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FIs struggle to reconcile sales culture self-service

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NEEDHAM, Mass. (11/16/09)--Retail financial institutions are struggling to reconcile their self-service, multichannel world with their sales culture, according to a new study from TowerGroup. Self-service channels in retail financial institutions have exploded since 2005, with an impact on the roles and responsibilities of staff on the front lines--those who face customer-members, said the Needham, Mass.-based financial services research and consulting firm. In "The Sales Culture in Retail Banking: Getting to Sales 2.0 in the Self-Service Era," Kathleen Khirallah of TowerGroup's retail banking division evaluates the efficacy of retail banks' sales capabilities during a time of continued rapid transition to self-service channels. Among the findings:
* The new era of sales culture--dubbed Sales 2.0--balances sales and service priorities with a focus on fulfilling member/customer expectations for the customer experience; * Sales 2.0 demands a cross-functional management approach that recognizes that sales and service priorities are enterprise issues and that executives throughout the financial institution are responsible for its success; * The explosion in the number of transactions occurring in the self-service channels is forcing financial institutions to readdress the limitations of their existing sales culture; * The sales culture of the vast majority of banks has two major flaws: focusing on sales rather than service, and being limited to interactions that take place in the contact center and the branches; * Consumers continue to demand channel integration policies that facilitate moving among channels for complex sales and service transactions; and * Financial institutions that have started the process of adapting Sales 2.0 are acknowledged leaders in customer/member experience management.

Invest in America adds FDT florists CU Benefits

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LIVONIA, Mich. (11/16/09)--Credit unions' incentive program with auto dealers, Invest in America, has added two more alliances providing discounts to members: FTD Florists for flowers and gift packages, and CU Benefits Express for medical and lifestyle benefits packages. Credit union members will get a 20% discount on FTD flowers and gift packages with a seven-day satisfaction guarantee. The program will run through Oct. 31, 2010. CU Benefits Express--through a partnership with Credit Union Resources, an affiliate of the Texas Credit Union League--offers credit union members discounts on a variety of services in medical benefits and lifestyle benefits packages--each for around $12 a month. Each package includes more than a dozen free or discounted programs such as LifeLock identity theft services, TelaDoc 24/7 phone access to doctors, and discounts on everything from chiropractors to restaurants to pet care. Some programs purchased on their own would cost as much as an entire CU Benefits Express package. "There has never been a better time to be a member of a credit union. The new Invest in America offers from American companies resonate with credit union members," said David Adams, CUcorp CEO and Michigan Credit Union League president/CEO. He noted the new additions significantly expand the scope of the products offered by credit unions. Also in November, Invest in America announced its Chrysler "Affiliate Rewards" program, where credit union members receive preferred pricing through the end of November. To date more than 2,000 credit unions market the program, with more than 200,000 General Motor and Chrysler vehicles sold. New partners are added every month. Invest in America also is offering discounts with Chrysler, GM, Sprint, Thor Industries, and Allied Moving and Storage. For more information use the link.

Wisconsin league president elected AACUL chairman

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NAPLES, Fla. (11/16/09)--The American Association of Credit Union Leagues (AACUL) elected its executive board and officers during its annual meeting held Thursday through Saturday in Naples, Fla. They are:
* Chairman, Brett Thompson, president/CEO of the Wisconsin Credit Union League; * First vice chairman, Bill Mellin, president/CEO of the Credit Union Association of New York; * Second vice chairman, Wendell Lyons, president/CEO of the Kentucky Credit Union League; * Treasurer, Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues; and * Secretary, Tracie Kenyon, president/CEO of the Montana Credit Union Network.
Thompson, formerly the first vice chairman of ACCUL, said of his election, "Leagues and credit unions have a full plate of challenges and opportunities--economic, legislative and regulatory among them. I look forward to addressing them as AACUL chair. "Our goal, as always, is to work collaboratively to best position leagues as a powerful and innovative resource and advocate for our member CUs." Also serving on the board in ex-officio capacity are Rosie Holub, immediate past chairman and president/CEO of the Missouri Credit Union Association, and Susan Newton, executive director of AACUL. For more coverage of the ACCUL meeting, see "Matz to AACUL: NCUA to help CUs manage higher risk" and other stories in News Now's Washington section.

Rutgers University-based CUs discuss merger

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NEW BRUNSWICK, N.J. (11/16/09)--Two credit unions that serve the Rutgers University campus are discussing a possible merger. A merger between University Student and Alumni FCU and Rutgers FCU would provide “tremendous economies [of scale],” Rutgers FCU CEO Howard Elkin told News Now. Rutgers FCU has $71 million in assets and Rutgers University Student and Alumni FCU has $3 million in assets. The credit unions are located within three blocks of each other on campus, but serve different memberships. Rutgers University Student and Alumni FCU serves students and alumni of Rutgers. Rutgers FCU serves faculty. Combining the two “makes sense,” Elkin said. The Daily Targum, Rutgers’ student newspaper, reported Thursday that an employee and member of Rutgers University Student and Alumni FCU had filed a lawsuit against the student credit union’s board of directors, which had voted and agreed to propose a merger with Rutgers FCU. The merger would not have students’ interest in mind, the newspaper said. Rutgers FCU said it is open to discussing a merger despite the lawsuit. “We’re still willing to merge when [Rutgers University Student and Alumni FCU] resolve their issues,” Elkin said. University Student and Alumni FCU had not responded to News Now’s request for information by press time.

U.K. CUs authority broadens to address global issues

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BIRMINGHAM, England (11/16/09)--Credit unions throughout the United Kingdom are being granted additional capabilities by the country’s Parliament to serve more members left underserved by banks during the global financial crisis. Credit unions’ didn’t contribute to the crisis, which is driving the new opportunities--a recognition other countries, including the U.S, would do well to acknowledge--said executives from the World Council of Credit Unions (WOCCU) and the Credit Union National Association (CUNA). “The U.K.’s banking system has been decimated to an even greater degree than that of the U.S., but the country's credit unions have grown in terms of assets and members served,” said Dave Grace, WOCCU vice president of association services, at the Association of British Credit Unions Ltd. (ABCUL) fall meeting earlier this month. “Lawmakers have realized this and are expanding financial cooperatives' powers for the first time in 30 years,” he added. “That recognition is something from which credit unions in other countries, including the U.S., could benefit.” The Financial Services Authority (FSA), U.K.’s regulatory body, has taken steps to broaden financial cooperatives' abilities in recognition of the relatively stable position financial cooperatives have held even during the worst days of the crisis, Grace said. Under proposed regulations, credit unions would be able to serve more consumers, issue interest-bearing shares and gain access to alternative capital. Lawmakers also are increasing capital and liquidity requirements for the country’s 500 credit unions to help avoid future financial industry problems and provide greater protection for consumers. As part of the changes, the proposed regulations will raise the level of governance standards, increase minimum liquidity requirements for all credit unions and raise capital-to-asset ratios for smaller institutions. The proposal is out for comment until Feb. 10, with plans to enact the new rules during next year’s second quarter. The new regulations will be phased in over a two- to three-year period. Credit union stability in the U.K. has mirrored that of U.S. credit unions during the past year. Unlike banks, credit unions have not solicited nor received government bailout funds. However, U.S. credit unions already have significantly greater authority than those in the U.K. and would not benefit as greatly by broadened service capabilities, according to Mike Schenk, CUNA vice president of economics and statistics. “There are some fairly substantial differences between the credit union systems in the U.S. and U.K.,” said Schenk, who shared a panel with Grace during the conference convened by ABCUL, WOCCU's member organization in the U.K. “We already have authority to do things that they don't and, since our credit unions are bigger, they tend to exercise that authority.” U.S. policymakers have been increasingly open to efforts to amend restrictions on credit union member business lending, Schenk explained. CUNA conservatively estimates that removing the decade-old limit would lead to an additional $10 billion in business loans in the first year if the authority were expanded. The resulting boost could generate 108,000 new jobs. The link between expanded authority and job creation is critical in the current economic environment, he noted. Schenk agreed that U.S. credit unions deserve greater recognition for not contributing directly to the global recession, even as they struggle to deal with the fallout from competitors’ errors in judgment. Public recognition, rather than increased opportunity, could be more beneficial in helping U.S. credit unions avoid punitive regulations as the industry emerges from the crisis, he added. “For the most part, we’re playing a defensive position,” Schenk said. “However, the window of opportunity isn't opened quite as wide for credit unions in the U.S. as it is in the U.K.”

Vermont league moves checkcard promo to after holidays

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SOUTH BURLINGTON, Vt. (11/16/09)--The Association of Vermont Credit Unions (AVCU) has decided to move this year’s CU Checkcard program promotion away to six weeks after the holidays. Transaction volume is typically high during the holidays. AVCU hopes the move will assist credit unions by improving interchange revenue during a traditionally slow period. For the past few years, the program has sponsored a holiday giveaway promotion featuring a grand prize package worth more than $2,500. With a recurring theme of the “Family Land” game board, a takeoff on a popular children’s board game, the holiday promotion has drawn participation from nearly all AVCU member credit unions offering the CU CheckCard to members, the association said (Newslines Express Nov. 6). Each credit union agrees to award a weekly prize of at least $25 in value for the six-week promotion, which gives members a chance to win the grand prize. AVCU’s 2010 Family Land--Winter Vacation Edition promotion will run from Jan. 1 through Feb. 11. The grand prize package includes $2,010 in cash, plus four Vermont prizes:
* A full day of cross country skiing or snowshoeing, including trail fees and equipment rental; * A handcrafted Vermont-made wooden toboggan; * A gift basket of Vermont breakfast favorites including Green Mountain Coffee, Lake Champlain Chocolates Cocoa, and Dakin Farm buttermilk pancake mix, cob smoked bacon, maple syrup and preserves; and * A $50 convenience store cash card for gas or other purchases.

California columnist CUs looking better and better

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SAN JOSE, Calif. (11/16/09)--Credit unions today are available to everyone and many pay higher interest rates on deposits than banks, said a California newspaper columnist. In the past a credit union was viewed as a “small, hidden-away office, closed to the general public” but credit unions today have “opened their doors to everyone, and offer the same services as banks and savings and loans,” wrote Cliff Pletschet, financial columnist in a Friday column for The Mercury News in San Jose, Calif. While some consumers may believe that the differences in what credit unions pay in higher rates may be too insignificant to make changes in where they bank, there is another reason, Pletschet added. Credit unions are much stronger and better run than most banks and when the economy recovers, their interest rates are likely to rise faster and higher than those paid by banks, William Cheney, CEO of the California Credit Union League, told Pletschet. Pletschet quoted an official at a local credit union about another key advantage of credit unions--low fees. “One of the things that we have found in our research is that people are very frustrated with the fine-print fees they pay at other financial institutions, so we have designed our accounts to eliminate as many of those fees as possible,” Kristin Dove, vice president of marketing at Pacific Service CU, Walnut Creek, Calif., told the newspaper. “As a not-for-profit financial institution, our first priority is to create products that are consumer-friendly, not profit-friendly, so we have created ways for people to pay no or low fees.” Consumers should check out the nearest credit union to examine all the advantages it offers, including better rates on deposits, Pletschet concluded. To read the article, use the link.

Texas leagues top marketing awards go to Neches FCU

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FARMERS BRANCH, Texas (11/16/09)--The Texas Credit Union League honored Neches FCU with two top marketing awards at the league’s 22nd Annual Credit Union Marketing and Business Development Conference in Galveston. Neches FCU, Port Neches, Texas, received the People’s Choice Award and Best of Show Award under the Youth/Senior Marketing category for the same entry. The credit union was honored for developing nSpire, which uses social networking sites such as Facebook and Twitter and podcasting to promote the credit union difference. The credit union was also cited for events it offered to connect with members and potential members (LoneStar Leaguer Nov. 13). The league presented hundreds of awards in the 14th annual Lone Star Awards program. Entries were judged on results, creativity and the effectiveness of information and education provided. The awards drew 255 entries from 64 credit unions statewide, the league said. For a list of award winners, use the link.

PCUA Pacul employees step up to fitness challenge

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HARRISBURG, Pa. (11/16/09)--During a 12-week, 10,000-step walking program, 39 employees of the Pennsylvania Credit Union Association (PCUA) walked millions of steps, which equaled thousands of miles. For a little rivalry, the PCUA building competed against employees in the Pacul Services Inc. (PSI) building (Life is a Highway Nov. 13). The PSI building employees won with 14,232,172 steps. With roughly 2,000 steps in a mile, they could have walked from Augusta, Maine, to San Diego (3,270 miles) and back. The PCUA group walked 10,388,809 steps, equivalent to a roundtrip walk from Augusta, Maine, to El Paso, Texas (2,630 one way). The daily average was 7,516 steps or 3.8 miles; and weekly--52,609 steps, 26.6 miles. The 12-week overall average was 631,307 steps for 318.8 miles, which would be a little farther than Philadelphia to Pittsburgh (614,000 steps for 310 miles). The goal of the program was to increase individual physical activity, and eventually reach 10,000 steps per day, PCUA said.

CU System briefs (11/13/2009)

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* WARMINSTER, Pa. (11/16/09)--Freedom CU and University House FCU merged on Oct. 26, announced Freedom, a $390 million asset credit union based in Warminster, Pa. University House FCU had 35 members and $80,000 in deposits, with shares that were exclusively savings. "Freedom is happy to step in and help University House," said Lee T. MacMinn, Freedom's president/CEO, in welcoming the new members. "The merger has allowed us to not only offer help to University House members, but to also show our support for the credit union movement as a whole," he said. Freedom has more than 55,000 members and operates branches in Philadelphia, Warminster, and Lansdale, Pa. … * MINNEAPOLIS-ST. PAUL (11/16/09)--Spire FCU announced Thursday the resignation of President/CEO John Gisler on Oct. 27 to pursue other opportunities. Dan Stoltz, executive vice president and chief financial officer of the $606 million asset, Falcon Heights, Minn.-based credit union, has been named interim CEO. Gisler was with Spire for 22 years, 20 of them as president/CEO. The credit union changed its name in 2008 from Twin City Co-ops FCU (Minneapolis-St. Paul Business Journal Nov. 13) … * CEDAR RAPIDS, Iowa (11/16/09)--An off-duty uniformed police officer hired by Collins Community CU as security thwarted a robbery at the credit union Thursday. The officer was inside when two men wearing bandannas tried to enter. One held a handgun, the officerd told police in Cedar Rapids, Iowa. They saw him and immediately turned and ran. The officer chased them and called for backup. The two were still at large Friday. The incident occurred less than 24 hours after another credit union in the city was robbed (KCRG-TV9 Nov. 13) … * RALEIGH, N.C. (11/16/09)--A groundbreaking ceremony was held at SECU House--the new wing at Kitty Askins Hospice Center, Goldsboro, N.C.-- to mark the center's expansion to 24 beds from 12. State Employees' CU members, through the SECU Foundation, provided a $750,000 grant to Home Health and Hospice Care Inc. (3HC) for the expansion. Pictured are, from left: Mark Twisdale, SECU Foundation executive director; Dean Lee, 3HC president; Donna Oldham, SECU vice president of Goldsboro-West Ash St. branch; Shirley Bell, chairman of the SECU Foundation Board; Bo Wessell, member, SECU Advisory Board; and Miriam Wessell, 3HC Advisory Development Board member. (Photo provided by SECU Foundation) … * DES MOINES, Iowa (11/16/09)--Affiliates Management Co. (AMC), a wholly owned holding company subsidiary of the Iowa Credit Union League, has raised more than $20,260 for United Way during its 2009
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annual fundraising campaign, setting a company record. AMC was formed to integrate and align the league's operating companies, including The Members Group (TMG), TMG Financial services, Community Business Lenders, PolicyWorks and Coopera Consulting. Pat Jury, league president and chairman of AMC, noted that 200 employees participated. They raised money through pledges and fundraisers such as this pie-eating contest. From left are Kelly Wadsworth of AMC, Warren Morrow of Coopera Consulting, Mike Powers of AMC, Todd Herren of TMG, Murray Williams of the league, and Mark Kilian of Community Business Lenders. (Photo provided by Iowa Credit Union League) … * BURNSVILLE, Minn. (11/16/09)--US FCU employees raised more than $20,691with department competitions during October for the Combined Federal Campaign (CFC) in October. The newest event: voting for one of the credit union's seven executive management team members whom they would like to see kiss a live goat, provided by a member. Winners were Marty Kelly, senior vice president of marketing and business development, and Leon Eichten, senior vice president and chief financial officer. Although only two had to kiss the goat, others volunteered to do the same, including Cheryl Reed, vice president branch member service; Sue Peters, vice president accounting; Eileen Marcus, assistant vice president and director of Member Service Center; and even Bill Raker, president/CEO. Raker is shown here taking the smooch with "Supergoat." Of the amount raised, more than $14,815 went to the credit union's designated charity, the Children's Miracle Network, while the rest went to charities designated by the donors. (Photo provided by US FCU) …