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CU System Archive

CU System

Members United reports 149.6 million net loss

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WARRENVILLE, Ill. (11/24/09)--Members United Corporate FCU recorded a net loss of $149.6 million for October, according to financial statements released Friday. The Warrenville, Ill.-based corporate recorded a charge of $74.6 million as it fully impaired 100% of its remaining investment in U.S. Central capital shares, and a charge of $77.1 million for additional other-than-temporary impairments (OTTI) on marketable securities. The charge excluded OTTI on Ambac-wrapped investments, which would have amounted to an additional $37.5 million. Members United stated that while Clayton's cash flow projections fully discount Ambac support after Dec. 31, 2010, the corporate elected to not take the additional OTTI at this time. “Members United is in the process of reviewing Clayton's position and also is reviewing regulatory reports that were released on Nov. 18. This review is anticipated to be completed by Dec. 31 in connection with the year end close process,” the corporate said. Members United’s retained earnings as of Sept. 30 are $2.80 million, and its base net income for October is $2.05 million. Membership capital share balance is $292 million, resulting in an estimated depletion percentage of 50.2%. The depletion will be processed on Nov. 30. The corporate also reported that as of Oct. 31:
* Total fair value of assets totaled $8.5 billion; * Cash and cash equivalents and overnight deposits at U.S. Central amounted to $3.2 billion; * Fair value of marketable securities was $3.7 billion; * Loans to members accounted for $0.8 billion; and * Term deposits represented $0.7 billion.
The corporate’s capital ratio is 1.56%, which is below the 5.0% regulatory requirement. The National Credit Union Administration issued an order April 21 allowing corporates to reference their Nov. 30, 2008, capital levels. Members United’s capital level as of Nov. 30, 2008, exceeded the 5.0% requirement at 7.25%.

CU System briefs (11/23/2009)

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* BEAVERTON, Ore. (11/24/09)--The Credit Union Association of Oregon (CUAO) announced its 2009 Credit Union Advocates of the Year. The award is divided into two categories: volunteer and professional. Mark Turnham, president/CEO of NW Priority CU, received the award in the professional category. He has served in a leadership role on his chapter board, chapter president for 15 years, and as a board member for CUAO. He currently serves on the Governmental Affairs Committee. Don Gleason, Northwest Community CU, received the award in the volunteer category. He has attended credit union advocate training, Credit Union Day at the Capitol, and the Credit Union National Association Governmental Affairs Conference in Washington, D.C. CUAO announced the awards at its annual meeting and convention in Salem, Ore. (Photos provided by the Credit Union Association of Oregon) ... * NORTH HIGHLANDS, Calif. (11/24/09)--SAFE CU, North Highlands, Calif., received the Beacon Award from the Richard Myles Foundation, the state foundation for credit unions in California and Nevada. The credit union received the award during the Beacon Awards Gala Reception Nov. 15 in Las Vegas. SAFE CU was honored for its in-school branch program at two local high schools. The Beacon Award recognizes promising or exemplary financial education programs or projects that provide information to the broader credit union community and general public. SAFE CU has $1.4 billion in assets ... * SPOKANE, Wash. (11/24/09)--Ed Southworth, former president of Safeway CU in Spokane, Wash., died Nov. 15 at the age of 86 (The Oregonian Nov. 22). Southworth worked for Safeway Inc. for 40 years. He also was president of the Safeway Companies Employee Association. Safeway CU, which serves employees of Safeway Inc., has $47.6 million in assets ... * GREAT FALLS, Mont. (11/24/09)--1st Liberty CU, Great Falls, Mont., is in its 10th year of Operation Happy Holiday, a project that sends holiday boxes to Montana troops stationed overseas. The project started in 1999 by former President/CEO Stephen Kubrick and has sent about 3,167 boxes and 234,000 cookies to troops (Great Falls Tribune Nov. 20). While many volunteer to bake cookies, gather supplies and pack boxes, the credit union is seeking donations for the content of the boxes. Each box costs about $40. Some of the money is covered by fundraisers. 1st Liberty CU has $125 million in assets ...

Mich. CU gives 100 to 100 people in 100 days

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LIVONIA, Mich. (11/24/09)--Co-op Services CU Friday ended its 100 days of giving away $100 bills to 100 people. The $385.2 million-asset, Livonia, Mich.-based credit union randomly distributed $10,000 in cash to people in roughly a dozen cities in the metropolitan Detroit area (Detroit Free Press Nov. 20). The credit union’s marketing campaign encouraged people who received a $100 bill to give the money back to their communities in some manner, the newspaper said. Some of the givebacks included helping a neighbor, donating clothes or volunteering. The campaign also garnered publicity for Co-op and its more than 52,000 members, the paper said. “We created this army of people trying to do good things for other people,” Greg Wohler, president of Edge Creative Group, an ad agency that worked with Co-op to develop “Project 100,” told the paper. With the end of the giveaway campaign, Co-op is unveiling a new promotion wherein it gives members $100 for opening a checking account if they agree to donate the money to charity, the paper said. To read the article, use the link.

Wegner Dinner ticket registrations open

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WASHINGTON (11/23/09)--Credit union leaders and supporters can now register for the 22nd Annual Herb Wegner Memorial Awards Dinner, presented by the National Credit Union Foundation (NCUF) Feb. 22, during the Credit Union National Association’s 2010 Governmental Affairs Conference (GAC). The ceremony will showcase four of the credit union movement’s highest national honors:
* Lifetime Achievement Award: Dick Heins, retired president/CEO of CUNA Mutual Group in Madison, Wis.; * Individual Achievement Award: Dick Ensweiler, president/CEO of Texas Credit Union League in Farmers Branch, Texas; * Outstanding Program: Biz Kid$, in Seattle, Wash. In its third season, this financial education show is the highest-carried program on American Public Television and is the first series sponsored by America’s Credit Unions; and * Outstanding Organization Award: HarborOne CU, Brockton, Mass.
Seats can be reserved online through a secure page on the NCUF website. Registrants also can download a printable form, complete it off-line, and fax or mail their completed form to NCUF. For the third straight year, the dinner will take place at the Grand Hyatt Washington.

Meriwest CU closes Tucson branches

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TUCSON, Ariz. (11/24/09)--Meriwest CU announced it will close its two Tuscon financial centers Jan. 1, but members will continue to be served through Shared Branching. Meriwest, based in San Jose, Calif., serves members in California and Arizona. The credit union is closing the two Tucson branches--the only two it has in the state--in a move to consolidate its operations. “Prudence dictates that we consolidate some of our operations to better weather this [economic] storm for the membership as a whole,” the credit union said in a statement. Meriwest has no plans to close additional financial centers. “Our capital is strong, our operations are excellent and our expenses are well below peers',” the credit union said. Staff at the Tucson centers will remain until the centers close. The staff will be given support, a compensation package, and Meriwest will contact other credit unions in the area to identify job opportunities or provide references, Meriwest said. Members in the Tucson area will continue to be served by Meriwest through Shared Branching. Meriwest provided a list of credit unions members can visit for Shared Branching services on its website. Members also can conduct ATM transactions through 7-Eleven VCom units in the Tucson area. Meriwest has $1.3 billion in assets. For more information, use the link.

Mass. CU CEO to fin pub CUs important as ever

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SOUTHBRIDGE, Mass. (11/24/09)--Credit unions are as important as they have ever been to U.S. consumers, especially in the current troubled economic environment, a Massachusetts credit union CEO wrote in a column for a local financial publication. “U.S. credit unions are celebrating their centennial year in the midst of gloomy economic times,” Jeffrey Davenport, CEO of Southbridge (Mass.) CU, wrote in the Worcester Business Journal (Nov. 23). “Many Americans are hurting, and folks are apprehensive about their economic prospects. “Credit unions wish this weren’t the case, and they are stepping in to help whenever possible,” he continued. “But the current situation is an important reminder that credit unions themselves were founded from adversity such as this. It is also a reminder of their proud history of putting people before profits to provide access to affordable financial services to all their members.” Credit unions’ cooperative business model and emphasis on public service through adherence to conservative financial practices has allowed them to be a sanctuary for the past 100 years during times of financial crisis, Davenport wrote. “And even in the midst of the current market crisis, credit unions have been repeatedly heralded as an important source of stability in the financial sector,” he added. “Indeed, credit unions remain committed to helping our citizens retrieve the economic power lost during the current crisis and to recover their homes lost because of the mortgage market upheaval. “Not only is this the reason that credit unions exist, it is also what they do best. And it is this proud, 100-year tradition of being part of the solution rather than the problem that credit unions are celebrating today,” Davenport wrote. To view the column, use the link.

Small CUs will provide some wage increases

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MADISON, Wis. (11/24/09)--Although an unprecedented number of small credit unions indicated they would not be providing wage increases for all of their employees in 2009, the majority will provide wage increases for at least some of their employees, according to the Credit Union National Association’s (CUNA) recently released 2009-2010 Small Credit Union Staff Salary Survey.
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More than 40% of credit unions with $1 million to $35 million in assets reported freezing wages for some of their employees--a level not seen in over 25 years during which CUNA has studied credit union compensation and benefits packages. However, 93% of these credit unions said they expected to provide a salary/wage increase to at least some of their employees in 2009. As is the case across industries, wage increases are much lower than previous years, CUNA said. The average 2009 budgeted percentage salary increases for management and non-management employees are 2.6% and 2.7%, respectively. Anticipated 2010 percentage salary increases are lower, at 1.9% for managers and 2.1% for non-managers. However, while small credit unions typically provide wage increases that are lower than larger credit unions, 2009 budgeted wage increases and 2010 projected wage increases among credit unions with under $35 million in assets are comparable to the wage increases of credit unions overall--all credit unions with $1 million or more in assets. “The fact that wage increases for 2009 and 2010 among small credit unions are in line with their larger counterparts shows that these credit unions are working hard to reward their employees amidst a difficult economy and operating environment,” said Beth Soltis, CUNA senior research analyst. “To control payroll costs in 2009 and 2010, employers nationwide are promoting fewer employees, reducing staff, revising variable-pay programs, and implementing salary and hiring freezes,” she added. “The challenge for credit unions is to take the proper action, yet remain competitive in the labor market and retain high-quality employees. It appears that small credit unions are doing just that.” The survey provides nationwide compensation data--including base salaries, incentives, bonuses and total compensation--for 30 full-time positions and eight part-time positions for credit unions with $35 million or less in assets. Results are categorized by asset size, region, and many other points of comparison to help credit unions attract or retain staff. For more information, use the link.