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NEW: Nowacki Is New CU League of Connecticut CEO

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MERIDEN, Conn. (11/5/13, UPDATED 5:33 p.m. ET)--Jill Nowacki is the new president/CEO of the Credit Union League of Connecticut, the league's board of directors announced today.

Nowacki has worked in the credit union system for more than 10 years. "Her multi-dimensional experience in the credit union industry will ensure the league's continued success supporting Connecticut's credit unions from the teller counter to Capitol Hill," the league said in a release.

Nowacki first worked for credit unions in communications and marketing at the Montana Credit Union Network.  Her next position was in Washington, D.C. working for the Credit Union National Association as executive director of Credit Union House. She then went to at Maps CU in Salem, Ore. where she was executive director of Maps Community Foundation.

The new Connecticut league president/CEO noted her commitment to philanthropy and giving as a reason for wanting the position. "I love that I get to be part of an organization with a sole purpose that is essentially helping others be successful. That feels like a perfect fit to me."

She commended the league for its work with reality fairs and its commitment to community outreach and education.

Michael Hinchey, who chaired the search committee, stated, "Our nationwide search led us to a candidate with high energy, exceptional skills and a passion for supporting credit unions and their members. Under her leadership we believe the Connecticut Credit Union League will remain a valuable resource for Connecticut credit unions for many years."

CUs Active In Districts, Meeting With Lawmakers

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MADISON, Wis. (11/5/13)--Credit unions are taking every opportunity to meet with federal and state lawmakers on their home ground to discuss issues such as the tax status, regulatory burden, supplementary capital and more.  And legislators are taking notice.
 
U.S. Rep. Fred Upton (R-Mich.) told credit union leaders at a legislative breakfast in KALSEE CU, Kalamazoo, that he supports credit unions on their key federal issues including government-sponsored enterprise reform, regulatory relief and expanded member business lending. (Photo provided by the Michigan Credit Union League).
For example, before deciding on whether to support a delay in qualified mortgage (QM) rules, U.S. Rep. David Joyce (R-Ohio), a freshman congressman, had his aide check with the Ohio Credit Union League to get the credit union perspective, said the league (eLumination Newsletter Oct. 30).
 
League Director of Public Affairs Patrick Harris voiced credit unions' support for the delay and shared that the new mortgage rules from the Consumer Financial Protection Bureau topped the list of concerns discussed at the league's recent statewide Town Hall dialogues because they add to an already overwhelming regulatory burden, said the league. (See Related News Now article, CUNA: QRM Definition Improves, But Concerns Remain. Use the link.)
 
"The CFPB rules are unclear and massive and the implementation time is much too short," Harris said. "A delay is not only wise, but necessary." To build support for the delay, the league contacted every member of Ohio's congressional delegation to request their support. Several members of Congress from Ohio have signed a letter to CFPB urging the delay.
 
Click to view larger image Michigan State Sen. Mike Kowall (R-White Lake Township) was among the 200 state lawmakers and staff who attended the Michigan Credit Union League's Capitol Day at the House Office Building in Lansing Oct. 29. (Photo provided by the Michigan Credit Union League).
In Kalamazoo, Mich., U.S. Rep. Fred Upton (R-Mich.) reaffirmed his support for credit unions' key federal issues such as government-sponsored enterprise reform, regulatory relief for credit unions and expanded member business lending. He spoke before 50 credit union leaders, legislators and league officials at a legislative breakfast hosted by KALSEE CU in Kalamazoo. Attendees included Reps. Bo Genetski, Al Pscholka, Margaret O'Brien and Sean McCann, and Sens. Tonya Schuitmaker, John Proos and Jeff Wiggins from Rep. Aric Nesbitt's office (Michigan Monitor Nov. 4).
 
Also in Michigan, about 75 credit union leaders from throughout Michigan turned out Oct. 29 for the Michigan Credit Union League's Capitol Day (Michigan Monitor Nov. 4).  The biennial grassroots lobbying event allows credit unions the opportunity to share lunch with more than 200 state lawmakers and staff, and discuss industry issues, such as the principal residence exemption on foreclosed properties, blight reforms, card skimming, foreclosure process reform and real estate document copies, said the league.
 
Ken Ross, league executive vice president and chief operations officer, accepted resolutions from the state House and Senate in honor of credit unions' dedication to the more than 4.5 million members in Michigan. State Sen. Mike Nofs (R-Battle Creek) and state Rep. Jeff Farrington (R- Utica) sponsored the resolutions and participated in the presentations.  Also attending:  House Financial Services Committee Chairman Mike Callton (R-Nashville) and Senate Banking Committee Chairman Darwin Booher (R-Evert).
 
Pennsylvania State. Rep. Matt Gabler (center) visited Timberland FCU in DuBois, Pa., to discuss current issues in his district and in the state. The event was hosted by the credit union and CEO Carrie Wood, third from left. (Photo provided by the Pennsylvania Credit Union Association)
"The large attendance by lawmakers shows that the Michigan Legislature views credit unions as an important part of our state economy and vital for consumers as trustworthy financial service providers," said MCUL CEO David Adams.

And in Du Bois, Pa., $58 million asset Timberland FCU hosted a meet and greet with state Rep. Matt Gabler (R-75) at its office.  Gabler serves on the House Finance Committee, a key committee for credit unions, said the Pennsylvania Credit Union Association (Life is a Highway Nov. 5). During the event Timberland FCU CEO Carrie Wood and other participants shared what their credit union is doing in the 75th District and learned more about what the committee and State House have planned for the remainder of the year.

Maine CUs Represented On Attorney General's Foreclosure Panel

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PORTLAND, Maine (11/5/13)--The Maine Credit Union League represented the state's credit unions on a forum conducted by State Attorney General Janet Mills about the foreclosure process in Maine.

The forum and panel were organized to study legislative issues and concerns brought up in a number of bills introduced last session. Many of the issues were combined into a single carry-over bill that will be considered in the upcoming legislative session, said the league (Weekly Update Nov. 1).

Ben Marcus, attorney with Drummond Woodsum and legislative counsel for the league, represented the league and credit unions on the panel.  Marcus said that presentations and discussion were more balanced that past forums and some legislative hearings on the topic.  Courts are not ruling in a timely manner on the issue of unopposed motions for summary judgment related to foreclosures, he said.

Mills is considering a dual track procedure to move unopposed cases through more quickly. "All parties agree that cases should be expedited when the mortgaged property is abandoned although reaching consensus on a definition will be challenging," Marcus told  the league.

The opportunity to be part of the discussion helps "provide a forum to reinforce our concerns and issues," said Quincy Hentzel, league director of governmental affairs. "We anticipate foreclosure to again be one of our major legislative issues next session."

Minnesota CUs Continue Growth In Third Quarter

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ST. PAUL, Minn. (11/5/13)--Credit unions in Minnesota expanded in the third quarter, according to data published by the Minnesota Credit Union Network.

The state's credit union league said that the change in prominent measures indicates that positive growth in the industry is continuing in the Land of 10,000 Lakes--a nationwide trend that has been ongoing since the recession officially ended in 2010.

According to the third quarter data:
  • Membership in Minnesota credit unions grew by 0.8%, increasing by 12,000 to 1,591,000;
  • Assets grew by over 0.7%, with annual growth clocking in at 5%;
  • Deposits increased by 0.4%, with annual growth at 5.35%;
  • Loan balances increased by 2.69%, with annual growth at 5.81%; and
  • Net worth was 9.98%, higher than the National Credit Union Administration's "well-capitalized" threshold of 7%.
"As credit unions lend more to Minnesota consumers, it shows that consumer confidence is increasing as well," said Mark Cummins, MnCUN president/CEO. "We're glad to see credit unions contributing to the overall growth of the state's economy."

CUNA Lending Council, CUNA Mutual Present Excellence In Lending Awards

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PHOENIX, Ariz. (11/5/13)--Six credit unions were honored by the CUNA Lending Council and CUNA Mutual Group on Monday for Excellence in Lending.

The awards--for consumer lending, mortgage lending, business lending, and low-to-modest means lending--were presented at the CUNA Lending Council's 19th annual conference in Phoenix, Ariz., at a ceremony emceed by Dan Murray, a CUNA Mutual vice president.

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CUNA Lending Council and CUNA Mutual Group presented their 2013 Excellence in Lending Awards to, from left: front row: Steven Owens, Consumers CU, Consumer winner, $250 million assets and above; Shamus McConomy, GTE Financial, Business winner; Richard Whitman, Texas Trust CU, Mortgage winner, $250 million and above; Crystal Tayes, Upper Cumberland FCU, Mortgage winner, $250 million and below;  Jennifer Watson, Limestone FCU, Mortgage, $250 million and below; Tony Hale, Texell CU, Consumer, $250 million and below; Galen Burke, Texell CU, Low/Modest Means winner; back row: Bill Vogeney, Lending Council chair; and Tom Keepers and Dan Murray, CUNA Mutual Group. (Photo provided by CUNA Mutual Group)
The consumer lending awards were given to Consumers CU of Kalamazoo, Mich., for credit unions with assets greater than $250 million, and Texell CU of Temple, Texas, for credit unions with assets less than $250 million. Consumers CU was recognized for a "Silver Lining" home equity debt consolidation product for borrowers nearing retirement. Texell CU was honored for developing new products, underwriting procedures and decentralizing its business model by devolving decision-making to the branch level after reassessing its consumer lending program in 2008.

Mortgage lending honors were bestowed upon Texas Trust FCU of Mansfield Texas, for credit unions with assets greater than $250 million, and Limestone FCU of Manistique, Mich., and Upper Cumberland FCU of Crossville, Tenn., for assets with less than $250 million.

Texas Trust won for turning around a troubled mortgage portfolio over the past seven years through a publicity campaign that increased member penetration for mortgage lending from 2% to 15%. Limestone FCU was recognized for introducing a 10-year fixed-rate mortgage after assessing itself through member polling and internal ratings. Upper Cumberland won its award for offering a 10-year fixed-rate mortgage to qualified buyers, allowing members to consolidate debt. The incentives management offers hourly employees to help maintain loan-to-share ratio and delinquency rate targets also were recognized by CUNA Lending Council and CUNA Mutual Group.
 
GTE Financial, in Tampa, Fla., received the business lending award for diversifying its loan portfolio and revamping operations in October 2010, after it was threatened by the wave of foreclosures that hit Florida. The credit union decided to nurture its relationships in the community and expanded its small-business clientele, creating a more sustainable asset portfolio in the process.
 
Texell also won the low-to-modest means award for tailoring its lending strategy to its low-income membership base--a move that has seen the credit union's loan performance improve through an invigorated financial literacy campaign and income-specific products like affordable payday loans and holiday loans.
 
The CUNA Lending Council is made up of almost 1,200 credit union lending professionals that work toward highlighting the best credit union industry practices. CUNA Mutual Group offers wholesale insurance to credit unions.

Mortgage Finance Landscape To Change, But To What?

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PHOENIX, Ariz. (11/5/13)--The mortgage market will likely be framed by new regulatory guidelines and market structure in the next few years, according to Alan Bahr, director of lending at the CUNA Mutual Group.

Speaking at the CUNA Lending Council annual conference, Bahr said that four industry-wide issues must be addressed in the wake of the subprime mortgage crisis--the government's role in mortgage finance, the future of Fannie Mae and Freddie Mac, the securitization of loans, and the manner through which financial institutions attract private capital. (See related News Now story: CUNA Frames CU Housing Finance Reform Priorities For Senate Today.)

Despite the pressing issues, Bahr intoned that the industry and the federal government still have more questions than answers.
 
He said that a consensus is forming in Washington that the federal government should maintain a role in mortgage finance.
 
"Fact is, very few borrowers can raise 30-year, fixed-rate money," Bahr pointed out. "Though private capital solutions are preferred by many, the capital markets don't like to provide long-maturity, fixed-rate funding. The only reason 30-year mortgages are viable today is that Fannie and Freddie back them up."
 
He added that while industry stakeholders want to see Fannie and Freddie "wind down," Wall Street and "those who gave us the subprime mess" would almost certainly fill the void--an outcome that should inform the stakeholders' calculus.
 
Bahr said that a new, uniform way of packaging loans into investment vehicles is also needed.

Without addressing the other issues first, he said that the industry can't even begin to discuss how to attract more private capital.

In the face of possible changes, Bahr urged credit unions to listen to credit union service organizations and other associations that have close relationships with regulators.

"Credit unions need to stay ahead of what's being offered in the marketplace so they don't lose their market share," he commented. "Select someone in your credit union to keep abreast of the new programs and products, and then disseminate that information to those who can take action on it."

He warned that mortgage finance could become considerably more complex in the future, but said credit unions could find sympathy from regulators in Washington, because they have demonstrated awareness about smaller lenders in recent years.

Mich. League Testifies On Principal Residence Exemption

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LANSING, Mich. (11/5/13)--
Ashley Ligon of the Michigan Credit Union League and Sara Dolan of East Lansing, Mich.-based Michigan State University FCU testify before the Michigan Senate Finance Committee on principal residence exemption legislation. (Photo provided by the Michigan Credit Union League)
The Michigan Credit Union League and Michigan State University FCU each recently provided testimony on principal residence exemption legislation before the state Senate Finance Committee, the league said.
 
Ashley Ligon from MCUL & Affiliates and Sara Dolan from East Lansing-based MSUFCU provided the testimony. The committee, chaired by Sen. Jack Brandenburg (R-Harrison Township), unanimously voted out Senate Bill 532 (Michigan Monitor Nov. 11).
 
SB 532 would allow financial institutions to maintain the current tax rate of a property when they take possession after a foreclosure. Under current state law, when a financial institution takes possession of a foreclosed property, that property automatically is taxed at the higher non-homestead rate.
 
Maintaining the current tax rate would reduce the financial burden on the institution during the extremely costly foreclosure process, said the league. This also would preserve the ability of many consumers to qualify for mortgages on properties where taxes are escrowed, something they may not be able to do under the new federal "ability to repay" regulations that require the cost of a higher tax rate to be factored in, the league added.
 
The league said it has worked with the bill sponsor and will continue monitoring the legislation as it moves through the Senate and to the House.

Tax Status, Rates, Student Credit In the Media

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WASHINGTON (11/5/13)--Preserving credit unions' tax status continues to get coverage in the media but several other topics of interest--fees for unsecured loans, the perks of a student checking account, student loans and more--are also being reported. The Credit Union National Association and credit unions figured prominently in at least 10 articles and broadcast segments last week.
 
CUNA provided expertise to Reuters for its article about personal or unsecured loans aimed at wooing mass affluent customers, "New Unsecured Loans Beckon, but Should You Bite?" (Oct. 28).  It noted two large banks have personal loans with higher rates.  But Paul Gentile, CUNA executive vice president of strategic communications and engagement, told Reuters that at credit unions, the average unsecured loan is about $2,600 with an average four-year interest rate of about 10%, The article compares rates at TD Bank, which charges from 6.63% to 9.2% for customers seeking less than $10,000, while Citibank's rates range from 6.74% to 19.49%.
 
At PRWeekUs.com (Nov. 1) CUNA's Gentile is featured in a question and answer about why CUNA has launched the Don't Tax My Credit Union initiative. Gentile said that "Congress is engaged in comprehensive tax reform and it is important to tell our story and reinforce the value of the credit union system to Congress." He noted credit unions are nonprofit financial cooperatives serving 97 million Americans with low-cost, high quality financial services and that credit unions return $8 billion in benefits back to consumers annually.
 
The tax status issue was also featured in WUFT News, The Buffalo News (with an op ed by Credit Union Association of New York President/CEO William J. Mellin), and The Heartland Institute.
 
Nerdwallet.com's Oct. 28 item, "Credit Unions Reward Students With Checking Perks," said it "has the inside scoop on a few credit unions that are providing free student checking accounts that pile on the perks, including ATM refunds, rewards points and online account access through just about any mobile device available." It featured three credit unions' programs.
 
In MainStreet.com, Gentile noted that "credit unions are emerging as strong private student lenders, with a $2.3 billion portfolio." Delinquency rates for credit union private student loans are significantly lower that federal student loans as well as other private student loans, he added. Credit unions can consolidate private loans at rates as low as 4.75%, depending on the underwriting results.
 
For those articles--and more--use the link to check out the "In the Media" section of CUNA's Press Page.

Seventh Nomination Received For CUNA Board Elections

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WASHINGTON and MADISON, Wis. (11/5/13)--The Credit Union National Association has received its seventh nomination for the CUNA Board of Directors elections.
 
The newest nominee is Maurice R. Smith, president of Local Government FCU, Raleigh, N.C.  He is the current incumbent and running for the District 3, Class C director position.
 
Eight board positions are open in this year's elections. CUNA will accept nominations through Nov. 26.
 
In addition to Smith, board nominees include: 
  • 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.;
  • District 2, Class D--Rick Pillow, president of the Virginia Credit Union League, Lynchburg, Va.;
  • District 4, Class A--Pat Drennen, CEO of 1st Gateway CU, Camanache, Iowa, and Geraldine Burek, president/CEO of South Division CU, Evergreen Park, Ill.; 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.
Nominees must be an employee or a voting board member of the nominating credit union, with the nomination seconded in writing by at least two other credit unions from the same district and class.
 
Nominees to be elected by leagues must be a league president and be nominated in writing by that league, with the nomination seconded in writing by at least one other league from the district.
 
Ballots for contested elections will be sent Dec. 2, with voting continuing through Jan. 10. Results of these elections will be announced Jan. 15.
 
Directors elected will take office upon the adjournment of CUNA's Annual General Meeting in Washington, D.C., on Feb. 24.
 
For more information, use the link.