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CUNA Survey: Most Smartphone Users Make Mobile Payments

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WASHINGTON (10/30/13)--More than half of smartphone users surveyed have used their phone to make some type of mobile payment, according to a survey released today by the Credit Union National Association.
 
The survey defines "mobile payment" as "any payment done using a mobile phone."
 
CUNA's survey also found that regardless of whether or not smartphone owners make mobile payments, security remains their foremost concern, with 77.7% listing security as their most serious concern about mobile payments.
 
Other concerns were much less significant, with no other category garnering more than 10%, CUNA said. Those included concerns about the battery life of the phone (6.9%), confusion in using the device (6.4%), not having enough rewards/bonus features (5.1%) and the inability to track a budget (4%).

"The fact that the overwhelming majority of smartphone users listed security as a top concern is a reminder to financial institutions and others that offer mobile payments that users won't sacrifice convenience for security," said CUNA Executive Vice President of Strategic Communications and Engagement Paul Gentile.
 
"While there have been many advances made with mobile security in recent years, respondents' concerns over security indicate financial institutions and companies in the mobile space must continue to stress their focus on security with their customers," Gentile said.
 
Among respondents who use mobile payments, 91.6% indicated that ease of use is the greatest benefit. The most common single transaction dollar amount for a mobile payment was over $50 (34%).  That was followed by:$25.01 to $50 (9.2%),$10.01 to $25 (7.6%), $5.01-$10 (3.2%) and $0.01 to $5 (1.7%).  Of those surveyed, 44.3% indicated that they don't use mobile payments.
 
When it comes to rewards, traditional payment methods are still preferred over mobile payments.  Mobile payments were viewed the least favorably with regard to rewards, bonus features, and points, with 6.1% preferring mobile payments.  About 41.8% preferred credit cards, while 25.9% preferred debit cards, and 26.2% were unsure.
 
When broken down by age groups, the greatest use of mobile payments came from respondents ages 30-44 (59.6%), followed by those ages 18-29 (57.9%), 45-60 (47.8%), and 61 or older (24.1%). The survey also suggested that more women (54.5%) than men (47.6%) made mobile payments.
 
CUNA's Mobile Payments Survey polled 1,046 people via the Internet from a population of mobile phone users.  The respondents were 51.3% female and 48.7% male.  Roughly 18.2% of respondents reported household income of less than $25,000, while 13.9% reported less than $50,000 annual income; 32% reported less than $100,000; 18.1% reported less than $150,000 and 17.8% reported more than $150,000. The U.S. Census Bureau regions reported were representative as well, with no region making up more than 16.5% of responses.
 
The survey is the third edition of CUNA's quarterly consumer survey.  Previous topics were on student loans and women in finance.

CUNA Receives Three Nominations For Board Elections

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WASHINGTON and MADISON, Wis. (10/30/13)--The Credit Union National Association has received the first three nominations for the CUNA Board of Directors elections.
 
CUNA is seeking nominations for eight positions on board. Nominations will be accepted through Nov. 26.
 
The first to be nominated are:
  • District 1, Class A--Edwin L. Williams, president of Discovery FCU, Wyomissing, Pa.;
  • District 1, Class D--William J. Mellin, president of the Credit Union Association of New York, Albany, N.Y.; and
  • District 5, Class C--Tony C. Budet, president of University FCU, Austin, Texas.
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.
To be nominated, an individual must be an employee or a voting board member of the nominating credit union, and the nomination must be seconded in writing by at least two other credit unions from the same district and class.
 
To become an eligible candidate to be elected by leagues, an individual must be a league president and be nominated in writing by that league, and the nomination must be seconded in writing by at least one other league from the district.
 
For contested elections, ballots will be sent Dec. 2, with voting continuing through Jan. 10.  Results of contested elections will be announced Jan. 15.  Directors elected will take office upon the adjournment of CUNA's Annual General Meeting on Feb. 24.
 
For more information, use the link.

Despite Remittance Rules, CU Will Continue Service

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FARMERS BRANCH, Texas (10/30/13)--Saying it is putting its members' needs first, a Texas credit union will continue its international remittances transfer program--even though it and other financial institutions will face more compliance and due diligence regulations under the Consumer Finance Protection Bureau's new Remittance Transfer Rule, which went into effect Monday.

Border FCU, a $120 million asset credit union based in Del Rio, Texas, says it won't stop offering international remittances to its members, despite the new rule. Instead it will tough it out in order to serve its members' needs.
 
Maria Martinez, president/CEO of the $120 million asset credit union, told the Cornerstone Credit Union League that despite the fact the rule requires more compliance and due diligence, remittances are a service that is greatly needed, so it will continue offering the service (Leaguer Oct.  29).
 
"If we were to stop offering remittances, we would be closing the doors on our members who rely on a safe and secure method of getting funds to loved ones," she told the league.
 
Border FCU offers remittances via Directo a Mexico, as well as through Catalyst Corporate FCU.  It is being forced to raise its fee for both services.  The fee for Direct a Mexico will increase to $5 from $3, the credit union said.
 
"Remittances are not a significant revenue generator for us. We offer the service because we recognize that a significant percentage of our membership has family living abroad who depend on the remittances," Martinez said.  "However, in order for us to continue providing the service, our members will have to share in the cost."
 
The Credit Union National Association is seeking information from credit unions about whether the new rules' compliance burdens are forcing closures of or cutbacks in their remittance programs.

CUAid Distributes $208K+ To Colorado Flood Victims

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MADISON, Wis. (10/30/13)--Since activating its online disaster relief system CUAid.coop a month ago, the National Credit Union Foundation (NCUF) has distributed more than $208,000 in grants to 248 credit union members in Colorado affected by September flooding. But more is needed.
 
NCUF is working with the Mountain West Credit Union Foundation (MWCUF) and credit unions in the Boulder, Colo., area to distribute the funds.
 
"I would like to thank all the credit union and individual donors for their generous and ongoing response to the needs of Colorado credit union staff and members," said Dan Santangelo, MWCUF executive director.
 
"This flood has taken a huge toll on the lives of many and the relief provided is really making a difference for them. The need is still strong and scores of folks still need assistance. I would like to encourage our community to continue to donate so we can continue to provide much-needed relief," he added.
 
The flooding in Colorado destroyed nearly 2,000 homes, damaged another 16,000 homes, and hit hard nearly 1,000 businesses. Highways have been re-opened and debris has been removed from neighborhoods and business districts, allowing residents to begin rebuilding their lives (News Now Sept. 25).  
 
CUAid funds have been granted by NCUF to assist credit union members. Even after they recover what they can from insurance payouts, credit union members need assistance rebuilding or relocating to new homes, and replacing lost vehicles and household items such as appliances, furniture and clothes.  
 
"The response by the credit union community to the call for donations has been amazing," said Gigi Hyland, NCUF executive director. "Credit unions are supporting each other when they need it most, which is even more evidence of the credit union difference."
 
Contributions are still needed as more grant applications from Colorado credit union members are expected. To contribute, use the link. CUAid is the only program of its kind that enables credit union employees, volunteers and members, as well as credit unions and credit union organizations nationwide, to contribute directly to support other credit union people.
 
All donations through CUAid go to credit union disaster relief. If any donations are not used for Colorado flooding relief, NCUF will transfer unused funds to its "General Disaster Relief fund" for future disaster relief efforts.
 
Organizations and individuals can use a variety of CUAid web buttons for their website. Use the link for a donation form.

California/Nevada CUs Donate $174K+ To Children's Hospitals

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ONTARIO, Calif. (10/30/13)--Several California and Nevada credit unions celebrated International Credit Union Day on Oct. 17 by helping Credit Unions for Kids create miracles.
 
They donated $174,538 to CU4Kids to benefit local hospitals belonging to Children's Miracle Network Hospitals.
 
Each time members used their check card or credit card on Oct. 17, the participating credit unions donated 25 cents or any self-determined amount to CU4Kids.
 
"Kids who need the most care will now be able to receive it thanks to the generosity of these credit unions, and their members," said California and Nevada Credit Union Leagues President/CEO Diana Dykstra.
 
The leagues, with support from Rancho Cucamonga, Calif.-based CO-OP Financial Services, encouraged credit unions to participate in this year's event. The statewide initiative was an outgrowth of a 2012 program launched by four California credit unions--California CU in Glendale; Xceed Financial FCU, El Segundo; SkyOne FCU, Hawthorne; and Wescom CU, Pasadena.
 
Some credit unions were eligible for a CO-OP Miracle Match from CO-OP Financial Services. CO-OP provided $23,427 in matching funds. Launched in 2008, CO-OP Miracle Match is a $1-million philanthropic matching program that encourages credit unions, chapters and leagues to create and participate in local CMNH fundraisers.
 
Other credit unions participating included:
  • Caltech Employees FCU,  La Canada-Flintridge;
  • Clark County CU, Las Vegas;
  • Community First CU, Santa Rosa;
  • Eagle Community CU, Lake Forest;
  • Farmers Insurance Group FCU, Los Angeles;
  • Financial Partners CU, Downey;
  • First City CU, Los Angeles;
  • Health Associates FCU, Orange:
  • LBS Financial CU, Long Beach;
  • Kinecta FCU, Manhattan Beach;
  • McKesson Employees' FCU, San Francisco;
  • Orange County's CU, Santa Ana;
  • Pacific Service CU, Walnut Creek;
  • Redwood CU, Santa Rosa;
  • San Mateo CU, Redwood City;
  • SchoolsFirst FCU, Santa Ana; and
  • Southern California Postal CU, Long Beach.

New PCUA CEO Now On Board

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HARRISBURG, Pa. (10/30/13)--Patrick Conway joined the Pennsylvania Credit Union Association staff Monday as president/CEO. 
 
Monday was the first day in the office for the Pennsylvania Credit Union Association's new CEO, Patrick Conway, seated. From left, Rhonda Rumbaugh, vice president, marketing and professional development; Rick Wargo, executive vice president/general counsel; Kati Shoop, vice president, human resources/corporate relations; and Corinne Sherman, senior vice president, fee services. (Photo provided by Pennsylvania Credit Union Association)
Conway, who previously served as the president/CEO of the Pennsylvania Restaurant and Lodging Association for 12 years, was named CEO Sept. 18. He succeeds retiring president/CEO Jim McCormack, and is the PCUA's fifth chief executive since it was organized in 1934 (Life is a Highway Oct. 29).
 
"Considering the burdensome regulatory climate today, and the economic and legislative uncertainties facing our industry, it is more important than ever to have a strong voice representing Pennsylvania's credit unions," said Conway.
 
Conway also served as president/CEO of the Harrisburg Regional Chamber and the Chamber of Business and Industry of Centre County.
 
He began his career in the district office of U.S. Rep Bill Clinger (R), served as executive director of the Governor's Action Team under Gov. Tom Ridge, and ran for Congress in Pennsylvania's 5th district.

CU System Briefs (10/30/2013)

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  • WILKES-BARRE, Pa. (10/30/13)--A man faces up to 60 years in prison and fines of $750,000 after pleading guilty to robbing three financial institutions, including Choice One Community FCU, Hazleton, Pa. Senior U.S. District Court Judge A. Richard Caputo accepted the guilty pleas in Wilkes-Barre, Pa., Monday. The robberies occurred over nine days in April 2012. Shawn Luther Kelly allegedly robbed PNC Bank in Hazle Township of $3,980 on April 16, 2012. He was accused of robbing Choice One FCU in Wilkes-Barre of $1,140 on April 20, 2012. Kelly was arrested shortly after a robbery of Citizens Bank in Hazleton of $1,420 on April 24 (The Wilkes-Barre Times Leader Oct. 21). Authorities used a combination of apprehension tools and strategies to capture Kelly, including a tracking device inserted into one of the money bags, surveillance footage and cellphone tracking ...
  • PHILADELPHIA (10/30/13)--A Williamstown, N.J., woman Friday was sentenced to nine years in prison for an identity theft, loan, and tax fraud scheme involving more than $1.6 million at five financial institutions, including four credit unions. Katrina Taniesha Waters, 33, pleaded guilty to 83 counts, including bank fraud, false statements on loan applications, filing false tax returns, and false statements to a government agency. She allegedly applied for fraudulent personal loans, credit accounts, and automobile draft loans using falsified identification, employment, income and tax information, and false sales and vehicle documents, including fraudulent vehicle identification numbers. Waters was accused of applying for loans at Police & Fire FCU, Philadelphia; Navy FCU, Vienna, Va.; Philadelphia (Pa.) FCU; American Heritage FCU, Philadelphia; Freedom FCU, Warminster, Pa.; and Susquehanna Bank, Lititz, Pa., according to a press release from the Justice Department and the Federal Bureau of Investigation ...

DFCU Financial Rewards Members With $23M Cash Payout

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DEARBORN, Mich. (10/30/13)--DFCU Financial said Tuesday it will return a $23 million dividend to nearly 100,000 members at year-end.
 
The dividend is the largest payout in the eight-year history of the credit union's dividend program, and brings the total payout since the program's 2006 inception to more than $154 million. The credit union has paid out an average of $20 million for the past eight years.
 
"The economy may have struggled, but we have been able to give a larger sum of cash back to our members every year," said Mark Shobe, DFCU Financial president/CEO. "Our relationship with each individual member of DFCU Financial is extremely important to us. We want our members to know we care about them, and the fact that this dividend has been increasingly successful shows their loyalty."  
 
Individual dividend payments will be equal to 0.5% of members' average yearly loan and deposit balances, including all savings accounts and loan balances. Each qualified member will receive at least $50, the credit union said.

'CU Planet' Blog Launches With Videos From NWCUA Conference

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PORTLAND, Ore. (10/29/13)--A man traveling the country to document the work of credit unions launched his project on International Credit Union Day, publishing videos he recorded at the Northwest Credit Union Association's Amplify Convention in Portland, Ore.  (Anthem Recap Oct. 25).

Click to view larger image Gene Pelham, right, CEO of Medford, Ore.-based Rogue CU, discusses credit unions' community impact with Carlos Rodriguez, founder and publisher of "CU Planet," a blog aimed at telling credit unions' stories and capturing collaboration between people and credit unions.  (Photo provided by the Northwest Credit Union Association)
Carlos Rodriguez, founder and publisher of the blog "CU Planet," posted an interview with NWCUA President/CEO Troy Stang, and a profile of Gene Pelham, CEO of Medford, Ore.-based Rogue CU, as part of his blog's launch on Oct. 17.

The inaugural post also includes a video about Seattle, Wash.-based Verity CU's Mom Blog, a report about credit unions' role in helping Vancouver, B.C., turn 2010 Winter Olympics dormitories into condominiums, and a report about a partnership between Connection, Kitsap and Peninsula CUs designed to help members deal with the federal government's sequestration budget cuts.

A former credit union employee who most recently worked as a marketing manager at Santa Cruz Community CU in California, Rodriguez launched the blog because he said that he believes credit unions can help end poverty.
 
Rodriguez works alone for now, but is planning on allowing credit unions to upload their own material to "CU Planet," and says he hopes to expand operations with a view of turning the blog into a cooperative.

The NWCUA Amplify convention took place from Oct.8-10.

CU System Briefs (10/29/2013)

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  • ALBANY, N.Y. (10/29/13)--The Credit Union Association of New York, Community Resource FCU of Latham, Sunmark FCU of Latham and Capital Communications (CAP COM) FCU of Albany were named among the 30 best places to work in the Albany region in 2013 by the Albany Business Review. The publication will honor the winners for their employee-friendly work environment at a Dec. 6 lunch event--timed to coincide with the release of a special publication dedicated to discussing the 30 companies' best practices, said CUANY ...
  • HIGHTSTOWN, N.J. (10/29/13)--The New Jersey Credit Union League is accepting submissions for a league board position vacated by Raymond Del Nero. The deadline for applications is Thursday. The league board will then decide who is eligible and is expected to select a replacement by Nov. 15. Del Nero, who recently stepped down, was a Tier C "At-Large" director. His replacement can come from any asset-sized credit union. The appointee will have to run for election at the end of 2014, when Del Nero's term would have expired (The Daily Exchange Oct. 28) ...

Mich. League's Card-skimming, Other Bills Progress In Legislature

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LANSING, Mich. (10/29/13)--Several bills initiated or supported by the Michigan Credit Union League are making progress in state legislature. They include a card-skimming package, a group of commercial code bills and affidavit bills regarding real estate.
 
A five-bill partisan card-skimming package initiated by the league, after a Michigan credit union brought the matter to the league's attention, was voted out of the state House Criminal Justice Committee last week (Michigan Monitor Oct. 28).  House Bills 5050, 5051, 5052, 5053 and 5054 all deal with card-skimming, a significant form of fraud and loss, said the league.  Current law does not specifically address card-skimming devices. 
 
Financial institutions have found that skimming devices are readily available for sale and take a minimal amount of time to install on ATMs, gas pumps and other card terminals. Criminals install the devices, often a camera, to read cards or capture personal identification numbers as they are keyed in so they can collect personal information, said MCUL.
 
Currently there are conflicting penalty provisions in the state law, and jurisdictional adjustments are needed to facilitate easier prosecution, said the league.
 
MCUL, Steve Dedene of Ferndale-based Credit Union ONE and Michelle Mattson of Pontiac-based Genisys CU  provided testimony supporting the bills. Although the matter had been scheduled before the committee only for testimony, the committee voted unanimously voted to support the bills.  MCUL will continue working with the sponsors of the package as it moves through the House and into the Senate.

Other bills of note in the state:
  • Senate Bills 547, 548, 549, 550 and 551, a group of commercial code bills supported by the league, were voted out of the state Senate, 36-0, and now head to the House chamber for a first reading and committee assignment. The league worked with Sen. Darwin Booher (R-Evart), the bills' sponsor, throughout the drafting and committee process.
  • House Bills 4638, 4639 and 4640, a bipartisan package of affidavit bills supported by the league, received testimony in the House Committee on Local Government and a vote is expected at this week's committee hearing, the league said. The bills would amend various acts governing the recording and indexing of real estate conveyances and affidavits with the county register of deeds.  The bills would enable use of verified copies for recording and protect chain of title where documents are lost, which would prevent some legal challenges and help to ensure title. The bills also would ease concerns about electronic signatures in electronic recording, the league said.
MCUL will continue monitoring the progress of the bills through the legislature.

CUNA CPDOnline's System Wins Best Enterprise Learning System

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MADISON, Wis. (10/29/13)--SumTotal Systems LLC, the provider of CUNA CPDOnline's learning management system, won the Best Enterprise Learning System at the ninth annual Best of Elearning! Awards, announced the Credit Union National Association.

It was selected by Elearning! readers for its dedicated learning management resource, SumTotal Learn.

SumTotal Systems provides professional development and human resources solutions and increases performance standards of successful organizations worldwide.

The company also took home the Elearning! award for the Best HR Solution and honors in two categories: Best E-learning Development Tool and Best Simulation Tool. SumTotals's 2013 accomplishments also include the Gold Award for Best eLearning/Learning Management System--bsoco Software of the Year Awards.

CUNA Center for Professional Development Senior Vice President Todd Spiczenski noted that SumTotal's learning management resources is a key component of CUNA CPDOnline. "Their pristine record and reputation are backed by a strong foundation of content and innovation that keeps our system effective. There's a reason we haven't had to seek out learning management solutions since first going into business with them."

By using the SumTotal learning management system, CUNA CPDOnline can offer credit union trainers and managers the ease of assigning, recording, tracking and reporting training for their credit union, said CUNA.

For more information, use the link.

CUAD's Social Good Site Marks 1,500 Stories Posted

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BISMARCK, N.D. (10/29/13)--CU Social Good, a website launched in January by the Credit Union Association of the Dakotas to share good things credit unions do for people and communities, has posted more than 1,500 individual stories about credit unions' outreach into their communities since it launched.
 
That is 500 more than the site had in mid-July. Then, most of the stories involved charitable work and community service projects and financial literacy projects (News Now July 23).
 
"At CU Social Good, you will find these 'good news' stories of credit unions and credit union people being involved in their communities--helping charities, promoting financial literacy, providing scholarships, volunteering their time, and supporting people and planet over profit," said CUAD' in a press release.
 
CUAD encouraged credit unions from throughout the nation to contribute stories that can be used for lobbying, awareness campaigns and community relations.
 
Credit unions can also post their good news stories on the Credit Union National Association's Unite for Good website or on the aSmarterChoice website. Some leagues, such as the Minnesota Credit Union Network, are collecting stories in their states and reporting them to media contacts to raise awareness about the value of credit unions to their members and community.
 
CUNA's and the leagues' Unite for Good campaign aims to raise awareness, remove barriers, and foster service excellence in a campaign toward a united strategic vision for the movement, where Americans choose credit unions as their best financial partner.  Use the links for more information.

Welch, Sanders Confirm CU Tax Status Support

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WASHINGTON (10/29/13)--Two members of Congress from Vermont--U.S. Rep. Peter Welch (D) and Sen. Bernie Sanders (I)--conveyed their unqualified support for the current credit union tax status during Vermont credit union leaders' visit in Washington, D.C., last week, said the Association of Vermont Credit Unions.
 
Meeting in U.S. Rep. Peter Welch's (I-Vt.) office in Washington, D.C., were, from left: Seated, Association of Vermont Credit Unions (AVCU) Directors Bernie Isabelle, Vermont FCU, and Jim St. Peter, New England FCU, and Vice-chair Susan Poczobut, Granite Hills CU. Standing, Director Bob Morgan, NorthCountry FCU; Chairman Sean Gammon, Members Advantage Community CU; Welch; Vice-president Bryan Kent; Secretary Susan Best, ORLEX Government Employees CU; Treasurer Jeff Morse, River Valley CU; and AVCU President Joe Bergeron. (Photo provided by the Association of Vermont Credit Unions).
Welch's first unsolicited point with the delegation was affirmation of the tax treatment of credit unions because of their uniqueness among financial service providers and the benefits they bring to consumers, said AVCU (Newslines Express Oct. 25).

The Senate was in an unscheduled break due to the debt ceiling and government shutdown debate the week before the meeting. However, Sanders called from his Burlington, Vt.,  office to speak with the group, who met with his lead financial issues staffer. As with Welch, Sanders' first unsolicited comments were to affirm his unequivocal support for the current tax treatment of credit unions and the many benefits they provide in the marketplace, said AVCU.

The group also held detailed separate discussions with Welch and key aides for Sens. Sanders and Patrick Leahy (D) about business lending for credit unions, the importance of a viable secondary mortgage market for credit unions, and legislative proposals to reduce privacy disclosure burden on financial institutions.  On increased business lending limits for credit unions, Welch said he is currently neutral but recognizes the need for capital by small business and the competitive benefit credit unions provide to borrowers in the marketplace.

"Although Vermont's congressional delegation has always supported the tax treatment of credit unions in the past, it's especially assuring to get unsolicited affirmations at a time when Congress is scrutinizing future tax exemptions of more than 400 equally concerned interest groups," said AVCU President Joe Bergeron.

In addition to meeting with lawmakers, the AVCU board, president and vice-president held a legislative issues briefing with Credit Union National Association senior management and conducted its annual strategic planning process.

MnCUN Holds Education Session For Examiners

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ST. PAUL, Minn. (10/29/13)--
Click to view larger image A meeting of Minnesota Department of Commerce examiners and the Minnesota Credit Union Network included Chief Examiner Carl Schwartz and his team of examiners, left, and, on the right, MnCUN President/CEO Mark Cummins and Vickie Ganrude, MnCUN director of business development. (Photo provided by Minnesota Credit Union Network)
The Minnesota Credit Union Network conducted an education session last week with a group of credit union examiners from the Minnesota Department of Commerce, the state's regulatory agency of state-chartered credit unions.
 
The group met on Thursday with MnCUN President/CEO Mark D. Cummins and Director of Business Development Vickie Ganrude.
 
MnCUN presented an overview of its mission and an overview of consulting services provided by Ganrude and MnCUN Compliance and Audit Consultant Marcia Armstrong Lewis.
 
"From a compliance standpoint, receiving a document of resolution (DOR) is never a pleasant thing for a credit union," said Ganrude. She noted the consulting services "can help guide credit unions through the challenging process of addressing the issues raised in the DOR."
 
Other topics discussed included the scope of industry regulations and the potential impact of credit union taxation.
 
"This was a good opportunity to meet with the state regulators who work directly with our credit unions on a regular basis," Cummins said. "It's important for us to keep the lines of communication open so we can best serve our credit unions."

Kentucky League Honors Award Winners

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LOUISVILLE, Ky. (10/29/13)--The Kentucky Credit Union League honored three leaders from member credit unions with Kentucky Distinguished Awards at an award ceremony held earlier this month at the league's 79th Annual Meeting & Convention.

Edgewood-based SEMC FCU CEO Bennie Hoppius was given the Frank Moore Award. Louisville-based Class Act FCU board member Cindy Potts received the Steve Broady Award, and Louisville-based Kentucky Telco FCU branch manager Josh Williams was presented the Richard B. Zimmerman Award (By the Way Oct. 25).

Other honors bestowed upon institutions included Credit Union National Association Distinguished Awards, state-level awards that recognize member and community service, and an award granted for youth financial education.

Member credit unions that received Dora Maxwell Social Responsibility Community Service Awards included:
  • For institutions with assets between $20 million and $50 million, SEMC FCU, Edgewood;
  • $50 million and $100 million, Kentucky Employees CU, Frankfort;
  • $100 million and $200 million, Service One CU, Bowling Green;
  • $500 million and $1 billion. Park Community FCU, Louisville; and
  • Over $1 billion in assets, Fort Knox FCU, Radcliff.
Member credit unions that received Louise Herring Philosophy in Action Member Service awards were Commonwealth CU, based in Frankfort, for institutions with between $250 million and $1 billion in assets, and Fort Knox FCU for institutions with over $1 billion in assets.

Commonwealth CU was also granted the Desjardins Youth Financial Education Award.

The 79th Annual Meeting & Convention took place from Oct. 9 to Oct. 11, at the Louisville Marriott Downtown.

Copies of handouts from the convention's learning sessions can be found on the league's website.

Hispanic-Engagement 'Don't Tax My CU' Webinar Is Wed.

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MADISON, Wis. (10/28/13)--The Credit Union National Association and Coopera remind credit unions that they will offer a free webinar on engaging Spanish-speaking members to help protect the credit union tax status at 2 p.m. CT Wednesday.
 
CUNA has teamed up with Coopera to engage in bilingual political advocacy, beginning with "No Le Cobren Impuestos a Mi Credit Union," a complete, Spanish-language version of the "Don't Tax My Credit Union" campaign.
 
The webinar will offer key message points for Spanish-speakers and offers tips for using campaign tools that include:
  • A video and website (use the link);
  • Form letters that members can send to Congress;
  • A Spanish option on the toll-free number, 877-642-4223;
  • Instructions for social media engagement; and
  • Graphics, poster, statement stuffer, flyer.
  The webinar is beneficial for league representatives and credit union leaders, including CEOs, communications, marketing, and bilingual staff who work with Spanish-speaking members.

Did Members Turn To CUs During Government Shutdown?

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MADISON, Wis. (10/28/13)--An informal News Now survey of some of the credit unions that offered assistance during the federal government shutdown found that members indeed took notice of the special offerings. The level of requests varied from credit union to credit union, of course, but even many members that didn't end up in need of assistance inquired if only to consider their options in an uncertain time.
 
All the credit unions contacted reported that members were grateful for those options.
 
Associated CU, Norcross, Ga., offered 60-day, 0% interest federal employee relief loans for up to $750. In what Chad Evans, vice president of the credit union's contact center, described as a "whirlwind" of activity Associated CU granted 350 loans through the program.
 
"It was received very positively. Members really appreciated that we recognized that a core base our membership was being mandated a financial hardship," said Evans, "I give credit to our CEO [Lin Hodges] for seeing this through."
 
Miami (Fla.) FCU, offered a Furlough Relief Loan of up to $3,000 interest-free for 60 days. The credit union received roughly 100 applications and booked about $200,000 in loans, according to the credit union's CEO A. "Buster" Castiglia.  
 
"We had a lot of federal employees that were hurting," Castiglia said. "I honestly didn't realize the depth of their need. Just a couple weeks can put people on bankruptcy's door. We were more than happy to help them."
 
New Mexico Federal Educators FCU, Albuquerque, N.M., offered a $6,000 loan with 0% interest for up to one year for federal workers. As of Oct. 21, New Mexico Educators CU has had about 100 members apply for loans with more "trickling in" throughout the week, said Anneliese Elrod, senior vice president strategic development at the credit union.
 
"In addition to feeling the pinch, there was the uncertain factor of knowing when they were going back to work and when they would be paid," Elrod said.
 
One member, who was not employed by the government, made it a point to stop by the credit union to say she was proud to be a member of a financial institution that offered such assistance, Elrod said
 
"Credit unions are founded to help their members and their surrounding communities and this loan helped to do that," Elrod said.
 
MCLG Family CU in Mason City, Iowa, offered a special loan allowing federal employees to borrow up to $1,000 without collateral at 4.99% interest--lower than its normal short-term small loan rate by 8.51 percentage points. It also allowed members to skip a scheduled monthly payment on loans.
 
CEO Matthew Chizek said that while the emergency line of credit was used by only a small handful of MCLG's 5,300 members, the cooperative got a lot of positive feedback for offering the deal.
 
"It's comforting to the membership that the institution is going to be there for them in good times and bad, and the vision and values are not going to change," he said. "You don't have to be a multimillionaire to be taken care of. Most of our members are blue collar, and we're proud of that."
 
The 35-year old Chizek, who had only been on the job for a week when the government partially shut down, said he was grateful that the board supported the program, which was quickly built as congressional budget talks broke down.
 
Due to a number of mergers throughout its history, MCLG's membership is drawn from a local hospital, a local cement company, and public sector employees at the city, county and federal levels.
 
 M-O FCU, Huron, S.D. launched a "We Stand Ready…" campaign geared toward the federal and postal employees it serves. The credit union also offered penalty-free early withdrawal on certificates, 0% loans for missed payroll and deferred loan payments.
 
The $25 million-asset credit union received about 24 inquiries about assistance and granted eight loans. "I think members were more interested in knowing what their options were," said Tiffanie Gebhart, M-O FCU's marketing coordinator. "There's security in knowing that help is there when you need it."
 
Federal Employees CU, Des Moines, Iowa, offered no-interest loan and payment waivers for current loans to furloughed government workers. Mike Whittie, CEO of the $18 million-asset credit union, said about 30 to 35 members either skipped payments or took advantage of loan offers.
 
"Those who live paycheck to paycheck needed some assistance," Whittie said. "They couldn't go without anything. And they were very grateful," Whittie said. "It was all out of need, and as soon as they got their back pay, all the loans were taken care of."
 
Credit unions received extensive media attention for their efforts to reach out to furloughed employees.  Mainstream press not only focused on credit unions' efforts to assist furloughed federal employees, but also carried general articles touting the benefits of credit unions.

CU System Briefs (10/28/2013)

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  • DALLAS, Texas (10/28/13)--Eight Brazilian credit union trade association executives on educational exchanges in Texas, Arkansas and Oklahoma are in the second week of a three-week internship program. The executives, from the Porto Alegro-based Sicredi, have been interning with member credit unions within the Cornerstone Credit Union League, the league for credit unions in the three states. (News Now Oct. 8) Maikel Zenker, director of business for Sicredi Vale do Taquari RS, and temporary intern at Texas Trust CU in Mansfield, described the exchange of knowledge and strategy as "incredible." Luciane Werner, another Sicredi executive interning at Texas Trust, visited American Airlines FCU, Educational Employees CU (EECU), Forth Worth City CU and Unity One CU along with Zenker. The pair also attended the Fort Worth Chapter of Credit Unions' chili cook-off fundraiser for the Texas Cornerstone Credit Union League Political Action Committee.  They also attended Catalyst Corporate FCU's financial management seminar. The other six executives participating in the exchange are interning with Arkansas FCU, Communication FCU, Tinker FCU, TruService Community FCU, A+ FCU, Amplify FCU, United Heritage CU and University FCU. The exchange between Sicredi and the Cornerstone League was first launched in 2010 through the World Council of Credit Unions ...
  • COLUMBUS, Ga. (10/28/13)--A Columbus man who faces one count of making terroristic threats against credit union employees allegedly told them "heads will roll" and reportedly made reference to an arsenal of 30 weapons and ammunition (Columbus Ledger-Enquirer, Oct. 24). According to court testimony, Herman Wire stands accused of harassing employees at TIC FCU through a weeks-long campaign that included threatening voice mails and a refusal to leave the 13th Street branch. Police testified that TIC had to hire off-duty police officers in response to the alleged disturbances. Wire has several accounts with the credit union and has alleged that it is "stealing his money." He also stands accused of threatening to "kick [the] ass" of a TIC security guard, and calling him a "vile dog." According to police, Wire tried to buy a submachine gun recently, but his request was turned down by clerks at the gun store. When he was arrested on Sept. 12 for making terroristic threats, it was reported that a firearm was discovered in his vehicle. The judge presiding over the case set a bond at $10,000, and ordered an evaluation of Wire's competency ...
  • HARRISBURG, Penn. (10/28/13)--Compliance officials with the Pennsylvania Credit Union Association attended a National Credit Union Association open board meeting on Thursday in Alexandria, Va. (Life Is A Highway, Oct. 25). Senior compliance and operations officer Joanne Broaderick, compliance and operations officer Colleen Mateer, and executive vice president and general counsel Rick Wargo sat in on the federal regulators' meeting, in addition to talking compliance trends with the management team of NCUA Region II. On Thursday, the NCUA finalized a rule on liquidity and emergency funding, and another rule on the electronic filing of financial reports. The federal regulator also proposed a regulation that would mandate capital planning and stress testing for federally insured credit unions with more than $10 billion in assets ...

Champion CU Hosts Elder Fraud And Exploitation Conference

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CANTON, N.C. (10/28/13)--Credit unions are at the forefront of the fight again elder fraud. As an example of that dedication, Champion Credit Union hosted an Elder Fraud and Financial Exploitation Conference earlier this month in Canton, N.C.
 
The conference featured Caroline Farmer from the North Carolina attorney general's office, Postal Inspector Eric Wise who spoke on mail fraud, Mitchell Rathbone and Daniel Blagg with the Haywood County Sheriff's Department, who discussed Project Lifesaver, and Sarah Wenzel with Wenzel and Wenzel Attorneys at Law, who explored powers of attorney and estate planning.
 
Project Lifesaver is a free program that uses radio-frequency technology to find seniors who stray and return them safely to their families.
 
Following the speakers was an informational fair featuring representatives from the Alzheimer Association, Haywood County Department of Social Services, the Senior Resource Center, the Postal Inspection Office, the Attorney General's Office, the Haywood County Sheriff's Department, and Champion CU.
 
In September, National Credit Union Administration Chairman Debbie Matz issued a letter to credit unions strongly encouragomg them to ensure their staff members are  trained on the potential signs that might trigger a report of elder abuse or financial exploitation.  News Now Sept. 25)
 
"Elder abuse involves the illegal or improper use of an older adult's funds, property or assets. Older adults can become targets of financial exploitation by family members, caregivers, financial advisors, home repair contractors, and scam artists. If you or your staff know the older adults in your membership, you may be able to spot irregular behavior or account activity," Matz wrote.
 
She also urged credit unions to review their own policies and procedures "to ensure they are consistent with state law and the interagency guidance regarding reporting requirements when a financial institution suspects elder abuse or financial exploitation."
The letter followed the release of joint federal financial regulatory guidance which clarifies that financial institutions may report suspected elder financial abuse to appropriate authorities.

Filene Offers Report on CU Financial Sustainability

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MADISON, Wis. (10/28/13)--A new white paper from the Filene Research Institute explores the sustainability of the credit union model, and offers credit unions ideas for maintaining sustainably "excellent" organizations.
 
"Credit Union Financial Sustainability: A Colloquium at Harvard University," is based on a series of presentations made at Harvard University earlier this year.
 
The report identifies four traits for sustainably excellent organizations. They include:
  • Have the stomach to be bad. The No. 1 obstacle to service excellence is actually an emotional obstacle. The paper cites a financial institution that became the fastest growing banking in the U.S. on deposits by bucking conventional wisdom. Conventional wisdom holds that the most attractive rates will attract members and customers. The bank offered the worst rates in every local market, but it differentiate itself by offering the best hours and offering the best customer interactions.
  • Avoid gratuitous service. Simply put, gratuitous service is giving members stuff for free. Unfortunately, service excellence is unsustainable if a financial institution offers too much gratuitous service. The paper advises credit unions to design reliable funding mechanisms into the service offerings. One example is offered by the financial institution with extended hours. But if members are asked to pay for services, it must be palatable. For example, charging for a teller is not palatable.
  • Design systems so the typical employee can be excellent. Most organizations try to set their best employees up for success-but they are the most difficult to retain. But sustained excellence comes from aiming at the middle of the pack, not at the top. Credit unions shouldn't optimize for their best employees because they can never have enough of them.
  • Teach customers to behave differently. When members are blocking a credit union's path to sustainability, they must be convince to behave differently for the credit union to thrive. It's pretty easy to get members to behave differently and have them dislike you for it. But great organizations can get members to behave differently while simultaneously boosting satisfaction. Starbucks did it by training customers to order drinks "the cool way," which is also the way baristas prepare drinks most efficiently.

Minn. Commerce Commissioner Visits Cook Area CU

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COOK, Minn.  (10/28/13)--Cook (Minn.) Area CU hosted a meeting on Tuesday with the Minnesota Department of Commerce Commissioner Mike Rothman to discuss the credit union's efforts in providing financial education and to commend the credit union for its educational services to students and the community at large.
 
Click to view larger image Rich Crettol, right, CEO of Cook Area CU, told Minnesota Department of Commerce Commissioner Mike Rothman about the credit union's financial education efforts to benefit its members, the communities and local schools. Commissioner Rothman was in Cook Oct. 22 as part of his statewide outreach tour focused on financial literacy and financial capability. (Photo provided by Cook Area CU)
Cook Area CU was among the commissioner's stops on his fall "outreach tour," in which he is visiting credit unions, banks, community organizations and local businesses across the state.
 
In recent years, financial literacy and financial capability have been a major focus for Rothman and the Department of Commerce. Through the outreach tour, the commissioner is learning more about the efforts of organizations across the state to help improve the lives of consumers by stressing the importance of personal financial management.
 
Rothman applauded Cook Area CU for its financial counseling and educational programs for members and the community, and for its involvement in the North Woods School, a K-12 school in Cook.
 
"It's really amazing and terrific to see how they have reached out to the local school district and kids--to be able to show the value of personal finance and financial education," Rothman said. "I commend them for doing that."

Credit union staff spent the afternoon discussing their various programs, including:
  • Educational workshops and financial counseling through a partnership with Lutheran Social Services;
  • Contributions to schools as guest speakers on topics such as buying a car, balancing a checkbook and obtaining student loans;
  • A partnership with BizKid$, the PBS financial education TV show and curriculum that the credit union offers free to all five schools in its district;
  • Cook Area CU's Credit Builder Loan Program, which helps members with poor credit or no credit reduce debt, improve their credit rating, and establish good savings habits;
  • Participation in National Credit Union Youth Week in April, which works to engage students of all ages and teach them basics of personal finance;
  • College scholarships for high school students, a program that was established in 1982; and
  • An annual Family Fun Night in October, which welcomes hundreds of kids, and uses the opportunity to teach financial education to attendees.
 "With the financial education we provide, people know that we're here to help them," said Rich Crettol, Cook Area CU. "This is how we take care of our members."

Wis. CUs Formalize Commitment To Guardsmen, Reservists

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MADISON, Wis. (10/28/13)--A ceremony highlighting credit unions'
Click to view larger image Those participating in the credit union ceremony honoring military servicemembers employment rights include: (back row, from left) Tom Thomas (ESGR), Christopher Morris (National CU Foundation), Brigadier General John McCoy (Wisconsin Air National Guard), Robin Marohn (Heartland CU), Mike Williams (ESGR), Lora Denniston (Dane County CU), Chad Helminak (Wisconsin CU League); and (front row, from left) Cassie Thom (St. Mary's & Affiliates CU), Michele Lehmann (St. Mary's & Affiliates CU), Dave Stark (Bull's Eye CU), Brett Thompson (Wisconsin CU League), Anita Rauch (Heritage CU), Heather Ristow (Heritage CU), Janet Brereton (Dane County CU). (Wisconsin Credit Union League Photo)
commitment to supporting the rights of National Guard and Reserve employees--as well as the signing of statements of support for the guard and reserve members--was held Oct. 22 by the Wisconsin Credit Union League.
 
The ceremony, held at Credit Union House in Madison, included credit union leaders from throughout Wisconsin, military leaders, and representatives of the Employer Support of the Guard and Reserve (ESGR). The ESGR is an office of the U.S. Department of Defense. It was established to promote cooperation and understanding between Reserve Component Service members and their civilian employers.
 
Two statements of support were signed by the Wisconsin league at the event: One on behalf of the league itself, the other on behalf of all credit unions in the Badger State.
 
"Since their inception, credit unions have valued the service of the men and women who are committed to protecting our country," said Brett Thompson, president/CEO of the Wisconsin Credit Union League. "In working with ESGR, we proudly reaffirm our collective support for military personnel's workplace rights and employment in Wisconsin."
 
The support statements reinforce existing laws under the Uniformed Services Employment and Reemployment Rights Act (USERRA), which are intended to protect servicemembers' re-employment rights when returning from a period of uniformed service, including those called up from the reserves or National Guard, and prohibits employer discrimination based on military service or obligation.
 
The support statements exhibit appreciation for the values, leadership and unique skills guard and reserve members bring to the workforce.
 
"We appreciate the values, leadership and unique skills Service members bring to the workforce and will encourage opportunities to employ Guardsmen, Reservists and Veterans," the support statement reads, in part.
 
Following the ceremony, framed copies of the signed ESGR Statement of Support were made available to credit unions for display.

In The Media: Advocacy, Tax Status, New Regulations

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MADISON, Wis. (10/28/13)--The Credit Union National Association and credit unions were featured in local and national media this week weighing in on core advocacy issues including credit union tax status, and the impact of new regulations on mortgage lending activity.  
 
CUNA President/CEO Bill Cheney was featured in a The Hill's "On the Money" blog discussing a CUNA survey released Monday showing that 60% of the respondents say they will have to discontinue, delay or reduce their mortgage loan product offerings because of the changes, potentially leaving consumers with fewer options.
 
"CUNA has urged the Consumer Financial Protection Bureau to allow more time for compliance, since seven rules will hit within a two-week period, which poses a monumental compliance challenge," said Cheney told The Hill.

Paul Gentile, CUNA executive vice-president of strategic communications and engagement was interviewed for a Oct. 25 Fox Business article on warning signs of elder financial exploitation.
 
"Ideally, if you are older, you need a trusted circle and that trusted circle could be your lawyer or it could be your financial advisor," Gentile counseled in the article. "Let your adult children know where all the money is."
 
Ryan Donovan, CUNA senior vice president for legislative affairs, was interviewed for a Politico article that discussed credit union tax reform. "We're out there helping consumers get loans and helping consumers acquire and maintain savings, while banks exist to make money for their shareholders," said Donovan. "They are completely different organizations."
 
CUNA was featured in a Bankrate.com banking blog about stress tests for credit unions. The article said CUNA has expressed concern about disclosing the results of stress tests.
 
"In addition to questions surrounding what these tests would look like, another large issue looms--cost," the article said. "According to unofficial estimates included in a release from CUNA, arranging the tests could carry a potential tab of $4 million in the first year alone."
 
Twelve credit unions were included in a GoBankingRates.com article on 20 banks and credit unions that are building strong local economies through financial education. The credit unions include:
  • America First CU, Ogden, Utah;
  • Cy-Fair Federal CU, Houston;
  • Dakota Plains FCU, Lemmon, S.D.;
  • Flag CU, Tallahassee, Fla.;
  • Foothill CU, Arcadia, Calif.;
  • Great Lakes CU, Chicago;
  • LA Financial CU, Los Angeles;
  • Mission FCU, San Diego;
  • MONEY FCU, Syracuse, N.Y.;
  • Space City CU, Houston;
  • Travis CU, Sacramento, Calif.; and
  • Ventura County CU, Ventura, Calif.
The Oct. 22 edition of Buffalo Business First featured two are credit union officials that were honored as credit union rock stars by Credit Union Magazine. Featured in the article were Cara Carlevatti, member development coordinator for Great Erie FCU in Orchard Park, N.Y., and Emma Smalley, financial counselor for Boulevard FCI in Amherst, N.Y.
 
The Oct. 25 edition of the Boulder County Business Report discussed area credit unions that have capitalized on the member owned Credit Union Direct auto loan program. Premier Members CU in Boulder grew 35% in membership in 2012, largely because of an uptick in lending through the statewide auto loan program Credit Union Direct Connect, Carlos Pacheco, the credit union's CEO told the Business Report. Boulder Valley CU of Boulder was also featured in the article.

SafeAmerica CU Lends Expertise to Members

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MADISON, Wis. (10/28/13)--Members don't just get an auto loan at SafeAmerica CU--they receive an education on the car-buying process that makes them better consumers, according to an article in Credit Union Front Line Newsletter.
 
"The car-buying process has become so competitive, so intimidating--even with promises of no haggling--that during or after a sale, members often feel like they've been taken advantage of," says Amrita Prasad, lending manager at the $309 million-asset credit union in Pleasanton, Calif. "We want to walk them through the process, step by step. They feel someone is on their side."
 
Consider these two recent examples in which loan officers went above and beyond to help members choose a vehicle and loan that fit their budget.
 
Barbara Reddy, a SafeAmerica employee for 23 years, consulted with a member seeking a new vehicle to accommodate her growing family. The woman acknowledged a lack of confidence in negotiating a favorable price at a dealership.
 
In handling the preapproval application, Reddy not only gave the member a competitive interest rate but explained the process. She showed the member how to conduct research through the credit union's website, and Reddy obtained the vehicle's invoice price and specifications before the member went to the dealership.
 
In a letter to the credit union, the member thanked Reddy for her honesty and training.
 
"She eats, sleeps, and breathes SafeAmerica," Darrell Kazak, vice president of lending, says of Reddy. "No one knows the company better than she does on a consumer lending level.
 
"She consistently receives thank-you letters, meets goals, and sets a great example for newer staff as a team leader, always providing coaching and assistance. I can't speak highly enough of her."
 
Meanwhile, Shena Sunsin assisted a member who desperately needed a commuter car after experiencing some life-changing issues. Two banks denied the woman an auto loan due to substandard credit before she applied to SafeAmerica.
 
After learning the circumstances contributing to the member's credit score, Sunsin structured an auto loan with monthly payments that fit her budget. Sunsin also contacted one of the credit union's preferred dealerships and located a car for the member, who then purchased it.
 
"She's one of those loan officers who won't stop at the first challenge," Kazak says of Sunsin, an employee for two years. "It's not about meeting a sales goal-it's about being there for the members. She's getting a loyal following, too.
 
"We're a financial family network--that's what we preach," Kazak continues. "We're a full-service credit union that'll protect our members every step of the way."

CU System Briefs (10/25/2013)

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  • CINCINNATI, Ohio (10/25/13)--Two Chicago men were indicted by a federal grand jury on Oct. 16 for allegedly conducting a fraud scheme that revolved around a credit union ATM in the Cincinnati area. Dimitar Angelov, 28, and Dimitar Kolev, 26, were accused of using a hidden camera and an electronic scanning device called a "skimmer" to steal peoples' bank account information at a Springdale, Ohio branch of Kemba CU. If convicted, the pair face up to 15 years in a federal prison for fraud in connection with access devices. Skimming is a scheme that involves a secret recording device that copies bank account data after a person uses an ATM. The stolen account data can then be subsequently written onto a blank card and used to steal money from the account-holder. The pair were apprehended by Springdale police officers on Sept. 28 after someone reported suspicious activity--they were seen by the informant individually walking to the ATM and returning to their parked car. Upon searching the vehicle, police officers found numerous cards with magnetic strips. After searching the ATM, law enforcement officials found the skimming device and a pinhole camera. Secret Service agents joined in making the arrest and filed a federal complaint against the duo. Kemba CU is based in Cincinnati and has more than $571 million in assets ...
  • LINCOLN, Neb. (10/25/13)--Frank Wilber was named Liberty First CU's new president/CEO on Tuesday. He is set to replace retiring CEO Ken Bradshaw on Nov. 25. For the past seven years, Wilbur has served as the executive vice president of ELGA CU  in Burton, Mich., a cooperative with $340 million in assets that services six counties in eastern Michigan. Chartered in 1935 as the Burlington Employees Cooperative Credit Association, Liberty First serves Lancaster and Seward Counties in Nebraska ...
  • ALBUQUERQUE, N.M. (10/25/13)--Central New Mexico Community College honored New Mexico Educators' FCU by naming an outdoor area on its main campus after the cooperative. The area was named after NMFCU to recognize the credit union's recent $200,000 donation in support of scholarships. Both the credit union and the school are based in Albuquerque. NMFCU has over $1.2 billion in assets ...

CUs Cited Among GoBankingRates.com Local Economic Builders

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MADISON, Wis. (10/25/13)--Credit unions were featured prominently in an Oct. 21 GoBankingRates.com article highlighting financial institution that offer strong local financial literacy programs.
 
The article, "20 Banks and Credit Unions Building Strong Local Economies Through Education," included 12 credit unions.
 
The credit unions included:
  • America First CU, Ogden, Utah, which partners with two local elementary schools to help mentor students and support school programs. America First is involved in "Warm the Soles," a program that distributes new shoes to economically-disadvantaged students in Utah.
  • Cy-Fair Federal CU, Houston, for a scholarship that recently presented $7,000 in scholarships to seven graduating high school seniors. The credit unions was also recently awarded the Boys and Girls Country 2012 "Friend of Children" designation.
  • Dakota Plains FCU, Lemmon, S.D., which supports local children and schools through scholarship programs, drives and donations. This year, the credit union plans to issue a $250 scholarship to applicants from each of its five branches.
  • Flag CU, Tallahassee, Fla., for its efforts in supporting education and the local community through partnership with local schools, supply donations and drives. Flag CU delivered donated school supplies to W.T. Moore Elementary just before this year's back-to-school season.
  • Foothill CU, Arcadia, Calif., which developed the Classroom Improvement Grantto supply funds for academic awards, equipment educational software, special books or materials. Grants are awarded in $200 amounts and teachers/learning specialists don't need to be Foothill members to qualify.
  • Great Lakes CU, Chicago, which employs the Credit Union National Association's "Mad City Money" program to teach high school students about finance through a series of real world role-play activities. The credit union also awarded six $1,000 college scholarships to local students.
  • LA Financial CU, Los Angeles, which offers scholarships and an internship program for high school and college students who want to gain real world professional experience and learn more about credit union operations.
  • Mission FCU, San Diego, for its "Mission 4 R Schools" program, which donates $25 to a school every time a member opens a Mission checking account; and "Mission 2 $ave," a financial literacy program for children. Mission was a 2012 recipient of the CUNA 2012 Desjardins Youth Financial Education Award for best youth savings program.
  • MONEY FCU, Syracuse, N.Y., its scholarship program, which gives away $7,500 in scholarships to ten high school seniors, and donations to Father Chaplain's Guardian Angel Society, which provides tuition assistance, mentoring and educational aid to local children.
  • Space City CU, Houston, which held its third annual Wolf Scholarship Golf Classic on November 5th 2012, an event that helped raise $10,000 for a new scholarship fund. The credit union 10 scholarships.
  • Travis CU, Sacramento, Calif., for its contributions to the Mary Keith Duff Memorial Scholarship Fund and support of the local Boys and Girls club.
  • Ventura County CU, Ventura, Calif., which partners with THRIVES and School on Wheels to donate books and other school supplies for local children in need.

Tax Threat 'Most Serious' For CUs, MnCUN Leader Writes In Letter To Editor

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ST. PAUL, Minn. (10/25/13)--Mark Cummins, president/CEO of the Minnesota Credit Union Network, defended the credit union tax status in a letter to the editor that appeared in the Oct. 21 issue of the St. Cloud Times. Cummins emphasized that eliminating credit unions' exemption from corporate income tax "represents the most serious threat to our industry, farmers and communities that we've faced."
 
Cummins' letter was in response to an earlier letter in the St. Cloud Times that suggested credit unions be taxed the same as banks. As noted by Cummins in the letter, the debate comes at a time when the nation's tax-policy writers are considering a "blank sheet" approach to tax reforms, where each entity has to make the case for having their current status extended.
 
"Congress is taking a close look at all tax exemptions, including credit unions' exemption to corporate income tax," Cummins wrote.
 
Credit unions emphasize communities before profits, Cummins added. "Any benefits received from the exemption are passed to members," he wrote.
 
"In fact, every $1 of credit unions' corporate income tax exemption puts $10 into the pockets of members and communities. Credit unions also pay millions of dollars in property, sales and payroll taxes each year."
 
Because of their cooperative structure, credit unions offer generally lower interest rate loans and reduced fees, Cummins wrote. "The substantial savings Minnesota credit unions provide to consumers far outweigh any revenue that would be raised by taxing credit unions," he added.
 
"Eliminating the credit union corporate income tax exemption would result in a tax increase on 1.5 million Minnesotans and ultimately could lead to less consumer choice."
 
He urged Minnesotans to contact their lawmakers in support of preserving the credit union tax status.
 
The Credit Union National Association has created a "Don't Tax My Credit Union" campaign to help credit union advocates, including their members, contact lawmakers with that message.  (See the resource link.)
 
To read Cummins' letter use the link.

Fla./Ala. CUs Meet With Cheney, LaPine And State Lawmakers

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BIRMINGHAM, Ala., and TALLAHASSEE, Fla. (10/25/13)--This week, for the third year in a row, Credit Union National Association President/CEO Bill Cheney visited Alabama and the Florida panhandle to meet with lawmakers and tour local credit unions. 
 
Click to view larger image For the third year in a row, Credit Union National Association President/CEO Bill Cheney toured Alabama and Florida credit unions. Here, from left, Cheney is joined by Patrick La Pine, president/CEO of the League of Southeastern Credit Unions and Heath Harrell, president/CEO of Guardian CU, Montgomery, Ala. (Photo provided by League of Southeastern Credit Unions)
Joined by Patrick La Pine, president/CEO of the League of Southeastern Credit Unions, Cheney met with State Sen. Slade Blackwell (R) and State Rep. Paul DeMarco (R) at a reception in Birmingham. Blackwell's and Demarco's presence were critical at a time when comprehensive tax reform is under discussion, the league said.

Also, state legislation on public deposits and an update to the State Credit Union Act will be introduced in 2014. Cheney and La Pine provided a broad view of issues concerning credit unions in Alabama and throughout the country.  

Cheney and La Pine were also able to meet with individual credit unions and attended chapter meetings in Huntsville, Ala., Montgomery, Ala., Birmingham, Ala., Mobile, Ala., and Pensacola, Fla.
 
In total during their visit they met with 43 credit unions, 37 CEOs and more than 180 credit union staff.
 
In Huntsville, Cheney presented an overview of tax reform and the "Don't Tax My Credit Union" initiative to Muscle Shoals and Northeast Chapters at Redstone FCU.
 
"Getting a chance to interact with state lawmakers was very positive," said the league's La Pine. "It's not often that they get to hear from the national movement. I think it helps to give them a better perspective of their local credit unions."
 
The chapter meetings gave credit unions a chance meet with Cheney, express concerns and offer feedback. Cheney presented a national overview of the movement, including tax reform efforts on Capitol Hill and CUNA and the state credit union leagues' "Don't Tax My Credit Union" advocacy initiative.
 
Credit unions also inquired about the Affordable Healthcare Act, National Credit Union Administration's exam issues and the Consumer Financial Protection Bureau. Cheney said the CUNA national examination survey will open again soon. He also stressed the importance of building relationship with examiners.

Duchess of Cornwall, Archbishop of Canterbury Work to Promote CUs in UK

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LONDON (10/25/13)--Camilla, the Duchess of Corwnall, is teaming up with Great Britain's highest ranking clergyman to expand access to credit unions in the U.K.

The wife of Prince Charles invited the Archbishop of Canterbury, the Most Rev. Justin Welby, to her London home last week to discuss a partnership, after he launched a campaign to muffle the allure of payday lenders.

Calling them a "financial cancer," the Archbishop of Canterbury declared war on payday lenders in the United Kingdom in July by creating a credit union for clergy and members of the Church of England and Church of Scotland.  (News Now July 29)

He told the payday lender Wonga that he wanted to put it out of business by using the Church of England to promote credit unions. The church is currently in the process of launching the Anglican Mutual CU.

An aide close to the duchess said that she also is an enthusiastic credit union supporter and wants the Archbishop to channel that passion into his venture. (The Telegraph Oct. 20).

In May, Camilla joined London Mutual CU, based in the southeast London neighborhood of Peckham (News Now, May 17).

In July, Queen Elizabeth also raised the profile of Britain's credit union community, after honoring Darlington CU for its service to the community. (News Now July 31)

In the United States, the Credit Union National Association and credit unions are committed to offering Americans affordable alternatives to predatory payday lenders, with credit unions across the country providing alternatives.
Annual interest rates on loans from federal credit unions are generally capped at 18%. The National Credit Union Administration does offer some flexibility on short-term loans of a relatively small amount, on which credit unions are allowed to charge interest rates up to 10 percentage points higher than the established usury ceiling at the time.
 
Most credit unions with affordable alternatives to payday loans also keep a lid on servicing fees, and offer members financial advice and incentives to get them to switch to longer-term lower-cost lines of credit.

Michigan Community CU Launches Zombie-Themed Community Events

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JACKSON, MICH. (10/25/13)--Michigan Community CU has adopted a zombie theme for Halloween--using it for everything from charitable fundraising to promotion glow-rate auto loans--all as a way to give back to the community.
 
"We take pride in giving back to our community," said Tina Hamilton, Michigan Community CU interim CEO. "It is rewarding to see our members and staff really having fun with this promotion, and we are very excited to be participating in these community events."
 
The credit union donated $500 sponsorship to Zombie Walk Jackson, a 5k event in which all proceeds go to the March of Dimes. The walk was held on Oct. 12, with Michigan Community CU employees and volunteers participating. The March of Dimes supports research aimed at preventing birth defects, premature birth and infant mortality.
 
The credit union is also offering a Zombie Auto Loan Promotion, which includes a rate as low as 2.00% annual percentage rate up to 72 months, and no payments for 90 days.
 
Michigan Community CU "zombies" also appeared at a local gas station on Oct. 18 to pump free gas. The first 25 cars receive $20 in free gas to promote the Zombie Auto Loan Promotion.

CU System Briefs (10/24/2013)

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  • AUSTIN, Texas (10/24/13)--Suzy Brinkman-Doughty, CEO of NAFT CU in Pharr, Texas for 28 years and a Credit Union National Association board member from 1997 until 2002, died on Oct. 21. Brinkman-Doughty was also helped lead the Magic Valley Chapter of Credit Unions, the Texas Credit Union League, and served on the Credit Union National Association Board from 1997 until 2002. She is remembered within the credit union system and her community for her passion and dedication. Brinkman-Doughty was preceded in death by her husband, AC Doughty who died in 2004. He was also a credit union CEO in the valley area. (Cornerstone Credit Union Leaguer Oct. 23)...
  • GOSHEN, Ind. (10/24/13)--Interra CU named Amy Sink as its new CEO on Tuesday. She starts on Nov. 4. Sink was formerly a senior vice president and chief financial officer for Teachers CU, based in South Bend, Ind., where she directed the finance, accounting, treasury, information systems, electronic funds transfer and human resources departments. She is also chair of the board for Alloya Corporate CU. Sink replaces former CEO Jack Sheets. (The Goshen News Oct. 23) Interra is based in Goshen, Ind., has 11 offices, and more than 52,000 members and $644 million in assets...
  • MIDLAND, Texas (10/24/13)--A west Texas car dealer has pleaded guilty to a scheme that cheated a credit union out of $3.9 million on more than 300 loans. (Abilene Reporter-News Oct. 22) After admitting to the conspiracy to commit bank fraud, Raymond Holguin Jr. faces a maximum of 30 years in prison. A sales manager and a former loan officer at the victimized credit union, My Community FCU, earlier pleaded to being accomplices, and also await sentencing. Prosecutors say the three plotted to get loans to customers who failed to meet My Community's lending standards. The loan officer received kickbacks from Holguin...

Patelco Auto Refinance Program Saves Members $1M

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PLEASANTON, Calif. (10/24/13)--Patelco CU, Pleasanton, Calif., announced this week that its "Switch to Save" auto refinance program has saved members more than $1 million.
 
"The success of this program shows that Patelco is truly in a position to improve the financial lives of a great number of people," said Ryan Misasi, Patelco's Chief Retail Officer.
 
"Switch to Save" offers to pay someone $25 if refinancing auto loans or switching credit cards to Patelco doesn't save them money. Most people who have gone through the program have been able to save a significant amount of money, thus totaling more than $1 million dollars for the close to 1,000 participants who've been eligible to save through the program so far.
 
The program was initially rolled out a just a few branches before it was recently expanded to all Patelco locations. It is available to members of the community as well as current credit union members.

CUs Told To Observe 'As Members Do, Not Just Say,' At Mo. CU Meeting Kickoff

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BRANSON, Mo. (10/24/13)--Credit unions can learn about their members by focusing more on their actions and less on their words, according to a speaker at the Missouri Credit Union Association's (MCUA) 2013 Convention and Expo.
 
Brent Dixon, a designer and consultant, told the credit union audience that by
Brent Dixon, a designer and consultant, told his credit union audience that by focusing on how members behave and react, credit unions can better map out what consumers want from financial institutions. (MCUA Photo)
employing "design thinking" and by focusing on how members behave and react, credit unions can better map out what consumers want from financial institutions.
 
"Observe actual behavior," he said. "Ask open-ended questions. You really need to be intuitive and read between the lines in these instances."

Dixon suggested, as an example, that credit unions be wary of extreme answers when analyzing member surveys, and told attendees to look at averages when answers deviate significantly.

Also during the session, meeting attendees indicated they did not think a majority of consumers really understood credit unions.
 
In an on-the-spot poll answered through their smartphones, almost three-quarters of attendees (73%) said they believe that most consumers "don't understand credit unions and need to understand basics." Another 23% said that they believe most consumers "understand credit unions somewhat and need more education."


To remedy this perceived knowledge gap, Mike O'Brien, vice president of marketing for St. Louis Community CU, suggested that credit union staffers advocate on behalf of their industry whenever given the chance--even among family and friends. Michelle Rosner, vice president of sales and marketing for 1st Financial FCU, urged her colleagues to invite members to attend chapter meetings with them.
 

The MCUA convention was held on Oct. 22 in Branson, Mo. Roughly 250 credit union professionals from Missouri, Oklahoma and Mississippi participated.
 

Michigan DIFS Issues Deferred Compensation Bulletin

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LANSING, Mich. (10/24/13)--The Michigan Department of Insurance and Financial Services (DIFS) last week issued a bulletin for state-chartered credit unions to clarify permissible employee deferred compensation arrangements and investment limitations under the Michigan Credit Union Act.
 
The Michigan Credit Union League met with DIFS staff prior to issuance of the bulletin (Michigan Monitor Oct. 22).
 
Currently, the MCUA permits domestic credit unions to "purchase insurance policies and other investment products to fund deferred compensation arrangements for its employees," as long as the arrangement does not present a risk to the safety and soundness of the credit union. In the past, these types of arrangements were typically structured as bank-owned life insurance (BOLI) policies.
 
However, the Michigan DIFS determined that some credit unions were using different deferred compensation arrangements not owned by the credit union, such as collateral assignment split dollar (CASD) plans. The CASD arrangements typically use a series of loans to an executive to fund the CASD over a period of time, with the proceeds from the whole life insurance policy serving as collateral for the loan.
 
The Michigan DIFS bulletin outlines minimum initial due diligence requirements and ongoing monitoring for boards of directors to perform and document. The requirements are intended to ensure that a deferred compensation arrangement does not raise safety and soundness concerns. The bulletin also focuses on the investment relationship (investment funding and obligation related to the deferred compensation arrangement) and accounting and reporting requirements.
 
After working with DIFS on the issue, MCUL hosted two conference calls for state credit unions to discuss the bulletin, its implications and next steps for compliance. The league conference calls featured presentations by John Kolhoff, DIFS Office of Credit Unions deputy director, and commentary and analysis by Holzman Corkery, Doeren Mayhew and CUNA Mutual Group.
 
Participating credit unions were guided through key parts of the bulletin and learned about due diligence and ongoing monitoring expectations, exam issues and important legal, accounting and call report implications associated with the new guidance.
 
Michigan credit unions were advised to review their existing deferred-compensation arrangements for compliance with the bulletin, and where necessary, work with their legal, accounting and insurance professionals to ensure that their plans are in compliance with this guidance.

Minn. CU Foundation Awards $10K In Fin. Ed Grants

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ST. PAUL, Minn. (10/24/13)--The Minnesota Credit Union Foundation recently awarded $10,000 in financial education grants to three credit unions.
 
All grant funds will be used to further the credit unions' diverse financial education programs or initiatives that benefit members and communities.
Recipients were chosen by the Foundation board of directors based on credit union value, community impact, collaboration and creativity.
 
"The Foundation board was very impressed with the applications we received this fall," said Foundation Chair Pat Brekken. "It's impressive to get a closer look at some of the amazing initiatives being coordinated by Minnesota credit unions, and I'm proud that the Foundation can be a resource to provide financial support to these important programs."
 
Fall 2014 Financial Education Grant recipients include:
  • Minnesota Power Employees CU, Duluth, which has partnered Duluth Children's Museum to enhance its "Moneyville" financial education exhibit. The display features interactive, hands-on tours through a mock city to learn economic concepts and experience real-life decision-making scenarios. Moneyville can be toured by the general public or coordinated as a school classroom field trip program.
  • Postal CU, St. Paul, which has developed a peer-to-peer financial education seminar series to deliver to students at Tartan High School, where PCU opened a student-run credit union in early 2013. The education series will provide an in-depth look at four key pillars of financial literacy, including budgeting, saving, credit and money management.
  • St. Paul (Minn.) Federal CU, which will open a student-run credit union at Harding Senior High School in St. Paul. Student branches teach students the basic principles and practices of business, marketing and financial institution operations.

Illinois REAL Solutions Network Partners Share Ideas

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NAPERVILLE, Ill. (10/24/13)--Partner credit unions of the Illinois REAL Solutions met at the end of September to discuss innovations and ongoing efforts in classroom presentations, reality fairs, emergency loans and other topics, said the Illinois Credit Union League. The topics ranged from youth financial literacy, serving underserved areas, small-dollar emergency loans, and more.
 
Credit unions that participated in the meeting included:
  • Alliant CU, Chicago, which partners with Operation Hope to present the "Banking on Our Future" financial education program to local middle school students as part of life skills classes the school offers.  There is no cost for this program and no financial support is required.
  • Great Lakes CU, North Chicago, which created a version of the popular "Mad City Money" reality fair that is designed to work in a middle school or junior high setting.
  • Community Plus FCU, Rantoul, which shared information about several products that it implemented based on presentations at past Illinois REAL Solutions meetings. Among the ideas it shared were a small-dollar emergency loan, a share-secured loan program and a non-prime auto loan program.
  • Mid-Illini CU, Bloomington, which hopes to reach 1,000 students through the Banzai financial literacy program and classroom presentations. The credit union also highlighted the opening of its first branch in a church located in the local area where no other traditional financial institutions have offices. Mid-Illini CU has also introduced a payday loan alternative program called "Catch a Break Cash" that offers loans of up to $1,000, which can be paid back over a period of one year.
  • RIA FCU, Rock Island, which created an educational program for elementary school students called Kids Are Rewarded for Saving, for second through sixth grade students.  At the end of the year, the credit union hosts and helps prepare the students for a lemonade stand fundraiser.
  • Earthmover CU, Aurora, which opened its Panther CU branch at Oswego High School nearly 20 years ago.  Students handle basic transactions at the branch and develop promotional campaigns to encourage other students to join the credit union and to use its products and services. 
 REAL Solutions is the signature program of the National Credit Union Foundation, which works through state credit union leagues to help credit unions make the difference for members, families and communities. REAL Solutions builds member and consumer financial capability by offering tools such as an online resource center, product development, Credit Union Financial Counseling Certification Program, experiential learning programs—like reality fairs, retirement fairs, and life simulations, and more.

Mix Young CU Professionals With ICU Day, Get Cash Mob

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PEWAUKEE, Wis. (10/24/13)--International Credit Union Day had a Gen Y flavor in Wisconsin, thanks to the efforts of the Wisconsin Credit Union League's Young Professionals Network, who coordinated cash mobs throughout the state to support local businesses and cooperatives.

Cash Mobs are like flash mobs but instead of singing and dancing, a group will visit and spend money at a local, small business.  Cash Mobs are organized by groups of people who are trying to make a positive impact and show appreciation for the businesses in their communities.
The Wisconsin Credit Union League's Young Professionals Network coordinated Cash Mobs throughout the state on International Credit Union Day.  Central Cities CU, with staff shown here in front of the hot 96.7 fm vehicle, made the news.

Cash Mobs were coordinated in Madison, Janesville, Stevens Point, Appleton, Oshkosh and Fond Du Lac to raise nearly $3500 ($3473) for local businesses and cooperatives.
 
There were a total of 186 participants, which included credit unions staff, volunteers, family and friends.
 
The goal of the events were to support small, local businesses and reinforce credit unions' mission to serve members and local communities; raise awareness of credit unions through a collaborative effort;  and build rapport with business and community leaders.
 
The Stevens Point cash mob garnered local news coverage. Use the link to view a video.

CU System Briefs (10/23/2013)

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  • WILKES-BARRE, Penn. (10/23/13)--A man who pleaded guilty to robbing a credit union in Hazleton, Penn. and two banks in the area faces a sentence of up to 60 years in a federal prison and fines of $750,000. Shawn Luther Kelly, 35, allegedly stole $1,140 from a Choice One Community FCU branch on April 20, 2012. He also was charged with robbing a PNC Bank branch in Hazle Township, taking $3,980 on April 16, 2012, and a Citizens Bank in West Hazleton, taking $1,420 on April 24, 2012. The case against Kelley was initially being pursued by state and local law enforcement until the FBI joined the investigation. Kelley was caught by a combination of a tracking device placed in one of the bags he allegedly used to steal the money, surveillance footage, and cell phone tracking data (The Wilkes-Barre Times Leader Oct. 21) ...
  • PRINCETON, N.J. (10/23/13)--Amid the federal government shutdown, Americans reported being most pessimistic about quality of life in the U.S. since the last major budget dispute in Washington. Gallup's average Standard of Living Index was measured at 31 for the week ending Oct. 13, equaling the low that the metric reached at the end of the fiscal cliff dispute in January. The index reflects a composite of Americans' current satisfaction and expectations about future living conditions, with the latter being responsible for the majority of the index's eight point decline since mid-September. The index has a maximum of 100 and a minimum of -100, but the highest it has been since it was first measured in 2008 is 45, which occurred in May 2013. It reached a low of 12 during the global financial crisis in the fall of 2008 ...

Space Coast CU Agrees To Dismiss Lawsuit with Barclays Capital, State Street

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NEW YORK (10/23/13)--Space Coast CU has agreed to dismiss its lawsuit against Barclays Capital and State Street Corp. over collateralized debt obligations (CDOs) Barclays sold to now-defunct Eastern Financial Florida CU, a Space Coast attorney confirmed to News Now Tuesday.
 
The credit union has "resolved the case" and is "pleased with the result," said David Bishop, an attorney with the law firm Kirby McInerney LLP in New York, who represented Space Coast.
 
Space Coast, based in Melbourne, Fla., acquired Miramar, Fla.-based Eastern Financial Florida CU in June 2009 in an emergency merger approved by state regulators.
 
As "successor in interest" for Eastern Financial Florida, Space Coast filed a lawsuit in the U.S. District Court for the Southern District of Florida, in Fort Lauderdale. The case involved 12 CDOs sold to Eastern Financial between 2005 and 2007. 
 
The original suit involved instruments underwritten by Merrill Lynch, Pierce and Fenner Inc., J.P. Morgan Securities LLC, UBS Securities LLC and Barclays Capital, and rated by ratings agency The McGraw Hill Cos. (Standard & Poor's) and Moody's Investor Services.
 
Space Coast CU's suit against the other firms is still pending.
 
Space Coast CU was allowed to amend its complaint in March of this year "by alleging in detail, and with a plausible factual basis" the alleged fraud committed by defendants after a federal court judge dismissed without prejudice the credit union's $100 million lawsuit against Wall Street banks and ratings agencies over CDOs sold to Eastern Financial Florida CU. The lawsuit with Barclays Capital and State Street Corp. was carved out of the original lawsuit.

NCB Reports Top Co-op Revenue Earners

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WASHINGTON (10/23/13)--The National Cooperative Bank (NCB) Tuesday released its annual "NCB Co-op 100" report listing the nation's top 100 revenue-earning cooperative businesses, and ranked among them were three credit unions.
 
In this most recent report for 2012, cooperative businesses posted revenue totaling $226.4 billion, a 5% increase from the $215.6 billion reported in 2011, which itself was an 11% jump from 2010.
 
The three credit unions appearing in the top 100 list were $52 billion-asset Navy FCU, Merrifield, Va.; $25 billion-asset State Employees' CU, Raleigh, N.C.; and $15.5 billion-asset Pentagon FCU, Alexandria, Va.
 
Navy FCU reported 2012 revenues of $3.6 billion and placed 12th on the list, up a couple of ticks from 14th in 2011. State Employees' CU had revenues of $946 million, placing 60th on the list, down slightly from 52nd. And Pentagon FCU, with $717 in revenues, placed 82nd on the list, down a little from 76th last year.
 
Charles E. Snyder, president/CEO of NCB, said his organization--a cooperative as its name states--releases its annual report during National Co-op Month as another way it "strives to educate and promote the importance of (the cooperative) sector."
 
"Our report is just one of the many ways we work to inform the public on the advantages of cooperatives in all fields of enterprise," he said, adding, "Whether it is bringing fresh, local food through a food co-op, affordable financial services through a credit union or affordable homeownership through a housing cooperative, cooperatives help strengthen communities."
 
Use the resource link to access the NCB report.

Hope CU CEO Bynum Wins Aspen Institute's McNulty Award

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WASHINGTON (10/23/13)--Hope CU President/CEO William Bynum was named the winner of the 2013 Aspen Institute's John P. McNulty Award for innovation and leadership in social entrepreneurship.
 
Bynum is co-founder of the Jackson, Miss.-based cooperative.
 
"Our goal is to ensure that hardworking people have access to the tools they need to buy homes, start businesses, educate their children and otherwise support their families regardless of their station in life," said Bynum. "Hopelessness in a community is when there isn't a clear path to a better future. At HOPE, we provide a vehicle for people to work together and boost each other up to that next rung on the economic ladder."

Bynum, who has advised Presidents Clinton, Bush and Obama on community development issues, founded Hope CU in 1995 with Aspen Institute fellow Henry Crown. The cooperative provides financial services to impoverished communities throughout the south, with branches in Mississippi, Louisiana, Arkansas and Tennessee.

After the global financial meltdown of 2008 caused credit markets around the country to contract significantly, Hope expanded from three to 15 branches and increased its membership by over a factor of three--from 9,000 to 28,000. It closed more than 7,200 mortgages, and small business and consumer loans worth over $260 million since 2008.
 
An example of the credit union's work, Hope launched a program in April 2011 to expand access to fresh food in blighted New Orleans neighborhoods by granting $14 million in forgivable, low-interest loans to supermarkets and grocery stores pledging to relocate (News Now April 4, 2011).
 
A panel of judges, including former Secretary of State Madeleine Albright, African diplomat Olara Otunnu and international development expert Brizio Biondi-Morra chose the 2013 winner.

Finishing runners-up to Hope were India Leadership Initiative Fellow Manoj Kumar, representing Araku Originals Ltd., Catto Fellow Adam Lowry of the Ocean Plastic Project in San Francisco, Calif., and Henry Crown Fellow Chinwe Onyeagoro of FundWell, also based in San Francisco.

Bynum, who was a finalist for the prize in 2008, will be honored at a reception in New York City on Nov. 6.

Government Shutdown Offers Savings Lessons

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MADISON, Wis. (10/23/13)--During the federal government shutdown, the value of a solid savings plan was underscored for more 400,000 furloughed federal workers.
 
According to a recent poll by the Consumer Federation of America, about half of all American families have heeded the warnings brought on by tough economic times and have a traditional savings account with a median balance of $2,400 (creditunionsonline Oct. 11).
 
Research shows that families are often faced with emergency situations, ranging from a car repair to a medical bill to a traffic violation, , CFA Executive Director Stephen Brobeck noted, adding a savings account is the best way--easiest and least expensive--for many families to pay for those unexpected expenses.  He said, especially for those with few financial resources, relying on a credit card, payday loan, or even friends or families are usually much less desirable options.
 
Saving for between three to nine months-worth of expenses  is about the average amount that will allow most families to increase financial security. And going to a credit union may be the best place to begin, Brobeck said.
Savings and financial literacy are among the principles credit unions stress to their members. Credit union financial educators reached 400,097 students in 12,243 classrooms presentations during the 2012 school year, according to the National Youth Involvement Board (News Now Aug. 22).
 
Also, credit unions' cooperative ownership structure allows them to offer generally higher savings rates than their for-profit competitors.
 
Research conducted and reported by GoBankingRates.com this year found that credit unions had the best savings account interest rates in the nation for 2012, according to a study of savings accounts at more than 4,000 banks and credit unions.  Eight of the Top 10 U.S. Savings Account Rates were held by credit unions. Use the resource link to read about the study.

Dwolla Partners With FIs To Test Real-Time Payments

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DES MOINES, Iowa (10/23/13)--Dwolla, a person-to-person payments provider, has initiated a credit-based instant payments capability, which will be built in part on its partnerships with credit unions and banks.
 
The financial institutions vet merchants and consumers for real-time payments, allotting each party specific credit limits. Financial institutions have granted credit from $1,000 to $16,000 so far, said Dwolla CEO Ben Milne in a blog post.
 
The service will provide credit to consumers that they can use when shopping online by selecting a new Dwolla funding source at the time of checkout.
 
Dwolla charges 25 cents for transaction of more than $10. Transfers less than $10 are free. Before the real-time payments launch, users of Dwolla had to wait two to three days for a bank transfer to use money sent to them (PaymentsSource Oct. 22). 
 
Dwolla will initiate a three- to four-week test period with several e-commerce merchants. Eventually Dwolla will introduce the instant payments feature to all of its merchant clients, Milne said.
 
Forty merchants who already accept Dwolla on their sites have announced support for Dwolla Credit, and more will be added in time as the service moves from beta phase to its public release.
 
Dwolla has also partnered Alliance Data Systems Corp (ADS), a provider of branded credit card programs. ADS will provide a cardless, private label credit product through Dwolla's network.
Milne would not reveal the financial institutions it has partnered with to make the feature possible, but the company has a relationships with credit unions.

International Credit Union Day: In Pictures

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MADISON, Wis. (10/23/13)--Credit unions celebrated the theme Unite for Good on International Credit Union Day, and nothing added a brighter light to the celebration than the way credit unions engaged their members promoting the credit union difference.
 
Click for slide show The administrative team of Pelican State CU, Baton Rouge, La., volunteered at the Holy Grill, a local soup kitchen, on International Credit Union Day (ICU Day). The Holy Grill is sponsored by the Interfaith Federation of Great Baton Rouge, and food is served at the Cadillac Street Park Recreation Center in Zion City. Local volunteers help the federation serve free lunch to those in need. (Photo provided by Pelican State CU)
The Credit Union National Association urged credit unions to emphasize their International Credit Union Day celebrations Oct. 17 by sharing their stories on social media, and credit unions responded with stories and photos from around the world that highlighted the creativity and imagination of credit unions and the enthusiasm of their members.
 
International Credit Union Day, celebrated on the third Thursday of October since 1948, also brought proclamations from lawmakers and agencies that that say credit union unions embrace the "people helping people" philosophy by pooling personal resources and leadership abilities for the good of the cooperative, "empowering members to improve their financial futures and untied to help those in need."
 
This year's theme, "Credit Unions Unite for Good," built on CUNA's Unite for Good campaign, which has united credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.
 
Here news New Now presents a slide show that offers a small sample of how credit unions celebrated ICU Day throughout the world.

CUNA Opens 2013-14 Board Of Directors Elections

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WASHINGTON and MADISON, Wis. (10/23/13)--The Credit Union National Association is seeking nominations for eight positions on CUNA Board of Directors.
 
Nominations will be accepted through Nov. 26.
 
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.
An individual must be an employee or voting board member of the nominating credit union to be an eligible candidate elected by credit unions and the nomination must be seconded in writing by at least two other credit unions from the same district and class.
 
To become an eligible candidate to be elected by leagues, an individual must be a league president and must be nominated in writing by his or her league, and the nomination must be seconded in writing by at least one other league from the district.
 
For contested elections, ballots will be sent Dec. 2, with voting continuing through Jan. 10.  Results of contested elections will be announced Jan. 15; and
 
Directors will take office upon the adjournment of CUNA's Annual General Meeting on Feb. 24.

Nomination packets are available by calling 800-356-9655, ext. 4013; using the resource link or e-mailing thanson@cuna.coop.

CU System Briefs (10/22/2013)

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  • CLEVELAND, Ohio (10/22/13)--Fugitive credit-union executiveAlex Spirikaitis, former CEO the defunct Cleveland-area credit union, Taupa Lithuanian CU, which regulators shuttered on July 15, has been arrested in Collinwood by FBI agents, reported the Oct. 21 online version of The Plain Dealer. The FBI declined to describe the arrest or to say how they tracked Spirikaitis to the Collinwood area, but did report that the arrest was about 3:15 p.m. local time and that it occurred as the former fugitive walked down a street. The article reported that FBI agent Vicki Anderson said Spirikaitis had significantly changed his appearance by shaving his goatee, losing weight and allowing his formerly shaved hair to grow out. The former credit union exec is wanted for "false credit institution entries" related to the collapse of the $23.6 million-asset credit union ...
  • WASHINGTON (10/22/13)--Consumer Financial Protection Bureau staffers answered frequently asked questions about a variety of rules in a Mortgage Bankers Association webinar last week. Their answers focused on routine queries about mortgage servicing and loan origination rules. Topics included ARMs, prompt crediting, periodic statements, error resolution and information requests, force-placed insurance, general servicing policies, procedures and requirements, early intervention, loss mitigation, the Truth in Lending Act, the Equal Credit Opportunity Act and the Real Estate Settlement Procedures Act...
  • NORTH COUNTY, Calif. (10/22/13)--A former employee of Pacific Marine CU, who used to process fraud claims, stands accused of defrauding members herself (San Diego Union-Tribune Oct. 20). Prosecutors have alleged that Schrelle Lachae Malone, 35, secretly activated members' ATM cards to steal approximately $20,000. Pacific Marine sends new ATM cards to members as their current one approaches expiration--they're sent back if the member is serving in the military and on active duty. Malone, a fraud claims clerk at an Oceanside branch, is accused of using 14 of the stored cards to carry out the theft. She worked on the claims of three of her alleged victims, including one case in which she allegedly altered a report to hide an ATM withdrawal. Malone pleaded not guilty last week to 18 charges, and faces a sentence of more than 14 years, if convicted. Pacific Marine CU is based in Oceanside, Calif., and has more than $675 million in assets...
  • WASHINGTON (10/22/13)--The U.S. Department of Treasury has released new educational material for credit unions and others through the Community Development Financial Institution Fund. The information, published in conjunction with the "Stengthening Small and Emerging CDFIs" series, includes training curriculum for organizational growth, effective business models, community development advice, and organizational change management...

Harley-Davidson Exec: Time For CUs To Roar

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MADISON, Wis. (10/22/13)--Ken Schmidt is Harley-Davidson's brand visionary and communications strategist and he says if he were to open a business in 2013, it would be a credit union.
 
According to the Credit Union National Association's members-only Credit Union Front Line Newsletter, Schmidt believes small community-based businesses can grow by capitalizing on today's anti-big business mindset among consumers. He made his remarks to the 2013 Solutions Conference hosted by Card Services for Credit Unions, a credit union card processing association with over 3000 members.
 
Schmidt presented the following blueprint for member service representatives, the newsletter reported recently:
  • Get people to talk about your credit union and its services with passion. Don't just seek customers, but strive for disciples: members who believe so strongly in your credit union that, without prompting, they'll tell others about their good experiences and your good products and services.
  • Call members by name. "While I finance my bikes with the credit union, I have an account at a major bank that I go into every Friday," Schmidt says. "Do you know what those bank employees think my name is? They think my name is 'Next.' Don't underestimate the importance of using your members' names."
  • Humanize the business. Harley-Davidson learned the hard way that data and numbers alone don't sell a product. That's because most decisions come from the heart or an affinity to something--they're illogical, according to the Harley exec. So, forge a connection with members. "Only one in 100 members will choose a credit card from your credit union because of a brochure you have at the front counter," he says. "But how about saying to members: 'Do you want to see something cool?' No one's going to say 'no' to that. And then you can physically show members a card and explain where and how they can use it to obtain rewards or other benefits."
Use the resource link to subscribe to the newsletter.

IC FCU Recognized For YouTube Campaign

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FITCHBURG, Mass. (10/22/13)--IC FCU, Fitchburg, Mass., has been recognized by Ragan's PR Daily Digital PR Awards for 2013 in two categories--Best Specialty Campaign and Best Video Marketing Awareness--for its YouTube videos targeting Generation Y.
 
"We were honored and very pleased that the judges of Ragan's PR Daily Digital Awards chose us for these categories over the many that were submitted," said Monica Turner, IC FCU Internet and social media specialist, "We are humbled to be among such notables as Dana Farber, Domino's Pizza and High Tower."
 
The year-long campaign introduced in 2012 consisted of six financial educational videos. Topics included "Credit Unions vs. Big Banks," "Zombie Life Insurance," "The S Word" (S is for Savings), "Budgeting in B Minor," "The Landlord and Broker," and "Credit Card Murphy-Behind the Plastic."
 
The videos went viral and to date have views of over 700,000, with an explosion after release of the final video "Credit Card Murphy."
 
Creators of the videos, James & Matthew + Company, IC FCU with an idea to help raise financial education awareness to the famously sought-after Gen Y population. "With the millions of YouTube videos out there, competing for views can be a difficult task, but adding humor to the educational aspect helped make these videos a huge success, not only because of the viral factor, but because the credit union reported a 51% increase in new Gen Y Members over 2011 where no special Gen Y campaign existed," said Jim Pond of J&M+Co.

GoBankingRates.com Highlights CU Community Halloween Events

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MADISON, Wis. (10/22/13)--Always on a quest to reach out to their communities, credit unions around the country are gearing up for Halloween with a number of holiday-themed events, promotions, and contests. And 10 of them were highlighted in a GoBanking.com article called, "10 Best Credit Unions With Ghoulish Halloween Events This Year."
 
"As financial institutions completely invested in the communities they serve, ten local credit unions are also taking part in the Halloween festivities and celebrating the holiday with their valued members," said the article's introduction.

Celebrations include a movie night, a concert, trick-or-treating, costume parties, children's art competitions and a series of races:
  • Bridgewater CU, headquartered in Bridgewater, Mass., is hosting an art contest. Members can submit their children's Halloween-themed drawings for a chance to win a $100 gift card;
  • Collins Community CU, based in Cedar Rapids, Iowa, is hosting safe trick-or-treating, and a charity rock concert for members;
  • Community 1st CU, which serves central Iowa, is hosting a number of parties, including a day-long "Zombiefest" fair on Oct. 26. Some of its branches are also giving away goodie bags and pumpkins to members on Halloween Day;
  • Community Focus FCU, based in the Detroit, Mich.-area, is having a Halloween coloring contest for kids, with winners receiving gift certificates to Toys "R" Us;
  • Dupaco Community CU, headquartered in Dubuque, Iowa, is partnering with a local radio station and a movie theater to screen Hotel Transylvania, with admission costing 92 cents and proceeds going to a local theater company;
  • M-O FCU, based in Huron, S.D., will be having an open house on Halloween day, with costumed characters, and giveaways;
  • Safe Harbor CU, based in Ludington, Mich., will be giving away gifts in exchange for candy donations, which themselves will be given away as part of trick-or-treat bags at the cooperative's second annual Halloween parade;
  • Secured Advantage FCU, based in Simpsonville, S.C., is asking members to submit photos of family members and pets in costume for a chance to win a $50 VISA gift card, with the photo attracting the highest number of "likes" on Facebook winning the prize;
  • Solidarity Community FCU, based in Kokomo, Ind., is having a party for kids, with games, giveaways and a costume contest; and
  • Summit CU, based in Madison, Wisc., is organizing races--a 10k, a 5k and a 5k stroller derby race, and a marathon and a half marathon.

In the Media: Government Shutdown, CU House, Great Rates

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MADISON, Wis. (10/22/13)--The Credit Union National Association and credit unions last week received media coverage for helping members navigate the government shutdown, serving the Hispanic market and offering great loan rates.
 
In an article about the government shutdown on CNNMoney, Paul Gentile, CUNA executive vice-president of strategic communications and engagement, described how many credit unions are working with furloughed employees, offering services such as special loan rates, salary equivalent loans and skip-a-payment programs.
 
In an article on Yahoo Finance, Bill Hampel, CUNA chief economist, said "consumer confidence is likely to take a major hit as a result of the government shutdown, and could slow the economy for the rest of the year.
 
HispanicBusiness.com cited Gesa CU, Richland, Wash, for being recognized as with CUNA's Excellence in Technology Award for its digital branch initiative.
 
An article on WRBL News 3 highlighted several Georgia credit unions for their efforst in assisting government employees affected by the shutdown:
Credit unions mentioned include:
  • TIC FCU, Columbus;
  • GeoVista, Hinesville;
  • Associated CU, Norcross; and
  • Robins FCU, Warner Robins.
The Las Vegas Review Journal cited One Nevada CU, Las Vegas, and America First CU , Riverdale, Utah, for offering short-term, interest-free loans to furloughed government employees.

The Sioux Falls Business Journal featured Sioux Falls, S.D.'s Sioux Empire FCU's Black Saturday loan sale, which included 0.75% annual percentage rates for new or used vehicle loans for the first 50 members. The next 50 qualifying members receive rates at 1.50%, and the next 100 members receive 2.25%.

Vernon Elliott Honored With Cal./Nev. Leagues' Unsung Hero Award

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ONTARIO, Calif. (10/22/13)--The California and Nevada Credit Union Leagues named Vernon Elliott the 2013 recipient of the Unsung Hero Award. The award honors individuals within the credit union industry with at least 20 years of service who also have made significant contributions in the community.
 
Click to view larger image From left, Courtnay Lynch, Xceed Financial FCU vice president of human resources; her father and 2013 California and Nevada Credit Union Leagues Unsung Hero Award recipient Vernon Elliott; Richard Myles Johnson; Lucy Ito, California and Nevada Credit Union Leagues executive vice president/chief operating officer; and Susan Conjurski, league awards committee chairman and CEO, Printing Industries CU, Riverside, Calif. (Photo provided by California and Nevada Credit Union Leagues)
Richard Myles Johnson--who has known Elliott since they were in the Marines in the early 1970s and who led him into a career in the industry--presented Elliott with the award Oct. 18 at the leagues' Ontario, Calif., offices.
 
Attending the presentation were Elliott's wife, Marilyn, and daughter Courtnay Lynch, vice president of human resources for Xceed Financial FCU in El Segundo, Calif., Lucy Ito, leagues executive vice president and chief operating officer, and Susan Conjurski, league awards committee chairman and CEO of Printing Industries CU, Riverside, Calif.
 
Among the credit unions Elliott served throughout his career were San Diego County CU, where he has his first credit union job, TRW Systems CU, Cal Bear CU, Tiger Federal CU, Western CU, Raincross CU, and Pacific Community CU.
 
"I've enjoyed all of my 36-plus years in the credit union industry," Elliott said upon receiving the award. "And I'm proud of my daughter, who is carrying on the tradition."
 
In addition to Elliott's work with various credit unions, he also worked for the California Credit Union League, where he promoted the idea of a credit union ATM network--now known as the CO-OP network. He served on the Operations Committee for Financial Service Centers Cooperative when the company was first established as well as the League's Assembly/board of directors, CUNA board, and CO-OP Financial Services board.
 
Elliott also served on WesCorp's board of directors. He was chairman his last two years on the board.

PCUA Appoints Young Professional Leadership Council

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HARRISBURG, Pa. (10/22/13)--The Pennsylvania Credit Union Association announced appointments to its Young Professionals Network (YPN) Leadership Council (Life is a Highway Oct. 21).
 
Young professional groups seek to engage a younger generation of leadership at a time when credit union membership is aging. The average age of an adult credit union member in the U.S. currently stands at 47.9 years old, according the Credit Union National Association.
 
The PCUA Council members include:
  • T.J. Adkinson, assistant branch manager, Members 1st FCU, Mechanicsburg;
  • Amanda Carozza, human resource representative/compliance officer, Eagle One FCU, Philadelphia;
  • April Dunn, web account specialist, Citadel FCU, Exton;
  • Joe Gimble, vice president operations, Superior CU, Collegeville;
  •  Stacy Hovan, comptroller, P & G Mehoopany Employees FCU, Tunkhannock;
  • Melissa Polan, marketing and sales coordinator, Washington (Pa.) Area Teachers FCU; and
  • Michael Williams, director of business development, Widget Financial FCU, Erie.
Council members will represent their regions and promote membership in the association's Young Professionals Network (YPN).

They will also be responsible for attending at least one meeting of each chapter in their designated region; hosting an education seminar/idea sharing event directed to YPN concerns; and promoting YPN membership at meetings and through networking events. Employees and volunteers, ages 18-35, are eligible to join the YPN.
 
The network is a dues-supported initiative of the PCUA. Mid-Atlantic Corporate FCU has been a sponsor.

JPMorgan Reaches $13 Billion Deal With U.S. Justice Department

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NEW YORK (10/22/13)--JP Morgan Chase has reached $13 billion settlement agreement with the U.S. Justice Department to settle charges that it sold low-quality mortgage-backed securities sold in the run-up to the 2008 financial crisis.
 
The provisional agreement does not include a criminal investigation of the bank's conduct. The agreement includes $4 billion in relief for unspecified consumers and $9 billion in payments and fines, according to another person briefed on the terms (Bloomberg Oct. 21).  The payouts would cover a $4 billion accord with the Federal Housing Finance Agency over the bank's sale of mortgage-backed securities
 
The bank is expected cooperate in criminal inquiries of individuals involved in the conduct at issue as part of the deal, Bloomberg reported.
 
The broad outline of the deal was reached Friday in a telephone call among U.S. Attorney General Eric Holder, JP Morgan CEO Jamie Dimon, JPMorgan General Counsel Stephen Cutler and Associate U.S. Attorney General Tony West. The details of the agreement are still being negotiated.
 
The settlement would represent more than half of JPMorgan's record $21.3 billion profit last year, the article said.
 
JP Morgan, the largest U.S. bank, has run into troubled with multiple federal regulators and authorities in several states and foreign countries over large trading losses, poor risk controls and probes into whether it manipulated financial markets.

CU System Briefs (10/21/2013)

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  • EAST PROVIDENCE, R.I. (10/21/13)--Crystal Ferreira, 27, of Fall River, Mass., pleaded guilty on Oct. 4 to embezzling over $437,000 from an East Providence, R.I. branch of Columbus CU. She faces up to 30 years in federal prison. Her sentencing is scheduled to take place in January. A former supervisor at the credit union, Ferreira allegedly stole large sums of money from Columbus' vault, ATM, and cash shipments, beginning in May 2012. Ferreira allegedly admitted to the scheme during an East Providence Police investigation about an unrelated robbery. The FBI assisted local law enforcement with the investigation (eastprovidence.patch.com Oct. 18) ...
  • DES MOINES, Iowa (10/21/13)--Jon Sarvis is set to become the next CEO of TMG Financial Services, a credit card agent issuer that partners with credit unions, community banks, and member-based associations. The announcement was made by TMGFS board of directors chair Patrick S. Jury. Sarvis has been the institution's chief financial officer for the past six years. TMGFS services more than 70,000 card members and manages $140 million in assets ...
  • ALBANY, N.Y. (10/21/13)--The Credit Union Association of New York has promoted three employees. Allison Barna was named the head of the Albany-based trade association's member services team and charitable foundation, in addition to being named vice president of member services for the New York Credit Union Foundation. She was previously director of NYCUF/Community Development. Mindi Schwab was named CUANY communications director. She'll be overseeing communications strategies of CUANY, its affiliate companies and the foundation. She was previously a communications manager. Deborah Testa has been named CUANY marketing director, and will be overseeing marketing strategies of CUANY, its affiliates and the foundation. She previously served as a marketing manager for association services and has been with CUANY for 15 years ...
     
  • RALEIGH, N.C. (10/21/13)--Medical professionals, representatives from related charities and employees of the State Employees' CU in Wilmington, N.C. recently celebrated the groundbreaking of the SECU Family House at New Hanover Regional Medical Center. The 24-guestroom facility is expected to provide affordable accommodations for out-of-town patients and patient's families. Last December, SECU members and the SECU foundation announced a $2 million challenge grant for the Family House's construction ...

N.C. CUs Discuss Elderly Abuse, New Reporting Guidelines

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RALEIGH, N.C. (10/21/13)--More than 80 representatives from credit unions and community banks here attended a North Carolina Credit Union League conference on the financial exploitation of senior citizens and how to prevent it (The Weekly Conversation Oct. 18).

The gathering, held at the Local Government FCU Conference Center in Raleigh last week, featured experts who spoke on an array of
A speaker addresses conference attendees at the North Carolina Credit Union League's conference on the financial exploitation of the elderly in Raleigh.  (North Carolina Credit Union League Photo)
pertinent issues, ranging from new state and federal reporting guidelines to help identify elder financial abuse  to regular schemes used to steal from vulnerable adults.

"This is certainly a timely topic," John Radebaugh, league president/CEO, said during his opening remarks. He noted that federal regulatory agencies recently issued guidelines to clarify provisions of the Gramm-Leach-Bliley Act that allow financial institutions to report suspected fraud and abuse of the elderly.
 
The first panel broke down new reporting requirements mandated by the state of North Carolina, and the best practices credit unions and community banks have implemented in response. By Dec. 1, the state's financial institutions are required to report suspected cases of fraud or abuse when the victim is a disabled adult or over the age of 65.

Attendees were also reminded of the reporting guidelines for the state's Adult Protective Services in general cases of elderly abuse and neglect, a new prosecutorial program designed specifically for financial exploitation, and common scams used to defraud the elderly.
 
Speakers included representatives from the Conference of District Attorneys, the Consumer Protection Division of the Attorney General's Office, the federal Consumer Financial Protection Bureau, and a special agent with the State Bureau of Investigations' Financial Crimes Investigation Unit.

After the federal government published criteria for financial institutions reporting financial exploitation of senior citizens, National Credit Union Administration Chair Debbie Matz urged credit unions to ensure that their staff members are "trained on the potential signs that might trigger a report of elder abuse or financial exploitation" (News Now Sept. 25).

"Elder abuse involves the illegal or improper use of an older adult's funds, property or assets," she wrote. "Older adults can become targets of financial exploitation by family members, caregivers, financial advisors, home repair contractors, and scam artists."

She urged credit unions to review their own policies "to ensure they are consistent with state law and the interagency guidance regarding reporting requirements when a financial institution suspects elder abuse or financial exploitation."
 
In addition to the league's gathering, Champion CU, based in western North Carolina, hosted an elder fraud and financial exploitation conference on Oct. 10 in Canton.

U of Illinois ECU Vies for School's Endorsement

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CHAMPAIGN, Ill. (10/21/13)--When the University of Illinois Employees CU submits its request for proposal to become the exclusive banking partner of the University Illinois in first quarter of 2014, E.J. Donaghey, UIECU president/CEO, hopes to stress the difference between credit unions and banks to university officials. TCF Bank, the university's current partner, has made that task a bit easier for Donaghey and the credit union.  
 
The U.S. Public Interest Research Group analyzed complaints submitted to the Consumer Financial Protection Bureau (CFPB) and found that TCF Bank customers are the most likely to complain about their banking experience (Chicago Tribune Sept. 17). Wayzata, Minn.-based TCF ranked No. 1 nationally, with 24.9 complaints per billion dollars of deposits. That's nearly three times the ratio of the No. 2 bank, Sovereign Bank in Boston.
 
Donaghey has worked with students who have been less than pleased with the TCF banking experience. He told the story of one student who was hit with $400 in inactivity fees when she returned home to India for a couple of months. "And TCF will not reverse those fees," Donaghey said.
 
The CFPB has opened an inquiry into the deals between universities and big banks (ABC News Sept. 5). Banks often see students as little more than "dollar signs in backpacks," said Rohit Chopra, CFPB student loan ombudsman and assistant director.
 
Donaghey believes his credit union offers an alternative to that approach. "Part of our offer to the university will be that because we are a cooperative, because we are a credit union, we are going to provide low-fee accounts and we're going to be more flexible," Donaghey said. "We currently have a plan in place where we provide on-campus financial literacy. We'll certainly emphasize that we will give students a second and third chance, whereas these banks really do gouge students because they assume Mom and Dad are going to pay the bills."
 
The credit union established a strong link to the University of Illinois Alumni Association (UIAA) when it won the contract to provide a Visa-branded card to the association's 625,000 members. The contract replaced the alumni association's relationship with Bank of America.
 
According to an annual report on college credit cards, submitted in October by the CFPB to Congress, UIECU opened the largest number of new college credit card accounts during 2011 (News Now Nov. 28, 2012)
 
During 2011, the credit union opened 3,452 new accounts, which moved it up four notches to the top spot. That compares to 779 new accounts it opened in 2010, when it ranked fifth in the nation. UIECU's affinity card is marketed to the university's alumni, fans and credit union members, but not students.
 
The UIAA sought a financial services partner with a "clean" image in the wake of the Wall Street meltdown when it partnered with the credit union in 2010, said Greg Robinson, UIECU's chief operating officer.
 
"A lot of our success in earning the alumni association's business was saying, 'Here's how your members will be taken care of,'" Robinson said.  "The same holds true in this RFP process. We can tell them, 'This is how we're consumer friendly. This how we built our fee structure. Not because we're changing to accommodate students, but because this is how we've built this credit union over the years.'"

U.K. Proposes Tax On Payday Lenders To Fund CUs

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LONDON (10/21/13)--A member of the British Parliament has unveiled plans to tax payday lenders and use the money to fund low-cost alternatives such as credit unions.

British Labor Leader Ed Miliband said his party aims to raise enough cash to double the US$20.8 million the government now provides each year to the fund to expand credit unions (Standard Oct. 17).

Credit unions are being touted as alternatives to the high-cost payday lenders by the Archbishop of Canterbury, who has waged war on payday lenders by forming a credit union during the summer for clergy and urging others to support credit unions.

Payday lenders in Great Britain have been widely criticized for exorbitant interest rates that can reach 5,000% a year. The party has already proposed a cap on credit.

Speaking at a credit union in South London on International Credit Union Day Thursday, Miliband said the prices families pay keep rising faster than wages they are paid. As a result, the payday loan market has doubled in the past four years. Nearly one-third of the loans are to cover gasoline and electricity bills, he said.

Minn. CUs For Kids Invited To State CMN Collaboration Forum

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MINNETONKA, Minn. (10/21/13)--Two Minnesota credit union leaders were invited to participate in a Children's Miracle Network Hospitals state fundraisers' collaboration forum.

The invitation signifies the importance of Minnesota Credit Unions for Kids (MnCU4Kids) as a state sponsor for the network, said the Minnesota Credit Union Foundation.

MnCU4Kids Co-chairs Marlo Hirl of General Mills FCU, Minnetonka, and David Engler of Hiway FCU, St. Paul, were among the invited guests.

The forum is a biannual event that brings together representatives from the Children's Miracle Network Hospitals premier corporate sponsors, including Credit Unions For Kids, WalMart, Costco, Ace Hardware, Super America, Dairy Queen, Marriott and RE/MAX.

Credit unions are the third largest corporate contributor to Children's Miracle Network Hospitals annually. Credit Unions for Kids has raised more than $100 million for hospitals since its inception in 1996.  In 2012, MnCU4Kids raised more than $200,000 through support from credit unions, their members, and local and national companies--such as CO-OP Financial Services--that work with credit unions.

Hirl noted the success of MnCU4Kids and the opportunity to share its successes and collaborate with others. "It's very valuable to hear from other fundraising organizations and to discuss events and strategies around the charitable work that we're doing to support Gillette [Children's Specialty Healthcare] and CMN," Hirl added.

Digital Payments Hit Critical Mass: Survey

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BROOKFIELD, Mass. (10/21/13)--Digital payments have hit critical mass, with 60% of consumers surveyed making a payment at least once a month using a laptop or desktop computer,  30% paying via their mobile phone and 22% through their tablet.
 
The 2013 "How Americans Pay Each Other" national survey of 2,500 Americans, which evaluated person-to-person (P2P) payments or social payments, was conducted by Fiserv Inc. The Brookfield, Wis., financial services technology solutions provider has a social payment service called Popmoney.
 
The survey has implications for credit unions. Although P2P payments typically use cash and checks, a key finding was that most respondents were interested in a digital payment option from their financial institution. That would be another opportunity for credit unions to step in with solutions to consumers needs.
 
Eighty-eight percent of U.S. consumers surveyed sent money to someone else in the past 12 months. Of those, 56% used cash; 41%, a check; and 31%, an online method such as a bank-based P2P payment service or PayPal. 
 
The single most common way to exchange funds was giving cash in person (33% did so).  However, nearly one-third said they never have enough cash on hand to pay someone back. That number rose to 39% among 18- to 24-year-olds.
 
Of those surveyed, 79% said they would be open to using a digital P2P payment service from their financial institution.
 
"While digital payments are not common for things such as paying bills, there has not really been a practical way to send money to another person electronically," said Tom Roberts, senior vice president of marketing, electronic payments, at Fiserv.  "Services like Popmoney, which allows users to send or receive money using an e-mail address or mobile number, are changing that. Just as the ways people communicate with each other have become more digital, their payments to each other are becoming more digital as well."
 
Other key findings:
  • People most often gave or sent money to friends and family members, but age and gender play a role in who receives the payment and how the payment is sent. Roughly 41% gave money in the past year to friends, 41% to children, 36% to parents and 42% to other family members. Younger consumers were significantly more likely to give or send money to friends.
  • The money exchange between parents and children isn't a one-way street:  56% of Gen Y respondents and 35% of Gen X respondents said they have given or sent money to their parents in the past year. Women gave to their children, while men were more likely to give to friends, significant others, co-workers or roommates.
  • Splitting bill payments is the norm among U.S. households, with 46% reporting that one person pays the bills and others pay them back for all or part of the costs. Of those, 22% reported using a joint bank and 14% said one person pays some bills while another person pays the rest. Sixty-nine percent of those who share bill-payment responsibilities with a friend or roommate have one person pay the bills while others pay their share to that person, and 42% of married couples do the same. The number of married couples paying each other for bill payments was significantly higher among younger generations (64% among 18-24-year-olds and 57% of 25-34-year-olds).
  • People are uncomfortable requesting money owed to them. Nearly 50% said they have let people not pay them back because they didn't want to ask.
 

Cloud Computing: Don't Delegate Security Responsibilities

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MADISON, Wis. (10/21/13)--There's no way to eliminate all risks involved with cloud computing, but those risks certainly can be mitigated, Rick Roy, senior vice president/chief information officer for CUNA Mutual Group, told Credit Union Magazine.

(This article, which originally appeared in the September issue of Credit Union Magazine, is adapted from the October issue of the Credit Union National Association's Director newsletter.)
 
For starters know the cloud provider: Is it a startup business or does it have a proven track record? Has it invested sufficiently in the security measures needed to protect sensitive data?
 
"Many companies have aspirations to be cloud providers of something--they might be software or hardware companies that feel the need to transform their own businesses because of this trend," Roy said. "Don't get into an arrangement with someone who aspires to do this but doesn't have a clue how."
 
Also, don't delegate responsibility for the relationship. Sometimes credit unions have a tendency to "hand the keys over to someone else so they don't have to worry about it," Roy said. "But you still need to worry and pay attention. There aren't too many autopilot solutions out there; they tend to need care and feeding."
 
This is where ongoing due diligence comes in. Roy comparedvendor selection to dating, when "everyone has their best foot forward. But once you're in the relationship, make sure, through ongoing dialogue and audit discussions, that the security standards continue and the vendor continues to protect your information."
 
Equally important is making sure the vendor continues to invest in its infrastructure so it provides a high level of service and availability, he added.
 
CUNA Mutual conducts a "formal business check point" each quarter with its cloud providers to examine the relationships, investments in infrastructure, new product releases, and other elements, Roy said. "It's definitely a business conversation, and security is part of that conversation." The company also administers a security-specific review and questionnaire annually to ensure all parties "are doing what they signed up for," he added.
 
Even a contract doesn't absolve credit unions from ongoing due diligence. "When it comes to data privacy, you're getting at the core of a trust issue between yourself and the member," Roy said. "It's the difference between a financial risk and a reputational risk. Don't underestimate the reputational risk of something bad happening--because your business is built on a foundation of trust. There's not enough contractual language on the planet to overcome that."

Vermont FCU Hosts Peruvian CU Delegation

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SOUTH BURLINGTON, Vt. (10/18/13)--Vermont FCU hosted representatives from AELUCOOP, Peru's second largest credit union, last week (Newslines Express Oct.17).
 
A delegation from AELUCOOP, Peru's second largest credit union, visits Vermont FCU,  Burlington, Vt. The two cooperatives struck up a partnership through the Association of Vermont Credit Unions, its Peruvian counterpart, FENACREP, and the World Council of Credit Unions. (Photo provided by the Association of Vermont Credit Unions) 
The exchange, organized by the World Council of Credit Unions, allowed the Peruvian delegation to learn about VFCU's lending, marketing, information systems, operations, human resources, risk management and accounting strategies.
 
AELUCOOP representatives were given tours of VFCU branches in Burlington, South Burlington, and Milton. They also toured the Association of Vermont Credit Unions' Colchester office, and were given an orientation by AVCU President Joe Bergeron and some of his staffers.
 
AVCU is a participant in the World Council's International Partnerships program, through which it has an agreement with the Peruvian credit union trade association, FENACREP.
 
AELUCOOP and Vermont Federal first agreed to a formal working relationship in October 2010, when they signed an agreement through the World Council. In October 2011, VFCU representatives visited AELUCOOP facilities in Lima.
 
"The relationship between AELUCOOP and Vermont Federal is one of the many examples of the collaborative spirit and efforts that have become commonplace in the credit union movement," Bernie Isabelle, VFCU president/CEO said. "The information disseminated and the friendships developed have helped us all in our ultimate goal of serving our members."
 
Jean Giard, VFCU senior vice president of finance and chief financial officer, who went on the 2011 trip to Peru, said the program is "is about exchanging ideas, best practices and an opportunity to see the credit union movement applied in different cultures."
 
VCFU is headquartered in Burlington, Vt. and has $393 million in assets.

CU System Briefs (10/18/2013)

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  • HONOLULU, Hawaii (10/18/13)--The board of directors of Aloha Pacific FCU named Vince Otsuka its president/CEO on Wednesday. Interim president since the April retirement of Wallace Y. Watanabe, Otsuka was previously Aloha Pacific's senior vice president of lending. He's the credit union's third president, after Watanabe and Masami Oishi. Aloha Pacific FCU is located in Honolulu and has $756 million in assets...
  • LIVE OAK, Texas (10/18/13)--Randolph-Brooks FCU (RBFCU) helped the Senior Citizens Program of Wilson County purchase new tires for its Meals on Wheels program. Betty Manak, a program coordinator for the charity, said that a donation camefrom the credit union just 24 hours after she reached out for help. Workers for the program deliver meals to senior citizens within a 75- to 100-mile radius around Floresville, Texas five days a week. "RBFCU's focus is on people helping people," said Lorena Bourland, the Floresville branch manager. "We are committed to helping people like Ms. Manak succeed in their mission of serving the community." The tires were purchased at a discount from Ancira Ford in Floresville. The Senior Citizens Program in Floresville is open to members of the community over the age of 60. Randolph-Brooks FCU is located in Live Oak, Texas, in the San Antonio area. It has $5.51 billion in assets. The picture, from left to right, includes Ralph Rodriguez, RBFCU business development director; Bourland; Manak; and Ancira Ford General Manager Andy Horny. (Photo provided by Randolph-Brooks FCU)...

Don't Tax Campaign Sees More Action In CUs, Press

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MADISON, Wis. (10/18/13)--Credit unions--even those competing against each other--are using their cooperative spirit to join together to preserve credit unions' tax status against banker attacks. In Charleston, S.C., and Eugene, Ore., credit unions worked together to deliver the Don't Tax My Credit Union message.
 
Two Charleston, S.C., credit union CEOs teamed up to present that message to viewers of ABC News in Charleston.  Scott Woods, CEO of SC FCU, and James Gergen, CEO of CPM FCU, urged consumers to call their senator or congressman and tell staff who answer the phone, "Don't Tax My Credit Union." They also urged viewers to go to the Don'tTaxMyCreditUnion.org to weigh in on the tax issue.
 
"As a rule credit unions work together very well within the cooperative network. We're competitive, but there's plenty of business opportunity for everyone," said Woods, adding that credit unions "offer a greater balance of competition in the community, even for nonmembers."
 
Gergen noted that the Don't Tax campaign is a national effort by credit unions "to ensure financial choice remains out there for consumers and small businesses." As non-for-profits, "if we would have to pay taxes, we'd have less money to take care of the member." Credit unions have "got under banks' skin" because they pay more on deposits, take less on loans and have low or no fees, he said.
 
In Eugene, Ore., three credit union CEOs--Mandy Jones of Oregon Community CU, Bob Newcomb of Selco Community CU, and John D. Iglesias of Northwest Community CU-- demonstrated credit unions' "Unite for Good" collaboration to tell the value of credit unions.
 
Their conversation spans three videos covering credit union values, the credit union experience, and taxation. "You would not get three banks sitting in a room together trying to tell their story," said Jones. "Credit unions are united--we're all in this together."
 
"We have so many examples of how credit unions have returned what we earn," said Iglesias. "We make profits but what we do with that profit is the huge difference" between credit unions and banks, he said.
 
Banks focus on the bank statement, maximizing profit and "enriching individuals rather than giving back to the community," said Newcomb. He pointed out that during the economic downturn in 2007, credit unions increased their lending 13% while banks cut back lending 3%. "Credit unions help members solve problems not just get a payment due."
 
Credit unions were established "to help the common person and from our inception have been there to help meet the basic financial needs of consumers," said Iglesias. "Taxation would really effect that."
 
Congress is struggling with the federal deficit and has two choices: reduce expenses or increase revenues, said Jones. That raises concerns of possibly losing credit unions' tax status. "We are not tax-exempt. We do pay taxes, for property, payroll and several other taxes," she said.
 
"If you are taxed like a bank, some will say you may as well operate like a bank," said Newcomb. "Credit unions are an alternative to the for-profit banks. Member choice is very important."
 
If credit unions are taxed, "then consumer choice has gone out the door," said Jones.
 
The three CEOs urged viewers to visit Don'tTaxMyCreditUnion.org.
 
Other articles related the benefits of credit unions to communities and members and the importance of working on a united front to preserve the tax status. They included an article in the Sioux Falls Business Journal (Oct. 15), which featured popular services of local South Dakota credit unions and how their success has drawn banks' attention.
 
Robbie Thompson, president/CEO of the Credit Union Association of the Dakotas, noted in the article that banks and credit unions "are different models. The bank model is to generate a profit from customers for a small number of shareholders. The credit union model is cooperative, where all profits are returned back to the members who are also the owners."

Co-op Month: Study Reveals Strong Preference For Co-ops

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MADISON, Wis. (10/18/13)--Seventy-four percent of consumers in Minnesota and Wisconsin prefer to do business with cooperatives, including credit unions, based on past experience,  according to a St. Norbert College Strategic Research Institute Survey commissioned by Cooperative Network.
 
Click to view larger image North Dakota Gov. Jack Dalrymple proclaimed October Co-op Month in the state. Representatives included, from left, Jeff Olson, Credit Union Association of the Dakotas; Stan Vagness, North Dakota Association of Telecommunication Cooperatives; Mike O'Keeffe, Farm Credit Services of Mandan; Dennis Hill, North Dakota Association of Rural Electric Cooperatives; Dalrymple; Woody Barth, North Dakota Farmers Union; Carl Younce, CHS; and Larry Holst, Land O'Lakes. (Photo provided by Credit Union Association of the Dakotas)
October is International Co-op Month. This year's theme is "Collaborate, Communicate, Cooperate," illustrating a proven, grassroots alternative for economic progress.
 
When asked about financial services providers, 61% of survey respondents said they would prefer the services offered by a credit union. About 66% percent of Wisconsin residents chose a credit union, while 55% of Minnesota residents preferred credit union services.
 
Cooperative Network's 2013 co-op study was funded by CHS Inc., a global agribusiness owned by farmers, ranchers and co-ops nationwide. In the study, the research institute randomly polled 400 people in Minnesota and Wisconsin about their opinions and use of cooperatives, and it contrasted the results to a comparable study performed in 2007, prior to the U.S. financial crisis.
 
Other notable findings included:
  • 47% of respondents indicated there was at least one family member who belonged to a co-op, compared to 36% in 2007.
  • 69% of people who ran a business within their home were also members of a co-op, statistically similar to 2007 results.
  • 18% of people associated the words "teamwork/collaboration" with "co-op" or "cooperative"--a correlation that did not appear in the 2007 study.
In North Dakota, Gov. Jack Dalrymple proclaimed October as "Co-op Month" to recognize the valuable contributions that cooperatives bring to the state. Based on data provided by the North Dakota Secretary of State, 332 businesses operating in North Dakota identified themselves as cooperatives in 2012.  
 
The total economic value of all cooperative-related business operating in North Dakota generated or induced $22.6 billion in the state's economy, according to a recent study by the Quentin Burdick Center for Cooperatives at North Dakota State University.

ICU Day Proclamations Ring Out As CUs Tell Their Stories

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MADISON, Wis. (10/18/13)--
Click to view larger image Click for larger view
While political officials proclaimed yesterday as the 66th annual International Credit Union Day, credits unions and leagues "United for Good" by telling their stories, educating the public about credit unions, and celebrating with nearly 200 million members in nearly 100 nations worldwide.
 
National Credit Union Administration Board Chairman Thursday urged credit unions across the country to reach out to the next generation of credit union members. ICU Day "is an ideal occasion for credit unions to highlight their traditions of stability, personal service and community involvement to attract new and younger consumers," she said.
 
Click to view larger image Teams of employees, members and friends of Wichita, Kan.-based Meritrust CU worked assembly style to package 20,000 meals in 90 minutes for a South Africa orphanage as part of Meritrust's International Credit Union Day activities. The ICU Day theme "Credit Unions Unite for Good" helps leverage the credit union initiative of working together to better the lives of individuals, families, communities and countries around the world, said the credit union. (Photo provided by Meritrust CU)
"Credit unions should use this day to evaluate how they are engaging young people, and if they are providing the products, services and conveniences that younger generations have come to expect," Matz said.  "With effective outreach to America's youth, credit unions can ensure the industry's future viability, and in so doing, meet the financial services needs of the next generation of Americans."
 
Messages proclaiming the day from the Credit Union National Association and the World Council of Credit Unions were reported in News Now Thursday.
 
Governors of several states--Arkansas, Oklahoma, Texas and Connecticut among them--added their proclamations or statements acknowledging credit unions' day and the work they do.
 
Click to view larger image Staff at Telcoe FCU, Little Rock, Ark., formed a hexagon on the floor of the credit union in their International Credit Union Day T-shirts that display this year's theme, "Credit Unions Unite for Good." (Photo provided by Telcoe FCU)
Many leagues offered messages, too.  Association of Vermont Credit Unions President Joe Bergeron and his staff recorded ICU Day greetings on video, said Newslines Express (Oct. 17). Use the link to access the video.
 
Georgia Credit Union Affiliates noted the theme with a statewide Switch to Save campaign to encourage Georgia residents to stop by a credit union for a loan review and to see how credit unions can save them money on loans.
 
Cornerstone Credit Union League CEO Dick Ensweiler shared stories in the Leaguer Thursday about Western Sun CU's "Choose My Wish" initiative in Broken Arrow, Okla.; Abilene (Texas) Teachers FCU employees participating in the March of Dimes; and VA Hospital FCU CEO George Bujarski in Little Rock, Ark., participating in financial education workshops at a local high school.  "Whether it's reaching out to youth via financial education, helping to solve a social concern in the community, or raising funds for a good cause, credit unions rise to the occasion," Ensweiler said.
 
Credit unions themselves celebrated a number of ways, including by sharing photos and messages in #ICUDay tweets. To get a flavor for the enthusiasm and creativity credit unions displayed during the day, check out Credit Union Magazine's ICU Day page (Use the link).
 
Click to view larger image Star of Texas CU celebrated International Credit Union Day in Austin, Texas, by inviting members for refreshments (The Advocate Oct. 17). From left are Sherry Han, vice president of operations; Frances Laurel, CEO; Ruben Hernandez, assistant vice president consumer lending; and Carla Trager of the Cornerstone Credit Union League. (Photo provided by the Cornerstone Credit Union League)
Some credit unions celebrated by helping others. In Wichita, Kan., Meritrust CU's members, employees and friends assembled 20,000 meals for international hunger relief organization Numana on Saturday. The meals will be shipped to an orphanage in northern South Africa, the Tabitha Ministries.

"This event was meaningful to the community focus of credit unions in two ways," said Meritrust President/CEO James Nastars. "One, we joined with our co-workers and friends, coming together as a community to make a difference in the lives of those in need. Two, in our globally connected world, community encompasses groups or persons both near and far. It's the credit union way to reach out to those in need, wherever they might be."
 
Some raised awareness in the media of credit unions. Thursday's Harrisburg, Pa. Patriot-News featured an eight-page credit union-sponsored insert with ICU Day graphics and articles about the history of credit unions, the benefits of membership and services provided, said the Pennsylvania Credit Union Association (Life is a Highway Oct. 17). It included a Unite for Good coloring page. In addition to a PCUA-placed iBelong ad, sponsoring credit unions included Hersehy FCU, Members 1st FCU; New Cumberland FCU, and PSECU.
 
Also, the Northeast PA Chapter of Credit Union sponsored its annual newspaper greeting with 10 Credit Union History Facts, which point out how credit unions originated, the pioneers who brought the idea to North America and more.
 
Pacific Marine CU, Oceanside, Calif., and Lakota FCU on the Pine Ridge Reservation in Kyle, S.D., used the day to tell members and nonmembers who they are and the services they provide as well as what credit unions are in articles in SanDiego.com and Indian Country (Oct. 17).
 
ICU Day has been celebrated on the third Tuesday of October since 1948.

ASmarterChoice Grabs 32,266 Visitors Since August

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MADISON, Wis. (10/18/13)--ASmarterChoice, the website launched by the Credit Union National Association and state credit union leagues to help consumers find a credit union to join, attracted 32,266 visitors between Aug. 31 and Oct. 15.
 
"ASmarterChoice continues to spread its message across social media, increasing its followers and reach," said Amaia Kirtland, CUNA social and digital media manager. "By adding additional content from the leagues and their member credit unions, we can build upon this growing trend. By focusing on returning visitors, we can help ensure they choose a credit union as their preferred financial institution."
 
About 82% of the visitors were new to the site and 17.4% were returning visitors. 
 
The ASmarterChoice Facebook page garnered 7,156 likes as of Oct. 15, an increase 7,122 followers on Aug. 31.  Its Twitter account counted 1,567 followers, up from 1,476 followers on Aug 31.  
 
Future plans for the web site include a blog that will highlight the credit union difference, encourage visitors to become credit union members, offer financial education and spotlight the efforts and activities of credit unions in their local communities.  
 
The site architecture also will be updated to better adapt to mobile and smart tablet devices, which will increase site functionality and accessibility. The site will incorporate more infographics, pictures and video for sharing content and link backs. These developments are expected to be in place by early 2014.

Rock Star Paul Phillips: A Heart For Service

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MADISON, Wis. (10/18/13)--At a strategic planning session a few years ago, directors and key executives at Freedom First CU, Roanoke, Va., focused on one vital question: "If we weren't here, who would care?"
 
From the discussion arose a new commitment. "We said, 'Let's be different,'" recalled Paul Phillips, the credit union's president/CEO.
 
Credit Union Magazine is celebrating the credit union movement's rock stars--those ordinary people who manage to pull off the extraordinary--in honor of International Credit Union Day, which was Thursday. Today News Now will highlight the fourth and fifth rock stars of the week.
 
Under Phillips' leadership, Freedom First embarked on a bold effort to serve people who lack access to traditional financial institutions.
 
"In doing so, we've breathed new life into the credit union and given our work purpose," Phillips said. "Our skill sets are evolving to include such things as grant writing and leading community collaborations to do things for-profits either would not or could not do. It's been a fun journey."
 
In 2010, Freedom First obtained designations as a community development credit union, a low-income credit union, and a community development financial institution. It also created products and programs designed specifically for low-income people, who comprise 61% of the credit union's members.
 
One such program is Responsible Rides, a collaboration with community nonprofits and Enterprise Car Sales. Borrowers get not only a loan, but also classes in personal finance and vehicle maintenance.

Rock Star Bob Stowell: Inner Fire Fuels Desire To Serve Others

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MADISON, Wis. (10/18/13)--When Bob Stowell isn't performing his duties as a Minnesota credit union executive, he might be off in Haiti mixing concrete for a village well-house construction project.
 
Or he might be administering polio vaccine drops to children at a clinic in India.
 
Such activities are part of Stowell's volunteer work through Rotary International, which sponsors projects that improve life for people around the globe.
 
"There are parallels between credit unions and Rotary," said Stowell, senior vice president/chief operating officer at US FCU in Burnsville, Minn. "Rotary serves others, and so do credit unions. Our credit union takes great pleasure in helping our members secure their financial future."
 
Credit Union Magazine is celebrating the credit union movement's rock stars--those ordinary people who manage to pull off the extraordinary--in honor of International Credit Union Day, which was Thursday. Today News Now will highlight the fourth and fifth rock stars of the week.
 
For Stowell, the urge to help others goes back to childhood. He grew up enduring parental abuse and neglect. When he left home at age 18, he was six feet, two inches tall--and weighed 120 pounds.
 
"Food was rationed at home," he recalls, "so I was starved, always hungry. The truth is, when you're hungry, nothing else matters."
 
But those bad memories turned into major motivators years later. "I don't want people in the U.S. or any country to be deprived of water or food," Stowell says. "I don't want others to have to live the life I had."
 
After leaving home, he signed up for a four-year stint in the armed services, which included a year in Vietnam. Eventually, he finished college and embarked on a banking career. Stowell also searched for a service organization to fulfill his personal motivation to make a difference--and that's when he discovered Rotary.
 
He's been at US FCU since 2006 and is active in the CUNA Operations, Sales & Service Council and the CUNA Lending Council, where he serves as secretary-treasurer.
 
Over the years, Stowell has made several trips overseas to work at or visit Rotary projects. He has seen with his own eyes the impact these projects have.
 
Whether it's his volunteer work or his credit union day job, Stowell relishes working in an environment that values cooperation. "The credit union philosophy mirrors my personal philosophy," he said. "It's about finding ways to give others hope."

Young Wisconsinite Can Save $117K In Lifetime Using a CU

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PEWAUKEE, Wis. (10/18/13)--A young person in Wisconsin can expect to save slightly less than $117,000 from a lifetime of credit union membership, according to Federal Reserve data.
 
The number was touted yesterday by the Wisconsin Credit Union League in honor of International Credit Union Day.
 
"Saving well over $100,000 could help offset the many costs of higher education, raising a family, beginning a retirement nest egg, or pursuing a passion, like launching a small business," said Brett A. Thompson, president/CEO of  the league. "And that figure doesn't even take into consideration additional savings realized by consumers from the lower and fewer fees that are typical at credit unions."
 
Broken down, the $116,942 in savings calculated by the Federal Reserve Survey of Consumer Finances shows that credit union membership nets members over their lifetime:
  • $5,163 on car loans;
  • $44,784 on mortgages;
  • $59,120 in home equity;
  • $5,819 on savings certificates; and
  • $2,056 on checking and savings accounts and other surcharges, including ATM fees.
Since the start of the recession in 2007, the league said, the state's credit unions have saved 2.4 million members over $1 billion.
 
The league noted that potential members can visit ASmarterChoice website operated by the Credit Union National Association--to locate a local credit union to join.

CU System Briefs (10/17/2013)

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  • KANSAS CITY, Mo. (10/17/13)--United Labor CU has been named the winner of the 2013 Missouri Excellence Award, given by the Small Business Institute for Excellence in Commerce (SBIEC). The Kansas City-based credit union was chosen for outstanding business ethics and organizational values, according to the Missouri Credit Union Association (Missouri Difference Oct 16.). The SBIEC picks the winner of the award through business surveys and industry research to honor small enterprises that demonstrate contributions to their local business environment and industry ...
  • ST. LOUIS, Mo. (10/17/13)--John L. Irvin Jr., former chairman of the Missouri Credit Union Association board and a former director of the Kansas Credit Union League (now Kansas Credit Union Association), has died at the age of 87 (Missouri Difference Oct. 10). He served as head of the MCUA board from 1965 until 1967, when the organization was called the Missouri Credit Union League. Arnold Sandbothe, a former employee of MCUA, described Irvin as an innovator. "He was not only a professional credit union executive, but held numerous volunteer positions that influenced untold positive outcomes for the success of credit unions of today," he said. "His volunteerism not only reached top elected positions in Missouri, but also in neighboring Kansas and on the national level." Irvin was the CEO of Yellow Freight CU from 1966 until 1985, and the president of Central CU from 1985 until 1991. He also was active with the Kansas City Chapter of Credit Unions and the Kansas City Credit Union Managers Association ...
 

Montana CUs Lead VITA Grant Procurement

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HELENA, Mont. (10/17/13)--A credit union-led coalition of community development organizations won a $76,800 Internal Revenue Service grant to help support Volunteer Income Tax Assistance (VITA) sites in Montana.

Montana Credit Unions for Community Development (MCUCD) heads the consortium--called the Montana VITA Partnership (MVP)--with Community Action of Northwest Montana, Human Resource Development Councils in Billings and Bozeman, Opportunity Link Inc. and the United Way of Yellowstone County all participating.
 
"Being part of a coalition makes us better," Carin McClain, MCUCD's VITA program manager said. "We are better able to serve taxpayers in our communities, advocate for our programs, and get the word out about important tax credits that benefit hard-working Montanans."

McClain predicted that the program will save taxpayers in the state "millions." The average taxpayer spends more than $220 preparing their income tax returns, according to the National Society of Accountants. Last year, more than 152 VITA volunteers prepared 5,515 tax returns in Montana.
 
Most households and individuals who make $51,000 or less qualify for the free income tax preparation service.

U.S., Canada, Australia Leaders Explore Collaborative Solutions

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SYDNEY (10/17/13)--
Click to view larger image At the international workshop on challenges facing credit unions worldwide are, from left: Credit Union Central of Canada President/CEO David Phillips, Credit Union National Association President/CEO Bill Cheney, Australia's Customer Owned Banking Association CEO Louise Petschler and World Council of Credit Unions President/CEO Brian Branch.
Credit union trade association leaders from the U.S., Canada and Australia met in Sydney last week for a symposium on collaborative solutions to shared industry challenges.

Conference topics included regulatory issues, advocacy, credit union branding, and consumer demands for modern payment systems. Discussions about regulatory constraints focused on Basel III, anti-money laundering statutes, the Foreign Account Tax Compliance Act, member business lending, and strategies about fostering member identification with the credit union brand.

The World Council of Credit Unions--led by President/CEO Brian Branch and Vice President Victor Miguel Corro--coordinated the exchange.

Click to view larger image U.S., Canadian and Australian credit union trade association leaders discuss key issues affecting member credit unions and how to respond to them. (Photos provided by the World Council of Credit Unions)
"The challenges are similar, the answers are sometimes different and participants gain new insights from this engagement to apply to their own credit unions and national systems," said Branch. "They also provide World Council with valuable lessons that we can share with the rest of the credit union world who face common regulatory, branding and payments challenges."
 
The American delegation, led by Credit Union National Association President/CEO Bill Cheney, stressed that Americans tend to choose credit unions when regulatory barriers to membership are minimized, and when they understand the difference between credit unions and banks.
 
The Canadian delegation was led by David Phillips, president/CEO of Credit Union Central of Canada, and the host delegation was led by Louise Petschler, CEO of Australia's Customer Owned Banking Association.
 
Joining the leaders were a number of trade association and credit union executives.

From the U.S., Cheney was joined by:
  • Susan Newton, CUNA executive vice president of system relations and American Association of Credit Union Leagues' executive director;
  • Patrick Jury, president/CEO, Iowa Credit Union League;
  • Diana Dykstra, president/CEO, California and Nevada Credit Union League;
  • Pat Wesenberg, CUNA chairman and president/CEO, Central City CU, Marshfield, Wis.; and
  • Dennis Pierce, CEO, CommunityAmerica CU, Lenexa, Kan.

From Canada, Phillips was joined by:
  • Daniel Burns, CUCC chairman;
  • Scott Kennedy, CUCC director;
  • Loretta Elford, CUCC director;
  • Stephen Fitzpatrick, CUCC vice president of corporate services and chief financial officer;
  • Wendy King, senior vice president of government relations, general counsel, corporate secretary and chief compliance officer, Central 1 CU; and
  • Michael Leonard, president/CEO, Atlantic Central.
Joining Petschler in hosting duties, was COBA head of public affairs, Mark Degotardi.

While in Australia, conference attendees visited a mutual bank and credit union--Bank MECU and Victoria Teachers Mutual Bank in Melbourne. The mutual banking sector in Australia includes credit unions, mutual building societies, mutual banks, cooperative banks and friendly societies, and many Australian credit unions have decided to become mutual banks because of regulatory pressures.

CUNA's Dunn Offers Regulatory Insight At NWCUA Conference

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PORTLAND, Ore. (10/17/13)--While Congress and regulators have introduced an abundance of new regulations in recent years, the Credit Union National Association remains steadfast in its efforts to ease the burden on credit unions, Mary Dunn, CUNA deputy general counsel, said during a breakout session at the Northwest Credit Union Association's Amplify Conference in Portland, Ore. last week.
 
"Working with the leagues and credit unions, CUNA's regulatory advocacy is proactive at all times and aggressive when needed," Dunn said.  "Our No. 1 regulatory advocacy priority is to pursue a positive regulatory environment for credit unions and minimize their regulatory burdens from the National Credit Union Administration, Consumer Financial Protection Bureau or whatever agency is involved to the greatest extent possible."
 
A strength of the credit union system in working with regulators is the strong partnership among CUNA, state leagues and credit unions, Dunn said.
 
That relationship also helps CUNA carry a unified message to lawmakers."Credit unions understand we are carrying that message the credit unions are burdened by regulation loud and clear to Congress," Dunn said.
 
CUNA continues to push for broad exemptions for credit unions on some CFPB rules, she said.
 
"Are they complete as we want them to be? No," Dunn told the group. And that is something we continue to work on," Dunn said.
 
CUNA's long-term strategy is to help regulators, including the NCUA, understand the regulatory burden credit unions face on a daily basis.
 
That includes even if a new regulation is needed, then considering if an existing regulation can be eliminated," Dunn said.

Rock Star Helen Estes: Credit Scores 'Don't Tell the Story You Need to Hear'

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MADISON, Wis. (10/17/13)--If you know only one thing about Helen Estes, it will tell you a lot.

Estes, loan officer at Old Dominion University CU in Norfolk, Va., detests credit scores. "I don't believe in them," she said. "They don't tell the story you need to hear. If you're going to lend money to somebody questionable, why charge an outrageous rate just to foreclose on them a year earlier?"

Credit Union Magazine is celebrating the credit union movement's rock stars--those ordinary people who manage to pull off the extraordinary--in honor of International Credit Union Day today, which is Thursday.
 
This is the second of five credit union rock stars News Now will highlight this week.
 
Estes' lending decisions run the gamut, from $100 consumer loans to $1 million mortgages. She recently helped an overseas professor who had a $450,000 down payment on a $1 million mortgage but couldn't get a secondary market-approved loan because he didn't have a credit score.
 
"I gave him the loan," she said, adding that everyone involved agreed the member was a good credit risk.
 
As a one-woman loan department, Helen is in a unique position to bend the rules to everybody's benefit. "Old Dominion accepts that I've occasionally made a wrong call, but they support my approach," she said.
 
Her openness to borrowers' stories doesn't mean she never says no. "The first time I had to say no, I was scared," she said. "It was difficult. I had to explain our policy and why this loan wouldn't work. Many times when I say no it's from a gut feeling."
 
She can be strict. "Sometimes I'll spend hours with a member, methodically contacting and paying off creditors," she said. "When we're finished, I say, 'This is the only time I'll do this for you. If you go back to these lenders again, where will you get the money to pay them off?'"
 
Helen meets with almost all applicants face to face. "They have to sit down and talk to me," she said. "I know the people I lend to and I know their stories."
 
If her answer is "no," she'll work with the member and explain the steps needed to make improvements before the credit union can offer services. "Sometimes they cry, and sometimes I cry right with them."
 
Honoring credit union rock stars is just one way credit unions and more than 196 million credit union members in 100 countries are preparing to "unite for good" with activities to today celebrate the credit union difference and demonstrate the value of credit unions.
 
This year's ICU Day theme, "Credit Unions Unite for Good," builds on the Credit Union National Association's Unite for Good campaign, which has rallied credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.

Governor, Coach Headline Indiana CU Convention

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INDIANAPOLIS (10/17/13)--
Click to view larger image At the Indiana Credit Union League's Annual Convention are, from left, League Governmental Affairs Committee Chair and league director George McNichols, Hoosier Hills CU; League Vice President Governmental Affairs Chris Beaumont; League Chairman Frank Gulley, Afena FCU; Indiana Gov. Mike Pence; League President John McKenzie; and Indiana Credit Union Political Action Committee trustee Dave Abernathy, Via CU. (Photo provided by the Indiana Credit Union League)
Indiana Gov. Mike Pence praised credit unions at the Indiana Credit Union League convention in late September.

Pence, a long-time supporter of credit unions, shared his appreciation for credit unions' role in Indiana's economic environment, said the league.
 
The Sept. 25-27 gathering, which featured a keynote motivational speech from Indiana University basketball coach Tom Crean, also served as a fundraiser for Samaritan's Feet--a charity that delivers new shoes to impoverished children in the U.S. and around the world.
 
"We were pleased to have more than 500 attendees at this year's 79th annual convention," said ICUL President John McKenzie. "They represented almost 90% of Indiana's 2.2 million members."

Next year's ICUL convention is scheduled to take place Oct. 15-17.

CUs Around the Globe Unite For Good Today--ICU Day

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MADISON, Wis., and WASHINGTON (10/17/13)--Today is the big day, where credit unions and their members around the world celebrate the 66th annual International Credit Union Day with the theme, "Credit Unions Unite for Good," and promote awareness of the credit union difference.
 
"International Credit Union Day is a great opportunity to celebrate everything that makes credit unions different," said Credit Union National Association President/CEO Bill Cheney.
 
"This year's theme is 'Credit Unions Unite For Good,' reminding us of all the excellent work that credit unions do for members and their communities. With over 200 million credit union members worldwide and growing, this day is also a great reminder of how far the credit union movement has come. We encourage all members to participate, and share their own personal story."
 
International Credit Union Day, celebrated on the third Thursday of October since 1948, often brings proclamations recognizing the value of credit unions to their members and community. Gov. Terry Branstad of Iowa and Gov. Mark Dayton of Minnesota have signed proclamations making today Credit Union Day in their states.
 
The proclamations say in effect that credit unions embrace the "people helping people" philosophy by pooling personal resources and leadership abilities for the good of the cooperative, "empowering members to improve their financial futures and untied to help those in need."
 
"On this day in Iowa, and all over the world, credit unions celebrate their common roots, the cooperative spirit and their community service achievements," said Iowa Credit Union League CEO/President Patrick S. Jury. "This is the day to celebrate credit unions as a robust alternative to for-profit banks," he said, noting that at credit unions, "people are more important than profit."
 
"For credit unions in Minnesota and around the world, International Credit Union Day is a time to recognize what the industry has achieved and to highlight the difference credit unions make in their communities. Credit unions truly unite for good wherever they are," said Minnesota Credit Union Network President/CEO Mark D. Cummins.
 
The Pennsylvania State Senate and State House of Representatives issued resolutions recognizing this week as Credit Union Week in Pennsylvania.  Sen. Don White (R-Indiana), chairman of the Senate Banking and Insurance, sponsored Senate Resolution 215, while Rep. Robert Matzie (D-Beaver), a member of the House Consumer Affairs Committee, sponsored House Resolution 464.  The resolutions recognize Pennsylvania's 499 credit unions as cooperatives, and their commitment to providing their 23.7 million members with low-cost financial services.
 
The World Council of Credit Unions has posted a Youtube video on its website with a "Happy International Credit Union Day" message from World Council Chair Grzegorz Bierecki and President/CEO Brian Branch inviting the world to join in the celebration. Use the link to view the video.
 
The National Federation of Community Development Credit Unions is celebrating its member CDCUs' "commitment to expanding financial inclusion to low-income families, new immigrants, young people, and an ever-growing number of Americans seeking alternatives to mainstream banks," said a message from Deyanira Del Rio, federation board chair, and President/CEO Cathie Mahon.

In the United Kingdom, the Archbishop of Canterbury has written to all clergy in the Church of England urging them to become "actively involved" in supporting credit unions. (Express & Star Oct. 16).

Some credit unions have reported what they are doing today:
  • Bay Winds FCU in Charlevoix, Mich., will host member appreciation events and accept donations for a local domestic violence shelter. It has invited members to stop by its branches from 9 a.m. to 5 p.m. today for refreshments and gifts.
  • Shell FCU, Deer Park, Texas, will be up early, hosting a free gas giveaway at the Wilson Road Shell gas station in Humble beginning at 7 a.m. The first 100 vehicles in line will receive $30 of gas pumped into their vehicle free.  Also, all Shell FCU branches will offer the chance to win a $50 Visa Gift Card to anyone who stops by today.
  • Everett (Mass.) CU has invited its members to visit and celebrate the cooperative spirit today. "The credit union movement is a united force based on camaraderie, cooperation and collaboration," the credit union said in the Everett Independent (Oct. 16).
  • Royal CU, Eau Claire, Wis., has invited its members and members of the community to enjoy free cookies and coffee at all RCU offices while supplies last.
  • In the United Kingdom, Darlington CU is highlighting some of its work in the local community through a junior savings program and is urging members to sign up for holiday loans program which helps members save money. "We want to use International Credit Union Day to get the message out there in Darlington that the credit union is very active and vibrant and we welcome all new members," said Tony Brockley, coordinator at the Darlington branch (The Northern Echo Oct. 16).
Many will be sharing their activities through social media. If tweeting about your activities, use the hashtag #ICUDay. For more information on using social media to celebrate, see News Now's story, Tomorrow's ICU Day will Connect With Social Media, by using the link.

Wesenberg, Cheney Stress Don't Tax My CU Message To CUNA Employees

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MADISON, Wis. (10/17/13)--Credit Union National Association President/CEO Bill Cheney and CUNA Chair Pat Wesenberg emphasized the importance of spreading the Don't Tax My Credit Union message Wednesday in comments at a meeting with CUNA employees in Madison, Wis.
 
Click to view larger image CUNA President/CEO Bill Cheney told CUNA employees in Madison, Wis., that credit unions are in "once in a generation" battle with banks over the credit union tax status.
Cheney and Wesenberg just returned from a World Council of Credit Unions meeting in Australia, where credit unions are taxed. Cheney and Wesenberg said the message from Australian credit unions was clear: U.S. credit unions should fight to retain their current tax status.
 
"Credit unions and banks that used to be called credit unions told us, 'Whatever you do, don't lose that battle; whatever you do, don't lose that battle. You've got to win,'" Cheney said. "'Once you lose, it's never the same again.'"
 
Much of the credit union culture has been lost in Australia, Cheney said. Most of Australia's largest credit unions have converted to banks. The former credit union association is now known as the Customer Owned Banking Association.

Click to view larger image CUNA Chair Pat Wesenberg, president/CEO of Central City CU, Marshfield, Wis., urged CUNA employees to continue to spread the Don't Tax My CU message to member credit unions during her comments at CUNA headquarters in Madison Wis. (CUNA photos)
"Can you imagine if we changed the name of the Credit Union National Association to the Customer Owned Banking Association in the United States?" Cheney said.
 
Wesenberg, president/CEO Central City CU, Marshfield, Wis., stressed the importance of CUNA employees continuing to emphasize the Don't Tax My CU message in their day-to-day work with credit unions.
 
"Anything that you can do to help get the message out, even if it's on a personal level, such as sending an e-mail to five of your contacts, asking them to reach out to their legislators, those efforts make a big difference," Wesenberg said.
 
Cheney also offered an overview of the tax reform as it relates to the U.S. government furlough and the debt ceiling debate.
 
"The concern is out of that will come sort of grand bargain," Cheney said. "And the banks see this as a generational opportunity to destroy credit unions. Their goal is not just to tax credit unions. Their goal is to eliminate the competition, which they did to the [savings and loan] industry."
 
But Cheney said credit unions can win the battle if they stay in constant contact with leaders of Congress.
 
"We need people in the room when this grand bargain is struck to say, 'You're not going to tax my credit union.' Then we've won for a generation," Cheney said.
 
So far, credit unions have made more than a million contacts through the Don't Tax My Credit Union message, Cheney said. CUNA hopes credit unions can make at least two million contacts through the campaign.
 
"CUNA and the leagues have the led this fight, and I believe we're going to win it, but only if we continue to battle," he said.

Mich. Maxwell, Herring, Desjardins Award Recipients Selected

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LANSING, Mich. (10/16/13)--The Michigan Credit Union League & Affiliates has named the state-level winners of the Dora Maxwell Social Responsibility, Louise Herring Philosophy in Action and Alphonse Desjardins Financial Education awards (Michigan Monitor Oct. 14).
 
The Dora Maxwell Award winners by asset size are:
  • $20 million to $50 million, Communicating Arts CU, Detroit;
  • $50 million to $100 million, North Central Area CU, Houghton Lake;
  • $100 million to $200 million, Oakland County CU, Waterford;
  • $200 million to $500 million, Alpena Alcona Area CU, Alpena; and
  • $1 billion plus, Lake Trust CU, Brighton.
The Louise Herring Philosophy-in-Action Award winners are:
  • $50 million to $250 million, Public Service CU, Romulus;
  • $250 million to $1 billion, Michigan First CU, Lathrop Village; and
  • $1 billion plus, Michigan Schools and Government CU, Clinton Township.
The Alphonse Desjardins Award winners in the youth financial education category are:
  • $50 million to $150 million, Public Service CU;
  • $150 million to $500 million, CASE CU, Lansing; and
  • $500 million plus, Michigan Schools and Government CU.
The Alphonse Desjardins Award winners in the adult financial education category are:
  • $150 million to $500 million, University of Michigan CU, Ann Arbor; and
  • $500 million plus, Michigan First CU.
The winners will be honored at MCUL & Affiliates' annual convention.

Recognized for community service, service to members and non-members, and financial education, the award recipients also will compete for the same awards on the national level. National winners will be announced by the Credit Union National Association this fall, and will be invited to attend the 2014 CUNA Governmental Affairs Conference in Washington, D.C.

CU System Briefs (10/16/2013)

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  • SAGINAW, Mich. (10/16/13)--Latchie Washington-Chesney, a member of Wildfire CU's board of directors, died on Aug.23, the Michigan Credit Union League has learned (Michigan Monitor Oct. 14). Washington-Chesney had been a member of Wildfire for more than four decades, and had served on its board of directors for more than three. She worked in telecommunications for almost 40 years, before retiring eight years ago. Washington-Chesney also served on the board of directors for the Information Technologies Credit Union Association. Wildfire CU, based in Saginaw, Mich. has $686 million in assets ...
  • ANN ARBOR, Mich. (10/16/13)--The University of Michigan CU presented $342,000 to benefit the school's C.S. Mott Children's Hospital and its Von Voigtlander Women's Hospital. The gift will be used to support a bronze fossil floor art installation (see photo) in the main entrance of the children's hospital--a mother-of-pearl and shell inlay by Michele Oka Doner--and a mobile application and educational activity book designed for Mott's patients and their families. UMCU is based in Ann Arbor and has more than $500 million in assets. The University of Michigan Medical School was founded in 1850. The University of Michigan Health System opened Mott and Von Voigtlander hospitals in December 2011 (Photo provided by University of Michigan CU) ...
  • GREENSBORO, N.C. (10/16/13)--More than 1,100 of Raleigh, N.C., -based State Employees' CU members attended the cooperative's annual membership meeting on Oct 9. Members were treated to a volunteer luncheon, a guest speaker and educational sessions--including topics such as technology and financial advisory services--at the Koury Convention Center in Greensboro, N.C. SECU has $26.7 billion in assets and 1.8 million members. It serves public employees in North Carolina and is based in Raleigh. (Photo provided by State Employees' CU) ...

Best of Northwest CU Movement Receive Awards

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PORTLAND, Ore. (10/16/13)--The Northwest Credit Union Association handed out 35 awards at its annual gala last week.

The Summit Awards ceremony was held on Oct. 9, at the end of NWCUA's Amplify Convention for member credit unions in Oregon and Washington.

Top award winners included:
  • Jill Nowacki, vice president of development at Maps CU in Salem, Ore., who was named the Young Credit Union Professional of the Year for her marketing and advocacy efforts.
  • Rick Hein, CEO of Oregon State University FCU in Corvallis, Ore., who was given the Innovation and Impact award for implementing a program that matched staff political fund contributions with a gift to Credit Unions for Kids.
  • Rick Brandsma, CEO of Sound CU in Tacoma, Wash., who received the Lifetime Achievement Award, for having overseen 14 successful mergers at his credit union, which opened 21 branches and accumulated more than $1 billion in assets under his guidance.
There were also eight other state-level awards presented that automatically qualified recipients for a national competition sponsored by the Credit Union National Association. Maps CU, Salem, Ore., and Solarity CU, Yakima, Wash., received first place Desjardins youth and adult financial education awards, respectively.

Court Dismisses Church Suit Vs. NCUA Over Croatian CU Claims

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CLEVELAND, Ohio (10/16/13)--A federal judge in Cleveland has dismissed a lawsuit brought by a church claiming it was owed deposit insurance payments on $1.5 million it lost when the National Credit Union Administration placed St. Paul Croatian FCU into conservatorship in 2010.

The church, Holy Love Ministries of North Ridgeville, had two accounts totaling $1.7 million in the East Lake, Ohio-based credit union when it was placed into involuntary liquidation on April 20, 2010.

The two accounts, an operating account and a building account, were set up by Joseph Plavac, an officer of the church. Plavac was also a member of the credit union's board and a former CEO of St. Paul, the opinion document said. The two accounts had multiple members designated as signers on each account, and the church alleged it had structured the accounts so each individual would be entitled to $250,000.
 
Although the church collected $250,000 in claims, its suit maintained that NCUA's Asset Management and Assistance Center, which acted as liquidating agent, should provide $250,000 per signer of the accounts, or at least provide $250,000 for the second account.
 
In the memorandum opinion filed Friday in the U.S. District Court for the Northern District of Ohio, Eastern Division, Judge Donald C. Nugent wrote that "under the Administrative Procedures Act, the NCUA Board's final determination as to insurance coverage on Holy Love's accounts was supported by substantial evidence and was not arbitrary, capricious, an abuse of discretion, or contrary to law."
 
He noted that "the accounts of a corporation, partnership, or unincorporated association engaged in any independent activity are insured up to $250,000 in the aggregate" and that the account records of the insured credit union "shall be conclusive as to the existence of any relationship pursuant to which funds in the account are deposited and on which a claim for insurance coverage is founded."
 
He noted that "St. Paul's records reflect Holy Love's accounts were accounts of a corporation, partnership, or unincorporated association engaged in an independent activity.

The liquidating agent and the NCUA Board relied on the records of St. Paul at the time of liquidation in determining Holy Love's insurance coverage." Holy Love's remaining claims are beyond the scope of the court  and are "dismissed without prejudice," he wrote.
 
The credit union's CEO, Anthony Raguz, is serving a 14-year prison term for accepting bribes, kickbacks and gifts in exchange for loans.  He allegedly issued more than 1,000 fraudulent loans totaling more than $70 million to about 300 accountholders and accepted more than $1 million in bribes (News Now Nov. 27).  Nearly two dozen people have been arrested and several have received prison terms related to the frauds.

The collapse of St. Paul Croatian FCU was one of the most costly in credit union history, costing the National Credit Union Share Insurance Fund more than $170 million.

Tomorrow's ICU Day Will Connect With Social Media

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MADISON, Wis. (10/16/13)--The Credit Union National Association is urging credit unions to emphasize their International Credit Union Day celebrations tomorrow with a hashtag and share their stories on social media.
 
CUNA seeks photos videos or stories about ICU celebrations, especially those that illustrate the credit union difference. Credit Union Magazine will compile the images and stories to provide a snapshot of the credit union world on ICU Day.
 
This year's theme, "Credit Unions Unite for Good," builds on CUNA's Unite for Good campaign, which has united credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.
 
"The banking industry claims there is no difference between credit unions and banks," said Joanne Sepich, CUNA ICU Day coordinator. "Sharing our story with #ICUday is an opportunity to demonstrate our difference. October 17 is our day. Let's own it by sharing our stories with #ICUDay."
 
Among the ways credit unions can participate:
  • Twitter. Tweet using the hashtag #ICUday. Credit unions can use up to 140 characters to describe their ICU Day celebrations and include a picture. Credit unions can follow @cumagazine for updates.
  • Facebook. Credit unions can post their activities on the official ICU Day page at facebook.com/icuday.
  • E-mail. Take a picture and send it to cumagadmin@cuna.com with a brief description. Put "ICU Day" in the subject heading.
  • Credit unions also can post on CUNA's Google+ page (use the link), use Instagram, send links to their Flickr or Picasa pages, or send links to videos on YouTube or Vimeo.
Among the ways credit unions and leagues are celebrating ICU Day:
  • Shell FCU, Deer Park, Texas, has created a short YouTube video asking, "Guess what day it is?" The video features a young man walking around the credit union asking, "Guess what day it is?" Finally, to the young man's delight, a woman named Kara tells him it's International Credit Union Day. Use the link.
  • For the second year in a row, credit unions from the Houston and Galveston, Texas, chapters of the Cornerstone Credit Union League are using the campaign theme, "Banks make dollars, not sense," to celebrate ICU Day. This year's campaign includes a mix of social and traditional media. Billboards, T-shirts, Web and print ads will be used with Facebook and Twitter to drive consumers to the CreditUnionSense.com website, where they can learn more about the credit union difference and find a local credit union to join.
  • "The celebration of International Credit Union Week comes at a time when credit union growth in Maine continues to reach new milestones," said John Murphy, president of the Maine Credit Union League (Weekly Update Oct. 11). Murphy cited this year's "Unite for Good" theme as an opportunity to "underscore and reinforce the value and benefits that come when credit unions cooperate and come together."
  • NAPUS FCU, Alexandria, Va., will celebrate ICU Day with a two-week sale on signature and auto loans. It will offer 0.5% discount on standard rates on signature loans. Members and nonmembers who have financed their car at other financial institutions can call the credit union to find get lower rates.
  • On Thursday, students from Murrell Dobbins CTE High School in Philadelphia will learn real-life lessons in budgeting and the cost of living as Freedom CU, in association with the Pennsylvania Credit Union Association, presents Philadelphia's first "Reality Fair."
  • Michigan credit unions and ICU Day were featured in an Oct. 9 article in the Sterling Heights Sentry. While not every state resident is eligible to join every credit union, there is a credit union for everyone in Michigan, Mona Shand, Michigan Credit Union League public relations manager, told the paper.  Peoples Trust CU, Southfield, and Cornerstone Community Financial CU, Auburn Hills, were also featured in the article.
  • Credit Unions United for a Cause--credit unions in Indiana's Delaware County--will celebrate ICU Day with a day of kindness. Ball State FCU, First County FCU, Industrial Centre FCU, and PrimeTrust FCU, all of Muncie, will send out "kindness crews" to perform random acts of kindness. The crews will buy coffee, pay for lunches, serve donuts and bag groceries (even supplying the bags) for local residents to celebrate ICU Day.
  • In Dublin, Ireland, Swords & District CU will feature a "Hands of Declaration" display, offering members a chance to trace their hands and write the reasons why they are credit union members in return for a chance to win a flat-screen TV.
ICU Day has been celebrated on the third Thursday of October since 1948. The day is recognized to reflect upon the credit union movement's history and to promote its achievements. It is a day to honor those who have dedicated their lives to the movement, recognize the hard work of those working in the credit union industry and show members their appreciation. The ultimate goal is to raise awareness about the great work that credit unions are doing around the world and give members and non-members the opportunity to get more involved.

CU Branches Closed By Shutdown Still Helping Members

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MADISON, Wis. (10/16/13)--While Congress struggles to get past the government shutdown impasse, credit unions are showing a can-do attitude--even when some credit union branches themselves are closed because of government building closures. They are still serving their members.
 
Not only has Norcross, Ga.-based Excel FCU, which serves primarily government employees, seen its members affected by the shutdown, but its branch in the Atlanta Federal Center in Atlanta has been closed by the government standstill, said the Georgia Credit Union Affiliates.
 
The credit union is offering a short-term, interest-free loan to members to make up the difference in a reduced or missed paycheck.  It can be converted to an 11-month loan with interest.
 
The campus locations of Atlanta-based CDC FCU also are closed, and members are being directed to its Northlake branch and to Internet and phone services, plus its deposit-friendly image-enabled ATMs, said GCUA.  Members whose paychecks are impacted by the shutdown will have their fee waived if they take a "skip-a-pay" option.  Those with direct deposit are also prequalified for loans equal to their last deposit.
 
Associated CU, also based in Norcross, is offering a $750 loan with deferred interest and payments for eligible members, and has identified 7,000 members who are eligible to apply for its furlough assistance.  During the first week of the shutdown, Associated CU processed $76,500 in program loans, with 50 loans processed in one day.
 
"We're committed to our members and make our decisions based on their best interests," said Chadwick Evans, assistant vice president of consumer lending at Associated CU.  "Our members count on us to have their backs, so creating an interest-free loan only made sense. This loan has alleviated a tremendous amount of stress during this uncertain time," Evans added.
 
Other Georgia credit unions offering assistance include TIC FCU in Columbus, which has an interest-free loan for federal employees; GeoVista FCU, Hinesville, which provides penalty-free withdrawals on certificates, extensions and interest-only payments on certain loans, with the possibility of interest-free notes with rollover options; and Robins FCU, Warner Robins, which provides loan extensions, skip-a-pay options and expedited approval on credit cards and lines of credit.
 
Credit unions in Maine have expanded their efforts to help furloughed members.  "Maine credit unions have a long history of stepping up to help people during difficult times, so it is great to see credit unions doing so again for members impacted by the federal shutdown," said Maine Credit Union League President John Murphy. 
 
Two examples:  In Portland,, cPort CU has about 1,200 members who are federal employees and is offering skip-a-payment options; an interest-free, three-month loan extension; a 30-day interest-free loan for the amount of a missed paycheck; and penalty-free early withdrawals on certificates. Town and Country FCU, South Portland, introduced a Furloughed Workers Relief Loan of up to $5,000 with a 12-month repayment at 2% annual percentage rate.
 
US FCU in Burnsville, Minn., is offering both aid and education to those hit by shutdown paycheck woes.  It is rolling out new programs and reminding the community of existing services.  Borrower Resources is provided by USFCU's Asset Protection Department and has tools to help members through times of financial strain. Tools include loan consolidation, loan payment relief and loan restructuring.
 
It also offers a signature loan program to get money in the member's account fast. It requires no collateral. Members can borrow small amounts at a short-term and defer the first payment for up to 90 days. USFCU also offers penalty-free share certificate withdrawals and provides free, one-to-one financial counseling through Lutheran Social Service.
 
If the shutdown persists, the credit union is directing members to its website for seminars hosted by the credit union and Lutheran Social Service. The "Surviving the Shutdown" education program is free.
 
"Our purpose is to serve the needs of the community in good times and bad," said Bill Raker, USFCU president/CEO. The credit union promises service, value and experience members can trust. "In a time of need, that philosophy is more relevant than ever."

(See related News Now story, CUNA Highlights CUs' Furlough Efforts For Federal Lawmakers.)

Matz To Amplify Attendees: Job Is To Help CUs Move Forward

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PORTLAND, Ore. (10/16/13)--The National Credit Union Administration's job is to help credit unions move forward, chairman Debbie Matz said in her keynote address at the Northwest Credit Union Association's Amplify Convention in Portland, Ore., last week.
 
The agency has taken significant steps to reduce the regulatory burden for credit unions, she said.
 
Matz, who kicked off the convention, said that she understands credit union concerns over rules and regulations. The NCUA is working hard on "getting to yes" rather than saying no "simply because we've always said no'" (Anthem Recap Oct. 11).
 
That's why the NCUA seeks to make sure that the regulations it does create are effective, minimally burdensome and have no unintended consequences, she said.
 
But she said there would never be a point when credit unions felt that a burden did not exist, and the "healthy tension" between credit unions and the agency will always exist.
 
The NCUA will continue the Regulatory Modernization Initiative she started in 2011, Matz said, to look for ways to streamline some regulations and make others more understandable and easier to follow.
 
Among the concerns she cited was interest-rate risk. She urged credit unions to develop policies to address long-term, low-interest loans on their books and rate sensitivities in their deposits. If rates go up precipitously, she said, many credit unions without a plan "will not survive."
 
Matz also cited other risks credit unions must monitor, including:
  • Third-party risks: Credit unions gain economies of scale from working with third-party vendors and credit union service organizations, but those relationships are not without risk and the NCUA is now looking at creating a CUSO registry. "Trust, but verify," Matz said.
  • Cyber-security risks: Credit unions need to perform risk assessments, establish incident response programs and build in mitigation processes to address cyber-security threats, Matz said. 
  • Off-balance-sheet risks: Executive benefits and pension plans are higher-risk, non-compliant investments and credit unions need to make sure they are not taking on more than they can afford.
Also at the convention, NWCUA President/CEO Troy Stang shared his vision for the future of Northwest credit unions during the association's annual business meeting.
 
Stang described a marketplace in which credit unions are so relevant to consumers that they have "at least a majority share" of the financial services market. He measured that market share in terms of members, assets, loans and deposits, and community impact.
 
To help create that world, Stang said, the NWCUA will focus on three areas in 2014: policy advancement through effective advocacy; public awareness of the structure, value and impact of credit unions; and collective action by credit unions to build trusted communities, control competitive costs and broaden their sphere of influence.
 
The common thread in all three areas is making sure that lawmakers, regulators and the general public understand that credit unions are not just a part of the fabric of their communities, but the heartbeat, he said.

NWCUA Elects Board, Officers

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PORTLAND, Ore. (10/16/13)--The Northwest Credit Union Association named three new members to its board of directors at its annual convention last week (Anthem Recap Oct. 11).

The members--Mina Worthington of Solarity CU, Yakima, Wash.; Brooke Van Vleet of St. Helens (Ore.) FCU; and Parker Cann of Boeing Employees CU (BECU), Tukwila, Wash.--were chosen in a meeting that also saw Debie Keesee of Spokane (Wash.) Media FCU re-elected as board chair.

  • Bob Newcomb from SELCO Community CU, Eugene, Ore., in District 1;
  • Jack Fallis from Global CU, Spokane, in District 2;
  • Tom Griffith from Pacific NW FCU, Portland, Ore., in District 5;
  • Phil Jones from Harborstone CU, Lakewood, Wash., in District 6;
  • Bert Fisher from Our Community CU, Shelton, Wash., in District 7;
  • Terry Belco from North Coast CU, Bellingham, Wash., in District 8; and
  • Shirley Cate from Providence FCU, Portland, who represents medium-sized credit unions.
Worthington, Van Vleet and Cann will represent Districts 3, 4 and large-sized credit unions respectively.

In addition to Keesee as chair, board officers include: Fallis as vice chair; Jones as treasurer; and Cates as secretary.

The election took place during the NWCUA annual Amplify Convention in Portland.

Michigan CUs Support Local Businesses In 'Cash Mobs'

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LANSING, Mich. (10/16/13)--Dozens of Michigan credit unions handed out cash at local businesses yesterday to encourage Main Street shopping and to raise awareness about the community focus of credit unions.
 
 Employees from more than 60 credit unions participated in the so-called CU Lunch Local "cash mob," surprising restaurant-goers by paying for their meals and store employees by buying them gifts. 
 
State credit unions also participated by committing to buy local supplies for their offices, and by partnering with local restaurants to offer discounts to credit union members(Michigan Monitor Oct. 14)
 
"Michigan credit unions are first and foremost rooted in their communities, and CU Lunch Local is a way for us to demonstrate that," said Michigan Credit Union League & Affiliates CEO David Adams. "Our credit unions support small businesses in so many ways, including business lending that is helping to create jobs and help move the state's economy forward. CU Lunch Local is an opportunity to show everyone just how big the credit union commitment to small business really is."
 
CU Lunch Local was started in 2012 by Michigan Business Connection, a credit union service organization  that is supported by MCUL & Affiliates and focuses on commercial lending.

Research has shown that money spent locally is more likely to circulate in the community than money spent at national and global chains, said the league.

"As a commercial lending CUSO helping Michigan credit unions make and manage loans, we see first-hand the tremendous impact our credit unions have in their communities," said MBC CEO Bill Beardsley. "CU Lunch Local helps highlight the credit union difference in a fun and meaningful way."

CU Rock Star Dick Ensweiler: Once a Coach, Always a Coach

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MADISON, Wis. (10/16/13)--Dick Ensweiler set off for college to become a basketball coach, but got sidetracked. After taking a summer job at State Central CU in Milwaukee, Wis., he was hooked on credit unions.

Credit Union Magazine is celebrating the credit union movement's rock stars--those ordinary people who manage to pull off the extraordinary--in honor of International Credit Union Day, which is Thursday.
 
This is the second of five credit union rock stars News Now will highlight this week.
 
"The treasurer/manager and I hit it off well to the extent that he promised me a position when I got out of college and the military," Ensweiler said. "I took him up on it and he created a first-ever management training program. It paid off, and 18 months later I became the treasurer/manager of the Harley Davidson CU."
 
It's almost 50 years later and, in a way, the Cornerstone Credit Union League CEO did become a coach--employing traits such as consensus-building, perseverance and adaptability in the face of difficult circumstances.
 
The most recent of the many credit union milestones he's experienced is the merger of the Texas, Oklahoma, and Arkansas credit union leagues.
 
"Leagues were facing shrinking numbers and finding it more difficult to provide full services," Ensweiler said. "We saw value in a larger organization with broader reach. It took four years to get through all the questions, answers, and considerations, but once interested parties remained at the table, it took less than a year to come to an agreement. The merger is everything we hoped it would be. We're more relevant now than before. With 650 credit unions, we have a bigger voice with potential partners, vendors, regulators, and national associations."
 
Ensweiler also came to credit unions' aid in 1974 when disintermediation caused savings rates to skyrocket from 6% to 22%. "Credit unions could not meet members' withdrawal requests and I was appointed to a task force of league presidents to find a solution," he said. "We proposed to the Credit Union National Association a new financial and support system--and created the corporate credit union network."
 
Honoring credit union rock stars is just one way credit unions and more than 196 million credit union members in 100 countries are preparing to "unite for good" with activities to celebrate the credit union difference and demonstrate the value of credit unions on ICU Day.
 
This year's theme, "Credit Unions Unite for Good," builds on the Credit Union National Association's Unite for Good campaign, which has rallied credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.

CU-turned-bank Lays Off 24, Ends Auto Loans Via Dealers

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FORT WORTH, Texas (10/15/13)--OmniAmerican Bank--which was a Fort Worth credit union until 2005--announced that it's laying off 24 workers after deciding to discontinue its indirect auto loan program.
 
The move comes as the bank attempts to implement cost-cutting measures, which include the elimination of the chief operating officer position. The bank said it was focusing resources on commercial, mortgage and retail banking and that it was taking the actions to reduce overall costs and increase efficiency, although it remains financially strong.

"Interest margin pressure and the competitive rate environment are impacting the profitability of banks across the nation," said Tim Carter, president/CEO.

OmniAmerican currently holds about $250 million in indirect auto loans--lines of credit that originate with car dealers. They make up about 30% of its total loan portfolio. The layoffs are roughly equivalent to 8% of the bank's 307 member work force (Fort Worth Star-Telegram Oct. 9).

OmniAmerican Bank used to be OmniAmerican CU, the second largest credit union in Fort Worth, until its members voted 3-to-1 to convert to a bank in July 2005 (News Now Feb. 13, 2007). In 2010, it floated its shares on NASDAQ after a $119 initial public offering, converting from a mutual savings bank to a publicly held company (News Now Jan. 22, 2010). The bank was founded as Carswell FCU in 1956 to serve Carswell Air Force Base.

The Credit Union National Association and the National Credit Union Administration maintain that converting to a bank charter won't benefit members (News Now May 9, 2012). Ultimately, the decision to convert a credit union to a bank must be made by the credit union's member owners, based on all the facts provided with complete transparency.  Use the link to access CUNA's Principles on Credit Union to Bank Conversions.

South Bay CU Wins CU Smack Down Competition

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LIBERTY LAKE, Wash. (10/15/13)--Competition among friends is always a little more fun--and fierce--with a little trash talking. Two West Coast credit unions exchanged some good-natured ribbing before sharing virtual hugs and high fives upon the completion of a recent loan competition.
 
South Bay CU, Redondo Beach, Calif., accepted the trophy and congratulated United Advantage Northwest FCU, Portland, Ore., for a successful contest that brought loan growth to both credit unions.
 
South Bay CU pulled ahead in the three-month consumer loan competition in the last weeks as United Advantage was forced to slow down while addressing liquidity concerns, said a press release
 
The CU Smack Down competition was the brainchild of South Bay CU CEO Jennifer Oliver, who suggested the contest at the CU*NorthWest Annual Leadership Conference where credit union leaders who use CU*BASE for their core processing solution learn about new solutions and collaborate. South Bay had conducted a similar competition internally, dividing the staff and pitting the teams against each other.
 
Evie Rasmussen, CEO United Advantage Northwest FCU, accepted the challenge. CU*NorthWest served as referee and posted the weekly total in net consumer loan growth--and the smack talk between the two credit unions--to its website. Employees from both credit unions sent each other barbs, cartoons and friendly taunts.
 
The final numbers were: South Bay 247 loans for $1,266,239 and United Advantage, 141 loans for $896,032. The competition began July 1 and ended Sept. 30.
 
"The smack talk had us laughing together, something we haven't been able to do since the recession," said Rasmussen. "Seeing the numbers and income increase was a huge bonus. Going into September, UA was ahead and we relished in our success only to fall behind since we were starting to exceed our liquidity threshold. Darn it! But knowing the regulator was coming in late September, we couldn't afford to push things dramatically. So we fell behind with a grin on our faces."
 
In the previous quarter, the South Bay staff divided in a loan competition that yielded almost $3 million in loans. This time the staff united to win the competition.  An early barb sent by Rasmussen became their rallying cry.  "The smack talk was the most fun of all," Oliver said.
 
The two credit unions developed a family-like relationship during the competition, Oliver said.  "We know each other now, and we laugh together," she explained. "You can just feel the credit union spirit."

CU System Briefs (10/15/2013)

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  • PEWAUKEE, Wis. (10/15/13)--The Wisconsin Credit Union League is hosting its third tweet chat today at 11 a.m. CT.  The monthly chat will be tweeting about leadership at all levels, said the league.  "We're hoping to continue to have participation from credit unions and credit union friends nationwide," said Angela Klaves, league director of marketing. "The chat is the perfect chance to gain a new perspective of leadership and share what you've learned about leadership over the years," she told News Now.  To join the conversation, follow the hashtag #WICUchat on Twitter. For more information, use the link  ...
  • VISALIA, Calif. (10/15/13)--A central California man has been arrested in relation to a holdup at a credit union amid a robbery spree in the central and southern part of the state this year (Fresno Bee Oct. 10). Dennis Adamson, 24, was arrested by police in Santa Ana on Oct. 6 as a suspect in the robberies of a gas station and another business. He allegedly told the police he committed other robberies and the Santa Ana police notified the Federal Bureau of Investigation, who notified police in Visalia, Adamson's former town of residence. There he stands accused of robbing the main branch of Tucoemas FCU in April. Adamson is also a suspect in the robberies of two Chase branches and a Wells Fargo bank. Tucoemas is based in Visalia, and has $122 million in assets ...
  • PORTLAND, Maine (10/15/13)--Trademark FCU named Joann Bisson as its new president/CEO, effective Oct. 1, according to the Maine Credit Union League (Weekly Update Oct. 11). Previously Trademark's chief operations officer, Bisson replaces the retiring Hunter King, who is bowing out after more than three decades in the credit union industry. Trademark FCU is based in Augusta, Maine, and has over $76 million in assets ...
  • PORTLAND, Maine (10/15/13)--Matt Gilman, board chair of Penobscot County FCU, Old Town, Maine, died Sept. 29, the Maine Credit Union League has learned (Weekly Update Oct. 11). A volunteer for the credit union, Gilman was a well-known and respected member of the community. Memorial contributions may be made to Cancer Care of Maine, or to the Church of Universal Fellowship in Orono, Maine. Penobscot County FCU has more than $50 million in assets ...

CUs Told Authentic Brand Sells Itself

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UNCASVILLE, Conn. (10/15/13)--Brands that stress a sales culture at the cost of delivering a unique experience might succeed in the short term, but that "authenticity gap" isn't sustainable, marketing innovator Matt Purvis told attendees at a Credit Union National Association Community Credit Union & Growth breakout session.

"Sales is the result of a long line of attitudes and
Click to view larger image Matt Purvis, a former marketing executive at Northwest Community CU in Eugene, Ore., and now a consultant, says he recognizes that a "sales" environment has been anathema to credit unions.  (CUNA Photo)
knowledge and skill and technique and communication and listening," said Purvis, who runs the consulting firm Purvis Management. "When you start to get that right, the sales become really, really easy and comfortable and authentic to your brand."

Think Nike, whose "Just Do It" campaign encouraged weekend warriors to put on their athletic gear and channel their inner Michael Jordan. Or REI, which breeds visions of scaling Mount Everest, he said. Engaging credit union staff in behaviors that further the consumer experience you seek will generate growth without needing to invoke the dreaded "sales" word.

A former marketing executive at Northwest Community CU in Eugene, Ore., Purvis said he recognizes that a "sales" environment has been anathema to credit unions. 

As session attendee Asi Carmeli, vice president of human operations for Scient FCU of Groton, Conn., voiced: "For years, that was the differentiator--that was what the "B" (bank) people do. We provide solutions, build relationships--anything but 'sales.'"

Purvis offered a case study of how credit unions can grow while remaining true to their principles from his recent project at MAPS CU in Salem, Ore., which hired him to direct a 12-week initiative to increase auto loan volume.

His key points:
  • Engage employees, don't train them. Purvis convened workshops for front-line staff and sought their impressions of the credit union's "Navigate Life. Together" motto. Then, he asked employees to generate "wacky" ideas for behavior in the branch that embodied that slogan. Staff now pour coffee for colleagues and members who are meeting, and continue discussions with members all the way to the parking lot. Then they follow up with a phone call two weeks later. "Brand is in the eye of the beholder," Purvis said. "Brand is determined by the consumer, not by you. If experience in the branch doesn't change, the whole makeover was moot."
  • Measure behavior, not sales. Every week, Purvis joined staff on a fun "Campaign Call" teleconference that always began with employees exchanging tips on how to hone their efforts. No one discussed financial progress reports until the tail end of the call, to underscore that results stem from a solid product.
The program reached its goal of $6.3 million in new auto loans in six weeks, and finished the 12-week window at $11.3 million.

"There are no shortcuts to healthy growth," Purvis said. "Ask, 'What is our sustainable, competitive advantage in our marketplace, and focus your brand around that."

CUNA's annual Community Credit Union & Growth Conference was held Oct. 8-11.

Crystal Ball Needed To See Payments' Future

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UNCASVILLE, Conn. (10/15/13)--Not even a fortune teller can forecast exactly which revolutionary new payment model might supplant "good ol' 1960s era card swipe technology," but George Hofheimer says the crystal ball will deliver the answer in a riddle:

Click to view larger image Filene Research Center's George Hofheimer tells a credit union audience that they would need a crystal ball to predict the next big thing in the payments system. (CUNA Photo)
What system's faster, more accurate, and secure, most likely adheres to the existing "payment plumbing" of liability custody, and passes muster with the five transaction touch points: Consumers, merchants, issuers, acquirers, and card associations? Whatever fits that profile is likely to pull ahead of the pack.

Clearly, the barrier to acceptance is steep, Hofheimer, chief researcher and innovator at Filene Research Institute, told Community Credit Union & Growth Conference attendees at a breakout session on the future of payments. The annual conference was held Oct. 8-11.

"In the short term, we're probably not going anywhere dramatically different anytime soon," Hofheimer said.

He asked his credit union audience to consider the hand-wringing over the 2015 liability deadlines for conversion to EuroPay, MasterCard, and Visa (EMV) chip technology. EMV doesn't even fundamentally upset the apple cart of swipe technology, which remains "absolutely dominant," and its debit and interchange fees upon which many credit unions rely.

Essentially, the new payment models "haven't taken hold because the technology we have today is good enough," Hofheimer summarized. "Consumers like it, and merchants for the most part like it, despite the fees."

That said, Hofheimer subscribes to Bill Gates' philosophy on futurism. In the Microsoft founder's words: "We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next 10."

Credit unions closely monitor developments in the payments sector but generally concede that because they pale in size compared to megabanks, they're better positioned to act as fast-followers than as first-adopters, according to Hofheimer. Two-thirds say they'll actively consider new payment providers in the next 24 months.

Investigate what systems megabanks use, since they're industry leaders, advised Hofheimer, and don't base your decision on consumer polls.

"Consumers are extremely fickle," Hofheimer said. "When you look at consumer data on how they want to pay in the future, what they say and do are two very different things. And generally, the answer to which system they prefer is, 'I really don't care. I just want to buy stuff.'"

With a long-range view in mind, Hofheimer suggested a few strategies for credit unions:
  • Capitalize on physical assets. Consumers aren't comfortable with managing their financial lives in the way they're comfortable bypassing other old standbys like the record store or book store. They always need a safety valve, and that's credit unions.
  • Leverage payments data. Take stock of the information you have in hand, make sense of it, and use it to deepen relationships with customers and merchants.
  • Focus on commerce. Go beyond payments and attempt to develop partnerships in your community. Explain to the local gas station owner (using data you've mined from your credit union) that your members spend $3 million a year there, and ask to forge a relationship.
  • Experiment with small bets. Invest in a start-up or fledgling payments technology firm with an amount of money that won't break you.
  • Collaborate with other credit unions and with vendors. This could be a coalescing moment for credit unions. They might be too small to solve the situation individually but could band together to find a solution--similar to how banks forged together on Visa to advance past the cash-and-check era. "In the worst case scenario--if interchange went away--wouldn't you wish collaboration would've happened 10 years earlier?" Hofheimer asked.

Benefits Of CUs Getting Boost From Media

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WASHINGTON (10/15/13)--The Credit Union National Association and the credit union system saw a busy week last week in the media. Mainstream press not only focused on credit unions' efforts to assist furloughed federal employees, but also carried general articles touting the benefits of credit unions.
 
CUNA was cited in The Wall Street Journal as an expert on consumer credit card behavior, and in a Tennessean opinion-editorial about preserving the credit union tax status. The Fontana Herald News picked up CUNA Chairman Patricia Wesenberg's op-ed on "Tax Reform Should Put Consumers First--Not Banks."
 
MoneyTalkNews carried a syndicated article by Stacy Johnson outlining seven reasons to join a  credit union. The article has had wide coverage, including in MSN.Money and Yahoo! Finance. Her reasons for joining a credit union include:
  • Lower rates on loans;
  • Higher rates on savings;
  • Better credit card deals
  • Lower and fewer fees;
  • Ease of borrowing;
  • Convenience via shared branches,
  • Human beings answering the phone; and
  • Deposits guaranteed by a federal insurance fund.
To join a credit union, she advises going to locator sites such as "the Credit Union National site."
 
And an article on Credit Unions Online noted that Biz2Credit Small Business Lending Index says the national member business loan growth is up 45% for August, proving that credit unions continue to be a necessary resource for business owners.
 
Others featuring articles favorable to credit unions in their furlough coverage included The Washington Post, Buzzfeed, CBSNews, and Baltimore Sun.
 
To access the articles, go to the "In the Media" link.

Motivational Makeover Can Help CU Leaders Through Turbulence

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UNCASVILLE, Conn. (10/15/13)--Every workplace, every nation, every individual goes through turbulent times, Sarita Maybin said in an energized keynote session at the Credit Union National Association's Community Credit Union & Growth Conference in Uncasville, Conn. But, she told her credit union audience, anyone can adapt, succeed and thrive during even the uncertain times.

Think of that disembodied voice on vehicles' navigating devices that blurts out "recalculating" when you miss a turn, Maybine (shown in photo) asked her audience. Through the economic rollercoaster of the last several years, people in all industries have been forced to regularly "recalculate" as circumstances dictate they adjust on the fly.

Consider these strategies to navigate change, Maybin said:
  • Think "big picture." Keep a long-range view, confident you can surmount inevitable setbacks. Make a mark inside your credit union by defining who you are and what skills and intangibles you offer.
  • Evaluate your network. Studies show you take on the traits of your five closest friends or associates. Do you need to upgrade your circle by weeding out the whiners?
  • Humor helps. Sometimes, a person has to to laugh to keep from crying.  Are you able to see the levity in a situation? Commiserating can help a group through tough times.
  • Change the pronoun. How do you coerce cooperation? How do you pull rank when you have no rank to pull? To avoid backlash, make a subtle pronoun shift that'll produce a major change. Instead of saying, "You need to do this," try "I need you to do this."
  • Mind the three Ps to protect yourself against others' negativity. Don't take things personally--it's usually not about you. Most difficult stretches aren't permanent--remember that this, too, shall pass. And always retain your perspective--how important is this development in the big picture?

Patrick Adams: Crossing the Line To Fight the Good Fight

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MADISON, Wis. (10/15/13)--When you think of someone willing to cross a line in the sand, Patrick Adams should immediately come to mind. He's a credit union movement Rock Star, according to Credit Union Magazine.

The magazine is celebrating the credit union movement's rock stars--those ordinary people who manage to pull off the extraordinary--in honor of International Credit Union Day.
 
This is the first of five credit union rock stars News Now will be highlighting this week.
 
In 2012, Adams, the CEO of St. Louis Community CU defied a traditional boundary to begin a four-year collaboration with a bank.
 
His reason? The need to bring all the power he could muster to reach a dramatically underserved community.
 
"The problems in St. Louis are bigger than any rivalry between banks and credit unions," said Adams, noting the city has the nation's third-most underserved African-American population.
 
Eighty-five percent of the credit union's members are low-to-moderate income, and 80% are African-American.
 
"We're one of the largest CDFIs [community development financial institutions] in the city, and a bank could use us to satisfy its community reinvestment needs," he said. "When I ran into an old friend and asked what he was up to, he said he was working for Carrollton Bank. I told him that if his bank needed to use CRA [Community Reinvestment Act] dollars, our credit union was the one to go through. Shortly after that, I got a phone call."
 
It took about a year to set up the collaboration. "There were no problems at the local level, but we guess it took a while to get the [Federal Deposit Insurance Corp.] to fully understand--the approach was so novel. A big help to getting this done was the commitment of the bank's president to serving the market. He really understands the need."
 
Adams' biggest target is payday lenders. "Missouri has the second-largest concentration of payday lenders in the U.S. They flock here and prey on the disadvantaged because there's very little industry regulation."
 
The arrangement with Carrollton Bank involves $800,000 to help with operations, including financial education, marketing and branch space. "We funded a branch with them, and have 10 other offices as well," Adams said.
 
In an in-your-face show of taking the--fight to the foe, Adams placed one of the branches in a strip mall directly between two payday lenders.
 
"We wanted to go after them. I'm a credit union veteran who has taken the credit union movement's mission seriously for years. If credit unions drift away from their original mission, it's not good. So we decided to find an economically disadvantaged community and own it."
 
Honoring credit union rock stars is just one way credit unions and more than 196 million credit union members in 100 countries are preparing to "unite for good" with a variety of activities to celebrate the credit union difference and demonstrate the value of credit unions on ICU Day.
 
This year's theme, "Credit Unions Unite for Good," builds on the Credit Union National Association's Unite for Good campaign, which has united credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.

Delaware, Illinois CUs Among Latest Consolidations

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MADISON, Wis. (10/15/13)--Eleven new mergers or planned mergers of U.S. credit unions were recently announced, signaling that the trend toward consolidation continues.
 
Here are the latest mergers.
  • The members of $18 million asset Seaford (Del.) FCU met Sept. 26 to approve a merger into Del-One FCU, Dover, Del., with $305 million in assets. The challenges of a complex regulatory and compliance environment coupled with Seaford FCU's desire to expand service delivery channels and product and service offerings were the primary reasons for the merger. The effective date of the merger was Oct.1, and system conversions will be completed about Dec. 1.   
  • Southern Illinois Area CU, Swansea, Ill., will merge into Arsenal CU, Arnold, Mo., at the end of the year. Through the merger, Southern Illinois Area CU's 1,900 members will have access to more products and services and the conveniences of a larger branch network while Arsenal's 24,000 members will gain access to another branch, the credit unions said.
  • Great Lakes CU, with $632 million in assets, in North Chicago, Ill., has merged with $14 million asset Chicagoland Electrical Industry CU in Willow Springs, Ill. Chicagoland Electrical Industry CU will gain the economy of scale a larger financial institution can provide as GLCU offers a variety of financial products and services, some of which were not currently available to CEICU members (Chicago Daily Herald Oct. 8).
  • The proposed merger of $83 million asset ChevronWest CU, Bountiful, Utah, into $2.2 billion Chevron FCU, Oakland, Calif., was approved by ChevronWest members and will be finalized on Oct. 31, when ChevronWest accounts are moved onto Chevron FCU systems.
  • Members of $60 million asset United Services CU, Ashville, N.C., approved a merger with $583 million asset Self-Help CU, Durham, N.C. The credit unions described the merger as a proactive step to capitalize on their relative strengths and expand impact within Western North Carolina.
  • Genie-Watt CU, with $14 million in assets in Bismarck, N.D., and $65 million asset Railway CU, Mandan, N.D., have merged. The merger creates cost savings by eliminating expenses and creating economies of scale with more assets and members, said Paul Brucker, Railway CU president Paul Brucker.
  • Argent CU, with $191 million in assets in Chester, Va., and $10 million asset Assurance FCU, Richmond, Va., will merge, effective Feb. 1, with Argent remaining as the surviving entity. Argent's long-term strategic objective of continued growth and operating efficiency, and focus on building the cooperative nature of the credit union system through strong merger partners, were cited as reasons for the merger.
  • Church Koinonia FCU, with $2.5 million in assets, has merged with $969 million Tennessee Valley FCU, Chattanooga, Tenn. Church Koinonia FCU was started by mostly black churches to serve low- to moderate-income families specialized in helping low-to-moderate income residents get loans (Times Free Press Sept. 22). Among the reasons cited for the merger by Church Koinonia FCU were increased regulatory requirements. 
  • The National Credit Union Administration approved a merger between $849 million asset Goldenwest CU, Ogden, Utah, and $139 million USU Charter CU, Logan, Utah. The two credit unions combined will have 26 branches. USU CU branches will maintain its brand, but will acknowledge its association with Goldenwest in its signage (Standard Examiner Aug. 24).
  • Members of $3.5 million Lima (Ohio) Postal Employees FCU voted in favor of merging into TopMark FCU, also of Lima (The Delphos Herald Sept. 18). The merger, which received regulatory approval in July, became official Oct. 1. Postal Employee FCU's members will have access to more products and services, including more than 5,000 shared branching locations, 32,000 ATMs, real estate loans and more.
  • The Oklahoma State Credit Union Board and the NCUA approved the merger of $1.3 billion TTCU The Credit Union, Tulsa, Okla., with $43 million NEO FCU, Miami, Okla. (Tulsa World Sept. 7). NEO FCU's two branches will be added to TTCU 13 branches.

Payday Passes, Fed Employees Seek Help From CUs

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MADISON, Wis. (10/15/13)--Friday's payday drove home the implications of the federal government's partial shutdown for many federal employees who received half their pay. With the shutdown beginning its third week, credit unions, who already have furlough assistance plans in effect, are receiving requests for help from the furloughed workers.
 
Furloughed workers on Capitol Hill have begun contacting their credit union, Wright Patman Congressional FCU. The $768 million asset credit union has received several calls from people in tears about their finances, its staff told buzzfeed.com (Oct.10).
 
The Washington, D.C.-based credit union offers a relief loan program at 0% annual percentage rate (APR) for 90 days. After that, the rate increases to 4% APR and is automatically extended to 36 payments. It also offers personal loans, lines-of-credit limit increases, payment deferment on existing loans, quick delivery of credit and debit cards and checks, and financial coaching. It requires a copy of the furlough notice or proof of employment at the impacted employer. The furloughed employee's salary and credit score determine what the loan amount will be.
 
M-O FCU, a $25 million asset credit union  in Huron, S.D., launched a "We Stand Ready..." campaign geared toward the federal and postal employees it serves, according to the Credit Union Association of the Dakotas (The Memo Oct. 10).  It took out newspaper ads and sent e-mail blasts to members, posted information on its website, hung posters in its lobby, and handed out flyers in money envelopes.  Many members responded positively, said CUAD. 
 
"We have had a few federal employees call in to discuss their options, and tell us how relieved they are that we are willing to help them out during this time of need," said Tiffanie Gebhart, M-O FCU's marketing coordinator.
 
Census Bureau employees  have asked $64 million, Washington, D.C.-based Census FCU about its Skip-a-Payment program. The credit union told the Washington Post (Oct. 11) that its staff have been working a few hours at the nearly deserted headquarters to meet the demand for assistance.
 
About a dozen furloughed federal employees have applied for the special Furlough Relief Loan offered by $29 million asset Miami (Fla.) FCU, President Athan "Buster" Castiglia told the Miami Herald (Oct. 9).  One woman earning about $55,000 annually told him she does not have enough reserves to go very long without pay. She's one of the mass of people in the U.S. who are living one paycheck away from the street, he said. "All you need is something like this."  The credit union's loan allows a worker to borrow up to $3,000 interest-free for 60 days. After two months, a 12% interest rate kicks in. However, Castiglia noted the loan is designed for workers to pay off the balance when the furlough ends and reimburses workers for lost pay.
 
Arsenal CU in Arnold, Mo., which serves a large number of National Geospatial Intelligence Agency members who have been furloughed, is offering unsecured loans at 0% for 12 months and hardship deferments, which allow members to skip a payment without penalty, said the Missouri Credit Union Association (Missouri Difference Oct. 9).
 
"As a not-for-profit cooperative, accommodating financial hardships affecting large segments of our membership is one of our core beliefs," said Linda Allen, Arsenal president/CEO, told MCUA.  "Allowing members to defer a payment or receive a short-term loan allows them to stay on a sound financial course during a temporary bump in the road. It's one less thing they have to worry about."
 
Desert Valleys CU,  a more than $23 million asset credit union in Ridgecrest, Calif., initiated "Shutdown" loans up to 100% of an employee's net paycheck amount, with options for a 60-day repayment period at 0%  interest.
 
"The mission of a credit union is to provide cooperative help and assistance to their community, and we see no better way to demonstrate this than helping these families while our country's leaders sort out political differences," said Eric Bruen, CEO of Desert Valleys.

CUs Continue Community Outreach Efforts

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MADISON, Wis. (10/15/13)--As credit unions continue service efforts for their communities, many will pause Thursday and Unite for Good--to show the world the value of credit unions and what the credit union difference does.
 
Credit unions do big things--witness their response to the government shutdown--on behalf of their members and communities. Some are life changing--like offering a scholarship or finding creative ways to help people take the steps to make their lives better. Others such as painting or repairing an individual's house, sprucing up the community garden or planting trees are smaller events but still meaningful.
 
Thursday is International Credit Union Day, traditionally the third Thursday of October since 1948.  Many credit unions will share good news stories to heighten awareness about credit unions. Here are a few.
 
Five Miami Valley, Ohio, families will compete to win the $10,000 grand prize in Fairborn, Ohio-based Wright-Patt CU's Savings Race 6--Health and Financial Fitness Edition, which kicked off at Kettering Health Network's (KHN) Indu & Raj Soin Medical Center Wednesday with a one-mile walk to demonstrate the importance of physical activity. WPCU has teamed with KHN, Dayton Children's Hospital, Horan Insurance and the Ronald McDonald House Charities of the Miami Valley for this special edition. (Photo provided by Wright-Patt CU)
Five Miami Valley, Ohio, families will compete to win the $10,000 grand prize in Fairborn, Ohio-based Wright-Patt CU's Savings Race 6--Health and Financial Fitness Edition, which kicked off at Kettering Health Network's (KHN) Indu & Raj Soin Medical Center Wednesday. The event aims to get the entire community involved.
 
WPCU teamed with KHN, Dayton Children's Hospital, Horan Insurance and the Ronald McDonald House Charities of the Miami Valley for this year's race. Five families--The Adamses of Fairborn, the Haneys of Beavercreek, the Henry-Joneses of Centerville, The Priests of New Carlisle and The Rodriguezes of Xenia--will compete during the next eight months as they learn how to become healthier both financially and physically.
 
The organizations will provide health advisers and subject matter experts including doctors, dietitians and outreach specialists for each family's team. WPCU and the other organizations  also provide direction and resources to encourage children and families to pursue healthy lifestyles as part of the race.
 
Wright-Patt CU noted that the community can benefit from the competition by:
  • Accessing resources, reading team blogs and voting for their favorite team at SavingsRace.com;
  • Attending free community "Healthy Hot Topic" workshops;
  • Completing a Saving Race Mini Race checklist; and
  • Tuning into family updates through WDTN's Channel 2 News on Tuesdays and Saturdays.
In Minnesota, two credit union groups have been active--with scholarships and fundraisers. Last month the Family Involvement Council (FIC) announced its 2013-2014 scholarship program for Minnesota credit union members continuing their education. The FIC will award $10,000 in college scholarships next spring--two $1,000 scholarships and 16 $500 scholarships will go to 18 members throughout the state.  Applicants will be asked to write an essay that answers the question:  "The average age of credit union members in Minnesota is 47 years old. To be sustainable, credit unions need to serve younger generations, as well. What can credit unions do to attract and engage young adult consumers?"
 
Also, Minnesota Credit Unions for Kids hosted its 18th annual golf tournament fundraiser to support Gillette Children's Specialty Healthcare, helping kids with disabilities. The tournament's 105 golfers, representing 14 credit unions and 18 vendor organizations, raised more than $35,000, including $10,000 from CO-OP Financial Services' Miracle Match program.
 
This week, in Moline, Ill., IH Mississippi Valley CU will celebrate the credit union difference, with a "guerilla" marketing campaign:  employees will hand out 1,000 Visa gift cards valued at $10 each to members.  Employees are tasked with "catching" members using their debit and credit cards at everyday places like the grocery store and gas station--anywhere except a branch.  "Now our employees will be 'catching' members using an IHMVCU credit or debit card and saying thank you for being a member," said Dennis Hall, president/CEO.
 
The Northwest Credit Union Association's Boardwalk of Miracles--a silent auction held during its annual Amplify Convention last week--raised more than $130,000 for Children's Miracle Network Hospitals. "The money you raised tonight will stay right here in the Northwest," said NWCUA President/ CEO Troy Stang. "It will help to fund research. It will build ICU wings for preemies. It will help to hire the most brilliant minds in medicine, who are dedicated to saving children's lives."
 
Watch for more coverage about International Credit Union Day and the good credit unions are spreading throughout the week in News Now.

Texas Trust CU's Youth Council Designs ICU Day Campaign

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MANSFIELD, Texas (10/11/13)--A panel of high school students that works with a Mansfield, Texas credit union developed a website to promote International Credit Union Day.
 
The Texas Trust CU Youth Advisory Council, made up of 16 high school students, meets twice a month to discuss student leadership and personal finance. (Photo provided by Texas Trust CU)
The 16-member Youth Advisory Council--established by Texas Trust CU in 2011--developed the website as part of a youth-focused International Credit Union Day campaign.

The website was designed by Jacob Brunson, Angel Murphy, and Alessandra Wheeler--three members of the group, which is made up of students at five north Texas public school districts and two private schools.

The council, which was founded to promote student leadership and personal finance, meets twice a month. Fifty-six students applied for the council's positions, which the incumbents will retain until December.
 
International Credit Union Day has been held on the third Thursday of October since 1948 to celebrate the difference between credit unions and banks.

Use the link to take a look at the website designed by the Texas Trust CU's Youth Advisory Council.

CU System Briefs (10/11/2013)

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  • SALT LAKE CITY, Utah (10/11/13)--A credit union foundation awarded schools in Utah with over $10,000 at the start of the school year. Six schools in five districts received the money from the 100% For Kids Utah Credit Union Education Foundation, a charitable arm of the Utah Credit Union Association. The donation is geared toward financing supplies for the schools' core curriculum. "Reading, writing and math are so important in our modern society and our economy, we make those projects a priority," said Liz White, director of the foundation. "In the true spirit of the original credit union philosophy, Utah's credit unions are giving back to the people in their communities through 100% for Kids," said Scott Simpson, the association's president/CEO. The foundation has given over $5 million since it was created in 2002 ...

No Monday Edition Of News Now

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WASHINGTON and MADISON, Wis. (10/14/13)--Today is Columbus Day, a federal holiday. News Now will not publish its regular issue today, but will resume regular publication on Tuesday. 

The Credit Union National Association's offices in Washington, D.C., and Madison, Wis., are open.

Oregon CU: Don't Write Off the Underserved

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UNCASVILLE, Conn. (10/11/13)--For those credit unions that have been led to believe the path to prosperity lies in focusing only on members with spotless credit, Teri Robinson has a message for you: Don't believe the hype.

In engineering a stunning turnaround of Pacific Ironworkers FCU, the CEO of the $10.6 million asset institution in Portland, Ore., placed her faith in a variety of tools designed to serve underserved consumers and those with marginal credit histories.

She said she was rewarded mightily.

Robinson told a Community Credit Union & Growth Conference breakout session about strengthening credit unions' ability to serve the underserved.

Hit hard by the recession, Pacific Ironworkers Federal fell into the net worth restoration program, bottoming out at 4.8% in January 2010. Examiners focused on four areas, according to Robinson: risky borrowers, higher-than-peer loan yield, higher-than-peer income, and higher-than-peer operating expenses.

Her curiosity piqued, Robinson analyzed her books and made a surprising discovery: Pacific Ironworkers Federal attributed 80% of charge-offs in 2011--and 60% the following year--to members with A+ to B ratings.

"I wasn't losing it on the riskier members-- I was losing it on the members who could chase rates," she said.

Pacific Ironworkers Federal's most loyal members constituted that at-risk segment, Robinson said. She decided to earn back their business from predatory lenders, who were charging members an average annual percentage rate (APR) of 29% compared to 16% for the credit union's average D-rated borrower; some even qualified for a C rating and an 8.75% APR loan.

By mining credit reports, Pacific Ironworkers Federal identified loan conversion candidates. Again, she said the results might be surprising: Robinson cited a school teacher who makes $70,000 annually as a regular payday loan user.

"I figured, if they've been making that payment at 36% for 12 months, why not get that loan over here by me?" Robinson said.

In April 2011, Pacific Ironworkers Federal obtained a Community Development Financial Institution designation, creating regulatory flexibility. An infusion of secondary capital boosted the credit union's net worth from 6.61% in January 2012 to 8.2% as of August 2013. Pacific Ironworkers Federal's loan growth increased 35% in 2013, hitting $10.5 million.

This year, Pacific Ironworkers Federal granted 47% of its loans to C-, D-, and E-rated borrowers, had a loan yield of 8% and increased its portfolio by $5.7 million. It boasts a 1% delinquency rate, and a 101% loan-to-share ratio.

"Some of the theories we think about at the National Federation of Community Development Credit Unions,  it's the people like her on the ground that prove it can happen," says Blake Myers, a federation consultant. "She's created a fair product that also works out very well for the credit union."

CU Award Winners Provide Shining Examples

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UNCASVILLE, Conn. (10/11/13)--Four credit unions received Credit Union National Association Community Credit Union of the Year Awards Thursday, recognizing community credit unions that best exemplify the principles of the credit union movement while serving as a positive influence in the field of service.

The credit unions received their honors during a ceremony at CUNA's Community Credit Union & Growth Conference in Uncasville, Conn. The three-day conference ends today.

Winners among credit unions with more than $250 million in assets were:
  • First place: Freedom First CU, Salem, Va.; and
  • Honorable mention: BayPort CU, Newport News, Va.
Winners among credit unions with less than $250 million in assets were:
  • First place: St. Louis (Mo.) Community CU; and
  • Honorable mention: Dakotaland CU, Huron, S.D.
The awards program is open to community chartered credit unions and those with multiple select employee groups. This includes credit unions that, in all aspects, consistently excell in the advancement of the ideals of the credit union movement, are proactive in their communities, and provide a wide array of services that meet the needs of their diverse communities.

Judges praised this year's entries for their:
  • Long-range commitment to developing sustainable initiatives benefiting low- and medium-income members, urban and rural;
  • Innovative campaigns that publicize the credit union difference to the masses;
  • Use of available tools such as Community Development Financial Institution (CDFI) and Low-Income Credit Union (LICU) designations; and
  • Commitment to being community action organizations.

Donovan: 'Table Is Set' For Tax Reform

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UNCASVILLE, Conn. (10/11/13)--Credit unions' membership numbers give them a tremendous advantage over their political opponents, aka the banks, said Credit Union National Association Senior Vice President Ryan Donovan Thursday, but only if federal lawmakers believe credit unions can bring their members to speak up on their behalf.

"Lawmakers take notice when they hear credit union
Click to view larger image Credit Union National Association's Ryan Donovan says now is the time for credit unions to ask their members to contact federal lawmakers in support of the credit union tax status. (CUNA Photo)
 numbers--but they take ACTION when they hear from them," he said.  Donovan was addressing the CUNA Community Credit Union & Growth Conference here.  The conference ends today.

Donovan told the assemblage of community credit union leaders that there are advocacy lessons for credit unions woven through the success of Prohibition Era politics.

First, as Donovan has advised credit unions many times, political advocacy is a "long game."  Like prohibition workers, advocates have to be disciplined, have to work methodically to generate "support on the ground," and have to be in it for the long haul--though hopefully, Donovan added, not the 60 years it took Prohibition to be established.

Another thing to remember, Donovan said, is that a group asking for change--like the banks  asking to revoke the credit union tax status or the prohibitionists seeking to revoke alcohol--is always more passionate and more motivated than the one defending the status quo.

"Credit unions are the status quo" in the credit union tax status fight, he said. "If we don't react when there is a threat, they may demonstrate the resolve to wear us down.  And that would be bad for credit union members."

The CUNA senior vice president, noting the meltdown in Congress that has caused the ongoing government shut down, said he could anticipate that credit unions might wonder, given lawmakers' seeming inability to get anything done, why bother fighting so hard on tax reform?

He informed the audience that Congress' current 95% disapproval rating is "unsustainable."

"When we are out of this crisis, there will be immense pressure on lawmakers to show that they can get something done," and tax reform could be that something, he said. The tax reform process has been a bi-partisan effort, he reminded, and added that "table is being set for Congress to do something."

"The problems that led us to the fiscal cliff and to this debt ceiling problem have not gone away. We have a debt in excess of $14 trillion and the government has been running annual budget deficits since 2001," Donovan said.  It is quite possible that the resolution for the debt ceiling will include instructions for the tax-writing committees to produce comprehensive reform and perhaps expedited consideration, he added.

Donovan said the tax reform process could still take some time, but how the credit union tax status is accommodated in the early drafts of legislation will be critically important.

Regarding bank attacks, Donovan reminded that the banks have pushed tax legislation in Oregon and Illinois and run campaigns of anti-credit union radio ads in Missouri, Illinois, and Washington, D.C., among other things.

In an on-the-spot poll, Donovan canvassed his audience asking how many thought the tax threat to credit unions was real.  Ninety-one percent indicated they understood it is real.

He urged the credit union representatives to engage their members in the advocacy efforts and noted the advocacy tools CUNA provides through its "Don't tax My Credit Union" campaign at donttaxmycreditunion.org, including mobile advocacy apps that allow instant access to lawmakers and regular updates on the tax issue.

Community CUs Offer Peers 'Best Practices' Tips

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UNCASVILLE, Conn. (10/11/13)--Three 2012 Community Credit Union of the Year award winners walked their peers through a presentation Thursday to illustrate the "best practices" that led their credit unions to the winners' circle.

The three speakers agreed that the best practice for any credit union is to stay true to the credit union philosophy. But each also dug down into the particulars that have helped their credit unions succeed. The presentation was a Thursday morning breakout session at the Credit Union National Association's annual Community Credit Union & Growth Conference.

Dan Cumbee, president/CEO of $235 million asset Dakotaland FCU, Huron, S.D., said his credit union's success is written in its history. It became a designated low-income credit union (LICU) in 1997, gained a community charter in 1998, and, because of its LICU status, has had access to secondary capital since 1999 and a waiver from the 12.25% member business lending (MBL) cap since 2005.

Cumbee said that access to secondary capital is a "great tool to manage growth." Federal law restricts most credit unions' capital formation to retained earnings. CUNA actively advocates for supplemental sources of capital for credit unions as a tool to manage growth. Among the steps to success recommended by Cumbee were:
  • Remove limitations on your credit union as much as possible. For instance, expand your field of membership. "Otherwise," he said, "you are just limiting your own future."
  • Become LICU-designated, if you can. He said there is no "downside" to the designation, and it is a route to escape capital restrictions and the MBL ceiling. 
  • Consider Federal Home Loan Banks for term borrowing. Dakotaland has been an FHLB borrower for at least 10 years, and Cumbee recommended it as a tool for mortgage lenders to lengthen their liabilities to match their assets."
Cumbee said most of all a credit union should remember its mission: service to members.

Also during the Best Practices session, Amber Scott said that in 2007 her credit union took a look at its mission statement--something she said no one really understood--and honed it. The mission the credit union accepted was to "exceed member expectations." Scott is vice president of marketing at 1st MidAmerica CU, in Bethalto, Ill.,, which won honorable mention in the $250 million-$500 million asset category in the Community Credit Union awards.

She said that 1st MidAmerica then employed member and employee feedback to determine what are the strengths contained within the credit union brand. It found:
  • Long-term relationships;
  • Service and trust; and
  • Community.
"Next we identified gaps in our brand," Scott said. They were:
  • New youth products;
  • A mortgage program for those approaching retirement years; and
  • E-service development.
Scott said her credit union met these challenges and more. MidAmerica also offers popular educational seminars to members and nonmembers in its community, among many other community outreach efforts.

MBLs were among the topics of the session's final speaker, CEO Steve Schmitz of First Community CU, Jamestown, N.D., the largest credit union in the state with $450 million in assets.

Schmitz said from 60% to 65% of his credit union's loan portfolio is in MBLs--possible because of flexibility in its 1939 charter that was grandfathered in.

"MBLs are very profitable, but expensive if you have losses. So invest wisely in expertise," he said. He also said a credit union entering or expanding an MBL program must prepare and execute a plan ("NCUA will demand it," he reminded) and be proactive in loan management.

Schmitz said his credit union's sales culture is built on a "needs-based model."

"We ask our employees to see what members need and then to ask them for their business," he said. He also counseled his credit union peers to "hire the right people" for sales, manage them well, and track results.

"Also," he admonished credit unions, "embrace change. It is the only sustainable model."

Two Leagues Report Results From Hill Hikes

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MADISON, Wis. (10/11/13)--
Click to view larger image Missouri credit unions met with U.S. Rep. Jason Smith (R-Mo.) during their Hill hikes. From left are: Dave Osborn, Anheuser-Busch Employees CU, St. Louis; Johnny O'Hare, Mid Missouri CU, Fort Leonard Wood; Don Cohenour, Missouri Credit Union Association president; Charlie Hicks, Poplar Bluff (Mo.) FCU; Rep. Smith; Sharron Payne and Kirk Mondy of Poplar Bluff FCU; Charlie Waalkes, Anheuser-Busch Employees CU; and Amy McLard, MCUA. (Photo provided by the Missouri Credit Union Association)
On the home front, several leagues this week were busy debriefing their membership on how the latest round of Hike the Hill visits went.

Ten leagues visited the Capitol last week during the Don't Tax My Credit Union campaign's online rally to deliver that message to Congress. Two of the leagues--Missouri and Michigan-- provided updates for members on their progress.

The Missouri Credit Union Association worked with the Kansas Credit Union Association to collaborate on their hikes on Oct. 2-3, said MCUA. Missouri's credit union advocates, in their visits with lawmakers, discussed preserving the credit union tax status as well as lifting the cap on credit unions' member business lending, regulatory reform, and housing finance reform and encouraged legislators to co-sponsor legislation (Missouri Difference Oct. 8).

Click to view larger image U. S. Rep. Bill Huizenga (R-Mich.), second from left, talks about credit union issuers with Hike the Hill participants from Michigan. (Photo provided by the Michigan Credit Union League)
"We focused attention on our key issues and could immediately counter information provided to lawmakers by bankers from Missouri who were also in town for legislative visits," said Amy McLard, senior vice president of advocacy for MCUA. "The timing of the Hike the Hill was extremely effective."

The delegation met with these lawmakers and staff:  U.S. Sen. Roy Blunt (R); U.S. Reps. Lacy Clay (D); Emanuel Cleaver (D), Sam Graves (R), Blaine Luetkemeyer (R), Jason Smith (R); and legislative staff Alexis Alber with Rep. Vicky Hartzler's (R) office; Brian O'Shea, with Rep. Ann Wagner's (R) office; and Curtis Trendt of Rep. Billy Long's (R) office.

More than two dozen credit union leaders from Michigan visited their state's congressional delegation.  The visitors included a few who had either never attended one of the Michigan Credit Union League's advocacy trips or had not attended in several years (Michigan Monitor Oct. 7).
 
"All the congressional staff and lawmakers we talked to understood our issues and were engaged in the conversation," said Michigan Credit Union League CEO David Adams. " It's obvious they have heard the credit union message loud and clear."   He noted the government shutdown didn't have much impact on the visit.

CUANY Economic Forum Focused On Outlook, Trends

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ALBANY, N.Y. (10/11/13)--The Credit Union Association of New York's 2013 Economic Forum, held Oct. Tuesday and Wednesday explored current trends and offered a perspective on future economic trends.
 
The Credit Union Association of New York's 2013 Economic Forum this week in Albany provided an overview of current and future economic trends. From left, speaker Dr. Barry Asmus; James Mathews, Balance Sheet Solutions senior analyst; Victor Vrigian, Alloya Corporate FCU vice president of marketing; and William Mellin, CUANY president/CEO. (Photo provided by Credit Union Association of New York)
Following a brief welcome from CUANY President/CEO William J. Mellin, the forum kicked off with a presentation from John Lass, CUNA Mutual Group's senior vice president of strategy and business development.
 
Lass highlighted emerging threats posed by non-traditional financial institutions and new payment technologies expected to make an impact in the coming years. He also encouraged credit unions to look for growth opportunities by focusing on member needs, instead of on specific products or services.
 
Following Lass' presentation, attendees chose among concurrent breakout sessions led by industry experts on economic outlooks, asset/liability management trends and loan portfolio risk management strategies.
 
The second morning began with a presentation by Dr. Barry Asmus, a senior economist with the National Center for Policy Analysis. Asmus offered a positive outlook on the U.S. economy and focused on the resurgence of American manufacturing and production, said CUANY.
 
The forum concluded with a lighthearted presentation from keynote speaker Steve Gilliland. A credit union board member, bestselling author and Speaker Hall of Fame inductee, Gilliland encouraged the group to rediscover their passion and "enjoy the ride." Lead sponsors of the forum included CUNA Mutual Group, CO-OP Financial Services and CU Direct.

Kansas CUs Give Away 23K In Make a Difference Campaign

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WICHITA, Kan. (10/11/13)--Seventeen Kansas credit unions gave away cash, gift cards and free gas totaling 23,000 to 900 Kansans at 10 locations Wednesday as part of a statewide Make Difference event.
 
Click to view larger image Adrianne Basham, Central Star CU, Wichita, receives a hug after giving away a gift card at the Kansas credit unions' 2013 Make a Difference Event.
"We don't do any advance promotion for these events," said Susan Dyer, Kansas Credit Union Association communications director. "We feel our efforts have the greatest impact when it's unexpected. We just want to brighten someone's day, and hope that those on the receiving end pass it on, so it has a ripple effect in the community."
 
This is the third event in the Kansas Credit Union Association's Make a Difference campaign. The first event was a gas giveaway.  The second event was a giveaway that included gift cards, cash, free coffee or free lunches.
 
Representatives from the participating credit unions throughout the state volunteer and coordinate their respective locations for the event. Initial consumer reactions have been positive with lots of smiles, "thank yous," and even a few hugs.
 
"These events are a great way for credit unions to put the 'people helping people' philosophy in action," said Dyer. "Credit unions exist to serve their members and support their local communities, and these events illustrate the credit union difference."
 
The giveaway did indeed make a difference to beneficiaries. Dyer reported "countless thumbs up, handshakes and high fives," and at least three hugs at one location. Some recipients cried, she said.
 
Click to view larger image A consumer in Wichita, Kan., can't believe his luck after Christy Bales of Cessna Employees CU gives him $25. (Photos provided by Kansas Credit Union Association)
At one location, a man initially took the money but returned it and asked that it be given to some more in need.
 
One credit union received a call from nonmember to thank the credit union for helping her daughter, who was down to her last $5 until payday, said Dyer.
 
The Make a Difference campaign prompted on giveaway recipient to visit the credit union and open a share account.
 
The 17 participating credit unions in the Make a Difference giveaway included:
  • Ark Valley CU, Arkansas City;
  • Central Star CU, Wichita;
  • Cessna Employees CU, Wichita
  • Educational CU, Topeka;
  • Emporia (Kan.) State FCU;
  • EquiShare CU, Wichita;
  • Kansas State University FCU, Manhattan;
  • Mainstreet CU, Lenexa;
  • Medical Community CU, Wichita;
  • Meritrust CU, Wichita;
  • Mid American CU, Wichita;
  • New Century CU, Topeka;
  • Quest CU, Topeka;
  • Reliance CU, Kansas City;
  • TECU CU, Wichita;
  • United Northwest FCU, Norton; and
  • United CU, Ness City.

Missouri CUs Were Front And Center On Virtual Rally

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ST. LOUIS, Mo. (10/11/13)--
Click to view larger image Members at Arsenal CU, Arnold, Mo.--who were among thousands who participated in delivering the Don't Tax My Credit Union message to Congress during the national online rally Oct. 2-- hold up signs that say "I am a credit union member. Don't Tax My Credit Union. #DontTaxMyCU." To view an entire album members delivering that message, use the resource link.
Credit unions in Missouri did their part to share the "Don't Tax My Credit Union" message with lawmakers during Credit Union National Association's first  national virtual rally on Oct. 2, according the Missouri Credit Union Association.

The online event featured participation from leagues, credit unions and members across the U.S. drew 9,000 unique visitors to CUNA's www.DontTaxMyCreditUnion.org site, with 70% coming from first-time visitors. The online rally saw more than 2,300 e-mails from credit union advocates and nearly 2,200 tweets using the #DontTaxMyCU hashtag sent to members of Congress. The campaign overall has sent more than one million Don't Tax messages to Congress.

MCUA's website, like those of other leagues, outlined how it and Missouri credit unions participated in the rally.
Click to view larger image While credit unions and members delivered the Don't Tax My Credit Union message via Twitter, Facebook and other social media, some credit unions delivered it in person to members of Congress at the U.S. Capitol in Washington. Here is a group of Missouri credit unions and Missouri Credit Union Association staff who participated in the Missouri-Kansas Hike the Hill Oct. 2. (Photos provided by the Missouri Credit Union Association)
The site features a video of the physical rally held at Credit Union House in Washington D.C., and the online activities of a number of credit unions in its state, including:
  • Arsenal CU, Arnold;
  • Community America CU, Kansas City;
  • Holy Rosary CU, Kansas City;
  • United CU, Mexico;
  • Electro Savings CU, St. Louis;
  • Mazuma CU, Kansas City;
  • St. Louis Community CU;
  • Vantage CU, Bridgeton;
  • BluCurrent CU, Springfield; and
  • United Consumers CU, Independence.
MCUA also provided links to Twitter and Facebook pages the credit unions and members used as well as examples of messages tweeted. Use the links to review the activities of each credit union.

MWCUA Honors Outstanding CUs, Individuals

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DENVER, Colo. (10/10/13)--The Mountain West Credit Union Association honored employees and member credit unions last month who helped raise about $30,000 to benefit the league's charitable arm, the Mountain West Credit Union Foundation.
 
Fred Kent, former president/CEO of First CU, Tempe, Ariz.; Jeremy Gibson of Trona Valley Community FCU, Green River, Wyo.;  Desert Schools FCU, Phoenix; and Denver (Colo.) Community CU were all honored at a fundraiser on Sept. 27 at Mile High Station in Denver.
 
John Uchida, president/CEO of Aurora, Colo.-based Space Age FCU and chair of the MWCUF, termed the Star Gala "a great success."

"Credit union leaders came together to honor and celebrate the foundation that credit unions stand on, 'people helping people,'" he said.

Money raised at the event--attended by more than 220 credit union employees and volunteers from Arizona, Colorado and Wyoming--states served by the MWCUA--will support leadership and community development.

Photos from the Star Gala and YouTube videos about Desert Schools FCU and Denver Community CU can be viewed by using the links.

CU System Briefs (10/10/2013)

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  • SAN ANTONIO, Texas (10/10/13)--The loan portfolio of Security Service FCU has surpassed the $7 billion mark. Three-quarters of the loan portfolio is in indirect lending. The San Antonio-based credit union is the largest provider of car loans and the fifth largest mortgage lender in the city. "We are humbled by our members' continued loyalty and trust in Security Service over the years," said Jim Laffoon, SSFCU president. "Without it, we would have never reached this milestone." Established in 1956, SSFCU has $7.4 billion in assets and over 70 locations in Texas, Colorado, and Utah ...
  • TALLAHASSEE, Fla. (10/10/13)--First Commerce CU has given $10,525 to the Foundation for Leon County Schools--a gift that will be matched by a state grant of $7,525. Teachers have until Oct. 22 to apply for mini-grants from the funds, which, since 1986, have helped fund special projects for students, many of them low-performing. Amon Rwito, a teacher who was awarded grant funding last year, used part of a donation to finance a field trip to Challenger Learning Center, classroom visits by Florida State University laboratory scientists, and materials from the Boston Museum of Science for 120 second and fifth graders. "Since serving on the board of The Foundation for Leon County Schools, I have been especially impressed and inspired by the Teacher Mini-Grant Program," said Mary Estes, FCCU senior vice president/chief operating officer. "Our teachers are treasured assets in our community, and these grants provide funding to help them take their passion and creativity to the next level in the classroom."  The announcement was made at Kate Sullivan Elementary School. Pictured are a mini-grant recipient and students , with First Commerce mascot, Sammy Squirrel. (Photo provided by First Commerce CU). FCCU, based in Tallahassee, has over 40,000 members and eight branches, including one in Thomasville, Ga. ...
 

Over 2,000 Participate In Online Discovery Conference

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MADISON, Wis. (10/10/13)--The Online Discovery Conference held by CUNA Mutual Group on Oct. 1 was virtually attended by 2,185 people, with over 50 registrants from 10 countries other than the U.S.

The conference, which seeks to help credit unions manage compliance risk, is still available online, with registration granting users access to conference materials free until June 27, 2014.

"If you missed the live event, it's not too late to participate," said Christy LaMasney, Online Discovery Conference manager. "You can still access the conference on demand, for free, by simply registering." Use the link.

The conference also awarded one conference participant--Dallas Pitts of FAA FCU based in Tupelo, Miss.--with a free registration to the 2014 America's Credit Union Conference in San Francisco and $1,000 for travel expenses.

CUNA Mutual Group provides insurance, retirement and investment products to credit unions and their members.

California FIs Warned About Illegal Payday Lenders

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SACRAMENTO, Calif. (10/10/13)--California credit unions and banks are on alert to stop illegal unlicensed online payday lenders and to identify and report any suspicious activity.
 
Jan Lynn Owen, commissioner of the California Department of Business Oversight, directed financial institutions licensed by the department to monitor transactions with any unlicensed lender and immediately report potential violations, in an Oct. 7 letter.
 
"Protecting consumers from illegal online payday lending is a central focus of the department's enforcement efforts," said Owen. "With the recent consolidation of the state's payday lending regulator with the banking and credit union regulator into the Department of Business Oversight, we are now better equipped to protect both borrowers and financial services businesses. We are reaching out to our licensees and stakeholders to try and combat this growing threat to consumers."
 
The department said it will examine credit unions to ensure safeguards are in place to prevent unlicensed payday lenders from gaining access to the automated clearinghouse (ACH) network.
 
Names of unlicensed lenders that have been the subject of multiple consumer complaints are cited on the Department of Business Oversight website.

With Gen Y, Even Fin Lit Must Be Tailored To Tastes

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UNCASVILLE, Conn. (10/10/13)--A targeted and proactive approach by credit unions to help young consumers learn to better manage their money can help cultivate these Generation Y Americans into lifelong members. But those financial literacy efforts have to be tailored to the younger generation's terms.
 
That was the message of Jim Merrill, senior vice president of sales and business development for LendKey, a CUNA Strategic Services provider.  He addressed an afternoon session at the Credit Union National Association's three-day Community Credit Union & Growth Conference here.
 
"As credit unions and as an industry, we do need to make sure we are relevant to this Generation Y demographic," Merrill stressed during his presentation. "They have the ability to save and grow credit unions in the future. The generation is huge."
 
Merrill told his audience to consider the numbers: There are 80 million individuals accounted for under the Gen Y label.  The last big population boom--the Baby Boomers--was just 76 million.  As the aging Boomers move into retirement and out of the borrowing phases of their lives, the Gen Yers can more than take their place, Merrill said.
 
But the country's young generation has different expectations than consumers of their parents' generations.  They expect their financial services--even financial literacy help--to be available 24/7, to be visually driven and interactive, personalized and targeted and easy to find in an Internet search.
 
"And there must be some form of instant gratification--they must walk away with an immediate positive impression." Otherwise, a credit union's best efforts are a waste of resources because one-third of  Millennials make a decision within five seconds to leave a site if they are not immediately engaged, Merrill warned.
 
He also said financial literacy education is a "wasted investment" without social media distribution. He urged credit unions to get to know, and get comfortable with, the "new channels" of information distribution, such as Facebook, tumblr, Twitter, Instagram, Pinterest, Reddit and more. 
 
He also informed his audience that phones are overtaking PCs in information distribution.  There was 81% growth in smartphone use in 2012 and 95 million consumers will shop in 2013 using a tablet, he reported.
 
"Ninety percent of us have our mobile device within an arms length of us 24 hours a day."

Walter Laskos Named CU Magazine Editor-in chief

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MADISON, Wis. (10/10/13)--Walter J. "Walt" Laskos will be the next editor-in-chief of Credit Union Magazine, effective Oct. 28, the Credit Union National Association announced Wednesday.
 
A well-known figure in the credit union system with a passion for promoting the good work of credit unions, Laskos will play a key role in continuing to elevate Credit Union Magazine as the premier source of information for credit unions, CUNA said.
 
"We are thrilled to have Walt as editor of the magazine," said Paul Gentile, CUNA executive vice-president of strategic communications and engagement. "I'm confident that his passion will reinvigorate our team as they continue to make Credit Union Magazine the go-to source for credit union news. We are thankful to our longtime editor Steve Rodgers, whose impressive work has set a foundation that leaves us well-positioned for the magazine's next stage."
 
Most recently, Laskos headed up the Laskos Group, which focused on member and employee communications for credit unions. He provided communications support for The Defense Credit Union Council and the National Federation of Community Development Credit Unions.
 
Prior to that, he spent 10 years as public relations director for Western Corporate FCU or WesCorp, where he served as spokesperson and established a succession of substantial public relations programs. They included "Operation Best Wishes," which provided free Webcast sessions to the military and their families during the holiday season, and a Web-TV program marketing International Credit Union Day, designed to foster awareness of credit unions and the impact of their work throughout the world.
 
Rodgers, the current editor-in-chief, will provide transitional support over the coming months for the magazine and continued support for CUNA's eScan. He has been with CUNA's publications for 33 years.

Keynoter Smith Says Storytelling Is Strong Business

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UNCASVILLE, Conn. (10/10/13)--Story telling is growing as a tool for business leaders, and credit unions can tell their stories to define their cooperative culture, inspire staff and--a big one--grow their business, according to Paul Smith, director of consumer and communications research at Procter & Gamble, who delivered Wednesday's keynote address at the Community Credit Union & Growth Conference.
 
Storytelling has been around since the dawn of man for a reason: It's contagious, demographic-proof, memorable, and inspirational. And credit unions, Smith said, have great stories to tell--from the birth of the movement to everyday experiences that change people's lives.
 
Click to view larger image Paul Smith of Proctor & Gamble says story telling can be a significant tool for business development. (CUNA Photo)
But don't confuse a recitation of facts with a story, advised Smith, author of "Lead With a Story: A Guide to Drafting Business Narratives that Captivate, Convince, and Inspire." A good story requires an emotional hook--something too many organizations are hardwired to downplay or ignore, he said.
 
"Emotional things happen around us all the time, but we intentionally exclude them from our thought process because we somehow think it's unprofessional," Smith says.
 
He invited his community credit union audience to consider this lost opportunity by Pizza Hut, a tale he relates in his book.
 
One day, a woman ordered a meatball sandwich from a young employee at the Pizza Hut in Springdale, Ark. When informed the restaurant didn't offer that item, the woman became distraught. She explained that her husband had lost his appetite due to illness, and only a meatball sandwich appealed to him. But no other restaurants offered them, and Pizza Hut was her last chance.
 
The employee realized he had the ingredients to construct a makeshift meatball sandwich, and she agreed to pay $3 for it. The next day, she called the store to personally thank the employee for going out of his way. She explained that he wasn't just sick; he had advanced lung cancer. He savored every bite of what became his last meal, as he died overnight.
 
"The real travesty behind that story is this: That happened almost 30 years ago, and the first time the story was written down was last year, when my book was published," Smith says. "That's an unforgivable sin in the business world. Can you imagine all the good that story would've done Pizza Hut internally as a display of excellent customer service, or externally as a market campaign?
 
"Why wasn't it used?" Smith asked rhetorically. "Because no one saw value in it. It was just a story."
 
Conversely, in the 1980s, Procter & Gamble conducted field studies on why some families continued to bypass Crisco for lard. One woman told a researcher that lard was a healthier choice, which perplexed him, because he knew otherwise. Why? he asked. Because buying Crisco meant she wouldn't have enough money to also buy milk, the woman replied.
 
"That hit him in the chest," Smith explained. "This was a personal decision a single mom had to make because of the high price of his product."
 
To his credit, the researcher didn't just recite facts--"Respondent says Crisco's too expensive"--but rather jotted down the entire story, which resonated within the company.
 
Likewise, founders of the credit union movement aren't just names--they have stories worth telling, says Smith. Friedrich Wilhelm Raffeisen noticed from an early age that bankers either ignored rural areas in Germany or practiced loan sharking at residents' expense, and became a cooperative pioneer. Alphonse Dejardins stumbled into a story that shocked him while working as a journalist in Canada, when a judge ruled that a man had to pay $5,000 on a $150 loan he'd taken out with a bank a year earlier. He co-founded the first North American credit union in 1900; 200 credit unions operated at the time of his death, 20 years later.
 
"This is the noble history of the business that you're in, and you should be incredibly proud," Smith said. "I'm convinced there are stories like these all over this room. Find them. Share them. People want to do business with people who have a purpose to what they're doing, beyond profit."

CUNA's Community Credit Union & Growth conference concludes on Friday.

Indiana League Awards Announced

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INDIANAPOLIS (10/10/13)--
Click to view larger image Ronald H. Mazur, left, CEO, of Chiphone FCU, Elkhart, Ind., was inducted into the Indiana Credit Union Hall of Fame during the league's statewide convention. League Chairman Frank Gulley, right, of Afena FCU, Marion, Ind., presents Mazur with the honor.
Click to view larger image Chris Wardrip, left, CEO of Financial Health FCU in Indianapolis, receives the Professional Achievement Award from Indiana Credit Union League Chairman Frank Gulley, chairman of the board, Afena FCU, Marion, Ind.
The Indiana Credit Union League presented its annual awards Sept. 27 during its statewide convention.
 
Ronald H. Mazur, CEO of Chiphone FCU, Elkhart, was inducted into the Indiana Credit Union Hall of Fame. Mazur was on the league board of directors from 2006 to 2012 and is a past league chairman. He has been a member of several league committees, and served as chairman of the Convention Committee.
 
Chris Wardrip, CEO of Financial Health FCU in Indianapolis, was the 2013 recipient of the league's Professional Achievement Award. Individuals are nominated for their professional accomplishments, their commitment to the credit union movement and their contributions to their credit union and community.
 
With Wardrip's leadership, Financial Health FCU has reached out to lower-income individuals, and has developed products and services to serve the specific needs of this group. He is active in community dvelopment efforts and has helped establish an Individual Development Account (IDA) program and participated in Bank on Indy, Indy's Campaign for Financial Fitness and other financial education and underserved programs.
 
John Dierdorf, chairman of the board of FORUM CU, Fishers, received the Leadership Achievement Award. Dierdorf has been on FORUM CU's board since 1989 and has been chairman since 1994. During his tenure, FORUM CU became: the first credit union to offer mortgage services to its members, the first credit union in the state to offer auto financing at a dealership, and the second credit union in the country to offer Internet banking. It also created a credit union service organization that offers software solutions to other credit unions.
 
Three credit union executives received 2013 Emerging Leadership Awards, which recognize the next generation of credit union leaders in Indiana:
  • Tara Holloway, assistant vice president of marketing, Teachers CU, South Bend, has represented Teachers CU on the executive leadership team of the American Heart Association Indianapolis Heart Walk. She is an alumni of ignite--a league initiative to provide a forum for new idea exchange and implementation, collaboration and networking for Indiana's credit union leaders and emerging leaders. Holloway is also a member of the league's Emerging Leadership Advisory Group.
  • Sven Leander, director of operations at Financial Center CU, Indianapolis, is a certified compliance officer. He is a member of ignite also.
  • Deidre Davis, chief marketing officer, of Notre Dame (Ind.) FCU, is also involved in the league's ignite initiative. Her team developed a vehicle repossession website. Davis is also a member of the Credit Union National Association's Marketing and Business Development Council.
    Click to view larger image Indiana Credit Union League Chairman Frank Gulley, right, chairman of Afena FCU, Marion, Ind., presents the Leadership Achievement Award to John Dierdorf, chairman of FORUM CU, Fishers, Ind. (Photos provided by Indiana Credit Union League)

Students Tell CUAD New Ideas Conference: What We Need From CUs

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DEADWOOD, S.D. (10/10/13)--A panel of four business students advised regional credit unions on interacting with younger customers in Deadwood, S.D., yesterday.

Click to view larger image A business student panel tells Credit Union Association of the Dakotas' member credit unions to help financially illiterate students and stress the credit union community development mantra during CUAD's New Ideas Conference in  Deadwood, S.D.  (Photo provided by the Credit Union Association of the Dakotas)
The panel--part of the New Ideas Conference for member credit unions of the Credit Union Association of the Dakotas--urged the audience to educate young people, rather than market to them.
 
With financial illiteracy rates inversely proportional to age, the quartet--three finance majors and a human resources and management major--said credit unions can stand out by being forthright with information, and remaining accessible and friendly to consumers with little knowledge of the financial sector.
 
The panel stressed that while students perceive credit unions as being more personal than big banks, they don't often see the two institutions as being significantly different, due to the fact that they offer similar services.

But while panel members emphasized that credit unions prioritizing honest business practices over marketing would win over younger customers, they also noted that social media outreach, online services and mobile banking are still important to their fellow students.

CU 'Good Guy' Status Provides Market Advantage: Gentile Tells Community CU

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UNCASVILLE, Conn. (10/10/13)
Click to view larger imagePaul Gentile, the Credit Union National Association's executive vice president of strategic communications and engagement, tells a community credit union audience that young Americans are attracted to the credit unions' values-based business model. (CUNA Photo)
--Credit unions have a unique opportunity today, Paul Gentile told an audience of community credit union representatives here Wednesday, to attract new members--and particularly and importantly new, young members--because they are values-based financial services providers.

"There's all this bad news circulating--the government shutdown, the debt ceiling, all the other things you're reading about," Gentile said at the CUNA Community Credit Union & Growth Conference, being held here through Friday.

"But credit unions are a bright spot in the country.  More people want to do business with businesses that do good.  They want to buy 'green' and shop local," he said.  Credit unions must recognize this environment as an opportunity to show they are the "good guys," the values-based financial services providers of the marketplace, Gentile encouraged.

Gentile is the Credit Union National Association's executive vice president of strategic communications and engagement.

"Big banks are our biggest promoters, by doing bad things--like adopting anti-consumer policies, getting government bailouts," but it up to credit unions alone, to seize the opportunities, he said.

Mirroring a theme introduced by the conference's keynote speaker, Paul Smith of Proctor & Gamble, who talked about the value of storytelling as a business tool (see related News Now story, Keynoter Smith: Storytelling Is Strong Business Tool), Gentile said it helps both membership growth and credit union political advocacy efforts when credit unions get out and tell their stories.  He said the stories should show the shared cooperative values of:
  • Being member-owned;
  • Being collaborative--credit unions help each other;
  • Being member-centric--it's all about what is good for the member; and
  • Being dedicated to consumers' financial well-being.
Gentile urged his credit union audience to share their stories within their communities, with their lawmakers, and with CUNA's Unite for Good website at uniteforgood.org.  At the 2013 Governmental Affairs Conference last March, CUNA and the state credit union leagues launched the Unite for Good campaign toward the strategic vision where "Americans choose credit unions as their best financial partner."

He said that while getting the good stories out will enhance the credit union reputation, meeting the Unite for Good goal of becoming the primary financial institution of 55 million Americans by 2023, up from the current 45.3 million, will also require finely tuned financial services.

He said to meet the Unite for Good goal of "fostering service excellence," credit unions must identify what their members most want.  And for the 80 million young people that comprise Generation Y that means, in part, moving toward phone-based access to mobile banking systems.

Kansas CUs Beat National Averages In Loan, Share Growth

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WICHITA, Kan. (10/9/13)--Credit unions in Kansas outperformed financial institutions around the nation in the second quarter, according to the Kansas Credit Union Association. Loan and share growth at credit unions in the state grew at 6.78% and 5.3% respectively throughout the quarter. National loan and share growth rates at the same time were at 5.43% and 4.7%.

"Consumer support for Kansas credit unions is strong and growing," said Tammy Wendland, vice president of products and services at KCUA. "With loans and shares growing, it's evident that Kansas consumers are looking to credit unions for lower fees and better rates."

Net interest margin, at 3.18% in Kansas credit unions, also bested the 2.7% national average.

Average delinquency at Kansas credit unions reached a record low of 0.80%, and credit card delinquencies reached a 15-year minimum.

Product penetration, a measurement that reflects how many members are using credit unions' products, was also on the rise in Kansas, alongside member growth. On June 30, KCUA tallied 630,000 credit union members in the state.

Credit unions with less than $20 million in assets saw loans increase by 42.49%, shares grow by 18.63%, and membership grow by 39.21%.

Their counterparts with between $20 million and $100 million saw loans increase by 38.83%, shares grow by 15.75%, and membership increase by 8.92%.

Credit unions with over $100 million in assets saw loans increase by 15.82%, shares grow by 19.19%, and membership increase by 11.18%.

The growth reflects a relatively strong economy in Kansas. The U.S. Bureau of Labor Statistics measured seasonally adjusted unemployment in Kansas to be at 5.8% in June, and at 7.6% nationwide.

Bankrate Checking Survey: Fees At Record High

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MADISON, Wis. (10/9/13)--Checking fees at banks are at a record high, according to Bankrate's 2013 Checking Survey, further evidence that credit unions, with their emphasis on lower fees, remain the smarter choice for fee-conscious consumers.
 
ATM fees, overdraft fees and monthly maintenance fees were also at record highs, according to the survey. But after years of steep declines, the share of checking accounts considered free may be stabilizing, said Bankrate.
 
Between 2009 and 2012, free checking declined to 39% of checking accounts from 76%. This year, 38% of checking accounts offered by major banks are free, down 1 percentage point from last year's study.
 
The percentage of banks offering free checking also dropped in the first half of the year, according to the MoneyRates.com Bank Fees Survey (News Now Aug. 20). Less than 30.31% of banks surveyed had no monthly maintenance fee--the lowest percentage since 2009. That figure is a drop from 36.6% recorded at the end of 2012.  In 2011, roughly 34.7% reported charging no fees--the lowest percentage until now.
 
Those who do pay monthly fees are paying more than ever, according to Bankrate's survey. The average fee on a checking account rose from $5.48 to $5.54 per month.
 
ATM fees also hit an all-time high said Bankrate. Banks now charge noncustomers an average of $2.60 to use their ATMs, up from $2.50 last year.
 
There's another way to avoid fees, said Karin Bonding, a lecturer in personal finance at the University of Virginia's McIntire School of Commerce. Shop around.
 
"You don't have to go to a bank, there are other options," Bonding said. Instead, she suggested checking out a credit union or online financial services provider.
 
According to Bankrate.com's  2013 Credit Union Checking Survey, released in March, 72% of America's 50 largest credit unions offer free checking (News Now March 21).

CUNA, CU Member Take On Bankers On Tax Status

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WASHINGTON and DULUTH, Minn. (10/9/13)--The Credit Union National Association took on the bankers in an article in the Tennesseean about bankers' attacks on the credit union tax status, and a credit union member chimed in on the tax debate in an op-ed in the Duluth News Tribune.

"Banks don't want to level the playing field; they just want to eliminate the competition completely--and they know that without the tax exemption, credit unions will not be able to compete," said Credit Union National Association Executive Vice President Paul Gentile in the Tennessean article, which was published Monday.

CUNA told the publication that credit unions provide members with lower fees, lower interest rates and higher returns on savings and taxation would end up costing consumers, rather than making a difference in federal government revenues.

The statements were made in an article about the priorities of the next president of the Tennessee Banking Association, Colin Barrett, who named taxing credit unions and simplifying regulatory burdens prompted by the financial crisis of 2008.

Barrett said that "a lot of our banks are finding themselves in a situation where they have more compliance officers than they do lenders because it takes so much to keep up with everything coming out of Washington." He predicted, "it's going to make it more difficult for consumers to get mortgage loans and it's not going to provide any benefit."

Credit unions' tax status is also a running debate through a number of letters to the editor and op-ed pieces. The latest, on Monday, is an op-ed from credit union member Bryce Makela of Duluth--who outlined why credit unions deserve their tax exemption.

"I have accounts in both credit unions and banks," Makela said, noting that the only advantage he had found with banks was wider accessibility with ATMs.

"Credit unions are owned by those they serve; banks are owned by their stockholders. Credit unions return their profits (after expenses and salaries are paid) back to their members; banks, as corporations, are created to make as much profit as possible for their stockholders," he wrote.

CU System Briefs (10/09/2013)

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  • FERNDALE, Mich. (10/9/13)--A credit union in Michigan announced the winners of a July contest designed to promote its social media via Pinterest and its 75th anniversary (Michigan Monitor Oct 7.) Ferndale-based Credit Union ONE announced that Stacy Davis and Janna Smith won the contest, which asked members to share photos of great relationships in their lives on the photograph sharing platform Pinterest. Davis and Smith each won a trip to Mackinac Island, on Lake Huron. Credit Union ONE also awarded two runners-up with $100 gift cards, and another four contestants with $75 gift cards. "The exposure to this new social media platform is what we were going for, so we are pleased with how it turned out," said Andrea Pertile, the credit union's social media marketing manager. Credit Union ONE promoted the contest with emails, in-branch marketing and on Facebook. Members posted 429 photos, and 58 individuals followed them. The credit union also asked members to post a photo caption detailing what 75 years meant to them. Credit Union ONE has $810.2 million in assets ...
  • FARMERS BRANCH, Texas (10/9/13)--Generations FCU, a San Antonio, Texas-based institution, was named one of the city's healthiest employers by the San Antonio Business Journal (The Leaguer Oct 8). The 73-year old credit union with $419 million in assets received the honor for company policies that promote the health of employees, including a walking challenge with a 65% participation rate, and health food cooking contests. Generations FCU will be honored alongside other winners--including Security Service FCU, another San Antonio-based institution--at a group fitness walk and a subsequent awards breakfast on Oct. 24 ...
  • MELBOURNE, Fla. (10/9/13)--Space Coast CU handed out 100 $20 gas gift cards to motorists, in a promotion at a Deltona, Fla. gas station Friday afternoon. "October marks SCCU's 20th year serving Volusia and Flagler counties, and we wanted to give back to the local community," said Kimberly Tyree, director of regional services for SCCU in the two counties. "Surprising residents with $20 to help fill up their tank is a fun way to engage and educate the community about SCCU Members Watchdog," she added, explaining the credit union's "Watchdog" philosophy that seeks to look out for members' interests. SCCU employees from the Deltona branch also gave away scratch cards for cash and incentives redeemable at Valusia and Flagler county branches of the credit union. SCCU, chartered in 1951, is based in Melbourne, Fla., and has more than $3 billion in assets ...
  • BELLEVUE, Neb. (10/9/13)--An architect who designed the corporate headquarters for SAC FCU was honored for his plan. Leo A. Daly was given a People's Choice Award for distinguished accomplishment in excellence by the American Institute of Architects Nebraska for his design. The Papillion, Neb.-based building, which is scheduled to open in the spring of 2014, will have a solid black brick base that will host public functions, including a retail branch, a community room, and a four-story atrium. Corporate offices will be situated atop the base, in a curtain wall system protruding toward an intersection. The building also features hardwood floors, and Daly is attempting to diminish the building's carbon emissions through a geothermal well system and LED lighting. SAC FCU has over $670 million in assets ...

New Jersey League Announces State Awards

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HIGHTSTOWN, N.J. (10/9/13)--The New Jersey Credit Union League presented its annual awards at its 2013 Annual Meeting & Convention, Sept. 29-Oct. 1 in Atlantic City.
 
This year's award winners include:
  • CEO of the Year--Eileen Crean, president/CEO,  Members 1st of NJ FCU, Vineland;
  • Credit Union of the Year--New Jersey Law & Public Safety CU, Trenton;
  • Calvin Jackson Memorial Volunteer of the Year--Jack Hickey, board member, Jersey Shore FCU, Northfield;
  • Difference Maker of the Year--Tom Quigley, director of marketing, Xcel FCU, Bloomfield; and
  • Miller & Kosobucki Marketing Award--Bay Atlantic FCU, Vineland, and Credit Union of New Jersey, Ewing.
The NJCUL's YouTube channel features videos of each award winner's nominator describing the honoree's accomplishments. Use the link.

CU System Briefs (10/08/2013)

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  • LATHAM, N.Y. (10/8/13)--Two Brooklyn residents were arrested Friday for allegedly defrauding local credit unions (Albany Times Union Oct. 4). New York state law enforcement officers charged Ronice J. Sahadeo, 32, with attempted grand larceny, forgery, criminal possession of a forged instrument, criminal possession of stolen property, and attempted identity theft. They also charged Antoine L. Barksdale, 25, with criminal possession of stolen property. The arrests were made after Colonie police received a tip Monday that an individual was allegedly using falsified documents to take out a $25,000 loan from Sunmark FCU in Halfmoon. Officers then investigated allegations of similar crimes at other credit unions in Colonie and Clifton Park, and identified the same woman as a suspect. On Tuesday, Sahadeo allegedly went back to the SEFCU in Halfmoon to ask about the loan, after attempting to withdraw funds from another line of credit at an SEFCU branch in Glenville--a transaction Sunmark denied as suspicious. Glenville police apprehended Sahadeo and Barksdale as they drove to the Clifton Park branch. They allegedly had in their possession money obtained from identity theft committed in New York, Alabama, and North Carolina. The pair's next court appearance is scheduled to take place on Wednesday. SEFCU is based in Latham N.Y., and has $400 million in assets ...
  • BROOKLYN, N.Y. (10/8/13)--Michael E. Fryzel, board member of the National Credit Union Administration (NCUA), was named an honorary grand marshal of the 2013 Pulkaski Day Parade on Sunday. The annual celebration, held in New York City since 1937, commemorates Kazimierz Pulaski--the Polish brigadier general and Revolutionary War hero who died fighting the British at the Battle of Savanah. Fryzel was presented a sash for the parade by Polish & Slavic FCU CEO Bogdan Chmieleski. "As a Polish-American and the first chairman and board member of Polish descent to serve on the NCUA Board, it was a great honor to be named Honorary Grand Marshall and to walk the parade with you," Fryzel said at the Brooklyn-based credit union on Monday. "The Pulaski Day Parade is just one of many activities Polish & Slavic is involved in. Their scholarship program for students is outstanding and yet another way they take part in the community they serve, truly exemplifying the credit union philosophy of people helping people." ...
  • ROYAL OAK, Mich. (10/8/13)--Michigan credit unions gave $100,000 to Children's Miracle Network (CMN) Hospitals, a nationwide alliance of hospitals for kids (Michigan Monitor Oct. 7). The donation was presented at Beaumont Children's Hospital. From left, John Kozich and Judi Desilets of Credit Union ONE, Ferndale: Ken Ross and Stephanie Klocinski of the Michigan Credit Union League; and Dan Davidson from Alliance Catholic CU, Southfield,  presented the gift to Beaumont Foundation manager Lisa Stewart and Matt Romnkey, associate director of the foundation. (Photo provided by the Michigan Credit Union League) ...
  • HUNTSVILLE, Ala. (10/8/13)--A 57-year-old Alabama man accused of a fraud scheme that involved a Tuscaloosa credit union and the U.S. Small Business Administration is facing 51 charges, a 1,000 year-sentence and up to $35 million in fines, after being indicted by a federal grand jury (Huntsville Times Oct. 6). Danny Ray Butler stands accused of forging and altering documents, and overestimating the cost of a proposal to obtain millions in loans from the SBA, West Alabama Bank and Trust and Alabama One CU, Tuscaloosa, to open a grocery store. After the store was built, Butler allegedly defaulted on the loans, costing the SBA over $1.7 million and the $161 million asset Alabama One CU almost $1.3 million. Butler is also accused of operating a check-kiting scheme, with one account tied to his grocery store, and another tied to a Tuscaloosa used-car lot he owns and operates. The alleged scheme was discovered by Alabama Bank and Trust in February 2012, after Butler allegedly wrote hundreds of fraudulent checks ...

Minnesota CUs Talk Tax Reform, MBLs, Regs With Fed Lawmakers

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WASHINGTON, D.C. (10/8/13)--Twelve Minnesota credit union advocates, including volunteers and board members, visited Washington, D.C., Oct. 1-3, for the Minnesota Credit Union Network's annual Hike the Hill event.
 
Click to view larger image During Minnesota Credit Union Network's Oct. 1-3 Hike the Hill event, credit union representatives met with U.S. Rep. Rick Nolan (D-Minn.). (Photo provided by Minnesota Credit Union Network)
"Hike the Hill is a great opportunity to meet with federal legislators and regulatory officials to advocate for our credit unions and discuss the issues they face," said Mara Humphrey, MnCUN vice president, governmental affairs. "The trip is always an important way of advocating with federal officials on behalf of credit unions."
 
The group's primary focus in meetings with Minnesota's congressional delegation was tax reform and the credit union corporate income tax exemption. Credit union representatives urged legislators to protect the tax status in any potential rewrite of the federal tax code. Minnesota credit unions provide nearly $110 million in direct financial benefits to the state's 1.5 million credit union members. That translates into saving the average member $71 a year and the average member household $135 a year.
 
Another topic discussed with legislators was raising credit unions' member business lending (MBL) cap to 27.5% of assets from 12.25%, which would enable credit unions to help more small businesses obtain loans. The Credit Union Small Business Jobs Creation Bill (H.R. 688, S. 968), which would raise the MBL cap, would allow Minnesota credit unions to lend up to $193 million in its first year of enactment, creating more than 2,000 new jobs in the state, the group told lawmakers.
 
Nationwide lifting the cap would help create 140,000 new jobs and inject $13 billion in small business loans into the economy, without costing taxpayers a dime, said the Credit Union National Association.
 
Minnesota participants also met with National Credit Union Administration Chairman Deborah Matz and Elizabeth Ellis, Consumer Financial Protection Bureau deputy assistant director for the Office of Financial Institutions and Business Liaison. Discussions focused on the challenges credit unions face with conducting operations in today's stringent regulatory environment, including those related to privacy notification requirements and credit union examinations, MnCUN.
 
The three-day Washington, D.C., trip included a legislative and regulatory briefing with the CUNA and visits at the offices of all of Minnesota's federal elected officials.

CUAid: Need $100K More For Colorado CU Members' Flood Relief

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MADISON, Wis. (10/8/13)--Colorado credit union members, volunteers and staff affected by recent flooding in that state have requested more than $200,000 in disaster relief, which means at least $100,000 still needs to be collected through CUAid.coop, the online disaster relief system.
 
CUAid.coop was activated two weeks ago by the National Credit Union Foundation (NCUF) and Mountain West Credit Union Foundation (NWCUF). Since then, they have received more than $200,000 in requests. Currently, NCUF has roughly 40% of the funds needed to meet those requests.
 
The flooding in Colorado last month destroyed nearly 2,000 homes, damaged another 16,000 homes, and hit hard nearly 1,000 businesses. Highways are just reopening with reduced volume of traffic. Floodind debris is being removed from neighborhoods and business districts, allowing some people to begin rebuilding their lives, personally and professionally. 
 
Click to view larger image Pictured is the aftermath of flooding to a credit union member's condominium kitchen in Boulder, Colo. For more photos, use the "Photos of Flood's Aftermath" resource link.
"There are numerous folks who are still waiting for the infrastructure necessary to their lives to be rebuilt adequately, allowing them to return to their properties," said Dan Santangelo, executive director of the MWCUF.

"Many people who need help are credit union members. Since our philosophy in credit unions has always been summed up by the phrase 'people helping people,' I'm respectfully, but urgently, asking you to help credit union members in Colorado as they try to move forward from this disaster," he said.
 
For example, Michelle (last name withheld by request), a 35-year member of Elevations CU in Boulder, lost her home for a second time in the floods. The first time was due to a short sale that she suffered when her income as a realtor decreased 75% during the recession. The September flooding hit her 650 square foot condominium in Boulder with a four foot wall of water, destroying walls, doors and windows, along with all of her uninsured appliances, furnishings and personal belongings.

Click to view larger image This photo shows a bedroom in a Boulder, Colo., credit union member's condominium after floods. For more photos, use the "Photos of Flood's Aftermath" link. (Photos provided by the National Credit Union Foundation)
Michelle has been denied any help from the Federal Emergency Management Agency, and she is currently living in a motor home on a friend's property. She expects to remain there for the next six to eight months, while her condo is rebuilt. 
 
"We are hearing hundreds of stories similar to Michelle's and would like to help them with a CUAid grant," noted Santangelo. "Please consider helping Colorado credit union members by making a donation to CUAid."
 
Credit union supporters in every state can make donations at www.cuaid.coop. CUAid is the only program of its kind that enables credit union employees, volunteers, and members, as well as credit unions and credit union organizations across the U.S., to contribute directly to support other credit union people.
 
As donations are posted through CUAid.coop, NCUF is coordinating with the Mountain West foundation in the disaster area to distribute money efficiently to affected credit union employees and members. One hundred percent of the donations through CUAid goes to credit union disaster relief. If all donations are not used for Colorado Flooding relief, NCUF will transfer unused funds to its "General Disaster Relief fund" for future disaster relief efforts.
 
Organizations and individuals can use a variety of CUAid Web buttons, including those specific to the Colorado Flooding campaign, for their website. Use the link.

New $100 Bill Now In Circulation

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WASHINGTON (10/8/13)--The Federal Reserve begins circulating its new $100 bill today, with security features designed to thwart forgery.

The bill has a blue three-dimensional ribbon and holographic imagery less likely to be replicated by counterfeiters than previous versions.

In April, Fed officials accurately predicted that the bill would be released today (News Now April 25).

The new note has been under development for over a decade, and its release had been delayed by the Federal Reserve for two and a half years. Four months before its originally scheduled February 2011 debut, the Fed delayed introducing the note into the money supply, blaming a printing malfunction that caused some bills to be creased and unable to be circulated. In 2012, the Treasury Department's inspector general said that printing problems could have been avoided.

The $100 bill is one of the U.S.'s largest exports. The Federal Reserve estimates that between one-half and two-thirds of the notes in circulation are abroad.

Most Common Consumer Complaint: Big Banks' Checking Accounts

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LANSING, Mich. (10/8/13)--Credit unions have another round to add to the stockpile of reasons credit unions are a better value for consumers than banks are.  Banks--especially big ones--have generated the most consumer complaints since March 2012, says a recent Public Interest Research Group in Michigan Education Fund (PIRGIM) study.
 
The non-profit group based in Lansing, Mich., analyzed 19,000 consumer complaints made to the Consumer Finance Protection Bureau's public Consumer Complaints Database. The report highlights banks that generated the most complaints through their various banking services in each state.  Checking account services bore the brunt of the complaints, said PIRGIM.
 
Some key findings:
  • The top 25 U.S. banks were targets of 90% of the complaints. Credit unions could make a case that this is a signal of consumers' frustration with their banks' policies, although the study concluded the numbers are so high because these banks have most of the customers.
  • Banks with the most complaints overall included the three largest banks in terms of dollars deposited: Wells Fargo, Bank of America and JP Morgan Chase. Wells Fargo chalked up 3,453 complaints, while BofA had 3,135, and JPMorgan Chase has 2,032 complaints. PNC Bank and U.S. Bancorp were targets of 880 and 776 complaints, respectively.
  • On a per-dollar basis--the banks with the most complaints per deposit-- TCF National Bank, Sovereign Bank and Capital One topped the list of complaints. TCF National had 24.9 complaints per billion dollars deposited, Sovereign had 9.1 complaints per billion  and Capital One had 6.5 complaints per billion.
  • On checking account issues, 78% of the problems related to opening, closing and managing the accounts.
  • One in four complaints (28%) resulted in monetary relief to a consume and an additional 5% resulted in nonmonetary relief such as adjusting account terms. About 95% of the complaints were closed through the process. That means that although banks responded to 95% of the complaints, roughly one in every five resolutions is still being disputed by the consumer.
"Thanks to the CFPB's complaints database, consumers who get misled or exploited by their banks can make their voices heard and get satisfaction," said Eric S. Mosher, program associate for the PIRGIM Education Fund. "Other consumers can view the public database and make smarter, more informed financial choices," he added, noting that  the database provides "a transparent roadmap for navigating the financial marketplace."
 
The report, "Big Banks, Big Complaints: CFPB's Consumer Complaints Database Gets Real Results for Consumers," is the first in a series that analyzes the database complaints. Upcoming reports will analyze complaints about private student loans, credit cards, credit reporting and debt collection.

H&FF Teams With Consumer Reports On Health Law Helper

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MADISON, Wis. (10/8/13)--The Credit Union National Association's Home & Family Finance Resource Center and Plan It retirement microsite now include the Consumer Reports Health Law Helper to help credit union members and employees sort through their options under the Affordable Care Act.
 
The interactive tool will be added to CUNA's MoneyMix for Young Adults microsite this week.
 
Consumer Reports approached CUNA about including the Health Law Helper as a resource for consumers.
 
"It's gratifying that Consumer Reports recognizes credit unions as a primary and trusted information provider for their member consumers," said Susan Tiffany, CUNA director of consumer periodicals.
 
The Health Law Helper is offered free by Consumer Reports a public service.
 
The tool's primary objective is to provide consumers with unbiased and simple Consumer Reports guidance so they can comply with new healthcare requirements.
 
Users enter basic information about family size, income range, citizenship status, state of resident, and source of insurance, and insurance status. They receive a personalized list of options based on their situation.
 
Users who do not have insurance, will be shown options that vary depending on age, household size, income, and the state of residence.
 
Enrollment under the Affordable Care Act opened Oct. 1.

National CU Foundation Board Opens Nominations

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MADISON, Wis. (10/8/13)--Nominations for four open National Credit Union Foundation (NCUF) board seats are due Oct. 31.
 
The nominations are for two credit union executive or director seats, a Credit Union National Association (CUNA) board representative and a corporate credit union representative.
 
Volunteers serve up to three terms of three years each on the NCUF Board as long as they are re-nominated by the NCUF Nominations Committee and re-elected by the NCUF Board.
 
Qualifications for the four NCUF board seats include:
  • Two credit union executives or directors--Each candidate must be an executive officer or director of a credit union;
  • One CUNA board representative--Each candidate must be and remain a CUNA board member and shall be designated by the CUNA board of directors;
  • One corporate credit union representative-Each candidate must be and remain a president of a corporate credit union and shall be designated by the Association of Corporate Credit Unions.
Incumbents serving in three of the four board seats open for nominations include:
  • Winona Nava, president/CEO Guadalupe CU, Santa Fe, N.M., who is completing her first term in the CUNA board representative seat;
  • Angela McCathran, president/CEO of People's Trust FCU, Houston, who is completing her first term in the credit union executive or director seat; and
  • Lee Butke, president/CEO Corporate One FCU, Columbus, Ohio, who is completing his first term in the corporate credit union representative seat.
All three incumbents have expressed interest in serving another term. The second credit union executive or director seat that will be vacant is filled by Rudy Hanley, president/CEO of SchoolsFirst FCU, Santa Ana, Calif. Hanley is not running for re-election.
 
Qualified candidates interested in applying for any of these four seats can click "Volunteer for our Board" from the NCUF homepage to obtain the NCUF Declaration of Candidacy document.
 
It is also possible that the NCUF board will be expanded in the near future and more seats will be available, said NCUF. If so, an announcement will be made with another call for nominations.

Brazil CU Execs To Intern At Arkansas, Okla., Texas CUs

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FARMERS BRANCH, Texas (10/8/13)--Credit unions in Arkansas, Texas, and Oklahoma will host middle and upper level executives from Sicredi, a 128 institution-strong Brazilian credit union trade association on Oct. 10 (Leaguer, Oct. 7).

The dozen executives from the Porto Alegre-based Sicredi will be in the three states until Nov. 1 for a "people to people" internship program. The program was first launched in 2010 through the World Council of Credit Unions and the Cornerstone Credit Union League--the state league for credit unions in Arkansas, Oklahoma, and Texas.

The program will be financed by a division of the U.S. Department of State called the Bureau of Education and Cultural Affairs.

Throughout the three weeks, the Sicredi executives will "shadow" their American counterparts to learn about governance, risk management, business continuity, member business lending, indirect lending, advocacy, savings products and services, youth outreach, retirement accounts, marketing, branch design, technology, social media and community outreach
.
"These internships are a wonderful opportunity for credit unions in the U.S. and Brazil to learn from one another; to share ideas and best practices," said league CEO Dick Ensweiler. "Sicredi is a progressive and sophisticated organization, and I am confident that the three-week internship be a mutually beneficial experience."

Last year, 11 Sicredi executives spent time with credit union executives in Texas for a similar junket (News Now Sept. 7, 2012). The partnership was first established between Sicredi and the Texas Credit Union League (TCUL) after the 1 Credit Union Conference three years ago in Las Vegas (News Now July 14, 2010).

In the Media: Furlough Assistance, Economy, CU Benefits

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MADISON, Wis. (10/8/13)--The Credit Union National Association and credit unions weighed in on furlough assistance, the economy and the benefits of credit unions in national media this week.

Furloughs were the big topic as the government shutdown entered into a second week. CUNA Chief Economist told MarketWatch's Breaking News Monday that the effects of the government shutdown are, so far, significant but localized or "micro" rather than "macro." For instance, he said, the shutdown affects 800,000 workers, but that is a few out of a 150 million-worker labor force.

"The shutdown is significant but for a few or a small number," Hampel said.  If it were to last the whole month, the economic growth--which is currently 2%--might drop to 1.9%--which would not be game-changing, he said.  However, not meeting the deadline for the federal deficit is a "completely different matter." Use the link to hear the conversation.

Credit unions are quick to offer assistance to members in times of trouble because they are " in touch with the needs of their members," said Paul Gentile, CUNA' executive vice president of strategic communications and engagement, in an article on CreditCards.com Monday  about how financial institutions are helping consumers during the government shutdown.
 
"You'll find that credit unions are much more organized and much more responsive when it comes to something like this because of their experiences with it," Gentile added. He noted many credit union members are government employees who have been furloughed before.
 
Among those cited as examples of financial institutions with policies designed to help affected federal workers were:
  • Andrews FCU, Suitland, Md., offering bridge loans of up to $5,000 to qualified members. The loans are interest-free for 90 days. After that, usual interest rates apply.
  • Hanscom FCU, Hanscom AFB, Mass., offering federal employees up to a $5,000 line of credit extended if their checking accounts become overdrawn. The credit line is interest-free for 60 days. The credit union is also waiving penalty fees for withdrawals from certificates of deposit, the article said.
See related News Now story, CUs Offering Help To Furloughed  Fed Employees, by using the link.

More stories about the shutdown and what credit unions are doing to help have appeared  in American Banker, Yahoo!Finance, Politico, Money Talks News, BBJ Today, Des Moines Register and WDRBNews.
 
Also, in the media:
  • The Daily Rundown featured cooperatives offering health insurance in 23 states;
  • Daily Finance.com noted secured cards issued by credit unions are most likely to be fee-free; and
  • Politix reminded readers that credit unions did not cause the financial crisis.
Use the "In the Media" link to access most of the stories.

CU Magazine Honors CU 'Rock Stars'

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MADISON, Wis. (10/8/13)--In honor of International Credit Union Day on Thursday, Oct. 17 Credit Union Magazine is publishing a special bonus edition dedicated to the credit union movement's rock stars--ordinary people who manage to do the extraordinary.
 
For the past several months, Credit Union Magazine's subscribers have been nominating their rock-star colleagues on its website. Visit creditunionmagazine.com/nominaterockstar to nominate a colleague for next year's edition.
 
The end result of this year's nomination process is a showcase of 48 rock stars from a broad cross-section of credit unions, leagues, and related organizations.
 
Next week, News Now will feature profiles of five rock stars selected by readers.
 
"We didn't have room for all the photos and stories about our rock stars, so check out our website for more coverage of these remarkable people," said Steve Rodgers, Credit Union Magazine's editor.
 
Honoring credit union rock stars is just one way credit unions and more 196 million credit union members in 100 countries are preparing to "unite for good" with a variety of activities to celebrate the credit union difference and demonstrate the value of credit unions on ICU Day.
 
This year's theme, "Credit Unions Unite for Good," builds on the Credit Union National Association's Unite for Good campaign, which has united credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.

CU System Briefs (10/07/2013)

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  • SANTA ROSA, Calif. (10/7/13)--Redwood CU announced that employees exceeded its annual $95,000 United Way workplace giving campaign goal for the 15th year in a row, with donations topping $96,000. The credit union said it encouraged workers to give through raffles, casual days, smoothie parties and other events. Donations support the United Way of the Wine Country and United Way of the Bay Area. RCU employees also recently volunteered their time to help maintain and clean at a Boys & Girls Club, and at facilities offering services to foster children and the homeless ...
     
  • DES MOINES, Iowa (10/7/13)--A blog hosted by credit unions payment processor The Members Group was named one of the top 20 blogs for financial marketers by The Financial Brand, an online publication covering retail banking marketing. A variety of The Members Group employees and executives contribute to the blog (TMGBlog.com), publishing posts on strategy, fraud prevention, product innovation and other industry related subjects. "Every marketer who has given blogging a try will tell you it's extremely difficult, deadline-driven work," said TMG vice president of marketing, Georgann Smith. "At the same time, the work pays off. Our clients and others in the financial institution community have come to know TMGBlog.com as a reliable resource for best practices, news and insight on the hottest topics in payments. It has been a years-long initiative for our company, and we're so honored to have the hard work of our executive-level writers and our marketing team acknowledged by such an important outlet in our industry." ...
     
  • ALBANY, N.Y. (10/7/13)--Lucy Gottung Halstead has been named First New York FCU's new president/CEO. Previously senior vice president and chief operating officer, Halstead joined First New York FCU in 1998. While at the Albany-based credit union, Halstead has supervised branch operations and the management team, while overseeing business development. She graduated from the College of Saint Rose with a bachelor of arts in public communications, and also graduated from the Stonier Graduate School of Banking. First New York FCU has $272.2 million in assets ...
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NEW: CUAid: $100K More Needed To Aid CU Members In Colorado Floods

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MADISON, Wis. (10/7/13, UPDATED 3 p.m. CT)--Credit union people in Colorado affected by recent flooding have requested more than $200,000 in disaster relief, which means at least $100,000 still needs to be collected through CUAid.coop, the online disaster relief system for credit unions.
 
CUAid.coop was activated two weeks ago by the National Credit Union Foundation (NCUF) and Mountain West Credit Union Foundation (NWCUF). Since then, they have received more than $200,000 in requests but currently NCUF has about 40% of the funds needed to meet those requests.
 

Click to view larger image Pictured is the aftermath of flooding to a credit union member's condominium kitchen in Boulder, Colo. For more photos, use the "Photos of Flood's Aftermath" resource link.

The flooding that occurred in Colorado last month was devastating for thousands of Colorado residents. It destroyed nearly 2,000 homes, damaged another 16,000 homes, and hit hard nearly 1,000 businesses. Highways are just now starting to reopen on a reduced volume basis. Debris caused by the flooding is being removed from neighborhoods and business districts, allowing some people to begin rebuilding their lives, personally and professionally. 
 
"There are numerous folks who are still waiting for the infrastructure necessary to their lives to be rebuilt adequately, allowing them to return to their properties," said Dan Santangelo, executive director of the MWCUF. "Many people who need help are credit union members. Since our philosophy in credit unions has always been summed up by the phrase 'people helping people,' I'm respectfully, but urgently, asking you to help credit union members in Colorado as they try to move forward from this disaster."
 

Click to view larger image This photo shows a bedroom in a Boulder, Colo., credit union member's condominium after floods. For more photos, use the "Photos of Flood's Aftermath" link. (Photos provided by the National Credit Union Foundation)

For example, Michelle (last name withheld by request), a 35-year member of Elevations CU in Boulder, lost her home for a second time in the floods. The first time was due to a short sale that she suffered when her income as a realtor decreased 75% during the recession. The September flooding hit her 650 square foot condominium in Boulder with a four foot wall of water, destroying walls, doors and windows, along with all of her uninsured appliances, furnishings and personal belongings.

Michelle has been denied any help from the Federal Emergency Management Agency, and she is currently living in a motor home on a friend's property. She expects to remain there for the next six to eight months, while her condo is rebuilt. 
 
"We are hearing hundreds of stories similar to Michelle's and would like to help them with a CUAid grant," noted Santangelo. "Please consider helping Colorado credit union members by making a donation to CUAid."
 
Credit union supporters in every state can make donations at www.cuaid.coop. CUAid is the only program of its kind that enables credit union employees, volunteers, and members, as well as credit unions and credit union organizations across the U.S., to contribute directly to support other credit union people.
 
As donations are posted through CUAid.coop, NCUF is coordinating with the Mountain West foundation in the disaster area to distribute money efficiently to affected credit union employees and members. One hundred percent of the donations through CUAid goes to credit union disaster relief. If all donations are not used for Colorado Flooding relief, NCUF will transfer unused funds to its "General Disaster Relief fund" for future disaster relief efforts.
 
Organizations and individuals can use a variety of CUAid Web buttons, including those specific to the Colorado Flooding campaign, for their website. Use the link.

NCUF's Kitsch Highlights CU Fin. Lit. Tools At Field Hearing

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MADISON, Wis. (10/7/13)--Lois Kitsch, National Credit Union Foundation National REAL Solutions program director, participated in a Sept. 26 Financial Literacy and Education Commission (FLEC) field hearing on youth and post-secondary financial education, organized by the Financial Literacy and Education Commission.
 
Click to view larger image Lois Kitsch, second from right, national program director for the National Credit Union Foundation, speaks about reality fairs at a Sept. 26 Financial Literacy and Education Commission field hearing on youth and post-secondary financial education. The event, held in Madison, Wis., was organized by the Consumer Financial Protection Bureau. (Photo provided by National Credit Union Foundation)
Kitsch spoke primarily on NCUF's work with reality fairs, which are interactive financial literacy tools for high school students that have proved successful for many credit unions and state leagues. Twenty-six states offer students reality fair programs--14 of which can be tied directly to REAL Solutions. An estimated 10,000 students attended a fair in 2012 and that number is expected to grow substantially in 2013.
 
"Experiential learning is powerful because many people learn best by doing," said Kitsch. "In fact, at our most recent Reality Fair at the [Credit Union National Associationa] Governmental Affairs Conference, a teacher said he thought the students learned a semester's worth of meaningful material in just two hours."
 
The commission was established under the Fair and Accurate Credit Transactions Act of 2003 and is charged with creating a national strategy on financial education. The FLEC is chaired by U.S. Secretary of Treasury Jacob Lew, Consumer Financial Protection Bureau Director Richard Cordray is the vice chairman.
 
The event, held on the University of Wisconsin campus in Madison, Wis., featured remarks from Cordray, who said financial education should be as fundamental to the education U.S. history and government News Now  
 
Kitsch was part of a panel entitled "Building Youth Financial Capability Through experiential Learning." Also participating on the panel was Jennifer Block, representing Royal CU, Eau Claire, Wis.  
 
The full video of the field hearing is available online. Use the link.

More CUs Announce Furlough Assistance

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MADISON, Wis. (10/7/13)--The federal government's shutdown entered its second week with more credit unions pledging their assistance to members--and nonmembers.
 
"We have received numerous calls from members in the past week, worried about the shutdown and asking if we can help them financially," said Robin Lentz, president/CEO of Cabrillo CU, San Diego, Calif. "Many of them are still working. They need money for gas to get to work and they still have families to feed even though they're not getting paid."
 
So far, more than three dozen credit unions have stepped up to help, but those are only credit unions that have reported to News Now or whose efforts were  part of  local news coverage in their communities. Given credit unions' cooperative not-for-profit structure, many more credit unions assisting their members through the shutdown are likely.
 
Cabrillo CU is rolling out a 0% loan to help workers and their families. The line of credit is equal to an employee's last full paycheck, up to $2,500.  Should the shutdown continue through Friday, when most of San Diego area federal employees are paid, the line of credit will appear on their account. If the shutdown lasts longer, Cabrillo CU is prepared to do it again to cover the second pay period on Oct. 25.
 
"It's part of a program we created in 2008 called PAL, short for Payroll Assurance Loan," said Toby Hayes, Cabrillo's vice president of marketing. Cabrillo activates it several times a year for certain federal employees when their payroll is not received for days at a time due to holidays or natural disasters. "It helps our members get by until they do get paid. Obviously, this shutdown could last a lot longer."
 
In addition to helping members, credit unions are leading efforts to offer advice through the media to the general public about the best way to manage finances during the furloughs.

An example: FAA CU, Oklahoma City, Okla.  CEO Steve Rasmussen offered viewers of KFOR Channel 4 advice for uncertain times (kfor.com Oct. 4). The impasse could cause interest rates to go up on credit cards, auto loans and mortgages, which means higher monthly payments, said the station. Skip-a-payments, short-term loans and building emergency cash fund were discussed.

"The one thing you don't want to do is miss a credit card payment," Rasmussen advised. "Because if you do miss those, your interest rate could accelerate. Payments would go up."
 
In addition to credit unions previously reported with programs to provide furlough assistance during the shutdown, others include:
  • Redstone FCU, Huntsville, Ala.  Redstone is offering free financial consulting from 7 a.m. to 10 p.m. Monday through Thursday, 7 a.m. to 7 p.m. Friday, and 10 a.m. to 7 p.m. Saturday. Free one-one-one financial counseling is also available through its BALANCE program.  It also offers furlough assistance loans up to $5,000 or the pre-furlough net monthly pay at a 2% fixed rate for 12 months, with no payment required for 60 days.
  • Hawaii State FCU, Honolulu. In addition to penalty-free term share withdrawals, it offers one- to three-month deferment of loan payments. Its free 30-minute financial checkups for members to improve their financial health include a review of credit, refinancing high-rate loans, lowering interest on credit cards and consolidating debt. High-yield savings and interest-bearing checking accounts, as well as a BALANCE financial fitness program, also are available (Hawaii Reporter Oct. 4).
  • Community CU, Rockledge, Fla.  The credit union offers two assistance packages--0% loans and fee waivers on early withdrawals on share certificates--to help government workers (FloridaToday.com Oct. 5).
  • Coloramo FCU, Grand Junction, Colo.  For members, it waives the $30 Skip-a-Payment fee and offers personal loans in the amount of the member's net paycheck up to three months. For nonmembers, it will waive membership, title and loan fees to help them refinance loans they may have elsewhere (krextv.com Oct. 5).
  • TIC FCU, Columbus, Ga. Roughly 2,700 people are being furloughed at Fort Benning in Georgia.  The $266 million asset credit union is offering temporary short-term loans to those with direct deposit at the credit union. "This short-term loan has been developed to help you through this troubling time," TIC told members (Columbus Ledger-Enquirer Oct. 3).
  • Federal Employees CU, Des Moines, Iowa.  The $18 million asset credit union dusted off its playbook from the 1995 federal government shutdown, which lasted 28 days. If members miss a paycheck because of a furlough, the credit union will issue a no-interest loan and provide payment waivers for current loans (Des Moines Register Oct. 4).
  • MCLG Family CU, Mason City, Iowa. The $35 million asset credit union approved a special loan Wednesday that allows federal employees to borrow up to $1,000 without collateral at 4.99% interest rate instead of the normal 13.5% rate. It also allows members to skip a scheduled monthly payment on loans (Des Moines Register Oct. 4).
In Rapid City, S.D., Minuteman Community FCU President/CEO Mary Connick told the Credit Union Association of the Dakotas that it has received positive feedback about its assistance, not only from members but from other National Guard employees (The Memo Oct. 4).  One National Guard member visited to personally thank the credit union for helping out. Another thanked the credit union for helping him and his family.

"We were ready to support our service members who are affected by the government shutdown," Connick said. "We have been serving the National Guard for over 50 years, and this is just another way to provide a service to our members who serve our country. This is a typical reaction of our credit union when adverse financial situations occur that may affect our military members," she added.

Cabrillo's Hayes sums it up:  "As a credit union we were founded by federal employees. We successfully helped members through the 1995 shutdown, and we're here to help again. It's what we do best."

U Of Kansas Study: Young Savers Better Investors Later In Life

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LAWRENCE, Kan. (10/7/13)--Recent University of Kansas reports might give a boost to credit unions that seek to encourage kids to save money (Credit Unions Online Oct. 4).

The trio of reports, published by the Assets and Education Initiative at the university's School of Social Welfare, found that kids and teenagers who take part in maintaining their own savings accounts may be more likely to save and invest money "with mainstream banks" as young adults.

One of the studies' author, Terri Friedline, said that young adults are twice as likely to have savings accounts and four times as likely to have invested in stocks if they had savings accounts as children. She also said that young adults who had savings accounts as kids accumulated an average of about $2,000--a total of about $1,900 more than their counterparts who didn't have savings accounts as kids.

The reports concluded that removing policy barriers that limit account ownership could benefit children and financial institutions.

In addition to offering accounts tailored to children, credit unions and credit union organizations have a variety of programs designed to get kids to start saving money at a young age. The Pennsylvania Credit Union Association (PCUA) recently reported the opening of the 52nd student-run in-school credit union in the state (Life Is a Highway Oct. 3), and the National Credit Union Foundation (NCUF) holds Reality Fairs, which are interactive financial literacy education gatherings.

ICU Day Nears, CUs Preparing Special Activities

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MADISON, Wis. (10/7/13)--With Oct. 17--International Credit Union Day--fast approaching, more than 196 million credit union members in 100 countries are preparing to "unite for good" with a variety of activities to celebrate the credit union difference and demonstrate the value of credit unions. Credit unions already are tweeting their excitement.

Among the tweets:
  • "@BestAdvantageCU  will be educating our members on what we stand fork...the 7 Cooperative Principles!!"
  • "We're gearing up for #icuday! Feel free to print out this coloring page for the little ones so they can color awayJ ow.ly/i/3fUCJ." The tweet, from TDECU, was accompanied by a Unite for Good coloring page.
  • "Join us Oct 17th for  #cookies and #coffee in our lobby as we celebrate International Credit Union day! " said Star Choice CU, while Pen Air FCU, noted "All Pen Air FCU branches will be serving refreshments!"
Their excitement isn't new. For 65 years, since 1948--the credit union has celebrated ICU Day by reflecting on the movement's history and promoting its achievements on the third Thursday of October.
 
This year's theme, "Credit Unions Unite for Good," builds on the Credit Union National Association's Unite for Good campaign, which has united credit unions to work to remove barriers, create awareness of the good credit unions do for members and their communities, and foster service excellence to encourage Americans to choose credit unions as their best financial partner.
 
Many credit unions are extending their celebrations for the entire week--or even the entire month.

In Kansas City, Mo., Mazuma CU has united with CommunityAmerica, United Consumers and Kansas City CUs, to host a Facebook sweepstakes. The credit unions will give away $2,000 to one of three Kansas City organizations--Junior Achievement of Middle America, Down Syndrome Guild of Kansas City, or Great Plains SPCA--as well as randomly select an individual to choose a matching $2,000 contribution to a cause of the winner's choice. Voting, which began Oct. 1, is open to the general public and will end Oct. 17.

"We wanted to do more than lip service and something that would really show the cooperative spirit of credit unions," said Mazuma brand manager Andy Dickhut. "This allows us to do it in a unique way that everyone can take part in."

Together the credit unions  have more than 8,000 Facebook friends.  "Facebook is all about connecting with a community of people who share similar interests," Dickhut said. "We're all interested in doing good, so turning to social media for this idea was a natural fit."

To vote, consumers can go to any participating credit union's official Facebook page and "like" the page, which will then direct them to the vote page. There, they select the organization they'd like to win and fill out a form to be eligible for the individual drawing.  To vote from a mobile device, voters can go to woobox.com/q7ycw6.

At the chapter level, North Carolina credit union chapters are activities throughout the month, with the Tarheel Chapter getting an early start--tomorrow--in a discussion about the political landscape for the 2014 election cycle. Attendees will also get federal and state legislative updates from North Carolina Credit Union League staff.  On Oct. 15, the Foothills Chapter featuring guests Al Henry, H&H Barber Shop and a local comedian, while the Western Chapter celebrates with wine and cheese, dinner and bingo.

On Oct. 17, the Northwest Chapter will have dinner, host B-52 Bingo and present its Person and Volunteer of the Year Awards.  The Southeast Chapter plans an auction to raise funds for the Southeast Chapter Charity and Scholarship Programs, with a dinner and raffle. And the Piedmont Chapter dinner meeting will feature magician Chris Hannibal.

The Cornerstone Credit Union League has announced a "$10.17 for 10/17" fundraiser for its credit union advocacy efforts in Texas. It plans to raise $25,000 for the Texas political action committee. The league said that if five members per credit union contributed $10.17 for Oct. 17,  it would raise the full amount.

Both CUNA and the World Council of Credit Unions have created Web pages with resources credit unions can use, including posters, logos, member gifts, marketing ideas and more. Use the links for more information. Credit unions can share their ideas by using the link.

And here are a few suggestions for celebrating:
  • Hold an open house at the credit union and branch offices, with tours and refreshments. It is an opportunity to build relationships with members and discuss products and services.
  • Invite elected officials to a "Meet the Members" day.
  • Get the word out about the worldwide credit union movement by displaying posters and offering international foods.
  • Have a "guest day" at the credit union where members can bring guests for refreshments and learn more about the credit union.
  • Help members "meet their credit union" by displaying photos and biographies of employees.

CUAD Takes NCUA on N. Dakota Oil Field Tour

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BISMARCK, N.D. (10/7/13)--The Credit Union Association of the Dakotas last week joined a delegation of credit union representatives and state and federal regulators on a tour of the oil-impacted areas in Northern and Western North Dakota.
 
Click to view larger image The Credit Union Association of the Dakotas last week hosted a delegation of credit union representatives and regulators on a tour of the oil-impacted areas in North Dakota. Among those participating, from left, were: Denton Zubke, Dakota West CU, Watford City;  Darrell Olson, president/CEO, Town & Country CU, Minot;  Robbie Thompson, CUAD president/CEO;  Bob Entringer, North Dakota Department of Financial Institutions commissioner;  C. Keith Morton, National Credit Union Administration regional director;  Amy Kleinschmit, CUAD director of compliance;  Shannon Webster, Town & Country CU senior vice president of marketing;  Buddy Gill, senior strategic communications and external relations advisor to NCUA Chairman Debbie Matz; Melanie Stillwell, CEO, Western Cooperative CU, Williston;  and Corey Krebs, North Dakota Department of Financial Institutions senior examiner. (Photo provided by Credit Union Association of Dakotas)
CUAD had requested that the National Credit Union Administration tour the area and meet with area credit unions to see firsthand the challenges facing credit unions in the rapidly growing area.
 
"It was a tremendously educational trip," CUAD President/CEO Robbie Thompson said. "I think that no one really understands what it is like in these areas until they experience it firsthand." He and league Director of Compliance Amy Kleinschmit led the tour.
 
Included in the tour group were C. Keith Morton, NCUA regional director; Buddy Gill, senior strategic communications and external relations advisor to NCUA Chairman Debbie Matz, and Bob Entringer, North Dakota Department of Financial Institutions commissioner.
 
The tour kicked off in Minot, N.D., on Oct. 1 with a meeting and panel discussion.  More than 20 North Dakota credit union professionals shared their experiences and asked questions of the panel.  Regulators heard about the challenges facing North Dakota credit unions, such as falling capital resulting from deposit growth, new member verification difficulties, and how increased regulation makes it more difficult to serve members. 
 
CUAD representatives then led the group, including North Dakota Department of Financial Institutions Senior Examiner Corey Krebs and a contingent credit union executives, to Williston, N.D., where they toured a Target Logistics Housing Facility or "man camp," that houses more than 400 oil-industry workers.
 
The group visited Stat Oil to discuss the long-term prospects of oil production in the Bakken area. North Dakota is the second-highest oil producing state in the country, and it is estimated that the Bakken oil field will produce oil for at least 30 years.
 
Rory Nelson, Western North Dakota's energy impact coordinator for the governor's office, discussed the impact of oil production on the area. He estimated that the number of permanent oil jobs in the Williston area will grow to more than 30,000 from 10,000 by 2025. 
 
Melanie Stillwell, CEO of Western Cooperative CU of Williston, and Denton Zubke, CEO of Dakota West CU, Watford City, stressed to regulators that the inability to find affordable housing and daycare makes attracting and retaining employees a huge challenge for credit unions. Also, competing with "oil field" salaries and the rising cost of training due to high turnover means that controlling expenses is becoming increasingly difficult for credit unions.

Maine CUs' Assets Break $6B, Membership At New High

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PORTLAND, Maine (10/7/13)--Credit unions' popularity with consumers in Maine is at an all-time high, according to mid-year statistics released by the Maine Credit Union League (Weekly Update Oct. 4).

"The trend of more Maine consumers turning to credit unions, not only as new members but strengthening existing relationships, is a testament to the appreciation and value of the cooperative structure of credit unions in providing financial services," commented John Murphy, league president. "The credit union brand resonates strongly with consumers."

From New Year's Day until June 30, the state's 61 credit unions recorded $6.09 billion in assets--an increase of $204 million. They also had an uptick of $115 million in loans--a 3% increase that saw outstanding loans exceed a record $4 billion. During that time, savings in Maine credit unions also grew by $205 million, an increase of 4.1% driven by the 8,000 new members who joined credit unions in the first half of 2013.

The net increase of 1.3% in membership saw total credit union membership in the state rise to 633,272. The figure represents just under half of the 1.33 million people living in Maine in 2012, according to the U.S. Census Bureau.

NWCUA Amplify Convention In Portland This Week

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PORTLAND, Ore. (10/7/13)--More than 600 credit union professionals and business solutions partners will get a front-row perspective into the federal government shutdown, beltway gridlock, industry regulation and financial services innovation at the Northwest Credit Union Association's Amplify Convention this week.
 
The convention will be gaveled into session Tuesday in Portland, Ore.
 
Headline speakers include:
  • Debbie Matz, National Credit Union Administration chair, delivering the opening keynote address;
  • A.B. Stoddard, associate editor and columnist for The Hill, delivering a closed session keynote address offering insight into the federal government shutdown and beltway politics;
  • Laura Kelly, chief product officer, Dun & Bradstreet, addressing how credit unions can tap new opportunities in the "Innovation 2.0" age;
  • Anthony Huey, president, Reputation Management Associates, helping attendees to perfect more powerful messages and stay on point; and
  • Bernard Lachance, singer and marketer, sharing how he parlayed his shoestring marketing approach into an appearance on Oprah and sold out concert halls.
Amplify Convention's program content underscores a "Market Share Matters" priority, ensuring that Northwest credit unions create trends, leverage growth opportunities and engage to amplify the credit union value proposition.

The social impact of Northwest credit unions will be celebrated at the Boardwalk of Miracles Dinner and Auction, which will raise funds for Credit Unions for Kids, the credit union movement's national "charity of choice" founded in the Northwest in 1986, and The Summit Awards program celebrating the highest achievers in advocacy, chapter excellence, community impact, innovation and lifetime achievement.
 
Coming off a successful tax battle in the Oregon Legislature and sessions that saw Credit Union Act upgrades in both Oregon and Washington, Amplify Convention also will focus on strengthening the Northwest's already well-resourced  grassroots advocacy army, said NWCUA.

More than 100 business solutions partners will showcase new and emerging technology at the Strategic Link trade show, and the Northwest Credit Union Foundation will unveil a robust strategic philanthropy vision leveraging collaboration between credit unions and community organizations with mission-aligned innovation.

Attendees will use the hashtag #CUAmplify13 during the convention.

Filene i3 Collects Nine New Ideas for CU Innovation

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MADISON, Wis. (10/7/13)--A new report from the Filene Research Institute presents "Nine of the Latest Ideas from Filene I3."

Filene's i3 fosters the development of new ideas and innovations for credit unions. Ideas developed in the i3 program since its inception in 2003 have gone on to change state laws, improve the financial lives of millions of consumers, save millions of dollars for credit unions and drive new members to the credit union system, said Filene.

New ideas presented in the report include:
  • Homease. A web application designed to ease the anxiety of home financing, Homease tracks key milestones for homebuyers during the confusing mortgage process, similar to a popular pizza tracker, helping to reduce mortgage-related call volume from members;
  • CUnited. Essentially a "dating website" for credit union leaders looking to collaborate with peers throughout the country, CUnited matches users based on an algorithm that compares expertise, interest and willingness;
  • WheelChoice. A national network that helps credit unions sell repossessed cars directly to dealers, arranges a dealer consignment relationship, and develops a short-term car sharing program for members;
  • Living Your Legacy. A Web application that provides unbiased, confidential, lifecycle-based insurance information to credit union members, providing access to qualified, helpful professionals;
  • The Credit Union Well-Being Incentive Program. A mobile app that rewards credit union members who make socially responsible choices, helping to develop a membership base that's less risky, highly aligned with the credit union's mission, and more loyal--all key components in helping generate revenues;
  • Future Forward. A mobile app that helps credit union members determine the future value of their savings if applied to retirement or existing debt;
  • MyDime. A tablet app that helps members choose loan terms on their own and reach out to the key 18-34 demographic, the peak demand group in consumer lending;
  • Interplay. The app makes the workplace fun by using gaming components that give job-related rewards and teaches skills to engage credit union employees, a first step in retaining talented workers and preventing turnover; and
  • Mobile Payments. An update to last year's i3 idea Flash Note, Mobile Payments is an agnostic form of payment that uses existing point-of-sale infrared scanning technology to help credit unions jump from traditional payment types to digital.
To download the report, use the link.

CU System Briefs (10/04/2013)

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  • MADISON, Wis. (10/4/13)--The challenges and opportunities faced by community banks are detailed in a new Wisconsin Department of Financial Institutions/Conference of State Bank Supervisors (CSBS)/Federal Reserve System report entitled "Community Banking in the 21st Century: Opportunities, Challenges and Perspective." The report was released during the first ever CSBS-Federal Reserve "Community Banking in the 21st Century" conference. The report draws its results from town hall meetings, a survey of 1,700 bankers in 28 states, and 100 Wisconsin community bankers who were interviewed during a series of roundtable meetings ...
  • RIDGELAND, Miss. (10/4/13)--A fugitive task force arrested a second suspect in the robbery of Members Exchange CU in Ridgeland, Miss. Kenyatta McGee was apprehended in Gainesville, Ga. The task force also seized an unknown amount of cash (Clarion-Ledger Oct. 1). McGee is charged with robbery, conspiracy to commit robbery and one count of kidnapping. Olivia Walker, 31, of Pearl, Miss., an employee of the credit union, was previously charged with conspiracy in connection with the robbery. Police released surveillance video that shows a man dressed in black entering the credit union, which was closed at the time. The suspect used spray paint to cover camera lenses inside the credit union, then allegedly forced two female employees into the backroom before escaping with an unknown amount of cash ...
  • ST. PAUL, Minn. (10/4/13)--General Mills FCU, based in Minnetonka, Minn., has designated the late Merlin J. Magnusson as a Credit Union Builder through the Minnesota Credit Union Foundation. He was the credit union's first general manager and worked for GMFCU from 1966 until his retirement 25 years later in 1991. Magnusson, who died on July 1, joins 22 other individuals who have been honored with MnCUF's Credit Union Builder Award during the past six years ...

DHCU Community CU Launches 'CashBack' Checking Account

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MOLINE, Ill. (10/4/13)--Instead of the usual loyalty programs, rewards and member incentives to entice members in a competitive deposit environment, DHCU Community CU, based in Moline, Ill., is taking an out-of-the-box approach to a new checking account program. It has introduced CashBack Checking, an account that pays members each time they use their debit CheckCard and Visa cards.
 
Each time members use their DHCU CheckCard or Visa credit card, they earn an introductory cashback offer of ten cents for each CheckCard transaction and 20 cents for each DHCU Visa credit card transaction. CashBack rewards will accumulate throughout the program year and be paid as a deposit into the member's CashBack checking account each November.
 
"There is no other account like this in the area," said Matt McCombs, president/chief operations officer. "Many financials insist on confusing monthly requirements, such as a minimum balance or having direct deposit, only to offer a slight return on the account.  CashBack is our way of 'paying back' our members, with no limits or fine print attached."
 
The program applies to both signature and PIN debit transactions. The $469 million asset credit union has no minimums set on the number of transactions and no cap on how much a member can earn through the program.
 
On Jan. 1, the debit card payout reverts back to the program standard of five cents per transaction, with no limits.
 
CashBack checking is not limited to CheckCard debit card usage. DHCU offers CashBack for Visa credit card transactions to members who use CashBack Checking. They will earn 20 cents on any DHCU Visa transaction during the introduction period and 10 cents per transaction afterward.  No limits are set on this program, and members can swipe their DHCU Visa as often as they want without reaching a cap on their CashBack earnings.

New York CUs Continue To Outpace National Growth Averages

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ALBANY, N.Y. (10/4/13)--New York credit unions continued to outpace national averages in asset growth, share growth, membership growth and loan growth during the first half of 2013.
 
The trends are highlighted in the second quarter 2013 New York Credit Union Performance & Trends Report, published by the Credit Union Association of New York in partnership with Callahan & Associates, Inc.
 
Share balances at New York credit unions rose by 5.9%--compared with the national credit union average of 4.7%--as regular shares and share drafts grew at a double-digit annual pace, said the report. Total shares outstanding stood at $56.2 billion as of June 30.
 
Capital levels remain strong at 10.8% of assets, said CUANY. This is a higher level than banks nationwide and banks and thrifts in New York, and is in line with credit unions nationwide.
 
The average member relationship--the outstanding combined loan and share balances per member, excluding member business loans--at New York credit unions also increased to $17,710 at the end of June.
 
New York credit union loan originations grew 7.7% over the first half of 2012 to $9.1 billion. The rise was due to strong growth in both first mortgage and business loan originations.
 
The state's credit unions originated close to $3.8 billion in first mortgages in the first half of 2013.
 
Business loans at New York credit unions rose 14.4% from June 2012, as member business loan originations through the end of the second quarter grew 17.8% from the first half of 2012. In aggregate, 14.3% of New York's loans are classified as business loans--more than double the U.S. average of 6.2%.

Equifax: Auto, Credit Card Loans Up In August

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ATLANTA (10/4/13)--The total outstanding balances in August on auto loans and credit cards rose from August 2012,with bank-issued credit cards experiencing increases in two consecutive months for the first time in five years, said Equifax's latest National Consumer Credit Trends Report.
 
Retail card balances have notched 24 consecutive months of year-over-year growth. The total balance of existing auto loans is at its highest level in more than five years, said Equifax.
 
The statistics are consistent with the Monthly Credit Union Estimates for August compiled by the Credit Union National Association, where credit union new-car loan balances are surging, with an 11.9% increase the past year. (See related News Now story CUNA: Loan Growth Leads a Strong August by using the link.)
 
Changes in balances from August 2012 to August 2013 included:
  • Auto loans, up 9.7% to $834.4 billion from $760.8 billion;
  • Bank credit cards, which rose 0.2% to $537.8 billion from $537 billion; and
  • Retail credit cards, which increased 7% to $55.9 billion from $51.9 billion.
Auto loan and credit card portfolios are the only two major segments in which rising balances accompany improving delinquency rates. Year-over-year changes in the 60-day plus delinquency rates, as a percentage of total balances outstanding, included:
  • Auto loans, whose delinquencies decreased more than 10%--to 1.14% from 1.28%;
  • Bank credit cards, which decreased more than 13%--to 1.81% from 2.10%; and
  • Retail credit card: decreased 0.9%--to 3.34% from 3.37%.
The data indicate that American consumers are being very disciplined in their use of credit, said Equifax Chief Economist Amy Crews Cutts.  "It's like they've gone on a debt-diet and they are really sticking to it, with modest increases in line with capacity to repay," she said.
 
"If we exclude student loans, total consumer debt is down 15% from its peak, and delinquency rates outside of home loans and student loans are back to pre-recession levels. Economic conditions are causing the lingering high default rates on student loans and mortgages, and hopefully we will see those improve more quickly in coming months," she added.
 
Other highlights from the most recent Equifax data:
  • Auto loans:  The total number of loans outstanding in August 2013 is more than 61 million, a 57-month high. By source, loans funded by credit unions, banks, or savings and loans total $401.7 billion, while the total number of loans is 29.5 million--a five-year high for both. The total outstanding balance for loans funded by auto finance companies is $432.7 billion, a 56-month high, while the total number of existing loans is more than 31.8 million, its highest level in 54-months. Also, the total balance of auto loan originations year-to-date in June 2013 is 237.6 billion, an increase of nearly 15% from same time a year ago and the most new credit originated for that time period in more than eight years.
  • Bank-issued credit card: At $93.3 billion, the total limit of new credit issued between January and June is a five-year high for that year-to-date period. It is also an increase of more than 68% over the recession low of $55.5 billion for the same time during 2010. The number of new loans year-to-date in June is 20.1 million, a five-year high and an increase of 6.3% from the same time a year earlier. Existing loans totaled more than 310 million, a 43-month high, while the total bank card credit limit is more than $2.4 trillion, a 43-month high.
  • Retail-issued credit card: At $34.2 billion, the total limit of new credit issued through June of 2013 rose nearly 33% over the recession low of $25.8 billion for the first six months of 2010. Between January and June 2013, roughly 18 million new loans were issued--the highest since 2008 and an increase of more than 7% over the same period last year. Year-to-date lending through June to subprime credit borrowers (with Equifax Risk scores below 660,) increased 15% over the period a year ago, and 5.9 million loans were originated, the highest in 5 years. Existing loans total more than 180 million, with the total retail card credit limit at nearly $350 billion.
  • Home finance: The total balance of first mortgages in August is $7.7 trillion, a decrease of 1.2% from same time a year ago. The total balance of first mortgage severe delinquencies (90-days past due or in foreclosure) is $300 billion, a decrease of more than 28% from same time a year ago and a five-year low. August's home equity revolving loans balance totaled $500.4 billion, a 7.4% decrease from that time a year earlier and a five-year low. August loans outstanding totaled 10.5 million, a five-year low. Severely delinquent home equity revolving loans for the month is3 is less than $9 billion, a 25% decrease from a year earlier and also a five-year low. The total balance of home equity installment loans is $136.7 billion, a 4.2% decrease from a year ago, while the total number of loans outstanding is four million, a five-year low.

CUs In the Media On Shutdown, Taxes, Credit Scores

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WASHINGTON (10/4/13)--The Credit Union National Association as well as credit unions told about the benefits of credit unions in several media articles this week on a variety of topics including credit unions' assistance to consumers affected by the federal government shutdown, the Don't Tax My Credit Union campaign and credit score tips.
 
Articles in the Des Moines Register and American Banker dealt with how credit unions and others are assisting with the shutdown's impact on family budgets.
 
"Credit unions are offering a variety of special services to members, so that no one should have to have to choose between paying the rent and buying groceries simply because of Washington's inability to function," Bill Cheney, president/CEO of CUNA, said in a statement in "Credit unions, banks ramp up aid to furloughed federal employees," an article in the Des Moines Register (Oct 3).
 
The current partial government shutdown highlights one of the competitive advantages of credit unions, which is a cooperative business model that allows them to share information about the best ways to help customers, said Paul Gentile, CUNA's executive vice president of strategic communications and engagement, in the same article. Numerous credit unions cater specifically to government workers and maintain contingency plans for a federal government shutdown, he said.
 
"This is not new for credit unions because so many cater to government workers," Gentile said. "You can't just turn on a switch. You have to have to have plans in place and they have to be compliant with regulations."
 
Also featured were the programs of Federal Employees CU in Des Moines, MCLG Family CU in Mason City, and Waterloo-based Veridian CU. Use the link to access the full article.
 
In the American Banker's Oct. 2 article about what financial institutions are doing to assist consumers through financial issues related to the federal government's shutdown, CUNA's Gentile said that at least half a dozen credit unions had already implemented plans to help their members while more were expected to make theirs public.  Credit unions were offering things like interest-free, short-term loans and letting members skip a payment on a consumer loan at no charge.  "From a member services standpoint, there is no better time to show your value than in times of need," he told the Banker.
 
In an article about the bankers' push to get Congress to eliminate credit unions' tax-exempt status for corporate income taxes, the Central Penn Business Journal (Sept. 27) noted credit unions' Don't Tax My Credit Union" social media campaign. The benefits of credit unions "far outweigh taxation," said CUNA's Gentile. He pointed out the $6 billion in benefits from the exemption flows back to the membership through the rate differential for savings and loans products, offering consumers better rates on loan. Also, credit unions provide a $2 billion benefit to nonmembers, including bank customers.
 
The article also featured Pennsylvania State Employees CU President Greg Smith, who said enacting a tax would put some credit unions, especially smaller ones, out of business, and Members 1st FCU CEO Bob Marquette, who added the cooperative, not-for-profit structure of credit unions puts them at an immediate disadvantage because they cannot sell stock, like banks, to raise capital. Use the link for the full article.
 
Also, Lathrup Village, Mich.-based Michigan First CU President/ CEO Michael Poulos was interviewed on Detroit FOX 2's "Money Monday" about ways consumers can improve their credit scores. Poulos gave advice based on the regular community seminars the credit union conducts on the topic, which he said attracts 100 to 200 members.

He also noted that auto loans and membership are up at credit unions because consumers are becoming more savvy about banks' high fees and poorer service. For his tips on improving credit scores, use the link.

Iowa CU Convention Honors Four

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DES MOINES, Iowa (10/4/13)--The Iowa Credit Union League (ICUL) honored four credit union representatives at the Iowa Credit Union Convention held in Des Moines Sept. 18-20 at the Community Choice Credit Union Convention Center.

Award winners included:
  • Kay Beyerink, president/CEO, Telco Triad Community CU, Sioux City, who received the 2013 Heritage Award for demonstrating extraordinary commitment, service and leadership in the credit union movement.
  • Jim Hagerman, president/CEO, Linn Area CU, Cedar Rapids, who was presented with the 2013 Professional Cooperative Spirit Award in recognition of outstanding service, commitment and leadership in the credit union movement.
  • Marilyn Rasmussen, board member,1st Gateway CU, Camanche, who received the 2013 recipient of the Volunteer Cooperative Spirit Award for exemplifying the spirit of the credit union industry and the communities they serve.
  • Josh Ernst, director of consumer lending, Linn Area CU, Cedar Rapids, who received the Young Professional of the Year Award for inspiring young Iowa credit union leaders who are working to build a strong future for the credit union movement.

Healthcare CUs Unite To Increase Opportunities

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LAS VEGAS (10/4/13)--Two dozen credit unions from the U.S. and Canada with a common bond--serving healthcare organizations--gathered in Las Vegas Sept. 18-20 for the annual conference of the Healthcare Credit Union Association.
 
The credit unions represent and serve all types of hospitals, healthcare networks and their employees.
 
The conference theme was Opportunity Screams, taken from the title of keynote speaker Tom Asacker's book, "Opportunity Screams: Unlocking Hearts and Minds in Today's Idea Economy."
 
Officers include:
  • Chair, Charlie Collura, CEO of Healthcare and Municipal Employees' CU, Ontario, Canada;
  • Vice chair, Shirley Cate, president/CEO of Providence FCU, Milwaukie, Ore.;
  • Secretary, Linda White, CEO of United Health CU, Burlingame, Calif.;
  • Treasurer, Todd Nelson, senior vice president of HealthCare Associates CU, Naperville, Ill.; and
  • Director at large, John Saatela, CEO of CarePoint FCU, Anaheim, Calif.
Attendees from HCUA's nearly 50 member credit unions heard interactive question and answer sessions that included an update from Martha Ninichuk of the National Credit Union Administration's Office of Small Credit Union Initiatives; a regional HCUA meeting led by Carol Bayreuther, CEO of Hartford (Conn.) Healthcare FCU; and a session on "Marketing in Healthcare," presented by Robert York, chief marketing officer of CalCom FCU, Torrance, Calif.

Board Elected For Iowa League

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DES MOINES, Iowa (10/4/13)--The Iowa Credit Union League announced the results of its board elections at its annual meeting Sept. 19 in Des Moines, Iowa.
 
Click to view larger image Members of the Iowa Credit Union League board, from left, front row: Jeff Hayes, North Star Community CU, Cherokee; Helen Pearce, Cedar Falls (Iowa) Community CU; Pat Jury, CEO/president, Iowa Credit Union League; Janine Keim, Consumers CU, Denison; Jim Hagerman, Linn Area CU, Cedar Rapids; and Joe Hearn, Dupaco Community CU, Dubuque. Back row: Tim Marcsisak, Nishna Valley CU, Atlantic; Murray Williams, league chief operating officer; Dennis Siemers, Town and Country CU, Harlan; Board Chair Tim Chapman, Members Community CU, Muscatine; Brent Helin, Des Moines (Iowa) Metro CU; Vice chair Dave Cale, Financial Plus CU, West Des Moines; Pat Drennen, 1st Gateway CU, Comanche; and Jonathon Miller, Dubuque Teachers CU. (Photo provided by Iowa Credit Union League)
By serving on the 12-member board, each individual represents the interests of Iowa's 116 credit unions and their more than one million members.
 
Tim Chapman, CEO, Members Community CU, Muscatine, was elected to serve as the 2014 board chair. Dave Cale, CEO, Financial Plus CU, West Des Moines, will serve as the 2014 vice chair.
 
Board members by asset category include:
 
$0 to 19 million assets:
  • Janine Keim, Consumers CU, Denison;
  • Jonathon Miller, Dubuque Teachers CU, Dubuque; and
  • Dennis Siemers, Town and Country CU, Harlan.
$19 million to $51 million assets:
  • Chapman;
  • Brent Helin, Des Moines (Iowa) Metro CU; and
  • Tim Marcsisak, Nishna Valley CU, Atlantic.
$51 million to $100 million assets:
  • Pat Drennen, 1st Gateway CU, Camanche;
  • Jeff Hayes, North Star Community CU, Cherokee; and
  • Helen Pearce, Cedar Falls (Iowa) Community CU.
$100 million-plus assets:
  • Cale;
  • Jim Hagerman, Linn Area CU, Cedar Rapids; and
  • Joe Hearn, Dupaco Community CU, Dubuque.

Redwood Teams With Community Group On $1M In Microloans

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SANTA ROSA, Calif. (10/3/13)--Redwood CU, based in Santa Rosa, Calif., has entered a strategic partnership with Community Action Partnership (CAP) Sonoma to help fuel the business economy in Sonoma County by offering up to $1 million in loans to microbusinesses and startups.
 
The microbusiness loans are the newest addition to the more than $2.2 billion asset credit union's small business and consumer loan programs.
 
In the partnership, RCU has committed up to $1 million in loan financing to graduates of CAP Sonoma's microbusiness development program to support growth and expansion of microbusinesses in the community.  The microbusiness development program has graduated 30 people since its inception.  CAP Sonoma provides financial education designed for small business owners and individuals who seek to start or currently own microbusinesses.
 
"RCU recognizes small and microbusinesses often have difficulty in obtaining the financing needed to initiate a business or expand," said Anne Benjamin, RCU's chief operating officer and executive vice president. "RCU is committed to our community and we believe funding the growth of microbusinesses is a positive way to impact these businesses as well as the economic growth and vitality of our county," she added.
 
CAP Sonoma's program includes 15 classes offered in both English and Spanish and is based on an enhanced NxLevel curriculum in which graduates must achieve at least 80% or greater on the final exam, have 80% attendance or greater, and have developed a business plan. CAP Sonoma added personal financial literacy and business financing readiness modules to augment the existing NxLevel curriculum.
 
The personal financial literacy course is based on the Federal Deposit Insurance Corp.'s MoneySmart curriculum. CAP Sonoma has offered financial literacy classes since 2004, and has graduated over 200 students from its personal finance program.
 
The program's graduates are owners or entrepreneurs of a variety of businesses, including a landscaping company, cleaning services, a palette recycling company, bakeries and a wholesale clothing outlet.

"As part of our program, we help our students draft a business plan, secure a mentorship with an existing business owner, and prepare them to meet with a loan officer," said Lannie Medina, chief development officer of CAP Sonoma. "RCU's extensive commitment to the success of the microloan program and our community overall has been inspirational and motivating," said Medina.

Credit unions have been urging Congress to lift their member business lending cap to 27.5% of assets from 12.25% so credit unions can make more MBLs.  Lifting the cap would help create 140,000 new jobs and inject $13 billion in small business loans into the economy, without costing taxpayers a dime, said the Credit Union National Association.

Align Strategy, Culture, Leadership For CU Success

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MADISON, Wis. (10/3/13)--If the competitive nature of today's financial marketplace is making it necessary for credit unions to switch their business strategy, it would behoove them to make certain their culture and leadership are tooled to drive that strategy, keynote speaker John Lass, CUNA Mutual Group senior vice president of strategy and business development, told participants of CUNA Mutual's Online Discovery Conference on Tuesday.
 
"Many credit unions are at an inflection point due to market changes, and they need to revisit their strategy," Lass said. "If you're at that point, you need alignment among your strategy, culture and leadership teams.
 
"Forces within the financial services arena are driving businesses to change their strategies, and credit unions are no exception," Lass said in his presentation, titled "The Power of Three: Leadership + Culture + Strategy."
 
"Think about the number of retailers, payment providers, platform players, the new regulations that you're having to deal with and all of the new channels you have to manage and master," Lass said. "For those reasons and more, many credit unions are at a strategic inflection point--the decisions you make today will dictate if your business goes on to new heights, or declines."
 
The strategies credit unions employ to avoid a decline may range from being a product or pricing leader to being exceptional at customer service. Whatever strategic road they go down, it's vitally important for credit unions to look at their culture and leadership team and determine whether they are tooled culturally, and from a leadership perspective to reach the level of success desired, Lass said. 
 
"Externally, you need to look at where your customers are and where you need to go," Lass said. "But internally, each leader has his or her style and strengths. The right leader has to be in place to execute your strategy. It's not about changing who the leadership is; it's building a leadership team and culture that aligns well together."
 
Online Discovery is CUNA Mutual Group's Web-based equivalent of a face-to-face conference without the associated expenses or time away from the office.

Indiana League Elects Two Directors, Officers

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INDIANAPOLIS (10/3/13)--Two newly elected members of the board of directors of the Indiana Credit Union League began their terms, and table officers were elected at the league's reorganization meeting on Sept. 27.
 
The meeting was held during the League's annual meeting and convention.

New directors Dallas Bergl, president/CEO of INOVA FCU in Elkhart, and Karla Salisbury, president/CEO of KEMBA CU in Indianapolis, were each elected to three-year terms on the board.

Table officers are:
  • Chairman: Dave Fleming, Union Baptist Church FCU, Fort Wayne;
  • Vice chairman: Doug True, FORUM CU, Fishers;
  • Board secretary: Matt Lambert, Encompass FCU, Tipton; and
  • Treasurer: Chuck Donovan, Members Source CU, Merrillville.
Also serving on the board are:
  • Lori Gonzalez, Members Choice FCU, Bloomington;
  • Frank Gulley, Afena FCU, Marion; and
  • George McNichols, Hoosier Hills CU, Bedford.

Online Discovery Attendees Told Lending Opportunities Aplenty

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MADISON, Wis. (10/3/13)--Despite competitive and other challenges, forecasts of modest economic growth provide great opportunities for credit unions to add to their bottom line in a member friendly way, Dan Kaiser, CUNA Mutual Group senior vice president of lending told a an Online Discovery Conference audience Tuesday.
 
Although vehicle loans are driving a rebound on lending, a more favorable economic outlook affords many other lending opportunities for credit unions to meet members' needs, while generating non-interest income for the credit union, said Kaiser.
 
"We know membership is growing in response to banks' bad behavior, so credit unions that are smart and aggressive have opportunities to grow by capitalizing on the recovery," Kaiser said. "Being aggressive on recapturing vehicle or home equity loans are prime opportunities and credit unions need to make their own judgment on direct and indirect lending, but it's an option they shouldn't discount."
 
A pressing regulatory environment and competition from several platforms create challenges for credit unions, Kaiser said. "Retail banking is also seeing opportunities to grow in an improving economy," he added. "The credit union lending protection model is fairer and much more member-friendly than banks and is more apt to survive regulatory scrutiny."
 
Kaiser advised credit unions to move towards a sales culture. Having products that benefit members is a two-pronged benefit--to members and the credit union, but it requires educating members on the benefits of products.
 
"In addition to traditional borrowing opportunities, lifestyle and 'green' lending not only respond to members' changing priorities, they are more opportunities to meet members' needs," Kaiser added. He cited cosmetic surgery, weight loss and adoption as examples of lifestyle lending opportunities and electric vehicles, replacement windows and insulation as green lending examples.
 
Credit unions may not be serving the "sweet spot" of credit union membership if they don't provide mobile banking, Kaiser said. "It's easy to look at smartphone lending use as a Gen Y issue," he said. "Actually, 55% of the 45-to-54 age group have a smartphone. If you're not providing mobile banking, you're not even meeting needs of current members."
 
Online Discovery is a free annual conference sponsored by CUNA Mutual Group that attracts a national and international credit union audience of more than 1,300.

Shutdown Showcases CUs' Best Efforts Helping Members

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MADISON, Wis. (10/3/13)--The federal government's partial shutdown is showcasing credit unions' best efforts to help members who will bear the financial brunt of  the shutdown, and the media are fast picking up on that fact. News reporters have told the Credit Union National Association they are impressed with how much faster credit unions have stepped up to the plate to assist members through the shutdown than banks have.
 
One tweet, from Generations FCU in San Antonio, says it all: "pr_gfcu: We don't need a #governmentshutdown to help our members. ANYTIME you need help, call your #creditunions @CUNA @Cornerstone_CUL.
 
Dozens of credit unions have indicated they are offering assistance to federal employees. Some are using Twitter and Facebook to inform members of their shutdown assistance. For example: "Cornerstone CUL: Dallas CU on gov't shutdown, 'Our members are essential to us, so we'll be there for them during uncertain times.' goo.gl/ios6aB." And FAA CU, Oklahoma City, Okla. tweeted: "@FAACreditUnion: We are offering assistance to government employees being impacted by the shutdown. Learn more at http://t.co/uqF9g8tQVa."
 
Belvoir FCU, a $317.9 million asset credit union in Woodbridge, Va., has traditionally been in the forefront in an area dominated by $1 billion + asset credit unions in taking action to help members, said Jason Lindstrom, Belvoir's chief marketing officer. "We have a military/Department of Defense contractor field of membership and are always actively trying to assist our membership when issues like this arise," he said.
 
Belvoir has a dedicated page on its website with information about how it will help members through furloughs. It offers an emergency loan of up to $5,000 at a fixed-rate of 4.99% annual percentage rate (APR) but at 0% for the first 60 days. The maximum term is 12 months and members can defer their first payment for 60 days.  Members also can meet with a loan officer to determine whether a loan workout program will ease the financial hardship.  It also allows the member to skip a regular consumer loan payment at no charge, and members can withdraw money early from their share certificates to weather the shutdown without a penalty.
 
Most credit unions with shutdown assistance provide the same types of services as Belvoir, with a variety of emergency loans with extra low or 0% rates and payment deferral; payroll replacement/advance assistance (temporary loans that replace the furloughed employee's salary); Skip-a-Payment programs; penalty-free share certificate withdrawals; and financial counseling or workout loans.

Others who have stepped up to the plate include:
  • Global CU, Spokane, Wash., which has $357 million in assets and serves members at Fairchild Air Force Base. "Our roots run deep with our military members," President/CEO Jack Fallis told the Northwest Credit Union Association (Anthem Oct. 1).  "If they do experience furloughs, we want to give them time and assistance to adjust. We've always been here for our members, and we are here now to help them through if they need us."
  • Scott CU, Edwardsville, Ill., an $930 million asset credit union that offers, among other assistance, the opportunity to borrow 100% of the member's most recent net two-week pay.  "We are hopeful that this will get resolved quickly," said President/CEO Frank Padak. "We really want to help them cover the next paycheck or two and then pay it back over the next six months as they work to get caught up."
  • Travis CU, Vacaville, Calif., which has $2.1 billion assets and "is once again prepared to provide support to all active duty and retired military as well as federal employees" impacted by the shutdowns "by offering extensions on loans, debt counseling, budgeting seminars and 0% interest loans." It also has met with the leadership of Travis Air Force Base and advised officials there of its services.
  • Tyndall FCU, Panama City, Fla., which told members, "We understand that the government shutdown and resulting furloughs will have a significant financial impact on many of our members, and we are committed to doing what we can to serve you by anticipating and responding to your needs."  The $1.13 billion asset credit union offers loan options, Skip-a-Payment, one-on-one assistance, credit cards or increases in credit limits, lines of credit, share-secured loans, checking account overdraft coverage and free budgeting software.
  • VyStar CU, Jacksonville, Fla., which says "Our No. 1 concern is our members and their families" It has programs to help with the uncertainty of a shutdown. The $4.9 billion asset credit union processed Oct. 1 direct deposits normally, will cover the Oct. 15 payroll for active duty members with direct deposit; and is offering emergency loans, pay and save loans, expedited line increases on current line of credit loans, and signature loans.  It also offers loan deferral assistance, expedited approval for credit cards, and penalty-free certificates withdrawals.
Other credit unions with similar programs include: Ent FCU, Colorado Springs, Colo.; EvergreenDIRECT CU, Olympia, Wash.; US Agencies CU, Portland, Ore.; Department of the Interior FCU, Washington, D.C.; and Meritrust CU and TECU CU, both of Wichita, Kan.  News Now reported 14 other credit unions with similar programs in two related stories, CUs Offering Help To Furloughed Fed Employees and CUs In Place To Assist Federal Employees.
 
Many view these programs as exceptional service.  Others view the services they offer as "business as usual."
 
"Our normal course of business includes working with our members by providing services like short-term income interruption loan when unusual events happen," said Lisette Comai-Legrant, assistant vice president of operations at First Alliance CU, a $138 million asset credit union in Rochester, Minn. "We help our members review their finances and determine what kinds of services they need to help them get through a rough patch," she told the Minnesota Credit Union Network.
 
Topline FCU, Maple Grove, Minn. echoed that. The $340 million asset credit union "stands ready to help any member affected by the government shutdown, just as we would help any member at any time who finds themselves with unexpected challenges in their lives," said Harry Carter, president/CEO.
 
And in case anyone misses the message, Jim Morrell, president/CEO of Peninsula Community CU, a $149 million asset credit union in Shelton, Wash.--which also offers online financial assessments and money-management classes--says it loud and clear. "If a member raises concerns about how they are going to manage their money," he told his employees, "please reiterate our mission:  We listen, we serve, we educate, we care...Always."
 
These programs are examples of fostering service excellence and building awareness of the value of credit unions to members and their community, chief tenets of the Credit Union National Association's and state leagues' Unite for Good campaign that is working to achieve the goal where Americans choosing credit unions as their best financial partner.  Use the links for more information.

Awards Recognize Exceptional League Communications

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CHICAGO (10/3/13)--The Northwestern Credit Union Association captured the Best of Show in the 35th Pro and Blockbuster Awards at the American Association of Credit Union Leagues' Communicators Conference in Chicago last week.

Click to view larger image The South Carolina Credit Union League won a Blockbuster Award in the "Best Campaign" category for its 2012 annual meeting at the American Association of Credit Union Leagues' Communicators Conference in Chicago last week. Accepting the award is Courtney Jackson, director of communications for the league.
State credit union leagues submitted 69 entries for this year's awards in 17 categories. Three judges from outside of the credit union industry scored the award submissions. 

Pro Awards honor the best in league public relations and publications. Blockbuster Awards pay tribute to excellence in marketing and advertising.
 
Northwest Credit Union Association was honored as the Blockbuster Best of Show for its logo design. The league captured the Pro Best of Show for its piece on the uniqueness of credit unions.
 
Blockbuster first-place winners include:
  • Best Print Ad--Georgia Credit Union Affiliates, Helping People Afford Life;
  • Best Sales Promotion--Pennsylvania Credit Union Association, 2012 PCUA Annual Convention;
  • Best Print Materials--Maine Credit Union League, How CEOs Sleep at Night;
  • Best Campaign--South Carolina Credit Union League, 2012 Annual Meeting;
  • Best CU Ad Campaign--Maine Credit Union League, Now is the Time Statewide Campaign; and
  • Logo Design--Northwest Credit Union Association, "2012 Convention Logo.
Click to view larger image The Kansas Credit Union Association won a Pro Award in the "Best Community Relations Program" category for its Make a Difference event with its October 2012 Gas Giveaway. Accepting the award is Susan Dyer, director of communications for KCUA. (Photos provided by the American Association of Credit Union Leagues)
Pro Award first-place winners include:
  • Blow Your Own Horn--Mississippi Credit Union Association, MSCUA 75th Anniversary;
  • Best Community Relations Program--Kansas Credit Union Association, Make a Difference Event, October 2012 Gas Giveaway;
  • Best Public Relations Project, Michigan Credit Union League, CU Lunch Local;
  • Best League Piece on Uniqueness of CUs--Northwest Credit Union Association, CU Philosophy Manual & Quiz;
  • Best League Publication (Newsletter)-- Credit Union Association of the Dakotas, The Memo;
  • Best League Publication (Magazine)--Missouri Credit Union Association, Missouri Courier;
  • Most Improved Newsletter--Michigan Credit Union League, Monitor;
  • Best League Annual Report--League of Southeastern Credit Unions, 2011 Annual Report;
  • Website--Michigan Credit Union League, CUBE TV;
  • Online Publication--Michigan Credit Union League, CU National Update, and
  • Best Use of Social Media--Georgia Credit Union Affiliates, Credit YOUnion Facebook page.

Ex-Kenyan Ambassador Joins World Council, Provides Updates On Employees Impacted By Terrorism

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MADISON, Wis. (10/3/13)--
Elkanah Odembo is World Council of Credit Unions' new vice president of the African region. (Photo provided by World Council of Credit Unions)
Elkanah Odembo, former ambassador of the Republic of Kenya to the U.S., has been named vice president of the African region for World Council of Credit Unions. One of his first acts was to provide updates about World Council employees in Kenya related to the Nairobi mall terrorist attack last week.
 
Odembo, who will be based in Nairobi, oversees World Council's strategic initiatives for its organizational members and the donor community in the region.
 
"World Council's member organizations throughout Africa face unique trends and key issues," said Brian Branch, World Council president/CEO. "We are privileged to have Elkanah's extensive experience in strategic leadership, advocacy and community development within the region."
 
From left, World Council of Credit Unions President/CEO Brian Branch meets with Elkanah Odembo during a reception at the Kenyan Embassy in Washington, D.C. (Photo provided by Larry Glatt)
Odembo has led a wide range of community development projects based in Africa. He most recently served as Kenya's ambassador to the U.S.  and previously to France. As ambassador, Odembo advocated on behalf of Kenya's credit unions, known as savings and credit cooperatives (SACCOs), for improved legislation. He supported the founding of the first Kenyan SACCO to serve the Kenyan diaspora in the U.S.
 
Odembo was also the founding director of Ufadhili Trust, a Nairobi-based organization that promotes philanthropy and the use of local resources for social development through corporate social responsibility, cross-sector partnerships, technical assistance and policy research. Prior to that, he served as a consultant to the Ford Foundation's Africa Philanthropy Initiative; the East Africa representative for the international non-governmental organization, World Neighbors; and as a research officer for the African Medical Research Foundation.
 
Odembo earned a master's degree in public health from the University of Texas. He holds a bachelor's degree in biology and sociology from Bowdoin College in Maine.
 
As to the recent terrorist attack at a popular mall in Nairobi, World Council confirmed that none of its employees stationed in Kenya were injured. However, almost all staff members were impacted by the tragedy that injured and took the lives of friends and family. Gunmen stormed the mall on Sept. 21, killing at least 67 people.
 
"Kenya has just been through a most challenging moment, and it is not over yet," said Odembo. "Through it all, however, Kenyans have demonstrated incredible resolve and goodwill. With World Council's help, we will continue working together to build an even stronger community that stretches beyond our country's borders."

CUNA Mutual Expects Broader Reg Focus In 2014

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MADISON, Wis. (10/3/13)--Credit union compliance staff need to be aware of the Consumer Financial Protection Bureau's (CFPB) quickly approaching deadlines as 2013 concludes, attendees of CUNA Mutual Group's fourth annual Online Discovery Conference were told by the company's Lauren Capitini and Jon Bundy.
 
"A look at the CFPB's semiannual regulatory agenda indicates the agency is moving full speed ahead on additional rulemaking," said Bundy, CUNA Mutual regulatory compliance manager. "From this report, we're able to predict what credit union compliance officers can expect to hit their desks over the next six months."
 
"Right now, credit unions should be focused on implementing changes to comply with the CFPB's [seven] new mortgage rules issued in January," said Capitini, CUNA Mutual regulatory compliance manager, during her "Mortgage Myth Busters" session, which tackled myths about new mortgage regulations. "The mandatory compliance dates for most of these new rules are in January, so credit unions really need to be putting the pedal to the metal."
 
The CFPB continuously made updates to the seven new mortgage rules over the summer, and only recently finalized the rules. Final updates to the rules include:
  • Clarifying the flexibility available to credit unions when dealing with delinquent borrowers;
  • Finalizing the rule prohibiting the financing of credit insurance premiums for some types of mortgage loans; and
  • Changing the effective date for the loan originator compensation rule to Jan. 1, 2014.
Capitini reminded audience members that other rules outside of the mortgage arena are also quickly approaching, including new remittance transfer rules which go into effect Oct. 28.
 
Also, an additional mortgage rule to combine the mortgage disclosures under Regulation Z (TILA) and Regulation X (RESPA) is expected from the CFPB later this month, Capitini said. "This [additional] mortgage rule will completely revamp the disclosure requirements connected to the loan event, making the end of 2013 a busy time for mortgage lenders," said Capitini.
 
Bundy's session, "Lending Compliance Pipeline: What May Be Coming," focused on the CFPB's radar and looking ahead to 2014.
 
"We anticipate the CFPB will modernize deposit regulations by the end of 2013," said Bundy. "Members may not see much of a practical change from the new rules; however, credit unions will likely have to learn new time periods for funds availability and new model disclosures."
 
The CFPB could do so by finalizing revisions to Regulation CC, the Expedited Funds Availability Act's implementing regulation, to accommodate an all-electronic interbank check collection and return process by the end of 2013, Bundy explained.
 
"Looking ahead to 2014, credit unions can expect to see the CFPB expand its fair lending focus," said Bundy. "The CFPB's regulatory agenda unmistakably signals that fair lending will be a focal point of new rule making starting in 2014."
 
The start of this effort will be a hard look at the data-gathering requirements under the Home Mortgage Disclosure Act and will later expand into possible rules mandating the collection of credit application data for credit unions involved with business lending, Bundy said.
 
Other potential regulatory changes on the CFPB's radar include:
  • Possible revised disclosures for student loans and credit cards;
  • Payday lending and payday alternative loans; and
  • Overdraft protection.
Online Discovery is an annual conference sponsored by CUNA Mutual Group that attracts a national and international credit union audience of more than 1,300.

Discovery Speaker: Predictive Analytics a Powerful Tool

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MADISON, Wis. (10/3/13)--More organizations across industries are using predictive analytics to determine consumer behavior and improve their success. Despite not having large analytic staffs, credit unions could benefit from using existing predictive analytics technologies to bolster their business and better serve members, a senior TruStage executive told an Online Discovery audience Tuesday.
 
The online conference was sponsored by CUNA Mutual Group. TruStage is CUNA Mutual Group's direct-to-consumer brand for insurance and investment products.
 
Simon Gao, vice president, TruStage consumer analytics, defined predictive analytics as a set of business intelligence technologies that uncover relationships and patterns within large volumes of data to predict future behavior and events.
 
"Do you ever wonder how Netflix has such great movie recommendations for you or how Target sends you just the right coupons? The answer is these companies, like many others, are predicting your behavior," Gao said.
 
Predictive analytics is forward-looking, using past events to anticipate the future. Existing data are modeled to help business leaders make decisions more accurately, objectively and economically. Although credit unions could potentially gather a plethora of member information, Gao suggested the following information might be useful for credit unions to initially collect and model:
  • Most popular services used by members;
  • Manner in which members are accessing your services--online, in-branch or at the ATM; and
  • Branch locations members are visiting and when.
Predictive analytics could help credit unions with marketing and risk management in particular, Gao said. "In marketing acquisition, targeted programs are still the best way to go," he added. "If your credit union is not doing individualized targeted marketing, you should investigate this approach."
 
Predictive analytics can help credit unions create targeted cross-sell and up-sell offers. "It helps identify the most effective contact strategy to reach members, and which products and services to offer to more effectively grow and retain members," Gao said.
 
The CUNA Mutual Group MemberCONNECT Program uses predictive analytics in the direct marketing of TruStage insurance to identify the best consumers to target. Factors built into its modeling include propensity to respond, likelihood of conversion, persistence and lifestyle factors. "We test various models to identify what message or combination of messages is the best for a particular segment of consumers, so the creative tests would identify winning approaches with the biggest impacts," Gao said.
 
Consumers also benefit from predictive analytics through the receipt of more relevant and targeted offers, better products and services, and cheaper prices through greater marketing efficiency.
 
Credit unions don't need large staffs to take advantage of existing predictive analytics technologies. "You may not be able to do the modeling in-house, but you can purchase vendor products, similar to those you use with FICO credit scores in loan underwriting," Gao said.
 
Most companies start by leveraging their existing analytics staff, who have the best knowledge of existing databases. Many predictive analytics consulting companies that can assist credit unions in getting set up.
 
Predictive analytics is not a fad, Gao said. "Organizations are already struggling with too much data. Predictive analytics is the most powerful solution to the 'too much data' problem, and it has proven to have an outstanding return on investment," he added.
 
Online Discovery is an annual virtual conference sponsored by CUNA Mutual Group that attracts a national and international credit union audience of more than 1,300.

Online Discovery Conference: Mobile's Impact On Business Models

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MADISON, Wis. (10/2/13)--To succeed in a competitive financial services marketplace, credit unions need to adopt a "mobile first" digital strategy, Kevin Miller, CUNA Mutual Group's vice president of information technology, urged Online Discovery credit union attendees Tuesday.
 
The dramatic rise in smartphone and tablet use is changing customer expectations, putting longstanding companies out of business while providing fertile growth opportunities for others, said Miller.
 
The explosion of digital devices has changed the landscape of many industries, negatively affecting stalwart companies such as Eastman Kodak, Borders Books and Blockbuster Video, among others, he added.
 
"These were big, respected companies with powerful brands and histories run by talented and smart individuals," Miller said. "Yet, new technology devices stressed their business models and overwhelmed them. Unfortunately, many ran out of time to fight back."
 
Miller offered attendees these tips:
  • Embrace digital disruption--The rules have changed. Whereas the big used to eat the small, the fast now eat the slow. Barriers to entry are smashed, the cost to compete is low and everyone can exploit the same economics. Anyone can win.
  • Expect and recognize evolving consumer expectations--Start with the customer and work backwards to solve their problems, recognizing their needs will change quickly.
  • Develop a "mobile first" digital strategy.
  • Enjoy winning AND failing--Ideas are often killed by concerns with viability or cost. Even if an idea doesn't work today, it could lead to new ideas in the future.
  • Recognize it's not "either/or" but "all." Maintain and modify existing business models while adding new ones.
Big technology trends--social media, big data, analytics and cloud--all converge with mobile. "The No. 1 mechanism for participating in social networks is via a smartphone," Miller explained. "Most cloud application designs have a 'mobile first' approach and an expectation that mobile devices are the primary user interface.  Likewise, people want big data insights delivered to their mobile phone."
 
To avoid the fate of some other companies, credit unions need to be aware of technology trends and the impact on their business models. "Banking is moving toward a contextual, customer-centric view as competitors better leverage proximity, preference, and proliferation of engaging experiences," Miller said. "We are moving away from banking relationships defined by the goal of being a customer's primary financial institution to one where we focus on becoming their primary financial application."
 
Online Discovery is an annual conference sponsored by CUNA Mutual Group that attracts a national and international credit union audience of more than 1,300.

CUs Offering Help To Furloughed Fed Employees

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MADISON, Wis. (10/2/13)--Once the federal government announced its partial shutdown Tuesday, credit unions lost no time in letting impacted members know their credit unions will provide special rates, skip-a-payments, financial counseling and more to ensure members survive any furloughs with their finances intact.
 
Many credit unions with federal employees already had in place special programs from past shutdown threats and were ready from Day One of the shutdown.
 
"Andrews Federal stands ready to provide our members with financial assistance and options to help curb the adverse effects that the government shutdown may cause," said Jim Hayes, president/CEO, Andrews FCU, Suitland, Md.
 
It will offer a Bridge Loan up to $5,000 at a 0% annual percentage rate (APR) for 90 days. After 90 days, the standard APR will apply. It also will have flexible terms up to a year and offer payment options to manage the loss of income.
 
The $900 million asset credit union serves more than 100,000 members in the District of Columbia, on bases in Maryland and New Jersey, and military installations in central Germany, Belgium, and the Netherlands.  It also serves select employee groups in D.C., Maryland, and New Jersey.
 
Redwood CU, Santa Rosa, Calif., sent an e-mail to members Tuesday letting them know the $2.2 billion asset credit union is there to support them. It is placing information on its website.
 
"RCU's No. 1 priority is assisting our members, especially during times of uncertainty like the current government shutdown," said Robin McKenzie, senior vice president at RCU.  "We encourage members employed by the federal government or agencies impacted by the shutdown to contact us for assistance."  McKenzie noted some of its services include:
  • Payroll replacement/advance assistance;
  • Deferred payments on RCU loans and lines of credit;
  • Early withdrawal of funds from RCU share certificates without penalties; and
  • Money management and budgeting information and tools.
Hanscom FCU at Hanscomb AFB, Mass., which serves federal employees in Massachusetts, said its members will have access to a 0% APR interest line of credit--called a Life Line Loan--for 60 days, equal to one month's net payroll up to $5,000.  The interest-free loan is attached to the member's checking account to provide additional funds to cover checks, ATM withdrawals and debit card purchases.
 
The $1 billion asset credit union also will waive penalties for premature withdrawals on term share certificates and provide free, confidential financial counseling and education through its BALANCE Financial Fitness.  Members can schedule a one-on-one phone session with a certified financial counselor for help with budgeting, managing credit and assessing their finances.
 
"We have supported our members affected by furloughs over the summer, and we continue to be here for members," said Paul Marotta, Hanscom FCU's board chairman.  "We are true to our roots and the credit union motto, 'People Helping People.'"
 
At Jacksonville, Ark.-based Arkansas FCU, "we've been through this before, so we're prepared to do anything and everything we can to make sure the men and women who serve our country will be well taken care of" in a shutdown, said Larry Biernacki, president/CEO. He urged members to call the credit union if the shutdown threatens their well-being.
 
"Thousands of our members rely on a government paycheck to make their automatic loan payments, credit card payments and more each month," Biernacki said. "We want those members to know we are willing to work out an arrangement on an individual basis if a government shutdown interrupts their normal financial well-being."
 
Other credit unions offering assistance include:
  • Wright-Patt CU Inc., a $2.7 billion asset credit union in Fairborn, Ohio, which is offering a special "Shut Down" loan that is an unsecured loan equal to the member's normal federal net bi-weekly pay at 6.25% APR up to 12 months for qualified borrowers. If the loan is paid back within a month, Wright-Patt will waive the interest. Its skip-a-payment program charges no fee or late fee, the loan won't show up as delinquent and it will not generate a derogatory report to the credit bureau.
  • Members 1st CU, Redding, Calif., which is offering financial assistance to all federal government employees who live, work or worship in Shasta and Tehama Counties--regardless of whether they are members of the credit union or not. It will provide 0%-interest payroll assistance loans up to $3,000 for 12 months, fee free, and personal loan options with different rate options for terms 24-36 months.  Members with existing loans will have additional flexibility with modified payments or skip payments.  And federal employees will receive expedited review and approval for line increases or new credit lines on their Members 1st credit card.
  • NASA FCU, Upper Marlboro, Md., with assets of more than  $1.2 billion, which is offering 3% APR  on  a line of credit to members with checking accounts and direct deposits and who are subject to the furloughs. The special rate is effective through Dec. 31.
  • Chartway FCU, Virginia Beach, Va., with more than $1.9 billion assets, which told members on its website it has pledged "to do whatever it takes to help you adjust to this shutdown by extending leniency and special considerations to ensure you have the support you need and the money you require."
  • Veridian CU, Des Moines, Iowa. The $2.5 billion asset credit union announced Tuesday it would provide interest-free, 30-day loans to members experiencing delays in payment as a result of the shutdown.
  • Fort Knox FCU, Radcliff, Ky. The more-than-$1 billion asset credit union is offering interest-free loans for one month to cover lost pay, extended terms on existing loans to reduce monthly payments, and the opportunity for early withdrawals up to $10,000 on term share certificates without an early withdrawal penalty.
Credit unions that go above and beyond in looking out for members' interests are demonstrating one of the key tenets of the national Unite for Good campaign: fostering service excellence.  The campaign, launched by the Credit Union National Association and the state leagues, is rallying credit unions to work toward the goal in which Americans choose credit unions as their best financial partner.  Use the links for more information.  Also, see today's related News Now story, For CUs: Agencies' Status During Gov't Shut Down.

Top 10 News Now Articles For September

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MADISON, Wis. (10/2/13)--An article about the National Credit Union Administration's approval of changes to its fixed-asset regulation was the most-read News Now article in September. Although the amended rule did not make any substantive changes, the Credit Union National Association has said the plain language revisions, new definitions and revised wording could help credit unions with their compliance efforts. It goes into effect Nov. 18.
 
The top 10 articles in September included:
 
10. CUNA Don't Tax Tuesday Again Boosts Advocacy Efforts

WASHINGTON (9/11/13)--The newest phase of a credit union social-media advocacy blitz targeted at Capitol Hill to deliver the message "Don't Tax My Credit Union" paid off big Tuesday. It brought the total numbers of hits to the Credit Union National Association's www.DontTaxMyCreditUnion.org site to over 1 million views since being launched in May and helped the campaign generate an overall total of 850,000 messages to members of Congress.
 
9. Fed Doesn't Reduce QE3 Spending, Maintains Interest Rates

WASHINGTON (9/18/13)--The Federal Reserve's policymakers today again decided not to reduce its quantitative easing policy of buying $85 billion in Treasury bonds and mortgage-backed securities, saying that although market conditions have improved somewhat, the "unemployment rate remains elevated." Instead, the Federal Open Market Committee "decided to await more evidence that progress will be sustained before adjusting the pace of its purchases."
 
8. PPI In U.S. News: 'Don't Make CUs Die For Banks' Sins'

WASHINGTON (9/18/13)--Jason Gold, senior fellow for financial markets policy for the Progressive Policy Institute--a Washington, D.C.-based "think tank" established in 1989--took to the pages of U.S. News and World Report this week to urge loud and clear, "Don't makes credit unions die for banks' sins."
 
7. NCUA Sues 13 Alleging LIBOR Manipulation

ALEXANDRIA, Va. (9/23/13)--The National Credit Union Administration today filed suit in federal district court in Kansas against 13 international banks, including J.P. Morgan Chase. The suit alleges violations of federal and state anti-trust laws transacted by manipulation of interest rates through the London Interbank Offered Rate (LIBOR) system.
 
6. Matz Announces NCUA To Propose Stress Testing Rule

COEUR D'ALENE, Idaho (9/18/13)--National Credit Union Administration Chairman Debbie Matz announced this morning that the agency's Office of National Examinations and Supervision is drafting a requirement for annual stress tests at credit unions with assets exceeding $10 billion.
 
5. NCUA Issues Guidance On Loan Participation Rule

WASHINGTON (9/19/13)--The effective date for the National Credit Union Administration's new loan participation regulation is almost at hand--Sept. 23--and the agency today issued supervisory guidance on the rule.
 
4. NCUA Identifies States With Greatest Membership Growth

ALEXANDRIA, Va. (9/5/13)--The newest analysis of state-level data for federally insured credit unions was released this morning by the National Credit Union Administration and among its revelations: Idaho and Virginia were the top states for membership growth in the year ending in the second quarter.
 
3. CFPB Readies Mortgage Final Rule Changes

WASHINGTON (9/13/13)--The Consumer Financial Protection Bureau this afternoon released some details of yet another final rule amending its Ability-to-Repay, Mortgage Servicing and Mortgage Loan Originator Rules, which were originally finalized in January of this year.
 
2. NCUA, Fed Agencies Release Elder Abuse Prevention Guidance

WASHINGTON (9/24/13)--The National Credit Union Administration today joined six other federal financial regulators to clarify that financial institutions may report suspected elder financial abuse to appropriate authorities.
 
1.  NCUA Approves Final Version Of Fixed-Asset Reg Changes

ALEXANDRIA, Va. (9/12/13)--The National Credit Union Administration just minutes ago approved a final version of fixed-asset regulation changes.

CUNA: Loan Growth Leads a Strong August

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MADISON, Wis. (10/2/13)--Credit union loans, membership and savings all went up in August, according to the August monthly sample of credit unions by the Credit Union National Association. Loan growth year over year is the quickest in five years, said a CUNA economist.

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CUNA released its Monthly Credit Union Estimates Tuesday. Credit union loans totaled $643.8 billion in August, compared with $605 billion in August 2012. Credit union loans outstanding grew 1.1% in August, led by adjustable-rate mortgages (a 1.9% growth), unsecured personal loans (1.8%), new-auto loans (1.5%), used-auto loans (1.3%), fixed-rate first mortgages (1%) and credit card loans (1%). Other mortgages and home equity loans each declined 0.2%.
 
"Credit union loan growth is surprisingly on the upside with balances increasing 1.1% in August and 6.4% year over year," Steve Rick, CUNA senior economist, said Tuesday. "This is the fastest pace since the 6.7% increase in 2008. With car sales reaching more than 15 million units this year, credit union new-auto loan balances are surging. Over the past year, new-auto loan balances increased 11.9%--the fastest growing credit union loan category.
 
"Credit unions are holding more fixed-rate mortgages on their balance sheet rather than selling them off into the secondary market," he added. "Fixed-rate first mortgage loan balances rose 1% in August and 10.5% year over year.
 
"Deleveraging in the home equity loan category is slowing as balances fell only 3.7% over the last year, compared with a 4.1% decline in the year ending August 2012," Rick continued. "With home prices rising 8% to 10% across the country, home-equity loan balances should start rising again in 2014."
 
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Credit union savings balances totaled $932.6 billion in August--or $40.3 billion more than the $892.3 billion in August 2012, said CUNA's report. Credit union savings balances grew 0.9% for the month, compared with a 0.5% decrease in July. The increase is a reflection of three paydays during August with the last payday landing on the last day of the month, CUNA said. Share drafts grew 6.9%, money market accounts were up 0.5%, and regular shares grew 0.1%. On the decline were one-year certificates, which dropped 0.3%, and individual retirement accounts, with a 0.1% decline.
 
"Savings-balance growth is surprising on the down side in 2013, with year-over-year growth of only 4.5%," Rick said. "Pent-up demand for durable goods, negative real deposit interest rates, 5% higher fuel costs and the expiration of the payroll tax cut are all reducing the pace of savings growth."
 
Total credit union membership grew 0.4% during August and now totals 98.3 million.
 
The movement's overall capital-to-asset ratio remained at 10.2%. The total dollar amount of capital is $110 billion.
 
Credit unions' 60-plus-day delinquency rate has remained at 1% for the past six months.
 
With loan growth outpacing savings growth during August, the loan-to-savings ratio increased to 69% in August from 68.9% in July. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--is 17.8%.

CU System Briefs (10/02/2013)

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  • HARRISBURG, Pa. (10/2/13)--Gubernatorial candidate John Hanger (D) visited the Pennsylvania Credit Union Association Monday in Harrisburg, and met with staff and representatives of the area's credit unions.  He shared his vision for the Commonwealth and was interested in learning more about credit unions, said PCUA (Life is a Highway Oct. 1).  From left are: Paul Wagner, CEO of Hershey FCU, Hummelstown; Hanger; Pamala Mohn, CEO of Blue Chip FCU, Harrisburg; and Abby Kiebach, CEO, Lancaster Red Rose CU, Lancaster. (Photo provided by the Pennsylvania Credit Union Association) ...
  • KANSAS CITY, Mo. (10/2/13)--The Kansas City (Mo.) Chapter of Credit Unions welcomed 11 lawmakers and staff to its annual legislative breakfast Sept. 19. Advocates from credit unions across the region met and discussed credit union issues with state lawmakers. "It's important for lawmakers to recognize and know the credit union leaders in their own districts," said Amy McLard, senior vice president of advocacy for the Missouri Credit Union Association. "Credit union staff and advocates participated in lots of good discussions with lawmakers throughout the event, and that helps to build and reinforce those relationships (The Missouri Difference Sept. 20) ...
  • FARMERS BRANCH, Texas (10/2/13)--Phyllis Groff, former CEO of Texas Workforce CU, San Antonio, died Sept. 26. The first paid employee of the credit union, Groff served as CEO from 1986 to 1998, said the Cornerstone Credit Union League (Leaguer Oct. 1). She is credited with bringing the credit union from operating out of the bottom of a desk drawer in the Texas Employment Commission to financial institution status.  Although she retired in 1998, Groff continued to volunteer and offer her support to the $9.5 million asset credit union.  Memorial Mass will be at 6 p.m. Friday at St. Ann's Catholic Church, La Vernia, Texas ...

'Data Craze' Gets In-depth Look In CUNA Tech Council Paper

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MADISON, Wis. (10/2/13)--A new white paper from the CUNA Technology Council describes how credit unions are using big data and predictive analytics to improve their business intelligence potential.
 
"The Data Craze: Perspectives on Big Data, Predictive Analytics, and Business Intelligence," covers the benefits of data-driven decisions, applying data and business intelligence strategically, the types of data at the credit union, cautions and pitfalls, the human element, whether the data craze signifies a culture shift, implementing plans, finding data management solutions, and working with vendors.
 
How and why credit unions use business intelligence to mine, analyze, report and apply data to make business decisions varies depending on the needs of the specific credit union at a specific point in time, according to Datawatch Corp. Among the examples of data sets used by Datawatch clients used for business intelligence:
  • ATM settlements. Credit unions can mine data from optimization reports to identify transactions that appear in one report and not another, to complete daily ATM settlements much faster.
  • Accrued interest reports. Credit unions can filter out specific loans--for example, those that are 60-plus days delinquent--to automatically calculate the correct accrual under generally accepted accounting principles.
  • Certificate offerings. Using a share certificate trial balance report, and selecting and creating new fields or columns of data, credit unions can categorize certificates based on different ranges of interest rates. Using information optimization, the data allows "what if" analyses and "accounting intelligence" scenarios.
  • Daily teller reports. Business intelligence and data analytics systems allow credit unions to take voluminous reports with thousands of transactions and summarize by branch, member, or any other type of data.
  • Internal auditing. With specific business intelligence tools, credit unions can mine data from historical loan origination reports and pull it into data tables for sorting, filtering, or new calculations. Credit unions can create summaries to see subtotals and grand totals by fine detail--such as Top 10 loan products, loans and loan amounts by loan officer, loan term, risk assignment and charge-offs.

Discovery: Growing Investment Programs Benefits CUs, Members

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MADISON, Wis. (10/2/13)--Investment and insurance products are the largest potential untapped source of member-friendly, non-interest income for credit unions, attendees of CUNA Mutual Group's fourth annual Online Discovery Conference were told Tuesday.
 
"Growing your credit union's investment program is not only good business, but it's good for business," said Hendrix Niemann, managing director of practice and wealth management services for CUNA Brokerage Services, Inc.
 
Niemann's session, "Growing Your Investment Program to Increase Non-Interest Income and Member Loyalty," provided insights into why credit unions should offer an investment program.
 
To grow a credit union's investment program, the credit union must:
  1. Obtain senior management and board buy-in and commitment;
  2. Dedicate time and resources to member education; and
  3. Market the investment program to current and potential members.
"Offering a strong investment and insurance program pays dividends in multiple ways," Niemann said.
 
Credit unions lose an average of $165 on certificates of deposits but make an average of $177 by providing investment products to their members, according to recent Raddon Financial Group research. That means converting CDs to investment accounts can potentially result in a substantial increase to bottom-line revenue, while improving the capital ratio, Niemann told attendees.
 
Credit unions attract about 3% of their members' investment dollars, while almost half (46%) of members have investment accounts elsewhere, he added, citing Filene Research Institute statistics for 2012.
 
However, a recent Kehrer Saltzman & Associates study found that members who purchased investment and insurance products from their credit union were 40% more loyal than those who did not, and were two-thirds more likely to consider the credit union their primary financial institution.
 
"The importance of this 'stickiness factor' cannot be overemphasized," said Niemann. "Offering an investment program will lock in additional revenue for many years to come, and it's beneficial for members, too."
 
Older members need to be educated on retirement income planning and healthcare planning while younger members need help getting started with investing, he said.
 
"Who's going to give your members sound financial advice if you don't?" Niemann asked. "Credit unions need to start treating their investment programs as core products."
 
Niemann emphasized that marketing the program is key to its success. According to recent Raddon Financial Group research, 54% of credit union members did not know if their credit union offered an investment program, and 16% were not aware of their credit union's investment program.
 
"The statistics and demographics are in our favor; whether credit unions take advantage of this opportunity is yet to be seen, though," Niemann concluded.
 
Online Discovery is an annual conference sponsored by CUNA Mutual Group that attracts a national and international credit union audience of more than 1,300.

CUNA Implements OneID For Login On CUNA.org

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MADISON, Wis. (10/2/13)--The Credit Union National Association announced Tuesday the implementation of OneID, a digital identity provider that delivers a secure, simple way for users to log into CUNA.org--eliminating the need for usernames and passwords.
 
OneID is a CUNA Strategic Services alliance provider.
 
"Passwords and login can be a frustration point with users," said Tom Nohelty, CUNA vice president of information technology. "CUNA was looking to improve our user experience while maintaining security. By working with OneID we are able to deliver both."
 
To set up a OneID, users can click on the login button on the CUNA.org home page, then follow the directions to set up an account. Once validated, login names and passwords will no longer be required each time a user accesses CUNA.org. Users will click or tap to immediately access their account, and with stronger security than the traditional username and password system can offer.
 
"CUNA had many of the same requests that we hear from its member credit unions: Help me offer the most convenient experience for my users while strengthening my protection against today's sophisticated threats," said Steve Kirsch, OneID founder and chief technology officer.  "As we roll out with credit unions across the country, our presence on CUNA.org is the perfect showcase for how OneID streamlines login from any device."
 
OneID provides its users with a digital identity service beyond CUNA.org.  With OneID, users can log in wherever OneID is accepted--all without the need for usernames and passwords.  By downloading the QuickFill browser extension, OneID users can avoid the hassle of form-filling on any site on the Web.

Diebold: Consumers Expect More From FIs

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NORTH CANTON, Ohio (10/2/13)--According to new research from Diebold, financial services providers have not completely met consumers' expectations for secure, convenient access to those services. Consumers want a more personalized relationship with their credit union or bank that allows them to be confident about their financial decisions without putting in a lot of extra effort, Diebold's research found. 
 
Diebold is a CUNA Strategic Services provider. 
 
 Diebold, in partnership with Lextant, an ideal experience consultancy, conducted research with more than 100 consumers in eight countries to produce qualitative data about how they want to interact with their financial institutions.
 
Consumers surveyed said they want control of their finances regardless of the channel they use, expect seamless interactions that offer the same interface and information--in real time--via mobile, online, ATM, call center or the branch.
 
Services respondents expect but don't always receive included:
  • Absolute accuracy of information;
  • Security of financial account and personal info;
  • Reliable access to their money and account information;
  • Personalized help for troubleshooting; and
  • Professional interactions with competent financial institution personnel.
Consumers aren't using banking channels--specifically the branch--the same way they used to, according to the research. They want a hybrid service model that offers face-to-face and self-directed options, Diebold said.
 
Consumers said they expect accuracy and updates in real time, regardless of the channel. Accurate account tracking is one of the most important consumer expectations a financial institution can meet. For example after consumers deposit checks at an ATM, they should be able to verify an updated account balance through a mobile device immediately. All banking channels should operate off the same back-end system, Diebold said.
 
Reliability and security from their credit union or bank also were high in consumers' expectations. Financial information must be secure and accessible to consumers through varying, convenient access points, Diebold said. Consumers said they are concerned about cyberhacking, fraud and other breaches and depend on their financial institutions to keep their money and information secure.

CU Launches Corporate Social Responsibility Program

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KANSAS CITY, Mo. (10/2/13)--Mazuma CU has launched a new corporate social responsibility program that will focus on three key areas: community development, education and the arts. To support these causes, 5% of the year's earnings will go toward local organizations in these three categories.
 
"We want to make a real impact on the things we value most in Kansas City," said Mazuma President/CEO Brandon Michaels.
 
An innovative part of the program is an initiative called "40 Hours for Good." It gives all Mazuma team members 40 hours of paid time to volunteer in the community during the year. Similar programs in the industry average 10 to 15 hours.
 
"We're serious about making our community better, so we're not just throwing money at it, we're volunteering our time as well," Michaels said.
 
The new initiative builds on Mazuma's longstanding heritage of charitable outreach and community development. It also provides a formal structure for Mazuma team members to more easily continue their self-motivated volunteer activities. "All of us have values we passionately believe in," Michaels said. "So we've created opportunities for our team members to see those values in action."
 
In addition, Mazuma has launched a new website, www.mazuma.org/happytohelp, which details the multitude of ways the credit union contributes to the Greater Kansas City-area community. The site also includes an e-mail address, happytohelp@mazuma.org, where organizations can send requests for support of their causes.
 
"It's all about mobilizing the 'People Helping People' philosophy," Michaels said. "It's been a part of the unofficial credit union credo for decades and falls within our goal of making Kansas City a happier place to live and work."
 
In the past few years, Mazuma has teamed up to help several local organizations, including the Urban League of Greater Kansas City, Children's Miracle Network, Habitat for Humanity, The Kingswood Foundation, Spofford Home and the Good Samaritan Project.  The credit union has received several awards for its efforts, including first place for the 2012 Missouri Credit Union Association (MCUA) Desjardins Financial Education Award in the Youth Category.

Social responsibility projects like these help show the value of credit unions to their members and communities. Building awareness of the value of credit unions is part of the Unite for Good campaign, the Credit Union National Association's and state leagues' campaign to work toward the strategic goal where Americans choose credit unions as their best financial partner.

New: CUNA Stats: August CU Loans, Membership and Savings Up

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MADISON, Wis. (10/1/13 UPDATED 11:20 a.m. CT)--Credit union loans, membership and savings all went up in August, according to the August monthly sample of credit unions by the Credit Union National Association.
 
Credit union loans outstanding grew 1.1% in August, led by adjustable-rate mortgages (1.9%), unsecured personal loans (1.8%), new-auto loans (1.5%), used-auto loans (1.3%), fixed-rate first mortgages (1%) and credit card loans (1%). Other mortgages and home equity loans each declined 0.2%.  
 
Credit union savings balances grew 0.9%, compared with a 0.5% decrease in July. The increase is a reflection of three paydays during August with the last payday landing on the last day of the month, CUNA said. Share drafts (6.9%), money market accounts (0.5%), and regular shares (0.1%) also grew during the period. On the decline were one-year certificates (0.3%) and individual retirement accounts (0.1%).
 
Total credit union membership grew 0.4% during August and now totals 98.3 million.
 
The movement's overall capital-to-asset ratio remained at 10.2%. The total dollar amount of capital is $110 billion.
 
Credit unions' 60-plus-day delinquency rate has remained at 1% for the past six months.
 
With loan growth outpacing savings growth during August, the loan-to-savings ratio increased from 68.9% in July to 69% in August. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--is 17.8%.

MnCUN Launches 'Don't Tax My CU' Phone Blitz

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ST. PAUL, Minn. (10/1/13)--The Minnesota Credit Union Network (MnCUN) held a "Don't Tax My Credit Union Phone Blitz" on Thursday. The event was designed to build additional momentum for the Don't Tax My Credit Union campaign.
 
To prepare for the blitz, MnCUN contacted all Minnesota credit unions and urged them to have a designated phone for employees and members to call from, or to have employees make calls from their personal desk extensions to members of Congress throughout the day. Minnesota credit unions used the Credit Union National Association dedicated phone number to make the connections.
 
"It was a fresh, new way for us to keep credit union employees and members engaged and connected with their members of Congress on this critical issue," said Mara Humphrey, MnCUN vice president of public affairs. "The phone effort was an incredibly effective, personal appeal that reinforced all of the other advocacy efforts we're leading to protect the credit union tax status."
 
Minnesota's 10 congressional offices, including both U.S. senators and eight members of the U.S. House of Representatives, received nearly 800 calls during the blitz--nearly three times as many phone calls as were generated in the three months prior to Sept. 26. The call total adds to the more than 16,000 e-mails, postcards and letters already generated through the campaign by Minnesota credit unions.
 
Removing barriers and raising awareness about the value of credit unions to members and communities  are among the tenants supporting CUNA's and the leagues' Unite for Good campaign to rally credit unions toward the strategic vision where Americans choose credit unions as their best financial partner.
 
League communicators are also rallying around CUNA's Don't Tax My Credit Union initiative, with many planning to participate in a virtual rally Wednesday to urge members of Congress to keep credit unions' tax status. 
 
CUNA is expecting tens of thousands of supporters to be in virtual attendance for the rally, and an accompanying physical rally at Credit Union House in Washington, D.C., between 2 p.m. and 3 p.m. (ET). The credit union house event will be live streamed at www.DontTaxMyCreditUnion.org.

SECU, Diebold Partnership Focuses On Jobs

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GREENSBORO, N.C. (10/1/13)--Officials from State Employees' CU (SECU) in Raleigh, N.C., and Diebold Inc. met Friday at Diebold's Greensboro plant to speak about North Carolina jobs.
 
Click to view larger image Officials from State Employees' CU in Raleigh, N.C., and Diebold Inc. met Friday at Diebold's Greensboro plant to speak about North Carolina jobs. (Photo provided by State Employees' CU)
Diebold is a CUNA Strategic Services provider.
 
Earlier this year, SECU contracted with Diebold to upgrade its network of 1,100 CashPoints no-surcharge ATMs, all of which are located in North Carolina and assembled in the Greensboro facility. For SECU, the partnership was advantageous for many reasons: Diebold is a leader with technology and service, and equally as important, the company has a base in SECU's home state, the $25.1 billion asset credit union said. With the assembly for SECU's ATMs handled in Greensboro, North Carolina's work force and the local economy benefits, SECU said.
 
"Our focus is North Carolina and its citizens--it's where we live and work and who we serve," noted SECU President Jim Blaine. "It only makes sense for SECU to do business with folks who operate in our state. Diebold employs approximately 150 North Carolinians in Greensboro, a place where we also have 10 credit union branches and thousands of members, some of whom are part of the Diebold family. Our contract will help sustain those jobs and any win for North Carolina is a win for SECU."
 
"We established our Greensboro, N.C., facility about five years ago with approximately 10 employees," said Andy W. Mattes, Diebold president/CEO. "Today, Diebold Greensboro is a full-production facility, shipping products internationally to Canada, Mexico and Latin America--and is a core component of our global supply chain and manufacturing process.
 
"One hundred percent of SECU's Diebold ATM order was built in some capacity here at the Greensboro facility," he added. "For a global company with a presence in more than 90 countries, that's a very unique scenario. Our partnership with SECU is very important to us. For a combined 100 years, Diebold and SECU have been committed to the state of North Carolina and continuously strive to make a difference within the communities we work and live."

Alloya Corporate Announces Re-election Of Board Members

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WARRENVILLE, Ill. (10/1/13)--Alloya Corporate FCU in Warrenville, Ill., Monday formally announced the re-election of six board members during the board's annual meeting on Sept. 12.
 
  Re-elected to three-year terms were:
  • Chair--Amy Sink, senior vice president and chief financial officer, Teachers CU, South Bend, Ind.;
  • Robin Frucci, CEO, LAFCU, Lansing. Mich.; and
  • Floyd Rummel III, executive vice president and interim CEO, Northern Hills FCU, Sturgis, S.D.
Also, board members who were re-elected to two-year terms were Cheryl DeBoer, president/CEO, First Community FCU, Parchment, Mich., and Pete Gates, CEO, Michigan Schools and Government CU, Clinton Township, Mich.
 
Patrick White, general manager, Flint (Mich.) Area School Employees CU, was re-elected to serve for one year.
 
Other returning board members include:
  • Vice chair--John Fiore, president/CEO , Motorola Employees CU, Schaumburg, Ill.;
  • Treasurer--Leanne McGuinness, senior vice president and chief financial officer, The Summit FCU, Rochester, N.Y.;
  • Secretary--Curt Cecala, CEO, TCT FCU, Ballston Spa, N.Y.;
  • Daniel Stoltz, president/CEO, SPIRE FCU, Falcon Heights, Minn. and
  • David Suvall, president/CEO,  Rhode Island CU, Providence, R.I.
Alloya's Supervisory Committee for 2013-2014 includes: Chair--Charles H. Rogers, chief operating officer, Progressive CU, New York City; Michael Daugherty, president and manager, Community Plus FCU, Rantoul, Ill.; and Bernard Williams, CEO, Wanigas CU, Saginaw, Mich.

Three CU Partnerships With Nonprofits Awarded $530K

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CHICAGO (10/1/13)--The National Federation of Community Development Credit Unions and the Center for Financial Services Innovation (CFSI) Thursday awarded $530,000 to three partnerships between credit unions and nonprofit organizations through the Financial Capability Partnership Initiative (FCPI).

"These partnerships will connect credit union products to the families and individuals who need them most, those who are traditionally hardest to serve," said Cathie Mahon, federation president/CEO. "This kind of innovative work is critical as we promote increased access to safe and affordable products and services in low- and moderate-income communities."

During the next three years, each partnership will integrate credit union products into social service delivery with the goal of fostering greater financial capability and independence for low-income and underserved consumers. Through the initiative, the federation also is depositing $1.5 million in credit unions to support partnerships and lending in underserved markets.

The initiative is managed by the federation, working with CFSI. Support for FCPI is provided by the Kresge Foundation.

In Phase I of FCPI, the federation and CFSI delivered tailored technical assistance to 10 nonprofit-credit union partnerships in seven target cities: Chicago; Cleveland; Durham, N.C.; New Orleans; San Antonio; the San Francisco Bay area; and St. Louis.

Also, a program-related investment from the Kresge Foundation has allowed the federation to deploy $1.5 million in deposits with participating credit unions in the seven communities. Three partnerships were selected from this group to receive grant funding for Phase II of the initiative.

The FCPI grantees are:
  • Mission SF (with Year Up Bay Area) and Self-Help FCU (San Francisco branch)--Integrating financial coaching programs and credit union products with award-winning work force development programs for low-income youth ages 18-24 in San Francisco.
  • The Community Builders and South Side Community FCU in Chicago--Engaging and supporting income-earning residents of a Work First Community Housing property with direct financial coaching and access to responsible financial products in Chicago.
  • Kingdom House and St. Louis Community CU--Further integrating credit union products with social services, focusing on debt reduction, asset building, and youth financial education in St. Louis.
The three selected partnerships also will receive technical assistance from the federation and CFSI on partnership design, and product and service delivery. A Learning Network also will be established to provide the Phase I and Phase II partnerships with peer-learning opportunities designed to strengthen their capacity and efficiency in delivering solutions that promote financial capability. During the pilot period, CFSI and the federation also will work with the grantees to document the experience of the partnerships and the impact of each program.

Georgians Targeted In Fake Check Scheme

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MACON, Ga. (10/1/13)--Members of MidSouth Community FCU, Macon, Ga., have recently been targeted in a $50,000 counterfeit check scam that could be spreading through the Southeastern U.S.
 
Baldwin County Sheriff's investigators have handled about a dozen cases related to the scheme in the past three weeks (Macon Telegraph Sept. 27).
 
MidSouth CEO/President Roy Bibb told the Macon Telegraph he doubts his credit union is the only financial institution targeted in the scam.
 
All counterfeit checks were traced back to an identity theft victim who has been cleared of any wrong doing.
 
In the scheme, fraudsters obtain account numbers and print counterfeit checks. Fraudsters use checks to purchase merchandise at big box stores such as Wal-Mart and and Lowe's, then return the merchandise for cash or selling the goods.
 
Authorities have released a surveillance photo of the prime suspect.
 
Bibb advised credit union members to carefully monitor their accounts.

CU System Briefs (10/01/2013)

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  • SCOTTSBURG, Ind. (10/1/13)--A former branch manager at Centra CU, Columbus, Ind., was arrested Friday and accused of stealing more than $63,000. Renea D. White, 24, was charged with five felony counts of defrauding a financial institution and five felony counts of theft (The Courier-Journal Sept. 27). White allegedly stole the cash in a number of different ways, including taking cash from the teller drawer and manipulating member accounts. The thefts took place from Jan. 2, 2012, through Jan. 8, 2013. State police conducted a seven-month investigation that led to the charges. The credit union reimbursed affected members' accounts ...

Topline FCU Reaches 1,350 Students Through Fin. Ed.

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MAPLE GROVE, Minn. (10/1/13)--Minnesota credit unions reached more than 4,400 students during the 2012-2013 school year, according to The National Youth Involvement Board. TopLine FCU, with $340 million in assets, contributed to that total by reaching over 1,350 of those students through more than 30 financial literacy presentations its staff delivered to students across the Twin Cities during the past school year.
 
TopLine reaches students through local educational programs such Hennepin Technical College's Gaining Early Awareness and Readiness for Undergraduate Programs, helping middle school students prepare for post-secondary education,  and the Minnesota Council on Economic Education's Personal Finance Summer Institute for College Readiness, which reaches out to area high school students.
 
TopLine also leads personal money management educational sessions each October at the Minnesota State College Student Association's Annual Leadership Summit, and it runs quarterly free community classes at its own TopLine Maple Grove Learning Center.
 
Members and nonmembers can attend TopLine's Get Smart with Your Money program, which offers three age-specific classes, each offered four times a year, at its Maple Grove location. Building Dreams explores the concepts of spending, saving and sharing for children ages 5 to 8. Dollar Power explores the concepts of needs vs. wants, and planning and spending wisely, for ages 9 to 13. Dollars & Sense explores sound money management, including using credit wisely and identity theft prevention, for ages 14 to 18.
 
Raising awareness about the value credit unions provide their members and communities,  removing barriers and fostering service excellence  are the foundation for the Credit Union National Association's, state credit union leagues' and credit unions' Unite For Good campaign toward a vision in which Americans choose credit unions as their best financial provider.