association, the Minnesota Independent Community Bankers and two bank presidents. Morton educated the committee about credit unions’ structure, discussed their strict underwriting standards, and provided factual context to credit unions’ role in the financial downturn. “As a general rule, credit unions are conservatively run,” Morton said. “While there are credit unions that pursue aggressive strategies, as a whole, Minnesota credit unions have not been significantly affected by the loans and investment products that have been the subject of market and media attention during this economic crisis.” Several testifiers cited the healthy working relationship between not only state and federal regulators, but between the regulators and the financial institutions they oversee. “The state plays an important role, along with the NCUA, to ensure that both state- and federally chartered credit unions are properly examined and well-regulated,” Raker said. “While the public’s trust and confidence in many financial institutions have suffered some erosion, credit unions are still held in high regard by their member-owners.” Deputy Commissioner Murphy agreed. “In this economic climate, there are not a lot of sure things in this world,” he said. “But a deposit at a bank or a credit union is a sure thing. Consumers can take comfort in that.” He pointed to financial illiteracy as a significant cause of today’s economic woes and encouraged legislators and financial institutions to devote greater resources to financial education efforts. Ultimately, Scheid said that she does not foresee Minnesota imposing additional regulation on financial institutions. “I’m pleased that Sen. Scheid used this forum to learn more about the regulation of credit unions and banks, using our organizations as the industry experts, as opposed to media reports and second-hand information,” Cummins said. “Through this hearing the credit union industry had an opportunity to speak directly with legislators and set the record straight about generalizations that have been imposed upon the general public.”

Rockford CUs join Treasurers Bank on program

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NAPERVILLE, Ill. (10/8/09)--Three Rockford area credit unions joined Illinois State Treasurer Alexi Giannoulias at an Oct. 1 press conference to officially kick off the “Bank on Illinois” program in Rockford, Ill.
Illinois State Treasurer Alexi Giannoulias looks on as Karen Jurasek, CEO of Generations CU, Rockford, Ill., speaks at a press conference for “Bank on Rockford”--a program that aims to offer unbanked residents from underserved and minority communities free or low-cost accounts with mainstream financial institutions, including credit unions. (Photo provided by the Illinois Credit Union League)
“Bank on Rockford” is a program that aims to offer unbanked residents from underserved and minority communities near Rockford free and/or low-cost accounts with mainstream financial institutions. Credit unions are part of this effort. Partner organizations, which include local not-for-profit agencies and financial institutions including credit unions, hope to sign up 1,000 individuals in the Rockford area in the next year. The three area participating credit unions in the program were represented at the press conference: First Northern CU, Chicago; Generations CU, Rockford; and MembersAlliance CU, Rockford. To participate, financial institutions must offer free or low-cost checking and savings accounts, “second chance” accounts for people with negative credit histories, and accept tax identification numbers, Matricula Consular and other foreign IDs in place of Social Security numbers. To qualify for an account, residents must have a history free of identity theft and fraud. They will be encouraged to enroll in financial literacy training courses. So far, two states--California and Illinois--are offering the program. Rockford is the first Illinois city to participate. Aurora will be the second city with an informational meeting to be held today. Rockford is home to roughly 4,600 unbanked households, according to the Pew Charitable Trusts/Safe Banking Project. The households rely on check cashers, payday lenders and pawn shops--instead of a bank or credit union--to cash checks, pay bills and borrow or wire money. The average unbanked household in Illinois pays $574 a year just to cash payroll checks, leaving $22,376 in remaining income. “Too many Rockford residents are ripped off by check cashers and payday lenders and become trapped in an endless spiral of debt,” Giannoulias said. “Having access to traditional checking and savings accounts will translate into financial independence and empowerment.” “Many of the non-profit partners provide essential elements such as housing and job training, but their clients lack the skills necessary to manage their housing expense and their paycheck,” Karen Jurasek, CEO of Generations, said at the press conference. “This is the point of referral to our credit unions and banks--that can provide the services and educational tools needed for financial security.” “By participating in Bank on Rockford, community groups and non-profit organizations will refer people to our credit union who truly need our help,” said Ed Berg, Illinois Credit Union League director and CEO of First Northern CU. “Without partner referrals, we may never be able to reach many of these people.” Nationally, 65% of unbanked residents are employed full-time and another 24% work part-time, Pew reports. However, more than half of unbanked households say they’ve never had a checking account because of misperception about and distrust of banks.

Hannaford judge seeks Maine Supreme Court input

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PORTLAND, Maine (10/8/09)--A federal judge who ruled against compensating consumers in a potential class-action lawsuit against Hannaford Bros. has reconsidered and is seeking input on the data breach case from the Maine Supreme Judicial Court. In a decision filed Monday, U.S. District Judge D. Brock Hornby agreed to seek input from the state's highest court on a question that has no precedent in Maine (MaineBusiness.com and Portland Press Herald Oct. 6) . The question is: Do Hannaford shoppers who had to be reimbursed by their banks and went through other hassles associated with stolen account numbers have the right to seek damages for their effort and lost time? Plaintiffs filed a motion this summer asking Hornby to reconsider his original May 12 ruling in which he said consumers cannot seek compensation for the breaches. In that ruling, he dismissed all civil claims against the Scarborough, Maine-based Hannaford. "Those are the ordinary frustrations and inconveniences that everyone confronts in daily life with or without fraud or negligence," Hornby wrote in his May ruling. "Maine law requires that there be a way to attach a monetary value to a claimed loss. These fail that requirement." The plaintiffs in the original case filed a motion last summer asking the judge to reconsider. If the court confirms the original May decision against the consumers, the case will likely end, said the Portland Press Herald. However, if the court finds that consumers have the right to sue for lost time and effort, the case will be revived and plaintiffs will seek class-action status. The grocer experienced one of the largest data breaches in history in late 2007 and early 2008, resulting in millions of compromised card numbers. By the time it made the breach public in mid-March, 2008, cyberthieves had used the stolen data for 1,800 frauduent charges. Hannaford's attorneys argued that the system of contracts between merchants, banks and credit unions, and consumers, as well as a federal law requiring financial institutions to reverse fraudulent charges, work to protect consumers. An extra layer of liability would serve no public good, they said.

New York Desjardins Award winners announced

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ALBANY, N.Y. (10/8/09)--The New York Credit Union Foundation awarded Desjardins Youth Financial Education Awards to three New York credit unions. The Desjardins Award recognizes credit unions that demonstrate a significant commitment to youth financial education. Recipients include:
* Clarence Community & Schools FCU, under $35 million in assets; * Buffalo Metropolitan FCU, $35 million to $75 million in assets; and * Teachers FCU, Farmingville, more than $250 million in assets.
Accepting the awards were: Sandra May, assistant manager, Buffalo Metropolitan FCU; Marsha Brauer, manager, Clarence Community & Schools FCU; Frederick Schaefer, board chair, Teachers FCU, and board member Mario Shortino, Teachers FCU. “Now more than ever, it’s essential that our children and youth understand the importance of improving their financial literacy so they are better equipped to work toward a sound financial future,” said Diane LaVigna-Wixted, foundation executive director.
The New York Credit Union Foundation presented Desjardins Youth Financial Education Awards to credit unions for their commitment to youth education. Accepting the awards for their credit unions were (left) Sandra May, assistant manager, Buffalo Metropolitan FCU, and Marsha Brauer, manager, Clarence Community and Schools FCU.
 
Board member Mario Shortino (left) and board chairman Frederick Schaefer accepted the Desjardins Youth Financial Education Award on behalf of their credit union, Teachers FCU. (Photos provided by the New York Credit Union Foundation

Study Consumers small biz look to FIs for help

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CALABASAS, Calif. (10/7/09)--Consumers and small business owners are seeing a light at the end of the economic tunnel and that light could be their credit union's online finance management tools. A year after the banking crisis began, 52% of consumers surveyed said their financial prospects will improve during the next 12 months. And 61% of small business owners said they were also optimistic about their business's growth. They will be turning to credit unions and other financial institutions to help them make the most of their opportunities. Nearly 70% of respondents expressed confidence in the stability of their credit union or bank. Consumers and businesses surveyed also said they wanted more online tools from their financial institutions. The survey findings were presented by Digital Insight, the financial institutions division of Intuit Inc., last week. Digital Insight is a provider of online financial management tools to credit unions and banks. Its research was conducted by Decipher research in July and August by polling 1,000 adults and 5j00 small business owners across the U.S. Other findings:
* Roughly 80% of consumers pay bills and transfer funds online but 62% would like a single place to manage their complete financial picture, no matter where the information originates. * Nearly half would like online help with tracking expenses and budgeting. * About 80% of consumers and small businesses named their credit union or bank as their most trusted online destination to manage their finances--up from 68% last year. * Seventeen percent of small business owners have increased their use of online financial management tools in the past year. * The top five tasks that small business owners would like to manage online are: processing credit card and automated clearinghouse payments; invoicing; making remote deposits; planning and filing taxes; and learning about new products and services.
"Consumers and small business owners clearly are looking for help as they manage through the strained economy," said Sasan Goodarzi, president of Digital Insight. "Financial institutions have an unprecedented opportunity to seize this moment and provide the tools and services that their customers and members want and need. By offering the right tools at the right time, they can build lifelong relationships that will help grow their business." Credit unions are lending to small businesses owners who are struggling to find loans in a tight credit market. The Credit Union National Association says that increasing the lending limit for these loans to 25% from the current 12.25% would go a long way in helping small businesses. Increasing the limit would free up an extra $10 billion in capital for small businesses and commercial loans.

Shared branching kept CU open during G-20 Summit

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HARRISBURG, Pa. (10/7/09)--Pittsburgh-based Allegent Community FCU temporarily closed its branch and relocated its entire staff to a remote location while the G-20 Summit of world leaders met in downtown Pittsburgh for three days in September. According to the Pennsylvania Credit Union Association, the credit union on Sept. 23 set up a temporary working environment, equipped with a call center, in North Hills. There, staff took phone calls, handled loan applications and performed most of their job functions (Life is a Highway Oct. 6). The only thing Allegent didn't have was a physical branch for members to transact business. However, the credit union said the Shared Branching Network allowed Allegent members to make transactions at other credit unions in the area so they could avoid downtown Pittsburgh during the summit. Call center staff for Allegent said most of the members used shared branching for the first time those three days and were pleased they could still make their financial transactions.

Missouri CUs crank it up for HFOT soldiers

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BRANSON, Mo. (10/7/09)--Country music stars The Bellamy Brothers and Lee Greenwood ended the Missouri Credit Union Association's annual convention with a concert to raise awareness and funds for Missouri's first recipient of a specially adapted home built by Homes for Our Troops (HFOT).
Click to view larger image SSG Robert Canine, his brother Jamie, Homes for Our Troops (HFOT) Founder/President John Gonsalves, Rep. David Day (R-148) and credit union representatives meet with singer Lee Greenwood (center, back row) before a concert to raise awareness and funds for HOFT homes for disabled veterans.
Click to view larger image The Bellamy Brothers met HFOT President/Founder John Gonsalves and Army SSG Robert Canine backstage during a fundraising concert at the end of the Missouri Credit Union Association's convention and exposition in Branson, Mo. Canine will receive a specially built home from HFOT. (Photos provided by the Missouri Credit Union Association)
The concert was the first opportunity for Army Staff Sergeant Robert Canine, recipient of the Missouri HFOT house, to meet with Missouri credit union representatives and HFOT President/Founder John Gonsalves. Credit unions are sponsoring the project. Canine lost both legs below the knee in May 2009 when his Humvee was attacked in Iraq. A native of Mexico, Mo., Canine is walking again on prosthetics and undergoing physical therapy. He, his wife Jennifer and 8-year-old son Sebastian plan to reside in Columbia, Mo. United CU, Mexico, provided information about HFOT to Canine's family. "This entire experience almost seems too good to be true," said Canine. "When I think about what Missouri credit unions and Homes for Our Troops are doing for me and my family, I just try not to cry. I am so thankful for everything." Mid Missouri CU, Fort Leonard Wood, helped bring 25 local soldiers representing the base's Warrior Rehabilitation Unit to the concert for free. Brent Sadler, Mid Missouri chief operating officer, noted that when the HFOT concert coincided with the credit union convention, "it only made sense to reward some heroes that have actually been overseas protecting our nation by giving them the red-carpet treatment." Both the Bellamy Brothers and Greenwood met with credit union representatives, Canine and his brother Jamie, and the Warrior Rehabiliation Unit soldiers before the concert. Greenwood told the group, "It's a great thing that you are doing. I commend you for all of your hard work in helping these soldiers." Credit unions in Colorado and Minnesota also worked with HFOT and the national presidential conventions to build homes in those states for veterans wounded overseas.

CaliforniaNevada leagues partner with Guatemala

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ONTARIO, Calif. (10/7/09)--Representatives from Guatemala's national credit union trade association met with a California assemblywoman from Guatemala and inked a partnership agreement with the California and Nevada Credit Union Leagues in a weeklong visit earlier this month. The visit by representatives from the Federación Nacional de Cooperativas de Ahorro y Crédito (Federated Cooperative Credit Union System or FENACOAC) ended Oct. 2.
Oswaldo Oliva, left, CEO of FENOACOAC, Guatemala's credit union trade association, and Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues signed a World Council of Credit Unions International Partnerships agreement Sept. 29. (Photo provided by the World Council of Credit Unions)
League President/CEO Bill Cheney and FENACOAC CEO Oswaldo Oliva signed the agreement Sept. 29, establishing a mutually beneficial cooperative relationship between the two movements as part of the World Council of Credit Unions' (WOCCU) International Partnership Program. "We're looking forward to working with credit unions in Guatemala now and in the future," Cheney said. The leagues will work with the Guatemalan federation and WOCCU in the areas of advocacy, shared branching and the implementation of a share insurance fund in the Central American country. The recent meeting set the stage for considerable efforts to come, according to FENACOAC's Oliva. "We learned a lot from our visit, and we're leaving with a list of things we're going to implement immediately," Oliva said. The delegation also met with Assemblywoman Norma Torres (D-Pomona), the first Guatemalan immigrant to serve in California's state assembly, at the leagues' Ontario, Calif., office. Torres is a member of the Assembly Banking and Finance Committee. A long-time credit union member, Torres said credit unions have special relationships with their members in that they know each member by name. She pledged to support the credit union cause in both California and Guatemala, and encouraged the delegation to stress the role credit unions play. "You need to tell people about how credit unions are different from banks," said Torres. In addition to Oliva, the FENACOAC delegation included Guillermo Peralta, board chairman; Carlos Flores, strategic marketing manager; and Mario Salvatierra, business coordinator. They visited to learn about the U.S. credit union system, league operations, risk management, marketing, branding and shared branching. The delegation also met with Altura CU, Riverside; SchoolsFirst FCU, Santa Ana; and Financial Service Centers Cooperative, San Dimas. The new partnership brings WOCCU's International Partnership Program's active partnerships to 25. "Partnerships show that cooperation among credit union organizations is important in strengthening our industry worldwide," said Victor Miguel Corro, WOCCU senior manager for international partnerships, who participated in the visit. "I have no doubt that California/ Nevada's and Guatemala's willingness to share and exchange knowledge will make for better services offered to members."

Nomination received for CUNA board election

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MADISON, Wis. (10/7/09)--The Credit Union National Association (CUNA) has received another nomination for its 2009-2010 board elections. The fifth nominee and district category is Laida Garcia, Florida Central CU, Tampa, Fla., District 3, Class B. Already nominated are:
* Dennis E. Pierce, CommunityAmerica CU, Kansas City, Mo., District 4, Class C; * John A. Graham, Kentucky Employees CU, Frankfort, Ky., District 2, Class A; * Marla S. Marsh, Kansas Credit Union Association, Wichita, Kan., District 5, Class D; and * Susan Steifel, Woodstone CU, Federal Way, Wash., District 6, Class A.
The deadline for nominations is Oct. 16. Nominations are being accepted in eight categories:
* District 1, Class C; * District 2, Class A; * District 3, Class B; * District 4, Class C; * District 5, Classes B and D; and * District 6, Classes A and D.
Eligible candidates must be an employee or voting board member of the nominating credit union. Nominations must be in writing and seconded in writing by two other credit unions of the same size group from the district. Only two seconds will be recorded for each candidate. Upon request, a list of credit unions by size group and district will be furnished to candidates to assist in obtaining seconds. To be an eligible league candidate for a CUNA Director position, individuals must be a league president and be nominated in writing by their league, with a second in writing by at least one other league from the district. CUNA’s Corporate Governance Committee will verify eligibility of each candidate, the credit union's affiliation, size group and district, and date/time of receipt. Voting will begin Oct. 23 and close Dec. 18. For more information, use the link.

GoogleTwitter adviser keynotes retail delivery convention

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SAN DIMAS, Calif. (10/7/09)--The keynote address of Financial Service Centers Cooperative’s 2010 Credit Union Retail Delivery Convention will be given by Chris Sacca, Twitter adviser and former head of special initiatives for Google. Sacca will tell credit unions how to create a culture of new media by discussing his experiences with Google and how the credit union movement can use those principles to serve its members. He also will share how Twitter grew its business by 400% in three months. Other speakers at the conference will provide analyses of the trends surrounding social media and the growth of dialogue, new retail delivery channels, disaster planning and the latest consumer and member trends. The convention is scheduled for June 30 through July 2 in Chicago. This year’s theme is “Delivering the Future...Now.” The convention aims to provide credit unions with opportunities to enhance their strategies on membership growth, innovation and consumer trends.

Ex-manager sentenced to 11 years for 2.2M theft

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HOUSTON (10/7/09)--The former manager of the Houston Longshoreman’s FCU No. 24 was sentenced to more than 11 years in prison for taking $2.2 million in fake loans. Melinda Diane Andrews, 53, managed the credit union and created 110 phony loans for more than $7 million, court documents revealed (Houston Chronicle Oct. 5). Using the bogus loans, she funneled away $2.2 million for herself and family members between 2000 and 2006, the document indicated. Because of the thefts, the credit union closed in February 2006, prosecutors alleged in the original charges against her. Andrews was sentenced to 135 months--11.25 years--in prison after being found guilty of financial institution fraud against the credit union, and for tax evasion and theft for failing to report $236,000 in stolen income in 2004. The National Credit Union Administration discovered the improprieties during an audit (Examiner.com Oct. 5).

IWash. PostKiplingersI Avoid overdraft fees bank at a CU

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WASHINGTON (10/7/09)--Consumers should bank at a credit union to avoid costly overdraft fees, said a personal finance columnist for Kiplinger’s, whose column was reprinted in The Washington Post Sunday. In a column titled “Three Ways to Avoid Overdraft Fees,” Joan Goldwasser tells readers that one way is to “bank at a credit union or small bank.” Goldwasser writes: “‘Credit unions have the lowest fees and require the lowest balances,’ says Ed Mierzwinski of the consumer advocacy group U.S. PIRG. And small community banks make it easier to decline overdraft protection. If your bank doesn't let you opt out, find one that does.” To read the column, use the link.

IWSJI CUs others would pay price on interchange controls

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NEW YORK (10/7/09)--Credit unions, consumers and community banks will foot the bill if Congress decides to put price controls on interchange fees, says The Wall Street Journal. In a Thursday opinion piece, John Berlau, director of the Competitive Enterprise Institute's Center for Investors and Entrepreneurs, points to 7-Eleven Inc. and other retailers as culprits in forcing “big government down the throats of American consumers. “If Congress acts on 7-Eleven’s misleading petition to put price controls on interchange fees, consumers will pay the price through the reduction of credit card reward programs such as frequent flier miles, and the possible return of annual fees,” Berlau wrote. “Credit unions and community banks will pay the price, too, in higher costs that will make it more difficult to offer cards at all. This could force their customers to abandon their local lending institutions if they want the convenience of credit and debit cards. “Contrary to the spin of the 7-Eleven and other big retailers, interchange fees, also called ‘swipe fees,’ are only levied on merchants, and none of the major legislation currently before Congress would require retailers to pass on one penny of their resulting savings to consumers,” Berlau added. “Australia’s recent experience with interchange price controls, for example, resulted in no tangible benefits--but plenty of added costs--for consumers down under.” Mastercard Inc. and Visa have come out against 7-Eleven’s position on interchange fees. MasterCard released a study that claims consumers were misled by a petition intended to drum up support for interchange fee regulations (News Now Oct. 2). Visa also weighed in on the interchange debate, saying that legislators and the public should not be swayed by the showy delivery of 15,000 booklets by 7-Eleven executives of signatures supporting interchange fee reforms (News Now Oct. 5). CUNA has spoken in favor of the current interchange fee structure, saying that regulating interchange fees would adversely affect consumers, competition and technological innovation. CUNA also has highlighted the positives of interchange fees, saying that the fees help credit unions cover their expenses and losses while offering merchants a guaranteed source of payment at the time that the transaction is completed (News Now Aug. 10).

Council paper addresses analyzing training needs

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MADISON, Wis. (10/7/09)--A training-needs analysis can help credit unions in times of budget tightening to determine which types of training is most needed, according to a new CUNA HR/TD Council white paper, “Conducting a Training Needs Analysis for Your Credit Union.” The paper includes three case studies that show how credit unions have used training needs analyses (TNAs) successfully. The training leaders note in the paper that both formal and informal processes can do more than identify topics for training classes at credit unions. A TNA also should:
* Advance progress toward the credit union’s strategic goals; * Refine training tactics; * Improve communication; * Offer opportunities for personal development; and * Enhance workplace performance.
The paper also discusses formal and informal approaches as it explores credit unions’ options for learning more about employees’ training needs. For more information about the paper or the Human Resources/Training Development Council, use the link.

Tinker FCU hits 2 billion in assets

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OKLAHOMA CITY (10/7/09)--Tinker FCU (TFCU) announced Tuesday it has reached the $2 billion asset mark, despite the economy. "I remember when we reached the $1 billion mark in 2001. It took us 55 years," said TFCU President/CEO Michael D. Kloiber. "Now in just eight years, we're at $2 billion." He noted a "good, sound asset base allows us to do more for (our members in the way of services, technology and benefits." He attributed the growth to consistent sound business practices and the loyalty of the Oklahoma City-based credit union's more than 200,000 members. "Like other credit unions, we avoided the subprime mortgage arena. And, we held steady with a solid asset and liability plan that emphasized consistently competitive rates without trying to lead the market on every product every day," Kloiber explained. The credit union's member growth and loan growth were the results of the credit union's strong member service and branch network, a financial education program developed last year, www.buckthenorm.com--a TFCU-hosted website geared to teens and young adults, various outreach programs targeting Gen Y and a strong branding campaign, he said. TFCU tracks member and public perception of its service and brand recognition. It has a Net Promoter Score of 85%, which means 85% of its members would recommend the credit union to their family and friends. Bankography listed TFCU in the nation's Top 10 for brand recognition, the credit union said.

CU System briefs (10/06/2009)

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* ALBANY, N.Y. (10/7/09)--Credit union representatives from the Utica-Rome chapter of the Credit Union Association of New York
Click to view larger image Click for larger view
recently gathered for an event to benefit the association’s state political action committee. Rep. David R. Townsend (R-Central N.Y./Utica-Rome) attended the event and spoke with his credit union constituents. Events like these “serve a dual purpose,” said Cheryl Frantzen, association political action coordinator. “They help ensure that credit unions maintain a voice in the political arena while raising awareness among fellow credit unionists of legislative issues facing our credit unions today.” Pictured are Jeff Gardner (waving), board member of Utica District Telephone EFCU; Townsend (at center in back), and several credit union representatives. (Photo provided by the Credit Union Association of New York) ... * WESTBROOK, Maine (10/7/09)--The Maine Credit Unions’ Campaign for Ending Hunger, in partnership with Good Shepherd Food Bank,
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celebrated the fourth anniversary of Maine’s first and only “food mobile” Monday with a contribution of $7,500. The amount is symbolic of the 7,500 pounds of food that the food mobile can carry each trip. The food mobile has distributed 1,129,540 pounds of food to food pantries throughout Maine since the mobile’s inception in 2005. Food pantries in every Maine county receive its deliveries each year. Jon Paradise, governmental and public affairs manager for the Maine Credit Union League, and Diane Dunton, chair of the board of Good Shepherd Food Bank, stand in front of the state’s only food mobile holding the check from the campaign. (Photo provided by the Maine Credit Union League) …

Group Health CU embraces environmentalism

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SEATTLE (10/6/09)--Group Health CU, Seattle, encouraged members to be more environmentally savvy with a promotion that will literally bear fruit for the community. The credit union launched a Neighborhood Harvest promotion last month that involved placing a fruit tree at each Group Health branch. The credit union branches cared for the trees until the trees were taken to their permanent home--the Dakota Orchard and P-Patch in Rainier Valley. The fruit from the trees will be shared with the community, and the overflow will be donated to local shelters and food banks. The credit union used the fruit trees and Neighborhood Harvest promotion to encourage members to sign up for the credit union’s paperless services--including e-statements and online bill pay. Members also could opt to receive the e-mail version of Gear Up, the credit union’s newsletter. The credit union got the idea for the promotion with connections it received through social networking site Twitter. Shannon Perry, Group Health CU assistant marketing manager, posted a tweet on Twitter asking for some ideas to help the promotion. Perry connected with an executive from the Arbor Day Foundation in Nebraska, which eventually led to Perry talking with a Seattle arborist (Seattle Times Oct. 4). The experts led Perry to a local tree nursery--Raintree Nursery--where she was given several recommendations for fruit trees that would do well in the Seattle area. The credit union then used the trees as a part of the Neighborhood Harvest promotion. Group Health embraces environmentalism as a corporate strategy, the Times said. In addition to the Harvest promotion, the credit union offers discounts on loan interest rates for hybrid vehicles, the newspaper added. Group Health CU has $285 million in assets.

Iowa league files application to buy Ariz. bank

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DES MOINES, Iowa (10/6/09)--The Iowa Credit Union League has filed an application to purchase Tucson, Ariz.-based CreditCard National Bank in response to member credit union needs and an understanding that Iowa Corporate Central CU is looking at its future. Iowa Corporate Central CU, Des Moines, is a small but well-capitalized corporate, according to Patrick Jury, Iowa league president/CEO. However, the Iowa corporate has conveyed to its members that it is examining its future to determine if it can continue to provide the same competitive products and services, considering its relatively small size in a changing regulatory environment. “Based on that understanding, our membership directed the Iowa league to look for a resolution that would maintain local autonomy and direction of Iowa credit union correspondent services,” Jury said. In addition to local ownership and autonomy, Jury said other priorities include:
* Ensuring credit unions’ transition to a new institution is seamless; * Assuring that the alternative serves all credit unions regardless of asset size; and * Ensuring that the alternative provides similar products, services and pricing, and retains current Iowa Corporate Central CU employees.
The proposed bank charter would provide credit unions with settlement services, access to payment systems, and relationships with Visa and MasterCard for Iowa credit unions, Jury said. A secondary benefit of the charter would be to facilitate the league’s credit card processing expansion through The Members Group, a league affiliate. "This application is in response to the needs communicated by Iowa credit unions based on the uncertain future of Iowa Corporate," Jury said. "We have complete confidence in the National Credit Union Administration.” The league has conducted several town hall meetings for Iowa credit unions about the application to buy CreditCard National Bank. The credit unions have expressed “strong support,” Jury said. The application, filed with the Federal Reserve Bank of Chicago, has a 60-day window before a decision is made. The bank could ask the league for more information, which extends the decision-making process. If the application is declined, the league will look at other alternatives to serve its members, Jury said. He emphasized that should the league purchase CreditCard National Bank, it would not have a retail operation and no board member or staff member would receive stock or a financial benefit as a result.

Scams hit four CUs

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MADISON, Wis. (10/6/09)--Several recent scams have targeted four credit unions in various regions of the U.S. The following scams have been reported:
* Suffolk FCU, Medford, N.Y., and Island FCU, Hauppauge, N.Y., debit card holders were targets of scam text or voice messages, which tell members their debit card numbers have been deactivated, police said. The victims were instructed to call a phone number to provide account and personal identification numbers to reactivate their accounts. Police reminded the public that credit unions do not contact members by mail, phone or Internet to request account information (Newsday Oct. 3). * Shoreline CU, Two Rivers, Wis., reports that a website--www.SurveyLot.com--is mailing fraudulent cashier’s checks to Internet visitors nationwide, according to Sharon Tome, Shoreline chief operating officer. The checks are written for $3,975.20 and contain the routing number for the credit union and an account number--now closed--of a Shoreline member. The credit union has returned roughly $30,000 worth of checks that tried to clear through the account, Tome said. No Shoreline members have been victimized by the scam, she added. Shoreline officials are alerting other financial institutions that the checks are fraudulent (Herald Times Reporter Oct. 1). * Paducah (Ky.) FCU, has received dozens of calls from members who received a suspicious text message that said in part: “This is an automated message from Paducah FCU. Your ATM card has been suspended. To reactivate, call URGENT at 1-866-571-7629.” When the number was dialed, the caller heard an automated message requesting the caller’s bank account number. The telephone number has been disconnected, and the credit union is not aware of any members who were victimized by the scam (INFED Oct. 1).

Online surveys help CU improve cash management

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BREA, Calif. (10/6/09)--A credit union that positions itself as a banking resource to ministries faced new challenges helping customers navigate the changing financial landscape when the economy went into crisis mode last year. One way Evangelical Christian CU (ECCU) met the challenges was by partnering with the ministries they seek to serve. ECCU created a ministry advisory panel to solicit--through brief online surveys--the insights and expertise of ministry staff, leaders, and financial decision-makers regarding financial management and other relevant issues. Panel participation was not limited to ECCU member ministries. The credit union’s goal is to explore new ideas and uncover best practices that can help ministries better manage their financial resources. Besides keeping the surveys brief, ECCU attracts new panelists by assuring that their feedback is anonymous, offering them eligibility to receive incentives for participating, and assuring panelists they will be the first to be notified when survey results become available. The $1.264 billion asset, Brea, Calif.-based ECCU is a banking resource for Christian churches, schools, and other evangelical ministries nationwide.

Federation reacts to CDFI Fund awards

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MILWAUKEE (10/6/09)--The National Federation of Community Development Credit Unions said it is pleased to have received an award from the Treasury Department’s Community Development Financial Institutions (CDFI) Fund. The federation received $750,000 from the fund. The awards were announced Friday in Milwaukee. The funds support CDFIs’ lending activities in underserved areas. They also help organizations, including credit unions, to provide affordable financial products and services to low-income communities and populations. “We have seen significant positive changes in the fund’s awards over the past year, thanks to the efforts of the CDFI Fund’s committed staff, but we remain concerned about the under representation of credit unions among awardees,” said federation President/CEO Cliff Rosenthal. “Credit unions are central to the CDFI industry because in addition to affordable financing, they provide low- and moderate-income communities with a full range transaction and insured deposit services, asset building programs, financial literacy education, and other lifeline products that are so desperately needed in the current economy,” Rosenthal added. Of the 62 CDFIs receiving awards, two awards totaling $850,000 went to two community development credit unions (CDCUs), less than 2% of the total financial assistance awards this round, the federation said. The two CDCUs were Neighborhood Trust FCU, New York City, which received $350,000, and Union Settlement FCU, New York City, which received $500,000. One million dollars also was given to Self-Help Venture Fund, Durham, N.C., an affiliate of Self-Help CU in Durham. With the federation's award, the combined four awards account for less than 4% of the $52.7 million that was distributed, the federation said. National Credit Union Administration (NCUA) Chairman Debbie Matz applauded credit union participation in the CDFI’s supplemental funding round, and encouraged broader credit union involvement in the currently open 2010 CDFI financial assistance program. Credit unions receiving funds under the Recovery Act and 2009 Round as noted by NCUA include:
* Alternatives FCU, Ithaca, N.Y., $2 million; * ASI FCU, Harahan, La., $2 million; * Brooklyn Cooperative FCU, Brooklyn N.Y., $1.1 million; * Communicating Arts CU, Detroit, $2 million; * First Legacy Community CU, Charlotte, N.C., $2 million; * Latino Community CU, Durham, N.C., $2 million; * Mendo Lake CU, Ukiah, Calif., $2 million; * Opportunities CU, Burlington, Vt., $2 million; and * Santa Cruz (Calif.) Community CU, $2 million.
The CDFI Fund also awarded $4.4 million to 10 CDFIs through its Native American CDFI Assistance (NACA) program, which is designed to encourage the creation and strengthening of certified CDFIs that primarily serve Native American, Alaskan Native and Native Hawaiian communities, the federation said. Of the 10 NACA awards, two went to credit unions--$470,000 to Federation-member Molokai Community FCU (Kaunakakai, Hawaii) and $225,000 to First Hawaiian Homes FCU (Hoolehua, Hawaii). While the percent of total NACA awards to community development credit unions (CDCUs) was 6.45%, CDCUs represent nearly 20% percent of the CDFI industry. The federation is committed to closing this gap. “We will continue to advocate vigorously for CDCUs to receive grants commensurate with their leading role in community development finance,” Rosenthal said. “We look forward to working closely with the fund to determine the barriers to increased credit union funding, especially at a time when financial services are so desperately needed in low-income communities, and when CDCUs have been hard hit by credit union system problems not of their making.”

CU hopes to turn around Alaska community

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ANCHORAGE (10/6/09)--An Anchorage-based credit union is hoping to help turn around an Alaska community that is known for its high crime and low income. Credit Union 1 plans to open a branch in spring in Mountain View, a community located near Anchorage. Although the branch’s opening is months away, the staff is already helping Mountain View residents by providing financial literacy and organizing community events and projects in the area (KTUU.com Sept. 30). The credit union also began offering a new elective class at a local middle school that teaches personal finance to seventh and eighth graders. Rachel Ramsey of Credit Union 1 told KTTU that it takes “baby steps” to get individuals into the habit of saving and opening checking accounts. Credit Union 1’s plans to open a Mountain View branch is viewed as a “personal finance renaissance,” that will hopefully end Mountain View’s poor economic stigma, the news outlet said. Mountain View has failed to keep many national businesses in the area, and its last financial institution--Alaska State Bank--closed in 1989, KTTU added. Credit Union 1 has $661 million in assets.

CU System brief (10/05/2009)

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* TOLEDO, Ohio (10/6/09)--Efforts to raise $100,000 in start-up capital for a proposed state-chartered credit union in Toledo, Ohio, are underway (eLumination Sept. 30). Credit unions have committed nearly $1.3 million in non-member deposits for the proposed Nueva Esperanza (New Hope) Community CU (NECCU), but regulators require that 10% of that amount be raised for capital before the credit union opens. Toledo-area businesses, business leaders and individuals are being asked to contribute. The Ohio Credit Union League, Ohio Credit Union Foundation, NECCU incorporators and Toledo-area credit union leaders met with business leaders to discuss the benefits that NECCU would provide the community. NECCU will serve residents of South Toledo--primarily Latino residents. The credit union hopes to increase financial literacy, and provide a safe, reasonable alternative to higher cost financial services that many residents use ....

More than 200000 youth save with SECU programs

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RALEIGH, N.C. (10/6/09)--State Employees’ CU’s (SECU) youth accounts are continuing to grow, as more young North Carolinians embrace the concept of saving. The credit union’s two programs--Fat Cat, for children up to age 12, and Zard, for teens aged 13 through 19, recently surpassed the 200,000 mark in accounts opened with deposits totaling more than $80 million.
Fat Cat and Kristy Spaulding, vice president of SECU’s Lumberton-West Fifth Street branch, meet with students at a local elementary school as part of the Fat Cat program for children up to age 12 that places an emphasis on youth financial education. (Photo provided by State Employees’ CU)
Fat Cat and Zard place emphasize youth financial education, with dedicated websites, newsletters and in-school presentations by SECU personnel. Launched in 2000, SECU’s Fat Cat account was developed to foster a relationship with members at a young age and to assist parents in teaching their children the value of saving and managing money wisely. When Fat Cat members establish their accounts, they receive incentive items, and a passbook to track their savings. In addition to the Fat Cat website, www.cufatcats.org, and Fat Cat Paw Prints newsletter, SECU utilizes a Fat Cat Smart Money booklet as a teaching tool in many North Carolina elementary schools. With more than 35 Fat Cat costumes statewide, SECU personnel take the mascot into the schools to help them teach basic money concepts. SECU’s Zard teen program, which started in April 2002, expands account and service options for members to include a checking account, ATM/debit card and other lending and savings products. Zard members also receive an incentive item, and financial information on topics such as budgeting, checkbook balancing and credit scores via its Money Matterz newsletter and www.teenzard.org website. To enhance the program, SECU personnel use the National Endowment for Financial Education High School Financial Planning program and BizKid$ curriculum in North Carolina schools. “We are so happy to see the growing number of youth accounts at our credit union, as SECU personnel have worked diligently over the years to reach out to younger members,” said Leigh Brady, SECU senior vice president of education services. “Our youth programs also allow us to expand our financial education efforts--giving back to North Carolina through presentations to youth on money management topics. As SECU’s Fat Cat and Zard members grow older, we look forward to their financial success.”

Federation awarded 750000 CDFI Fund grant

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MILWAUKEE (10/5/09)--The U.S. Treasury’s Community Development Financial Institutions (CDFI) Fund Friday announced awards totaling $52 million to 62 organizations that serve economically distressed communities nationwide, including the National Federation of Community Development Credit Unions and two credit unions. The federation received a $750,000 award from the program. Neighborhood Trust FCU received $350,000 and Union Settlement FCU received $500,000. Both credit unions are located in New York City. Financial assistance provided through the program helps CDFIs increase lending activities in underserved areas, according to CDFI Fund Director Donna J. Gambrell, who announced the awards in Milwaukee. It also helps organizations, including credit unions, to provide affordable financial products and services to low-income communities and populations. “As we celebrate this national award announcement, we are also celebrating the work of these community-based lenders that enables the dreams of entrepreneurs to become realities,” she said. The CDFI Program is funded through an annual appropriation from Congress. The fund receives applications annually and awards funds through a competitive process. The fund has awarded more than $821 million since its inception. The CDFI Fund received 452 applications from organizations nationwide, requesting more than $529 million in funding under the fiscal year 2009 round of the CDFI Program. The awards complete the 2009 funding round by awarding the remaining funds to the most highly rated applicants in a pool that included:
* Applicants that submitted applications responding to the Notice of Funds Availability (NOFA) published in the Federal Register April 28; and * Applicants that applied under the initial 2009 NOFA published Aug. 15, 2009, but did not receive a Recovery Act award in the first funding announcement.

CUs in media spotlight as ICU Day approaches

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MADISON, Wis. (10/5/09)--As credit unions count down the days to Oct. 15--which is International Credit Union Day--some in Ohio and North Carolina are picking up the media spotlight for their efforts. Ohio's credit unions will be featured this week, sharing their knowledge and resources to help members build sound financial futures, says the Ohio Credit Union League (eLumination Newsletter Sept. 30). "The week preceding International Credit Union Week, the entire episode of the Ohio News Network's (ONN) Ohio & Company program will be dedicated to consumer finance issues, education and tips, courtesy of Ohio's credit unions and paid for by the Ohio Credit Union League," the league said. ONN is carried by nearly every cable outlet in the state. The 30-minute news magazine program will feature three segments:
* Budgeting for everyday living and the upcoming holidays; * Teaching kids money skills using MoneyAndStuff.info's free materials and resources; and * How credit impacts your life and making smart decisions.
All the information will be available on "The Difference, YOU" website, OhioDifference.com, and viewers will be encouraged throughout the program to visit FindACreditUnion.com to locate a credit union to join. The program will air Tuesday at 6:30 p.m., Wednesday at 10 a.m., Thursday at 11:30 a.m., and Friday at 11 a.m. and 7:30 p.m., reaching several different viewing audiences. Also, in North Carolina, Charlotte Metro FCU Chief Marketing Director Nathan Tothrow was featured on WJZY's "Morning Buzz" show, educating listeners about what credit unions are, how they are different, and how one can join. He also introduced the credit union's promotional spot, "You Can Do Better," that is airing online and in call center channels. The ad has increased membership applications 200%, he told show host Angela Golden. To view the show and the commercial, use the link.

137000 fin lit grant OKd for Vermont CUs

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MONTPELIER, Vt. (10/5/09)--A $137,000 federal grant to improve financial literacy among Vermont’s high school student population has been approved for use by the Association of Vermont Credit Unions (AVCU). With the grant’s approval, the association has announced the launch of a state-wide, high school-based financial literacy program (Newslines Express Oct. 2). “The Concerts for Financial Literacy … presented by Vermont’s Credit Unions” will weave together financial literacy education, music and social media interaction into a cohesive package targeted directly at the lifestyle and values of Vermont’s 14- to 18-year-old population, the association said. The educational components will be delivered through school presentations, social media sites like Facebook, Twitter, and YouTube, and through videos hosted on a new AVCU website dedicated to the program. Students at dozens of Vermont high schools can participate in online contests and special events to win the opportunity of hosting a Concert for Financial Literacy at their high school. The concerts will feature professional musicians who have their own financial literacy messages to share, and student-musician groups selected from “Battle of the Bands” contests organized through the social media websites. The concerts will take place in May, and the process will repeat in the fall of next year and the spring of 2011.

Sen. Hagan headlines high school branch opening

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GREENSBORO, N.C. (10/5/09)--U.S. Sen. Kay Hagan (D-N.C.) cut the ribbon to celebrate the opening of Allegacy FCU’s fourth student-run credit union, Bobcat Student CU, at a local high school Sept. 21. While celebrating the student branch’s opening, Hagan also discussed the details of the Financial Literacy for Students Act of 2009, her first piece of legislation as a U.S. senator (Weekly Update Oct. 1). “We’ve got to empower people to make smart financial decisions,” Hagan said. She commended Winston-Salem-based Allegacy and R.B. Glenn High School, where Bobcat Student CU is located.
U.S. Sen. Kay Hagan (D-N.C.), center, cut the ribbon to celebrate the opening of Bobcat Student CU at a Winston-Salem, N.C., high school. The student-run credit union is a branch of Allegacy FCU, also located in Winston-Salem. (Photos provided by the North Carolina Credit Union League).
Saving just a dollar or two a week adds up, North Carolina Credit Union League President John Radebaugh told students at the opening of Allegacy FCU’s student-run branch at R.B. Glenn High School in Winston-Salem.
One-third of adults in a recent Harvard University study didn’t understand compound interest or how their credit card accounts work, Hagan said. The lack of basic financial knowledge at home underscores the need for financial education in the classroom, she added. “Our students need to enter the work force with the skills to make smart financial decisions when applying for credit cards, securing student loans, taking out a mortgage or managing a budget,” Hagan said. Bobcat Student CU will be staffed by 10 student volunteers and a teacher liaison and will be open during lunch three days a week. The volunteers will accept deposits and help student manage their accounts. They also will receive course credit for their work. North Carolina Credit Union League President John Radebaugh, who attended the opening, encouraged students to join the credit union and save money. “Even if it’s only a dollar or two a week, it does add up,” he said.

Microsavings focus of rural microfinance meeting

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MEXICO CITY (10/5/09)--More than 500 people from Mexico and six other countries came together last week in Mexico City to learn how credit unions in Mexico are sustainably serving the rural poor, and how other credit unions can do the same. World Council of Credit Unions (WOCCU) and the Proyecto de Asistencia Técnica al Microfinanciamiento Rural (PATMIR) project of the Mexican Ministry of Agriculture, Livestock, Rural Development, Fishing and Food (SAGARPA), co-hosted the two-day event on Rural Microfinance: Strategies for Reaching the Rural Poor. SAGARPA funds WOCCU's development program in Mexico. The typical profile of a person living in poverty is that of an individual who understands and is accustomed to a credit culture, said Luis Jara, project director for WOCCU's Mexico program, during a presentation on Wednesday. Donor-funded development programs, as a result, have focused on providing microcredit to alleviate poverty in rural communities. Recent research on microcredit programs, however, has questioned the effectiveness of this approach. Through the PATMIR project, WOCCU's focus in Mexico is to bring financial services to the poor and help them build assets through savings.
Click to view larger image The general manager and board members of Caja Zongolica CU, located in the mountains of Veracruz state, attend a session on “Creating Opportunities for Rural Areas” by Margarito Saavedra, general manager of Caja Yanga CU at a two-day conference on Rural Microfinance: Strategies for Reaching the Rural Poor, held last week in Mexico City.
Click to view larger image Meeting after a press conference at a rural microfinance conference Tuesday are, from left, Luis Jara, World Council of Credit Unions; Jeffrey Max Jones, sub-secretary of agri-business strengthening, Mexican Ministry of Agriculture, Livestock, Rural Development, Fishing and Food (SAGARPA); Gabriela Zapata, SAGARPA/ Proyecto de Asistencia Técnica al Microfinanciamiento Rural; and Brian Branch, WOCCU executive vice president and chief operating officer (Photos provided by World Council of Credit Unions)
“We always knew that people in rural areas save ... that the poor save in real goods such as animals, bricks, even tires,” said Brian Branch, WOCCU executive vice president and chief operating officer. “Today, we know more about cash flows in rural households, that they depend on diverse sources of income--some agricultural, some not. With PATMIR's leadership, we have learned how to bring financial services to the member without constructing a branch office in every village. Currently, we are learning how to use technology to lower the costs of service delivery.” WOCCU's development program in Mexico helps credit unions expand services to underserved areas through its rural outreach methodology, semilla cooperativa [cooperative seed], which emphasizes savings mobilization. Credit unions train rural field officers to attract new members, extend financial education, approve small loan applications and bring credit, savings and remittance services directly to people living in remote areas up to 19 miles from branch offices. New technologies and tools implemented through the program’s credit unions debunk the myth that the poor are too expensive and risky to serve, WOCCU said. Personal digital assistants, handheld printers, point-of-service devices and plans for installing ATMs in rural areas help reduce the risks and costs of reaching marginalized communities by making transactions more efficient. Credit unions also use a WOCCU-developed route-costing tool to identify viable areas for expansion. The Mexico program is surveying 20,000 people living in rural areas to determine their true financial needs. Preliminary results reveal that 54% of members joined the credit union to access both savings and credit products, compared with 26%, who only wished to access credit. Of the non-members surveyed, 46% were interested in both savings and loans, whereas 20% desired credit. The survey results will help the program create an accurate member profile and assist credit unions with tailoring their products and services. “Savings and credit aren’t new, but we're making headway in determining the best delivery method, mechanisms and packaging to best meet the needs of the poor,” said Gabriela Zapata, director of financial organization strengthening with SAGARPA's PATMIR project. The semilla cooperativa model outshines typical group lending programs because it is savings-based and serves both men and women, she added. Many credit unions have said they do not reach out to the poor because it is too dangerous, expensive and difficult, and that it is not their market, Jara said. He explained that if you inspire confidence and trust in members, the credit union will grow. Nineteen people from five countries also attended the second year of WOCCU's Manager Certification Program, a hands-on regional training program to give credit union managers tools to analyze and forecast the financial condition of their institutions.

KV FCU moving forward--as a CU

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AUGUSTA, Maine (10/5/09)--Kennebec Valley FCU (KV FCU), whose members voted down a proposal to convert to a bank and merge with Kennebec Savings Bank, is looking toward business as usual as a credit union, says KV FCU's president, who said she will continue her plans to step down in March. Beverly Beaucage, president of the $53 million asset, Augusta, Maine-based KV FCU, expressed "disappointment" at the vote's outcome to a local newspaper Morning Sentinel (Oct. 2). However, the credit union's managers and directors will move on as a credit union without seeking another merger partner, she said. KV FCU will introduce some new member services that were put on hold during the merger process. "This is a business, and when you hear from your base that it wants to go in a different direction, that's what you do," she told the newspaper. She noted that the membership has been "quiet" for years and hadn't attended annual meetings. "In a sense, it's good to hear from the members." she said. KV FCU Board Chairman Richard Tardiff issued a statement that the board members respect the credit union members' will and the democratic process. The merger proposal spawned two member advocacy groups. KV Members Matter opposed the proposal and was supported by the Maine Credit Union League, according to league President John Murphy. KV Members Voting Yes for the Merger, which favored the merger, was supported by Kennebec Savings Bank. Both groups debated the merger proposal publicly in a series of letters to the editor of local newspapers. The vote concluded Sept. 21 and was tallied by a New York City firm, said the article. Credit union officials did not ask for the exact vote tally or the number of members voting, Beaucage said, adding the credit union just wanted direction from its members. Credit union officials had been planning the conversion for more than a year and had approached the bank about a possible merger. A merger between a bank and a credit union would have been the first of its type in Maine. Plans were for Beaucage to serve in a management position at the bank if the merger succeeded. However, she planned to retire within months after the merger date. She said the merger has not prompted her retirement. She will leave in March after 21 years.

Missouri honors CU achievements with awards

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JEFFERSON, Mo. (10/5/09)--The Missouri Credit Union Association (MCUA) recognized individuals for their credit union achievements during its convention and expo Sept. 23.
Click to view larger image Longtime credit union volunteer Earl Ogolin, second from left, was honored by the Missouri Credit Union Association for his 60 years of service to the movement. With him are from left, sons Steve and Michael Ogolin and his wife Moni. (Photo provided by the Missouri Credit Union Association)
MCUA showcased outreach efforts of 24 Missouri credit unions during an awards reception Sept. 22. The association honored winners of the Dora Maxwell Social Responsibility Award, Louise Herring Award for Philosophy in Action, and the Desjardin Youth Financial Education Award at the state level. First place winners of the Dora Maxwell Social Responsibility Award in their asset categories include:
* Poplar Bluff (Mo.) FCU, $20 million to $50 million in assets; * Central Missouri Community CU, Warrensburg, $50 million to $100 million; * Mid Missouri CU, Ft. Leonard Wood, $100 million to $200 million; * Neighbors CU, St. Louis, $200 million to $500 million; and * CommunityAmerica, Kansas City, more than $500 million.
First place Louise Herring Award for Philosophy in Action winners were:
* Neighbors CU, $50 million to $250 million asset category; and * Anheuser-Busch Employees’ CU, St. Louis, more than $250 million.
Desjardins Youth Financial Education Award first place winners include:
* Central Missouri Community CU, $35 million to $75 million; * St. Louis Community CU, $75 million to $250 million; and * Vantage CU, Bridgeton, more than $250 million.
Electro Savings CU, St. Louis; St. Louis Community CU; and United CU, Mexico, also received platinum “You Make the Difference” achievement awards. MCUA also honored Earl Ogolin, a long-time credit union volunteer, for more than 60 years of service to the movement. He was named to the Missouri Honor Roll. He has volunteered at First Missouri CU and Southpointe CU, both in St. Louis. His wife, Moni, and sons Michael and Steve, also work in the credit union movement.

CU System briefs (10/02/2009)

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* RANCHO CUCAMONGA, Calif. (10/5/09)--The Richard Myles Johnson (RMJ) Foundation, the state foundation for credit unions in California and Nevada, has donated $17,200 in two grants for youth financial literacy efforts. Educational Employees CU, Fresno, received $10,000 to help fund the opening of a student credit union branch at Clovis West High School. Junior Achievement (JA) of Sacramento received $7,200 for its classroom presentation program. The funds will help provide financial education to 328 students in 14 elementary school classrooms next May. Volunteers from SAFE CU, North Highlands, and The Golden 1 CU, Sacramento, will present the program. The grant will fund classroom materials for the volunteers … * PEARL RIVER, N.Y. (10/5/09)--Palisades FCU, based in Pearl River, N.Y., offered unleaded gasoline at $1.99 per gallon Saturday from 9 a.m. to 1 p.m. as a thank you to the community and its New City neighbors for accepting the credit union into the community and making the New City branch a success. The gas station is diagonally across from the branch. The credit union said before the event it expected a large turnout … * HOUSTON (10/5/09)--Houston-based Primeway FCU has created a website to assist Houstonians who have been laid off from their jobs. LaidoffinHouston.com features free financial counseling, links for state unemployment and job searches, and financial advice, as well as resume, interviewing and networking tips. Other information includes how to file for unemployment and what an unemployed individual's next financial steps should be. The credit union has $261 million in assets (Houston Business Journal Oct. 2)… * INDIANAPOLIS (10/5/09)--FORUM CU, a $1 billion asset credit union based in Indianapolis, has introduced its new Sprout youth savings account for youth ages 0 to 18 to save money for college, car, down payment on a home and more. Sprout is similar to a 529 Plan or Coverdell Education Savings Accounts in that it earns interest and applies certain penalties for early closure or withdrawals. However it does not require the owner to use the money specifically on school. FORUM CU will match 10% of deposited funds per calendar year, based on different tier levels. No minimum deposit is required. The account matures when the account owner turns 18 and automatically transfers into the owner's savings account …

Student-run CUs in the limelight

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MADISON, Wis. (10/2/09)--Several student-run credit unions were in the news Thursday. Two reports highlighted student run branches in an elementary school and a middle school. Another credit union announced the opening of two branches in local high schools. ABC news affiliate WJLA aired a feature Wednesday on Apple FCU, Fairfax, Va., which has a branch in a converted storage room at Saunders Middle School. There, sixth, seventh and eighth graders can learn the business by working in it. The station conducted interviews with credit union staffer Jamie Gatchell, seventh grade employees of the credit union, Prince William County school administrative officials and a parent. To access the report, use the resource link. Educational Systems FCU, Greenbelt, Md., opened a credit union branch at Lake Arbor Elementary School on Sept. 23, according to the Gazette and Washington Post (Oct. 1). Lake Arbor is one of eight county schools using the $313 million asset credit union's program, which allows students to open savings accounts and make deposits. Julio Martinez, a school financial education coordinator for the credit union, told the Gazette that 23 students opening savings accounts on opening day. He will visit the school every two weeks to collect student deposits. Use the link to access the article. Blackhawk Community CU, Janesville, Wis., in a press release Thursday, announced it opened two student-run branches in Janesville high schools on Sept. 1. The Cougar Student CU branch is at Craig High School and is open from 11:45 a.m. until 12:25 p.m. each day school is in session. Viking Student CU branch at Parker High School will be open 11:15 a.m. to 12:25 p.m. each day school is in session. The joint project between the Blackhawk Community CU and the schools are the result of two years' preparation. Celebrations were held Sept. 23 at Cougar and Wednesday at Viking. They are the 86th and 87th student-run credit unions in Wisconsin, according to Marketing Director Donna M. Wagner.

CU System brief (10/01/2009)

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* DUBLIN, Ohio (10/2/09)--Ohio Gov. Ted Strickland has appointed Vidya Iyengar, CEO of Marion (Ohio) Community CU, to a three-year term on the state's Credit Union Council Board. Part of the Ohio Division of Financial Institutions, the council of seven members provides advice and recommendations to the regulatory agency and governor on issues of importance to credit unions. Chaired by Deputy Superintendent for Credit Unions Rose Bartolomucci, the council meets quarterly. Other council members are: Aaron Michael, Atomic CU, Piketon; Gary Soukenik, Seven Seventeen CU, Warren; Matthew Studer, Toledo Postal Employees CU; Robin Thomas, Taleris CU, Cleveland; and Linda Williams, Akron Fire Fighters' CU …

TrinidadTobago CU Policy Act draws opposition

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PORT OF SPAIN (10/2/09)--Trinidad and Tobago Labor Minister Rennie Dumas said that new legislation, the Credit Union Policy Act, will benefit credit unions. He made the statement after dozens of credit union stakeholders rejected the 67-page proposed policy at a Central Bank public meeting. Dumas' comment was read on his behalf by Permanent Secretary in the Ministry of Labor Roslyn Khan-Cummings Wednesday during the National Credit Union Symposium in Port of Spain (Trinidad and Tobago Express Oct. 1). "The credit union sector is one that is stable for decades has consistently provided access to credit facilities for our citizens," said Dumas' speech. The proposal would mean the Central Bank would supervise credit unions, although development support would continue under the Cooperative Development Division. Those opposed to the proposal said the approach to governing credit unions was a one-size-fits-all policy. They also said the proposed legislation is too stringent.

OpSS Council names two best practices winners

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MADISON, Wis. (10/2/09)--Two credit unions--Red Canoe CU of Longview, Wash., and Missoula (Mont.) FCU--are winners of the fifth annual CUNA Operations, Sales and Service (OpSS) Council's Best Practices Awards. The awards recognize innovative solutions optimizing credit union performance. Winners delivered presentations on their entries during the council's 12th annual conference, which began Sunday and ended Thursday in San Diego. Red Canoe CU won in the Sales and Service Management category for its creative implementation of the Credit Union National Association's (CUNA) Creating Member Loyalty program. With the program, the credit union saw results that included 20% deposit growth for the first six months of 2009. It exceeded its loan growth, sales performance and service goals. Staff esteem also has grown. The credit union attributes its success with the program to:
* Senior management immersion; * Pre- and post-session reporting; * Creation of follow-up sessions; * Internal promotions; * All-staff recognition; * Consistent measurement standards; and * Clarification of the terms "sales" and "service."
Missoula FCU won the Branch Design category for its Platinum LEED Certified Branch, the second building in the state to achieve the highest LEED certification. (LEED stands for Leadership in Energy and Environmental Design, a green building rating system.) In addition to being viewed as the "green" financial institution in its area, Missoula FCU's ongoing, long-term operational expenses will be reduced. It estimated it will save $20,000 a year in energy costs. Double-stacked drive-up tubes and grey-water irrigation system, which filters and reuses water from fountains, sinks and showers for watering native grass landscapes, have resulted in an ongoing public blog. The branch design also has garnered press and non-industry awards. To access the winning presentations, use the resource link.

Texas league CUR announce board elections

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FARMERS BRANCH, Texas (10/2/09)--Texas Credit Union League (TCUL) President/CEO Dick Ensweiler announced results of the TCUL and Credit Union Resources, Inc. (CUR) elections held Sept. 24. Jim Minge was elected second vice-chairman of TCUL and chairman of CUR. Minge is a senior vice president at Randolph-Brooks FCU in Universal City. He has served on the board since 2006 and represents League District 8 (LoneStar Leaguer Oct. 1). Paul Trylko was elected secretary-treasurer of TCUL and CUR. Trylko is CEO of Amplify FCU in Austin. He has served on the TCUL board since 2008, representing League District 12. In his new position, Trylko will also serve as chairman of TCUL’s Political Action Committee. Christa Hollier, was elected to the TCUL board by District 9 at a special meeting Sept 17. Hollier is CEO of Golden Triangle FCU in Groves. Last year, she was elected to the CUR board. However, with her election to the TCUL board, her CUR directorship became vacant. TCUL, as sole shareholder of CUR, elected two individuals to fill vacancies on the CUR board:
* John Barad, CEO of Union Square FCU, Wichita Falls; and * Jason Landry, CEO of Neches FCU, Port Neches.
Continuing board officers are:
* League Chair--Ayn Talley, CEO, Houston Police FCU; * League First Vice Chair--Pamela Stephens, CEO, Security One FCU, Arlington; and * CUR Vice Chair--Sandy Smith, CEO, Texas FCU, Dallas.

United FCU works to revive Clearstars auto lending

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ST. JOSEPH, Mich. (10/2/09)--United FCU--the St. Joseph, Mich.-based credit union that acquired the ailing Reno, Nev.-based Clearstar Financial CU last week--is working to revise Clearstar's auto loan program with new standards. Duane Nelson, United chief operating officer, told a local newspaper that auto loans, not risky mortgage loans, were the main factor in Clearstar's failure (The Herald-Palladium Sept. 30). Clearstar's policies on what it would loan on collateral were liberal and its rates were probably too low considering the risk involved, he said. The deal, which was coordinated with support from the National Credit Union Administration, will help United get a foothold into one of the nation's fastest-growing areas, Nelson told the publication. The Reno-Sparks metropolitan area grew 21% from 2000 to 2008. Once the economy turns around, the Reno area will grow again, Nelson said. He added the merger gives United some diversity in its member base. With the merger, United will have more than $1 billion in assets and serve more than 111,000 members in Michigan, Ohio, Arkansas, North Carolina and Nevada. Of those totals, $141 million in assets and 16,000 members are from Clearstar.

INews NowsI top 10 stories for September

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MADISON, Wis. (10/2/09)--A story about the National Credit Union Administration (NCUA) banning 12 from financial institution heads up September’s top stories for News Now. Other top 10 stories involve National Credit Union Administration Chair (NCUA) Debbie Matz’s first board meeting, and two credit union robberies. Here are the top 10 most requested News Now stories during September. Use the links to read the full stories: 10. Fed limits CARD Act minimum payment warnings to credit cards WASHINGTON (9/30/09)--Proposed amendments to Regulation Z released by the Federal Reserve today would limit the required minimum payment warning disclosures outlined in the Credit Card Accountability, Responsibility and Disclosure (CARD) Act to credit card accounts. 9. Schumer to back Sen. overdraft bill WASHINGTON (9/09/09)--Sen. Charles Schumer (D-N.Y.) announced Tuesday that he wants to see more consumer protections associated with overdraft protection plans and that he will back legislation targeting abusive practices. 8. Government lets UBIT filing date pass WASHINGTON (9/16/09)--The government let its 60 days come and go and failed to file an appeal to a federal court judge's July decision that backed a favorable verdict for credit unions in an unrelated business income tax (UBIT) case. 7. MACUA CEO resigns BISMARCK, N.D. (9/11/09)--Tony Richards, president/CEO of Mid-America Credit Union Association (MACUA), has resigned, effective immediately. 6. Dodd may introduce overdraft fee bill this week WASHINGTON (9/21/09)--Senate Banking Committee Chairman Chris Dodd as early as this week could introduce a bill that would require financial institutions to seek permission before they can enroll their accountholders in an overdraft protection program. 5. Former CU exec commits suicide during arrest MACON, Ga. (9/9/09)--A former manager of a Georgia credit union committed suicide when local authorities tried to arrest her on charges of embezzlement. 4. Matz’s first meeting: 0.15% NCUSIF assessment, CLF changes ALEXANDRIA, Va. (9/25/09)--As anticipated, the National Credit Union Administration (NCUA) on Thursday approved a 0.15% of insured shares assessment on federally insured credit unions. The action is intended to help the NCUA return the National Credit Union Share Insurance Fund's (NCUSIF) equity to 1.3% of June 30, 2009 shares and repay $310 million in funds the Stabilization fund has borrowed from the U.S. Treasury. 3. U.S. Central 2008 financial statement released WASHINGTON (9/14/09)--When assessing the December 2008 U.S. Central FCU financial statement released Friday, interested parties should remember that the reporting was completed under a since revised accounting standard that forced the corporate credit union to record a larger other than temporarily impairment (OTTI) charge than current accounting rules require, the Credit Union National Association (CUNA) said upon the release of the statement. 2. One dead, three arrested after CU robbery TAMPA, Fla. (9/28/09)--Three robbery suspects were apprehended by police and one person was found dead, an apparent suicide, in the aftermath of a Thursday robbery of Grow Financial CU, in Tampa, Fla. 1. NCUA bans 12 from financial institution work ALEXANDRIA, Va. (9/24/09)--Twelve former credit union employees have been banned by the National Credit Union Administration (NCUA) from participating in the business of any federally insured financial institution.

Kennebec Valley members vote to stay a CU

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WESTBROOK, Maine (10/2/09)--Members of Kennebec Valley FCU (KV FCU) have voted against a proposal to convert to a bank charter and then merge with Kennebec Savings Bank in Augusta, Maine. The Maine Credit Union League called the vote “a very positive outcome for both the credit union and its membership.” A credit union charter is the best choice for consumers, the league added. “This vote underscores the important role that members have in a credit union and the value that being a member-owner truly offers,” said John Murphy, Maine league president. Voting by KV FCU members on the proposed merger concluded Sept. 21. Last year, the credit union’s board approved a proposal to convert to a bank and then merge with a local savings bank (News Now Sept. 23). The board said the proposed merger and conversion would place the credit union in a better position to grow. After the proposal was approved by the board, members from KV FCU began sending letters to the editor of a local newspaper, expressing their thoughts about the proposed merger. Many members were against the proposal. Members also formed several groups regarding the merger, such as KV Members Matter, which opposed the conversion; and KV Members Voting Yes for the Merger. A group also petitioned the credit union for access to board meeting minutes in which the proposal to convert was discussed (News Now Feb. 11). KV FCU, Augusta, Maine, has $54 million in assets.

Cards help students establish credit history

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ITHACA, N.Y. (10/2/09)--Credit cards can help fiscally responsible students establish credit histories, according to a Credit Union National Association (CUNA) youth expert. If a student has the financial stability to keep up with a credit card’s balance, it can be a valuable way for the student to create a good credit score and get educated about finances, Josh Jones, CUNA manager of young adult programs, told The Ithacan (Oct. 1), Ithaca College’s student newspaper. Credit history also is important for acquiring loans, financial services, and for getting a job. Some employers look at applicants’ credit reports to see if they are in good standing--especially if the applicant would be handling money at the job, Jones told the newspaper. About 84% of undergraduates surveyed by student lender Sallie Mae have at least one credit card--an increase from 76% in 2004. Students use the cards to pay for textbooks, school supplies and commuting costs. The average amount charged by students was $2,200--compared with $942 in 2004, the newspaper said.

Its National Co-op Month

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MADISON, Wis. (10/2/09)--October is National Co-op Month, and resources are available from the National Cooperative Business Association (NCBA) to help credit unions with activities and celebration ideas. The Credit Union National Association is a member of the NCBA board of directors. The 2009 theme--“Your Values, Your Business!”--emphasizes that doing business with a cooperative means doing business with an entity that shares the same values as most Americans. To promote this year’s theme, the National Co-op Month Committee will use several vehicles to promote co-ops. They include:
* Marketing advertisements--Ad templates that convey a unified message for increasing consumer awareness; * A “group” page on the social networking site Facebook to educate consumers about Co-op Month and cooperative business; * Status updates on co-ops through social networking site Twitter; * Co-op themed promotional items to increase awareness of cooperatives available on Zazzle.com; * A Day in the Life, a publication available for download at Lulu.com and that can be distributed to members; and * A redesigned website, go.coop, for information about cooperative business.
For more information, use the link.

Schenk speaks of CU MBL on Marketplace radio

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NEW YORK and MADISON, Wis. (10/2/09)--Credit unions' ability to offer member business loans can help small businesses in a tightening market, Credit Union National Association senior economist Mike Schenk told a public radio audience on "Marketplace." He was interviewed Wednesday as part of a story about business lending becoming rarer, now that the CIT Group--the nation's largest lender to small and medium sized businesses--is scrambling to work out a deal with its bondholders to stay out of bankruptcy. CIT, which lends up to 70% of the funds businesses borrow, had earlier received $2 billion in funds from the federal government's Troubled Asset Relief Program (TARP). If that deal doesn't gel, CIT would become one the of biggest bankruptcies in the nation. A CIT failure would jolt the still-fragile economy, Schenk told senior business correspondent Bob Moon. "It would more than likely cause some small businesses to go out of business themselves. The key for any small business at this point is to be looking for alternatives." Schenk said there aren't many places for small businesses to go to get loans. Credit unions can help businesses with some types of business loans. "We keep stepping to the plate and helping these folks out as much as we can. Loans at credit unions--business loans--actually grew 14% in the 12 months ending June." For the full story, use the resource link.