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Javelin Consumers heads in the sand on personal finance

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SAN FRANCISCO (11/17/10)--Although the "Great Recession" has caused belting tightening among millions of Americans, millions of others are monitoring their finances less than they did a year ago, says new research from Javelin Strategy & Research. Nearly one in five (19%) of consumers currently do not monitor or manage their personal finances. That's more than double the 8% who didn't manage their finances last year, said the San Francisco-based firm's report, "Personal Finance Management (Part 1): What Consumers Really Want from PFM," which was released Monday. "The prolonged economic downturn has made money tight in millions of American households and caused the rise of a nation of 'cautious consumers,'" said James Van Dyke, president/founder of Javelin. "But contrary to what many may think, millions of consumers are monitoring their finances less--not more," he said. "What you can't see can hurt you, and Americans need to pull their heads out of the sand." Personal finance tools "can help consumers regain control and confidence in challenging economic times," said the report. More than half of U.S. households maintain financial accounts at more than one financial institution, making management "a complex and often tedious chore when they seek to assess their current financial status. With increased financial products options and technology channels, personal finance management has never been more complex," the report added. It noted that banks and credit unions are in the best position to give consumers control over their finances by integrating PFM tools on the Web. Other key findings:
* The percentage of consumers who say they sometimes manage their finances by logging on to checking account balances slipped--to 46% in 2010 from 59% in 2009. * Online banking suffered as many consumers switched back to paper and pen to track their finances. * Consumers say their No. 1 need is to be able to see all their account balances and transactions in one place.
"Consumers want to be able to access multiple accounts in one view, in real-time, and on the go," said Mark Schwanhausser, senior analyst, multi-channel financial services. He said financial institutions "must seize this opportunity to redefine online and mobile banking and install PFM at the heart of the user experience so that consumers feel empowered, not overwhelmed, when it comes to managing their finances."

Despite economy Wisconsins big CUs have no losses

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PEWAUKEE, Wis. (11/17/10)--Although most of Wisconsin’s large credit unions saw their earnings dip during the first three quarters of 2010, none of them has lost money, according to the latest data from the National Credit Union Administration (NCUA). Seven of the 10 biggest state-chartered credit unions had lower net income in the first nine months of 2010, said NCUA (Milwaukee Journal Sentinel Nov. 15). Only Summit CU in Madison, Community First CU in Appleton, and Royal CU in Eau Claire saw increased net income in the first three quarters of the year, the newspaper said. "There's no doubt financial institutions of all kinds face more difficulty now in sustaining earnings," Brett Thompson, president/CEO of the Wisconsin Credit Union League, told News Now. "However, credit unions have clearly done what it takes to manage their bottom line while at the same time helping their member-owners weather the financial challenges they're facing. Credit unions' real success has been in how well they've done that for members. And in these economic times, members have discovered their credit unions were there when they needed them." Most of the state’s big credit unions increased their reserve allocations to account for any potential bad debt--an action that diminishes the net income for financial institutions, the paper said. “It’s the economy,” Suzanne Cowan, director of Wisconsin’s Office of Credit Unions, told the paper, adding “rates are so low [that] there’s not a lot of interest-rate margins, so that reduces the interest income that the credit unions earn.” Also, credit unions have to pay premiums this year to the NCUA’s National Credit Union Share Insurance Fund, which insures credit unions if they fail, the paper said. In light of the struggling economy and low interest rates, “credit unions have done pretty well,” Cowan told the paper.

Filene study Adapt services to retain young adults

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MADISON, Wis. (11/17/10)--Attracting more Gen Y members is more than a marketing strategy for credit unions, it’s a matter of survival, according to a just-published report from the Filene Research Institute. While older consumers continue to be loyal to credit unions and small banks, by 2020 Gen Y will dominate the work force, comprising 40% of all workers--virtually all of them with borrowing needs, according to the 1,400-response survey, “Big, Small or Online? Young Adults’ Evolving Financial Presence.” Among the survey findings:
* 22% of Gen Y use an online bank as their primary financial institution; * 40% say a recommendation from friends or family played a role in their opening an account; * Gen Y places a premium on account features and interest rates--in the immediate term; and * Online bank customers say they have the best combination of the features and fees and that online services suits them best. The strength of this sentiment shows that “personal” service really means “suitable” service, said Filene. In the case of Gen Y, that service is often offered online.
Study author Rob Rubin, founder and CEO of Facilitas--the organization behind and BankSwitcher--said that the key to remaining viable in the long-term is to make Gen Y their No. 1 focus. The best way to do that is to make your online presence a priority. “Take honest stock of the competition from online banks and big banks alike,” Rubin said. “Only then can you double down on the services that will make your financial institutions the one of choice among Gen Y.” To read the study, use the link.

Unitus use of iPads to sign up accounts catches on

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PORTLAND, Ore. (11/17/10)--Unitus Community Credit Union, Portland, Ore., is using the Apple’s iPad to sign up new members--and the idea is also attracting attention from credit unions throughout the country.
Click to view larger image Brett Wooden, business development manager at Unitus Community CU, has used the Apple iPad to sign up new members. The award-winning idea has attracted interest from credit unions nationwide. (Photo provided by Unitus Community CU)
Brett Wooden, the $830 million-asset credit union’s business development manager, came upon the idea when he used his iPad in a meeting with a business member who didn’t have time to visit a branch. The iPad offered seamless access to the Unitus Community CU website and its personal financial management tools. Wooden said he thought so much of the iPad as a member service tool that he entered the idea in the REAL Solutions competition sponsored by the Credit Union Association of Oregon. The idea won the competition, and Wooden has since received e-mails and calls nationwide asking for more information about how to effectively serve members with the iPad. Most of the calls are from information technology (IT) managers who want to know how to integrate the iPad with their core systems and business development people interested in learning how to implement the device in the field, Wooden told News Now. The Unitus Community CU iPad is linked with its online member application, Wooden said. As for advice to those looking to take the iPad into the field, he points out it’s a good idea to move to a paperless marketing environment. “If you show up with paper brochures and rate sheets along with your iPad, it takes away from the cutting-edge feel of it,” he said.

CU System briefs (11/16/2010)

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* ST. LOUIS (11/17/10)--A suspect in an $11 million heist of ATM Solutions, an ATM-servicing business for banks and credit unions in several Midwestern states, is one of two men who have escaped from an eastern Missouri jail. John Wesley Jones, 36, is suspected of being one of four who ambushed security guards arriving for work in the Aug. 2 robbery but not officially charged with the robbery. Jones and Corey Durand Cross escaped around 3:30 a.m. Monday by climbing to the jail's roof before scaling down a 30-foot wall. Both men were in jail on weapons charges (Kansas City Star Nov. 16). Jones was arrested a day after the robbery with hundreds of thousands of dollars in the trunk of his car (River Front Times Nov. 15). The men are considered armed and dangerous, said authorities … * MADISON, Wis. (11/17/10)--Ron Jooss is the new assistant Web editor at the Credit Union National Association's News Now, effective Monday. Jooss previously served as an editor at the Credit Union Executives Society (CUES), Madison, Wis., where his duties primarily focused on Credit Union Management magazine as well as CUES’ online publications. At News Now, Jooss will cover credit union system news, products and services and Inside Washington as well as CUNA's Governmental Affairs Conference … * FARMERS BRANCH, Texas (11/17/10)--The Texas Credit Union Foundation raised more than 87,800 at its 13th annual golf tournament to support its financial literacy programs and grants for community outreach, chapter programs and development education (LoneStar Leaguer Nov. 16). The next tournament will be Sept. 7, 2011. The full listing of sponsors is at the foundation's website … * KINGSTON, N.Y. (11/17/10)-- Mid-Hudson Valley FCU President/CEO William Spearman has been appointed by New York Gov. David Paterson to the Board of Trustees for Ulster County Community College (SUNY Ulster) ( Nov. 16). Spearman was chairman and treasurer of the College Foundation board. Mid-Hudson Valley FCU is a $698 million asset credit union based in Kingston, N.Y. SUNY Ulster has satellite campuses in Kingston and Highland … * DETROIT (11/17/10)-- Thomas Reinbolt, former president of the board of Detroit Marathon Employees FCU, died Nov. 9, according to the Michigan Credit Union League (Michigan Monitor Nov. 15). The credit union later merged with Downriver Community FCU. Gloria Butler, former CEO at the Marathon credit union, told the league that Reinbolt became the credit union's 1,000th member and was a great leader and humanitarian. He is survived by his wife, six children, 12 grandchildren and one great-grandchild …

MnCUN CEOs article praises financial co-ops

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ST. PAUL, Minn. (11/17/10)--Focusing on credit unions’ cooperative roots, Minnesota Credit Union Network President/CEO Mark D. Cummins praised financial cooperatives in Monday’s Finance & Commerce newspaper, touting the cooperative characteristics that make credit unions unique and beneficial for consumers. Cummins is a regular columnist for the Twin Cities publication. The article, titled “Defining Credit Unions and the Cooperative Model,” defines how cooperatives differ from for-profit businesses. It informs readers of the strength of co-ops in the financial services industry, where more than 92 million consumers are member-owners of nearly 8,200 credit unions throughout the U.S.--including 1.5 million credit union members in Minnesota. “By working cooperatively, credit unions have successfully helped members around the world overcome financial challenges,” Cummins wrote, noting credit unions’ work to serve the underserved. “Credit unions offer financial counseling, provide foreclosure assistance, and make loans to the state’s small businesses, which are essential during this time of economic recovery.” Cummins also touted the credit union difference by noting the industry’s member-owned, democratically controlled structure. He referred to credit unions’ benefits--lower rates on loans, fewer fees, and higher savings rates--to consumers and encouraged readers to find a credit union they are eligible to join. To read the column, use the link.