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CU System Briefs (10/29/2010)

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* TRUMBULL, Conn. (11/1/10)--Personal Care America FCU, a $16.5 million-asset credit union, based in Trumbull, Conn., wrapped up its first annual Souper Bowl Warm-up on Oct. 20. Two “teams” of credit union employees took names from both the National Football Conference and the American Football Conference “played” each other for the right to play in the “Souper Bowl,” which will conclude in November. The premise was straight forward; the teams scored points when someone donated a new pair of socks, gloves or a hat; one point for each item. A team will score during the “Souper Bowl” when a food item is donated. The New York Giants beat the Philadelphia Eagles while the New England Patriots lost to the New York Jets. The Giants and the Jets are now engaged in an “epic” battle for the “Souper Bowl” title. Credit union President/CEO John E. Keet Jr. said almost 150 items were donated to The Community Closet in Bridgeport which supports local shelters and charities …

CUNA Mutuals first Online Discovery Conference draws worldwide interest

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MADISON, Wis. (11/1/10)--Nearly 1,200 credit union industry staff have registered for CUNA Mutual Group’s first-ever Online Discovery Conference, set for Nov. 3. Registration remains open until the day of the event. The free event has drawn interest from 36 credit union leagues and credit unions nationwide and globally, including the United Kingdom and Trinidad and Tobago. Registrants and those who may consider attending are encouraged to visit a YouTube link (see resource link) that provides a short primer about Online Discovery. Online Discovery is the Web-based equivalent of a face-to-face conference without the associated expenses or time away from the office. Attendees will benefit from its 11 learning sessions that feature future-focused content that will help credit unions solve problems, face challenges and address opportunities, CUNA Mutual said. CUNA Mutual is a provider of financial services to credit unions, their members and customers worldwide. In a related matter, the Credit Union National Association has announced an agreement with CUNA Mutual to bring its Discovery Conference breakout sessions to the 2011 America's Credit Union Conference (ACUC) & Expo taking place June 19 through June 22 in San Antonio, Texas. For more information, use the links.

CUNAs Schenk tells biz pubs about market economy

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NEW YORK (11/1/10)--Mike Schenk, vice president of economics and statistics at the Credit Union National Association, provided insights on consumer lending and the market to two national business publications last week. Schenk talked about the effect of lower long-term interest rates in a Thursday article titled, “The Fed’s ‘tax on the consumer.’” “Banks will have a lot more money to lend, and lower rates will make it easier for people to borrow,” Schenk told CNNMoney. “But the problem is that people are still up to their eyeballs in debt and are in the process of paying it down, so it's unclear how much more they'll be willing to borrow.” Schenk commented that the US. market is taking a more realistic look at the Federal Reserve’s actions in regard to easing--manifest through the U.S. Treasury’s recent $29 billion auction of 7-year notes--in a Thursday article titled “Stocks finish mixed amid uncertainty on Fed plans,” in The “In the last day or two, it seems like the market has started to look at Fed easing more realistically,” Schenk told the publication. “Expectations were very high for significant and immediate easing. Those expectations have come down--and rightly so--the Fed wasn't going to go in with guns blazing. “The nervousness related to the potential increases in inflation that a big move in easing could have is well understood by the Fed,” he added. Also, favorable jobs data bolstered consumer confidence, Schenk told The “A good deal of the optimism we saw earlier was related to the favorable jobs number, which is good and moving in the right direction, but when all is said and done, it doesn't change the fundamental outlook for the jobs market,” Schenk said. “Consumers are still behaving cautiously and in the mode of deleveraging.” To read the articles, use the links.

Maine CUs seek to help end hunger

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OLD TOWN, Maine (11/1/10)--Representatives from Maine credit unions’ Campaign for Ending Hunger recently joined Crossroads Ministries Executive Director Brenda Davis at Penobscot County FCU to launch her ninth annual walking tour of Maine, which aims to increase awareness of the problem of hunger during November, Ending Hunger Month. During the celebration, Davis, whose Old Town-based agency serves thousands in eastern Maine, was presented with a donation, the first of many. This year's walk officially begins Thursday at Maine State CU in Augusta and will conclude with a ceremony at Brewer (Maine) FCU on Dec. 2. The walk is expected to encompass more than 1,500 miles, about 700 of those on foot. Davis will visit 79 credit union branches in 72 communities from Kittery to Madawaska. At each branch Davis visits, she will pick up a contribution from the campaign. This year, the Maine Credit Unions' Campaign for Ending Hunger also will donate $105 to a food pantry in each of the 72 communities that Davis will visit. Since 1990, Maine credit unions have raised more than $3.5 million against hunger.

Former high school utility closet now a CU branch

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EWING, N.J. (11/1/10)--At Ewing High School, a former utility closet has become a credit union branch location with a student intern serving as its manager, reported the Trenton, N.J. Times (Oct. 27). This is the first student-run branch to be opened by Credit Union of New Jersey (CUNJ). “The concept of a student branch is not unique, per se, but they are not that common," said Andrew Jaeger, CUNJ president/CEO. “The residents of Ewing should be proud of the leadership and the foresight this district has taken.” The new branch is connected to the school’s senior experience program and a new financial literacy program. “They’re learning the theory in class and putting it to practice in the branch,” said Garret Komjathy, director of the division of banking of the State Department of Banking and Insurance. Ewing High School senior Will Burnett will run the branch on Tuesdays and Thursdays as part of his internship that provides experience and course credit. Students, faculty and staff will be able to make deposits and withdrawal funds from checking and savings accounts.

Purdue CU to change name after merger

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WEST LAFAYETTE, Ind. (11/1/10--Purdue Employees FCU (PEFCU) is changing its name to Purdue FCU to reflect its new broader membership when the merger with Members United FCU, LaPorte, Ind. takes effect Dec. 1. "Just as Purdue has grown to serve several Indiana communities through regional campuses, we are excited to expand our services to the students, faculty, staff and community of Purdue North Central and LaPorte County," said Bob Falk, president/ CEO of PEFCU. As PEFCU expands into its new market, a new logo will reflect the new name. "The credit union's look may be changing, but we are not changing who we are," Falk said. Founded on the Purdue University campus in 1969, PEFCU has more than $600 million in assets. Members United FCU was funded in 1941 as Modine Employees FCU. It received a community charter in 2000, allowing it to serve people who live, work, worship, volunteer or attend school in LaPorte County. It has $6 million in assets.

Report CUs outpace other FIs in rural outreach

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MADISON, Wis. (11/1/10)--A recent report released by the Consultative Group to Assist the Poor (CGAP) and The World Bank Group reveals that 45% of financial cooperative branches--more than any other type of financial institution--are located in rural areas where financial services tend to be least accessible. The report, Financial Access 2010: The State of Financial Inclusion Through the Crisis, also states that financial cooperatives hold the second largest global network behind commercial banks, with 23% of all physical branches, automatic teller machines (ATMs) and point-of-sale (POS) terminals worldwide. World Council of Credit Unions (WOCCU) encouraged CGAP and The World Bank Group to take a closer look at financial cooperatives for this year's report and continues to collaborate with researchers and policymakers to recognize the contributions of financial cooperatives worldwide. Report findings were based on a survey of financial regulators in 142 economies representing 94% of the global population and 98% of global gross domestic product (GDP). “These statistics highlight the crucial role that credit unions play in ensuring financial access, especially in rural areas,” said Dave Grace, WOCCU vice president of association services. “The challenge for many countries is how to translate this into higher membership growth.” WOCCU’s development programs help bridge the gap in access to financial services by working with credit unions to expand services to underserved rural communities in countries around the globe. In Mexico, WOCCU is deploying new technologies to bring services to remote areas more quickly while ensuring profitability for the credit unions. And across the world in Sri Lanka, WOCCU is working with a women’s financial cooperative to implement an agricultural lending program that combines technical farming assistance with agricultural lending. During the past three years, WOCCU’s program in Mexico, funded by the Ministry of Agriculture, Livestock, Rural Development, Fishing and Food, has worked with 54 credit unions in 22 states to expand 235 points of service into rural, marginalized areas. Through a combination of building rural branches, installing ATMs and providing mobile financial services in outlying communities, the credit unions have brought more than 200,000 people into the financial system. Some credit unions have employed the use of personal digital assistants (PDAs) on field visits to increase the efficiency and accuracy of financial transactions. WOCCU said its partnership with Sri Lanka Women’s Development Services Co-operative Society, a network of more than 120 branches, has helped strengthen the volunteer-run institution to expand rural outreach and develop a savings and agricultural lending program for women farmers. The U.S. Department of Agriculture-funded program has not only increased financial access for women farmers and their families, but also has helped raise the income of some rice farmers as much as 71% by connecting them with established markets and agricultural training. As in Mexico and Sri Lanka, credit unions worldwide are employing innovative strategies to reach and better serve their membership. For more about WOCCU’s efforts to improve financial access through credit unions, use the link.

Iowa Corporate to work with NCB to design business model

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DES MOINES, Iowa (10/29/10)--A tri-party declaration of intent to work cooperatively towards the design of a business model to meet the needs of Iowa credit unions for correspondent banking services has been signed by the National Cooperative Bank (NCB) FSB, a subsidiary of National Consumer Cooperative Bank, Iowa Corporate Central CU (ICCCU) and Affiliates Management Company, a wholly-owned subsidiary of the Iowa Credit Union League. “Although Iowa Corporate has the highest capital ratio of any corporate, due to our small size we felt it necessary to explore alternative ways of continuing to meet the needs of our members,” said Sara Flynn, CEO, ICCCU. “We are excited to work with NCB, an organization that holds many current relationships with the credit union industry and shares our mission and values of providing cooperative solutions.” The three parties to the agreement are currently working through operational details, according to a release from the Iowa Credit Union League. If they are successful in reaching a definitive agreement, they plan to review the proposal for service offerings with credit unions at a series of town hall meetings throughout Iowa when the work is finalized. “We feel strongly that our members will be offered a competitive alternative in terms of security, member service and cost,” Flynn said. “Our No. 1 priority is the continuity of service for our credit unions.” “NCB is pleased to be working with Iowa Corporate and Iowa credit unions," said Steve Brookner, president/CEO of NCB, FSB. “In furthering its mission of serving cooperatives nationwide, NCB looks forward to achieving our mutual objectives through this collaborative effort.”

The Golden 1 CU opens account for fire victims

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SCRAMENTO, Calif. (10/29/10)--The Golden 1 CU in Sacramento, Calif., announced it has opened an account to allow members of the community to donate much-needed funds to River City Food Bank, following a devastating fire that damaged both the organization’s building and its stockpile of food. “We are grateful the River City Food Bank is there year-round for the community, providing food for those in need,” said Donna Bland, interim president/CEO of the credit union. “We have made it a priority to help this organization get back on its feet as quickly as possible and part of that is providing the community with an easy way to make monetary contributions.” Eileen Thomas, executive director of the River City Food Bank, said: “We thank Golden 1 and its employees for their support. Efforts such as these will help us get back on our feet much quicker.” Establishing an account for relief efforts is the most recent action Golden 1 has made to help the River City Food Bank recover from the fire that occurred Oct. 22. Other measures include the donation of $5,000 cash and an employee canned-food drive spanning Sacramento, which has already resulted in a great response. “We have had an outpouring from employees inquiring how they can help,” Bland said. “It is always inspiring to see the sense of civic duty present in our staff.” Donations to the River City Food Bank Fire Fund account will be accepted at all Golden 1 branches. The Golden 1 has $7 billion in assets.

CUNA Lending Council announces new exec. committee

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Madison, Wis. (10/29/10)--The 2011 executive committee and officers for the CUNA Lending Council were announced during the council’s 16th annual conference held Oct. 17-20 in Las Vegas. The annual election by the council membership was held earlier in the year. The new council chair, Aaron Bresko, vice president of lending, BECU, Tukwila, Wash., succeeds Lloyd Gill, president and CEO, City County CU, Margate, Fla., who completed two terms on the executive committee. Bill Vogeney, senior vice president and chief lending officer, Ent FCU, Colorado Springs, Colo., was re-elected to the committee and named vice chair. Two new members were elected to three-year terms:
* Jennifer Cowles, vice president for real estate lending, American Eagle CU, East Hartford, Conn.; and * Dale Frankhouse, director of business services and mortgage lending, Sun Federal CU, Maumee, Ohio.
Also elected to a first term on the committee was Jason Osterhage, senior vice president and chief lending officer, Delta Employees CU, Atlanta, Ga., who was appointed earlier in the year. In addition to Gill, Dana Rawlings, CEO, Pioneer West Virginia FCU, East Charleston, W.Va. completed his executive committee term. The CUNA Lending Council executive committee also currently includes:
* Michael Long, executive vice president and chief credit officer, UW CU, Madison, Wis.; * Bonnie Doolin, senior vice president for business development, Massachusetts Credit Union League, Inc., Marlborough, Mass.; * Gayle Rust Gustafson, vice president for finance services, Rivermark Community CU, Beaverton, Ore.; * Keith Reynolds, vice president for lending/business services, Citizens Equity First CU, San Jose, Calif.; and * Charles Anderson, executive vice president for commercial banking, Arizona State CU, Phoenix, Ariz.
The CUNA Lending Council is one of the six organizations that make up the CUNA Councils, a network of nearly 5,000 credit union professionals.

Kinecta FCU helps students reach for financial empowerment

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MANHATTAN BEACH, Calif. (10/29/10)--Students from Richstone Family Center recently learned about keeping money safe and secure, ways to protect themselves from identity theft, and careers in the financial services industry during a visit to Kinecta FCU’s Manhattan Beach Member Service Center. In addition to learning these valuable lessons from Kinecta’s Financial Empowerment program, the students had the opportunity to tour the credit union and talk with the staff. “At the Richstone Center, children and teens have the opportunity to learn essential skills to help prepare them for success. The ability to manage money and plan their finances is extremely important,” said Rolando Ramirez, executive director, Richstone Family Center. Kinecta’s Financial Empowerment program is one component of the credit union’s ongoing support of the Richstone Family Center based in Hawthorne. Since 2007, Kinecta employees have volunteered to present money management lessons, provide assistance to families in need through holiday giving programs, and rally teams to participate in Richstone’s annual Pier-to-Pier Walkathon. “There is a pressing need to increase financial literacy among young people today,” said Tigran Kojoglyan, vice president, Retail Services. For more than 36 years, the Richstone Family Center has worked to prevent and treat child abuse, strengthen families, and prevent violence in families, schools and communities.

Two Houston CUs plan to merge similar cultures

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HOUSTON, Tex. (10/29/10)--First Service CU and Right Choice CU are awaiting to hear that a merger application sent to the National Credit Union Administration (NCUA) and the Texas Credit Union Department (TCUD) has been approved to combine the two institutions, it was announced on Wednesday. Both First Service President/CEO Jerry Shrode and Right Choice President/CEO David Bleazard see the merger as ‘a partnership’ between the two credit unions. “Size matters for community credit unions’ survival long term,” said David Bleazard. “We see this as a partnership of similar cultures, complimentary memberships and services.” Although Right Choice is the acquiring credit union in the transaction, the new, combined credit union will take the name First Service Credit Union to retain the brand identity. First Service is celebrating its 75th anniversary this year. Bleazard will be president and CEO of the combined credit union, with Shrode alongside focusing on strategic business development. Right Choice CU’s membership voted to convert from a federal to a state charter at a special membership meeting on July 15. Bleazard said the move to a state charter brings flexibility to concentrate on members’ needs within a 10-mile radius and allows Right Choice to focus on the underserved in the community. In addition, First Service, already a state-chartered credit union, is one of a group of credit unions that owns Town North Bank via the holding company CU Bank Shares, Inc. In order to retain First Service CU’s shares with the merger it was necessary to convert to the state charter, said Bleazard. Once First Service gets primary approval for the merger by NCUA, communications will go out to the membership on the Special Membership Meeting that tentatively set for Nov. 29, said Bleazard. First Service and Right Choice both are Houston based full-service credit unions. First Service currently serves over 34,000 members and has over $180 million in assets. Right serves over 17,000 members and has over $120 million in assets.

Spirit of International Credit Union Day hits CUs

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MADISON, Wis. (10/29/10)--In the spirit of International Credit Union (ICU) Day on Oct. 22, many activities were celebrated at credit unions nationwide to pay tribute to this year’s theme which was “Local. Trusted. Serving You.” Some credit union events and festivities to celebrate ICU Day included:
* Mid-Cities Financial CU in Compton, Calif., asked members to give testimony as to why they are credit union members in celebration of ICU Day. “We wanted to celebrate International Credit Union Day with more than the traditional branch balloons and cookies,” said President/CEO Melia Keller. “We wanted our members to talk about why their Credit Union is so important to their lives and well-being. To see the heart-warming messages of the numerous ways we’ve helped our members touched our board and staff.” To view the video stream testimonials, use the resource link for Mid Cities Financial CU. * The University of Louisiana FCU (ULFC) in Lafayette, La., got into
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the spirit of ICU Week, beginning by dressing in camouflage. The rest of the week, the staff was dressed in New Orleans Saints football gear, pajamas, and ULFCU dress to celebrate ULFCU’s homecoming last weekend. ULFCU also had some fun things planned for its members. Wednesday was kids day, when kids came in and received a special gift and entered the coloring contest. Thursday was member-appreciation day, in which members enjoyed hot dogs and door prizes. Friday, anyone who joined the credit union received a gift and those who referred them received a free gift. * Discovery FCU in Wyomissing, Pa., celebrated ICU day with lots of free treats, goodies, and giveaways for everyone to enjoy. The credit union held a drawing for one member to win a $50 gift certificate to Target, and members were encouraged to take an environmentally friendly tote bag and fill it with all sorts of free items such as notepads, pens, hand sanitizers and more. Discovery employees also participated in a popular community Halloween parade and distributed credit union information and treats. “International Credit Union Day would not be possible if it wasn’t for our members,” said Ed Williams, president/CEO of Discovery FCU. “This day is dedicated to them, as much as we are dedicated towards providing them premium financial products and outstanding member service.” * Pennsylvania State Employees CU (PSECU) in Harrisburg, Pa., participated in several activities, including what is now an annual tradition: allowing employees to spend the day assisting local nonprofit organizations. In the Harrisburg area, nine credit union volunteers spent the day at the American Red Cross of the Susquehanna Valley, the YWCA of Greater Harrisburg, the Humane Society, and the Central Pennsylvania Food Bank. In State College, one employee assisted The Second Mile, an organization whose mission is to help young people. In Indiana, Pa., one volunteer lent a hand at the Indiana County Community Action Program. Also, members of the PSECU Senior Management team volunteered at the Central Pennsylvania Food Bank packing Elder Share food boxes later that day. Barbara J. Bowker, vice president of Marketing for PSECU, said, “Having our employees working out in the community gives us an opportunity to not only share manpower but to also show how we put the credit union philosophy of People Helping People into action.” * Service 1st FCU in Danville, Pa., planned a full week of community
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service projects to celebrate this year’s International Credit Union Week slogan, “Local. Trusted. Serving you.” The weeklong lineup of volunteer projects dubbed “C.U. Around Town” began on Oct. 18 and continued through Oct. 22. Projects included cleaning at the Ronald McDonald House and House of Care, trail clean-up at the Montour Area Recreation Commission, landscaping and clean-up at Hope Enterprises, Inc, staffing the Danville Child Development Center’s book sale, and baking desserts for the Gate House Shelter’s ham loaf dinner. In addition to supporting the community through service projects, Service 1st has used only local businesses to cater its four Ribbon Cutting, Open House, and Grand Opening events for the week in celebration of the new Service 1st Corporate Center located in Danville. * Two North Carolina credit union chapters got an early start on ICU Day, holding their celebrations on the evening of Oct. 19. The Foothills Chapter celebrated in Hickory, while the Western Chapter converged on Mills River to hold their event. Folks in the Foothills marked the worldwide celebration of credit unions with live music at the Gateway Best Hotel in Hickory. The Adam Rose Band provided entertainment through the evening to the more than 40 people in attendance, playing hits from the 1970s and 1980s. Meanwhile out west, nearly 150 people converged on the Forge Valley Event Center in Mills River as the Western Chapter celebrated with a night of food and entertainment. The Wayne Dalton Band provided an energetic mix of music through parts of the evening, and the chapter also continued the trend that has swept the state in recent years by holding a talent show to cap the evening's excitement (North Carolina Credit Union League’s The Weekly Update Oct. 22). * Members of San Diego-based Credit Union Car Club (CUCC) presented
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a $21,500 donation to Rady Children’s Hospital in San Diego on ICU Day. The donation included a matching amount from Rancho Cucamonga, Calif.-based CO-OP Financial Services and proceeds from CUCC’s Third Annual Car Show and its first car sale. Proceeds came from participating dealers, vendors, credit unions and credit union organizations including the California Credit Union League and the Credit Union National Association. The event was held in the parking lot of California Coast CU’s corporate headquarters in San Diego on Sept.18-19. Credit unions promoted the event and provided onsite loan approvals.

Plea deals explored in Detroit CU fatal robbery

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DETROIT (10/28/10)--Two men facing a possible federal death sentence for their involvement in the murder of an armored-truck courier during a robbery at DFCU Financial CU in Dearborn Mich., are looking to make plea bargains to avoid the death penalty. Norman Duncan and Kevin Watson are charged with killing guard Norman Stephens in 2001 while committing a $204,000 robbery at the credit union. Federal Judge Victoria Roberts wants an update on negotiations by Dec. 9, according to court filings (Associated Press Oct. 26). Timothy O'Reilly, 37, who was convicted in the killing of the guard got a life sentence, without parole, instead of the rare death penalty sought by prosecutors (News Now Aug. 27). The death penalty would have required a unanimous decision from the 10-woman, two-man jury, but only four jurors voted in favor of the death penalty (The Detroit News Aug. 26). The jury returned its verdict for O’Reilly Aug. 25. The guard, Norman Stephens, 30, was shot twice while restocking ATMs at Dearborn FCU (now DFCU Financial CU) on Dec. 14, 2001. Michigan was the first state to outlaw the death penalty, but the penalty can be used in certain federal cases. The last execution in the state occurred in 1938. The last person sentenced to death under federal law in Michigan is still on federal death row in Terre Haute, Ind., said the Detroit Free Press (Aug. 26).

Husband wife team convicted of 200000 CU theft

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WORCESTER, Mass. (10/28/10)--A husband and wife have be found guilty of stealing more than $200,000 in 2002 from the Wyman-Gordon FCU, now called W-G FCU, in Worcester, Mass., where the woman worked. After being found guilty in Worcester Superior Court Tuesday, George Labadie and Susan Carcieri are scheduled to be sentenced Monday (Associated Press Oct. 27). The couple staged the robbery in August 2002 at the credit union where Carcieri worked as an office manager, prosecutors said. Labadie was convicted of counterfeiting. After the robbery, large amounts of cash were found in the couple’s home, the AP said. The couple robbed the credit union because they had financial difficulties, authorities said. The couple has said they are innocent and that they kept large sums of cash in their home, according to the Worcester Telegram & Gazette (Oct. 20).

N.J. league creates Corporate CU Future State Task Force

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HIGHTSTOWN, N.J. (10/28/10)--The New Jersey Credit Union League (NJCUL) has created an eight-person Corporate Credit Union Future State Task Force to assist its member credit unions in evaluating the current state of the corporate network and future options for corporate services, within the corporate system and beyond. “We think this task force can play an important role in helping our members understand the options they will have going forward,” said NJCUL President Paul Gentile. “So many credit unions are concerned and worried about the future of corporate services they have relied on for decades. The best way to overcome the uncertainty is to get educated on the landscape.” The eight-person task force is made up of leaders from two categories: credit unions with less than $25 million in assets and credit unions with more than $25 million in assets (New Jersey Credit Union League’s Daily Exchange Oct. 22). The scope of the task force is to:
* Provide a baseline on the current state of corporate credit unions that serve the majority of New Jersey credit unions; * Evaluate the business plans of the corporate credit unions that serve most New Jersey credit unions for effectiveness of a sustainable business model; * Identify and evaluate other potential providers of corporate services--including payments, settlement, liquidity, investments--beyond the corporates that serve the majority of New Jersey credit unions; providers will include other corporates and/or like entities and other providers; * Establish principles that guide the future desired model of the corporate credit union system, and/or how credit unions receive traditional corporate services of payments, settlement, liquidity and investments.
The task force will deliver a report of its findings for potential use by NJCUL members to aid in their decision-making process for securing corporate services in the future.

Virginia League announces social responsibility awards

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LYNCHBURG, Va. (10/28/10)--The Virginia Credit Union League announced the winners of its 2010 Social Responsibility Recognition Awards. First-place winners of Desjardins Youth Financial Education Awards were:
* DuPont CCU, Waynesboro, greater than $250 million asset category; * Synergy One FCU, Manassas, $75 million to $250 million; and * Virginia Educators’ CU, Newport News, $35 million to $75 million.
First-place winners of the Dora Maxwell Social Responsibility Recognition Program Awards for outstanding community projects and charitable good works were:
* Bayport FCU, Newport News, $500 million-plus asset category; * NSWC FCU, Dahlgren, $200 million to $500 million;
The Louise Herring Award for Philosophy in Action awarded first places to:
* DuPont CCU, greater than $250 million asset category; and * Bronco FCU, Franklin, $50 million to $250 million. CUs offer great rates

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NEW YORK (10/28/10) recently highlighted credit unions’ abilities to offer “a great rate” on deposit accounts because they are organized as nonprofit cooperatives. Don Taylor, a financial expert who authors Bankrate’s “Dr. Don” column, responded to a question from a reader who wanted to know how a credit union could afford to offer money market account interest rates of 1.75% on deposits of more than $50,000. Taylor also told readers that people with a common bond originally formed credit unions, but membership at many credit unions is now open to anyone who lives or works in a certain geographic area. Readers were directed to the Credit Union National Association’s online credit union locator to find a local credit union. To read the article, use the link.

Discover CU members more positive about personal finances

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MADISON, Wis. (10/28/10)--Credit union members have a more positive view of their personal finances than nonmembers, according to a Discover Financial Services survey. The U.S. Spending Monitor survey conducted by Discover showed that 38% of members rated personal finances as excellent or good, compared with 30% among the nonmember group (Dow Jones Newswires and WSJ Online Oct. 27). Just 17% of members said their finances were poor, while 29% of nonmembers chose that description for their finances. More than half of members and nonmembers alike shared the perception that the overall economy is worsening. About 2,500 of the more than 8,000 people surveyed were members of U.S. credit unions.

Social media can help CUs increase share of mortgage market

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LAS VEGAS (10/27/10)--Credit unions can use social media to create connections with realtors and increase their share of the mortgage market, according to Terri Murphy, chief information officer of U.S. Learning Inc., Memphis, Tenn. Murphy told the audience at the American Credit Union Mortgage Association (ACUMA) 2010 Annual Conference that realtors typically do not know credit unions offer mortgages. That means credit unions are often “starting from scratch” (National Mortgage News Oct. 25). Social media and personalized Web pages can help credit unions reach Realtors, Murphy said. She described LinkedIn, a professional social networking platform, as “one of the best ways to find strategic partners.” Murphy encouraged credit unions to try other social media tactics, including:
* Blog sites, which are cheaper to operate than a web site. Murphy said blogs should be “at the hub of a credit union’s online presence” because they allow credit unions to provide information about their brand and expertise directly to consumers. * Twitter “microblog” posts, which can offer tips to members about a credit union’s services. Twitter can also monitor what members and nonmembers say about credit unions to provide unfiltered feedback. *YouTube, which responds to consumer’s preference for video over text. Credit unions can record testimonials or make short videos about how they solve problems for members.
Murphy said credit unions should emphasize connections instead of marketing as they reach out to realtors. Building trust will be important to help realtors understand how credit union services differ from competitors.

Mass. CU receives award for helping Haiti earthquake victims

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BOSTON, Mass. (10/27/10)--Medical Area FCU, Brookline, Mass., has been honored for using a low-interest loan program to help employees of Brigham and Women’s Hospital (BWH) offer financial assistance to family and friends in Haiti after the January 2010 earthquake. The hospital presented an Outstanding Recognition Award to the $66.4 million asset credit union to honor staff members for their support. A hospital representative noted that Ann-Marie Gordon, Medical Area FCU’s vice president of operations, worked with operating room assistants on both day and night shifts to offer confidential financial guidance after the earthquake.

Texas CU Flies Juntos Avanzamos Flag

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DALLAS (10/27/10)--When Fort Worth, Texas, resident Hermes Escobar’s mother-in-law had a heart attack, his family struggled with how they would come up with the money to fly to Nicaragua to be with her. He had been a member at Fort Worth-based EECU for a short time and had only just begun to establish a credit history. With no other options, he visited his credit union’s branch, and within minutes, EECU gave Escobar the loan his family needed to travel to his native Nicaragua. For the efforts the $1.13 billion-asset EECU makes to meet the financial services needs of members like Escobar, the Texas Credit Union League (TCUL) awarded EECU with its Juntos Avanzamos designation (LoneStar Leaguer Oct. 27). “This designation is not one that is simply given away,” said Dick Ensweiler, TCUL president/ CEO. “Credit unions must earn it by demonstrating their undying commitment and heartfelt passion to the economic empowerment of Hispanic families. An unfortunate reality is that a significant gap continues to exist between our underserved communities and financial mainstream.” “Access to affordable financial services is critical to building wealth, and EECU is to be commended for their efforts to narrow this gap,” Ensweiler added. Juntos Avanzamos is an outreach initiative TCUL created to empower Texas credit unions to more effectively meet the needs of their Hispanic community. Earlier this year, TCUL partnered with Iowa-based Coopera Consulting to strengthen and expand the Juntos program. The top priority was to evaluate and improve the application process. Coopera had already developed the Hispanic Opportunity Navigator (HON), a comprehensive assessment tool that provides credit unions significantly greater insight into serving the Hispanic population. After completing this assessment, a credit union will have the prioritized steps necessary to become the financial institution of choice serving Hispanics within its field of membership. TCUL has now made it mandatory that any Texas credit union interested in earning the Juntos Avanzamos designation must first go through the HON. EECU was one of the early embracers of the HON. A press conference to celebrate EECU’s “induction” into the Juntos Avanzamos initiative was held at its northside branch Oct. 21, which is International Credit Union Day--a day in which credit unions and their members celebrate the history of the credit union movement. Escobar not only attended the Oct. 21 celebration, he also helped raise the “Juntos Avanzamos” flag--signaling to the Hispanic community that they can receive dignified services at this credit union.

ACUC adds CUNA Mutual breakouts to sessions

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WASHINGTON (10/27/10)--Always seeking to increase excellence in its conference offerings, the Credit Union National Association (CUNA) has announced an agreement with CUNA Mutual Group to bring its Discovery Conference breakout sessions to the 2011 America's Credit Union Conference (ACUC) & Expo taking place June 19 through June 22 in San Antonio, Texas. The ACUC & Expo is an annual educational conference known for innovative learning experiences and one-of-a-kind networking opportunities. Attendees become better prepared to address the critical issues that their credit unions face, as well as prepare for future challenges that effect strategic growth. The conference attracts attendees from full-service credit unions who are key decision makers and their volunteer boards. “America’s Credit Union Conference & Expo is consistently rated as the most innovative and progressive conference in the industry,” said Bill Cheney, president/CEO of CUNA. “By collaborating to bring the Discovery sessions to America’s Credit Union Conference & Expo, we are leveraging our collective strengths to create a truly diversified and educational experience.” “Collaboration is more important today than ever before in the credit union market. By joining forces, CUNA and CUNA Mutual are collectively demonstrating true commitment to supporting and serving the credit union movement,” added Jeff Post, CUNA Mutual president/CEO. This year, in Las Vegas, the ACUC teamed with the World Council of Credit Unions to bring attendees The 1 Conference in July, bringing together a national and international focus on credit union issues. For more information, use the link.

CUNA Mutual challenges Kentucky CUs to strategize growth

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LOUISVILLE, Ky. (10/27/10)--Scott Powell, managing director of MEMBERS Capital Advisers, Madison, Wis., challenged credit unions at the Kentucky Credit Union League Annual Meeting and Convention to generate ideas and strategies to grow their loan business. Powell told Kentucky credit union leaders that the global economy and capital markets face continued challenges that will hamper economic growth and keep short-term interest rates lower than expected. Meanwhile, consumers will struggle with job loss and underemployment. American households will engage in “de-leveraging” practices such as paying down debt, dealing with defaults and bankruptcies and remaining risk-averse in their spending and investments. While the Kentucky outlook is slightly better than the national economic recovery, margins for Kentucky credit unions are still tight and will continue to shrink. To grow their loan business in this environment, Powell said credit unions must become more aggressive. Powell advised credit unions to develop highly-targeted, value-added lending programs that appeal to higher-quality credits within their member profiles to build the asset side of the balance sheet.

Bank of Tanzania invites WOCCU to develop reg. framework

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MADISON, Wis. (10/27/10)--At the Bank of Tanzania’s request, the World Council of Credit Unions (WOCCU) will soon begin developing and implementing a regulatory framework for the country's savings and credit cooperative societies (SACCOS), or credit unions. Bank of Tanzania is the country's central bank.
Click to view larger image The World Council of Credit union’s new regulatory framework will help strengthen Tanzania’s credit unions to bring safe and sound services to communities that only have access to informal savings and loan groups, such as the one pictured. (Photo provided by World Council of Credit Unions)
WOCCU’s program will involve training regulators from the Cooperative Development Department (CDD)--part of the Ministry of Agriculture, Food Security and Cooperatives on risk-based supervision and regulatory systems and policies, and effective operational and financial standards for SACCOS. WOCCU’s initiative is its first credit union development program in Tanzania, an east-central African country. Tanzania’s SACCOS range from informal, community-based cooperatives to employer-based institutions that took root as part of a government-sponsored microfinance initiative in the 1960s. The institutions follow traditional operating guidelines whereby members are required to establish a particular amount in savings to obtain a loan, and loan sizes are determined as a multiple of the member’s total savings. Liquidity is scarce, and waiting periods to obtain a loan are long. Many SACCOS employees are volunteers, and despite being the most prevalent semi-formal financial intermediary in the country, regulation and supervision to date have been virtually non-existent. Though SACCOS lack proper guidance and oversight, the number of financial cooperatives in Tanzania has exploded in recent years. In 2009, more than 5,500 licensed savings and credit cooperative societies were in operation, an increase of more than 50% in three years. Despite the proliferation of SACCOS, no single entity provides centralized financial or statistical information on the institutions. SACCOS can be found operating for as long as six months in arrears without reliable data, and regulatory authorities have conducted little analysis of the information that does exist. As the SACCOS’ sector continues to grow, it faces an increasing need for central oversight to ensure appropriate financial discipline to protect member savings. With the increasing prevalence of SACCOS in Tanzania, potential outreach is high. Recent studies show that just 11% of the country’s population has access to some type of financial institution. In a 2007 appraisal of the SACCOS sector, WOCCU found that the system was capable of broadening the availability of financial services beyond its current outreach of 800,000 people nationwide, but that it needed to overcome a series of constraints before significant development could occur. “Tanzania’s SACCOS sector has enormous potential to provide safe and affordable financial services to a broad cross-section of the population, but its relative size and lack of regulatory resources have hindered growth,” said Brian Branch, WOCCU executive vice president and chief operating officer. “Establishing proper reforms, a framework for safety and soundness and financial disciplines to protect member savings are the biggest hurdles and the first steps to reaching that potential.” WOCCU is working closely with CDD to develop and implement a modernized regulatory framework, train key staff in risk-based supervision, create an early warning system, develop policies for intervention and provide guidance in helping SACCOS improve their financial structure and operations.

Childrens Miracle Network CUs start holiday fundraising

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SALT LAKE CITY, Utah (10/26/10)--Paper icons linked to a variety of seasonal themes are available as part of the Credit Unions for Kids holiday campaign to benefit Children’s Miracle Network hospitals. The campaign allows credit unions to choose the theme that works best for their members. For example, a credit union that chooses a football-themed promotion can offer paper football icons. Other icon options include turkeys, a Christmas bulb and snowmen. Credit union members typically purchase the seasonal icons for as little as $1, with all proceeds benefiting the Children’s Miracle Network hospital serving the credit union’s community. Holiday campaign kits can be ordered at no cost to participating credit unions. The kits include the icons, campaign information, a donation reporting form and a pre-addressed envelope for submitting the donation. Use the resource link below for orders.

Mid-America CU Assoc. launches small-biz lending website

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BISMARCK, N.D. (10/26/10)--Mid-America Credit Union Association has launched a website to promote credit unions as a small-business lending resource for consumers, credit union members and prospective members in North Dakota and South Dakota. The Credit Union Business Lending website reflects efforts to increase awareness in the Dakotas about credit unions’ role in fostering small businesses and offering small-business loans and financial services without government assistance or taxpayer funds. Small businesses in the Dakotas are finding it increasingly difficult to obtain credit, according to Mid-America CEO/President Robbie Thompson. The business lending website offers frequently asked questions (FAQs) about the credit union difference, information about credit union’s “safe and sound” financial operations; and help in finding a credit union. Mid-America intends to expand the interactive site by sharing member business lending success stories from credit unions in the Dakotas and adding links to agencies such as the Small Business Administration. For more information, use the link.

Illinois League announces award winners

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NAPERVILLE, Ill. (10/26/10)--The Illinois Credit Union League announced the winners of its statewide Desjardins, Dora Maxwell and Louise Herring awards. Winners of the Dejardins Youth Financial Education Award for leadership in youth financial literacy were:
* NuMark CU, Joliet, first place in the $50million to $150 million-asset category; * Argonne CU, Romeoville, first place, $150 million to $500 million; and * Great Lakes CU, North Chicago, first place, more than $500 million.
Winners of the Dora Maxwell Award for outstanding community projects and activities were:
* Cornerstone CU, Freeport, first place, $50 million to $100 million-asset category; * Streator Onized CU, Streator, first place, $100 million to $200 million; * Financial Plus CU, Ottawa, second place, $100 million to $200 million; * GCS FCU, Granite City, first place, $200 million to $500 million; * Great Lakes CU, North Chicago, first place, more than $500 million; and * Scott CU, Collinsville, second place, more than $500 million.
The Louise Herring Award for Philosophy in Action went to Scott CU, Collinsville, which received first place in the more than $500 million asset category. The award honors credit unions that make exceptional efforts to include credit union philosophy in daily operations and member service.

CU System Briefs (10/25/2010)

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* PORTLAND, Maine (10/26/10)--At its annual conference Oct. 14, the Maine Public Relations Council (MPRC) presented Jon Paradise, governmental and public affairs manager at Maine Credit Union League, with the 2010 Edward L. Bernays Award, the highest honor given by the council to an individual public relations professional. This award was created in 1987 to honor outstanding contributions to the public relations profession and is named for Edward L. Bernays, widely regarded as the father of modern public relations. MPRC has more than 300 members, including representatives from most of the state’s largest and most influential organizations. Paradise is past president of MPRC. He oversees communication efforts for the organization and the state’s 64 credit unions. He was recognized for his work for the Maine league and member credit unions and for his community service activities, including his efforts in support of the Maine Credit Unions’ Campaign for Ending Hunger, Maine Children’s Cancer Program, and Financial Literacy ...

Wis. CUs beat other lenders with mortgages to underserved

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PEWAUKEE, Wis. (10/26/10)--Credit unions are more likely to approve low-income and minority borrowers’ home loans in Wisconsin than are non-credit union lenders, according to the most current figures available under the Federal Home Mortgage Disclosure Act, said the Wisconsin Credit Union League. Based on 2009 data--the most recent available--low-income mortgage borrowers’ approval rate was 72.2% at Wisconsin credit unions compared to 65.5% at non-credit union lenders. For minority mortgage applicants, the credit union approval rate in Wisconsin was 78%, compared with 58.2% at non-credit union lenders. “Credit unions continue to outperform other lenders in mortgages to financially underserved groups because of their unique member-ownership structure,” said Brett Thompson, league president/ CEO. “Because credit unions exist to serve their member owners, as opposed to chasing profits, credit unions can make mortgage decisions based primarily on members’ needs. So credit unions will make smaller loans on more modest homes. They’re also more accessible to low-income and minority borrowers.” Although credit unions have only about a 10% market share for financial services in Wisconsin, they operate 40% of the financial institution branches in the state’s low-income census tracts. By contrast, 94% of all Wisconsin banks--including 12 of the largest 20 banks--have no branches in low-income census tracts. Credit unions have been applauded for serving the underserved while avoiding the exotic lending practices that led to today’s economic stress. Barney Frank, chair of the House Financial Services Committee has said, “If credit unions made all of the mortgage loans, then there would have been no subprime crisis, and therefore no economic crisis.” Overall, Wisconsin’s lower income consumers save an estimated $44 million because they have access to member-owned credit unions instead of higher-cost for-profit institutions, the league said. Helping members save and build wealth is the aim of credit unions’ REAL Solutions initiative. The effort has been honored with four Governor’s Financial Literacy Awards.

Final nomination received for CUNA Board

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MADISON, Wis. (10/26/10)--One final nomination has been received for seats on the Credit Union National Association (CUNA) board of directors. The most recent nomination was for Scott Waite, senior vice president/chief financial officer for Patelco CU, San Francisco, for the District 6, Class C seat. The nomination brings the total nominations to 14 for board seats. The deadline for nominations was Friday. Voting will take place from Wednesday through Dec. 17. Ballots will be sent on Wednesday for the three contested elections in District 2, Class B; District 4, Class A; and District 6, Class C. Nominations also have been received for:
* Robert Falk, president/CEO of Purdue Employees FCU, West Lafayette, Ind., District 2, Class B; * Patrick J. Drennen, CEO of 1st Gateway CU, Camanche, Iowa, District 4, Class A; * Dennis A. Fisher, president/CEO, First Security CU, Lincolnwood, Ill., District 4, Class A; * Brian Smith-Vandergriff, board member of Catholic Family CU, Kansas City, Mo., District 4, Class A; * Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, District 4, Class A; * Jeff York, president/CEO of CoastHills FCU, Lompoc, Calif., District 6, Class B seat; * Stephen G. Behler, president/CEO of Kemba CU, West Chester, Ohio, District 2, Class B seat; * Brett Martinez, president/CEO, Redwoods CU, Santa Rosa, Calif., running for a District 6, Class C seat in a special election; * Harriet May, president/CEO, GECU, El Paso, Texas, District 5, Class C. May is currently CUNA's chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. The others elected will take office Feb. 28 and serve a three-year term that expires at the adjournment of the 2014 CUNA Annual General Meeting.

Conn. CUs host first Financial Reality Fair

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MERIDEN, Conn. (10/25/10)--More than 320 students from Hillhouse, North Haven, ACES and Shelton high schools participated in the first Connecticut Financial Reality Fair for the 2010-2011 school year in the New Haven Field House, New Haven, Conn.
Students wait their turn, make their choices, and enter details on their budget sheets at the first Connecticut Credit Union Financial Reality Fair of the 2010-2011 school year held Wednesday at the Field House in New Haven, Conn. (Photo provided by the Credit Union League of Connecticut)
Credit unions in the state identified and responded to the need for high school students to learn how to properly handle their finances by creating this unique experience, said the Credit Union League of Connecticut. Partnering with local businesses, credit unions have produced fairs for high schools in Connecticut since the 2008-2009 school year. On Wednesday, students experienced the real-life challenges of living within a budget and paying bills, while being tempted by “fun” purchases. “This is harder than I expected,” said a student from Hillhouse High. “I thought I was making good money, but I can’t buy a new car and pay for my apartment without a roommate.” Some students found they could not afford the level of living they expected to have after graduation, while others stated they were going to reevaluate their career choice. Connecticut credit unions will hold their next Financial Reality Fair in Hartford on Nov. 17.

Guam CU aims to be first certified commercial green building in country

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MAITE, Guam (10/25/10)--Coast360 FCU hopes to be the first commercial building in Guam to be certified by the U.S. Green Building Council as environmentally friendly. The new three-story, 49,000-square-foot headquarters’ building in Maite, Guam, provides several green solutions to reduce its environmental footprint (Pacific Daily News Oct. 21). Among the feaures are:
* Outside, a rooftop garden over the drive-up window lanes makes it cooler for members driving up to do their banking; members with low-emission vehicles have their own parking spots; and customers with electric cars can park near a recharging station to power up while they’re inside. * Inside, large wind-resistant windows let in the natural light, lowering the use of electricity; and a rainfall retrieval system catches rainwater to be used for watering drought-resistant plants and providing water for restrooms.
The certification process can take up to eight months. Once the entire process is finished, Coast360 FCU said it hopes to be able to hang the Leadership in Energy and Environmental Design-certified silver plaque on its sustainable lumber walls.

Filene report maps Walmarts banking moves

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MADISON, Wis. (10/25/10)--Filene Research Institute’s latest report maps out the shape of Walmart’s retail financial services footprint in the U.S. and Mexico, going on to suggest that the world’s largest retailer has much more in store. The Blended Walmart Business Model, by Filene Research Fellow Robert Manning, knits together the many angles of Walmart’s involvement in banking services: from its 2007 charter travails to its foray into Mexican banking and to its long-term strategy of providing financial services--with or without a formal bank charter. In the report, Manning studies Walmart’s claims of low-price leadership in financial services and its retuned approach of offering financial products through partnerships in the U.S. and through an independent charter in Mexico. Highlights from the report include:
* Walmart still wants a bank charter. The potential from finance and penalty fees combined with interchange fee savings’ could easily garner more than $1.3 billion annually from Walmart’s payment card system and portfolio of customer credit card balances. * Walmart already offers a compelling range of benefits to potential banking customers: convenient locations and hours, welcoming atmosphere, familiar customer service, straightforward fees and fast transactions. * Walmart is targeting finance because it pays. The profit margins of Walmart’s traditional retail sales average 23.7% gross and 3.5% net, whereas the averages for comparable financial services companies range from 14% to 38% gross and 6% to 9% net.
Manning makes a case that Walmart’s plan is advancing even without a U.S. bank charter. Today, the retailer mainly offers ancillary financial products, but it may soon operate in the more traditional business model of deposits and loans, said Filene.

SECU annual meeting boasts 1000 attendees

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RALEIGH, N.C. (10/22/10--State Employees’ Credit Union (SECU) welcomed more than 1,000 member-owners for its 2010 Annual Meeting, Oct. 12, in Greensboro, N.C. The meeting featured a luncheon and educational workshops for SECU Advisory board and Loan Review committee volunteers. Guest speaker Patrick Adams, president of St. Louis Community CU, empowered luncheon attendees, and volunteer educational sessions highlighted a variety of topics including fraud prevention, SECU services provided to members at various life stages, and newer SECU products and initiatives to combat overdrafts. The day concluded with the general membership meeting for all SECU members, with Board of Director’s Chair Jim Barber presiding over the event. During the general meeting, Barber presented an overview of the SECU’s fiscal health and stability, along with updates on previous and current year initiatives. “With the ongoing economic crisis, members are looking to do business with an institution on which they can trust and depend--folks that put members first,” Barber said. “That’s why SECU’s unique credit union model is so successful in today’s financial marketplace. With fair treatment of members, continued financial stability, low-cost services, a desire to help others and tremendous branch convenience, SECU truly is serving all of North Carolina.” Joining Barber during the general meeting, SECU Foundation Chair Shirley Bell highlighted numerous Foundation initiatives from the past fiscal year. “Through the SECU Foundation, SECU members collectively invest in the future of North Carolina," Bell said. "Whether in the field of education, housing, health or human services, large-scale projects are being accomplished with much enthusiasm and excitement.” A video pictorial featuring the statewide projects of the member-funded Foundation also was presented to attendees.

Entrepreneur 8 wins Biz Kid contest

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NEW BERLIN, Wis. (10/25/10)--Landmark CU in New Berlin, Wis., is honoring some special kids who have started their own businesses and created their own jobs. Addie Buege, age 8, of Wauwatosa, is a great example. She is the grand prize winner in the Landmark CU Biz Kid$ Essay Contest for young entrepreneurs age 8-15.
Click to view larger image Winners in New Berlin, Wis.-based Landmark CU’s Biz Kid$ Essay Contest for young entrepreneurs age 8-15 were, from left: Kevin Mikolajczak, Bryce Jurss, Addie Buege, Jenna Gazzana and Lawrence Bell. (Photo provided by LandMark CU)
Buege’s business is called “Pretty U Boutique”. She makes hair accessories and sells them at farmers’ markets. “This is the type of entrepreneurial spirit we were looking for with our Biz Kid$ Essay Contest,” said Ron Kase, Landmark’s president. “All the entries are delightful and show how clever and industrious kids can be. Landmark supports small business and supports youth financial literacy. This essay contest is a fun way to promote both at the same time,” he added. There are 12 winners in all, with Buege receiving the $500 Grand Prize. Four runner-up prizes of $100 each were awarded to:
* Jenna Gazzana, age 11, of Germantown, Wis., for her “Charity Helpers”, selling jewelry, bookmarks, etc.; * Bryce Jurss, age 13, of Hartford, Wis., for his video productions, conversions, photography and sound track editing business; * Kevin Mikolajczak, age 13, of Milwaukee, for CiedWeb, Inc., a graphic design and tech support and training business; and * Lawrence Bell, age 15, of Milwaukee, for Belltown Productions, his special-occasion photography and videography business.
Seven honorable mention prizes of $25 each were awarded to:
* Rylee Smith, age 10, from Milwaukee, for “RyleeCakes”, selling brownies, cookies and cakes using less sugar and organic ingredients; * Payton Fitzgerald, age 9, of Milwaukee, for her bottle-cap necklaces and ornaments; * Lora Fetzer, age 10, of Brookfield, Wis., for her J.O. Jewelry; * Hunter Tunnicliff, of Waukesha, Wis., age 14, for his Online Training/Pro Web Design business; * Christopher Kneiser, of Oconomowoc, Wis., age 12, for his Lemonade Stand; * Luis Gomez of Milwaukee, age 9, for his J.R’s card, toys, lollipops business; and * Michael Tiffany, of Kenosha, Wis., for his “Church on the Go” business.
Entries were judged on the success of the business, the creativity/originality of the business, and the organization/legibility of the submitted entry materials. Judges were Paula Kiely, director of the Milwaukee Public Library and Tim Greinert, president of Junior Achievement of Wisconsin, Inc. Landmark CU, sponsor of the Biz Kid$ Essay Contest, also sponsors the Biz Kid$ TV program on Milwaukee’s PBS station.

Two more nominations for CUNA Board

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MADISON, Wis. (10/25/10)--Two more nominations have been received for seats on the Credit Union National Association (CUNA) board of directors. The most recent nominations were for Patrick J. Drennen, CEO of 1st Gateway CU, Camanche, Iowa, for the District 4, Class A seat; and Robert Falk, president/CEO of Purdue Employees FCU, West Lafayette, Ind., for the District 2, Class B seat. The nominations bring the total nominations to 13 for board seats. Drennen will be running against Dennis A. Fisher, president/CEO, First Security CU, Lincolnwood, Ill., Brian Smith-Vandergriff, board member of Catholic Family CU, Kansas City, Mo., and Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, for the District 4, Class A seat. That’s the only contested race in the elections. The deadline for nominations was Friday. Voting will take place from Wednesday through Dec. 17. Nominations also have been received for:
* Jeff York, president/CEO of CoastHills FCU, Lompoc, Calif., District 6, Class B seat; * Stephen G. Behler, president/CEO of Kemba CU, West Chester, Ohio, District 2, Class B seat; * Brett Martinez, president/CEO, Redwoods CU, Santa Rosa, Calif., running for a District 6, Class C seat in a special election; * Harriet May, president/CEO, GECU, El Paso, Texas, District 5, Class C. May is currently CUNA's chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. The others elected will take office Feb. 28 and serve a three-year term that expires at the adjournment of the 2014 CUNA Annual General Meeting.

WOCCUs Kuehn named to Co-op Hall of Fame

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MADISON, Wis. (10/25/10)--Stanley Kuehn, who heads World Council of Credit Unions’ (WOCCU) development program in Ethiopia, and his wife, Gloria, have been named to the National Cooperative Business Association's (NCBA) Cooperative Hall of Fame. The Kuehns will be formally inducted at the annual Hall of Fame Dinner and Induction Ceremony on May 4 at the National Press Club in Washington, D.C. Dan Mica, former Credit Union National Association president/CEO, also will be inducted during the ceremony.
Click to view larger image The World Council of Credit Union’s Stanley Kuehn and his wife, Gloria, pictured above in Kenya, will soon be inducted into the National Cooperative Business Association’s Cooperative Hall of Fame. They have worked in international agricultural development with small farmers for more than 25 years. (Photo provided by World Council of Credit Unions)
“We are very proud of Stanley and Gloria and our former colleague Dan Mica and pleased that NCBA has recognized their lifetime of achievements,” said Pete Crear, WOCCU president/CEO. “Their accomplishments tell a story of an ongoing commitment to the betterment of humankind, a commitment we know will continue at WOCCU.” Working as a family “team” of cooperative developers, the Kuehns have more than 25 years of experience working in Latin America with small farmers to grow non-traditional and organic crops to meet new and growing markets. They worked in El Salvador and Nicaragua during Stanley's tenure as country director in NCBA’s international development program and often faced civil unrest, the threat of terrorism and war in order to complete their work. Since joining WOCCU in June 2009, Stanley has supported agricultural development in Kenya through the country's savings and credit cooperatives (SACCOs). In May 2010, he was named WOCCU's country representative in Ethiopia and project director for “Enhancing Food Security and Rural Livelihoods in Ethiopia through Agricultural and Credit Union Development,” a program supported by funds earned through the monetization of wheat provided by the United States Department of Agriculture (USDA). The new assignment further demonstrates his belief in the cooperative model. “Co-ops provided an organized and structured platform with members in position to provide valuable services to its base,” Kuehn was quoted as saying in a 1992 interview for the publication Co-ops in Crisis Countries. “Their staff can be immediately trained to provide much-needed food, technical assistance and training to members and surrounding communities.” Mica, who retired in July, had been at CUNA's helm since 1996. During his 14-year tenure, the former congressman led a number of hard-fought legal and regulatory initiatives that helped raise credit unions' visibility and respect not only in Washington, D.C., but on the consumer front as well. Joining the Kuehns and Mica for induction will be civil rights movement pioneer Shirley Sherrod, appointed as the Georgia state director of USDA Rural Development by the Obama Administration in 2009, and cooperative pioneer Noel Estenson, retired CEO of CENEX.

SECU mortgage assistance programs reduce foreclosures

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RALEIGH, N.C. (10/22/10)--Six one hundredths of one percent--.06%--is a low number that is making a big difference for State Employees’ Credit Union (SECU) members as it represents the minimal increase SECU has experienced in the number of foreclosures compared to total mortgage loans over the past five years. Even as the economy in North Carolina and the country continues to suffer, SECU has managed to keep member foreclosures low due to its member-friendly Mortgage Assistance Program (MAP) – an initiative that has already helped over 7,000 North Carolina families remain in their homes. Implemented in early 2009, MAP was created to assist members facing job loss or a reduction in work hours, by providing foreclosure prevention options which include mortgage extensions, modifications, refinances and partial payment alternatives. Budgeting, financial counseling and overall debt restructuring are also included as part of the comprehensive MAP initiative. Proof of the program’s success was noted at year-end 2009, when just 179 SECU foreclosures were filed for the year out of 121,625 loans in the SECU mortgage portfolio. The overall SECU foreclosure ratio is less than two-tenths of one percent of mortgages outstanding. SECU reports that the low foreclosure trend at SECU continues in 2010, as staff members remain committed to helping members develop workout plans for any delinquent mortgages. Spencer Scarboro, senior vice president of mortgage lending, said, “…Bad things do happen to good people! That’s why SECU is committed to exhausting every possible option to keep members in their homes and foreclosures at a minimum. It is the right thing to do for the member--prudent and compassionate--and the financially responsible course for their credit union cooperative.”

Families take refuge in CUs during economy

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PEWAUKEE, Wis. (10/22/10)--Because of their unique member-ownership structure, credit unions have provided Wisconsin consumers a critical safety net in 2010, said the Wisconsin Credit Union League (WCUL) in a press release marking International Credit Union (ICU) Week. Helping consumers stay afloat and also improve their financial position are objectives of credit unions’ REAL Solutions initiative that helps consumers without regard for profit, the release noted. During the year, credit unions have:
* Reconfigured loan terms to help families affected by job losses or health problems make ends meet * Consolidated debt at lower rates for consumers when other lenders applied massive rate hikes * Sorted out complex financial challenges to help members create or manage a budget * Provided free financial counseling or refinancing to prevent home foreclosures * Rescued consumers from payday loan traps that had overwhelmed them * Granted small loans of $500 or less at modest interest rates * Improved or preserved members’ creditworthiness with a variety of special programs and services * Conducted free financial seminars for members, schools and community groups * Made loans to small businesses to preserve jobs and fill the void for available business credit.
Prioritizing people over profits is the fourth of five WCUL press releases celebrating credit union contributions during ICU Week.

Ohio league board elected by acclamation

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COLUMBUS, Ohio (10/22/10)--Only one nomination was received for each of the five positions on the Ohio Credit Union League’s board of directors up for election. As a result, no elections were held and the individuals were elected by general consent or acclamation (eLumination Oct. 20). The directors include:
* District I--Barry Shaner, Directions CU, Sylvania; * District II-- Phil Meyer, Ohio University CU, Athens; * District III--Robin Thomas, Taleris CU, Cleveland; * Membership Category A--Jennifer Ferguson, Bay Area CU, Oregon; and * Membership Category C--Steve Behler, Kemba CU, West Chester.
All are current league directors and will serve three-year terms that expire in 2014.

ICU Day webcast outlines heritage

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WASHINGTON (10/22/10)--Given the challenges facing the world this year, credit unions are more important than ever, Credit Union National Association (CUNA) President/CEO Bill Cheney said during Thursday’s International Credit Union (ICU) Day webcast, co-sponsored by U.S. Credit Union Development Educators and the World Council of Credit Unions (WOCCU).
Click to view larger image This year's panel during Thursday's International Credit Union (ICU) Day webcast, co-sponsored by U.S. Credit Union Development Educators and World Council of Credit Unions (WOCCU) included, from left, moderator Paul Berry, the voice of the Credit Union National Association's (CUNA) Home and Family Finance Radio; Pete Crear, WOCCU president/CEO; Bill Cheney, CUNA President/CEO; Mark Meyer, CEO of the Filene Research Institute; and Paul Hazen, president/CEO of the National Cooperative Business Association. (Photo provided by CUNA)
Credit union contributions to members and communities worldwide, through good times and bad, were the focus of this year’s webcast. “It doesn’t matter where you go around the world, the ‘people helping people’ philosophy, the cooperative structure, and the one person, one vote [of credit unions] remain constant,” Cheney said. “Overall, the U.S. credit union movement remains healthy. Credit unions continue to take care of their members. In most of the country, people still are struggling, but credit unions have persevered and are doing everything they can to help their members.” A panel of credit union and cooperative industry dignitaries gathered this year at the Credit Union House on Washington, D.C.'s Capitol Hill to discuss their collective member service heritage. This year’s panel included Cheney; Paul Hazen, president/CEO of the National Cooperative Business Association; Mark Meyer, CEO of the Filene Research Institute, and Pete Crear, president/CEO of the World Council of Credit Unions (WOCCU). As in past years, the program was moderated by Paul Berry, the voice of CUNA's Home and Family Finance Radio. Cooperatives worldwide have stepped up in time of need, Crear said. “When there are national disasters, cooperatives--nonprofits--are the ones that get it done,” he said. “When the lights go back on in Haiti, cooperatives will be there. The common currency we have is people working together.” The panel agreed that credit unions have a vital role in helping to build business in the U.S. Cheney was asked how that role can be increased. “Credit unions are critical to businesses in this country, “Cheney said. “We’re working hard in Washington to allow credit unions to do more. We’re working to get additional sources of capital for credit unions. “Credit unions have distinguished themselves in this financial crisis because, as banks have pulled back from lending, credit unions are doing more,” he added. ICU Day has been celebrated annually on the third Thursday of October since 1948. The event provides a time and opportunity to honor those who have made great contributions to the global financial cooperative movement, to recognize the hard work of staff and volunteer board members working on behalf of credit unions and cooperatives today, and to express appreciation to members of credit unions and cooperatives living at home and abroad. This year's theme--"Local. Trusted. Serving You."--recognizes credit unions' identity as member-owned financial cooperatives and celebrates the trust members worldwide have in their credit unions. To view the webcast, go to WOCCU’s website.

Illinois CUs recognized for small-dollar loan products

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NAPERVILLE, Ill. (10/22/10)--Seven Illinois credit unions statewide were recently recognized in a paper released by the Illinois Asset Building Group (IABG) that builds a business case for mainstream financial institutions to offer responsible, affordable, small-dollar loan products as alternatives to payday loan products. The products can help lower wealth families struggling to make ends meet, creating a “win-win” situation for both consumers and financial institutions, according to the IABG. Current financial market conditions--which include an emphasis on protecting consumers and providing innovative products for the underbanked--have created an opportunity for financial institutions to create, implement and market alternative small-dollar loan products, said the IABG. The Illinois credit unions and their products highlighted in the report include:
* Blackhawk Area CU (BACU), Savanna, which has offered the PayDay Loan product since April 2006. The maximum PayDay Loan product amount that a borrower can request is 50% of the most recent payroll deposit, with a minimum of $100, and a maximum of $1,000. There is a repayment term of 60 days by payroll deduction. BACU also offers a Credit Builder loan for members who may not qualify for any other type of loan and wish to establish a credit history or to improve their credit score. * CEFCU, Peoria, which has provided a Quick Advance Loan since 2007 to help its members with their need for short-term credit. Loan amounts range from $50 to a maximum of $500 and have an 18% annual percentage rate with no fees. The borrower is often someone who would benefit from financial skill building. CEFCU also offers free financial counseling to members. * Central Illinois CU, Champaign, which began the Payday Alternative Loan in July 2005 for its members to help them establish positive credit and build a savings habit while providing an alternative to high-cost credit. The portfolio balance started at $5,000, and by the end of 2009 increased to $50,000. * Generations CU, Rockford, which has provided the Qwik Cash Loan to its members since 2007. The maximum loan amount for the loan is $500 at a fixed annual percentage rate of 18% for a maximum loan term of six months. The $50 origination fee is deducted from the loan amount. The Qwik Cash Loan is open-ended to allow the borrower to take one out even if there’s already an existing Qwik Cash Loan. * Illinois Community CU, DeKalb, which offers its Payday Alternative Loan product as an unsecured, revolving line of credit up to $1,000 with a 22.9% annual percentage rate and a $10 loan advance fee. The credit union requests the borrower’s credit history, but does not require any certain score. The default rate on the product is about 12.5% and the return on investment is about 15.4%. The credit union also provides a free book on budgeting and savings for members having difficulty repaying their loan obligation. * North Side Community FCU, Chicago, which recognized the preponderance of predatory payday lenders in its community and the impact high interest debt had on its members, decided in 2002 to develop its Payday Alternative Loan (PAL) program. In the past eight years, North Side CFCU has made over 5,600 PALs, disbursed over $2.5 million in PAL loans, and has saved community residents over $5 million in fees and interest from traditional payday loans. Loans in the PAL program are $500, repaid during a six-month term, and have an annual percentage rate of 16.5%. There is also a $30 application fee and a $10 late fee. Also, $75 is frozen in the borrower’s account until the loan is paid off. * Southern Illinois Area CU, Swansea, which in March 2008, launched its Cash-Aid Loan program, designed to give credit union members an alternative to high-cost credit and to help them build good credit. While using the loan product, a member also is expected to learn about finances and savings. The credit union aims to balance between making the process quick and easy and keeping risk at a minimum. The maximum amount for the Cash-Aid Loan is $300 with a 15% fixed-interest rate and a $20 processing fee, paid when the loan application is submitted.
The IABG’s “Building the Business Case” paper outlines the benefits to financial institutions in responsibly meeting consumers’ needs for short-term, small dollar credit. The benefits include increasing revenue, attracting and retaining customers, cross-selling financial products, building a positive community image, and leveraging existing relationships and infrastructure. Using case studies, the paper documents financial institutions’ experiences with providing these products and recommends ways to increase their supply from mainstream financial institutions. The IAGB is a statewide coalition invested in building the stability and strength of Illinois communities through increased asset ownership and asset protection. The Sargent Shriver National Center on Poverty Law, Chicago Appleseed Fund for Justice and Heartland Alliance for Human Needs and Human Rights contributed to the report.

Corporate realignment task force expands to eight states

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ONTARIO, Calif. (10/22/10)—The Corporate Realignment Task Force established by several Western states has expanded to 12 individuals from eight states, according to the California and Nevada Credit Union Leagues. Newly appointed members of the task force include:
* Shane Berger, CEO of Beehive FCU, Rexburg, Idaho; * Mandy Jones, CEO of Oregon Community CU, Eugene, Ore.; * Joan Opp, CEO of Stanford FCU, Palo Alto, Calif.; * Ken Payne, CEO of Freedom CU, Provo, Utah; and * Robert Ramirez, CEO of Vantage West U, Tucson, Ariz.
They join seven others already on the task force, including:
* Jeff York, chairman, CEO of CoastHills FCU, Lompoc, Calif.; * Ariel Chun, retired CEO of University of Hawaii FCU, Honolulu, Hawaii; * Rudy Hanley, CEO of SchoolsFirst FCU, Santa Ana, Calif.; * Brett Martinez, CEO of Redwood CU, Santa Rosa, Calif.; * Frank Michael, CEO of Allied CU, Stockton, Calif.; * Gary Oakland, CEO of Boeing Employees CU, Tukwila, Wash.; and * Wayne Tew, CEO of Clark County CU, Las Vegas, Nev.
The task force has adopted three guiding principles: (1) an enduring system solution is tantamount; (2) aggregation--rather than system fragmentation--is needed and should occur; and (3) there must be a universal solution that works and is affordable for all types and sizes of credit unions. A guiding principles position paper is available; use the link. The task force is a volunteer group of credit union leaders dedicated to determining what related services credit unions need and will support, and creating a sound, cooperative system to provide those essential continuing services. These services include: item processing; payment system and settlement services; short-term liquidity associated with the settlement process; and possibly investment advice and other related permissible services. Staff support for the task force is being provided initially by California and Nevada Credit Union Leagues with Richard M. Johnson, retired CEO of WesCorp FCU, serving as a consultant. The task force also is consulting with professional staff at Western Bridge FCU, SunCorp, and other system organizations as organizational efforts proceed.

Fannie Mae sues insurers in CU Mortgage scam

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WASHINGTON (10/22/10)--Fannie Mae has sued nine insurance companies, claiming they are responsible for losses on $131 million Fannie Mae paid for fraudulent credit union mortgage loans from U.S. Mortgage Corp. and its subsidiary Credit Union National Mortgage. The suit, filed Wednesday in a U.S. District Court for the District of Columbia, names as defendants: Great American Financial Resources Inc., the Travelers Cos., Chubb Group of Insurance Cos., Lloyd’s of London, CNA Insurance Co., HCC Insurance Holdings Inc.’s Professional Indemnity Agency, Zurich North America, Liberty Mutual Group and Fidelity & Deposit Co. of Maryland (Bloomberg BusinessWeek Oct. 20). The suit complained that under Financial Institution Bonds sold by the insurers, the insurers are responsible for the losses. The company faces $108 million in exposure, said the suit. The former president of U.S. Mortgage Corp., Michael J. McGrath Jr., pleaded guilty in June to one count of mail and wire fraud and one count of money laundering conspiracy stemming from the fraudulent sales of hundreds of mortgage loans to Fannie Mae without authorization and without paying the credit unions for the sales (News Now Aug. 12). McGrath admitted to conspiring with others from January 2004 to January 2009 to fraudulently sell credit union loans and use the proceeds to finance U.S. Mortgage's operations and investments for himself and his company. He also admitted to diverting funds that should have been paid to credit unions for mortgage loans sold without authorization to Fannie Mae to help offset bad investments in mortgage-backed securities (Reuters June 11, 2009). Both U.S. Mortgage and Credit Union National Mortgage, which were based in Pine Brook, N.J., filed for Chapter 11 bankruptcy during February 2009 in Newark. They listed more than $200 million in debts to Fannie Mae and the 28 credit unions. The bankruptcies have led to several lawsuits by credit unions seeking to recoup losses against Fannie Mae and against insurance companies.

Happy International CU Day

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WASHINGTON and MADISON, Wis. (10/21/10)--It’s finally here--the day in which credit unions take note of what they do and celebrate--while honoring those who have made contributions to the global financial cooperative movement. International Credit Union Day, traditionally the third Thursday of October since 1948, has a theme this year of “Local. Trusted. Serving You.” Credit Union National Association President/CEO Bill Cheney, in extending best wishes to the national movement, noted that this year’s theme “perfectly captures what makes credit unions so appealing to consumers across the nation and around the globe. “Here in the U.S., the 90-million-plus Americans who are credit union members have an advantage over all other consumers in our nation: They experience, first-hand, the benefits of receiving financial services from member-owned, cooperative financial institutions--which practice a philosophy of putting people before products,” Cheney said. “In fact, in doing so, they and their families realize substantial, direct financial benefits: More than $7.5 billion this year alone from favorable rates and lower fees as a result of using credit unions rather than other financial institutions. That breaks down to an average of $84 for each credit union member or $159 for each member household. Because credit unions are member-owed, this savings stays right in local communities,” he added. “It is no wonder, then, that survey after survey shows consumers trust credit unions to look out for their best interests more than any other type of financial institution. Our goal, as committed credit union supporters, should be to ensure that ALL Americans have the opportunity to realize these benefits through a simple, effective path to membership,” he said. A webcast at Credit Union House in Washington, D.C., today will feature a panel gathered to discuss their collective member service heritage. Cheney and Pete Crear, president/CEO of World Council of Credit Unions, will head today’s webcast. Also, participating in the panel, moderated by Paul Berry, the voice of CUNA’s Home and Family Finance Radio, will be Paul Hazen, president/CEO of the National Cooperative Business Association; and Mark Meyer CEO of the Filene Research Institute. The webcast, which will run from 3 p.m. to 4 p.m. ET, is open to the public and will allow time at the end of the discussion for panelists to respond to question submitted from the online audience. Use the link to access the program, which will also be recorded and available for viewing on WOCCU’s website after the broadcast.

Southeasts member capital not impacted by Sept. OTTI

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TALLAHASSEE, Fla. (10/21/10)--Membership capital at Southeast Capital FCU will not be impacted by an $873,063 additional other than temporary impairments (OTTI) recorded in September, announced the corporate Wednesday. With the additional OTTI from September, Southeast’s year-to-date earnings total $321,902. The corporate’s September financials are located on its website. They detail that Southeast recorded $53,102 in earnings in September, and then recorded the $873,063 OTTI, resulting in a net loss for the month of $819,961. Retained earnings were sufficient to cover the OTTI, the corporate said in a member bulletin. Year-to-date, Southeast’s OTTI totals $1.7 million, including OTTI the corporate recorded in June and in September. “Continuing to improve operating efficiencies is helping to build our retained earnings, which serve as first loss protection for membership capital, which totaled $58.7 million as of Sept. 30,” said Southeast President/CEO Brad Miller. “Going forward, our goal is to continue to improve earnings and efficiencies while providing transparency in our financial position,” he said. “The timing and amount of any future losses coupled with adherence to the new corporate rule will ultimately determine the impact to retained earnings and membership capital,” he said.

Media Traditional free checking is ending

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NEW YORK and CHICAGO (10/21/10)--Free checking is on the demise in big banks, with at least one source suggesting that smaller Main Street banks and credit unions can prepare for the opening to attract more member/customers. “The days when you could walk into a bank branch and open an account with no charges and no strings attached appear to be over,” reported the Associated Press in a widely disseminated story, “Say Goodbye to traditional free checking” (via “Yahoo! News” Oct. 19). The article noted that Bank of America is charging $8.95 a month for banking with a teller and receiving a paper statement. Twelve percent of BofA’s revenues is made through fees. Tuesday the bank announced a major shift in how it addresses consumer business. Free checking will be nearly unheard of, largely because of the number of regulations hitting banks’ bottom lines, including new laws on high-risk trades, are squeezing banks’ bottom lines, the article said. Free checking rose steadily in recent years before dropping this year, according to Moebs Services, a Chicago-based economic research firm. Last year 81.5% of banking customers had free checking. That dropped to 72.5% this year. Moebs Services founder Michael Moebs said it is now up to smaller Main Street banks to use the opening and grab customers from big banks. Free checking could become a mainstay of community banks and credit unions in the future, he said. To read the full article, use the link.

NCUF celebrates 30 years of investing in CUs

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MADISON, Wis. (10/21/10)--The National Credit Union Foundation (NCUF) is celebrating 30 years of serving as the charitable arm of America’s credit union movement. The foundation has awarded more than $25 million in grants since October 1980 to further its mission of promoting and improving consumer financial independence through credit unions. Originally incorporated as the CUNA Foundation, the organization initially focused on international development and scholarships and grants to small credit unions. In 1991, it reorganized as a charitable foundation aimed at supporting credit unions’ unique ability to meet consumer needs. Its current name was adopted in 1998 to reflect its national focus. Current NCUF programs and grants help credit unions provide financial education, expand access to affordable financial services and empower consumers to save, build assets and own homes. Foundation programs and grants include:
* REAL Solutions, which helps credit unions offer services with proven success in meeting the needs of people of modest means; * Credit union Development Education (DE) to provide training in credit union philosophy and cooperative principles; * Financial education through sponsorship of the award-winning BizKids financial education series that airs on Public Broadcasting Service stations; * CUAid, which raises disaster relief funds for credit union employees, volunteers and members through an online site and other efforts; and * Innovation Grants to encourage creative approaches to credit union operations.
NCUF is supported by credit unions participating in the Community Investment Fund, corporate supporters, individual donors, state credit union leagues and foundations, the Credit Union National Association (CUNA), CUNA Mutual Group and the Corporate Credit Union Network.

Study CUs more savvy with branch technology than banks

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NEW YORK (10/21/10)--Credit unions are considerably more advanced than banks when technology investments in branch infrastructure are compared ( Oct. 16). According to a recent study by Celent, New York, credit unions top banks because:
* 34% more credit unions than banks use teller cash dispensers, while 8% more use more teller cash recyclers; * 25% more employ automated account opening systems * 23% more have automated loan origination systems; * 23% more use image ATMs; and * 20% more use in-branch self-service technology.
The Celent report, Branch Banking in a Multichannel World: What Ever Happened to the “Branch of the Future?” put banks ahead of credit unions only in the use of customer relationship management (CRM) systems. Overall, less than a third of financial institutions participating in the survey, or 28%, had operational CRM systems and 23% had analytic CRM. In addition, 29% of all financial institutions had automated, paperless systems for account opening. One in four financial institutions used teller cash recycling, while only one in five had automated loan origination systems.

CUs make Wisconsin consumers more money savvy

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PEWAUKEE, Wis. (10/21/10)--Wisconsin credit unions look out for members’ long-term financial health by promoting thrift, according to the Wisconsin Credit Union League (WCUL). WCUL highlighted activities around the state that reflect Wisconsin credit unions’ commitment to promoting positive savings habits and wise borrowing, including:
* 109 youth-run branches, where students in elementary grades through high school have saved $2 million; * Free learning materials and online resources for public high schools; * Financial counseling and classes that help members learn to make ends meet; * Training for teachers through the National Institute for Financial and Economic Literacy; * Free presentations and workshops on credit reports, home buying and other financial topics for schools and community organizations; * Educational events, such as “reality simulations” and workshops in money management, to teach students the cost of living; and * Savings programs to encourage young people to save, with 3,800 young people in Wisconsin depositing $385,339, or about $101 per saver, during National Credit Union Youth Week in April 2010.
Thrift was highlighted in the third of five WCUL press releases celebrating credit union contributions during International Credit Union Week this week.

CUNA chief economist addresses Conn. Economic Forum

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MERIDEN, Conn. (10/21/10)--Bill Hampel, chief economist for the Credit Union National Association (CUNA), addressed more than 100 Connecticut credit union executives, board members and officers about current economic conditions at the Economic Forum hosted by the Credit Union League of Connecticut in Plantsville, Conn.
Click to view larger image Tony Emerson, president /CEO of the Credit Union League of Connecticut (left), listens to a point made by Bill Hampel, chief economist at the Credit Union National Association, following Hampel’s presentation on the economy for Connecticut credit union officials at the league’s Economic Forum in Plantsville, Conn. (Photo provided by the Credit Union League of Connecticut)
Although Hampel pointed out the factors driving the unpredictable economy, he said the recession was over, conditions are on the mend, and “the long-term outlook is modest.” He predicted moderate savings and asset growth going forward for credit unions. However, interest rates will remain low along with continued weak loan growth. “People are saving a lot more than they used to, using disposable income mostly to pay down debt,” Hampel said. In fact, the forecast into 2011 is for a marked decline in loans, the first time CUNA economists have predicted such for future credit union performance, Hampel added. Following the discussion, three officials from the National Credit Union Administration--currently overseeing operations at Constitution Corporate FCU, Wallingford, Conn., now in conservatorship--provided a status update and outlook for the corporate’s future, and took questions.

Third candidate in contested CUNA board election

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MADISON, Wis. (10/21/10)--A third candidate nomination has been received for a contested seat on the Credit Union National Association (CUNA) board of directors. The most recent nomination was for Dennis A. Fisher, president/CEO of First Security CU, Lincolnwood, Ill., for the District 4, Class A seat. His nomination brings the total nominations to 11 for board seats. Fisher will be running against Brian Smith-Vandergriff, board member of Catholic Family CU, Kansas City, Mo., and Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, for the District 4, Class A seat. So far, that’s the only contested race in the elections. The deadline for nominations is Friday. Voting will take place from Oct. 27 through Dec. 17. Nominations also have been received for:
* Jeff York, president/CEO of CoastHills FCU, Lompoc, Calif., District 6, Class B seat; * Stephen G. Behler, president/CEO of Kemba CU, West Chester, Ohio, District 2, Class B seat; * Brett Martinez, president/CEO, Redwoods CU, Santa Rosa, Calif., running for a District 6, Class C seat in a special election; * Harriet May, president/CEO, GECU, El Paso, Texas, District 5, Class C. May is currently CUNA's chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. The others elected will take office Feb. 28 and serve a three-year term that expires at the adjournment of the 2014 CUNA Annual General Meeting.

HELOC scam tapped 220000 from members equity

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PHILADELPHIA, Pa. (10/20/10)--A lawsuit over coverage of $220,000 of home equity line of credit (HELOC) funds that went missing from a credit union member’s account has provided some details on the methods used by international fraudsters in a dozen similar cases in the eastern section of the country. According to the Sb1 FCU, Philadelphia, Pa., in its suit against its bond insurer, identity thieves tapped into a member’s HELOC account and stole private information to use later to convince the credit union to wire $220,000 from the member’s account to an account in Hong Kong. The unidentified member provided his address, Social Security number, telephone number, date of birth and other personal identifying information, as well as an example of his signature, to the credit union when he joined it on Aug. 31, 1999, said court documents. On Feb. 26, 2008, he opened a HELOC and used his line of credit through electronic transfers. As of January, 2010, his credit line was $345,000, of which $222,000 remained available to borrow. On Jan. 13, the credit union’s call center received a call from a person identifying himself as the member, and after providing accurate responses to security questions, the caller succeeded in getting the member’s telephone number changed on his membership file, said the suit filed. On Jan. 14, a person purporting to be the member requested that $220,000 be accessed from his credit line and deposited into his checking account. The credit union required a wire transfer request and free agreement form, which provided the correct member identification number, account number, an e-mail address indicative of his spouse’s account, and a signature matching the signature on file. The request was also accompanied by a copy of the member’s passport with a signature, also matching the one on file. A representative of the credit union twice called the telephone number of record to confirm the instructions and both times the request was verified, Sb1 FCU said in its complaint. On Jan. 21, the member discovered the unauthorized access and the credit union immediately tried to recover the funds with a wire transfer recall and retention of counsel in Hong Kong, the document said. On April 28, the bond insurer, CUMIS Insurance Society, denied the credit union’s claim, saying the credit union did not perform a proper callback verification and there was no commercially reasonable security procedure set forth in a written funds transfer agreement signed by the member” that “governed the transaction or instruction.”

U.S. Central auditors records subpoenaed

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BIRMINGHAM, Ala. (10/20/10)--Corporate America CU has subpoenaed all the records of BDO Seidman, the auditor of U.S. Central FCU, in its suit against the officers and directors of U.S. Central. According to court documents, the subpoena on behalf of the Birmingham, Ala.-based Corporate America asks for all work papers, correspondence, research, spreadsheets, drafts and investment valuations provided by the Las Vegas-based auditing firm for the Lenexa, Kan.-based U.S. Central in 2008. Other organizations receiving subpoenas in the case are Riskspan, Vienna, Va.; Callahan & Associates, Washington, D.C.; Clayton Financial Services, Topeka, Kan.; and Pacific Investment Management Co. (PIMCO), Newport Beach, Calif.; and Andrew Davidson and Co., New York. The suit claims that Corporate America CU and 26 other corporate credit unions that were members of U.S. Central were misled when U.S. Central converted $450 million of temporary capital to permanent capital just before the nation’s financial crisis erased all of the capital during the fall of 2008.

Wisconsin banks trim branches CUs branches sprout

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MILWAUKEE (10/20/10)--The economic downturn and changing transaction patterns are trimming the number of Wisconsin bank branches, even as credit union branches continue to grow. Federal Deposit Insurance Corp. (FDIC) data show bank branches in Wisconsin decreased by 37 to 2,351 branches as of June 30, 2010 (Marketplace Magazine Oct. 17). Nationally, there were 98,505 bank branches in 2010, down from 99,540 in 2009. Expert observers said banks eliminated branches to reduce costs and preserve capital. Shifting transaction activity was also a factor. While consumers still enter branches to open accounts, they increasingly use online banking and other options for transactions such as check cashing and withdrawals, prompting a 35% to 50% decrease in these transactions inside branches. As not-for-profit cooperatives, credit unions have generally been able to remain healthy despite the economic downturn, allowing them to preserve their branch networks, the magazine said. The Wisconsin Credit Union League said state credit unions operated 670 branches in June, a gain of 10 branches since 2009. Nationally, credit union branches increased from 21,341 in 2009 to 21,477 in 2010. In some cases, Wisconsin credit unions acquired new branches from banks that were retrenching. Earlier this year, AnchorBank sold 11 branches in northwestern Wisconsin to Royal CU, Eau Claire. UW CU, Madison, bought a branch property from Amcore Bank in Milwaukee shortly before that bank failed and bought a Waukesha branch from Equitable Bank.

One-third of consumers using online banking

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WESTLAKE VILLAGE, Calif. (10/20/10)--More than one-third of American consumers use online banking services offered by their credit union or bank to manage their finances, according to the Third Annual Intuit Financial Services Online Financial Management Survey. The survey by Intuit, a CUNA Strategic Services provider, also showed that online banking is a competitive differentiator. Among all survey respondents, 52% said they would leave their current financial institution for another that offered better money management capabilities. In addition, nearly half said they had recently switched banks or credit unions, with one-third of them making the change because their financial institution lacked satisfactory online banking. Among online banking users, the survey reported that:
* 84% said the most important feature is the ability to pay bills and manage all financial tasks in one place; * Almost half expressed an interest in using tax preparation tools offered by their financial institution website; and * Approximately one in five banking customers are also current users of mobile banking solutions.
Slightly over one-quarter of survey respondents have reduced their visits to their local branch to once per month. The Intuit survey also found that half of Americans surveyed still rely primarily on spreadsheets and checkbook registers to manage their finances.

Government drops its appeal on Bellco UBIT case

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DENVER and WASHINGTON (10/20/10)--The U.S. Department of Justice has abandoned its plans to appeal a federal judge’s favorable credit union ruling related to Bellco CU’s challenge of the Internal Revenue Service’s (IRS) policy toward unrelated business income tax (UBIT) and its application to credit unions. “We consider this fantastic news because it means that the government did not see enough merit in its own position to push it further in the courts,” said Credit Union National Association (CUNA) President/CEO Bill Cheney. “Now we will be solidifying a strategy that will, we hope, put the UBIT issue to rest with the IRS and others for a long time to come.” The government had filed a notice of intent to appeal this summer after Judge Christine M. Arguello ruled in November 2009 that investment and insurance products that Bellco sold to its members, including credit life and disability insurance and some other products, stocks, bonds, mutual funds and annuities, were "substantially related" to Bellco's tax-exempt purposes, and therefore the income from those activities was, under the law, exempt from UBIT. What this most recent action in the Bellco case means to the credit union is that the IRS must honor its agreement to pay the full tax refund of $199,293 sought by the credit union on three of its products. The UBIT Steering Committee, comprised of CUNA, the American Association of Credit Union Leagues, the National Association of State Credit Union Supervisors, and CUNA Mutual Group, while not giving tax advice, has suggested that the Bellco case may be helpful to state-chartered credit unions' legal, tax, and accounting professionals in determining whether the decision constitutes "substantial authority" for their credit union to not pay, or to seek a refund of, UBIT paid on income from sales of brokerage or annuities products.

CUNAVerse blogs its way to growth after six months

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MADISON, Wis. (10/20/10)--CUNAVerse, the official blog site of the Credit Union National Association (CUNA), was accessed 32,701 times by 15,849 individual computers or cell phones since it was launched on May 3, 2010. As the blog written by CUNA staff approaches its six-month anniversary, it continues to combine insights on credit union issues with behind-the-scenes glimpses of operations at CUNA, according to Joshua Jones, CUNA manager of new media & communications. The blog currently offers 74 posts on 21 topics, drawing 319 comments from blog followers. Popular topics include compliance, credit union history/philosophy, marketing, operations, personal finance education, conferences and training. The top five posts accessed by readers so far are:
* “Components of a credit union social media plan”; * “What credit unions can learn from Pizza Hut”; * “Worried that CUs aren’t focused enough on upcoming truth in lending changes”; * “Turnover increase on the horizon for credit unions”; and * “A culture of fear or a culture of love.”

Students call shots at 109 Wis. school CU branches

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PEWAUKEE, Wis. (10/20/10)--Students from elementary grades through high school are learning money management skills by operating 109 credit union branches inside Wisconsin schools, said the Wisconsin Credit Union League. Youth-run branches account for 16% of the offices operated by the state’s 230 credit unions. More than 5,600 young savers have stashed more than $2 million in deposit accounts, or an average of $357 per student. “The youth-run credit union phenomenon has swept our state for two reasons,” says Brett Thompson, league president/CEO. “Young people are more committed than ever to volunteerism and want to use their talents in ways that also benefit their communities. Second, teachers know that credit unions’ motivation is in people, not profit-making, so they have parlayed their trust in credit unions as a best practice for schools statewide.” The state Department of Public Instruction has defined competencies for personal finance that students should acquire by grades 4, 8 and 12. Schools with limited resources have used credit union support to advance their own financial education efforts at no additional costs to taxpayers. Because the branches focus primarily on saving, not lending, they don’t drive profits for credit unions. Instead, they’re offered as an investment in youth and the community, the league said. The money the students save comes from allowances or part-time jobs. Some youth branches make small loans to teach responsible use of credit. And most provide students free financial education, either through the branch or in class. All youth-run branches are adult supervised and state-regulated. Student volunteers run the branches to learn leadership skills as well as good financial habits. Some go on to paid employment with credit unions. Development of youth run-branches earned Wisconsin credit unions a 2009 Governor’s Financial Literacy Award. The trend typifies credit unions’ REAL Solutions initiative, which serves members and communities without regard for profit. “REAL” stands for “Relevant, Effective, Asset-building, Loyalty-producing” Solutions. The program works through state credit union leagues to help credit unions offer services for people of modest means and “low wealth.”

International CU Day activities have begun

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MADISON, Wis. (10/20/10)--Many activities related to International Credit Union (ICU) Day, to be celebrated Thursday, have begun, including governors’ proclamations, state credit union leagues’ events and individual credit union celebrations. This year’s theme is “Local. Trusted. Serving You.” Pennsylvania Gov. Ed Rendell issued a Credit Union Day Proclamation, declaring Oct. 17-23 as Credit Union Week in the state, and Thursday as Credit Union Day in connection with the worldwide celebration of ICU Day (Life is a Highway Oct. 18). Rendell commended credit unions for “their continuing interest in the welfare and development of credit union members and for the many contributions credit unions make to the larger community.” Indiana Gov. Mitch Daniels declared Oct. 17-23 as Cooperative Week in Indiana with the support of several cooperative organizations, said the Indiana Credit Union League. Daniels said that “the cooperatives in Indiana generate significant income, employment and revenue and function as engines of economic growth for local communities and the economy of Indiana.” Daniels’ proclamation will be on display throughout the week in the Indiana Farm Bureau Building in Indianapolis, which is home to several cooperative organizations that provide financial services, insurance products, energy exploration and other services. Minnesota Gov. Tim Pawlenty signed a proclamation this week declaring Thursday as Credit Union Day in the state. It said, “Credit unions develop strong alliances that transcend political and geographical boundaries, making financial democracy possible in many countries around the world.” It goes on to proclaim, “Credit unions encourage a regular habit of saving, foster the desire to repay loans so members have access to credit when needed, and empower individuals to improve their financial standing.” More than 180 volunteers from Ohio credit unions will celebrate ICU Week by educating nearly 1,000 high school students on the importance of budgeting, saving, and differing wants from needs at financial education “reality games” in Dayton, Toledo and Columbus, said the Ohio Credit Union League (OCUL). Credit unions understand the financial health of Ohio’s youngest citizens is at risk, and are working to make financial education an important aspect of a well-rounded education, OCUL said. “International Credit Union Week is a time when we reflect on how credit unions are different, and this is a prime example of the credit union difference,” said Paul Mercer, OCUL president. “Financial education, especially key concepts like budgeting and saving, is crucial to the financial future of our youth. Credit unions’ believe it is our duty to share our financial education expertise, to help educators fulfill this need, and serve as a conduit to financial success for Ohio youth.” The Maine Credit Union League is joining with Maine’s credit unions in celebrating and highlighting the credit union difference. In his Credit-Union-Week message to the staff and officials at Maine's credit unions, league President John Murphy praised their commitment and dedication (Maine Credit Union League’s Weekly Update Oct. 15). “While many segments of the financial services sector have come under intense scrutiny for putting profits above people, credit unions have remained steadfast in focusing on doing what is in the best interests of the members and, in many cases, going above and beyond to serve members,” Murphy said. Throughout the week, most Maine credit unions are marking the occasion with special events and activities. Some credit union events and festivities to celebrate ICU Day include:
* Wright State University in Dayton, Ohio, invited about 100 students Monday to play a hands-on “game of life,” called Life After High School, created by Universal 1 CU, Dayton, and funded in part by the Ohio Credit Union Foundation. Students made important decisions during the game that impacted their financial futures: job selection, higher education, living choices, car purchases and everyday monthly expenses. The Ohio Credit Union League donated the 25 Life After High School board games used during the event to area high schools. * ICU Day is an annual tradition at Belco CU, Harrisburg, Pa., with events including a free hot dog lunch, prize drawing for a $100 Visa gift card, free giveaways and an employee bake sale at all branches, with 100% of the proceeds going to the Susan G. Komen Foundation for Breast Cancer Awareness. * Educational CU, Topeka, Kan., is asking members what they would do if they were given $20 dollars to “pay it forward.” In honor of International Credit Union week, the first 25 people who answer the question will get $20. Their intentions will be videotaped and uploaded to Facebook so the community can vote on them ( Oct. 18). * Service 1st FCU, Danville, Pa., is celebrating the grand opening of its new Corporate Center during ICU Week. Throughout the week, employees and members will volunteer their time at six local service organizations, including the Danville Child Development Center, Ronald McDonald House, Hope Enterprises, Inc., Montour Area Recreation Commission, House of Care, and the Gate House Shelter (Life is a Highway Oct. 18). * The employees of Wildfire CU, Saginaw, Mich., have chosen October as “Month of Giving Back to the Community” in conjunction with ICU Week. October is the credit union’s kick-off for United Way and the Making Strides Against Breast Cancer Walk. To raise awareness and have some fun, the employees also donated money to wear blue jeans to work in exchange for supporting United Way, among other fundraisers.

Council speaker Weak recovery means modest gains in 2011

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LAS VEGAS (10/20/10)--The U.S. housing market has likely reached the bottom of this housing cycle and is trending upward, but this third consecutive jobless recovery in U.S. history means few gains for the market or the overall economy in 2011, U.S. economist David Berson said Monday. Berson’s remarks were made in Las Vegas Tuesday at the General Session of the 2010 CUNA Lending Council Conference. Delegates from credit unions nationwide attended as he presented his “Outlook for the Economy, Housing and Mortgage Markets.” “This is the third consecutive jobless recovery,” Berson said. “Not literally jobless, but weak in comparison to recoveries before 1990, resulting in unemployment rates higher than desired, for too long.” The nature of the recovery is having a direct impact on future prospects for the housing market and overall economy, Berson said. “We are probably at the bottom of the housing cycle. Although we expect gains going forward, they’re likely to be modest, at least initially,” he added. Berson is chief economist and strategist at PMI Mortgage Insurance Co., where he is the author of PMI’s monthly Housing and Mortgage Markets Review and the quarterly Economic and Real Estate Trends. He was previously chief economist for Fannie Mae. Conference attendee CMG Mortgage Insurance Company (CMG MI) is a corporate joint venture between PMI and CUNA Mutual Group, and a provider of mortgage insurance products and services to credit unions in the U.S. “Successful residential real estate lending requires an understanding of the trends in job growth, Federal Reserve monetary policy and the direction of interest rates. David’s presentation at the CUNA Lending Council will be helpful in the decision-making process of many credit unions,” said Joe Dillon, CMG MI senior vice president and general manager. Sponsored by the Credit Union National Association, the annual CUNA Lending Council conference focuses exclusively on credit union lending sectors.

Broker convicted for phony appraisals a suicide

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DECATUR, Ill. (10/19/10)--A real estate broker who was convicted Oct. 1 of defrauding a credit union and property buyers in Decatur, Ill., with a real estate flipping scheme was found dead Friday, an apparent suicide ( Oct. 15). Terry Hart, 58, the owner of Hart Realty, had been convicted of nine counts of fraud for the scheme, which centered on phony appraisals that defrauded the $104 million asset Staley CU and real estate buyers ( Oct. 5). Hart and two others conspired to use fraudulent appraisals that prompted buyers to purchase real estate with financing from the credit union. The amounts financed were much greater than the worth of the properties, which were owned by Hart. The frauds allegedly occurred from 2002 to July 2005 and involved 40 real estate sales and financing transactions totaling more than $3 million. The frauds generated a $1 million potential loss for the credit union. Two others entered guilty pleas, also on nine counts of fraud. They are Diane Shelton, 62, former loan officer at the credit union, and Mark Brown, a former licensed real estate appraiser. Shelton and Brown are scheduled to be sentenced next month.

First Techs next step Members to vote on merger

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PALO ALTO, Calif., and BEAVERTON, Ore. (10/19/10)--Members of First Tech CU, based in Beaverton, Ore., will be voting soon on its proposed merger with Palo Alto, Calif.-based Addison Avenue FCU. The two credit unions recently received approval for the merger from the National Credit Union Administration and the State of Oregon. “This is an important milestone in the merger approval process,” said Benson Porter, Addison Avenue president/CEO, “and we look forward to finalizing the merger.” During the last week of October, First Tech members will receive a voter’s guide and information about the proposed merger. A week later, they will receive an Official Ballot Packet, and will have 30 days to cast their vote. The results of the vote will be announced in early December. First Tech members are voting because First Tech would change from a state charter to a federal charter. Brooke Van Vleet, First Tech’s interim president/CEO, noted that the combined credit union will offer “more value for our combined membership, greater efficiencies and the strength to grow and prosper in the 21st century.” Both credit unions are strong, well-capitalized credit unions and share a culture of serving members from 21st century companies such as Hewlett Packard, Microsoft, Agilent, Intel, CH2M HILL and Nike. The combined credit union will have assets of $4.6 billion, 38 branches and more than 327,000 members.

140 CU execs sign up for Southwests Advisory Council

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PLANO, Texas (10/19/10)—Roughly 140 credit union executives and volunteers from 11 states have signed up for the Southwest Corporate Advisory Council, according to the Southwest Bridge Corporate FCU’s website. The Plano, Texas-based corporate announced it was forming the council, with the help of the Texas Credit Union League, to advise it on its future and that it would develop a process to receive input from its member credit unions. The deadline to sign up was Oct. 13, and the initial meeting of the council was Friday. The timetable for appointments has not yet been established. Dianne Addington, CEO of Southwest Bridge Corporate, said the goal is to “work quickly” to present a business plan to the full membership regarding the corporate’s future (eFacts Oct. 12). In her most recent “Corporate Update” letter Oct. 12, Addington urged credit unions to maintain services with Southwest during the interim and give consideration to a new plan that will be presented by the council in the next few months. The corporate was among three placed into conservatorship on Sept. 24 by the National Credit Union Administration. The council members are mostly from Texas, but other states represented include: Arkansas, Florida, Georgia, Louisiana, New Mexico, Michigan, Missouri, Okahoma, Oregon and Washington.

Colloquium focuses on sustainability of CUs

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MADISON, Wis. (10/19/10)--How sustainable is the credit union business model? Sustainable, but with caveats, according to four experts who recently spoke at Filene Research Institute’s Credit Union Sustainability Colloquium: Evidence and Actions at Harvard University. The colloquium was made possible through collaboration among the Massachusetts, New Hampshire, and Rhode Island Credit Union Leagues, Harvard University CU in Cambridge, Mass., and Filene. Participants included 85 credit union CEOs, directors and executives from New England and from Filene’s research and innovation partner credit unions. Filene will publish a full review of the day’s proceedings and findings in early 2011. Peter Tufano, a Harvard Business School professor and a Filene Research Fellow, introduced a Harvard business case to show that growing profits and growing sales do not always make a viable business. The case study’s Butler Lumber Co. had to decide--just as credit unions do--on how to use four levers for the right mix of profit margin (lowering costs, raising revenues or both), asset turnover, leverage (using as much capital as possible), and payout (distributing funds to shareholders). If Butler Lumber gets it wrong, the company will grow its way into default. The credit union corollary: Credit unions with excess capital can manage with low profits for a long time; but without access to outside capital, the only way to grow sustainably in the long run is to pull one of those four levers. Building on Tufano’s sustainable growth theme, John Lass, senior vice president of strategy and business development at CUNA Mutual Group, led a discussion of what those levers look like at credit unions. An excellent way to do that, he said, is to look at National Credit Union Administration reports to see what a few big credit unions are doing to optimize growth. State Employees’ CU in Raleigh, N.C, wins a high return on assets (1.07%) and a better return of equity (16.37%) with a 2% (of assets) operating expense ratio and a high leverage factor-- a capital level that hovers around 7% of assets. You can fail even though nobody dislikes you, said Frances Frei, a Harvard Business School professor. Credit unions particularly must be careful about trying to be all things to all members, because a drive for across-the-board excellence is much more likely to lead to mediocre performance in all areas. Instead, it takes strategic courage to decide what your credit union will not do well--and make sure you don’t do it. If you try to be good at everything, you will run out of money long before you’ve succeeded. Not a recipe for success, Frei said. Dorian Stone, a partner at McKinsey and Co. and a Filene Research Fellow, said outsized operating expense ratios are the bane of most U.S. credit unions. A straightforward comparison of operating expenses shows U.S. credit unions lagging similarly sized banks by 20% and more. Moreover, competitors aren’t likely to get less efficient, so it’s time for credit unions to do better. Key elements for credit unions to assess include whether they are using scaled operational models, prioritizing the right performance improvements to deliver value to the member, and having the right accountability in place at each level to ensure high levels of performance, Stone added.

Maine league developing new ad campaign

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WESTBROOK, Maine (10/19/10)--The Maine Credit Union League’s Statewide Awareness Committee at a Sept. 30 meeting approved the development of new television ads for 2011. Designed to attract a younger demographic, the ads will feature an animated, three-dimensional look and will invite viewers to “Look into Maine’s Credit Unions. You’ll like what you see.” The committee also discussed new initiatives underway in the 2010 statewide campaign. As part of Maine’s Credit Unions’ financial literacy efforts, FOX ran quarterly public service announcements, featuring useful financial tips, and directed viewers to (Maine Credit Union League’s Weekly Update Oct. 15). Also, begun in August, the campaign underwrote a series of broadcasts on Maine Public Broadcasting Network (MPBN) that features films produced by independent filmmakers and producers sharing their portrayals of Maine life. The campaign will run two 15-second commercials, one at the open and close of each film. Maine’s Credit Unions were mentioned in MPBN’s EXPERIENCE Program Guide, and the league’s logo ran on promotions for the program.

ICrainsI pubs Rock solid CUs haven for small biz

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MADISON, Wis. (10/19/10)--Credit unions remain financially rock solid and well-capitalized--offering lower mortgage rates, higher interest on savings accounts and an increasing number of small-business loans, according to articles in three publications. Credit unions have been long-known as a source of consumer lending, but now have become a haven for small businesses, according to an article, titled “Business loans make up large share of credit union portfolios,” in Crain’s in Cleveland (Oct. 18). “Amid tighter bank lending standards in the wake of the subprime mortgage fiasco, credit unions are accelerating their issuance of small business loans,” the article said. “As a result, an area of business that was a specialty line for credit unions has become more mainstream,” said John Kutchey, deputy director of the examination and insurance office of the National Credit Union Administration, the industry’s federal supervisor,” the article reported. Credit unions offering business loans total 2,300 this year--30% of all U.S. credit unions, Mike Schenk, senior economist for the Credit Union National Association (CUNA), told Crain’s. In 2008, the percentage of credit unions that offered business loans was 24%, he said. The volume of business lending at Ohio credit unions grew 13.3% over the past year, Patrick Harris, director of media relations for the Ohio Credit Union League, told Crain’s. The article also mentioned Buckeye State CU, Akron; Taleris CU, Cleveland; and Vacationland FCU, with branches in Sandusky and Vermilion. In California, credit unions remain solid and well-capitalized in a state that has seen substantial areas rocked by the recession, said the Central Valley Business Journal Oct. 18. “Credit unions in … California and across the nation are strong, stable and sound,” Daniel Penrod, industry analyst with the California Credit Union League, told the Journal. “Overall loan growth remains normal in the 3% loan range.” Credit unions overall will begin to see a distinct influx of share deposits by 2011 “because consumers won’t be spending as much and will be trying to build up their savings,” Bill Hampel, CUNA chief economist, told the Journal. The publication also featured Patrick Keefe, CUNA vice president of communications and media outreach, talking about the safety and soundness of credit unions, and National Credit Union Administration Chairman Michael Fryzel, who said credit unions have been largely unaffected by economic turmoil and that they have been included in recent legislative changes that will ensure access to liquidity and asset programs. According to an article in (Oct. 18), San Francisco consumers looking for a community alternative to a large bank should check out local credit unions. “If you’d like to see what a community alternative to big banks might be like, visit your local credit union. Northern California residents are getting mortgage and banking services at their very own San Francisco FCU,” said. “Because of their independent nature, credit unions typically offer lower mortgage rates, higher interest on savings accounts, and lower service fees,” the article said.

Excellence in Lending awards announced

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LAS VEGAS (10/19/10)--CUNA Mutual Group’s Excellence in Lending Awards were presented to three credit unions at the CUNA Lending Council conference in Las Vegas. The 11th annual awards recognized:
Click to view larger image Winners of CUNA Mutual’s Excellence in Lending Awards were recognized Monday at the 16th Annual CUNA Lending Council conference in Las Vegas. Front row, from left: Jeff Lewis and Jim Craft, Oregon Community CU, Eugene, Ore., Consumer Lending, more than $250 million in assets; Carol Brinchi and Denise Kaczmareck of Erie (Pa.) FCU, Consumer Lending, more than $250 million in assets; Robert Morgan, NorthCountry FCU, South Burlington, Vt., Low/Modest Means credit unions. Back row: Dan Kaiser, vice president, CUNA Mutual Group; and Aaron Bresko, vice president, BECU, Seattle, Lending Council chairman. (Photo provided by CUNA Mutual)
* Oregon Community CU (OCCU), Eugene, Ore., for consumer lending among credit unions with more than $250 million in assets. OCCU developed “360” Training to remove “fear of sales” and teach employees to align members’ needs with products and services. The credit union also established a loan-phone branch to channel member calls to experts. By mid-2010, the loan-phone branch had achieved 137% of its annualized goal. * Erie (Pa.) FCU, for consumer lending among credit unions with more than $250 million in assets. Erie FCU followed its strategic planning blueprint for expense management, building business relationships with car dealers and growing lending and member service programs. Erie made 3,400 car loans in 2009 to become Erie County’s top vehicle lender. The credit union also expanded a Merchant Direct Loan program for small businesses to increase the program’s loan portfolio by 22.7%. * NorthCountry FCU, South Burlington, Vt., for credit unions with low/modest means. NorthCountry created the Employer Sponsored Income Advance Program so members can apply for emergency loans of up to $1,500 through their employer’s human resources department. Participating companies pay an annual fee that is usually less than $500. The credit union has made 389 emergency loans totaling $400,000 since July 2007 while writing off $8,500. More than one-third of borrowers continue payroll deductions to savings after the loan is repaid.
Excellence in Lending Awards recognize credit unions that have implemented outstanding lending programs while demonstrating sound financial performance.

Michigan governor thanks CUs for fostering entrepreneurship

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LANSING, Mich. (10/19/10)--Gov. Jennifer Granholm thanked Michigan
Greg Main, left, president/CEO of the Michigan Economic Development Corp., and Andy Levin, right, acting director of the Department of Energy, Labor and Economic Growth, listen as Michigan Gov. Jennifer Granholm discusses the state's and credit unions' efforts to improve entrepreneurship in the state. (Photo provided by the Michigan Credit Union League)
credit unions for their role in fostering small businesses and offering small business loans during a press conference that highlighted the state’s efforts to promote entrepreneurship (Michigan Monitor Oct. 18). Earlier this year, the Michigan Credit Union League worked with the Michigan Economic Development Corp. and the state’s Small Business Technology and Development Center to launch the Credit Union Business Financing Alliance. The alliance offers information on training and lenders to entrepreneurs. Press conference participants included Benjamin Cummings, who relied on credit union alliance services to get a business loan from ELGA CU in Flint, where he was already a member. The loan helped Cummings co-found Cummings Chiropractic in Lapeer, Mich., with his wife, Teresa. Cummings reported that business has been so good that the firm plans to repay its loan early.

CU System briefs (10/18/2010)

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* HIGHTSTOWN, N.J. (10/19/10)--New Jersey Credit Union League President/CEO Paul Gentile, left, had a chance to share messages about credit unions with former vice president and 2000 Democratic presidential nominee Al Gore, right, during a campaign event for U.S. Rep. Rush Holt, back center, Sunday in Rumson, N.J. Holt, a friend to credit unions, is facing a close race in the 12th Congressional District (The Daily Exchange Oct. 18). He is one of the state’s six co-sponsors of legislation to increase the credit union member business lending cap. Earlier this year, he joined two other delegation members to sign a letter to leadership encouraging the inclusion of MBL reform language in any jobs-creation legislation. (Photo provided by the New Jersey Credit Union League) … * FARMERS BRANCH, Texas (10/19/10)—Kevin Venable, business development manager of the Texas City, Texas-based AMOCO FCU, was named the Marketing and Business Development Professional of the Year, the highest honor at the Texas Credit Union League’s 2010 Marketing & Business Development Conference in San Antonio earlier this month. In his five years with AMOCO FCU, Venable assisted in the growth of tens of thousands of members and hundreds of millions of dollars in both loans and assets, said the league … * FARGO, N.D. (10/19/10)—A Fargo man was sentenced to five years and three months in prison for robbing the West Fargo branch of Minot, N.D.-based Town & Country CU on Aug. 3, 2009. Matthew C. Becker, 20, pleaded guilty in June in the U.S. District Court of North Dakota. The robber, wearing a hooded sweatshirt, sunglasses and red bandana as a mask, brandished a weapon and demanded the employees empty the cash drawers. He fled with $9,314 in cash. Becker was arrested the next day after a detective viewed surveillance camera footage of the robbery and recognized him. He also was sentenced to three years’ supervised release and ordered to pay restitution of $9,314 and a $100 special assessment to the Crime Victim’s Fund (Targeted News Service Oct. 15) …

Office manager charged with faking abduction in CU robbery

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WORCESTER, Mass. (10/18/10)--The office manager of a Worcester, Mass-based credit union that was robbed Aug. 27 and her husband are on trial for faking her abduction and stealing more than $200,000. Susan Carcieri, 59, office manager at WG FCU, Worcester, and her husband, George Labadie, 51, are charged with bank embezzlement and attempted counterfeiting and possession of counterfeiting equipment ( Oct. 15). An investigator testifying at the trial in Worcester Superior Court said investigators found $4,000 in $10 bills hidden in an exterior wall of the couple’s home two days after they allegedly staged a robbery at the credit union. Court records indicated that $20,900 in $100 bills were recovered from home. Carcieri had reported she had been a victim of a robbery. Officers found her tied to a chair in the kitchen area of the credit union. Her feet and left hand were loosely bound to the chair with cords from a window blind. Her right hand was free, according to Detective Dennis Cullina.

Contested election for CUNA board seat

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MADISON, Wis. (10/15/10)—Another nomination has been received in the District 4, Class A race for a seat on the Credit Union National Association (CUNA) Board of Directors. The nomination of Brian Smith-Vandergriff, board member of Catholic Family CU, Kansas City, Mo., brings the total nominations to 10 for board seats. Smith-Vandergriff will be running against Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU for the District 4, Class A. So far, that’s the only contested race in the elections. The deadline for nominations is Oct. 22. Voting will take place from Oct. 27 through Dec. 17. Nominations also have been received for:
* Stephen G. Behler, president/CEO of Kemba CU, West Chester, Ohio, for the District 2, Class B seat; * Jeff York, president/CEO of CoastHills FCU, Lompoc, Calif., for the District 6, Class B seat; * Brett Martinez, president/CEO, Redwoods CU, Santa Rosa, Calif., for a District 6, Class C seat in a special election; * Harriet May, president/CEO, GECU, El Paso, Texas, District 5, Class C. May is currently CUNA's chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. The others elected will take office Feb. 28 and serve a three-year term that expires at the adjournment of the 2014 CUNA Annual General Meeting.

CU System briefs (10/15/2010)

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* PHOENIX (10/18/10)--U.S. Rep. Harry Mitchell (D-Ariz.) recognized Margaret Hunnicutt, CEO of Tempe Schools CU, during an appearance at a candidate event hosted by the Arizona Credit Union League and the $138 million asset credit union. Mitchell announced that on May 20, he honored Hunnicutt by addressing the House floor to express his gratitude for her service to the credit union and to the community. She was presented with a Certificate of Congressional Record displaying the speech he made to the House floor. Mitchell also confirmed his support of credit unions and their positive role in the community during tough economic times … * GREENVILLE, Tenn. (10/18/10)--A husband and wife pleaded guilty Thursday in a federal court in Tennessee to a 10-state robbery spree involving 11 banks and credit unions. Michael Watson and Nikki S. Watson were nabbed in January 2009 after a robbery in Hattiesburg, Miss. Michael Watson asked for the case to be transferred to Tennessee because that’s where most of the robberies occurred. The robberies included those of Diamond Valley CU, Evansville, Ind., and Appalachian Community FCU, Kingsport, Tenn. Sentencing has been scheduled for Nov. 22 ( Oct. 14 and 15) …

IMarketWatchI CU industry overall healthy

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WASHINGTON (10/18/10)--The credit union industry overall is “healthy and has strong prospects,” as the National Credit Union Administration (NCUA) commences to sell off legacy assets securities from three corporate credit unions in conservatorship, according to a Thursday MarketWatch article. “NCUA Chairman Debbie Matz estimates that retail credit unions will have to pay between $7 billion and $9.2 billion into a stabilization fund to cover the losses from the wholesale credit unions,” wrote Ronald D. Orol, in an article titled “Credit unions mostly safe despite rescue: analysts.” “However, regulatory onlookers contend that it is unlikely these costs will translate into a major headache for retail credit unions, which number about 7,600, or significant new costs for their customers,” Orol added. He noted that retail credit unions were restricted from purchasing the kind of risky mortgage securities that helped fuel the financial crisis “and have fared fairly well.” Retail credit unions will only experience a minor impact due to problems encountered by corporate credit unions, Greg McBride, an analyst with, said in the article. An analysis of the credit union industry indicates substantial improvement between December 2009 and June, Jonathan Vande Streek, a financial analyst at Austin, Texas-based Highline Financial LLC, which studies the banking industry, told Marketwatch. “Our analysis showed that in December credit unions mirrored what banks were going through, but since then, the situation has improved significantly for credit unions,” he said. “Credit unions have experienced a significant improvement in March and June.” The number of credit unions at “an extreme risk of failure” dropped to 99 from 197, based on a Highline analysis, the article said. The number of “troubled” credit unions fell to 423 from 876. Highline publishes solvency ratings on banks, savings and loan institutions and credit unions. The ratings measure capital adequacy, asset quality, earnings and liquidity, MarketWatch said. “The credit union industry is generally healthy and it is healthier than banks by a large margin. You are seeing the limit of credit union exposure to the subprime debacle,” Jeffrey Pilcher, a former credit union industry consultant, said in the article. Also, in a video interview with Orol, Matz said NCUA’s action is not a bailout and will be largely invisible to consumers because credit unions have the capital to absorb the losses. She also explained why the corporates had securities in the portfolio that went bad (they were triple-A rated at the time of purchase) and how NCUA’s new corporate rule will prevent a recurrence. To read the article and view the video interview with Matz, use the link.

Brekken to chair Minnesota foundation

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ST. PAUL, Minn. (10/18/10)--The Minnesota Credit Union Foundation (MNCUF) board of directors named new table officers at its Thursday meeting. Pat Brekken was elected chair, Dave Larson was elected vice chair, and Kristi Mukomela was elected secretary/treasurer. Brekken is president of Richfield/Bloomington CU, Richfield. Larson is senior vice president of Affinity Plus FCU, St. Paul, and executive director of the Affinity Plus Foundation. Both were appointed to new MNCUF board seats in October 2009 and were elected to three-year terms in August. Mukomela, president of Novation CU, Oakdale, served as MNCUF chair since 2004. “As the Minnesota Credit Union Foundation continues to grow in prominence throughout the state, I am excited about the opportunities we have to make a real difference in peoples’ lives,” Brekken said. The table officers serve alongside four other directors with staggered board terms. The other directors include:
* Chuck Albrecht, Mid-Minnesota FCU, Baxter; * Mary Hansen, Mayo Employees FCU, Rochester; * Lynn Kothe, North Memorial FCU, Robbinsdale; and * Judy Root, Bluestone FCU, Eagan.

Caribbean CU growth needs more oversight--WOCCU

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MONTEGO BAY, Jamaica (10/18/10)--The importance that strong financial performance numbers play in ensuring safety and soundness continues to increase as credit unions grow in size and influence throughout the region was the primary message recently delivered to 43 credit union supervisors from 17 Caribbean island nations gathered in Montego Bay, Jamaica.
The Caribbean Confederation of Credit Unions (CCCU) supports prudential and proportional oversight for credit unions, according to CCCU President and World Council of Credit Unions Director Yvonne Ridguard. (Photo provided by the World Council of Credit Unions)
They participated in the Caribbean Credit Union Supervision Workshop, a three-day workshop co-sponsored by World Council of Credit Unions (WOCCU) and the International Monetary Fund's Caribbean Regional Technical Assistance Center (CARTAC). Credit unions in the Caribbean, more so than most areas of the world, are being swept up in moves toward increased prudential supervision and government efforts to improve the institutions’ financial health, WOCCU said. Growing liquidity in the region has brought the need for better supervision and stronger regulations to ensure that credit unions are making prudent investments on behalf of their members, who need access to deposit insurance systems comparable to those offered by banks. Credit union assets in eight Caribbean nations currently represent 10% or more of their country's gross domestic product, demonstrating their financial influences on their countries' economic systems. As economies improve, more nations will be joining that group, according to WOCCU Director Yvonne Ridguard, president of the Caribbean Confederation of Credit Unions (CCCU), a WOCCU member organization. “We support credit unions having prudential and proportional oversight appropriate to their activities,” Ridguard said. “The workshop provided the kind of expert training and understanding of credit union activities that is needed in the region.” Participants received detailed training and examined case studies on asset quality assessments, credit union capital structure, credit union and bank comparisons, and WOCCU's PEARLS monitoring system. Representatives from central banks, financial ministries and cooperative departments in the region, and credit union supervisors from the National Credit Union Administration in the U.S., the Deposit Insurance Corporation of Ontario, Canada, and CCCU participated in the workshop. “This may be one of the most important training sessions that WOCCU and its partners have conducted,” said Dave Grace, WOCCU's vice president of association services and workshop co-facilitator. “Open dialogue helped participants that traditionally only focused on the cooperative nature of credit unions recognize their financial aspects, while many supervisors that formerly only focused on the financial aspects walked away with greater appreciation for the credit union mission. We see it as a watershed moment.” WOCCU, along with the Canadian Cooperative Association, will co-sponsor a similar regional meeting of African credit union regulators and national associations representing 10 nations Dec. 1 through Dec. 3, in Malawi.

N.C.s SECU recognized for Direct Deposit efforts

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RALEIGH, N.C. (10/18/10)--State Employees’ CU (SECU) was among six financial institutions named as a 2010 Go Direct Champion, announced the U.S. Department of the Treasury’s Financial Management Service.
Click to view larger image From left: Dave Lebryk, commissioner of the Treasury Department's Financial Management Service; Sandra Jones, vice president, member education at State Employees' CU, Raleigh, N.C.; Dick Gregg, Treasury fiscal assistant secretary; and Michael Barr, Treasury assistant secretary for financial institutions. (Photo provided by State Employees' CU)
The recognition was for the Raleigh, N.C.-based SECU’s role in encouraging direct deposit among federal benefit check recipients. The Treasury’s national Go Direct campaign has helped more than four million Social Security and other federal benefit check recipients switch to direct deposit since its launch in 2005. SECU, a participant in the program for three years, has been recognized as a Champion for the past two years. Financial institutions with a minimum of 100 branches are eligible to participate in the Go Direct program. Nineteen organizations representing more than 25,000 branches nationwide joined the campaign. Programs were tracked for increases in Social Security and Supplemental Security Income ACH payments over an eight-month period. Accepting the award for SECU at a ceremony in Washington, D.C., was Sandra Jones, SECU vice president of member education. “Direct deposit is a safe and convenient way for federal benefit recipients to receive their payments. Not only does it eliminate the risk of lost or stolen checks, but it provides members access to their funds in a timely manner.” David A. Lebryk, commissioner of the Treasury Department’s Financial Management Service, noted that SECU played “an essential role in motivating its senior members, people with disabilities and other federal benefit recipients to switch from checks to safer, easier direct deposit.”

ICU Day webcast to focus on CU Heritage

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MADISON, WIS. (10/15/10)--Credit union contributions to members and communities around the world, through good times and bad, will be the focus of this year's annual International Credit Union (ICU) Day
Click to view larger image Credit unions worldwide play a vital role in meeting the needs of their members, said Pete Crear, president/CEO of the World Council of Credit Unions.
webcast on Thursday, co-sponsored by U.S. Credit Union Development Educators and World Council of Credit Unions (WOCCU). A panel of credit union and cooperative industry dignitaries will gather this year at the Credit Union House on Washington, D.C.'s Capitol Hill to discuss their collective member service heritage. "Credit unions in many different countries play a vital role in helping people who otherwise would lack access to basic financial services," said Pete Crear, WOCCU president/CEO and one of the panelists. "Celebrating ICU Day each year is a reaffirmation of the value credit unions provide to members at all socio-economic levels around the world." In addition to Crear, this year's panel will include Bill Cheney, president/CEO of the Credit Union National Association (CUNA); Paul Hazen, president/CEO of the National Cooperative Business Association; and Mark Meyer, CEO of the Filene Research Institute. The program will be moderated by Paul Berry, the voice of CUNA's Home and Family Finance Radio.
Click to view larger image International Credit Union Day offers opportunities to deepen members’ and communities’ understanding of credit unions, said Bill Cheney, Credit Union National Association president/CEO. (Photos provided by the World Council of Credit Unions)
"This year's theme of 'Local. Trusted. Serving You.' perfectly captures what makes credit unions so appealing to consumers across the nation and around the globe," Cheney said. "We will use the celebratory events planned for International Credit Union Day as an opportunity to deepen this understanding among our membership and within our communities." The webcast will allow time at the end of the discussion for panelists to respond to questions submitted from online audience members worldwide. The webcast will run from 3 p.m. to 4 p.m. ET on Oct. 21. It is open to the public and may be accessed by registering at WOCCU’s website (use resource link). The recorded program will be available for viewing on WOCCU's website after the broadcast. ICU Day has been celebrated annually on the third Thursday of October since 1948. The event provides a time and opportunity to honor those who have made great contributions to the global financial cooperative movement, to recognize the hard work of staff and volunteer board members working on behalf of credit unions and cooperatives today, and to express appreciation to members of credit unions and cooperatives living at home and abroad.

CU System briefs (10/14/2010)

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* SILVER SPRING, Md. (10/15/10)--The National Foundation for Credit Counseling (NFCC) has named Ellen Bernards of NFCC member agency GreenPath Debt Solutions as NFCC’s Professional Achievement and Counseling Excellence (PACE) Outstanding Individual Counselor for 2010. GreenPath, based in Madison, Wis., is a CUNA Strategic Services provider. Bernards created an on-site counseling program with Centro Hispano to deliver housing counseling services to predatory lending victims, acted as co-chair of the Dane County Foreclosure Prevention Task Force, assisted Spanish and Hmong individuals with personal finances, and more … * ALBANY, N.Y. (10/15/10)--The New York Credit Union Foundation has announced its LifeSmarts competition for 2010-2011 is now open and live at the program’s online site. The educational competition tests middle school and high school students nationwide on real-life consumer issues through online quizzes and live contests about consumer rights, the environment, health and safety, technology and finance. Students work with an adult coach and compete against other teams from New York, with state playoffs on March 30, 2011, in Schenectady (at the Varsity or high school level).. The state winner will proceed to the National Championship, which will be held April 30-May 3, 2011, in Hollywood, Calif. The winner of the Junior Varsity Competition (for middle schoolers) will be decided online, said the foundation … * ST. LOUIS (10/15/10)--Vantage CU debuted its new personal financial management tool, My$Manager, on Oct. 6 to members of MyVantage online banking at the St. Louis-based credit union. The tool works like other Web-based financial management tools that allow members to pull together and view their financial relationships from all institutions to make budgeting and goal setting easier. It features a dashboard that shows members’ entire financial picture based on accounts they’ve added; tools such as tagging; budgeting that tracks fixed and variable expenses; goal-setting and more. Members also can access their dashboard through their mobile phones, where they can check account balances, track goals and budgets and be alerted to upcoming bill deadlines …

CUs dumpster dive yields 1000 childrens books

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LEWISTON, Idaho (10/15/10--An employee of Clearwater CU, Lewiston, Idaho, found something unexpected in the credit union’s trash dumpster Wednesday morning--1,000 books. Debbie Taylor, an employee of the $30 million asset credit union, went to take out the trash at the start of her shift and discovered a large number of books in the dumpster, Taylor told (Oct. 14). “We went dumpster diving and got them out and saved all but about five of them,” she said. Many of the books—most of them children’s books--appeared brand new. The credit called the Lewiston Police, which is investigating. If the books are not claimed in two weeks, they will be donated to a worthy cause, Taylor said.

Fitch reaffirms then withdraws ratings of old U.S. Central

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NEW YORK (10/15/10--Fitch Ratings, a New York-based agency that rates corporate credit unions, has affirmed and withdrawn its ratings for U.S. Central Corporate FCU (USC) as a result of the formation of a new bridge corporate known now as the U.S. Central Bridge Corporate FCU. The bridge corporate assumed the operations of USC after USC was placed into conservatorship by the National Credit Union Administration (NCUA). Because the conserved charter has ceased operations and has been placed into an asset management estate with its remaining assets liquidated through securitizations, Fitch said it no longer considers the ratings of USC as relevant to the agency’s coverage. It decided to withdraw the ratings, Fitch said in a press release. NCUA created the bridge corporate on Sept. 24 in conjunction with an announcement of its corporate resolution plans, which included new regulations for corporate credit unions, the removal of about $50 billion in legacy assets and the creation of the bridge corporate.

Fake-check scams program launched in Colorado

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WASHINGTON, D.C. (10/15/10)--A new consumer education program to protect consumers and financial institutions from fake-check scams has been launched in Colorado with the support of credit unions and the Credit Union Association of Colorado. Other supporters include the Colorado Bankers Association, the Independent Bankers of Colorado, the AARP Foundation/Colorado ElderWatch program, the Colorado office of the U.S. Postal Inspection Service and the Consumer Federation of America (CFA). Currently, 21 financial institutions—including five credit unions--have signed on to participate. They will hand out CFA’s brochure, Don’t Be A Target--written in English and Spanish about fake-check scams and similar frauds--to consumers who deposit checks or money orders of $1,000 or more, or who withdraw $1,000 or more from their accounts. "The key is to prevent consumers from being victimized by educating them about these scams at the very point where they may be at risk," said Susan Grant, CFA's director of Consumer Protection, who is coordinating the program. In fake-check scams, a consumer receives a genuine-looking check or money order for something and is asked to wire money somewhere in return. Examples include sending an "advance" on a sweepstakes or lottery winnings. Or a consumer--recruited to work at home as a "mystery shopper" or processing payments for a company--is instructed to send money elsewhere as part of the job. The check or money order is phony, and when it bounces, the victim owes the financial institution where it was deposited or cashed. The average loss is $3,000 to $4,000. “Every year, Coloradans of all stripes fall victim to check-cashing scams," said Colorado Attorney General John W. Suthers. "One of the best ways to prevent yourself from being victimized is to recognize the warning signs of check scams. The most glaring sign of a check-fraud scam is if the person or organization sending you the check asks you to wire back part of the money. If this is the case, it is a scam.” The Credit Union Association of Colorado said, "Because of the close relationship that credit unions have with their members, they're committed to doing whatever they can to protect them from fraud." CFA provides training materials to institutions participating and advice about handing out the brochures. In addition to the brochures, there are two electronic versions, one in English and the other in Spanish, as well as a PowerPoint presentation for consumers and other educational materials, on CFA's website (use the resource link). Credit unions in Colorado interested in participating should contact Grant at 202-387-6121. The credit unions that are participating thus far in Colorado are:
* Arapahoe CU, Littleton; * Community Choice CU, Commerce City; * Credit Union of Colorado, Denver; * Rio Grande Operating CU, Denver; and * St. Vrain Valley CU; Longmont.

Mich. consumer survey findings mean CU opportunities

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LANSING, Mich. (10/15/10)--The economic crisis has hit Michigan consumers hard, presenting new challenges but also opportunities for credit unions in the state, indicates a 2010 Harris Interactive consumer study commissioned by the Michigan Credit Union League (MCUL). Despite the current economic conditions--job losses, foreclosures and falling home prices--a majority of Michigan consumers describe their personal financial situation as “fair” or “very good.” More credit union members (79%) describe their financial situation as good than bank customers do--67% (Michigan Monitor Oct. 11). Overall, 81% of respondents reported that they pay their bills on time and have no debts in collection. However, 11% of credit union members and 8% of bank customers struggle to pay their bills and are receiving calls from collectors. And 5% of bank customers and 2% of credit union members have considered filing for bankruptcy or have filed already. Although several programs can help, the study shows that, overall, consumers are not knowledgeable about them. This could present opportunities for credit unions to better inform members, MUCL said. For roughly one in three Americans (32%), the key to financial security is having a steady income. This is down from 37% in first quarter 2009, according to a national consumer study done by Market Strategies International. A steady income and the ability to pay bills on time each account for one-third of what makes people feel secure in their financial situation. Also, 11% of credit union members and 8% of bank customers said that adding to their savings each month would contribute to their sense of financial security. And, 8% of bank customers and 7% of credit union members say that ability to pay their mortgage or rent each month would add to their sense of financial security, while 11% in both groups said that nothing contributes to their financial security in the current economy. Little difference exists between bank customers and credit union members when it comes to planning for unexpected financial trouble, the study indicated. Only two in five respondents have a financial emergency plan for unexpected changes to their household income. Only one in four consumers would talk to their lender if their household income changes and they are faced with some financial problems or a foreclosure threat. This implies that few consumers are aware of federal or state programs to help with financing their mortgages. Consumers say they know more about personal finance than they actually do, MCUL said. Almost nine out of 10 credit union members say they are “extremely” or “very” knowledgeable about personal finance, but the self-assessment is not reflective of consumers’ true financial literacy, MCUL said. For instance, when compared with bank customers (58%), more CU members (71%) describe their credit scores as “good” to “excellent,” but this difference is not reflected when people report their actual credit score. Only 37% of credit union members and 34% of bank customers have credit (FICO) scores of 700 or more. While nearly two-thirds of Michigan residents have a mortgage or own a home, only 37% of credit union members, and 33% of bank customers accurately know when a mortgage payment is considered delinquent. Similar numbers of bank customers and credit union members keep track of the money they spend, with 64% of bank customers and 61% of credit union members using a budget. Thirty-eight percent of credit union members and 33% of bank customers say they have an idea of how much they spend, but do not keep track of spending. Only 3% in each group admit that they have no idea of how much they spend and do not keep track of their overall spending. Credit union members are more likely than bank customers to say the safest place to invest money is a savings account (24% vs. 15%, respectively) or certificate of deposits (14% vs. 12%). Twice as many credit union members (6%) are using money market accounts, compared with bank customers (3%). However, more than one-third of consumers overall do not believe there is a safe place to invest money at this time.

Mica selected for 2011 Co-op Hall of Fame

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WASHINGTON (10/15/10)--Former Credit Union National Association (CUNA) President/CEO Dan Mica is one of five outstanding cooperative leaders who will receive the cooperative community’s highest honor on May 4, 2011, when they are inducted into the Cooperative Hall of Fame. In addition to Mica, the 2011 inductees include: agri-business leader Noel Estenson; international cooperative developers Gloria and Stanley Kuehn; and civil rights leader and cooperative developer, Shirley Sherrod. They will be recognized at the annual Cooperative Hall of Fame Dinner and Induction Ceremony at Washington’s National Press Club. A public forum—the first held with the event—will meet the afternoon of May 4. The forum, also at the National Press Club, will feature current and future Hall of Fame inductees in moderated panel discussions about the role of cooperatives in the U.S. and world economics. “Our congratulations go out to Dan Mica,” said CUNA President/CEO Bill Cheney. “Entry into the Cooperative Hall of Fame is a distinct honor and well-deserved recognition for his wide-ranging record of accomplishment on behalf of credit unions, the cooperative community and the millions they serve." “The roster of the Cooperative Hall of Fame tells the story of the U.S. cooperative community through the lives and accomplishments of extraordinary individuals,” said Gasper Kovach Jr., board chair of the Cooperative Development Foundation (CDF), which administers the Hall of Fame. He pointed out that the induction is “reserved for those who have made genuinely heroic contributions to the cooperative community,” and added that only 147 individuals have been inducted since the Hall of Fame was established in 1974. Mica’s 14-year tenure, from 1996 to 2010, as CUNA president/CEO represented a period of significant accomplishment for the credit union movement, said CDF’s press release. “At a time of fierce battles with the banking industry, this former Member of Congress led a proactive legal defense and legislative/regulatory agenda that won landmark battles for credit unions and made CUNA into one of the most respected trade associations in Washington, D.C.,” said CDF. “In addition to putting programs in place that raised the movement’s political stature in Washington and strengthened its grassroots networks, Mica is also a savvy communicator who is credited with boosting the credit unions’ visibility in the national media, leading to greater consumer awareness and increased membership growth.” CDF is the 501(c)(3) non-profit affiliate of the National Cooperative Business Association. The Hall of Fame gallery is on display in NCBA’s offices in Washington, D.C. and on a website (use the resource link). For dinner attendance or sponsorship information, contact CDF at 703-302-8097 or at

Two new nominations submitted for CUNA board

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MADISON, Wis. (10/15/10)--Two new nominations have been received for seats on the Credit Union National Association (CUNA) board of directors, bringing the total nominees to nine. The deadline for nominations is Oct. 22. Voting will take place from Oct. 27 through Dec. 17. The most recent nominations were for Stephen G. Behler, president/CEO of Kemba CU, West Chester, Ohio, for the District 2, Class B seat; and Jeff York, president/CEO of CoastHills FCU, Lompoc, Calif., for the District 6, Class B seat. Nominations also have been received for:
* Brett Martinez, president/CEO, Redwoods CU, Santa Rosa, Calif., running for a District 6, Class C seat in a special election; * Harriet May, president/CEO, GECU, El Paso, Texas, District 5, Class C. May is currently CUNA's chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, District 4, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. The others elected will take office Feb. 28 and serve a three-year term that expires at the adjournment of the 2014 CUNA Annual General Meeting.

Michigan league endorses Snyder for governor

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LANSING, Mich. (10/15/10)--The Michigan Credit Union League (MCUL) Board of Directors Thursday announced its endorsement of Rick Snyder (R) for governor, citing his understanding of financial institutions and his balanced policies regarding the role of state government in the financial sector. Snyder is the candidate who understands the importance of the financial services industry for strengthening Michigan’s economy, MCUL said. “As some lawmakers advocate concepts such as a state-owned bank and a two-year moratorium on foreclosures, credit union leaders, who represent main street financial institutions, believe that Michigan’s next governor should carefully limit the role of government in the financial sector,” MCUL & Affiliates CEO David Adams said. “Michigan’s credit unions and other lenders have been battered by economic conditions and additional government regulations,” he continued. “They are finding it difficult to lend in this environment. Our next governor will need to help all main street financial institutions get stronger in order to unfreeze credit markets. Rick Snyder has the leadership skills and market understanding to achieve that. “Many things are necessary to bring Michigan’s economy back and to create jobs. Access to capital from local lenders is one of the most important factors for a revitalized Michigan economy,” Adams said. A moratorium on foreclosures would have a chilling effect on Michigan’s economy and hurt credit unions and other lenders that are struggling to control mortgage-lending related losses stemming from Michigan’s high unemployment rate and struggling housing market, the league said. Credit unions have been lending during the economic crisis while other lenders have not been able to do so. During the past 12 months ending June 30, credit unions’ total loans were up by 1.2%. Michigan banks’ total loans went down 12% in the second quarter, according to data from MCUL. During the same period, all types of credit union lending rose. Small-business loans were up by more than 17% while Michigan banks’ business loans declined 5.7% in the first half of 2010. Michigan needs a governor who understands the important role local lenders, such as credit unions, play in strengthening the economy by making credit available to consumers and small businesses, said the league. This needs to be done without unnecessary government regulations and policies that would serve to further restrict access to credit by adding to lenders’ costs and restricting their ability to grow their loans and deposits, MCUL concluded.

CU System briefs (10/13/2010)

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* MADISON, Wis. (10/14/10)—Kim Sponem, president of Madison, Wis.-based Summit CU, has added the title of CEO, effective Oct. 1, following Andy Faust’s planned retirement on Sept. 30. Sponem was president/CEO of Great Wisconsin CU (formerly CUNA CU) for more than six years until it merged with Summit CU in 2008. The $1.5 billion asset credit union has more than 118,000 members and 24 locations in the Madison and Milwaukee areas (Wisconsin State Journal Oct. 12) … * LANSING, Mich. (10/14/10)--Catherine Roberts, former CEO of Research FCU and Community Choice CU, Farmington Hills, Mich., has achieved the designation of international credit union development educator (DE) from the University of Edinburgh, Scotland, according to the Michigan Credit Union League (Michigan Monitor Oct. 11). “Credit unions around the world share the same passion and enthusiasm for the credit union movement as we do,” Roberts said. The next DE class will be in April 2011 at the Credit Union National Association’s Madison, Wis., offices. Roberts is a member of the World Council of Credit Unions’ board … * NASHVILLE, Tenn. (10/14/10)--Jimmie Watson Bearden, former CEO of AEDC FCU in Tullahoma, Tenn., for a number of years, died Monday in Murfreesboro, Tenn. She was 77. She is survived by two sons, a daughter and three grandchildren. Funeral services will be at 2 p.m. Sunday at the First United Methodist Church, Tullahoma, with visitation Saturday from 3 p.m. to 7 p.m. at the Tullahoma Funeral Home (The Tennessean Oct. 13) …

Text banking launched at UW CU

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MADISON, Wis. (10/14/10)--—UW CU has launched Text Banking, a new online banking feature for its members, the credit union announced Wednesday. Text banking is a free service that allows members to interact with and manage their UW CU accounts using text messages on their mobile phones. Members can perform common banking functions--such as checking balances on their accounts, transferring money between accounts and initiating Money Link--without having to log in to Web Branch, said the Madison, Wis.-based credit union. To use the service, members must have a text messaging (SMS) service and sign up through Web Branch. “We created this system so members can manage their accounts effectively, wherever they go--even if they don’t have Web access,” said Eric Bangerter, director of Internet Services at UW CU. “For instance, in the past, if members received an automatic low balance alert via text message, they had to log in to the Web Branch, either at a computer or with their Web-enabled mobile device with Mobile Banking.” Now, they can text a command to the credit union and transfer funds between accounts, with funds available immediately, Bangerter said. “For many people, it isn’t easy to keep on top of their finances,” said Paul Kundert, president/CEO of UW CU. “We’re providing this tool so people can check balances and transfer funds wherever they go.”

Dudley gains CU support in Oregon gubernatorial race

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BEAVERTON, Ore. (10/14/10)--Political newcomer Chris Dudley has won the support of the Credit Union Association of Oregon (CUAO) in the state’s gubernatorial race. Dudley, a former professional basketball player with the Portland Trailblazers, won the Republican nomination last May in a fiercely contested primary, said CUAO. He has not held political office before, but the association said its board believes he offers a fresh perspective on many issues facing the state. “Our board has great respect for former Gov. (John) Kitzhaber and what he has done for the state,” said Pam Leavitt, CUAO’s vice president/governmental affairs. “But in these unprecedented times our board believes that Mr. Dudley is best suited to help unify citizens and seek common ground in what has become a very partisan atmosphere over the last few years.”

TCUF grants total over 203234 for 2010

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FARMERS BRANCH, Texas (10/14/10)--A grant to Unity One CU in Fort Worth, Texas, is the latest from the Texas Credit Union Foundation (TCUF), which has made 74 grants to credit unions, chapters and local partners totaling more than $203,234 in 2010. The grants provide credit union training and education, financial education initiatives and local outreach programs (LoneStar Leaguer Oct. 13). Unity One CU received its $2,500 grant for $2,500 to sponsor its “Build Your Own Credit Union Program,” which introduces teens to the importance of being financially literate through hands-on education. Students interact with members of the business sector, who provide real life situations and share their expertise in their fields. The students also serve as an informal focus group to help the credit union identify products and services to attract members from GenY and beyond. TCUF also provided 41 Southwest CUNA Management School scholarships totaling $51,246 to 15 first-year students, 12 second-year students and 14 third-year students. “This year has been one of change, from the economical standpoint through the operations within the industry, but it was one that the foundation took extra steps to provide exceptional training and assistance through,” said Courtney Nickles, executive director of TCUF. “We’ve taken financial literacy to the classrooms of hundreds of schools around the state, brought our efforts to a global audience in Belize and have made plans to make 2011 even more successful.” TCUF also administers the Community Investment Fund (CIF) Grants program on behalf of the Texas Credit Union League. Throughout the year, it has made 66 grants totaling $123,795 to credit unions for training and education, small credit union workshops, system upgrades, audits, planning sessions, equipment and a scholarship to attend the Development Educator Program. The foundation also has a new video, “Together We Make a Difference,” which details exceptional results that are gained when credit unions, their members and their communities are engaged and the efforts of TCUF during 2010. It can be viewed at TCUF’s website.

State-level candidates receive MarylandDC CUs support

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COLUMBIA, Md. (10/14/10)--The Maryland and District of Columbia Credit Union Association (MDDCCUA) has given support to several state-level candidates in the November elections. The MDDCCUA board has endorsed Maryland Comptroller Peter Franchot as he seeks re-election. It named him to “Friend of Credit Unions” status. “Maryland credit unions strongly approve of the work that Comptroller Franchot has done over the past four years,” said MDDCCUA Interim CEO Jennifer Simmons. “Credit unions have been particularly thankful of Franchot’s passion for financial literacy education, and look forward to continuing to work with him on ensuring that Maryland public high school students graduate with a firm understanding of how to properly manage one’s finances.” The board also has voted to endorse Maryland Attorney General Doug Gansler for re-election and bestowed upon him the “Friend of Credit Unions” status. “Maryland credit unions believe that Attorney General Gansler is a strong advocate for consumers,” said Simmons. “We hope to forge a strong working relationship with the Attorney General as credit unions work to deliver the best possible services for consumers.” The board also endorsed 40 candidates seeking seats in the Maryland General Assembly under the “Friend of Credit Unions” status.

Aldi data breach prompts account closures

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MADISON, Wis. (10/14/10)--A data breach at Aldi’s grocery stores as a result of tampered debit card payment terminals at some stores has affected many financial institutions, including at least one credit union. ESL FCU, a $3.74 billion-asset credit union based in Rochester, N.Y., shut off 3,700 member debit cards Saturday to prevent infiltration of accounts, said ESL spokeswoman Francine Patella Ryan (Democrat & Chronicle Oct. 13). The credit union has been reviewing account activity for unusual transactions, the newspaper added. The breach has occurred in at least 11 states, according to Aldi’s website, but could be even more widespread. Aldi said its machines were tampered with between June 1 and Aug. 31 ( Oct. 2). Roughly 200 people notified authorities that unauthorized withdrawals ranging from $100 to $900 were taken from their accounts, the Chicago Tribune reported (via Aldi operates more than 1,100 U.S. stores in 31 states from Kansas to the East Coast.

CUNA Technology Council re-elects executive committee members

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MADISON, Wis. (10/14/10)--The CUNA Technology Council recently re-elected its executive committee. Rudy Pereira, senior vice president of operations and technology, Alliant CU, Chicago, and Butch Leonardson, senior vice president/chief information officer, BECU, Seattle, Wash., were re-elected to the two committee seats up for election. Continuing to serve in leadership roles are Pereira as chair and Robert Reh, chief information officer, Nassau Financial FCU, Westbury, N.Y., as vice chair. John Drago, vice president of information technology at the California and Nevada Credit Union Leagues, was appointed to serve as the leagues’ representative to the executive committee. Other executive committee members include:
* Jennifer Weiss, vice president, technology services, Sandia Laboratory FCU, Albuquerque, N.M.: * Jeff Johnson, senior vice president, information technology, Baxter CU, Vernon Hills, Ill.; * Heather Moshier, executive vice president, information technology, San Diego County CU; * Belinda Caillouet, vice president, information technology, Spokane (Wash.) Teachers CU; and * Chad Graves, vice president, information technology, Ent FCU, Colorado Springs, Colo.

MDDCCUA endorses Kratovil other candidates for Congress

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COLUMBIA, Md. (10/14/10)--The board of directors of the Maryland and District of Columbia Credit Union Association (MDDCCUA) voted to endorse U.S. Rep. Frank Kratovil (D-Md.) and designate him with “Friend of Credit Unions” status. “Congressman Kratovil has been an independent thinker and a very approachable member of the Maryland congressional delegation,” said MDDCCUA Interim CEO Jennifer Simmons. “We look forward to continuing to work with the congressman to improve the lives of the residents of the First District.” In its endorsement of Kratovil, the board noted how he was willing to meet with credit union members and staff to discuss many issues, including his support for an increase in lending to small businesses. Also, the board was impressed by Kratovil’s ability to work across party lines to ensure that the interests of his district were best represented. “Congressman Kratovil has shown that it is possible to be a strong voice for consumers by being willing to work with Democrats, Republicans, and community and business leaders,” Simmons said. “Because of his non-partisan style of leadership, Maryland credit unions hope to continue their strong working relationship with Congressman Kratovil in the years to come.” “By extending credit to homeowners and small businesses, credit unions are playing an important role in our economic recovery, and I look forward to continuing to work with the district's credit unions in the months ahead to get our economy back on track,” Kratovil said. Kratovil is one of nine candidates running for the U.S. House of Representatives to receive the MDDCCUA “Friend of Credit Unions” designation. The others are:
* Majority Leader Steny Hoyer (D-5); * Rep. C.A. Dutch Ruppersberger (D-2); * Rep. John Sarbanes (D-3): * Rep. Donna Edwards (D-4); * Rep. Roscoe Bartlett (R-6); * Rep. Elijah Cummings (D -7): * Rep. Chris Van Hollen (D-8); and * Rep. Eleanor Holmes Norton (D-D.C.).

Hunt Schrader named Oregons legislators of the year

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BEAVERTON, Ore. (10/14/10)--The Credit Union Association of Oregon (CUAO) has named Oregon Speaker of the House Dave Hunt (D-Clackamas County) “State Legislator of the Year” and U.S. Rep. Kurt Schrader (D-Ore.) “Federal Legislator of the Year.” Hunt was recognized for his leadership in helping to pass CUAO’s Public Funds Bill in the last special session of the Oregon Legislature. Schrader was honored for his leadership in sponsoring HR 3880, which would increase member business loans. “Both Speaker Hunt and Congressman Schrader have been long-time supporters of credit unions and they have proven that commitment again this last year,” said Pam Leavitt, CUAO vice-president for governmental affairs. Hunt made passing the Public Funds Bill a top priority in the February session. “Speaker Hunt didn’t waver in his support despite the strong rush of opposition from some powerful lobbyists,” said Pat Smith, president/CEO of Unitus Community CU, Portland. The bill will allow government entities to deposit funds such as tax receipts and payroll into credit unions for the first time in the state. “Congressman Schrader has always been there for us,” said Rick Hein, president/CEO of OSU FCU, Corvallis. “To take a leadership role on this important bill, as a freshman in Congress, is quite remarkable.” Schrader was the first member of the Oregon delegation to sign on to the federal legislation to increase the cap on member business loans. “We hope Congressman Schrader will continue to be a strong advocate for the bill in the next Congress and that will help us leverage his support to obtain additional sponsors,” Leavitt said.

CUs prepare for ICU Day next week

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MADISON, Wis. (10/14/10)--Webinars, board games, free credit checks and other innovative events will help credit unions, members and communities celebrate the credit union difference on International Credit Union (ICU) Day, Oct. 21. Leaders from the credit union movement will participate in the free webinar, Celebrating Our Cooperative Heritage , at 3 p.m. ET. The webinar will originate at Credit Union House in Washington, D.C. with host Paul Berry, the voice of the Credit Union National Association’s (CUNA) Home and Family Finance Radio, along with Bill Cheney, president/CEO, CUNA; Pete Crear, president/CEO, World Council of Credit Unions (WOCCU); Paul Hazen, president/CEO, National Cooperative Business Association; and Mark Meyer, CEO, Filene Research Institute. Participants can ask questions and make comments throughout the program, which is hosted by the U.S. Credit Union Development Educators and WOCCU. To register, visit the ICU Day webinar site. Credit union plans for celebrating ICU Day across the country often stretch into multiple days or even a full week of activities. Some examples include:
* Volunteers from Redwood CU, Santa Rosa, Calif., will appear unannounced at sites throughout the North Bay and San Francisco area on ICU Day to perform good deeds. The $1.7 billion asset credit union announced that its activities will include bagging groceries with free eco-totes at select supermarkets, handing out free lunches, distributing free school supplies at local colleges and paying parking fees for drivers. * A Shred Fest will help members of Ticonderoga (N.Y.) CU learn ways to prevent identity theft. A mobile shredder will be available at three credit union branches on Oct. 18 and 19 to shred paper, folders and envelopes, which will then be recycled. A Ticonderoga CU press release said members who participate are encouraged to bring a non-perishable food item to donate to local food pantries. The $77.1 million asset credit union will also distribute information on guarding against identity theft and promote e-statements. * Reality-based financial education events will teach money management skills to students in the Columbus, Dayton and Toledo areas in Ohio Oct. 18-22 (eLumination Oct. 6). Miami Valley High School students will play the “Life After High School” board game created by Universal 1 CU, Dayton, to learn how life choices impact their financial future. The Northwest Chapter will guide students with a “real world” simulation called “Finances 101” at Bowling Green State University and schools in central Ohio. The Ohio Credit Union League is joining with the Central Ohio and Miami Valley Chapters to sponsor the events, which rely on financial education initiatives developed for statewide use with Ohio Credit Union Foundation grants. * Forum CU, Indianapolis, will participate in Indiana’s fifth annual Money Smart Week Oct. 18-22. The $999 million asset credit union announced special offers for members that include free credit checks on Oct. 18; a comprehensive budgeting review on Oct. 19; $5 for opening a qualifying savings account on Oct. 20; information about the credit union difference for ICU Day on Oct. 21; and candy, kids’ activities and information on kids’ and teens’ accounts as part of Kids’ Day on Oct. 22. * A pumpkin giveaway, a coloring contest for kids and free doughnuts and cider will highlight week-long ICU events at $335 million-asset Consumers CU, Kalamazoo, Mich., according to a Consumers CU press release. * The Mid-Michigan Chapter of Credit Unions will launch its 18-week sponsorship of the Biz Kids television program on local Public Broadcasting Service (PBS) stations on Oct. 22. The sponsorship spotlights youth financial literacy and spreads the word about credit unions in the community with an introduction and exit that names the 19 credit unions involved in the chapter. The Mid-Michigan Chapter uses the proceeds of its summer golf outing to support a cooperative community project each year. * Louisiana Credit Union League chapters, like other chapters across the country, will host receptions and dinners to celebrate ICU Day (eNews Sept. 29 and Oct. 6).
CUNA’s ICU Day web site (use the resource link) offers a wide range of ideas for highlighting credit union contributions with community projects, product and services promotions, financial education, and special events. A sampling of ICU Day ideas includes:
* Offering loans or new share draft accounts for the same fees that were charged the year your credit union opened; * Making your credit union into an elementary school field trip destination to help teachers build real-world experience into math lessons; * Telling members about the worldwide credit union movement by serving international foods and displaying posters; * Offering a series of lectures on basic finance topics during the lunch hour or in the evening; * Rewarding employees and recognizing members who provide exceptional service to the community; * Sponsoring a safe Halloween program for local children; * Planting a tree in a nearby park or on your credit union grounds; and * Collecting business clothes to donate to a local organization that helps people prepare for the workplace.

IDet. Free PressI Big banks lose CUs have banner year

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DETROIT (10/13/10)--An article in the Detroit Free Press about big banks in Michigan losing market share also mentions that credit unions have had a "banner year." As of June 30 Michigan's five largest banks--Chase Bank, Comerica Bank, PNC Bank, Bank of America and Fifth Third Bank--accounted for 55% of all deposits in the state--down from 57.3% on June 30, 2009. Deposits dropped by $8.1 million or 5% as the number of banks in the state shrank to 165 from 173. The Oct. 8 article mentions that big banks have been the target of a backlash among some consumers and businesses about bailouts. The banks "have been accused of redlining the state and the auto industry by pulling credit lines and refusing to make new loans," said the article. "Credit unions in Michigan have capitalized on the bank backlash, spending a record amount on advertising this year," it continued. The article cited statistics from the Michigan Credit Union League that note that credit unions gained nearly 15,000 members so far this year and theirsavings deposits are up 7.5% through second quarter. David Adams, president/CEO of the league, told the publication: "It's going to be a banner year for credit unions." For the full article, use the resource link.

Wis. regulator files plan for seized Ambac securities

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MADISON, Wis. (10/13/10)--The Wisconsin regulator of Ambac Assurance Corp. (AAC), the monoline U.S. bond insurer whose securities were seized in March, has filed a plan to wind down more than $50 billion left in insurance policies related to the seized securities. Several corporate credit unions have mortgage-related investments insured by Ambac and incurred losses during the financial crisis. The Wisconsin Office of the Commissioner of Insurance (OCI) said that under the plan, holders of allowed claims will receive 25% of their claims in cash and another 75% in notes that pay interest of 5.1% and mature June 7, 2020 (Reuters via Insurance Journal Oct. 12 and Oct. 12). The 75% payout in notes reflects the need to preserve cash to pay current and future claims, the regulator said In March the insurance commissioner placed $67 billion of Ambac's assets into a segregated account to help protect investors of Ambac Assurance Corp. in the Dane County Circuit Court in Madison, Wis. Ambac's assets included credit derivatives and residential mortgage-backed securities. Roughly 700 in-force policies covering a net par outstanding amount of about $50 billion are allocated to the segregrated accounts. OCI has monitored the company's financial health since the mortgage crisis began in 2008. The economic downturn and the mortgage-related exposures damaged AAC's business and financial position. AAC's parent company, Ambac Financial Group, which is headquartered in New York, is not regulated in Wisconsin and not subject to the plan's terms. AAC is domiciled in Wisconsin. The court must approve the plan before it goes into effect, said Reuters.

Seventh nomination received for CUNA Board

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MADISON, Wis. (10/13/10)--A seventh nomination has been received for a seat on the Credit Union National Association (CUNA) board of directors. The deadline for nominations is Oct. 22. Voting will take place from Oct. 27 through Dec. 17. The most recent nomination was for Brett Martinez, president/CEO of Redwoods CU, Santa Rosa, Calif., running for the District 6, Class C seat in a special election. There is one special election: CUNA's current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting. Nominations also have been received for:
* Harriet May, president/CEO of GECU, El Paso, Texas, for the District 5, Class C. May is currently CUNA’s chairman; * Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, District 4, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
Those elected will take office Feb. 28 and serve a three-year term that will expire at the adjournment of the 2014 CUNA Annual General Meeting.

Interviews highlight Maine CUs as resource

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WESTBROOK, Maine (10/13/10)--The Maine Credit Union League spoke on topics that included the importance of financial education, the benefits of using a credit union, tips for consumers and shared branching in a series of TV interviews, three of which aired statewide. The interviews, which aired as special segments during morning news programs, reinforced Maine credit unions as a resource for information and expertise, said the Maine Credit Union League (Maine Credit Union League’s Weekly Update Oct. 8). In three different segments that aired on various days, league Governmental and Public Affairs Manager Jon Paradise discussed how back-to-school shopping can be a valuable learning opportunity about personal finance for children and college students. He also talked about proper credit card usage Also discussed were credit cards and credit unions’ lower and fewer fees, and the leadership efforts of Maine's credit unions and youth financial education. The other interview aired as part of WGME News 13's Good Day Maine program, which is carried on FOX 23. It was aimed at college students and their parents. In it, the league encouraged parents to talk about financial responsibility with students before they leave for campus. The story also noted that college students don’t have to leave their credit union when they leave home because of 130 Shared Branch Network locations statewide.

Texas Ohio reports spotlight CU growth

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FARMERS BRANCH, Texas and COLUMBUS, Ohio (10/13/10)--Reports from Texas and Ohio credit union groups highlight continued growth in new members and other key indicators. The Texas Credit Union Profile from the Texas Credit Union League provides one-year comparisons between June 2009 and June 2010 (LoneStar Leaguer Oct. 12). Texas credit unions’ achievements included:
* 142,000 new members, with Texas credit unions serving 29.5% of the state’s residents; * Asset growth of $4.3 billion, with nearly $2 billion in new loans; * Increased deposits, with most deposit growth occurring in money market accounts; and * An average net worth of 9.7%, nearly three percentage points higher than the National Credit Union Administration (NCUA) requirement.
Texas has benefited from a statewide economy that has continued to grow, adding nearly 108,000 workers to Texas payrolls in the year ending in June 2010, compared to a collective loss of 329,000 employees in the other 49 states, said the league. Ohio's credit unions also grew. The Quarterly Performance Summary from the Ohio Credit Union League also compares performance from June 2009 to June 2010, according to an Ohio Credit Union League press release. Results from Ohio credit unions included:
* Net membership growth of 9,148 new members; * A 4% increase in the average member relationship to $11,375; * A 13.3% increase in outstanding business loan balances, which totaled $371 million, with 94 of the state’s 390 credit unions reporting outstanding balances; and * Strong asset quality, with a delinquency rate that fell to 1.29%, representing the first decline in three years and placing Ohio credit unions below the national average of 1.74%.

Innovation member-centric programs made CU tops

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TOWATA, N.J. (10/13/10)--Going green, staying member-centric and giving back to the community helped North Jersey FCU become New Jersey Credit Union of the Year for 2010. North Jersey, which has more than $188 million in assets, has introduced a comprehensive “green” initiative with multiple components that reflect its member-centric approach. Its “Organic Banking” program for college students relies on online banking and e-statements, and attracted more than 100 new accounts within three weeks. North Jersey’s “Green Machine” is a mobile banking “tank” that runs on biodiesel fuel and offers an ATM, two teller windows and two loan offices to replace a traditional branch. North Jersey also introduced “Operation Share & Care,” a community service initiative that uses a series of community events to highlight the importance of volunteering and giving back to the community. The initiative led the North Jersey FCU Foundation, established in September, to begin providing scholarships for students seeking careers in banking and finance. Other factors in North Jersey’s selection included diverse member services and outstanding growth. The award was presented by the New Jersey Credit Union League.

Pa. CUs 10-10-10 promo a Perfect 10

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HARRISBURG, Pa. (10/13/10)--PA HealthCare CU, Sewickley, Pa., highlighted Sunday's date--10-10-10--by offering members a $1,010, 10-week CD share certificate. The “Perfect 10” offer was available to members of the $30 million-asset credit union for 10 hours on Friday, Oct. 8 (Life is a Highway Oct. 12). Other “Perfect 10” promotions included a one-year CD at 1.10% annual percentage yield (APY); a five-year auto loan for 2010 or newer model years at 4.10% annual percentage rate (APR); and a five-year home equity loan at 4.10% APR. More than 5% of members took advantage of “Perfect 10” offers, which followed the tradition set by the credit union’s “Crazy 8’s” offer on 08-08-08 and the “Whole 9 Yards” on 09-09-09.

CU System briefs (10/12/2010)

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* ARLINGTON, Texas (10/13/10)--John Thi Pham, 18, of Arlington, Texas, is in jail after he was caught inside the Security One FCU early Monday morning. The break-in set off the credit union's alarm at about 4 a.m. When they arrived, police discovered broken glass outside the building and a man in the building. They ordered the man outside, but he refused and hid. Police went inside the building, discovered Pham and took him into custody (The Fort Worth Star-Telegram Oct. 11) ... * LANSING, Mich. (10/13/10)--U.S. Rep Ehlers (R-Mich.) thanked local credit union leaders for their support during his years of service in Washington D.C. and talked about his frustration with a "rushed" political process in passing the Wall Street Reform Act, during the Grand River Chapter of Credit Unions' legislative breakfast. Credit unions thanked him for his co-sponsorship of the measure to increase credit unions' member business lending cap. More than 20 credit union leaders participated in the event, which also attracted state Sen. Bill Hardiman and other state legislators, as well as staff from U.S. Rep. Pete Hoekstra's (R-Mich.) office. Also discussed: foreclosure process reform, PACE loans, payroll debit cards and notary requirements (Michigan Monitor Oct. 11) ... * WICHITA, Kan.(10/13/10)--Troy Nitcher has joined the Kansas Credit Union Association (KCUA) as vice president, shared financial solutions, effective Sept. 27, KCUA announced. With more than 20 years of information technology (IT) experience, Nitcher will head up KCUA's Shared Financial Solutions division, which provides IT and payment systems products and services to credit unions in Kansas and around the region. His experience includes working at Koch Industries, FleetCor,, BeautyFirst Inc. & PureBeauty Inc., and Ritchie Corp ...

CU serving churches among Ponzi scheme victims

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SOUTHFIELD, Mich. (10/12/10)--A Southfield, Mich.-based investment adviser has been indicted on felony bank fraud and wire fraud charges related to an elaborate Ponzi scheme that stole $10 million from investors that included a local union, state municipalities, a school district, and a credit union serving churches. According to federal prosecutors, Dante DeMiro, 43, founder and managing director of MuniVest Financial Group and MuniVest Services LLC, allegedly promised clients he would buy millions of dollars in certificates of deposit but instead alleged used the funds to make loans to a jewelry store and repay earlier investors (The Detroit News and Oct. 8). Ponzi schemes are a fraudulent practice in which funds paid by later investors are used to pay off earlier investors. The indictment said the scheme had run since at least March 2009. The credit union was not named in the report. Other victims included taxpayers of Lapeer County, Mich., Mona Shores Public Schools in Muskegon, schools in Comstock Township near Kalamazoo, and Boiler Makers Local 169 in Allen Park, Mich. (The Detroit News Oct. 8). If convicted, DeMiro faces up to 30 years in prison and a $1 million fine if convicted of bank fraud, plus 20 years and $250,000 if convicted of wire fraud.

Transportation Northwest CU Alaska USA FCU merge

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SEATTLE and ANCHORAGE, Alaska (10/12/10)--Transportation Northwest CU (TNCU), based in Seattle, has merged with Anchorage, Alaska-based Alaska USA FCU, the credit unions announced. The merger was effective Friday. In a letter sent to members Wednesday and posted on its website, Transportation Northwest Board Chair Mia Waters noted that the "depressed real estate market and higher unemployment levels here in Washington have hit TNCU particularly hard." Hoping to gain a better balance, Waters said, the$30 million asset credit union had pursued a merger with another credit union. However, that merger was called off earlier this summer because it was not consistent with the other credit union' long-range strategic plan, Waters said. TNCU redirected its efforts to $4.1 billion asset Alaska USA and the merger was approved by both boards in August. Washington State's Department of Financial Institutions approved the merger and waived the membership vote to speed up the merger for a faster reinstatement of dividends, the letter said. NCUA also approved the merger, effective Friday. Then, dividends on share accounts at TNCU were reinstated as Alaska USA assumed the credit union. Alaska USA operates 17 branches in the Pacific Northwest plus four mortgage lending offices and three insurance agency offices. "Over the next few months it will be business as usual at TNCU" while Alaska USA transitions TNCU accounts to its data systems, Waters said.

CUNA Mutual celebrates 75th anniversary of first claim

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MADISON, Wis. (10/12/10)--Seventy-five years have passed since CUNA Mutual Group paid its first claim of $40 on the death of a Milwaukee Road switchman. Today, CUNA Mutual pays daily claims worth almost $3.4 million. In 2009, it disbursed $851 million to policyholders. Since it was founded in 1935, CUNA Mutual has paid out more than $28 billion in life, health, property and casualty insurance benefits. Larry Holweger, CUNA Mutual’s senior vice president of claims, noted the company is committed to continuing to deliver on its promises in the years ahead. CUNA Mutual employees marked the anniversary with a picnic lunch that was also part of their observance of Customer Service Week.

Desjardins Awards hit 10-yr. milestone CUNA announces

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MADISON, Wis. (10/12/10)--After 10 years, interest in the Desjardins Youth Financial Education Award shows no signs of decline. This year saw a record number of state entries (105), national entries (58), and states represented through their leagues (30). "It’s exciting indeed to note the steady growth in credit unions’ participation in the Desjardins recognition program,” said Credit Union National Association (CUNA) President/CEO Bill Cheney. “That shows that, despite serious competitive business concerns over the past decade, the movement has reinforced its historical commitment to improving members’ financial well-being from childhood on.” “Desjardins Award recipients serve to model and stimulate creative new ways to better young people’s lives through financial education. I look forward to honoring this year’s exemplary credit unions at CUNA’s 2011 Governmental Affairs Conference," Cheney said. Desjardins winners (asterisks below indicate repeat award recipients) include:
* The Credit Union League of Connecticut; * Arapahoe Credit Union,* Centennial, Colo.; * Maine Credit Union League*; * Mission SF FCU, San Francisco, Calif.; * Palmetto Citizens FCU,* Columbia, S.C.; * Travis CU, Vacaville, Calif.
Honorable mentions will be presented to:
* A+ FCU,* Austin, Texas; * Altra FCU, Onalaska, Wis.; * Credit Union 1, Anchorage, Alaska; * DOCO Regional FCU, Albany, Ga.; * Horizon CU, Spokane Valley, Wash.; and * Tinker FCU, Oklahoma City, Okla.
In December, PDFs of the winning entries will be available for viewing on CUNA’s website. The actual winning entries will be on display and the awards presented at CUNA's GAC (Feb. 27-March 3) in Washington, D.C. The youth financial education award is named for Alphonse Desjardins, the founder of the North American credit union movement. It honors credit unions for their work on behalf of youth financial literacy.

Pa. CUs performance improves in 2Q

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HARRISBURG, Pa. (10/12/10)--Pennsylvania credit unions saw improved financial performance in the second quarter because net interest margins stabilized and operating expenses declined, said the Pennsylvania Credit Union Association (PCUA). The Pennsylvania Profile, Economic Summary for Second Quarter 2010 shows Pennsylvania credit unions outpaced national growth rates in all categories: assets, loans, total surplus funds, total savings and total members, for the 12-month period ending June 30 and for the second quarter 2010 (Life is A Highway Sept. 30). Credit union membership in Pennsylvania grew 2.2% in the 12-month period, and 0.5% for the second quarter. The national growth rate for the 12 months was 0.9%. Since second quarter 2009, Pennsylvania credit union total assets grew 8.9%; loans increased 5.4%; and savings rose 9.3%. However, savings growth slowed to 1.2% growth in the second quarter from 3.6% in the first quarter. Pennsylvania credit union loan balances increased 0.9% in the second quarter, faster than the national average of 0.3%, PCUA said. In loan categories, member business loans grew 6.7% in the second quarter and 26% in the 12-month period. Other top-performing loans were first mortgages, which grew 2.8% in second quarter and 16% since June 2009; used-auto loans, 2.6% for second quarter and 6.9% over the 12-month period; and credit cards, 2.3% in second quarter and 12% for the 12-month period. Slight second-quarter growth in consumer spending is reflected in loan growth, PCUA said. The housing market continues to struggle in Pennsylvania, and the labor market continues to deteriorate, the association added.

CU System briefs (10/11/2010)

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ATLANTIC CITY, N.J. (10/12/10)--Ten small New Jersey credit unions that participated in the Small Credit Union Initiative (SCUI) the past year and completed all requirements were recognized at the New Jersey Credit Union League's 76th Annual Business Meeting Oct. 4. Representatives pictured are from: Elizabeth NJ Firemen's FCU, Franklin-St.John's CU, Jersey Central FCU, Lakewood Community FCU, Messiah Baptist FCU, Parlin DuPont Employees FCU, Public Service FCU, Rancocas FCU, Salem Baptist FCU, and St. James A.M.E. FCU. SCUI provided participants with services at no cost, including membership satisfaction surveys, board/management training through the Credit Union National Association's CPDOnline and league sessions, quarterly participant meetings and networking, field staff support, registration for chapter meetings, peer analysis and facilitated strategic planning sessions. The program is funded by the National Credit Union Foundation, New Jersey Credit Union Foundation and the New Jersey league (The Daily Exchange Oct. 11). (Photo provided by the New Jersey Credit Union League) ... * HARAHAN, La. (10/12/10)--A former teller at Jefferson Parish Employees FCU has been charged in the theft of $31,000 from her teller drawer, said the Jefferson Parish Sheriff's Office. Leslie Leblanc, 24, of River Ridge, a teller for about five years, was charged Wednesday with theft of more than $1,500 after the credit union performed a surprise cash count Oct. 5 as part of its auditing procedures and her teller drawer came up short. She told police the thefts occurred over a period of 10 months to finance gambling at casinos and some cash bills. The credit union said no member accounts or vault funds were affected. (The Times-Picayune via Oct. 7) ... * DES MOINES, Iowa (10/12/10)--The Iowa Credit Union Foundation has hired Adam Carroll as financial education consultant. Carroll will provide financial education training and technical assistance to Iowa credit unions through a grant from the Northwest Area Foundation. He will develop turn-key solutions and templates for credit unions delivering financial education and will teach credit unions how to present the information for their members. Carroll is founder of National Financial Educators, a financial literacy program designed to educate college students across the country. He is publisher of "Winning the Money Game" in 2005 ... * PANAMA CITY, Fla. (10/12/10)--A Florida-based credit union has opened a loan office in Mobile, Ala. Panama City, Fla.-based Tyndall FCU announced The Lending Center had opened on Oct. 4. Through the center, the more than $1 billion asset Tyndall will offer products and services such as auto loans, mortgages, home equity lines of credit, and credit cards. The credit union said the new center is Tyndall's first location in the Mobile and Baldwin County areas, but it would not be its last. The credit union plans to add multiple full-service branches in the counties soon. "The opening of this new facility is just the beginning," said Tyndall President/CEO Jim Warren. "We want to become a big part of the community and help as many people as possible save money," he added ...

Nomination for board seat arrives says CUNA

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MADISON, Wis. (10/12/10)--A sixth nomination has been received for a seat on the Credit Union National Association (CUNA) board of directors. The deadline for nominations is Oct. 22. Voting will take place from Oct. 27 through Dec. 17. The most recent nomination was for Harriet May, president/CEO of GECU, El Paso, Texas, for the District 5, Class C position. May is currently CUNA’s chairman. Nominations also have been received for:
* Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., District 1, Class D; * Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, District 4, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and * Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
* District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
Those elected will take office Feb. 28 and serve a three-year term that will expire at the adjournment of the 2014 CUNA Annual General Meeting. There is one special election: CUNA’s current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting.

N.C. sets 6.5M to insure Self-Helps small-biz loans

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DURHAM, N.C. (10/12/10)--North Carolina has set up a $6.5 million Small Business Assistance Fund to insure Self-Help CU in Durham, N.C., as it helps small businesses that might not otherwise qualify to borrow. The fund uses $1.5 million from the North Carolina legislature, plus a $5 million grant from the North Carolina Golden LEAF Foundation (The Fayetteville Observer Oct. 7). The $6.5 million will allow the fund to cover defaults, Dan Gerlach, Golden Leaf Foundation president, told the newspaper. “This enables them to take some of those loans that might be at the edge, might give them enough confidence to take the loan,” he said. Self-Help agreed to leverage the $6.5 million to lend as much as $32.5 million, Donna Flick, an underwriter at the North Carolina Rural Economic Development Center, which is administering the project for the state, told the paper. To read the article, use the link.

N.J. CUs 2Q performance exceeds national stats

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HIGHTSTOWN, N.J. (10/12/10)--The New Jersey Credit Union League released the New Jersey Credit Union Quarterly Statistics for the second quarter 2010, indicating credit unions in the state exceeded national performance benchmarks. The report is made up of statistics compiled by the Credit Union National Association. It provides an overview of the trends in New Jersey in the second quarter, such as economic growth, home prices, employment changes and the unemployment rate. It also compares averages for New Jersey credit unions with the national averages for credit unions (The Daily Exchange Oct. 11). Highlights of the report include:
* New Jersey credit union memberships increased to 1.15 million--a first-half 2010 jump of 24,000 or 4.25% (annualized). The increase follows annual declines in memberships in each of the past three years. * The state’s 2.1%, 12-month increase in total membership is noteworthy when compared with population growth trends, the league said. The U.S. Census Bureau reports a 0.4% average annual increase in New Jersey’s population during the past decade. * If sustained through year-end, the increase would be the fastest in New Jersey credit union membership since 2002, when membership rose 2.2%.

Central City CU CEO in Kenya to aid orphans

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Items donated by staff at Central City CU, Marshfield, Wis., for an orphanage in Kenya were taken personally with credit union CEO Pat Wesenberg, who was one of five U.S. members asked by the World Council of Credit Unions to visit Kenya to help lessen the impact of HIV/AIDS by helping credit unions and their communities. (Photo provided by Central City CU)
MARSHFIELD, Wis. (10/12/10)--A trip to help lessen the impact of HIV/AIDS by helping credit unions and their communities in Kenya received media attention for Central City CU, Marshfield, Wis., and the World Council of Credit Unions (WOCCU) and its fundraising arm, Worldwide Foundation for Credit Unions. Pat Wesenberg, president/CEO of the $166.2 million asset credit union, is one of only five U.S. members asked by WOCCU to help with the project, said Marshfield News-Herald (Oct. 7). The group has been in Kenya since Oct. 3 and will return home Wednesday. While in Kenya, the group worked to provide reliable food sources and education to Kenyan children. More than 3,990 credit unions serve 3.6 million members in that country. Wesenberg is working at Busia Compassionate Centre's orphanage in western Kenya, where she is helping install rain gutters, beds and mosquito netting; repairing rooftops; painting walls; assessing medical needs; and distributing books, clothes and shoes. The materials for the projects were funded by council member credit unions. Before she left, Wesenberg told the newspaper that credit unions in Kenya "really do make a big difference because otherwise people wouldn't have money to plant the crops." Kenya is a coffee and tea exporter and crops dominate its economy, the newspaper article said. Valerie Breunig, executive director of the foundation, said Wesenberg was selected from more than 100 women in 22 countries who are part of the Global Women's Leadership Network. Breunig noted that an annual foundation auction in July raised $28,000 to distribute to the orphans' scholarships and food costs on the next two Kenya trips. Others on the trip included Chrissy Cheney, wife of Credit Union National Association (CUNA) President/CEO Bill Cheney; Judy Ensweiler, wife of Texas Credit Union League President/CEO Dick Ensweiler; CUNA Chief Financial Officer Joanne Duncan; and Dr. Bernard Micke.

REAL Solutions Illinois talks savings immigrant outreach

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NAPERVILLE, Ill. (10/11/10)--Partner credit unions of the Illinois REAL Solutions met at the end of September to discuss savings challenges, immigrant outreach and other topics, said the Illinois Credit Union League. REAL Solutions field coach Mark Lynch presented information about The Savings Revolution, an idea from the Filene Research Institute through its i3 teams to allow people to overhaul their financial lifestyles to save money and reduce debit. Savings Revolution has two components: a savings challenge and a savings revolution. The challenge is an event in which selected members of the credit union compete toward their defined savings and debt reduction goals, and the participants closest to or exceeding their goals wins a prize. Monitoring of the participants' progress via media interaction stimulates other members and consumers to check on their progress and prompts them to think about taking a step toward their own goals. The revolution involves a mass, nationwide implementation of setting financial goals and working toward them in concert with neighbors and fellow members. This requires networking of members and the ability to easily set their goals and monitor their progress. They also must actively share notes with their friends and neighbors who face similar challenges and see how others respond to those challenges. At the meeting, Warren Morrow, CEO of Coopera Consulting, shared information about the most effective ways to reach the Hispanic market. Coopera partnered in March with the league to help Illinois credit unions strengthen their Hispanic outreach efforts via its Hispanic Opportunity Navigator. Also discussed was a Savings Products for Low-Wealth Households Tool Kit from the REAL Solutions Impact Center. It includes examples of small savers products, reverse-tiered savings products, round-up savings products, attached savings products, prize-linked savings products, savings challenge programs, individual development accounts and other savings products. The Illinois Institute of Technology Stuart School of Business also shared information at the meeting about its Advancing Careers and Education (ACE) Program. Credit unions located near public transportation serving the school's campus in Chicago have opportunities to take on new projects with the assistance of masters degree students.

Texas league addresses Southwest Corp. transition roles

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FARMERS BRANCH, Texas (10/11/10)--Texas Credit Union League President/CEO Dick Ensweiler hosted a statewide call Thursday for credit unions to address options for moving forward in light of the conservatorship of Texas-based Southwest Corporate FCU. The key to moving forward stems largely from what the interests are of credit unions themselves, Ensweiler told a record number of CEOs attending (LoneStar Leaguer Oct. 8). Those interests will be gauged by an advisory council being formed by the Southwest Bridge Corporate. Although the bridge corporation itself cannot be recapitalized, the council will consider four options: a new charter, a credit union service organization, a merger with an existing corporate, or shuttering the corporate. Ensweiler discussed a timeline to allow credit unions to fully review their choices and noted some choices will not be fully realized until the eventual disposition of Southwest Corporate is completed. For now, the safest action for members is to keep their funds in the corporate during the transition, he said, noting that the National Credit Union Administration has advised waiting until March 2011 to allow for securitization of legacy assets. The league has requested a place on the council, which will meet to determine what option credit unions want. It also is working with other leagues to develop a consultative service to fully analyze the options available, specifically in payment systems. Ensweiler said the league will continue to be an advocate with the bridge corporate for credit unions and will remain open to options supported by the movement for the future of payment systems. "At the end of the day, we must avoid being fragmented," he told the group. "Credit unions, which are undoubtedly getting pressure from boards to make a decision, are best served by keeping their powder dry and not miss(ing) options designed to serve their needs."

Santa Fe Springs City ECU merges with Financial Partners

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SANTE FE SPRINGS and DOWNEY, Calif.(10/11/10)--Santa Fe Springs (Calif.) City Employees CU merged with Financial Partners CU in Downey, Calif., effective Sept. 30, according to the California Department of Financial Institutions (DFI). Financial Partners has nearly $709 million in assets, six branches and 52,000 members. Two other pairs of credit unions in California also have applied for mergers. The California DFI has approved one. The other still is in the filing stage. California DFI has approved a merger of Focus One Community CU in Monrovia, Calif., into First City CU, Los Angeles. UFCW #916 FCU, Redding, Calif., has applied to merge into Members 1st CU in Redding.

Vermont FCU signs WOCCU partnership with Peru CU

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SOUTH BURLINGTON, Vt. (10/11/10)--Vermont FCU in Burlington, Vt., and AELUCOOP, the second largest credit union in Peru, signed a World Council of Credit Unions (WOCCU) international partnership agreement in Burlington Thursday.
Signing a World Council of Credit Unions international partnership agreement in Burlington, Vt., on Thursday between Vermont FCU and AELUCOOP, the second largest credit union in Peru, are, from left: Joe Finnigan, Vermont FCU treasurer; Bernie Isabelle, Vermont FCU president/CEO; Joe Bergeron, president of the Association of Vermont Credit Unions; Pedro Miyasato, Peru Credit union (AELUCOOP) board chair; and Manuel Rabines, president of FENACREP--the Peru credit union association. (Photo provided by the Association of Vermont Credit Unions)
The credit unions were assisted by the Association of Vermont Credit Unions (AVCU) and the Federacion Nacional de Cooperativas de Ahorro y Credito del Peru (FENACREP). The signing creates the second such partnership between Vermont and Peru credit unions, said AVCU (Newslines Express Oct. 8). AELUCOOP Board Chairman Pedro Miyasato and Manuel Rabines, FENACREP president, spent Thursday meeting with Vermont FCU managers and staff at the credit union’s Burlington and South Burlington offices. They learned the history of the credit union from President/CEO Bernie Isabelle, and received overviews of Vermont FCU’s balance sheet from Vice President of Finance Jean Giard and of deposit and loan products from Vice President of Lending Lisa Randall. Lance Potter, the credit union’s vice president of information systems; Lori Crowley, assistant vice president of marketing; and Patrick Reeves, deposit operations manager, also provided information about Vermont FCU and interacted with the visitors throughout the day. WOCCU’s Tom Belekevich provided translation services. AVCU President Joe Bergeron and Rabines facilitated the signing of the international partnership agreement by representatives of the two credit unions. Isabelle said both financial institutions, and their respective trade associations and fellow member credit unions, will continue to benefit from the cooperation that the WOCCU program fosters. “These international partnerships are another example of the collaborative spirit and efforts that have become commonplace in the credit union movement,” Isabelle said. “The information disseminated and the friendships developed in these arrangements will help us all in our ultimate goal of serving our members. These partnerships also reinforce the worldwide credit union concept of ‘people helping people’ which will further differentiate us from the ‘for profit’ institutions in our respective marketplaces.”

EECU to get juntos flag on ICU Day

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DALLAS (10/11/10)--EECU, Fort Worth, Texas, has earned a Juntos Avanzamos, or “Together We Advance” designation. The Texas Credit Union League will present the credit union with a newly redesigned Juntos Avanzamos flag on Oct. 21--International Credit Union (ICU) Day. To be eligible for the designation, EECU completed an application process and documentation that it serves the Hispanic community in Fort Worth in a comfortable environment. EECU has $1.1 billion in assets. ICU Day is an annual worldwide celebration of the credit union movement on the third Thursday of October. This year’s theme, “Local. Trusted. Serving You,” focuses on credit unions’ trusted, community-focused approach to member service, said the World Council of Credit Unions (WOCCU). In the U.S., cooperatives celebrate Co-op Month in October. For the first time, the National Cooperative Business Association and its cooperatives will join credit unions and Canadian co-ops to share a common theme and graphics. In Canada, ICU Day coincides with the country’s Co-op Week, Oct. 17-23.

Southeastern CUs add 615M in assets 2Q

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TALLAHASSEE, Fla. (10/11/10)--Second-quarter statistics indicate credit unions in Alabama and Florida added $615 million in assets, providing members in the Southeast evidence of the value of credit unions, said the League of Southeastern Credit Unions (LSCU). This represents five straight years of collective growth in assets. Credit unions’ assets in Alabama grew at a 4% rate, which is double the national credit union average. The net worth ratio for Southeastern credit unions remains very healthy, the league said, with Alabama credit unions’ net worth ratio at 11%, while Florida credit unions’ net worth ratio is 9%. The industry standard for a well-capitalized financial institution is 7%. Florida credit unions added 25,000 members in the first two quarters this year. They have seen positive member growth for three straight quarters. Southeastern credit unions also are seeing their loan delinquencies drop. Alabama’s delinquencies are 0.5% below the national credit union average, and net charge-offs have fallen to their lowest level in three quarters. Florida’s credit unions also experienced drops in loan delinquencies and net charge-offs for the first time in two years. This shows credit unions in the Southeast are turning the corner from the economic downturn of the past few years, the league said. “The challenges facing credit unions in Alabama and Florida have been steep with the high unemployment rates in both states and the depressed housing market in Florida,” said LSCU President/CEO Patrick La Pine. “Credit unions’ philosophy centers on helping people. The second-quarter statistics show that credit unions are working with members to keep them in their homes and to make payments on their loans. This will help position the member for long-term financial success.” While more credit union members are paying off debt, many in Alabama and Florida continue to save. Alabama credit unions recorded savings growth of nearly 1% greater than the national credit union average. Florida credit union member savings also has been positive for the past four quarters. Even with a tight credit market, Southeastern credit unions are maintaining loan portfolio numbers. New-, used- and first-mortgage loans have remained steady the past four quarters, the league said.

Elections important to CUs--Minn. network article

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ST. PAUL, Minn. (10/11/10)--Minnesota Credit Union Network (MnCUN) President/CEO Mark D. Cummins encouraged consumers to vote in the Nov. 2 elections in an article, "Elections important for credit unions--and consumers," in Friday's Finance & Commerce. Minnesota has led the nation in highest voter turnout for the past decade, said MnCUN. In his monthly column in the Twin Cities financial publication, Cummins reminded readers that legislators make decisions every day "that impact the environment, local schools, taxes, health care and financial institutions--like your hometown credit union. "As not-for-profit, cooperative financial institutions, credit unions do not have bottomless coffers to influence the political process," he wrote. "But what we do have is strong grassroots support from Minnesota citizens who feel passionate about their member-owned credit union." Throughout the year, Minnesota credit union professionals and volunteers cultivate relationships with elected officials through regular meetings and campaign volunteerism, he said. Credit union activists have the fundamental goal of ensuring that politicians support credit unions and understand the credit union difference, he wrote. "With more than 1.5 million credit union members in the state, this group of individuals has the capability to shape any election," Cummins said, encouraging participation in the 2010 election cycle. Use the link to access the column.

CUs in Indiana receive league awards

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INDIANAPOLIS (10/11/10)--The Indiana Credit Union League honored credit unions for their community service, credit union philosophy in action and excellence in youth financial literacy with several awards. Winners of the Dora Maxwell Award for Social Responsibility in their asset categories were:
* Evansville (Ind.) FCU, $20 million to $50 million in assets; * Heritage FCU, Newburgh, $200 million to $500 million in assets; and * Indiana Members CU, Indianapolis, $500 million or more.
The Louise Herring Award for Credit Union Philosophy in Action went to:
* Indiana State University FCU, Terre Haute, $50 million to $250 million in assets; and * FORUM CU, Fishers, $250 million or more in assets.
Winners of the Desjardins Award for Excellence in Youth Financial Literacy were:
* First Trust CU, Michigan City, $50 million to $150 million in assets; and * Finance Center FCU, Indianapolis, $150 million to $500 million.

Indiana league elects new directors officers

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INDIANAPOLIS (10/11/10)--The Indiana Credit Union League board elected table officers at its reorganization meeting Sept. 24. The meeting was held during the league’s annual meeting and convention. Table officers include:
* Chairman--Ron Mazur, Chiphone FCU, Elkhart; * Vice chairman--Lori Dauksas, Members Choice FCU, Bloomington; * Secretary--Frank Gulley, Afena FCU, Marion; and * Treasurer--Dave Fleming, Partners 1st FCU, Fort Wayne.
Jack Sheets, president, Interra CU in Goshen, was elected to a three-year term on the board. Leaving the board at the conclusion of the annual meeting was Sandy Heller, president, Northern Indiana FCU in Merrillville. Other board members are:
* Randy Glassburn, Ball State FCU, Muncie; * George McNichols, Hoosier Hills CU, Bedford; * Lamoura Munse, Indiana Members CU, Indianapolis; and * Doug True, FORUM CU, Fishers.

West. CUNA Management School board members announced

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ONTARIO, Calif. (10/11/10)--The Western CUNA Management School (WCMS) has announced four new members on its Board of Trustees. They are:
* Incoming California and Nevada Credit Union Leagues President/CEO Diana Dykstra; * SchoolsFirst FCU CEO Rudy Hanley; * Addison Avenue FCU CEO Benson Porter; and * Credit Union Association of Oregon President/CEO Troy Stang.
Dykstra, currently CEO of San Francisco Fire CU, will begin her new role at the leagues on Oct. 18. She previously was CEO of CoastHills FCU, Lompoc, Calif.; served as a senior vice president at Patelco CU, San Francisco; and worked for The Golden 1 CU, Sacramento. She helped develop a prototype that later become the Credit Union Direct Lending (CUDL) program. She is a 1992 graduate and current instructor at WCMS, and is a recipient of the James D. Likens Alumni Recognition Award. Prior to joining the Santa Ana, Calif-based SchoolsFirst FCU (the former Orange County Teachers FCU) in 1982, Hanley worked for the California Credit Union League and the Washington, D.C. office of the Credit Union National Association (CUNA). Hanley is a member of, and has served on, numerous boards and committees. Before Porter joined Palo Alto, Calif.-based Addison Avenue FCU, he served as executive vice president and chief administrative officer at Washington Mutual Bank. He also has held management positions with Key Bank of Washington, the Washington State Senate Banking Committee, and the Washington State financial institutions regulator. Stang served under the U.S. Treasury Cabinet Secretary as a senior advisor for public and legislative affairs. Prior to that, he served as the vice president of the Texas Credit Union League, developing and implementing the league's public policy agenda. WCMS is sponsored by the leagues of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming in cooperation with Pomona College in Claremont, Calif. Graduates who have developed their skills and knowledge at the school occupy positions of leadership and responsibility at some of the nation’s leading credit unions.

CU System briefs (10/07/2010)

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* BEAVERTON, Ore. (10/8/10)--The Credit Union Association of Oregon (CUAO) is supporting State Treasurer Ted Wheeler in his bid for election to the post. He was appointed to the position by Gov. Ted Kulongoski after the death of Ben Westlund in March. Pam Leavitt, CUAO vice president for governmental affairs, said the board was impressed with Wheeler's "interest in our issues and his understanding of the credit union movement." "Our board believes Treasurer Wheeler has a strong understanding of the financial marketplace and the role that credit unions play in it." Wheeler supported increasing financial literacy among the state's students, and CUAO is an advocate for legislation to increase financial literacy in the state's public school system. He also said he would be diligent in seeing that a public funds bill passed by the last legislature would be implemented in a manner consistent with the legislation's intent. Leavitt also praised Wheeler's opponent, State Sen. Chris Telfer, who has knowledge on key issues as a result of her career as a certified public accountant. Telfer is in the middle of a four-year term on the Senate ... * SOUTH BEND, Ind. (10/8/10)--A South Bend man was sentenced to 12 years in prison for robbing a branch of Teachers CU (TCU) in December. Dion Davis, 26, pleaded guilty in a U.S. District Court to aggravated bank robbery and brandishing a firearm during a crime of violence. Davis and two masked accomplices accosted a TCU employee arriving at work on Dec. 7. They pointed a gun at her and she led them into the credit union, where another employee was at work. The three robbers pointed the gun in each employee's face, ordered both to the floor and threatened to kill them before escaping with more than $65,000. Davis also is serving a four-year prison sentence for a 2008 burglary conviction. The sentences will run at the same time as the state burglary sentence. Two others, Armand White, 23, and Tremaine Grant, 26, pleaded guilty. White was sentenced to 10 years in prison, and Grant's sentencing is set for Nov. 23 (South Bend Tribune Oct. 5) ... * SPRINGFIELD, Ill. (10/8/10)--A Decatur, Ill., real estate broker, a real estate appraiser and a former credit union loan officer have been charged with nine counts each of mail fraud related to a real estate "flipping" scheme that defrauded Decatur-based Staley CU and area real estate buyers. The frauds occurred from 2002 to July 2005, said the Springfield, Ill, division of the Federal Bureau of Investigation. The broker, Terry Hart, 58, was convicted last week by federal jury on all nine counts. Diane Shelton, 62, the former loan officer, and Mark Brown, 45, of Moweaqua, Ill., the former appraiser, have pleaded guilty and will be sentenced Nov. 12. They allegedly participated in at least 40 fraudulent real estate and financing transactions totaling more than $3 million, creating a potential $1 million loss to the credit union, said the FBI in a press release. Each offense carries a maximum penalty of up to 30 years in prison and a $1 million fine ...

CU provides service to underserved

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RANCHO CUCAMONGA, Calif. (10/8/10)--Express CU of Seattle, Wash., has deployed four community service representatives (CMSR) to 12 local non-profit organizations to offer better access to financial services to the underserved. The nearly $10 million asset credit union is one of many continuing to provide services ranging from low-interest loans to financial literacy programs during a prolonged recession that left a growing segment of the U.S. population financially underserved. Express CU's CMSR program serves organizations dedicated to helping the homeless and entrepreneurs seeking to start businesses in financially distressed areas. "We want to offer people smarter options when it comes to managing their money," said Norma Hernandez, president/CEO of Express CU. "We have doubled our membership in the year since we initiated this program, with 40% of the new members signing up through our CMSRs. During the CMSRs' on-site office hours, visitors to the non-profits can open accounts, deposit checks, apply for loans and discuss financial matters. The CMSRs provide basic financial education and referrals to formal programs offered through their non-profit partners. Since cash transactions are not supported at the non-profit locations, the credit union teamed up with CO-OP Financial Services to offer ATM access and shared branching locations. As a result, Express CU now provides members access to more than 150 ATMs in Seattle, 1,000 in Washington and 28,000 nationwide, 9,000 of which access deposits. "About 90% of our new members would not be able to use our services without the convenient access they have to ATMs and branches provided by CO-OP Network and CO-OP Shared Branching," said Hernandez. About 25.6% of American households don't have a checking or savings account, according to the Federal Deposit Insurance Corp. The underserved includes the poor, the young, non-English speakers and small business owners who can't get loans despite creditworthiness.

Consumer bankruptcy filings up 11

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ALEXANDRIA, Va. (10/8/10)--U.S. consumer bankruptcy filings went up 11% during the first nine months of 2010 over the same period a year ago, announced the American Bankruptcy Institute (ABI). ABI clocked more than 1.165 million bankruptcies nationwide, compared with 1.046 million for the period in 2009. It was the highest total since 2005, when Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCAP), said ABI in a press release. "While the 2005 bankruptcy overhaul law aimed to reduce filings, overall consumer debt and continued financial stress have led to consumer bankruptcies climbing back to pre-BAPCAP levels," said Samuel J. Gerdano, ABA executive director. "We expect that there will be nearly 1.6 million new bankruptcy filings by year end." Overall September filings totaled 130,329--4.4% more than the 124,790 recorded filings in September 2009. The September total represents a 3.3% increase from August's filings, which totaled 127,028. Chapter 13 filings constituted 30% of all consumer cases in September, a slight increase from August, said ABI. The institute relied on data from the National Bankruptcy Research Center.

Community CU of the Year honors announced

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MADISON, Wis. (10/8/10)--Four credit unions were awarded CUNA Community Credit Union of the Year honors at the CUNA Community Credit Union & Growth Conference this week in Boston. Receiving first-place honors were:
* Latino Community CU, Durham, N.C., under $250 million in assets; and * HarborOne CU, Brockton, Mass., more than $250 million.
Merit honors were given to:
* St. Louis Community CU, under $250 million in assets; and * Rogue FCU, Medford, Ore., more than $250 million.
Community Credit Union of the Year Awards recognize and honor community credit unions that best exemplify the principles of the credit union movement while acting as a positive influence in the field of service. The distinction is reserved for community credit unions and/or multi select employee group credit unions that consistently excel in the advancing of the ideals of the credit union movement, are proactive in their community, and provide services for their diverse communities. The conference, which began Wednesday, ends Saturday.

WSJ Compliance costs have tripled for small FIs

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NEW YORK (10/8/10)--Regulatory compliance costs have tripled for small financial institutions, including credit unions, with the new financial overhaul law encompassed in the Dodd-Frank Act, The Wall Street Journal said Thursday. “In the aftermath of the financial crisis and the bailouts, the banking industry has become more polarized,” wrote David Weidner in an article titled, “Too Small to Fail; Banks Can Drive an Economic Recovery. No, Not Those Banks.” “Four banks control a combined $7.34 trillion in assets and $3.57 trillion in deposits--56% and 39% of all U.S. assets and deposits respectively, according to SNL Financial. “The rest is scattered about nearly 7,800 banks and nearly as many credit unions,” Weidner added. “Yet, those roughly 15,000 institutions must succumb to the bulk of the Dodd-Frank Act’s changes. Compliance costs have tripled for those smaller banks, according to Louis Hernandez Jr., CEO of Open Solutions Inc., a bank technology-consulting firm.” Hernandez argues against the old saws of bigger-is-better banking, in his new book, “Too Small To Fail: How the Financial Industry Crisis Changed the World’s Perceptions,” Weidner wrote. “Small banks, despite the 829 banks on the Federal Deposit Insurance Corp.’s problem bank list, are generally in good shape even though the vast majority of them didn't ask, take or qualify for bailout funds,” he added. A diminishing number of banks servicing small communities is hitting the West and Northeast areas of the U.S. especially hard. Community banks there control only 11% of assets, according to the Community Bankers Association. In those regions, a paucity of competition or incentive in lending is holding back growth, Weidner wrote. Therefore, small businesses and individuals in those regions have to depend on national and regional banks for credit, he added. Although large banks may be lending more, “the one-size-fits-all credit standards employed by national banks remains a high hurdle for many borrowers,” Weidner wrote. “We are stuck in a world where big banks set the course for the industry, and the smaller banks are forced to pay the price for their transgressions. Yes, the banking industry has changed since the financial crisis. It has become bigger and less competitive,” Weidner concluded. Credit unions want to raise their member business lending cap to 27.5% of total assets from the current level of 12.25%. CUNA statistics show that would inject $10 billion in new funding into the economy and create as many as 100,000 new jobs, at no cost to taxpayers.

Massive gas leak temporarily closes CU

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SOUTH BEND, Ind. (10/8/10)--A massive gas leak Thursday in downtown South Bend, Ind., temporarily closed more than a dozen businesses, including the main office of Teachers CU. Teachers CU CEO Richard Rice said that he was leaving the credit union to attend a meeting at 8:30 a.m. Thursday when he heard sirens. Rice said he often hears sirens in the area around the credit union, usually because of false alarms. However, the fire department was responding to a gas leak that occurred at a construction site about a block from Teachers CU. “You could smell the gas,” Rice said. The local police and fire departments used buses to evacuate everyone in the downtown area and took them to the University of Notre Dame. The leak closed all businesses downtown, including the County-City Building and the courthouse. Teachers CU was impacted by the evacuation, so the credit union shut down its main operations and switched to an offsite backup computer system to run its 45 other branches. A credit union helpline and call center also were switched from the main office to other branches, and tellers working at the downtown location were dispersed to other brances. At 1:30 p.m., Teachers CU was re-opened its offices after the gas leak was capped. “I give the city of South Bend kudos,” Rice said. “[The evacuation] was not haphazard. The fire department and police department handled it, and they had a good disaster recovery system.” Teachers CU has $1.9 billion in assets.

CUNA Board nomination submitted deadline Oct. 22

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MADISON, Wis. (10/8/10)--A fifth nomination has been received for a seat on the Credit Union National Association (CUNA) board of directors. The deadline for nominations is Oct. 22. Voting will take place from Oct. 27 through Dec. 17. The latest nomination was for Paul Gentile, president/CEO, New Jersey Credit Union League, Hightstown, N.J., for a District 1, Class D seat. Nominations also have been received for:
* Ed Williams, president/CEO, Discovery FCU, Wyomissing, Pa., for District 1, Class A; * Patricia A. Wesenberg, governmental affairs liaison, Marshfield (Wis.) Medical Center CU, District 4, Class A; * Wendell Lyons, president/CEO of the Kentucky Credit Union League, District 2, Class D; and *Maurice Smith, CEO, Local Government FCU, Raleigh, N.C., District 3, Class C.
Positions up for election are:
*District 1, Class A; * District 1, Class D; * District 2, Class B; * District 2, Class D; * District 3, Class C; * District 4, Class A; * District 5, Class C; and * District 6, Class B.
Those elected will take office Feb. 28 and serve a three-year term that will expire at the adjournment of the 2014 CUNA Annual General Meeting. There is one special election: CUNA’s current District 6, Class C director will step down from the board at the end of this year. The successful candidate in that election will be seated Jan. 1 and serve through the 2012 CUNA Annual General Meeting.

CUNA Mutual updates CUs on risk management

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MADISON, Wis. (10/8/10)--Representatives from more than 50 Wisconsin and Illinois credit unions met at CUNA Mutual Group Sept. 30 to discuss the latest emerging fraud exposures, robbery prevention tips from local law enforcement and best practices for fraud prevention. CUNA Mutual’s Risk Management Department hosted the half-day meeting to help credit unions understand and manage the most prominent, costly and growing risks and to provide executive-level guidance for key steps in managing those risks, said Brad Mundine, CUNA Mutual regional manager of risk management. “Regulatory and legislative dynamics combined with pervasive economic forces have redefined the boundaries of credit unions' risk exposures in 2010,” Mundine said. “Credit unions are facing new and changing risks from just about every direction imaginable.” “The power of collaboration can't be overstated in today's rapidly changing fraud environment,” he added. “Today's meeting called attention to several significant threats credit unions face and the resources available to manage those risks.” The free event was held exclusively for CUNA Mutual Bond policyholders. It featured four speakers, including:
* Julie Walser, manager of loss prevention at UW CU, Madison, Wis., who provided an overview of its Loss Prevention team and discussed shared incentive programs to increase employee awareness of deposit fraud. She also discussed system tools the credit union has developed to identify and control credit card fraud. * Brad Jobe, CUNA Mutual director of information technology, who focused on system intrusions, the impact they can have on credit unions and members, and shared resources to assist in blocking intrusions. * Frank Chandler, crime prevention officer with the Madison (Wis.) Police Department, who discussed robbery prevention tips for credit unions including the use of “No Hats, No Hoods, No Sunglasses,” proper surveillance for a credit union and post-robbery actions that should be taken. * Ann Davidson, CUNA Mutual risk manager, who discussed the biggest fraud threats facing credit unions in 2010.

Three CUs receive Tech Councils Best Practices awards

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MADISON, Wis. (10/8/10)--Affinity Plus FCU, Travis CU and Envision CU were honored as winners of the 2010 CUNA Technology Council Best Practices Awards at the Council’s 15th Annual Conference, Sept. 29-Oct. 2 in Las Vegas.
Click to view larger image Affinity Plus FCU, Travis CU and Envision CU won Best Practices Awards during the CUNA Technology Council’s annual conference. From left: Keith Malbrue, chief operation officers and Cary Tonne, vice president of information technology, Affinity FCU; Craig Beaudry, associate vice president of information technology development and operations, Travis CU; and Tyrell Baker, associate vice president of information technology, Envision CU. (Photo provided by the Credit Union National Association)
The council award recognizes outstanding approaches to technology challenges, with potential for universal application across the credit union movement, in four major categories. Affinity Plus FCU in St. Paul, Minn., won in the information security/privacy for their automated SAFE (System Access for Employees) process, which reduced the SAFE process time to completion from days to hours. In the member service/convenience category, Travis CU in Vacaville, Calif., won for its integration of a complete application foundation for the credit union, meeting the needs of each business area. This included leveraging Oracle’s Fusion Middleware in the areas of data warehouse and business intelligence, enterprise content management and business process management. Envision CU, Tallahassee, Fla., won in the miscellaneous category for developing tools to supplement customizable software applications’ base functionality for the CU’s specific needs. Affinity Plus FCU also received a miscellaneous award for its automated in-house statement solution, which automated the deployment of all statement and notice files from one system to another for printing.

New Jersey league awards CUs leaders

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HIGHTSTOWN, N.J. (10/7/10)--The New Jersey Credit Union League presented its awards to outstanding credit unions and leaders during its 76th Annual Meeting and Convention last weekend in Atlantic City (The Daily Exchange Oct. 6). The Desjardins Youth Financial Education Award, was presented to Raritan Bay FCU, Sayreville, for its high school branch program. The Louise Herring Award for Philosophy in Action was awarded to Jersey Shore FCU, Northfield, for its Young Member Clubs Recipients in their asset and multi-credit union/chapter categories of Dora Maxwell Social Responsibility Recognition Awards included:
* Hamilton Horizons FCU, Hamilton, for its Turnpike Series, which raised funds for Children's Miracle Network; * Jersey Shore FCU, for its 5K in May fundraiser for pancreatic cancer research; and * Mid-State FCU, Carteret; NJ Gateway FCU, Monmouth Junction; Local 1233 FCU, Newark; and New Community FCU, Newark, for their pilot of the Building Economic Strength Together (BEST) Program.
A new award, the Miller/Kosobucki Marketing Award, went to Elizabeth NJ Firemen's FCU, Elizabeth, for its newsletters (under $10 million assets category) and First Financial FCU, Wall, for its Win with First PURL campaign (over $25 million assets category). The league also recognized:
* Gary Chizmadia of the Credit Union of New Jersey, Ewing, as Volunteer of the Year; * Robert Carabelli, marketing coordinator at McGraw-Hill FCU, East Windsor, named as Difference Maker of the Year for dedication to the credit union's mission and his member-focused work ethic; * Lou Vetere, CEO of Garden Savings FCU, Parsippany, and a league board member, as CEO of the Year; and * North Jersey FCU, as Credit Union of the Year for its innovation, member-centric service and growth during the economic downturn.

CU CEO Confidence Index drops 9.76 points for 3Q

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PLANO, Texas (10/7/10)--Credit union CEOs' confidence level dropped 9.76 percentage points--to 10.97--during third quarter, according to the Southwest Corporate FCU's CEO Confidence Index, posted on its website. The index for credit union CEOs' confidence overall declined from 20.73 in second quarter and from 29.01 for third-quarter 2009. It was the second lowest overall confidence rating since 2004. The lowest was in first quarter 2009 at the height of the global financial crisis. The third quarter report arrives on the heels of corporate restructuring actions--including conservatorships of three corporate credit unions and assessments to replenish the National Credit Union Share Insurance Fund--taken in the past three weeks by the National Credit Union Administration. The index compared CEOs' current confidence level in members' financial condition and their confidence in members' condition in six months, as well as their confidence in credit unions' financial condition for both periods. For members' condition, the confidence level for third quarter dropped to -2 from about 30 in second quarter and about 12 in third quarter last year. Expectations for members' financial condition in six months were higher, at slightly above 10. The confidence level for credit unions' financial condition stayed largely steady--at about 19--from second quarter. That was down from about 35 in third quarter last year. CEOs' confidence for six months in the future followed the same pattern, but around 25. CEOs' current expectations for share deposit growth, which peaked in first quarter at nearly 40 fell to 30 at the end of second quarter. Expectations for loan demand stayed steady after plunging from above 20 during third quarter 2009 to about 1% in first quarter 2010, where it has remained since. The CEOs' level of confidence varied widely by region and by credit union asset size. Those with the lowest confidence were in the Western (-30) and Mid-Atlantic (-25) states, while the Midwest (4.17) had the highest level of confidence. The only asset category with a positive confidence level was for CEOs from $2 million to $10 million asset credit unions; their confidence level was 6.52. All other asset groups registered in negative numbers, with credit unions of less than $2 million in asset size the most pessimistic, at -12.5.

Elevations donates 81K to Fourmile fire relief

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BOULDER, Colo. (10/7/10)--The Elevations Foundation has distributed $81,000 from its Fourmile Fire Relief Fund. The fund was established Sept. 8 and will help victims and local firefighting agencies. A wildfire burning early in September in the steep mountainsides and canyons near Boulder, Colo., became the most destructive fire in the state’s history (Associated Press Sept. 8). Many homes were destroyed by the 6,200 acre fire, and at least 3,500 people were evacuated. Elevations, which is the charitable arm of Boulder-based Elevations CU, is working with Boulder County Community Services, the Foothills United Way and the Community Foundation Serving Boulder County to distribute the funds. “These organizations have worked tirelessly to see that victims are identified and needs are being met,” said Dennis Paul, Elevations assistant vice president for business and community development. The foundation’s fund provides a source of cash resources, he said. Elevations also established a fire relief fund for the Reservoir Road fire west of Loveland, Colo. Elevations is working with the United Way of Larimer County to distribute funds for families affected in the Loveland area.

Ohio CUs host Romanias FEDCAR CEO

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COLUMBUS, Ohio (10/7/10)--The Ohio Credit Union League (OCUL) and several Ohio credit unions recently hosted Florin Simion, CEO of the Federation of Romanian Credit Unions (FEDCAR), to discuss a partnership to help stimulate credit union growth in Romania, and further develop the federation into an all-encompassing credit union support organization. Simion began his Ohio agenda with a dialogue at OCUL’s office in Columbus. Discussion focused on the types of services the league provides to its members and its role in developing credit unions. “Though we are separated by thousands of miles, our goals and obstacles are very similar,” said Paul Mercer, league president. “Our league definitely has a better understanding of the unique challenges faced by credit unions under a different government structure, and I hope in return we presented ideas and strategies that will strengthen the credit union movement in Romania.” Simion also visited three Ohio credit unions: CES CU in Mount Vernon, Healthcare FCU in Columbus, and Cincinnati Central CU. Each provided knowledge of U.S. credit union operations and the issues they face. To learn more about the corporate credit union structure, Simion visited Corporate One FCU in Columbus. The league’s partnership with Romania is part of the World Council of Credit Unions’ (WOCCU) International Partnerships Program. “These partnerships are essential to our mission as credit unions, and are a key factor in the credit union difference,” said Bill Herring, CEO of Cincinnati Central. “Ohio credit unions have a long-standing record of cooperation among cooperatives, and this is a great way to continue that tradition.” FEDCAR was formed in 2004, two years after WOCCU’s project to strengthen Romanian credit unions ended. The federation began with seven credit unions totaling 8,000 members and has since grown to 17 credit unions with 72,000 members. Credit unions in Romania operate solely as basic savings and loan institutions, which limits their growth opportunities. FEDCAR approached WOCCU for assistance in finding an international partner to help create new opportunities for its credit unions. WOCCU recommended the Ohio league and affiliated credit unions because of their past partnerships with credit unions in Bulgaria and Bolivia. “This partnership is important for FEDCAR and Romanian credit unions as it represents our cooperative roots and our future,” Simion said. “This is what we need to push our credit unions ahead to give them a viable future and make them better financial institutions for the benefit of the members.” FEDCAR and the league agreed to continue the partnership. They discussed a trip to Romania by an Ohio delegation in 2011.

Western states corporate task forces paper released

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ONTARIO, Calif. (10/7/10)--A Corporate Realignment Task Force created by credit union leaders in Western states has agreed on several guiding principles for dealing with recent changes in the corporate credit union system. The task force released a position paper detailing the principles, according to the California and Nevada Credit Union Leagues. The principles recognize the need for:
* A system solution. Commercial and outside organizations may wish to provide credit union item-processing and payment-system services, but many credit union leaders have expressed an enduring system solution. “A financial institution connection is needed to provide collaborative settlement and related liquidity services,” the paper said. * Aggregation of volume, which will be needed to successfully replicate the essential services that natural-person credit unions are accustomed to receiving from their corporate credit unions because the cost of these services will no longer be subsidized by investment activity. “Given likely narrow margins, it is unlikely that a multitude of solutions will see much success; competitive pressure could result in predatory activity and eventually more painful consolidation,” the paper said. * A universal solution. “Many credit union leaders, including those at larger credit unions, have expressed their hope that a system solution will emerge that provides quality, affordable service for all types and sizes of credit unions. Our strength, both politically and operationally, lies in cooperation and system unity; it is important to provide logical, affordable service opportunities for smaller and mid-sized credit unions as well as larger ones; for modest organizations as well as complex ones,” the paper said.
The task force will work toward solutions reflecting the guiding principles and urges credit union leaders to consider supporting solutions with those elements, the leagues said. The Credit Union National Association has a Corporate Credit Union Task Force, and many leagues and associations have formed similar groups after the National Credit Union Administration announced it would be placing several corporate credit unions into conservatorship last month.

Missouris only public high school CU branch opens

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ST. LOUIS (10/7/10)--Gateway Metro FCU in St. Louis and Gateway Institute of Technology celebrated the opening of the only credit union branch in a Missouri public high school.
Click to view larger image Gateway Metro FCU, St. Louis, and Gateway Institute of Technology celebrated a partnership by cutting the ribbon at the institute to open JagCity CU, the only credit union branch in a Missouri public high school. (Photo provided by Gateway Metro CU)
The branch, named “JagCity CU” by students, will open every Friday during lunch hour. Six Gateway Institute of Technology students attended training at Gateway Metro and will staff the school branch along with a credit union employee. “I’m so impressed with the level of intelligence, diversity and maturity of Gateway Institute’s student representatives,” said David Barton, Gateway Metro president/CEO. “The school’s focus on the ‘real world’ fits perfectly with the financial education component that students will receive from their member-owned credit union. No other public high school in the state can say they have their very own credit union branch in their school.” Gateway Institute of Technology Principal Elizabeth Bender commented on the historic occasion at the grand opening ceremony, as did Katrina Stierholz, assistant vice president of the Federal Reserve Bank of St. Louis. Meagan Bonnell-Yogi, business education department head at the school, coordinated setting up the branch with the credit union. “The students are so excited with the opportunity to work in and become a member of the credit union,” said Bonnell-Yogi. Gateway Metro operates the first and only elementary school student-assisted credit union branches in Missouri at Our Lady of Guadalupe School, St. Ferdinand School, and Christ, Light of the Nations School. The credit union also opened a student-assisted branch at Trinity Catholic High School in April. Gateway Metro FCU has $182.8 million in assets.

OpSS Council honors two CUs best practices

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MADISON, Wis. (10/7/10)--Two credit unions received the sixth annual CUNA Operations, Sales & Service (OpSS) Council’s Best Practices Awards, which recognize innovative solutions optimizing credit union performance. The winners were recognized during the council’s 13th annual conference, Sept. 29-Oct. 2 in Las Vegas.
Click to view larger image Olin Community CU, Bethalto, Ill., won a Best Practices Award from the CUNA Operations, Sales and Service Council (OpSS). From left are Jennifer Lehn, CUNA OpSS Council chair; Brenda Jackson, vice president of branch operations, Olin Community CU; and Steve Langley, CUNA OpSS Council Conference Committee member.
Click to view larger image Red Canoe CU received a Best Practices Award from the CUNA Operations, Sales and Service Council (OpSS) during a recent conference. From left are Jennifer Lehn, CUNA OpSS Council chair; Michelle Trekas, training specialist and Rodney Snyder, associate vice president of branches and sales, both of Canoe CU; and Steve Langley, member of CUNA OpSS Council Conference Committee. (Photos provided by CUNA)
Olin Community CU in Bethalto, Ill., won in the Sales and Service Management category for its sales and service culture. Olin’s strategy includes:
* Organization-wide training; * A comprehensive products and services manual; * Referral goals and incentives; * Coaching; * System integration; and * A monthly newsletter.
As a result of the credit union’s efforts, members increased the number of products per household they use and the credit union saw growth in membership, assets, shares (12.69%), and loan growth (8.31%). Red Canoe CU in Longview, Wash., also won in the Sales and Service Management category for its creative sales and service culture. Red Canoe’s strategy includes:
* Incentive structures; * Creative follow-up training; * Internal campaigns; * An intranet-based sales blog for managers and staff; * Quarterly management “Segway” meetings; and * Staff recognition.
Red Canoe’s closed referral ratio is 20.54%--205% of its goal. It brought in more than $7 million in competitor buyouts. The credit union also added loan protection on 59.61% of its consumer loans, exceeding its goal of 40%. Red Canoe also brought in 49% of its home equity line of credit loans, which exceeded its goal of 25%. The OpSS Council Best Practices Awards identify, recognize and share new approaches and solutions with universal application in the credit union movement. Winners were chosen, without regard to credit union asset size, based on strategy, process, application and results.

CU System briefs (10/06/2010)

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* HARRISBURG, Pa. (10/7/10)--More than 30 credit union leaders from 12 credit unions attended breakfast with U.S. Rep. Paul Kanjorski (D-Pa.) in Wilkes-Barre, Pa. Pennsylvania Credit Union Association President/CEO Jim McCormack introduced special guest Credit Union National Association President/CEO Bill Cheney, who shared the congressman's accomplishments for credit unions and thanked him for his support. Kanjorski commended Pennsylvania credit unions for their continuous commitment to bettering the welfare of members and communities. "Credit union members are our neighbors, friends and those who have fallen on hard times," Kanjorski said. "With an unfortunate economy, it's important now more than ever to stay focused and serve." McCormack said, "In his capacity as an outstanding senior member of the powerful U.S. House Financial Services Committee, Congressman Kanjorski has ensured that the best interest of credit unions are always heard and represented in Congress." He cited H.R. 1151, CURIA, and this session's member business legislation as examples (Life is a Highway Oct. 6) ... * ST. PAUL, Minn. (10/7/10)--Elizabeth Hayes, Affinity Plus FCU executive vice president and chief administration officer, was selected as one of the 2010 "Top Women in Finance." The list of 25 women, compiled by the Finance & Commerce newspaper, recognizes women making significant contributions to the financial services industry by positively influencing their businesses and communities. During her 12 years with Affinity Plus, Hayes introduced its Solutions Model, which provides delinquent members permanent solutions to their financial struggles. She was an inaugural member of the Filene Research Institute's i3 Innovation Group in 2004. Hayes also is involved in Member Gateway, a national credit union service organization that develops innovative products and services for credit unions and the financial services industry. Hayes also chairs the Affinity Plus Foundation, which promotes financial literacy throughout Minnesota. She noted the award "highlights the credit union industry in a time when people are looking for alternatives to banks. It helps increase the reputation of the industry and distinguish credit unions as viable competitors in the financial services industry" ... * SAN ANTONIO 10/7/10)--Wendi Taber, Security Service FCU senior risk management analyst, was honored with the Financial Literacy Award presented by the American Society of Women Accountants Educational Foundation. The award was presented at a joint national conference with the American Women's Society of CPAs in Las Vegas. Taber has taught financial literacy and life skills through the SAMMinistries the past four years. She is also president of the San Antonio CPA Society and a board member of the Texas Society of CPAs. Taber has assisted with the development of a financial literacy program for the American Society of Woman Accountants and helped implement the first financial literacy program for Seton Home, a residential facility that provides shelter and support for homeless teens who are pregnant or parenting ...

Connecticut league wins Desjardins award

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MERIDEN, Conn. (10/7/10)--Financial literacy efforts by the Credit Union League of Connecticut received national recognition with a Desjardins Youth Financial Education Award for the 2009-2010 school year.
Connecticut league sponsorship of financial reality fairs for high school students this past school year won a Desjardins Youth Financial Education Award. Pictured is a fair at Central Connecticut State University. (Photo provided by the Credit Union League of Connecticut)
A major component of the league's eductional work was supporting the Financial Reality Fair throughout the state. The program is for high school students, who research their career choice and starting salary prior to the fair date. They are provided with a budget worksheet identifying their career choice, and during the fair, must budget according to their salary. “As a cooperative movement that exists solely for benefit of our membership, we feel it is important to help provide guidance and professional education for them,” said Anthony Emerson, president/CEO of the Credit Union League of Connecticut. Fifty-two member credit unions were involved in eight Financial Literacy Fairs last year, with more than 1,800 students from 50 high schools attending statewide. The Financial Reality Fair was created as part of REAL Solutions, a national credit union program focused on creating opportunities for low wealth individuals. “We believe the first step needed to improve the economic environment within a family is access to information--and the earlier the better,” said Lois Kitsch, national program manager of REAL Solutions. “The Reality Fairs offered by Connecticut credit unions through their league are REAL Financial Education Solutions. Mixing fun with learning creates a memorable experience that will remain with the students in the months and years to come.” Credit unions will start fairs for the current school year in New Haven on Oct. 20. Six fairs are scheduled for the 2010-2011 school year statewide.

N.Y. CUs meet in Young Adult Outreach workshop

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ALBANY, N.Y. (10/7/10)--Representatives from 11 New York credit
Click to view larger image Credit union representatives attended a workshop in Albany, N.Y., to learn how they can tweak their programs to serve youth. From left are Jessica Herishko, Columbia-Greene FCU, Hudson; Wendy Meola, Community Resource FCU, Latham; Matt Amesbury and Adam Amesbury, St. Pius X Church FCU, Rochester; and Tiffany Smith, ACMG FCU, Solvay.
Click to view larger image The Filene Research Institute and the Credit Union Association of New York recently hosted a youth workshop for credit unions at the association’s headquarters. From left are Marcie Gallagher, Utica (N.Y.) District Telephone EFCU; Elizabeth Park, GPO FCU, New Hartford; Barb Insognia, Upstate Telco FCU, Gloversville; and Sherry Morosco, Utica District Telephone EFCU. (Photos provided by the Credit Union Association of New York)
unions participated in the Credit Union Association of New York’s Young Adult Outreach Initiative last week. During the workshop, the group explored the Generation Y market and experimented with “design thinking.” Brent Dixon, young adult adviser at the Filene Research Institute, led the discussions and activities. Participants were divided into groups and assigned different tasks. Two participants from each group completed the assigned task--such as making a sandwich or ironing a shirt--while other group members questioned their processes and reasoning. The groups then developed ideas to make their tasks better, incorporating innovation without recreating the wheel, said the association. Through the exercises, the groups learned that credit unions have great programs that need a few adjustments for youth, the association added. “Attracting young adults to our credit union is a top priority,” said Adam Amesbury, executive assistant, St. Pius X Church FCU, Rochester, N.Y. “The design thinking workshop created a platform where we could ‘iron’ out the steps to successful brainstorming and explore the evolution of bringing ideas to real life," he added. The workshop was funded by a REAL Solutions grant and offered for free by the association and Filene. It was held in Albany.

Most check fraud not single scammer--FinCENs Freis

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LAS VEGAS (10/6/10)--Although check use is declining, credit unions shouldn't think that check fraud also is decreasing. In fact, check fraud has grown into the second most common crime reported in suspicious activity reports (SARs), behind money laundering, according to an official at the U.S. Treasury's Financial Crimes Enforcement Network (FinCEN). Money laundering accounts for about half the SARs, said FinCEN Director James H. Freis Jr., in a speech before the Financial Service Centers of America Inc.'s (FiSCA) annual conference meeting in Las Vegas. Suspected check fraud incidents have accounted for more than 600,000 SAR filings since 1996. If check kiting and counterfeit checks are figured in, the number of SAR filings climbs past one million, he said. "Most check fraud activity is unlikely to involve a single instance of criminal behavior," but "often occurs as a serial or repeated activity," Freis told the group. "Criminals who commit check fraud may not stop there. Many may be involved in other illegal activities as well." Those activities include counterfeit checks, credit card fraud, identity theft, check kiting and "other." "This 'other' category really drives home how interconnected check fraud is to other crimes," Freis said. "Some of the related activities reported on a check fraud SAR include: tax evasion; account takeover; ACH fraud, internet and lottery scams; stolen/forged checks; and ATM fraud." He also noted activity can include organized criminal activity--such as narcotics trafficking, trade-based money laundering and terrorist financing. Of the nearly 49,000 SARs filed so far this year by depository institutions reflecting "check fraud," the average suspicious activity amount was for $766,270 and the average loss amount was for $18,836. "The amount is reflective not of an individual fraudulent check, but rather the total related activity," he said. "The point is while several institutions see relatively small amounts lost to fraud, when they share information, a different picture emerges. What may look like a small-time scammer could be in actuality a criminal enterprise that has pulled down millions because the activity is spread across a number of financial institutions, each of whom can't see enough to connect the dots," he told the group. FinCEN, working to analyze suspicious activity reports (SARs) with law enforcement, can paint a more complete picture, he said. Freis noted that FinCEN posed the question, "Should cash checkers be required to file SARs," for public comment in May 2009. FiSCA said it supports encouraging voluntary filings by check casher but did not support a mandatory check casher SAR requirement. "FiSCA's concerns were that a mandatory check casher SAR requirement might result in a large number of reports to FinCEN with little or no benefit to the Bank Secrecy Act goals of curbing money laundering or terrorist financing," he said. He noted that SARs filed by check cashers would provide "lead information you would wish law enforcement to follow up on--individuals trying to take advantage of your business and customers you serve." He cited a 2009 American Bankers Association Deposit Account Fraud Survey, which estimated industry check-related losses totaled $1.024 billion in 2008, up from $969 million in 2006. It was the first time the survey had passed the $1 billion amount. About 80% of banks continued to report check fraud losses in 2008, the same percentage as in 2006, he said. Technology also has created new opportunities for fraud, Freis said. For example, digital scanners and mobile devices fail to capture many of the protections--such as magnetic ink character recognition (MICR) encoding, indelible inks, microprinting and watermarks--developed to mitigate check fraud and counterfeiting. He urged financial institutions to "anticipate such risks as they develop new products."

Loan-to-savings ratio drop hurts CU performance

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MADISON, Wis. (10/6/10)--The loan-to-savings ratio in August is pulling down credit unions’ financial performance, according to a Credit Union National Association (CUNA) economist’s analysis of CUNA’s monthly review of credit unions. “An increase in loans and a decrease in savings pushed the loan-to-savings ratio back above 73% in August, but down from 78% in August 2009,” Steve Rick, CUNA senior economist, told News Now. “This drop in the loan-to-savings ratio is placing downward pressure on credit unions’ asset yields and net interest margins.”
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Credit union loans outstanding increased 0.3% during August, compared with a decrease of 0.1% during July. Used-auto loans led loan growth, rising 1%, followed by unsecured personal loans and credit card loans, which went up 0.8% and 0.7%, respectively. Fixed-rate mortgages went up 0.5%, and adjustable-rate mortgages grew 0.4%. Home equity loans increased 0.3% while new-auto loans decreased 1.3%. Credit union loans in August totaled $582.6 billion, compared with $590 billion in August 2009. “Credit union loan balances rose 0.3% in August, the fastest pace since August 2009 when balances rose 0.6%,” Rick said. “Loan balances declined 0.8% during the first eight months of 2010, a complete turnaround from the 1.6% rise during the similar time period in 2009. Credit unions charging off and members paying off loan balances are the two main factors driving this result. Credit card, unsecured-personal and new-auto loan balances are down 0.2%, 1.1%, and 12% so far this year. “Credit union loan balances are expected to rise 4% in 2011 due to a strengthening economy, pent up demand for consumer durables, lower loan charge-offs and a rise in new-auto sales,” he added.
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Credit union savings balances decreased 0.7% in August, compared with a 0.7% increase during July. Individual retirement accounts led savings growth, rising 0.2%. One-year certificates and money market accounts each dropped 0.2%. Regular shares and share drafts fell 0.5% and 4.5%, respectively. Credit union savings in August totaled $795.1 billion--or $39.7 billion more than the $755.4 billion saved in August 2009. “Credit union savings balances fell in August by 0.7%--mainly because the month ended on a Thursday--a day before the Friday payday and a surge of payroll funds,” Rick said. “During the past year, credit union savings balances are up 5.3%, below the 9.4% recorded in the year ending August 2009. Members appear to be using any excess funds to pay down high-rate consumer debt, rather than placing funds in low-rate savings products.” Regarding asset quality, credit unions’ 60-plus-day delinquencies decreased slightly to 1.7% during August. The loan-to-savings ratio remained at 73% in August. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--decreased slightly to 18%. The movement’s overall capital-to-asset ratio remained at 10% in August. The total dollar amount of capital for credit unions is $92 billion.

MidWest Financial members OK merger with DFCU Financial

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ANN ARBOR, Mich. (10/6/10)--MidWest Financial CU members have officially approved a merger of their Ann Arbor, Mich.-based credit union with Dearborn, Mich.-based DFCU Financial--the state’s biggest credit union by total assets. First announced in June, the merger was approved by 92% of MidWest Financial members who voted ( Oct. 4). DFCU has $3 billion in assets, more than 219,000 members and 530 employees. MidWest Financial had roughly $177 million in assets, nearly 18,000 members, four branches and 70 employees. DFCU is expected to keep MidWest’s employees as DFCU enters the Ann Arbor market, the website said.

Southwest Corporate forming advisory council

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FARMERS BRANCH, Texas (10/6/10)--Texas-based Southwest Corporate FCU said Tuesday it will form an advisory council made up of credit union leaders to advise it on its future. More than 100 credit union representatives have already volunteered to serve on it, and members can still sign up, the corporate said. Nearly 450 credit union representatives attended the corporate's webinar, held Thursday, which introduced new CEO Dianne Addington and the corporate's new direction (eFacts Oct. 5). Recently retired as CEO at Michigan-based Genisys CU, Addington was appointed CEO of Southwest Corporate when it was placed into conservatorship--along with two other corporates--by the National Credit Union Administration (NCUA) on Sept. 24. Operationally, it's business as usual for Southwest Corporate. The same staff will continue to serve members, Addington told webinar participants. She also assured members that new capital will not be required during the bridge corporate status. She presented options for future business models that include:
* Purchase of corporate operations by an existing corporate; * A new corporate charter; and * Purchase of corporate operations by a credit union service organization (CUSO) or start of a new CUSO.
Addington noted it is wise to evaluate service alternatives, but she encouraged credit unions to stay with Southwest Corporate long enough to see the new plan emerge. She expressed confidence in the corporate's "efficient operations" and optimism for a viable, member-directed solution that would prevent interruption of services. "We are developing a process to receive input from everyone who wants to contribute," said Kathy Garner, executive vice president, member relations and business development, about the new council. "Much of the work already done on business models can be used by credit unions to help set the course for Southwest Corporate's future operations," she said. "We hope to provide members answers by year end." NCUA's Keith Morton urged the group to avoid fragmentation, but said that while credit unions need to start making plans for a transition, the best option is to work in a unified way, according to a report by the Texas Credit Union League (LoneStar Leaguer Oct. 4). The message was similar to that delivered by NCUA's Scott Hunt to members of Members United Corporate FCU, in another webinar last week (News Now Oct. 4). Members United was placed into conservatorship, along with Constitution Corporate FCU, on the same date as Southwest Corporate. Individuals can sign up for Southwest Corporate's advisory council until Thursday. To do so, contact Garner at

Illinois chapter leaders survive annual conference

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NAPERVILLE, Ill. (10/6/10)--More than 80 leaders from 21 of the Illinois Credit Union League’s 24 chapters “survived” this year’s annual Chapter Leaders Conference, hosted by the league and the
Click to view larger image The Illinois Credit Union League recently hosted its annual Chapter Leaders Conference, with the theme, “Strive, Survive, Thrive.” Twenty-four chapters attended the conference, which included outdoor teamwork activities. (Photo provided by the Illinois Credit Union League)
Aurora Chapter. The conference was themed, “Strive, Survive, Thrive.” During the conference, winners of the state-level Credit Union Political Action Council’s (CUPAC) annual chapter fundraising competition were recognized. Winners included:
* First place--Southern Illinois Chapter, $18,083; * Second place--George G. Burnett Chapter, $10,976; * Third place--Kankakee Valley Chapter, $10, 885; and * Honorable Mention--Thomas W. Doig Chapter, $9,256.
A silent auction also raised $1,665 at the conference. The money was donated to CUPAC and the Illinois Credit Union Foundation.

CU System briefs (10/05/2010)

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* PORTLAND, Maine (10/6/10)--Maine credit unions and Good Shepherd Food Bank Friday celebrated the beginning of National Co-op Month by
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marking the fifth anniversary of Maine's first "Food Mobile" with a $10,500 contribution. The Maine Credit Unions' Campaign for Ending Hunger has contributed more than $3.5 million to help end hunger since 1990. Also announced: the Food Mobile program has distributed more than 1.6 million pounds of food to food pantries throughout the state. From left are Rick Small, executive director, Good Shepherd Food Bank, and Jon Paradise, governmental and public affairs manager at the Maine Credit Union League. (Photo provided by the Maine Credit Union League) ... * ALBANY, N.Y. (10/6/10)-- Amy Kramer, vice president, governmental affairs at the Credit Union Association of New York, has left to work for AT&T in the company's top state legislative slot in New York State (PR Newswire Oct. 1). She will be responsible for developing strategies and plans for achieving AT&T's legislative objectives and lobbying elected officials and policymakers on a range of issues for AT&T. She also was a former Senate Fellow/Legislative Coordinator for the New York State Senate and assistant curator for the Shaker Museum & Library in Old Chatham ... * FORT WORTH, Texas (10/6/10)--The credit card program at American Airlines FCU has surpassed balances of $100 million, the Fort Worth, Texas-based credit union announced. In the past five years, the program has experienced double-digit growth annually. Nancy Crouch, director of card services for AA CU, noted that in the tough economic climate, the program "acts as a safe harbor for members, protecting them from the predatory practices common in this industry. That's one of the many reasons credit unions are thriving despite the challenges." The more than $5 billion asset credit union offers several Visa Platinum card progams and includes a points-based reward card, which is also available as a starter card. Two years ago, the credit union launched a low-rate Platinum card. The program has generated $30 million in outstanding balances ...

WOCCU redefines rules of engagement

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MADISON, Wis. (10/6/10)--Engaging credit unions and volunteers from developed countries in World Council of Credit Union (WOCCU) programs and activities is the best way to gain organizational support and reignite the credit union philosophy worldwide,
Click to view larger image At the World Council of Credit Unions’ (WOCCU) Corporate Strategic Conference in Madison, Wis., last week are (left) Barry Jolette, WOCCU chairman; Anne Cochran, WOCCU treasurer; and Greg Moser, vice president of WOCCU Services Group.
Click to view larger image Brian Branch, left, World Council of Credit Unions (WOCCU) executive vice president and chief operating officer and Pete Crear, WOCCU president/CEO, attended the WOCCU Corporate Strategic Conference in Madison, Wis. The goal of the conference is to enhance WOCCU’s capabilities. (Photos provided by the World Council of Credit Unions)
according to WOCCU’s Corporate Strategic Conference, which took place in Madison last week. “I’d like to believe that we can make a difference in peoples’ lives,” said Barry Jolette, WOCCU chair and president/CEO of San Mateo CU in Redwood City, Calif. He provided opening comments to the second-annual conference and was on hand with other representatives from U.S. credit union leagues and credit union organizations in Canada and Ireland. The purpose of the conference was to enhance WOCCU’s capabilities by including representatives from partner organizations in defining its future directions. “The purpose of this meeting is about looking analytically at ourselves, determining what we have learned and deciding where we need to go,” said Brian Branch, WOCCU executive vice president and chief operating officer. “If we focus only on what staff can do, we limit our range. But if we extend that range by reaching out to our partners, we may be able to tap unlimited possibilities.” Partner organization representatives attending included Anne Cochran, WOCCU treasurer and CEO of the Louisiana Credit Union League; Mike Lanotte, senior vice president and general counsel, Credit Union Association of New York; Murray Williams, chief operating officer, Iowa Credit Union League; Alan Moore, international development officer, Irish Credit Union League Foundation; and Derek Cameron, program officer for the Canadian Cooperative Association. Field officers from WOCCU development program in Afghanistan, Ethiopia, Haiti, Kenya, Mexico and Sri Lanka also joined staff from WOCCU’s Madison and Washington, D.C., offices. More than 40 presenters and evaluators participated. “The ability to gather staff from around the globe for an annual planning session has always been an asset for World Council,” said Pete Crear, WOCCU president/CEO. “But the opportunity to engage the expertise of partners in our global development efforts significantly extends our reach and enhances our ability to improve the lives of people worldwide through the power of credit unions.”

Nevada CUs move to beef up auto loan market share

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RENO, Nev. (10/5/10)--Nevada's credit unions are aggressively campaigning to recover the large auto lending market share they held 18 months ago, according to Northern Nevada Business Weekly (Oct. 4). In 2009 credit unions nationwide held a 22.5% share of auto loans, thanks to a growth spurt that occurred when banks and automakers' captive finance companies tightened lending. Credit unions had money to loan, Bill Meyer of CU Direct Corp., an Ontario, Calif.-based company that provides technology for auto lending at credit unions, told the publication. Today, however, those competitors have returned to auto lending, and credit unions' share declined to about 17%, said Meyer. The article describes what local Nevada credit unions are doing to attract auto loans. Greater Nevada CU, Carson City, is talking directly to consumers via media ad campaigns urging borrowers "to drive something that's a little more you." It also has developed a preferred-dealer program in which it promotes dealers to members, and members get a price break. The credit union had $65.26 million in new-car loans at midyear, plus $68.2 million in used-car loans. The combined auto loans accounted for 40% of the credit union's $337.2 million loan portfolio. Reno-based Greater Basin FCU held about $59 million in auto loans at midyear, accounting for more than two-thirds of its loan and lease portfolio. It marketed to consumers with 3.99% loans for new- or used-vehicle purchases. It's now marketing a 1% cash rebate up to $300 on new loans and refinancings. Greater Basin also scheduled a free open house Oct. 16 where members and nonmembers can learn abut auto-financing options and the car-buying process.

One card steering lawsuit settled another filed

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WASHINGTON (10/5/10)--Visa and MasterCard announced a settlement agreement Monday with the Department of Justice (DOJ) and seven states over antitrust issues in their merchant acceptance rules involving merchants' "steering" consumers to less expensive payment forms. Meanwhile, DOJ also announced it had filed a similar antitrust lawsuit Monday against American Express Co. The DOJ said in the suit filed against AmExpress that the card company's rules it imposes on merchants that accept its cards are "anticompetitive" and "impede merchants from promoting or encouraging the use of a competing credit or charge card with lower card acceptance fees" (The Wall Street Journal and PaymentsSource Oct. 4). The Visa/MasterCard settlement did not involve any admission of wrong doing. The settlement is considered by some a victory for merchants, who have complained for years about the annual fees they pay to accept and process credit cards. The lawsuit against AmEx, which was filed in the U.S. District Court for the Eastern District of New York, stems from a DOJ review begun in 2008 of payment networks' rules. Most networks prohibit merchants from taking steps to steer consumers from using one brand's card instead of another to get lower interchange rates. AmEx, in a statement, said it has no intention of settling the case because the Justice Department is suing "a party proven not to have market power." Instead, said AmEx CEO Kenneth Chenault, the government's new approach "would hand an unfair advantage back to Visa and MasterCard." Visa said that as part of the settlement, it will allow U.S. merchants to offer discounts and other incentives to steer customers to a particular form of payment, including a specific network brand or to any card product, such as a "non-reward" Visa credit card. Reward cards cost merchants more, and merchants who agree to accept a company's cards must accept all of them, said the Journal. "The new rules will expand U.S. merchants' ability to discount for their preferred form of payment, though they will not be able to pick and choose amongst issuing banks." The settlement agreement does not address Visa's rule prohibiting U.S. merchants from surcharging customers, said Visa's press release. According to Josh Floum, general counsel at Visa Inc., "Visa has always allowed merchants to discount for cash and PIN-debit, and extending the ability to discount by network brand is a reasonable accommodation." He noted the settlement would not impact the ability to "continue growing our business by offering innovative payments products that consumers and merchants value above any others. The settlement gives U.S. merchants new tools to manage their acceptance costs while benefitting from the tremendous value electronic payments deliver." MasterCard General Counsel Noah J. Hanft noted, "Our discounting practices have long been more flexible than our major competitors' and have permitted merchants to discount for cash, checks, debit cards and other payment brands." Interchange fees has been a big topic in the U.S. Congress in recent years. Earlier this year, lawmakers passed a bill that, in part, allows the government to set interchange fees. The Credit Union National Association (CUNA) maintains that the fees are best set in the market and that the fees allow business costs, including the risk of consumer nonpaymentd, to be shared by the payments participants. CUNA also opposed the legislation on behalf of credit union members, arguing that such action could drive up consumer costs as well as limit consumer options, competition and technological innovation. This settlement and the new suit arrive as the Federal Reserve continues its work to implement the new law. Although credit unions with less than $10 billion in assets are exempt from interchange regulations the Federal Reserve Board is writing, CUNA is concerned that the law does not require the marketplace to accommodate higher fees for smaller issuers. CUNA advocates a two-tier interchange fee system to accommodate credit unions. CUNA and its Interchange Working Group are working to head off any unintended consequences of interchange regulation. (News Now July 28).

CUs Michigan First trademark issue settled

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LATHRUP VILLAGE and TROY, Mich. (10/5/10)--A Michigan credit union and a Michigan bank have settled a trademark dispute involving the words "Michigan First" in both their names. Michigan First CU, based in Lathrup Village, and First Michigan Bank of Troy announced Friday they have amicably resolved their trademark dispute, and all pending judicial and administrative proceedings stemming from the dispute have been dismissed. The details of the agreement are confidential, the two organizations said in a join press release (PRNewswire Oct. 1). First Michigan, with assets of more than $565 million, filed the trademark infringement lawsuit against the bank on May 12 in the U.S. District Court for the Eastern District of Michigan in Ann Arbor. It had sought an injunction against First Michigan Bancorp Inc., based in Troy, Mich. over the words "Michigan First" (News Now May 18). According to the complaint filed, the credit union adopted and used several service marks, all incorporating and prominently featuring the words "Michigan First." These include 'Michigan First Credit Union" for its credit union services, "Michigan First Credit Union Moneyworks,' for its internet banking services, "Michigan First Wealth Management Group" for its financial planning and estate planning services, and, the credit union's website. On April 30, state regulators closed Port Huron-based CF Bancorp, which operated 22 branches under the Citizens First name--19 of them in Michigan and many of them in the same market as the credit union. The regulators sold the bank's deposits and some of its assets to First Michigan Bank, a bank that was established in 2007 (Detroit Free Press via May 1).

CU System briefs (10/04/2010)

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* PITTSBURGH, Pa. 10/5/10)--Curtis James Porter, 46, of Ambridge, Pa., has pleaded guilty in a U.S. District Court to a Sept. 26, 2008, robbery of Friendly CU, Aliquippa, Pa. (7thspace Oct. 2). He faces up to 20 years in prison and a fine of $250,000 or both. Porter allegedly entered the bank, leaned over the teller's window and threatened, "Give me the money or I'll kill you." He fled with $9,600 but was caught outside by police officers alerted by credit union members who observed the robbery in progress and stayed on the phone with 911 until Porter was apprehended. The money was recovered. Sentencing was set for Jan. 28 ... * BEAVERTON, Ore. (10/5/10)--Three Oregon credit unions were recognized as "Top Employers" by Oregon Business Magazine, according to the Credit Union Association of Oregon. Providence FCU, Milwaukie, was the No. 1 non-profit organization in the state to work for in the 10-24 employees category. The competition involved more than 150 non-profit organizations in the state. Valley Health and Postal Employees CU, Salem, finished 14th in the small employers' competition. Oregonians CU, Milwaukie, ranked sixth among large employers, defined as having 75 or more employees ... * HARRISBURG, Pa. (10/5/10)--Citadel FCU honored U.S. Rep. Jim Gerlach(R-Pa.) during a breakfast Sept. 28 and thanked him for his support of credit unions, according to the Pennsylvania Credit Union Association (Life is a Highway Oct. 4). Here, Gerlach, center right, is shown with members of the host committee. The committee included: Jeff March, Kevin Quinn, Mike Schnably, Maria Steffy, Rosemary Helm and Tim Greim, all from Citadel; Rick Stipa, TruMark Financial CU; John Faust, Diamond CU; Rick Wargo, PCUA; John Rothwell, Rothwell Document Solutions; and Christopher Pippett, Fox Rothschild. Citadel is a $1.5 billion asset credit union located in Thorndale, Pa. (Photo provided by the Pennsylvania Credit Union Association) ...

CUNA OpSS Council names new exec committee

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MADISON, Wis. (10/5/10)--The new executive committee and officers for the CUNA Operations, Sales & Service (OpSS) Council were announced during the council’s 13th annual conference Thursday through Sunday in Las Vegas. Remaining as council chair is Jennifer Lehn, executive vice president, Numerica CU, Spokane Valley, Wash. Sue Douglas, senior vice president and chief operating officer, State Employees’ CU, Raleigh, N.C. will continue as vice chair. Two new members were elected for three-year terms: Patsy Gayda, director of branch operations, Spokane (Wash.) Teachers CU and Becky Davis, vice president, branch operations, Delta Community CU, Atlanta. Steve Langley, vice president of sales/service/training, Travis CU, Vacaville, Calif. was elected to the committee after being appointed earlier this year. Patti Dixon, vice president of service centers, Baxter CU, Vernon Hills, Ill. chose not to run for re-election. The CUNA OpSS Council executive committee also includes:
* Secretary/Treasurer Debbie Baumann, vice president operations/chief operating officer, Mazuma CU, Kansas City, Mo.; * Dave Tate, vice president branch operations, for Anheuser-Busch Employees’ CU, St. Louis.; * Tina McMinn, vice president, operations, Stanford FCU, Palo Alto, Calif.; * Robb Keith, senior vice president, retail services, Members 1st FCU, Mechanicsburg, Pa.; and * Lucy Ito, senior vice president, growth/development, The California and Nevada Credit Union Leagues, Ontario, Calif.

Ohio league Anti-bank sentiment boosts CUs growth

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CLEVELAND (10/5/10)--Ohio credit unions are experiencing record membership growth two years after the financial crisis broke out nationwide, reported the Cleveland Plain Dealer (Oct. 4). For the fifth consecutive quarter, the state’s 392 credit unions reported rising membership, according to the Ohio Credit Union League’s most recent report in July, the article said. Anti-banking sentiment and a “Move Your Money” national campaign initiated in December that encourages consumers to switch from large banks to local financial institutions, such as credit unions, account for the popularity of credit unions, the league told the newspaper. Credit union membership gains in 2006 and 2007 were due to people joining credit unions to obtain low-loan rates during the borrowing boom, Patrick Keefe, vice president of communications and media for the Credit Union National Association, told the paper. However, continuing credit union membership growth the past two years amid a recession reflects a shift in consumer sentiment, he said. “It’s really about dissatisfaction with banks,” Keefe added. Ohio Catholic FCU in Garfield Heights experienced 8% membership growth in the past year, Randy Trimm, the credit union’s CEO, told the paper. “People have grown frustrated with being underserved and overcharged by banks,” Trimm added. To read the article, use the link.

Beach to retire as CEO of CO-OP Shared Branching

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RANCHO CUCAMONGA, Calif. (10/5/10)--Carroll Beach, president/CEO of CO-OP Shared Branching (the former CUSC), a subsidiary of CO-OP Financial Services, has announced he will retire Jan. 31 to pursue other levels of personal and professional interests. Beach, a long-time executive in the credit union movement, was previously president/CEO of CUSC before assuming responsibilities with CO-OP. He began his career with credit unions as the president/CEO of the Colorado Credit Union System. During his 30-year tenure there, he was responsible for the leadership of the Colorado Credit Union League, its subsidiaries and related organizations. Beach also served on various boards, including that of the Credit Union National Association, Credit Union House LLC, U.S. Central FCU, Credit Union Service Corp. and the Association of American Credit Union Leagues (AACUL). He served on numerous committees and received AACUL's highest award, the Eagle Award. Beach also is a recipient of the Herb Wegner Lifetime Achievement Award, the most recognized award in the credit union industry. "He has played a pivotal role in leading the corporation to success with his steadfast devotion, progressive perspective and enthusiastic commitment to the betterment of the financial health of credit union members," said Bill Raker, board chairman of CO-OP Shared Branching. "Carroll was instrumental in the combination between CO-OP and CUSC in 2007, allowing credit unions to offer unprecedented access and convenience to their members," said Stan Hollen, CO-OP Financial Services president/CEO. "His vision has enabled credit unions to plug into one technologically advanced, streamlined hub, making a variety of payment channels easily available to members now and in the future."

Three regulators begin new term on NASCUS board

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SAN ANTONIO (10/5/10)--Three sitting board members of the National Association of State Credit Union Supervisors (NASCUS) began new three-year terms at the 2010 NASCUS Annual Meeting Friday. Tom Candon, Sue Cowan and Linda Jekel will serve three-year terms ending in September 2013. Kathy Stewart also was appointed to fill the at-large one-year director position. Candon is the deputy commissioner of Banking and Securities for the Vermont Department of Banking, Insurance, Securities and Health Care Administration. Cowan is the director of the Wisconsin Office of Credit Unions and Jekel, a past chairman, serves as the director of the Washington Division of Credit Unions. Stewart is the director of Financial Institutions for the Kentucky Department of Financial Institutions. Following the meeting, the board elected its officers. Orla Beth Peck will continue as the chairman-elect and Cowan remains NASCUS secretary/treasurer. Candon will serve as chairman until September 2011. Remaining board members include:
* James Forney; director, Iowa Department of Commerce; * Mary Hughes, Financial Institutions bureau chief, Idaho Department of Finance; * Jerrie Jay, administrator, North Carolina Commerce Department, Credit Union Division; * Roger Little; deputy commissioner, Michigan Office of Financial and Insurance Services; and * Peck, supervisor of Credit Unions, Utah Department of Financial Institutions.

Two Oregon CUs exploring merger

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EUGENE and BEND, Ore. (10/5/10)--Northwest Community CU, Eugene, Ore., and Mid Oregon FCU, Bend, Ore., have signed a letter of intent to explore a merger. Both boards of directors have approved the letter. The potential merger must undergo a due diligence review process, and be approved by regulators and by Mid Oregon FCU members, who will vote on joining the Northwest Community charter. “The goal of both organizations is to offer a combined credit union that is capable of offering more convenience, more locations and more technology services for banking throughout Oregon,” said Barb Blackmore, chair, Northwest Community CU. Northwest Community CU has $650 million in assets. Mid Oregon FCU has $138 million in assets. Both credit unions emphasized they are financially sound.

USAID awards WOCCU 4M for agrural finance outreach

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MADISON, Wis. (10/5/10)--The U.S. Agency for International Development (USAID) awarded World Council of Credit Unions (WOCCU) $4 million to implement a five-year Cooperative Development Program (CDP) with credit unions in Guatemala, Mexico and Kenya.
Click to view larger image The Cooperative Development Program will expand upon the World Council of Credit Unions’ (WOCCU) credit union outreach methodologies, including Semilla Cooperativa, developed by WOCCU’s rural finance program in Mexico. Credit union field officers there use personal digital assistants to provide financial services in members’ communities. (Photo provided by the World Council of Credit Unions)
The program will focus on creating and testing agricultural and financial tools to improve rural economic and financial sector development, livelihoods and food security. The resulting “toolbox” for credit unions will include a replicable and scalable methodology to meet the financial service needs of small farmers and agribusinesses, and increase their access to markets, inputs and technical assistance for production. Credit unions face challenges serving rural areas, where dispersed populations rely on extremely variable income, limited or no financial services and inadequate market information, WOCCU said. Credit unions often struggle to develop and deliver appropriate, high-quality products and services for farmers and rural entrepreneurs while keeping transaction costs low and maintaining an economic margin. At the same time, legal, regulatory and policy frameworks can prohibit product development and certain forms of outreach. Without the proper tools to grow, agricultural and agribusiness development has remained stagnant in many rural farming communities, WOCCU added. “Credit is a crucial component to increasing the income of rural producers, but credit alone does not always solve economic problems,” said Brian Branch, WOCCU executive vice president and chief operating officer. “With the CDP program, we apply an innovative approach that addresses both the financial needs and market barriers for rural producers in a more integrated way than we and other development organizations have previously tried.” WOCCU’s program will join financial and agricultural technical services and employ information technology (IT) outreach solutions to stimulate rural economic growth. The technology-based delivery systems and new agricultural products developed through CDP will enable small producers to smooth their incomes and increase production. WOCCU will draw on its value-chain finance experience in Peru, rural finance approach in Mexico and IT-based delivery systems in Colombia, Guatemala, Kenya, Mexico and Rwanda to develop the toolbox. During the first two years of the program, WOCCU will work with credit unions in Guatemala and Mexico to create and document the use of new financial products, services and delivery mechanisms for value chains and rural producers. Credit unions in Kenya will implement the methodology in the final three years of the program to test its replicability. WOCCU has participated in USAID’s CDP for 30 years. In recent years, WOCCU’s CDP developed the first Model Regulations for Credit Unions, supported the launch of a U.S.-Ecuador international shared branching network in collaboration with WOCCU’s USAID-funded development program in Ecuador, piloted a credit union remittance outreach program in the U.S. and implemented an HIV/AIDS peer training program through a teachers’ credit union in Kenya. Throughout the current five-year program, WOCCU will collaborate with partner cooperative development organizations and share lessons learned and achievements with the broader development finance community.

Coopera discusses Latino-owned biz with lawmakers

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DES MOINES, Iowa (10/5/10)--Coopera Consulting met with U.S. Rep. Nydia M. Velazquez (D-N.Y.), chairwoman of the Congressional Hispanic Caucus, and U.S. Rep. Leonard Boswell (D-Iowa) to discuss Latino-owned small businesses and how credit unions are working to serve the youngest, fastest growing and most underserved U.S. population--Hispanics.
Click to view larger image Coopera Consulting met in with U.S. Rep. Nydia M. Velazquez (D-N.Y.), chairwoman of the Congressional Hispanic Caucus, and U.S. Rep. Leonard Boswell (D-Iowa) to discuss Latino-owned small businesses and how credit unions are working to serve Hispanics. Pictured are, from left, first row: Velazquez and Boswell; Warren Morrow, CEO, Coopera Consulting; Felix Gallagher, CEO PharmServ Solutions. Second row: Francis Musignac, Alianza Ad Hoc; Anna Haug, client service coordinator, Coopera; Christina Fernandez-Morrow, board member, Iowa Credit Union Foundation; Melvin Rosario, Alianza vice president; Andrew Herrera, Alianza membership chair; Miriam De Dios, vice president, Coopera; Brent Helin, CEO, Des Moines (Iowa) Metro CU; Micah Kiel, Alianza president; Julie Vande Hoef, director of government affairs, PolicyWorks; Mark Killian, CEO of Community Business Lenders; and Michael Adams, vice president of marketing and public relations, Greater Iowa CU, Ames. (Photo provided by the Iowa Credit Union league)
Coopera Consulting works to educate credit unions on how to reach and serve Hispanics and how to implement solutions to meet the needs of the Hispanic community. The needs include personal, mortgage and commercial loans, remittances, prepaid reloadable cards and financial education. “Credit unions are helping economically empower the largely underserved Hispanic community,” said Warren Morrow, Coopera CEO. “Credit unions could do even more if legislation would permit it.” Credit unions offer member business loans (MBL) to Iowa businesses, but there is a statutory limit that restricts credit unions from lending beyond 12.25% of their total assets. As credit unions reach this lending cap, they are forced to turn away business owners in need of access to capital, said the Iowa Credit Union League. Increasing the MBL cap to 27.5% from 12.25% of assets would extend more than $10 billion in new capital and create 120,000 new jobs nationwide without any cost to the federal government or tax payers, the league added. During the meeting, Boswell and Velazquez agreed to contact the House Financial Services Committee Chair Barney Frank (D-Mass.) to encourage him to host a congressional hearing on increasing the cap. The congressional visit was made possible by Alianza Latino Business Association. Members of Alianza also attended the meeting and shared how the organization assists Iowa Latino businesses and their plans for the future.

CU System brief (10/02/2010)

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* FARMINGTON HILLS, Mich. (10/4/10)--A merger between Community Choice CU and Kelly FCU, both based in Farmington Hills, Mich., has been finalized, Community Choice announced Friday. Members of Kelly FCU voted last month to support the merger, which already had been approved by the National Credit Union Administration and Michigan's Office of Financial and Insurance Regulation. The combined credit union will offer expanded services to 6,800 Kelly Services Inc. employees. "By joining forces with Community Choice CU, we can offer additional banking services including credit cards, mortgages, insurance, investments, financial education, and expanded availability through eight locations, more than 28,000 nationwide ATMs and an extended hours call center," said Tom Manecor, board chairman at Kelly FCU. Phil Cooper, chief operations officer at Community Choice CU, said the credit union "is a financially sound institution with a growing line of financial services," which makes it a "viable partner to smaller institutions seeking more stability and services for their members." During the month, Community Choice will update the credit union station at Kelly Services headquarters in Troy, Mich., to feature a personal teller machine and surcharge-free ATM ...

Members United meets on franchise value service plans

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WARRENVILLE, Ill. (10/4/10)--Members United Corporate FCU hosted a webinar Friday morning to update members on the state of the corporate since it was placed into conservatorship. In the webinar, the leadership noted that all shares are insured through Dec. 31, 2012, all products and services are in place with no interruptions, and the corporate will deliver a new plan for its survival to members later this month, according to the New Jersey Credit Union League (The Daily Exchange Oct. 1). The corporate was one of three placed into conservatorship on Sept. 24 by the National Credit Union Administration (NCUA). Scott Hunt of NCUA's Office of Corporate Credit Unions and now a board member of the corporate told members there is value in the Members United "franchise" and he hoped members would be open to listening to Members United's plan for the future. "The benefit of Members United and the other corporates is a franchise value," he told those attending the webinar. Members United serves 2,400 members out of the 7,600 credit unions in the system, a "significant" number, he said. NCUA encouraged members to consider a long-term, viable partner as a group. The corporate will have time to consider a plan. If a viable plan isn't found, members would then have about 24 months to find a future provider. However, Hunt said NCUA would be flexible on the timing. "It will be much more difficult for members if we piece out services to other providers. The first goal is to remain intact all the solutions provided to members by Members United," he said. Interim CEO Chuck Furbee emphasized that a bridge corporate "means we look different from an accounting perspective, but we look very much the same from an operations standpoint." For the next six months it is better for the entire corporate credit union system if credit unions keep their funds in the corporate while NCUA works on implementing the legacy asset strategy, Hunt said. Credit unions asked if those who lost member capital shares will have an opportunity to recoup the funds if the "legacy assets" perform better than expected. However, Hunt noted that the funds' priority will be to settle the corporate's liability and the returns likely would not be cleared for up to 20 years. "The amount and timing are very much unknown. I don't want to give any false perception that will happen, but we are preserving that opportunity." A recording of the one-hour webinar is available at Members United Corporate's website. To access it, use the link.

First Carolina Corp. Reg is in line with biz plan

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GREENSBORO, N.C. (10/4/10)--First Carolina Corporate CU says the National Credit Union Administration's (NCUA) final rule concerning the corporate credit union system is in line with First Carolina's business plan. In an update sent Wednesday to the Greensboro, N.C.-based corporate's member credit unions, President/CEO David W. Brehmer said the "new regulatory framework that ended up in the final regulation is very much in line with where we were heading in our business plan." "We believe that from an operational perspective, First Carolina can succeed and continue to serve its members in a value-added manner. First Carolina is a profitable operation today and that should continue well into the future," he said. "Our challenge in the near term will be executing our recapitalization effort as we have no choice but to raise new capital and convert existing capital to meet the minimum capital requirements outlined in the new regulation," he added. Brehmer noted the corporate is in the process of reworking its capital restoration plan with a goal of discussing it at its board meeting this week. After the meeting, the corporate will set dates and locations for town meetings. NCUA announced the final rule on Sept. 24, along with its plan for treatment of "legacy assets" and its conservatorship of three corporate credit unions: Southwest Corporate FCU, Members United Corporate FCU and Constitution Corporate FCU.

Texas league warns of phishing scam

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FARMERS BRANCH, Texas (10/4/10)--The Texas Credit Union League is warning credit unions about an e-mail in circulation claiming the Texas league was notified by Visa that a national retailer may have experienced a card security breach. The perpetrator is phishing for personal information to be used fraudulently, the league said. The league encourages credit unions to continue educating members about phishing and other scams. The phishing e-mail reads: “The Texas Credit Union League (TCUL), representing all of Texas credit unions, was notified by VISA that a national retailer may have experienced a security breach. As a result, some Texas credit unions VISA/Master/ATM/Debit card accounts may be affected. If you have received this notification means that your card account was identified as being at risk.” The e-mail signature uses the name of Guy M. Hood, the well-known, retired CEO of the Florida Credit Union League. He has never been affiliated with the Texas league. The league is taking steps to protect the privacy of its members and sent copies of the e-mail to the Texas attorney general’s office Internet Crime Complaint Center.

Federation briefs press about CDCI funds

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NEW YORK CITY (10/4/10)--The National Federation of Community Development Credit Unions Friday held a press briefing regarding the Treasury Department’s Community Development Capital Initiative, through which 48 community development credit unions received funds. During the conference, federation President/CEO Cliff Rosenthal noted that the infusion--roughly $70 million for credit unions--was the largest he’s seen in 30 years. Total funding through the program is $570 million. The infusion is “not bailout money,” Rosenthal emphasized. The funds will help credit unions to better serve their members and communities by allowing them to expand their services. Some credit unions have turned people away because of their capital shortcomings, he added. Responding to the application process for funds, credit unions must undergo a rigorous review process to ensure they are well-suited candidates, Rosenthal said. “It’s not a walk in the park,” he added. The funds were distributed to recipient credit unions at the end of September.

N.C. governor launches small biz lending initiative

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GREENSBORO, N.C. (10/4/10)--North Carolina Gov. Beverly Perdue has launched the Capital Access Network initiative to increase government guaranteed lending to small businesses statewide. The state’s commissioner for small business and the commissioner of banks are working together on the initiative and have introduced a statewide network of 65 business advisers who are available to assist credit union and bank clients with financing issues (North Carolina Credit Union League’s Weekly Update Sept. 28). Credit union employees may refer any small or mid-sized business owner to a local business adviser through the Department of Commerce’s Business Link North Carolina (BLNC). The BLNC staff will conduct an initial interview, provide some guidance on the documentation the business owner will need to support a loan application, and refer them to a local business adviser. The adviser will then work face-to-face with the business owner to improve the loan application and understanding of eligibility requirements for all types of debt financing, including debt guaranteed by the Small Business Administration and U.S. Department of Agriculture. If a credit union refers a member business owner to one of the business advisers for assistance in preparing a loan package, the advisers have agreed to return that client to the credit union for loan submission. The counseling services are confidential and free. The business advisers are members of the Small Business and Technology Development Center, the Small Business Center Network and SCORE, a nonprofit association dedicated to educating entrepreneurs and helping small business.

INews NowsI Top 10 stories for September (10/01/2010)

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MADISON, Wis. (10/4/10)--Stories about the corporate credit union system dominated September’s list of top 10 stories in News Now. Other stories that made the list include a study indicating that credit unions beat banks on trust, and the Secure and Fair Enforcement for Mortgage Licensing (SAFE) Act. September’s top stories are: 10. Official insurance signs have March 2011 deadline WASHINGTON (9/3/10)--Starting March 2, 2011, federally insured credit unions must abandon any jury-rigged public displays that disclose a 2006 change in law that increased share insurance levels to $250,000, up from $100,000. 9. Study: CUs beat banks on trust--again MADISON, Wis. (9/8/10)--Banks could take a lesson from credit unions on building relationships, according to a recent Mintel Comperemedia report. 8. More on SAFE Compliance: Sample policy WASHINGTON (9/14/10)--The Credit Union National Association, in response to inquiries, has written a sample policy that credit unions may find useful to review in developing their own Safe and Fair Enforcement for Mortgage Licensing Act (SAFE) policy that must be adopted by Oct. 1. 7. NCUA: Assessment at 12.4 bp, corp. CU rule Sept. 24 ALEXANDRIA, Va. (9/17/10)--The National Credit Union Administration (NCUA) approved a 12.42 basis point National Credit Union Share Insurance Fund (NCUSIF) assessment at its Thursday open board meeting. 6. NCUA reveals new corporate CU rule ALEXANDRIA, Va. (9/27/10)--The National Credit Union Administration on Friday revealed the final corporate credit union rule. 5. NCUA to CUNA: Expect merger registry in Oct. WASHINGTON (9/9/10)--The National Credit Union Administration (NCUA) said credit unions can expect a national merger registry "to be live by October." The registry, an idea initally recommended by the Credit Union National Association would provide the names of potential credit union merger partners. 4. NCUA denies community charter for CU BRIDGETON, Mo. (9/20/10)--The National Credit Union Administration (NCUA) has denied an application by Bridgeton, Mo.-based Vantage CU to convert to a federal community charter. 3. Compliance: A SAFE registration update WASHINGTON (9/13/10)--The Conference of State Bank Supervisors (CSBS) briefed the Credit Union National Association (CUNA) and other trade associations last week about its progress on developing the registration process that banks, credit unions, and their employees will have to follow in order to comply with the Safe and Fair Enforcement for Mortgage Licensing Act (SAFE Act). 2. CU movement reacts to NCUA’s actions on corporates MADISON, Wis. (9/28/10)--The credit union movement responded over the weekend to the National Credit Union Administration's (NCUA's) announcements about its final corporate rule, the conservatorship of three corporate credit unions, and its plan to isolate and securitize the corporates' "legacy assets." 1. Cheney battles notion of CU ‘bailout’ on Fox News WASHINGTON (9/29/10)--Credit Union National Association (CUNA) President/CEO Bill Cheney took to the airwaves to correct the misperception that credit unions are being "bailed out" by the National Credit Union Administration's (NCUA) recently released corporate credit union and legacy asset plans.

AVCU advises Peru CUs on startup ATM network

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SOUTH BURLINGTON, Vt. (10/4/10)--Joe Bergeron, president of the Association of Vermont Credit Unions (AVCU), and Michelle Fullerton, AVCU program services administrator, traveled to Peru last week to advise South America credit unions as they work to grow a startup ATM network.
Joe Bergeron (right), president of the Association of Vermont Credit Unions (AVCU), and Michelle Fullerton, AVCU program services administrator, traveled to Peru last week to advise credit unions as they work to grow a startup ATM network. (Photo provided by the Association of Vermont Credit Unions)
Bergeron and Fullerton made the trip at the request of the World Council of Credit Unions (WOCCU) (Newslines Express Oct. 1). WOCCU called upon AVCU because it has operated its own ATM and debit card program and developed Electronic Funds Transfer (EFT) knowledge for more than 15 years. Kuskanet is one of five similar WOCCU projects ongoing in Latin American countries. Bergeron and Fullerton consulted with managers and operations personnel from the Kuskanet ATM network at the Federacion Nacional de Cooperativas de Ahorro y Credito del Peru (FENACREP) offices and at select Kuskanet credit union locations in Lima and Ayacucho. Peru’s credit unions are politically locked out of regional and national EFT networks. As a result, prior to the creation of Kuskanet, credit unions could issue plastic cards, but members had no place to use them. The startup ATM network, so named because “kuska” means “together,” is owned by WOCCU, FENACREP and a handful of member credit unions. “It’s amazing what they’re doing with the resources they have available to them, especially considering how they’re politically blocked from accessing networks by big banks,” Bergeron said. “Kuskanet hopes to change that dynamic and create competition with banks that will provide members with the same services that bank clients receive and will ultimately benefit all Peruvian consumers.” He noted that Kuskanet completely bypasses checking accounts. “Peru credit unions don’t have checking accounts, so they’re going direct to plastic cards for access to cash.” Because of the inability to access EFT networks, making the ATM cards debit-capable isn’t an option right now, but Bergeron and Kuskanet said they hope to change that in the future. The long-term goal is to research possible alternatives to gain access to already existing remote access infrastructures. Leading the trip and assisting the consulting efforts was Steve Schaefer, WOCCU manager of technical services. Schaefer oversees WOCCU’s EFT projects in Peru and in other Latin American countries. AVCU is in its third year of a WOCCU international partnership with FENACREP and Peru’s credit unions. Prior to the ATM network project, AVCU researched the possibility of developing a deposit insurance system for Peru’s credit unions, with Bergeron providing testimony to a committee of Peru’s national congress. Representatives from AELUCOOP credit union will visit Vermont next week to sign a partnership agreement with Vermont FCU, Burlington. AELUCOOP, the second largest credit union in Peru, has a membership that is predominantly Japanese. The same is true of ABACO, the largest Peruvian credit union, which is in a WOCCU partnership with Heritage Family FCU, Rutland. Early in 2011, representatives from Pacifico CU will travel to Vermont to establish a partnership with NorthCountry FCU, South Burlington.

What do census figures mean for CUs

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MADISON, Wis. (10/4/10)--The U.S. Census Bureau’s recently released 2009 American Community Survey (ACS), which provides information on the nation's population, has some ramifications for U.S. credit unions, according to a Credit Union National Association (CUNA) economist. Wednesday’s release is based on survey responses collected during 2009 and provides data on the U.S.’ socioeconomic, housing and demographic characteristics. For median household income, the ACS shows:
* Real median household income in the U.S. fell between 2008 and 2009-- decreasing by 2.9% to $50,221 from $51,726; and * Between 2008 and 2009, real median household income decreased in 34 states and increased in one: North Dakota.
Regarding poverty, ACS data show that:
* Thirty-one states saw increases in both the number and percentage of people in poverty between 2008 and 2009; and * No state had a statistically significant decline in either the number in poverty or the poverty rate.
“The thing that causes poverty is job loss and the inability to find jobs,” Mike Schenk, CUNA senior economist, told News Now. “The immediate effect of job losses is rising delinquencies and charge-offs. We already lived through that. “Increases in unemployment mean incomes go down,” he added. “That effect is softened by the [government] social safety net. Nevertheless, when incomes go down, we see higher delinquencies and charge-offs. Since 2010, the deterioration in labor markets has stopped. Labor markets are beginning to heal themselves, so incomes should go up. “We’ve seen declines in delinquency rates at credit unions, but they’re just marginal improvements,” he continued. “The longer-term effects of higher poverty rates don’t express themselves in delinquencies and defaults; they mean people don’t get loans and credit is not as readily available. Less credit available means less spending and less economic growth.” For home values:
* In 2009, the median property value for owner-occupied homes in the U.S. was $185,200; * After adjusting for inflation, the median property value decreased in the U.S. by 5.8% between 2008 and 2009.
Regarding rental housing costs:
* Nationwide, roughly two in five renter households (42.5%) experienced housing costs that consumed 35% or more of their incomes; and * Housing cost burdens ranged from a low of 23.2% of renting households in the Casper, Wyo., metro area to a high of 62.8% of renting households in the College Station-Bryan, Texas, metro area.
“Declines in home values in the short-run mean higher delinquencies and defaults, but we’ve lived through most of that already, so most of the nasty consequences of that are behind us,” Schenk said. “However, declines in home values mean that people are less willing and able to borrow money and to spend. “People can’t tap into home equity because there’s less of it or it doesn’t exist,” he continued. “The labor force is a lot less mobile. If a house is worth less than you pay for it, you’ll be less able to sell it and move to where the jobs are. “So it prolongs the difficulties in the labor market and tends to be a self-reinforcing cycle,” Schenk concluded. The first set of 2010 Census data, including the nation’s population and congressional apportionment figures for the states, will be released by the end of 2010. To see the ACS release, use the link.

Post CUs can seize opportunity from slow economic growth

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SAN ANTONIO (10/4/10)--Four areas of risk will affect the economic recovery, and credit unions and regulators should expect continued difficult economic times that may not return to the "normal" as they know it, attendees of the National Association of State Credit Union Supervisors (NASCUS) Annual Summit were told Thursday. CUNA Mutual Group President/CEO Jeff Post, speaking at the summit, said he believes the slight improvement in 2010's economic conditions may only be a break, rather than a real economic recovery. “We’re clearly not in a recovery and we face the potential risk of the economy declining before it fully stabilizes,” Post said. “I believe we’re entering a new economy--one that will not have the type of growth or accumulation of wealth we’ve seen in previous decades. I also believe it’s very important to have our eyes wide open for the future. In times of great challenge, there are also opportunities to improve, differentiate and gain market share.” Post focused his concern on four areas of risk that will affect an economic recovery: housing, employment, credit losses and debt.
* Housing: “Total delinquencies were at 13.97% at the end of second quarter. With foreclosures continuing and inventories still high, there’s a real concern that values will continue to decline. Credit union members are affected in another way--many were counting on their home equity to contribute to their retirement. In the future, that may not be an option.” * Employment: “Only when there’s a consistent increase in employment will we see improved home sales and starts. Until companies have more confidence in the future, employment will continue to be a challenge.” * Credit losses: “Remember, the economic crisis started as a credit crisis, and we continue to see credit losses continuing today. An astonishing $1.3 trillion of consumer debt is delinquent ... Adding to the weight of this debt is the fact that consumers’ income statements aren’t flush now due to high unemployment and rock-bottom interest rates.” * Debt: “I worry about the next decade and beyond because of the growing U.S. debt and debt around the world.”
Despite the gloomy economic picture, Post said he feels better about the economy today compared to 2008 and early 2009. “However, I’m clearly not bullish,” he added. He reminded attendees that challenging times also present opportunities and suggested credit unions employ some of the same strategies CUNA Mutual has in the down economy. “This is a great opportunity to clarify your strategy and what sets you apart," Post said. "Now is the time to improve by leveraging your strengths and reducing costs in areas where you don’t differentiate, and it’s also an opportunity to return to your roots, or your original purpose. These actions can help improve your operations and the balance sheet, and give you the flexibility to adjust based on the things you don’t control,” he added.