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CUs Have Much To Be Thankful For, Cheney Notes

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WASHINGTON (12/2/13)--As credit union leaders prepared to celebrate Thanksgiving this week, Credit Union National Association President/CEO Bill Cheney in the Cheney Report noted that there is much to be thankful for in the credit union system.

"We are thankful there will be no corporate assessment scheduled for credit unions in 2014--which we had called for just this past summer--and that the likelihood of assessments in years beyond that is growing increasingly remote," he wrote. What's more, credit unions could see rebates for the funds paid into the Temporary Corporate Credit Union Stabilization Fund within the next four to five years. "That's certainly something to be thankful for considering where we've come from," Cheney said.

"We can be thankful that credit union members value their credit unions so much that they are willing to get politically active," as millions have used traditional methods and social media to tell their legislators "Don't Tax My Credit Union!" This level of involvement is a tribute to the great job credit unions do every day in serving their members, Cheney added.

Cheney also took time to thank the more than 86,000 credit union volunteers that serve their institutions and fellow members, and, overall, gave thanks for the "great system that we are all part of...A system that puts people first." Credit unions truly do believe, "people are worth more than money," Cheney said.

Cheney also noted developments on the regulatory front, where CUNA and credit unions are making some progress towards building credit unions a better operating environment, and working with the National Credit Union Administration to build a better exam experience for credit unions.

"Let's be thankful that more Americans are choosing to do business with credit unions," as total credit union membership crests 98 million. And, he wrote, "despite our many challenges in recent years, we can all be thankful that Americans have a credit union movement that is strong, safe and sound--and continues to be dedicated to the ideals of "not for profit, not for charity--but for service."

For more of The Cheney Report, use the resource link.

Dakota Bankers Plan Another Tax Push In Yankton, Vermillion

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BISMARCK, N.D. (11/27/13)--The South Dakota Bankers Association Monday presented a resolution proposal to the Yankton (S.D.) City Commission in support of taxing federal credit unions and farm credit system institutions.
 
Credit union advocates attended the meeting and successfully defended against the bankers claims, the Credit Union Association of the Dakotas (CUAD) reported (Memo Nov. 26).
 
The city commission tabled the resolution and will consider it at a later date.

South Dakota banks are attacking the credit union tax status on a county-by-county basis. On Nov. 19, South Dakota's Brookings County Commission Tuesday voted 4-0 to table a bank-backed resolution that would have supported taking the tax-exempt status away from credit unions and farm credit services. Speaking on behalf of South Dakota credit unions at the meeting were Dan Cumbee, CEO Dakotaland FCU, Huron, and Jeff Olson, CUAD vice president of advocacy and awareness (News Now Nov. 20).

Last week, state banks presented a similar proposal to the Yankton County Commission. The county commission also tabled the resolution. 

"As credit unions, we must continue to stand up for our members and our movement," said Olson. "No voice is stronger than our own credit union CEOs, managers, employees and volunteers."
 
Bankers also plan to present their proposal to the Vermillion City Commission on Dec. 2 and to the Vermillion School Board on Dec. 9, CUAD said. League representatives will attend each of the public hearings and are prepared to respond.
 
The Credit Union National Association and credit unions continue to advocate to preserve the current credit union federal tax status on a national level through the "Don't Tax My Credit Union" campaign. Credit unions are assigned that tax status because they are not-for-profit, member-owned cooperatives with the statutory mission to promote thrift and provide credit for provident purposes to their members.

CU System Briefs (11/27/2013)

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  • HARRISBURG, Pa. (11/27/13)--Pennsylvania credit unions participated in a district financial services roundtable with U.S. Rep. Charlie Dent (R-Pa.), according to the Pennsylvania Credit Union Association (Life is a Highway Nov. 25). Alan Musselman, chief financial officer of First Commonwealth FCU,  Lehigh Valley, and a member of PCUA's Governmental Affairs Committee, and Paul Wagner, president/CEO, Hershey FCU, Hummelstown, participated in the event hosted by the Federal Home Loan Bank. The event allowed representatives from financial services, builders, realtors and the Pennsylvania Housing Finance Agency to voice concerns about the challenges they face in today's operating environment. PCUA Vice President, Governmental Affairs Christina Mihalik also attended. Conversation focused on the Dodd-Frank Act, the PATH Act, GSE reform, environmental protection standards and healthcare. Pictured from left are Dent and Wagner. (Photo provided by the Pennsylvania Credit Union Association) ...

CUNA Closed Thursday, Friday, No News Now

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WASHINGTON and MADISON, Wis. (11/27/13)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Thursday and Friday, in observance of the Thanksgiving holiday. There will be no regular issues of News Now those days. News Now will resume regular publication  Monday.

Federation Previews Secondary Capital Report At Forum In Asia

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NEW YORK (11/27/13)--An analyst for the National Federation of Community Development Credit Unions presented an upcoming federation report on secondary capital and its use by U.S. community development credit unions (CDCUs) at the Fourth Annual Asia Future Forum in Seoul, Korea.
 
National Federation of Community Development Credit Unions Analyst Cathi Kim presented information from an upcoming federation report on U.S. community development credit unions' use of secondary capital at a session of the Fourth Annual Asia Future Forum in Seoul, Korea. (Photo provided by the National Federation of Community Development Credit Unions)
Cathi Kim, federation analyst, represented the federation at the forum, whose theme was "Era of Inclusive Growth: Innovation of Enterprise and Society" and which focused on innovations in social economy. The event attracted more than 500 attendees from Japan, China and Korea.
 
Presenting at the Community Finance session Oct. 31, Kim provided background on the products, services and delivery systems that U.S. CDCUs provide to low- and moderate-income Americans.
 
Secondary capital, or supplemental capital, is of particular interest to Korea's credit unions, which have continued to grow in deposits and loans despite the downturn in the global economy, said the federation.  "Secondary capital loans are long-term loans that growing credit unions can use to expand lending in their communities," Kim said. "Secondary capital counts toward the credit union's net worth for the initial period of the loan, improving net worth and helping credit unions meet required capital standards. Several federation members have used secondary capital loans to great success," she said.
 
Korea's credit union movement is the fourth largest worldwide, with 950 credit unions, six million members and US$52 billion in assets. The National Credit Union Foundation of Korea describes the movement there as providing "high value financial services for low and middle income families while promoting the value of cooperation."
 
Kim said interest among forum attendees was particularly high because there is no CDCU equivalent in Korea.  She noted it is "important to strengthen and solidify the basis for social finance, especially community finance [which] is increasing around Seoul."
 
The federation will announce its next funding round, including secondary capital, later this month.

Kentucky's Lyons Named AACUL Chairman

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WASHINGTON (11/27/13)--Wendell Lyons, president/ CEO of the Kentucky Credit Union League, was elected chairman of the American Association of Credit Union Leagues at the group's recent annual meeting.
 
Scott Simpson, president/CEO of the Utah Credit Union Association, was elected to serve on the board.
 
Other AACUL board members include:
  • First Vice Chairman--Tracie Kenyon, president/CEO, Montana Credit Union Network;
  • Second Vice Chairman--John Radebaugh, president/CEO, North Carolina Credit Union League;
  • Treasurer--Mark Cummins, president/CEO, Minnesota Credit Union Network;
  • Secretary--Simpson;
  • Immediate Past Chair--Bill Mellin, president/CEO, Credit Union Association of New York; and
  • Executive Director-- Susan E. Newton, executive vice president, System Relations, Credit Union National Association.
Also, Paul Mercer, president/CEO of the Ohio Credit Union League, was honored with AACUL's Eagle Award for his outstanding achievements, both at the league level and beyond; his dedication to credit union and personal principles; his unflagging focus on important issues; and for implementing new and creative ideas. 
 
The Eagle Award is not given annually, but only when a recipient is deemed worthy of selection.

SECU Foundation Awards $1M Grant To Hospice Center

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RALEIGH, N.C. (11/27/13)--Sta
Click to view larger imageJim Barber, board chair of the SECU Foundation, the charitable arm of Raleigh, N.C.-based State Employees' CU, presented a check for $1 million to Michelle Anderson, chairperson of the Hospice House Foundation of Western North Carolina, to bring the first inpatient hospice facility to six counties in North Carolina. (Photo provided by SECU Foundation)
te Employees' CU (SECU) Foundation presented a $1 million grant on Monday to a facility that will bring inpatient hospice care to six counties in North Carolina.
 
The charitable arm of SECU presented the money in Franklin, N.C., for the SECU Family House of Western North Carolina--an affiliate of the Hospice House Foundation of Western North Carolina--which will serve Macon, Swain, Graham, Cherokee and Jackson Counties.
 
The foundation first committed to a $1 million challenge grant in August to aid the Hospice House Foundation.
 
SECU Foundation Board Chair Jim Barber, who presented the check to the Hospice House Foundation, said that the credit union's members "continue to embrace these statewide initiatives, recognizing the great need for inpatient hospice services throughout North Carolina." The credit union's foundation has supported 12 hospice projects in the state.
 
SECU is based in Raleigh, N.C., and has a total of $26.7 billion in assets.

Health Insurance Options Explored In CUNA HR/TD Council Paper

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MADISON, Wis. (11/27/13)--A new white paper from the CUNA HR/TD Council explores the viability of self-funded employee healthcare plans.
 
The paper, "Health Insurance Plan Options: Self-Funded and Fully Insured," explores how organizations of all sizes are turning to self-funded plans to reduce and manage their health care costs and improve cash flow while still delivering the health coverage they desire for their work force.
 
In self-funded plans, the employer takes on the financial risk of funding its health plan from its assets and becomes responsible for managing and administering the benefit plan.
 
Self-funded plans are governed by the Employer Retirement Income Security Act (ERISA) and appeal to employers because of the greater flexibility that comes with tailoring the plan to their needs with fewer state-mandated features.
 
Among the advantages the paper cites for self-funded employee healthcare plans:
  • Control. Advocates for self-insurance say it's the difference between managing and leveraging the credit union's assets versus just paying premiums. The organization also assumes control of the specific health needs of its employee population.
  • Potentially lower costs. An organization can save 10%-25% of costs by going to a self-funded benefits plan, according to the Self-Insurance Institute of America Inc., the largest U.S. self-funding trade group.
  • Direct benefit. With a self-funded health plan, the employer reaps the benefits of its investment when plan results beat expectations.
  • Use of employee health data. With self-insurance, an employer can collect claims data that can pinpoint health issues that are driving claims costs and provide focused wellness solutions. That means savings because the credit union can target health and wellness efforts toward actual employee experience.
  • Customization. The employer can set premiums based on its employee claims history and adjust the plan in other ways to cut costs. If claims are lower than anticipated, the employer can invest any savings and earn interest.
  • Exemption from most state insurance regulations. Plan sponsors and employers have self-funded their medical plans for more than 30 years, a result of the passage of ERISA.  ERISA exempts self-funded plans from state insurance laws including reserve requirements, mandated benefits, premium taxes, and consumer protection regulations. As a result, an employer can make available uniform, targeted benefits to employees no matter what state they work.
  • Greater flexibility in how the benefits are designed. With a self-funded plan, the organization is basically unraveling or unpacking what it has in a traditional outside insurance company's health plan. It can examine each aspect of what goes into health coverage and decide how to proceed.
 To download the paper, use the link.

Illinois Foundation Awards $31K In Year's Final Grant Round

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NAPERVILLE, Ill. (11/27/13)--The charity arm of the Illinois Credit Union League announced Tuesday that it is giving $30,790 in grants to member credit unions and ICUL chapters.
 
The Illinois Credit Union Foundation awards are going to small-credit union development, community service, market and business development, and financial independence and revitalization efforts.
 
The 16 credit unions receiving a combined $19,340 in small-credit union development grants for software and hardware development are:
  • Alton & Southern Railroad Employees FCU, in East St. Louis;
  • Aurora Postal CU, in Aurora;
  • Cosmopolitan FCU, in Chicago;
  • Decatur Policemen CU, in Decatur;
  • Electric Energy Employees CU, in Metropolis;
  • Electrical Workers CU, in Collinsville;
  • Fairmont Village CU, in East St. Louis;
  • Fellowship Baptist Church CU, in Chicago;
  • Pilgrim Baptist CU, in Chicago;
  • School District No. 9 CU, in Granite City;
  • Sherwin Williams Employees CU, in South Holland;
  • Shiloh Baptist FCU, in Waukegan;
  • Shiloh Englewood FCU, in Chicago;
  • St. Helena CU, in Chicago;
  • St. Jude CU, in Chicago; and
  • Williamson County Catholic CU, in Herrin.
Recipients of the community service grants--worth a combined $2,540--for participation in local community projects are:
  • Education Personnel FCU, Danville;
  • Midwest America FCU, Danville;
  • South Division CU, Evergreen Park;
  • The ICUL Danville Area chapter; and
  • The ICUL Southern Illinois chapter.
These awards will go to projects such as shred days and essay contest for kids.
 
Recipients of the $6,500 in marketing and business development grants--to help credit unions with under $30 million in assets expand outreach--were:
  • Altonized Community FCU, Alton;
  • IBEW Local 146 CU, Decatur;
  • CBI FCU, Plainfield; and
  • SOURCEONE CU, Chicago.
These awards were given to credit unions seeking to introduce new products and promote among a select employee group.
 
The Kane County Teachers CU, Elgin, also received a $2,500 financial independence and revitalization grant, for an initiative to reach out to the Hispanic community in low-income and underserved areas.
 
The Illinois Credit Union Foundation has awarded a total of $109,000 in grants in 2013.

Cornerstone Foundation Announces Grants

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FARMERS BRANCH, Texas (11/26/13)--The Cornerstone Credit Union Foundation announced Monday that it's donating $88,856 to financial education, professional development and disaster relief (Leaguer Nov. 25).
 
Some of the awards were approved by the foundation's committee for the first time earlier this month.
 
Designed, in the words of the foundation, "to empower individuals with their financial well-being," the grants include:
  • Five financial literacy grants worth $5,850;
  • Nine general grants worth $21,006; and
  • Fifteen phase 2 disaster relief grants for victims of Oklahoma tornadoes, worth $62,000.
"Besides the Phase 2 grants, the stand-out grant from this meeting was the grant for CCCS of Central Oklahoma," foundation Executive Director Courtney Moran said, referring to the Consumer Credit Counseling Service of Central Oklahoma. The grant will cover the credit counseling service's first month and setup fees, which total $75 in savings per credit union member.
 
The foundation is the charity arm of the Cornerstone Credit Union League, which serves credit unions in Texas, Oklahoma and Arkansas.

Ardire Appointed To N.J. League Board

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HIGHSTOWN, N.J. (11/26/13)--Campbell Employees FCU President/CEO David Ardire was appointed Thursday to the New Jersey Credit Union League's board of directors (The Daily Exchange Nov. 22). 
 
The appointment came after a board meeting that also saw XCEL FCU President/CEO Linda McFadden voted interim vice chair. 
 
"We are excited to welcome David Ardire to the board and look forward to his active involvement," said NJCUL Chairman Lou Vetere. "His experience at Campbell Employees FCU will prove valuable in representing New Jersey credit unions as he serves on the NJCUL board."
 
Ardire started at the credit union in 1979 as an accountant and systems manager. Although he left it to work for Campbell Soup Company and Piramal Glass--USA, Ardire remained a member of its audit committee and board of directors. He became Campbell Employees FCU vice president of finance in 2011 and was named president/CEO in January.
 
McFadden--serving as a replacement for the vice chair role vacated by Ray Del Nero of Merck Employees FCU--will serve in that capacity until the January board meeting where all table officers are elected for 2014.
 
Campbell Employees FCU is based in Cherry Hill, N.J. ; XCEL FCU, in Bloomfield; and Merck Employees FCU, in Rahway.

Filene Testing Four Products In 'Incubator'

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MADISON, Wis. (11/26/13)--The Filene Research Institute will test four products to benefit low- and moderate-income consumers in its new financial services incubator.
 
The four products were selected from more than 20 submissions. An advisory panel of financial institution staff, researchers and industry analysts helped Filene choose the products.
 
Filene's financial services incubator was launched with a 30-month grant of $700,000 from the Ford Foundation to benefit underbanked consumers. The incubator will test, package and scale financial products that Filene deems innovative and viable to aid low-and-moderate-income U.S. consumers and provide alternatives to predatory products.
 
The products to be tested include:
  • Non-prime Auto Lending, from the National Credit Union Foundation. The program helps lenders fairly price and manage non-prime auto loans, incorporating the Lower Interest For Timeliness (LIFT) idea introduced by Filene's i3 innovation team. LIFT is a loan feature that reduces interest rates when members make on-time payments.
  • Borrow and Save, from the National Federation of Community Development Credit Unions. This product increases consumers' economic security by providing an affordable small-dollar loan with a payment term that makes sense for them. A built-in savings component also helps consumers to self-fund their emergencies instead of borrowing money to handle them.
  • Pay Yourself Back, from Innovations in Poverty Action. As an add-on to any loan type, this product seamlessly converts borrowers into savers. Leveraging the habits formed by regularly making loan payments, it encourages consumers to keep making regular payments (or a portion of it) to themselves after the loan is paid off.
  • Employer Sponsored Income, Advance Loan, from North Country FCU, Chittenden, Vt. This small-dollar loan program is offered to employees of select employer groups partnered with credit unions. Loan payments are auto-deducted from direct-deposited paychecks. Once the loan is paid, employees may continue making payments into savings accounts.

CUs Meet With EU Reps On Basel III, Consumer Protection

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LONDON (11/26/13)--Representatives from the European Network of Credit Unions (ENCU) and World Council of Credit Unions met with European Union (EU) policymakers in London and Brussels last week to discuss how to limit the Basel III liquidity rules' negative impact on credit unions.
 
Click to view larger image European Network of Credit Unions and World Council of Credit Unions representatives met with European Union policymakers in London and Brussels last week to discuss the impact of Basel III liquidity rules on credit unions. From left, Martin Sisk, Irish League of Credit Unions (ILCU); Ed Farrell, ILCU; Anne Schneider, Policy Action (Brussels); Breege-Anne Murphy, ILCU; Wiktor Kaminski, National Association of Co-operative Savings & Credit Unions (Poland) (NACSCU); Michael Edwards, World Council; Pawel Grzesik, NACSCU; Andrus Ristkok, Estonian Union of Credit Cooperatives; Brian McCrory, ILCU; Eleonora Zgonjanin, FULM Savings House (Macedonia); Florin Simion, Federation of Romanian Credit Unions; and Matt Bland, Association of British Credit Unions Ltd. (Photo provided by World Council of Credit Unions)
ENCU and World Council also met with EU authorities about consumer protection and taxation issues affecting credit unions in Europe.
 
Representatives were from all six ENCU member organizations--Association of British Credit Unions, Ltd., Estonian Union of Credit Cooperatives, Federation of Romanian Credit Unions  FULM Savings House (Macedonia), Irish League of Credit Unions and National Association of Co-operative Savings & Credit Unions (Poland). They met with the European Banking Authority's (EBA) Regulation section in London Nov. 21 to ask the EBA to consider establishing a credit union-specific liquidity classification under the EU's European Basel III rules to reflect that credit unions' deposits in banks are generally "sticky and stable," even during times of economic stress.
 
ENCU representatives also met with the European Commission in Brussels Nov. 22 regarding the Basel III rules to make the same request.
 
Credit unions' deposits in European banks currently are classified under Basel III as "wholesale funding." The "wholesale" classification assumes that most or all of these deposits would be withdrawn during periods of economic stress, even though European credit unions significantly increased their deposits in banks during the global financial crisis that began in 2007.
 
Banks must hold increased reserves for "wholesale" deposits compared to the reserves required for "small business" or "retail" deposits. The higher reserve requirements increase the banks' cost of funds when doing business with credit unions. The new costs have resulted in Irish banks reducing the yields they pay on credit union deposits by an average of 1.5%, and also have contributed to some banking institutions in Great Britain ceasing to accept credit unions deposits.
 
World Council and the Irish League met with the Basel Committee on Banking Supervision in September regarding the classification of credit unions' deposits in banks under Basel III liquidity rules.
 
"Application of 'wholesale funding' classification for credit unions' deposits does not reflect the actual behavior of credit unions' bank deposits," said Brian Branch, World Council president/CEO. "This EU correction of the Basel III interpretation will ensure that credit unions can continue to deliver financial inclusion in Europe."
 
ENCU members also met with the EBA's and the European Commission's Consumer Protection sections Nov. 21-22 concerning upcoming EU directives and guidance papers on mortgage lending, payment accounts and other payment services.
 
ENCU met with the European Commission's Tax section Nov. 22 to discuss implementation of the U.S. Foreign Account Tax Compliance Act and related EU and Organisation for Economic Cooperation and Development initiatives concerning automatic exchange of tax information about credit union members who are neither a resident nor a citizen of the jurisdiction.
 
ENCU is a network of national credit union associations in Europe and World Council representatives who educate and engage with EU policymakers and other stakeholders on legislation that affects credit unions. ENCU was formally established in 2010 and is based in Brussels.

CU CEO Confidence In Economy Slips

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PLANO, Texas (11/26/13)--Credit union CEOs' confidence in the economy fell in the third quarter, according to a survey conducted by Catalyst Corporate FCU.
 
The Plano, Texas-based wholesale cooperative financial institution's CEO confidence index fell to 24.02, from 27.46 in the second quarter.
 
Measurements of credit union CEOs' assessment of present conditions and future expectations fell to 23.42 and 24.32--from 25.44 and 28.48, respectively.
 
The increase in pessimism can most likely be attributed to the partial government shutdown in October, another round of congressional fiscal negotiations anticipated in the new year and weak economic growth, said the corporate.
 
"A lot hangs in the balance with the U.S. government," one CEO who responded to the survey commented. "With the weak leadership in D.C., it could all go south quickly and not be good for the consumer."
 
Bob Steensma, CEO of the $256 million-asset Dothan, Ala.-based Five Star CU agreed that the dysfunction in Washington hangs over credit unions, but noted generally that the economy is "not what we were hoping for, especially heading into the end of the year, when real estate sales are traditionally slower and loans are fewer."
 
The third quarter survey indicated that credit union CEOs are more concerned about individual members' well-being than their own financial institution's health. An index measuring members' current financial conditions dropped to 16.59 from 21.14 in the second quarter, while a gauge of credit unions' financial condition actually ticked upward, to 30.32 from 29.80.
 
CEOs' expectations for members' financial condition in six months also plummeted, to 21.27 from 28.17, while expectations for their own credit union's financial situation in that time dropped to 33.56 from 35.28.
 
Indexes predicting both loan demand and share deposit growth in six months also receded in the third quarter by about four points.
 
Catalyst Strategic Solutions' Director and Chief Strategist Brian Turner pointed out that while credit unions with over $500 million in assets saw their loan portfolios balloon by over 9% in the third quarter, these larger institutions account for only 7% of all credit unions.
 
"The industry overall is experiencing a 5.5% increase, indicating the remaining 93% of credit unions have been more challenged in attracting loans," he said.

"The survey appears to represent the thoughts of the '93%,'" Turner added. "Whereas the outlook for consumer spending next year is positive, loan production will continue to challenge most credit unions."
 
The survey, which contains six questions, has been conducted quarterly since 2004. This quarter, it was sent on Oct. 10 to 1,343 credit union CEOs around the country, with 224 responding by the Oct. 31 deadline.
 
Catalyst Corporate FCU serves more than 1,200 member credit unions.

Nominations Due Today For CUNA Board Elections

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MADISON, Wis., and WASHINGTON (11/26/13)--Today is the deadline for nominations for the Credit Union National Association Board elections. Nominations are due to CUNA by 5 p.m. CT today.
 
CUNA also announced it has received an eighth nomination for the board. Nominated for a seat in District 2, Class B, is Dallas Bergl, president/CEO of INOVA FCU, Elkhart, Ind.
 
Eight CUNA Board positions are open in this year's elections. In addition to Bergl, the 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 3, Class C: Maurice R. Smith, president of Local Government FCU, Raleigh, N.C.;
  • 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 and results of the elections 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.

CUNA Council White Paper Explores Marketing Metrics

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MADISON, Wis. (11/26/13)--A new white paper from the CUNA Marketing & Business Development Council makes the case for developing and using of objective measurements that quantify the contribution of marketing to the credit union's bottom line and achievement of its strategic goals.
 
The paper, "Mastering Metrics: Measure What Matters in Marketing and Business Development," sets out a system for planning on which metrics to measure, what information is needed to make those metrics actionable inside and outside the marketing department, and how to work with colleagues in other departments to make those metrics as useful as possible.
 
Three case studies from credit union marketing and business development departments provide examples of how marketers develop and share metrics with their boards, executive teams, and staffs.
 
One of the case studies is Indianapolis-based Eli Lilly FCU's measurement of member engagement--products and services per household, the rate and pace at which account balances are growing, and the member groups that are driving growth.
 
Online services are central to Eli Lily FCU's business model. More than half its members never visit a branch, so monitoring website and call center use provides key indicators about quality of service: What kinds of questions are members asking, and are they getting the right answers? Do members receive the e-mail their credit union sends, or does it bounce back or end up in a spam folder? How many unique visitors does the website have, and how do they get there?
 
One Eli Lilly FCU manager is dedicated to website and social media marketing, applying data from analytical tools about website traffic, click-throughs from Facebook and Twitter, and mentions in user-generated content to optimize the credit union's positioning as a financial adviser and source of useful products and services.
 
Four in five members are active online users, so the credit union works to ensure that its website is easy to navigate and that members can quickly find answers to their questions. An online banking conversion in early 2013 included the launch of a database to continually update online FAQs based on member inquiries and feedback.
 
The credit union also employs a business intelligence unit, with an assistant vice president and two staffers who translate information from marketing customer information files and customer relationship management systems into metrics for improving member service and communications. Eli Lilly FCU also imports data from third-party sources to integrate with internal data in the data warehouse for a fuller picture of members and their financial needs and preferences. Optimizing business intelligence is critical in helping the credit union develop and maintain its brand, the paper said.
 
 
To download the paper, use the link.

Equifax: Retail-issued Credit Cards At Four-year High

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ATLANTA (11/26/13)--Retail-issued credit cards total 183 million, the most since September 2009, said Equifax in its latest National Consumer Credit Trends Report. Balances passed the $56 billion mark, a year-over-year increase of more than 6.4%.
 
New credit issued from January to August of 2013 totaled $46.6 billion, up 11.6% from the same period in 2012, said Equifax.
 
During the first eight months of 2013, roughly 24.6 million new card accounts were issued--the highest since 2008 and an increase of 8.8% from a year earlier. Year-to-date lending through August to subprime credit borrowers with Equifax Risk scores below 660 increased 15.8% over the period in 2012, with a six-year high of 8.2 million loans originated.
 
Write-offs and delinquencies were down.  Retail-issued credit card write-offs dropped nearly 14%--to 7.09% from 8.24% in October 2012.  During that time, 60-day delinquency rates for retail cards fell slightly, to 3.48% from 3.52%.
 
"The holiday season is almost upon us and retailers are eager to capture the hearts and wallets of the American consumer," said Equifax Chief Economist Amy Crews Cutts. "Retailers can leverage these cards to drive traffic to their stores through special offers to cardholders and can encourage larger purchases by offering favorable interest-rate promotions for big ticket items. As long as consumers resist the urge to overspend, these cards can be a great way to save money."
 
Credit cards issued by credit unions and other financial institutions totaled $128.7 billion. The total limit of new credit issued from January to August 2013 is a five-year high for that period and is up 9.1% from the same period last year, which totaled $117.9 billion, said Equifax.
 
Other findings for financial institution-issued cards:
  • The number of new loans January-August 2013 totaled 27.6 million, a five-year high and an increase of 7.3% from same time a year ago.
  • Existing loans in October totaled more than 312 million, the highest since December 2009.
  • The outstanding balance on financial institution-issued credit cards totaled $537.2 billion and represents a year-over-year increase for four consecutive months. This marks the first time in more than five years that such an increase has occurred.
  • From October 2012 to October 2013, the 60-day delinquency rates decreased 13.6% (from 2.18% to 1.88%), while write offs dropped 18.4% (to 3.92% from 4.81%).
Auto loans in October totaled nearly 62 million, a five-year high. The 29.9 million loans financed by credit unions and other financial institutions totaled $411.6 billion, all-time highs for both figures. Comparable numbers funded by auto finance companies were $435.1 billion financed for 32 million loans, the highest level since January 2009. More than $327.3 billion in auto loan originations were made January to August 2013. That is a 15.6% increase from a year earlier and the most new credit originated for the first eight months of a year in more than eight years.
 
Mortgage loans decreased in October, with first mortgage balances totaling $7.6 trillion, down 1.7% from a year earlier. Severe delinquencies (90 days past due or in foreclosure) for first mortgages totaled less than $300 billion for the first time in more than five years. The figure represents a decrease of more than 30% from the same period in 2012.

In the Media: CUs, JP Morgan Settlement, Tax Reform

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WASHINGTON (11/26/13)--The Wall Street Journal, The Street and The Hill carried comments during the past week from the Credit Union National Association on topics ranging from tax reform, to the National Credit Union Administration's settlement of its lawsuit against JP Morgan Chase and Wall Street banks over mortgage-backed securities.

Meanwhile, other publications pointed out the good work and benefits of credit unions, according to CUNA's weekly InThe Media Report (Nov. 22). The report covers mentions of CUNA and credit unions in the media and is available to CUNA's member credit unions.

The Wall Street Journal (Nov. 19) noted that NCUA "usually isn't known as the John Wayne of Washington financial regulators" but "it has been unusually tough on Wall Street firms that sold mortgage-backed securities."  The article includes a statement from CUNA President/CEO Bill Cheney, saying, "I think [the NCUA] absolutely should, on behalf of the credit unions, recover as much as possible," as well as from NCUA Chairman Debbie Matz who noted, "We have made it clear to the defendants that we are willing to stay with this to the end."
 
In The Street (Nov. 19), Cheney is featured as saying in a telephone interview that he was pleased that credit unions would see some restitution for shaky mortgage securities they bought from JPMorgan. "One could certainly argue that it could have been more," Cheney said. "Having said that, we are happy with the settlement," he added. The Street featured Cheney's comments above comments made by JP Morgan CEO Jamie Dimon.
 
In an article about the secrecy involved in keeping what is in the  tax reform plans under wraps, The Hill (Nov. 19) included comments from CUNA Senior Vice President for Legislative Affairs Ryan Donovan , who noted rumors are just that.
 
In "It's banks that are spinning fairy tales, not credit unions," an opinion editorial published in Friday's Albuquerque Business First, Sylvia Lyon, president of the Credit Union Association of New Mexico, and Chris Fitzgerald, league chair and CEO of Rio Grande CU in Albuquerque, responded to a bank's op-ed and point out that banks and credit unions are not the same.
 
"Unlike banks, credit unions are not-for-profit cooperatives, owned by their members and managed by volunteer boards," said Lyon and Fitzgerald. "Most credit unions are based in and directly benefit the community they serve. They have no stockholders demanding market rate return on their investments. Earnings are passed along to member-owners," they continued.
 
Use the link to check out the articles.

CU System Briefs (11/25/2013)

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  • ST. PAUL, Minn. (11/25/13)--Affinity Plus FCU has named Dave Larson as its new president/CEO. A longtime member of the credit union's leadership team, Larson also has served as executive director for its charity arm, the Affinity Plus Foundation. In that role, Larson has established a working relationship between the credit union and Children's Hospitals and Clinics of Minnesota. He also is a board member of the Minnesota Credit Union Foundation. "I am extremely honored to be offered this incredible opportunity," Larson said in a statement. "I have always had a strong passion for Affinity Plus, our members and employees, and will leverage this passion as CEO to continue to put people's needs at the heart of all that we do." Affinity Plus FCU is based in St. Paul, Minn., and has $3.5 billion in assets ...

Hope CU Investment Helps Create 22 Jobs

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NASHVILLE, Ark. (11/25/13)--Hope Enterprise Corp. and Hope CU, Jackson, Miss., (HOPE) have committed $8 million in New Markets Tax Credit (NMTC ) allocation to Husqvarna Group's Nashville manufacturing facility.
 
The funding will be used to purchase new machinery, which will bring the plating and honing process in-house and will be more efficient and environmentally friendly than commonly used methods.
 
The new plating and honing line will create 22 new jobs at the 1,200 employee facility. 
 
Husqvarna Group operations in Nashville support more than 800 additional jobs in Southwest Arkansas.
 
"The jobs supported by this investment offer good wages and benefits, and generate a tremendous economic impact in southwest Arkansas," said HOPE CEO Bill Bynum. "Companies like Husqvarna are vital to a prosperous community, which makes it a perfect fit for our mission, and for our New Markets Tax Credits."
 
The NMTC allocation from HOPE is being paired with a $2 million allocation from Chase New Markets Corp. to support an equity investment by Chase Community Equity (JPMorgan Chase Bank, N.A.) into the $10 million equipment purchase and installation.
 
Credit unions are among those eligible to participate in the NMTC, which seeks to spur the investment of new private sector capital into low-income communities. To do so, it permits individual or corporate taxpayers to receive a credit against federal income taxes for making Qualified Equity Investments. Those investments must be made in designated Community Development Entities.
 
The U.S. Treasury's Community Development Financial Institutions Fund oversees the tax credit program and allocates the tax credits annually through a competitive application process.

CUs Collect Food For Thanksgiving Holiday

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MADISON, Wis. (11/25/13)--Credit unions and credit union organizations nationwide are collecting food and volunteering their time to bring comfort to their neighbors during the Thanksgiving holiday.
 
Click to view larger image At a ceremony at Good Shepherd Food Bank's Brewer, Maine, location, representatives from Maine's credit unions present a check to fund the Food Mobile and purchase 8,000 Thanksgiving meals. (Photo provided by Maine Credit Union League)
Among the credit unions that are serving their local communities:
  • Maine Credit Unions' Campaign for Ending Hunger celebrated its partnership with the Good Shepherd Food Bank with a contribution that will help purchase 8,000 Thanksgiving meals for Maine people and their families across the state.
  • Veridian CU, Waterloo, Iowa, is preparing for the annual Mike and Leona Adams Thanksgiving Dinner. Union retirees and credit union volunteers expect to feed about 1,000 people seeking a free hot meal and companionship. The Northeast Iowa Agency on Aging will deliver 350 dinners to its current Meals on Wheels recipients.
  • Several Green Bay area credit unions are participating in the Stock the Shelves campaign to assist local food pantries. Participating credit unions include Fox Communities CU, Community First CU, Appleton; Harbor CU, Green Bay; PCM CU, Green Bay; Horizon Community CU, Green Bay, Northern Paper Mill CU, Green Bay, and Schneider Community CU, Green Bay.
  • Employees of RTN FCU, Waltham, Mass., are holding food drives and other activities to help families in local communities. RTN's Employees Community Outreach Committee's Thanksgiving activities this year include: collecting Thanksgiving food items for eight Waltham families at RTN's Waltham branch; holding a Thanksgiving food collection for needy families in Amesbury, Danvers and Lawrence through RTN branches in those communities; holding a Thanksgiving non-perishable food collection for the Brookline Food Pantry through the Brookline branch; and holding a toy drive to Benefit the Wish Project in Lowell through RTN's Tewksbury branch.
  • Click to view larger image Security Service FCU, San Antonio, kicked off the annual Food4SA campaign Nov. 1 with a $30,000 donation to the San Antonio Food Bank. From left, Art De Leon, San Antonio Food Bank; Laura Cohrs, SSFCU Volunteer Corps; Jennifer Carter, San Antonio Food Bank; Marinda Noe and Amy Cardenas, SSFCU Volunteer Corps. (Photo provided by Security Service FCU)
    America's Christian CU, Glendora, Calif., is partnering with the City of Glendora and the Glendora Community Coordinating Council in the annual Holiday Basket Program. During the Thanksgiving and Christmas seasons each year, Glendora's Holiday Basket Program provides food baskets for over 400 families in need in Glendora and surrounding communities.
  • On Nov. 9, Citizens FCU, Midland, Texas, and the West Texas Food Bank teamed up to fill a truck with donated food as part of the annual "Stuff the Truck" event. The event was created to allow the community to donate canned food items to the West Texas Food Bank, which is in need of food assistance, especially during the busy holidays, said the Cornerstone Credit Union League (Leaguer Nov. 13).
  • Security Service FCU, San Antonio, kicked off the annual Food4SA campaign Nov. 1 with a $30,000 donation to the San Antonio Food Bank.
  • On November 14, Heritage Family Credit Union teamed up with Northwest Elementary School in Rutland to deliver 7,680 items to the Salvation Army for the Stuff-A-Bus campaign. A check for $1,540 was also presented to the Salvantion Army, said the Assocation of Vermont Credit Unions (Newslines Express Nov. 22).
  • IC FCU, Fitchburg, Mass., donated $2,500 to the Worcester County Food Bank to support its hunger-relief efforts during the holiday season.

Massachusetts League Names Gentile President/CEO

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MARLBOROUGH, Mass. (11/25/13)--The Massachusetts Credit Union League (MCUL) Board of Directors has named Paul Gentile as president/CEO effective Jan. 6th.
 
Gentile succeeds Dan Egan who is retiring after 32 years of service to the league. The Massachusetts Credit Union League has management agreements in place with the New Hampshire Credit Union League and the Credit Union Association of Rhode Island. The appointment of Gentile culminates a comprehensive search process that included members of the boards from each of the three leagues.
 
"Paul is a proven leader. He brings a track record of success in advocacy, communication and product development that will serve our member credit unions well as we strive to meet their changing needs," said St. Jeans CU CEO and MCUL Chairman David Surface.
 
Gentile currently serves as executive vice president of strategic communications for the Credit Union National Association. During his tenure at CUNA, he helped launch a number of new national communication vehicles, including The Cheney Report and "Inside Exchange."
 
"It is a great honor to succeed Dan and build on the strong foundation he helped create here. I look forward to working strategically with the dedicated volunteers on the boards and the talented staff to best serve our member credit unions in Massachusetts, New Hampshire and Rhode Island," said Gentile.
 
Prior to CUNA, Gentile was the president/CEO of the New Jersey Credit Union League (NJCUL). Under his leadership, NJCUL spearheaded cooperative advocacy initiatives such as the statewide "Banking You Can Trust" consumer awareness campaign and successful passage of public deposit legislation that enabled New Jersey's credit unions to accept public funds. NJCUL also developed a student loan credit union service organization, a shared compliance program, a regional conference (Credit Union Reality Check), and an array of strategic communication tools during his tenure. Before joining NJCUL, Gentile was the editor/publisher of Credit Union Times, the nation's largest independent credit union trade publication.
 
CUNA President/CEO Bill Cheney wished Gentile well in his new role. "In a short time, Paul has made significant advancements here at CUNA. I am thrilled that he remains part of the CUNA/League system and I look forward to our continued partnership as he brings his leadership to the three associations," said Cheney.
 
"It has been a great experience at the national association. CUNA has a dedicated team of professionals that are relentlessly advocating for the credit union system. The work being done here in Washington is not easy, and they do it well. From their tireless work on the Hill to their advocacy with NCUA, CFPB and other key regulators, they are constantly moving the ball forward so credit unions have a good operating environment to succeed," said Gentile.
 
MCUL blazed the trail for league cooperation with the New Hampshire management agreement in 1985 and later with the Rhode Island agreement in 1992. The leagues are managed under the jointly owned New England Credit Union Services.

CU Foundation Of the Dakotas Awards Grants, Donation

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BISMARCK, N.D. (11/25/13)--The Credit Union Foundation of the Dakotas recently awarded three financial literacy grants and made a donation to local community foundation.
 
Rural Offices of Community Services, Lake Andes, S.D., and Interlake's Community Action Partnership, Madison, S.D. received $750 financial literacy grants. Junior Achievement of South Dakota, Sioux Falls, received a $1,250 financial literacy grant.
 
The Rural Offices of Community Services and the Interlake's Community Action Partnership will be use the awarded funds to support their local Volunteer Income Tax Assistance programs supporting the elderly as well as low- to moderate-income families with free tax preparation assistance.  Foundation funds will also support the classroom programs offered by Junior Achievement throughout the state of South Dakota.
 
The foundation also made a $500 donation to the Black Hills Community Foundation to help local ranchers who lost cattle in early heavy snows the Dakota plains were hit with in October. Highmark FCU, Rapid City, led the local effort to collect funds for ranchers.
 
The Credit Union Foundation of the Dakotas is funded by participating North and South Dakota credit unions. It funds projects in the areas of access to financial services, financial education, savings and asset accumulation, and small credit union development.

CUNA CFO Council White Paper: Cooperation Helps CUs Thrive

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MADISON, Wis. (11/25/13)--If the credit union movement was founded on the principle of "people helping people," future success may depend on the similar principle of "credit unions helping credit unions," according to new white paper from the CUNA CFO Council.
 
"Sharing the Burden and the Success: Old and New Ways Credit Unions Can Benefit By Joining Forces," takes an in-depth look at ways credit unions are teaming up to design solutions that generate income, eliminate expenses, expand products and services, and otherwise enhance relationships with members.
 
Among the case studies the paper looks at is Lancaster, Pa.-based Everence FCU's participation is what participation in the "Go Big" project--an effort of six small- to medium-sized credit unions, all of which boast between $70 million and $140 million in assets, "to essentially create a shared back office," said W. Kent Hartlzer, president/CEO of Everence FCU.
 
"We're trying to concentrate the areas that are non-facing and non-differentiating...the administrative, corporate, behind-the-scenes things that we all do but don't set us apart," he added, with the result hopefully being that the collaborating credit unions, "can achieve the same kind of scale as a $650 million credit union--as opposed to six, $100 million credit unions."
 
 So far, Everence FCU and the other institutions have engaged a project manager and "put about $20,000 of at-risk capital, as working capital, on the table...to push out a project plan and see whether or not this could work," Hartzler said.
 
 
"Our basic premise is that our operating expenses as credit unions--and not just for us six credit unions, but for the movement as a whole--are too high," he adds. "Too high relative to the number of assets we're managing at the moment."

Filene Study: Social Media Can Achieve Business Results

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MADISON, Wis. (11/25/13)--A strong social media presence can help credit unions acquire members, build relationships, retain current members, and deepen community involvement, according to a new study from the Filene Research Institute.
 
An organization's social media mastery has become a brand expectation for many consumers, said the paper "Beyond Engagement." Many potential new members and new hires will not even consider a credit union that doesn't have a consistent presence and a defined social media strategy.
 
A pilot project managed by Filene and social media research firm QueSocial allowed credit unions to leverage employees who use QUEsocial's social business portal to share credit union-related content, recruit new employees and promote sales. The 90-day Filene-QUEsocial pilot investigated whether credit unions can generate real business wins by connecting with people via employees' social networks on Facebook, Twitter, and LinkedIn.
 
Among the recommendations made by the study:
  • Use employees as ambassadors through social media activities. While a corporate social media presence is one of the foundational building blocks of a fully realized social media strategy, incorporating individual employees as credit union ambassadors has the power to drive the organization's social media efforts forward toward even stronger bottom-line business outcomes.
  • Allocate time to social media activities. The amount of time participants can spend on social media should be optimized based on each individual's experience and social network size.
  • Target a set amount to time each week for social media activities. One approach to help participants learn about how to integrate social into their daily routines and activities was through game playing. For example: Participants were challenged to accomplish in 30 minutes a week

NEW: Gentile Named President/CEO of the Massachusetts CU League

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MARLBOROUGH, Mass. (11/22/13, UPDATED: 9:50 A.M. ET)--The Massachusetts Credit Union League (MCUL) Board of Directors has named Paul Gentile as President/CEO effective Jan. 6th.

Gentile succeeds Dan Egan who is retiring after 32 years of service to the League. The Massachusetts Credit Union League has management agreements in place with the New Hampshire Credit Union League and the Credit Union Association of Rhode Island. The appointment of Gentile culminates a comprehensive search process that included members of the boards from each of the three leagues.

"Paul is a proven leader. He brings a track record of success in advocacy, communication and product development that will serve our member credit unions well as we strive to meet their changing needs," said St. Jeans CU CEO and MCUL Chairman David Surface.

Gentile currently serves as Executive Vice President of Strategic Communications for the Credit Union National Association. During his tenure at CUNA, he helped launch a number of new national communication vehicles, including The Cheney Report and Inside Exchange.

"It is a great honor to succeed Dan and build on the strong foundation he helped create here. I look forward to working strategically with the dedicated volunteers on the boards and the talented staff to best serve our member credit unions in Massachusetts, New Hampshire and Rhode Island," said Gentile.

Prior to CUNA, Gentile was the President/CEO of the New Jersey Credit Union League (NJCUL). Under his leadership, NJCUL spearheaded cooperative advocacy initiatives such as the statewide "Banking You Can Trust" consumer awareness campaign and successful passage of public deposit legislation that enabled New Jersey's credit unions to accept public funds. NJCUL also developed a student loan credit union service organization, a shared compliance program, a regional conference (Credit Union Reality Check), and an array of strategic communication tools during his tenure. Before joining NJCUL, Gentile was the Editor/Publisher of Credit Union Times, the nation's largest independent credit union trade publication.

CUNA CEO Bill Cheney wished Gentile well in his new role. "In a short time, Paul has made significant advancements here at CUNA. I am thrilled that he remains part of the CUNA/League system and I look forward to our continued partnership as he brings his leadership to the three associations," said Cheney.

"It has been a great experience at the national association. CUNA has a dedicated team of professionals that are relentlessly advocating for the credit union system. The work being done here in Washington is not easy, and they do it well. From their tireless work on the Hill to their advocacy with NCUA, CFPB and other key regulators, they are constantly moving the ball forward so credit unions have a good operating environment to succeed," said Gentile.

MCUL blazed the trail for league cooperation with the New Hampshire management agreement in 1985 and later with the Rhode Island agreement in 1992. The leagues are managed under the jointly owned New England Credit Union Services.

CU System Briefs

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  • DECATUR, Ala. (11/22/13)--A woman who allegedly defrauded a Redstone FCU branch in Decatur, Ala. this month was arrested Tuesday (Decatur Daily Nov. 20). Demisha Donsha Eggleston, 22, a resident of the town, is accused by police of depositing forged checks into an account at the credit union on Nov. 6 and withdrawing the money on the same day. She was charged with two counts of second-degree possession of a forged instrument. Redstone FCU is based in Hunstville, Ala., and has about $3.3 billion in assets ...
  • DENVER, Colo. (11/22/13)--Westerra CU announced last week that it's giving $37,979 in grant money to Denver Public Schools, Jefferson County Public Schools and the Douglas County School District. The donations are being made as part of Westerra's 2013-2014 School Grant Program. It has given money to Denver and Jefferson County Public Schools for four consecutive years and has given to Douglas County schools for two consecutive years through the program. Between $400 and $700 will go to supporting school supplies, musical instruments, classroom materials, sports equipment and after school programs at 26 schools in Denver, 27 schools in Jefferson county and six schools in Douglas County. "Westerra is an education and community credit union, and we are honored to support our schools in their efforts to help students achieve academic and personal success," said Westerra President/CEO Alan Peppers. Westerra CU is based in Denver and has about $1.2 billion in assets ...

Rosenthal To Depart CFPB

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WASHINGTON (11/22/13)--Cliff Rosenthal, the former CEO of the National Federation of Community Development Credit Unions, will leave his current post with the Consumer Financial Protection Bureau in March, the CFPB confirmed Wednesday.
 
A CFPB spokesperson would not provide a reason for Rosenthal's departure.
 
Rosenthal left the National Federation of Community Development Credit Unions in May 2012 to take a job with the CFPB (News Now March 5, 2012). At the time, he said the government position would allow him to "pursue the mission that has guided me throughout my career: providing financial access and a route to economic self-sufficiency for low-income people."
 
When Rosenthal joined the federation, its existence was in question. At the time of his departure, the organization included than 200 credit unions in its membership, with total assets of some $13 billion and membership of 1.7 million.

'Big Data' Offers Great Promise

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MADISON, Wis. (11/22/13)--Many credit unions won't get involved with big data because of a lack of resources, but that's a short-sighted approach.
 
Click to view larger image When tracked properly, big data allows credit unions to customize service based on members' specific financial situations and needs, according to Peter Halenar, vice president of strategic partnerships for MoneyDesktop. (CUNA photo)
Don't let the magnitude of "big data," or uncertainty over how best to use it, paralyze your credit union's ability to take advantage of its great promise, the Credit Union National Association's Credit Union Directors Newsletter reports.
 
Large corporations and financial services competitors already rely on big data. Increasingly, they use it to siphon away business opportunities with your members, according to Peter Halenar, vice president of strategic partnerships for MoneyDesktop.
 
"I would highly suggest that you start to have the conversation internally," Halenar told attendees of the recent CUNA Community Credit Union & Growth Conference. "You can either start to address it now, or after it's passed you by and you have to play catch-up. That's not a situation you want to be in."
 
The world produces as much data in two days as in the previous 5,000 years, Halenar said, offering a treasure trove of information if interpreted properly. Predictive policing helps departments target areas where crime is on the rise. Netflix analyzes usage patterns of the 31 million customers who stream its movies to recommend other content for their queues. Retailers target advertising to customers based on their recent purchases.
 
"Information is the oil of the 21st century, and analytics is the combustion engine," Halenar said, quoting Peter Sondergaard, senior vice president and global head of research at Gartner.
 
Financial institutions can use big data to track when members are due for a car loan, or when they need a mortgage. Credit unions also can determine which members bank elsewhere and customize offers explaining how much money they'd save if they brought all their business in-house.
 
"When you learn to corral that information, and turn it into actions that benefit your credit union, you'll gain wallet share, increase membership, and turn more members into primary financial institution (PFI) members," Halenar said.
 
Many credit unions won't get involved with big data because of a lack of resources, Halenar said. Personal finance management (PFM) products like MoneyDesktop sift external and internal data sources and provide customized, user-friendly reports without taxing information technology (IT) departments.
 
Big data can free up your IT department to let it concentrate on other things that are mission critical, he said.
 
"Put that technology into your hands, so you can parse, slice, and dice the data in ways that are meaningful to you," Halenar said. "It makes your organization more efficient."

Alert: Phishing Scheme Claims To Be 'CUNA's Security System'

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MADISON, Wis. (11/22/13)--The Credit Union National Association has learned that some credit unions and credit union members have received fraudulent phishing activity on their cell phones.
 
Phishing is the act of attempting to acquire information such as usernames, passwords, and credit card details (and sometimes, indirectly, money) by masquerading as a trustworthy entity in an electronic communication. Communications purporting to be from popular credit/debit card service providers, social web sites, auction sites, online payment processors or IT administrators are commonly used to lure the unsuspecting public.
 
CUNA has learned that some members have received a text message asking them to call 425-606-3663. CUNA tested the number and learned it was an automated system stating it was the Credit Union National Association's Security System. It would then ask the caller to enter debit card information.

CUNA does not house any credit union credit or debit cardholder accounts and would not solicit this information in any way. Any call or email claiming to be "CUNA" and asking for credit, debit or any other personal information is fraudulent. If you receive a text, email, phone call, or voice message that rouses any sort of suspicion, it is most likely a phishing or fraudulent attempt to gain unlawful access to your credit, debit, or other credit union-related accounts. 
 
Phishers want consumers to react immediately and include upsetting or exciting statements which trigger fear or happiness. They may falsely claim suspicious withdrawals from a banking account, present victims as winners of a lottery or play on the victim's passion for politics or religion. Consumers should never give any account information on the web, or in an unsolicited phone call such as the one described above.

 

Delaware League Unites For Good At the Harness Races

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DOVER, Del. (11/22/13)-- < As host of the National Credit Union Administration's Region II Fall meeting at the Dover Downs Hotel & Casino this week, the Delaware Credit Union League (DCUL) took a unique approach to spreading the credit union message: Harness racing.
 
Monday's 14th race at Dover Downs, with a purse of $6,000, was titled, "Credit Unions--Unite For Good" in the evening's program, under sponsorship of the DCUL.
 
As the race took place, meeting attendees dined at the Winner's Circle Restaurant overlooking the racetrack.
 
"As the trotters raced around the track, the tote board lit up with our message," Jane Bailey, DCUL executive vice president, told News Now.
 
At Tuesday's meeting, executives from the region's credit union leagues, including Delaware, New Jersey, Virginia, Ohio, West Virginia, Maryland/DC, Pennsylvania and California, met with NCUA Region II Director Jane Walters and her team to discuss credit union issues and NCUA hot topics.
 
Among the topics discussed were small credit union issues; new regulations; examination changes & trends; member business lending; credit union service organizations; foundations; enterprise risk management; supplemental capital; due diligence; proposed diversity standards and charitable accounts.
 
NCUA Region II's staff and state credit union associations meet twice a year to share information and address challenges in the region.
 
The next meeting will be held in West Virginia in June.

N.Y., Pa. Leagues Collaborate On IT

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ALBANY, N.Y. and HARRISBURG, Pa. (11/22/13)--The Credit Union Association of New York (CUANY) and the Pennsylvania Credit Union Association (PCUA) have finalized an agreement to collaborate on information technology support.
 
The initiative builds on previous collaborations between the two associations, including jointly hosted board dialogue sessions and volunteer conferences.
 
"Information technology is a critical function for any organization, and it's an area that can benefit greatly from shared expertise and resources," said William Mellin, president/CEO of CUANY. "Both of our associations are committed to delivering the maximum value possible to our member credit unions, and this partnership will help us achieve that goal."
 
CUANY and PCUA will collaborate on customized network administration, association management system support, helpdesk support, training and data backup/recovery.
 
"More and more credit unions are working together in their back office operations to achieve economies of scale, and both our associations recognize the value of this approach," said Patrick Conway, president/CEO of PCUA. "This is a progressive, unique model of league collaboration, and it's a great opportunity for us to increase efficiencies and reap the benefits of true cooperation."

Indiana CU Weathers Tornadoes

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KOKOMO, Ind. (11/22/13)--In her 42 years with Financial Builders FCU, Cindy Brock had never needed to put the credit union's disaster recovery plan into action. That changed Sunday when two tornadoes ripped through Kokomo.
 
The National Weather Service said the tornadoes hit wind speeds of 111 to 135 mph. Indiana reported no deaths, but Sunday's storms injured 32 people in the Kokomo area (Kokomo Journal Nov. 20)
 
Financial Builders single branch was damaged extensively. Brock, president/CEO of the credit union, believes most of the damage was caused by debris. A lobby sun-roof and other windows were broken, the credit union drive-through was rendered inoperable and other areas of the branch had water damage. Debris was strewn everywhere on the property and power was out throughout most of the area, Brock said.
 
When she first saw the damage, Brock thought the credit union would be operating out of a portable branch on at least a temporary basis.
 
"To be honest, I was just happy the building was standing, looking at the damage around us," Brock said. "The bank across the street was leveled. But they have other branches their customers can go to. This branch is all we have."
 
After consulting with her disaster recovery consultant, Agility Recovery, a CUNA Strategic Services provider, it was determined that the branch remained operable. The credit union arranged for delivery of a generator.
 
The credit union was closed Monday and Tuesday, but its lobby re-opened Wednesday morning. The drive-through remains closed.
 
"The generator got here Monday night," Brock said. "Tuesday we got the computers back up and running. We were able to open [Wednesday] morning. The thing I was most worried about was serving my members--and we had long lines Wednesday morning."
 
Insurance adjustors were at the facility Thursday morning. Brock doesn't yet have an estimate of when the damage will be fixed.
 
"Actually, we're very thankful our building is just standing," she said. "It happened on a Sunday afternoon, so no one was injured. Considering the amount of damage that Kokomo suffered we are very blessed."
 
 

N.J. Senate Passes Bill To Expand CU Advisory Council

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TRENTON, N.J. (11/21/13)--Legislation to expand New Jersey's Credit Union Advisory Council (CUAC) to seven members and provide for representation of federally chartered credit unions passed in the state Senate by a 30-0 vote.
 
The bill expands the CUAC from five members to seven. It designates that no fewer than four seats can be held by representatives of state-chartered credit unions, and no fewer than two seats can be held by representatives of federally chartered credit unions, said the New Jersey Credit Union League (The Daily Exchange Nov. 19).
 
The CUAC was established through legislation enacted in 1984 as a vehicle for state-chartered credit unions to advise state government on credit union-related matters. Members are nominated by the governor and must be confirmed by the state Senate.
 
In 2012, New Jersey credit unions worked for an amendment that preserved the CUAC and scrapped a plan to replace it with a Consumer Finance Advisory Board, where only two of nine seats would be held by credit union representatives.
 
This newest CUAC bill, passed Monday, recognizes that federally chartered credit unions, though primarily regulated by the federal government, are also subject to numerous state laws and regulations and should have a voice as well.
 
The bill has been sent to the New Jersey State Assembly for consideration there.  If approved, the final step would be for Gov. Chris Christie to sign the bill into law.
 
John C. Gibardi currently is chairman of the council.  Gibardi is a New Jersey state-chartered credit union member and president/CEO of Entertainment Industries FCU, which is based in New York City and has offices in Elizabeth, N.J., and Lyndhurst, N.J. He is serving a one-year term as chair.

Cheney, Matz Quoted in WSJ On Large RMBS Settlement

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WASHINGTON (11/21/13)--Credit Union National Association President/CEO Bill Cheney and National Credit Union Administration Chairman Debbie Matz each were quoted Wednesday in a Wall Street Journal article highlighting the U.S. Department of Justice's announcement that NCUA would receive $1.4 billion under the terms of a $13 billion settlement with JP Morgan Securities.
 
Lawsuits brought by the NCUA alleged JP Morgan oversold the quality of certain mortgage-backed securities (MBS's) it issued, which were sold to U.S. Central FCU, Western Corporate FCU and other corporates from 2006 to 2007. The corporates collapsed in 2009, and the NCUA, as their liquidating agent, sued a number of Wall Street firms that issued or underwrote the securities that the agency said contributed to the corporates' collapse.
 
"I think [the NCUA] absolutely should, on behalf of the credit unions, recover as much as possible," Cheney told the Journal.
 
Separately, Cheney also said Tuesday that the announcement gives even more weight to CUNA's recommendation that the Temporary Corporate Credit Union Stabilization Fund projected assessment range for next year be set at 0 basis points (bps). The NCUA is expected to discuss a projected assessment of 0 bps to 5 bps at its Thursday open board meeting (News Now Nov. 20).
 
NCUA Chair Matz told the Journal, in part, "In agreeing to this settlement, [J.P. Morgan] has taken a measure of responsibility for actions that caused severe damage to the credit-union system."

Tax Resolution Battle Continues in S.D.

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BISMARCK, N.D. (11/21/13)--South Dakota banks continued to push for a change to the credit union tax status--the same day the Brookings County Commission voted 4-0 to table a bank-backed resolution that would have supported taking the tax-exempt status away from credit unions and farm credit services earlier in the day.
 
Brookings City Commission Tuesday night voted 7-1 in favor of considering South Dakota banks' "tax equalization" resolution, said the Credit Union Association of the Dakotas (Memo Nov. 20).
 
Representing credit unions at the meeting were Chad Moller, branch manager, Dakotaland FCU, Brookings, and Jeff Olson, Credit Union Association of the Dakotas, vice president of advocacy and awareness.  Credit unions and farm credit services were provided about five minutes of rebuttal time.
 
South Dakota banks also expanded their tax battle to Yankton County Tuesday when they submitted a resolution proposal in support of taxation federal credit unions and farm credit system institutions. The Yankton County Commission took no action on the resolution and decided to table it for discussion at a later date. 

CU System Briefs (11/21/2013)

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  • PORTLAND, Maine (11/21/13)--Police nabbed three New Hampshire residents allegedly responsible for the October robberies of Ocean Communities FCU and Kennebunk Savings in Maine (Bangor Daily News Nov. 19). Daniel Barry, 38, of Pembroke, N.H., Marvin Eugene Ansteth, 40, of Somersworth, N.H., and Brianne Mone, 27, of Dover, N.H., were all charged with bank robbery by U.S. Attorney for Maine Thomas Delahanty. Prosecutors say that Barry held up both institutions at gunpoint, and that Anseth and Mone each drove the getaway car--with Mone having participated in the Oct. 26 Ocean Communities FCU heist in Sanford, Maine. The U.S. Attorney's investigation has led prosecutors to believe that Anseth was a getaway driver for two similar robberies in October, and that Mone drove a getaway car after an August bank robbery--all three of which are said to have happened in New Hampshire. Court documents filed by prosecutors claim that a man arrested on Oct. 31, Phillip Gage, had a role in all five robberies. Barry, Mone, and Ansteth face up to 20 years in prison if convicted. Ocean Communities FCU is based in Biddeford, Maine, and has about $150 million in assets ...
  • WICHITA, Kan. (11/21/13)--The April 3 fatal shooting of a man who was fleeing from a robbery at Wichita-based Credit Union of America was considered a suicide, according to an autopsy report. (The Wichita Eagle Nov. 19) Sedgwick County District Attorney Marc Bennet said on Tuesday that the findings showed Horace L. Gwyn, a suspect in the robbery, died of a self-inflicted gunshot wound as a county sheriff's deputy simultaneously shot him in the back. Bennett said the deputy's shot would not have been fatal and that his actions were justified because Gwyn allegedly shot first. Credit Union of America has more than $527 million in assets ...

Illinois CUs Aid in Tornado Recovery

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NAPERVILLE, Ill. (11/21/13)--Illinois credit unions continue to help their employees, friends and family members recover from Sunday's devastating tornadoes.
 
Latest estimates by weather officials show that at least nine tornadoes are confirmed to have touched down in Illinois Sunday--the highest number of tornadoes to occur in any one November weather event in the state on record, according to the Illinois Credit Union League.  To date, Illinois Gov. Pat Quinn (D) has declared 13 state counties as disaster areas. 
 
On Monday, CEFCU, Peoria, donated $100,000 to the Central Illinois Chapter of the American Red Cross, Central Illinois Tornado Relief. CEFCU maintains a branch in Washington, Ill., a town of about 15,000, and one the areas hardest hit by the tornadoes.
 
CEFCU has also set up Red Cross donation canisters all of its 20 Illinois member centers and is holding employee casual days to collect more funds.
 
Farther downstate, SIU CU, hosted a pizza lunch at its branch in Metropolis, Ill., which is about five miles away from where a tornado struck the town of Brookport.  The credit union sent an email blast to all of its members in that area and is calling each one individually to see how they are faring and see what type of assistance they may need.  So far, those needs include water and toiletries. 
 
SIU CU, Carbondale, Ill., also sent three employees to Metropolis to assist in the emergency supply relief effort, and provided cases of water for donation. Members can make monetary and other donations at all SI CU branches.
 
In central Illinois, Heartland CU, Springfield, Ill., contributed funds to a local radio station and will assist in filling a semi-trailer full of water for the people of Washington.  The truck will be sent back with the Washington High School football team after a state semifinal football game Saturday against Springfield Sacred Heart-Griffin. 
 
Heartland CU will also a jeans day for employees today to raise funds for storm relief in Central Illinois.  The money raised will be donated to the Red Cross.
 

CU System Briefs (11/20/2013)

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CU SYSTEM BRIEFS 11.20
 
 
  • LANSING, Mich. (11/20/13)--Johnathan Gallimore, chairman of Public Service CU, died of a heart attack on Nov. 10. Gallimore became a member of Public Service in 1953, and was elected to its credit committee in 1968. He was elected to the board in 1970, and rose to the rank of chairman in 1993. "His influence on the Public Service Credit Union family and members will be felt for years to come," PSCU President/CEO Dean Trudeau said. Gallimore was 81 years-old ...
  • ROCHESTER, N.Y. (11/20/13)--A 25-year old man was arrested Sunday for allegedly robbing a Summit FCU branch in Rochester, N.Y. (Rochester Democrat & Chronicle Nov. 18). Police detained Jimmy Nadal at about 2:40 a.m. (ET) on Nov. 17 after receiving a tip. Nadal was charged with third-degree robbery and fourth-degree grand larceny. He is accused of passing a Summit FCU teller a note demanding cash and then fleeing after taking an undisclosed amount on Nov. 15. Rochester Police Department's Major Crimes Unit is investigating the theft in tandem with the FBI. Summit FCU, based here, has over $693 million in assets ...
  • MIDDLETOWN, Pa. (11/20/13)--Credit unions in central Pennsylvania earlier
    Click to view larger image Click for larger view
    this month lent a hand raising money for Penn State Hershey Children's Hospital, a Children's Miracle Network Hospital affiliate. The fundraiser, a 28-hour radio marathon on Nov.7 and Nov. 8 sponsored by FM-105.7, The X Rocks, raised $126,863 to support treatment and programs offered to patients and their families. During the campaign, called "Pay 4 Play," listeners requested songs in exchange for donations. Mid-Atlantic Corporate FCU staff and other credit union representatives volunteered to work the phone banks for the radio station. "Pay 4 Play is a great event and a wonderful opportunity for central Pennsylvania credit unions to join forces and show our spirit of cooperation in action," said Erin Doan, chair of Mid-Atlantic Corporate community involvement committee. Pay 4 Play was started seven years ago and has raised $642,898 for local Children's Miracle Network Hospitals since its inaugural fundraiser. Mid Atlantic Corporate FCU, based here, is a wholesale lender and service provider that works with credit union service organizations, leagues, chapters, and more than 800 credit unions ...

Filene Study: Mortgage Writing Increases CU Performance

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MADISON, Wis. (11/20/13)--Credit unions that make more mortgage loans will be, on average, more profitable and grow more quickly, according to new research from the Filene Research Institute.
 
Filene states that credit unions hold a quarter of their assets in residential mortgages, and its report charts mortgage trends from the past three decades, revealing that these loans have "persistent positive effects on credit union performance."
 
The paper, Mortgages and Credit Union Performance: 1980-2011, documents how much the share of credit union assets held in mortgages rose in recent decades and estimates the size of the connections between mortgage share and credit union performance.
 
Findings from the study include:
  • Credit unions' direct holdings of mortgages grew rapidly over the past three decades, from only $3 billion in 1980 to $236 billion at the end of 2011. During that time, those holdings averaged 14% annual growth.
  • Mortgage holdings grew especially, at about 22% annually, during the 1980s. After the 1980s and until the financial crisis, growth slowed to 11%. From 2008 through 2011, nationally, credit unions still added mortgages at a 4% annual growth rate.
  • Credit unions' mortgage share rose fairly steadily from 5% in 1980 to 24% in 2011. On average, declines in mortgage share were rare and small, and occurred only when either macroeconomic or real estate conditions deteriorated considerably, as in the early 1980s and the early 1990s, and since the onset of the financial crisis.
  • As the number of smaller credit unions decreased and remaining credit unions grew in size, the percentage of all credit unions that held any mortgages rose from 17% in 1980 to 61% in 2011. By 2011, credit unions that held no mortgages accounted for only 3% of all credit union assets.
  • Averaged over the past three decades, individual credit unions that had more of their assets in mortgages had slightly higher returns on assets (ROAs) and higher inflation- adjusted asset growth.
  • On average, from 1980 to 2011, credit unions that boosted their mortgage share by 10% raised their ROAs by one basis point, they had higher costs as noninterest expenses per assets rose by nine basis points, and their inflation-adjusted assets grew nearly 1percentage point faster.
  • The effects of mortgage share on credit union performance were larger more recently. Beginning in 2000, instead of the average one basis point boost to ROAs that we estimated for the entire 1980-2011 period, a 10% increase in mortgage share raised ROAs by an estimated six basis points.
To download the study use the link.

Illinois CUs Share In Tornado Heartbreak

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MADISON, Wis. (11/20/13)--While central Illinois credit unions emerged remarkably unscathed from tornadoes that tore through the area on Sunday, they could not avoid the heartbreak that affected their employees, members and neighbors.
 
Click to view larger image At least 14 tornadoes struck Illinois and northwest Indiana Sunday, but the Illinois Credit Union League reported no damage to credit unions after reaching out to its members in central Illinois Monday and early Tuesday.
The Illinois Credit Union League reported no damage to credit unions after reaching out to its members in central Illinois Monday and early Tuesday. "As bad as the storms were, credit unions appear to come out of it relatively damage free," said Will Willie, league public relations coordinator "Most of the reports we received pertained to power outages and ATMs that were temporarily out of service."
 
At least 14 tornadoes struck Illinois and northwest Indiana on Sunday. Illinois Gov. Pat Quinn (D) declared six counties state disaster areas. The strongest of the tornadoes to hit Illinois slammed into the town of Washington near Peoria, where one person was killed.
 
A branch of CEFCU, based in Peoria, Ill., temporarily served as staging point for first responders and emergency personnel in Washington.
 
"Our branch was not damaged, and I think it served as a high profile location in the area until the responders could relocate to the local fire department, said Sue Portscheller, vice president of marketing for CEFCU.
 
At least seven CEFCU employees lost their homes in the tornadoes, Portscheller said.
 
Click to view larger image Seven employees of CEFCU, Peoria, were among the Illinois residents whose homes were destroyed in Sunday's tornadoes. (CUNA photos)
"Not only that, but we but we have really strong penetration in the severely impacted areas," she added. "Probably three out of four households are CEFCU members, so we are heartbroken, touched and involved with what's going on."
 
Three CEFCU branches were temporarily closed Monday due to power outages.
 
On Monday, CEFCU donated $100,000 to the Red Cross Central Illinois Tornado Relief Fund.
 
The credit union has also set up an emergency response team to help with members' financial needs. "Our plan was to develop a sort of one-stop shop with employees who are trained in multiple areas that can help members with whatever their needs are," Portscheller said. "Members are going to have to deal with mortgages, cars and lost account information."

CUAD Gets Bank-Supported Tax Resolution Tabled In S.D.

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BISMARCK, N.D. (11/20/13)--South Dakota's Brookings County Commission Tuesday voted 4-0 to table a bank-backed resolution that would have supported taking the tax-exempt status away from credit unions and farm credit services.  Speaking on behalf of South Dakota credit unions at the meeting were Dan Cumbee, CEO Dakotaland FCU, Huron, and Jeff Olson, president/CEO of the Credit Union Association of the Dakotas (Memo Nov. 19).
 
"The County Commission decided it was not in their realm of responsibility to consider an item that had federal implications," said Olson after the commission's decision.  "Simply put, we made our case that any resolution that the committee would support was an endorsement of one business over another.  By passing the proposed resolution asking Congress to repeal the tax exemption for credit unions, they in essence would be taxing 251,000 credit union members in South Dakota."
 
CUAD coordinated a state-wide response strategy in the week leading up hearing, organizing a postcard drop, buying media time, placing news articles and urging credit unions to attend the session.
 
Olson reported that credit unions showed great support at the meeting, with members and credit union professionals from Sioux Falls (S.D) FCU, Service First FCU, Sioux Falls, Dakotaland FCU and others from Brookings and the surrounding area in attendance.
 
"Given the fact that the South Dakota banking chair lives and operates a successful bank in Brookings, getting the county commission to kill the resolution is a big win for credit unions and credit union members in South Dakota," said Olson.

Travis CU Testifies On Small-dollar Loans Before State Banking Committee

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VACAVILLE, Calif. (11/20/13)--Representatives from Travis CU, Vacaville, Calif., recently testified before a California Senate banking committee about a new loan product geared towards helping the unbanked and underbanked Latino community.
 
Click to view larger image Travis CU Director of Corporate Communications Sherry Cordonnier, front, and Senior Vice President and Chief Loan Officer Stacy Fifield testify before the Senate Committee on Banking and Financial Institutions, which held an informational hearing on Thursday, Nov. 14, on various nonprofit and community based organizations with small dollar loan products. (Photo provided by California and Nevada Credit Union Leagues)
Travis CU's Director of Corporate Communications Sherry Cordonnier and Senior Vice President and Chief Loan Officer Stacy Fifield were invited to testify before the Senate Committee on Banking and Financial Institutions, which held an informational hearing on Thursday on nonprofit and community based organizations with small dollar loan products.
 
Travis recently finalized a small dollar lending pilot program, the New Era Tanda Loan Program. The pilot program debuted in mid-2012, in part through a grant received by the National Credit Union Foundation. It was designed in partnership with Coopera, a firm focused on the emerging Hispanic market, to help Latino participants develop a 12-month shared savings goal and to take advantage of the credit union's unique savings and loan offerings.
 
"We developed the program concept for this unique program centered on tandas (also known as cundinas, sans or quinelas)," Cordonnier said. "Tandas--informal borrowing/lending circles--are common in immigrant cultures, especially Latin American immigrant cultures. The modernized tanda, developed by TCU, aimed at bridging a cultural custom with the credit union experience.  TCU partnered with the Yolo Family Resource Center to conduct the pilot program. The program used a grassroots and culturally relevant approach tailored to the local Latino community."
 
The initial class consisted of six people, each of whom was encouraged to attend monthly financial literacy courses, all offered in Spanish.  Participants contributed on a monthly basis to a shared savings account and also received a group share-secured loan to help save for a down-payment on a vehicle. After completing the program, each qualified participant was eligible for a TCU credit-building credit card and/or auto loan.
 
One of the goals of the program was to build Hispanic members' credit and good financial habits through financial education, Cordonnier said.
 
Travis CU found, via pre- and post-surveys, tjat those who participated were more likely to use online banking, bill pay, checking accounts, ATM/ debit cards, credit cards, savings accounts and direct deposit than they were prior to the program. They were also more likely to balance a checkbook, cash checks, and use a personal budget, Cordonnier said.
The Credit Union National Association and credit unions are committed to providing safe and affordable alternatives to predatory payday lenders. Loans from federal credit unions are generally limited to an annual percentage rate of no more than 18%, although there is some flexibility under the National Credit Union Administration's short-term, small amount loan program. That program permits federal credit unions to charge an interest rate that is a maximum of 10 percentage points above the established usury ceiling at that time. For now, this amounts to an interest rate ceiling of 28%. Most credit unions offering payday loan alternatives also limit fees, provide member financial counseling, and encourage members to open savings accounts.

CU Staff's Generosity Lifts Member After Setback

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TORRINGTON, Conn. (11/20/13)--Like her co-workers at $38 million-asset
Click to view larger image (Left to right): TMTFCU's Mike Denza, Mike Allen, Therese Pavan, Suzette Barker, Dawn Pawlow, Brooke Gunther, and Ilma Sabolik stand under the credit unions' "People Helping People." (TMTFCU Photo)
Torrington(Conn.) Municipal & Teachers FCU (TMTFCU), front line staffer Suzette Barker enjoys engaging members in conversations. That extra effort on Barker's part gave the credit union a chance recently to go "above and beyond" for a member in need.
 
Many times, members simply reply politely to Barker about that day's to-do list, an upcoming birthday, or a development around town.  But in one instance, Barker's pleasant greeting prompted a member to share a painful episode that had put her family in a tough spot.
 
According to the Credit Union National Association's Credit Union Front Line Newsletter, the member told Barker she was moving to a new apartment with her two young girls as part of a much-needed fresh start. She purchased new bedding, new furniture, and a few back-to-school items, and left them overnight in the apartment along with some other family possessions.
 
She returned the next day to find someone had broken into her apartment, stolen many of her belongings, and damaged or destroyed much of what remained. Worse, the member had
yet to purchase renter's insurance.
 
Understandably, the setback devastated the woman. She wasn't sure whether she wanted to move into the apartment complex anymore, even though she'd spent two years on a waiting list.
 
"She'd been through some hard times, and it was just unfair," Barker says.
 
The member wasn't asking for any help, according to Barker, but was merely opening up about her situation. CEO Donna Marie Battistoni and a group of TMTFCU employees consoled her.
 
Later, a colleague suggested the credit union take up a collection on the member's behalf. Barker received contributions from employees and the board.
 
"Suzette's a great example of the credit union philosophy of people helping people, and the staff and board of TMTFCU were happy to follow her lead," says Nancy Sieller, the credit union's chief operating officer.
 
With the proceeds, TMTFCU purchased a $300 Walmart gift card to help the member replace some of her belongings.
 
"She was so appreciative, you knew you did good," Barker says.
 
CUNA's Credit Union Front Line Newsletter asks credit unions to send their stories about front-line staff who went "above and beyond" to: cufrontline@cuna.com.
 
Use the resource link to subscribe to the newsletter.

Midwest CU's Auto Loans Now Certified 'Female Friendly'

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NORTH CHICAGO, Ill. (11/20/13)--A credit union in the Midwest has taken a new route to members service and has teamed up with a website that advises female car-buyers and certifies consumer automotive outfits as being friendly to women.

Great Lakes CU (GLCU) here announced last week that loan officers have completed a course issued by that website, AskPatty.com, making it the first credit union to receive credentials from the website. The credit union, which has 13 locations in Illinois and Wisconsin, is also entering into an AskPatty.com marketing support program and year-round training courses geared toward building stronger long-term relationships with women members.

The credit union said that its website will soon feature services geared towards women interested in auto loans, which include credit pre-approval, information about monthly payments, financing options and other resources that women car loan-applicants frequently request.

Susan Malo, GLCU assistant vice president of business development, said that the credit union first considered teaming up with the website last year, when it held its first annual "Chicks, Cars and Cupcakes"--a gathering held to give women car-buyers a leg-up. AskPatty CEO Jody DeVere was the keynote speaker at the event.

DeVere founded the site in 2005 to empower women looking for information about consumer automotive products and services. She has said that women are buying more than 60% of cars these days, and 85% of the decision of what model and make is brought into a household is made by women. She said that this means dealers need to find ways to "connect with us, and it's not by making things pink and treating us like we're less intelligent (Chicago Tribune Feb. 3, 2011)."

GLCU's Malo said that based on the success of that 2012 symposium and one held on Oct. 5, she asked DeVere if it would be possible for GLCU to become the first credit union to receive AskPatty certificaition. DeVere agreed, and AskPatty tailored its auto-loan certification process to meet the needs of a credit union.

Malo told News Now that while it's tough to gauge just how GLCU members are responding to the partnership, with it having just been announced last week, she did note that the initial press release received 30,000 impressions--a measure of page views. She also said GLCU will be tracking its loan volume to determine the extent to which the partnership is having an impact on female auto-loan customers.

While GLCU does have financial services geared toward certain types of consumers, like student loans, this is its first targeted auto-loan marketing and service program.
AskPatty.com also certifies car dealers, tire dealers, collision centers, and car service and repair centers.

CU System Briefs (11/19/2013)

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  • SEATTLE, Wash. (11/19/13)--Verity CU announced Friday that current Executive Vice President John Zmolek will become its new president/CEO in the new year. The Seattle-based credit union's board of directors approved unanimously of Zmolek's appointment. "I'm excited to continue Verity's mission of enhancing members' lives through exceptional financial services," Zmolek said. "We have come through the recession in a good position to grow and enhance our products and services." Zmolek first joined Verity as a board member in 1986 and became chief financial officer in 1990. He has also served as the credit union's chief lending officer, its head of information technology, and as president of CU Home Mortgage Solutions, a mortgage services provider to Verity and other credit unions in Washington. Zmolek has also served on the regional board of the Credit Union Executives Council and is involved with a variety of non-profit organizations. Incumbent CEO William Hayes is retiring on Dec. 31, after serving the credit union for 34 years ...
  • VANDALIA, Ohio (11/19/13)--Abbey CU President/CEO Lynn Cook announced Monday that she will retire at the end of March (Dayton Business Journal Online Nov. 18). The credit union's board said it will soon launch a search for a replacement. Abbey is the 11th largest credit union in the Dayton, Ohio region by deposit market share. Based here, it has $82 million in assets and operates three branches. "It is never an easy decision to retire," Cook said. "I just hope my guidance and management decisions have brought a great deal of value to our community, families and the members of Abbey CU over the years." She has served Abbey for 21 years ...

Study: CUs Still Beat Banks on Overdraft Fees

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MADISON, Wis. (11/19/13)--A new study from GoBankingRates.com reveals that a single checking overdraft fee can wipe out a year's worth of deposit interest. But on the bright side, the study also shows credit unions offer higher rates and lower overdraft fees on average than banks.
 
In its latest study, GoBankingRates.com compared the cost of overdraft fees against 2,781 checking account interest rates today, to determine the real return that depositors can expect to earn.
 
On the national level, average checking account rates stand at 0.27% annual percentage yield. Credit unions continue to demonstrate their ability to offer depositors higher average checking account returns, with rates at 0.32% APY compared with a 0.26% APY for banks.
 
Comparing average checking account interest rates with overdraft fees by region, GoBankingRates.com found depositors can expect to lose between 96.67% and 145% of their return on a $10,000 deposit with a single overdraft.
 
The national median overdraft fee stands at $30 for 2013, according to Moebs Services. Median bank overdraft fees are also $30, while credit unions charge $28 for an overdraft.
 
But just one overdraft can easily reverse customers' returns. The GoBankingRates.com study revealed that one overdraft in the course of a year equals 111.11% of a depositor's annual return, meaning that one misstep can not only jeopardize interest earnings, but also cut into principal deposits.
 
The Consumer Financial Protection Bureau (CFPB) issued a report on financial institution overdraft protection plans and continues to gather information about the variety of programs offered and how they affect consumers' ability to anticipate and control their costs for financial services.
 
For credit unions, the Credit Union National Association points out,  overdraft protection and 'courtesy pay' are designed to be a service to their consumer members, who have asked that they have continued access to such programs.
 
Given that credit unions are member-owned financial services providers, credit unions strive to develop these programs in such a way the costs can be covered for the programs, but at reasonable fees for the members requesting the service, CUNA has noted.
 
Importantly, GoBankingRates.com underscores that overdraft fees are controllable and avoidable by the account holder.

Harriet May To Be 2014 Co-op Hall Of Fame Inductee

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WASHINGTON (11/19/13)--Credit union movement luminary Harriet May will be rewarded for her four decades of service when she is inducted into the 2014 Cooperative Development Foundation's (CDF) Cooperative Hall of Fame on May 7.
 
Click to view larger image Harriet May is shown here as she addresses the 2012 Credit Union National Association Governmental Affairs Conference as she prepares to exit the CUNA board chairman post. (CUNA Photo)
May is a former president/CEO of Government Employees CU, El Paso, Texas,  and a former Credit Union National Association board chairman. Upon her retirement from GECU, she was named president emerita.

Rural utilities leader Martin J. Lowery, international leader Papa M.D. Sene and cooperative financer Barry Silver will also be inducted during the 2014 Cooperative Hall of Fame Dinner and Induction Ceremony at the National Press Club.
 
"The roster of the Cooperative Hall of Fame tells the story of the U.S. cooperative community through the lives and accomplishments of extraordinary individuals. Induction to the Cooperative Hall of Fame is reserved for those who have made genuinely heroic contributions to the cooperative community," CDF Board Chair Gasper Kovach, Jr., said.
 
May began working at Government Employees CU in 1974 and was promoted to CEO in 1996. During her tenure, May helped GECU double its asset size to more than $1.8 billion with more than 300,000 members. Under her leadership, GECU deployed about $125 million into the community each year.

CDF in a release noted May's "standout cooperative leader at the state, national, and international levels," and her work to make home ownership available to lower income, minority members of her west Texas community. This was done through the establishment of an Affordable Housing Credit Union Service Organization that has provided countless workshops, helped open first-time savings accounts and provided $8 million in total down payment assistance and $23 million in total mortgage loans.
 
CUNA also looked to May in the past to valiantly defend the tax status of the U.S. credit union movement, CDF added.
 
Other awards May has received in her career include:
  • The National Credit Union Foundation's Herb Wegner Memorial Award for Individual Achievement;
  • The World Council of Credit Unions Distinguished Service Award;
  • Recognition for her leadership in supporting the Network of Latino Credit Unions and Professionals; and
  • The National Federation of Community Development Credit Unions' Annie Vamper "Helping Hands" Award.

DHCU's CashBack Offers Returns

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MOLINE, Ill. (11/19/13)--Moline, Ill.-based DHCU Community CU's CashBack Checking, an account that pays members each time they use their debit CheckCard and Visa cards, has produced big returns, paying back members $58,000 in October, the first month of the program.
 
More 60% of checking account members are discouraged by pricing and fee changes on checking account, according to Raddon Financial Group, a financial research provider based out of Chicago. Of those, 25% are upset with fees associated with having a checking account, not maintaining a minimum balance in the account. DHCU is taking an out-of-the-box approach by rewarding member for using their 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.
 
The program includes both signature and PIN debit transactions. There is no minimums set on the number of transactions and no cap on how much a member can earn through the program.

NCUF Dinner Sponsorships And Tickets Available

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MADISON, Wis. (11/19/13)--Sponsorships and tickets are available for the next National Credit Union Foundation dinner presenting the Herb Wegner Memorial Awards.
 
The 26th annual dinner will take place on Feb. 24, 2014 in conjunction with the Credit Union National Association (CUNA) Governmental Affairs Conference (GAC) in Washington, D.C.
 
Denise Gabel, chief operating officer of the Northwest Credit Union Association, will return as the evening's master of ceremonies. There are a variety of new sponsorship and ticket levels for this premier event. The deadline to purchase tickets is Feb. 1.Use the link to purchase tickets or sponsorships.
 
"I've joked that this is the credit union system's version of the Oscars, but the Foundation Dinner and accompanying awards presentations are truly inspiring and energizing," said Gigi Hyland, NCUF executive director. "You won't want to miss the 2014 Foundation Dinner which will honor and celebrate four outstanding Wegner Award winners."
 
The awards ceremony celebrates the highest national honors in the credit union movement. The 2014 honorees are:
  • Lifetime Achievement: Gary Oakland, retired president/CEO, BECU, Seattle;
  • Lifetime Achievement: Jim McCormack, president/CEO of Pennsylvania Credit Union Association;
  • Lifetime Achievement: Tim Haegelin, retired president/CEO of Generations FCU, San Antonio; and
  • Individual Achievement: Sarah Canepa Bang, president/COO of CO-OP Shared Branching--FSCC, LLC and chief strategy officer of CO-OP Shared Branching.

Minn. Dept. Of Commerce Commissioner Visits Student Branch

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OWATONNA, Minn. (11/19/13)--Minnesota Department of Commerce Commissioner Mike Rothman visited HomeTown CU's student-run branch at Owatonna (Minn.) Senior High School (OHS) on Nov. 12 as part of his statewide financial literacy outreach tour.
 
Click to view larger image As part of his statewide outreach tour, Minnesota Department of Commerce Commissioner Mike Rothman visited HomeTown CU's student-run branch at Owatonna High School. From left, Dave Snyder, Asset Building Coalition; Minnesota Commerce Commissioner Mike Rothman; Chad Ohl, Owatonna High School business teacher; Kaitlyn Seykora, OHS student worker; Scott Pierce, OHS business teacher; and Jack Livingston, OHS student worker. (Photo provided by Minnesota Credit Union Network)
During the visit, Rothman recognized the positive impact of the long-standing partnership between Owatonna Senior High School and HomeTown CU, based in Owatonna. The relationship gives students the opportunity to gain valuable experience by working at the branch while also learning about personal finances.
 
"This program just makes sense," said Rothman. "It's a good way for kids to start to learn about their finances."
 
Rothman also met with OHS principal Mark Randall, business teachers Scott Pierce, Chad Ohl and Tate Cummins, HomeTown CU Youth Education Supervisor David Dorsett and student workers Kaitlyn Seykora, Jack Livingston and Abbie Matson. Their discussion centered on the importance of starting financial awareness at an early age and how the student workers have shared that message with their peers.
 
"We've been hiring student interns to work at our other branches for the last 20 years," said Marian Murphy, vice president of business growth at the credit union. "They are trained and treated like any other credit union staff member."
 
The OHS branch, which opened in Sept. 2011 was the first student-run branch to launch in Minnesota.

CU System Briefs (11/18/2013)

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  • HARRISBURG, Pa. (11/18/13)--The Pennsylvania Credit Union Association and its charity arm were honored Thursday by state legislators for supporting an organization called Junior Achievement (Life is a Highway Nov. 15). Sen. Rob Teplitz (D-15), and Reps. Mauree Gingrich (R-101) and Sue Helm (R-104) gave the Pennsylvania Credit Union Foundation three legislative citations in a ceremony at the Giant Center in Hershey, Pa. Elizabeth Ackerman, a coordinator for Junior Achievement, also presented the PCUF with a Donor of the Year Award. On behalf of PCUA, PCUF and state credit unions, foundation Executive Director Joe Wambach (center) accepted the honors. He is shown with Teplitz (left) and Gingrich (right). Wambach praised state credit unions' employees for volunteering thousands of hours to Junior Achievement volunteer teaching programs and its Men's and Women's Symposium. Since 2003, the foundation has given more than $100,000 to Junior Achievement, and individual credit unions have contributed tens of thousands of dollars. (Photo provided by the Pennsylvania Credit Union Association) ...
  • PITTSBURGH, Pa. (11/18/13)--A 59-year old woman was sentenced Thursday by a federal judge to 10 months in prison followed by three years of probation after she pleaded guilty to embezzling more than $100,000 from a church-affiliated credit union (WFMJ.com Nov. 14). Victoria Rozanski, of Elwood City, Pa., admitted in July that she siphoned funds from Holy Redeemer Parish FCU between 2003 and 2009. The judge ordered her to pay back $118,000 to Freedom United FCU, which absorbed Holy Redeemer--an institution that was based out of a 10-square foot room and only open for three hours a week (News Now May 3). When it was acquired by Freedom United FCU last year, Holy Redeemer had 234 members and nearly $630,000 in assets. Freedom United, based in Rochester, Pa., has $49.1 million in assets ...

CUNA Lending Council White Paper Discusses Merchant Lending

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MADISON, Wis. (11/18/13)--With merchants and consumers mainly relying on credit cards with terms credit unions can easily beat, the market opportunity for indirect merchant lending is plentiful, according to a new white paper from the CUNA Lending Council.
 
Through indirect merchant lending, credit unions can provide members with loans when and where they need them, expand their lending portfolios and acquire new members, according to the white paper, "Indirect Loan Opportunities."
 
From an operations perspective, the components of merchant lending are familiar to credit unions. Back-end processing is the same as with unsecured personal loans. Members or potential members will still be price and payment sensitive to varying degrees. A different kind of risk does exist when acquiring loans from a merchant; credit unions replicate much of the risk protection practices from indirect auto lending, the paper said.
 
Merchant lending is unique in several ways:
  • The loans are often small. While big-ticket items aren't out of the norm, more partners deal in smaller dollar products. As a result, programs plan for a higher volume of smaller loans or for merchant lending to be a smaller part of their lending portfolio.
  • The merchants also tend to be smaller and potentially less stable. This increases the need for good due diligence, but don't overdo it, the paper advised. The risk is ultimately with the person making the payments.
  • The competition isn't another lender offering similar terms. It's usually some kind of credit card. This significantly reduces the competitive rate environment.
  • Credit unions have an opportunity to educate--and even "wow"--potential partners. Retail stores and service providers are often unaware of how much a credit union can help their business and their customers. They might not offer financing. They might dislike the financing they do offer and wish they had an alternative, the report said.
 To download the whitepaper, use the link.

Express CU Teams With Seattle On Fin. Empowerment Centers

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SEATTLE (11/18/13)--Express CU, Seattle, is participating in a new program designed to alleviate poverty in Seattle by helping vulnerable consumers gain fundamental financial skills.
 
A $1.8 million grant from The Paul G. Allen Family Foundation will help launch six Financial Empowerment Centers in 2014, including a full-time central hub and five satellite locations throughout the Seattle. At the centers, clients will get free one-on-one financial coaching and lessons in financial know-how, such as paying down debt, increasing savings and improving credit.
 
Express CU, with $10 million in assets, will provide tellers for the empowerment centers, Sharon Hall, Express CU president/CEO told News Now Friday. The credit unions has provided community teller services to various city of Seattle social service agencies since 2009, she said.
 
The city of Seattle, which was the direct recipient of the grant from the Paul G. Allen Foundation, asked Express CU to provide teller services for the program, Hall said.
 
Low-income consumers will use the centers to build credit and clean up their financial histories, Hall said. "While they are there, they can have access to our products and services," Hall said. "We have products that help them build their credit, and we have savings accounts and unbundled checking accounts and other types of services that reduce financial barriers."
 
Express will be the only financial institution at the Seattle Financial Empowerment Center hub and satellite offices, Hall said.
 
The credit union will provide a full-time teller at the financial empowerment center hub and mobile tellers at the satellite centers.
 
Participation in the program reflects Express CU's commitment to serving the low-income members of the community, Hall said. Express CU is a community development financial institute and a low-income designated credit union--which means more than 50% of its membership is designated low income.
 
In October, Express CU received a Technical Assistance grant from the U.S. Treasury Department's Community Development Financial Institutions Fund. Technical Assistance awards can be used for purchasing equipment, paying salaries and benefits, and training staff and boards.
 
"We are fully committed with the support of the community," Hall said. "The community wants this to happen."

CUs Provide Typhoon Relief, State Warns Of Charity Scammers

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MADISON, Wis. (11/18/13)--Credit unions and state leagues are providing disaster relief to victims in the Philippines impacted by Typhoon Haiyan, one of the most powerful storms ever recorded.  However, one state is warning that scammers are taking advantage of the kindness of people by setting up fake charities.

While relief organizations are ramping up efforts to raise funds for victims, the Wisconsin Department of Financial Institutions warned  citizens about scams. "In times of such a tragedy, legitimate relief organizations aren't the only ones that ask for donations," warned the DFI, which regulates state-chartered credit unions and banks.

"Unfortunately, scammers and charlatans are quick to prey on the good intentions of potential donors," said DFI Secretary Peter Bildsten. He encouraged Wisconsinites "to make sure their donations are being made to a reputable charity."

Credit unions and leagues are stepping up with donations to the movement's international charity arm, the Worldwide Foundation for Credit Unions for its International Disaster Relief Fund. The World Council of Credit Unions, which says 1,320 credit unions serve roughly 3.2 million members in the Philippines, is in contact with authorities there to determine how best to assist the victims.  It worked closely with Philippine credit unions from 2007 to 2010 in a partnership that focused on model credit union building and institutional branding.

The Northwest Credit Union Foundation has committed $5,000 to the international relief effort, said the Northwest Credit Union Association (Anthem Nov. 14). NWCUF Executive Director Kim Vu urged credit unions in the Northwest to donate.  "Credit unions here and in the Philippines have had a special relationship for years, including a partnership with the Washington Credit Union League in the mid-2000s," she said.

The Cornerstone Credit Union Foundation Board of Trustees approved a $3,500 donation to the relief fund, said the Cornerstone Credit Union League (Leaguer Nov. 12). "Our hearts go out to everyone who has been impacted by typhoon Haiyan," said Cornerstone foundation Executive Director Courtney Moran. "They have a long road to recovery ahead of them, and just as the credit union community has come to our aid when hurricanes, fires, flooding and tornadoes have devastated our region, we are here to help our credit union family in the Philippines."

The Pennsylvania Credit Union Association and Pacul Services, Inc., each pledged $1,000 donations, and the Pennsylvania Credit Union Foundation will make a $2,000 donation, as well (Life is a Highway  Nov. 13). "It is heartbreaking to see this massive devastation and the Philippine citizens suffering from this terrible disaster," said Jim McCormack, in one of his last acts before retiring as PCUA president/CEO. "The credit union community is known for its People Helping People philosophy and contributions are needed to provide resources to help credit union members and employees rebuild their lives."

Credit unions also are finding ways to enlist their community's help in assisting the victims.  For example, Redwood CU, Santa Rosa, Calif., is accepting contributions to the American Red Cross' International Relief Fund.  All 18 RCU branch locations are designated as collection sites for donations from members and nonmembers in the community.  The collection drive "is our way of offering assistance and responding to the requests of members who would like to help," said Brett Martinez, RCU president/CEO.

Typhoon Haiyan, which struck Nov. 8, killed at least 3,633, although death estimates are expected to be as high as 10,000. It injured at least 12,487, with 1,179 people listed missing (CNN.com Nov. 15). Nine million people were impacted in 44 provinces, 536 municipalities and 55 cities. Hardest-hit was Tacloban City, the capital of the Leyte province. Roughly two million people are displaced. Of those, 400,000 are in shelters.

To support the international credit union disaster relief fund and rebuilding of Philippine credit unions, donations may be sent via check, credit card or wire to:

Worldwide Foundation for Credit Unions Inc.
5710 Mineral Point Road
Madison, WI 53705, USA.

Individuals may donate with a credit card online by using the link. For additional information, contact: Calyn Ostrowski, foundation director at 608- 395-2056 or e-mail  costrowski@woccu.org. Contributors should indicate the donation is designated for Philippine Disaster Relief Fund.

Data Breach At Card Processor Impacts CU In Idaho

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SANDPOINT, Idaho. (11/18/13)--Computer hackers appeared to have breached the database of a large retailer's third-party card processor, stealing card information from at least one Northwest credit union and compromising member accounts.
 
Horizons FCU, Spokane Valley, Wash., was notified of the breach by its card processor, Vantiv, about 10 days ago. Since then more than 100 members have reported fraudulent charges, Horizon CU President/CEO Jeff Adams told News Now Friday.

The retailer has not been identified, Adams said.
 
The cybercriminals have "been moving from state to state and making charges at major retailers," Adams said.  
 
The credit union has been blocking and reissuing cards on a case-by-case basis, Adams said.
 
Other financial institutions are almost certainly affected, Adams said. "We know that there are multiple financials, credit unions and other FIs, that are affected," he said, adding that the card batch from a large retailer "is typically credit unions, banks, the whole gamut of financial service providers."
 
Police in Idaho, where Horizon CU has four branches, have also reported instances of credit card fraud (Bonner County Daily Bee Nov. 15). Sandpoint (Idaho) Police Department Chief Corey Coon said it's unclear if members and customers of other credit unions and banks in the area are being affected because those institutions may not require a police report case number when fraud is reported, but handle them through a security company.
 
Coon recommended that credit card holders carefully watch their account statements for fraudulent charges and report any suspicious activity.

Vermont CUs OK Dues Formula Change

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SOUTH BURLINGTON, Vt. (11/18/13)--The Association of Vermont Credit Unions approved a new schedule of dues proposed by its Board of Directors.
 
Member credit unions voted 35-1 to amend the AVCU's bylaws on Wednesday. As a result, each AVCU member will pay dues calculated by a formula based on the square root of its assets, starting in 2014. Between 2014 and 2017, however, no single credit union's dues will fluctuate by more than 25%.
 
About 20 other state credit union leagues charge dues in proportion to members' assets.
 
For the first time in AVCU's history, the ballot was conducted online through a secure service, with each delegate required to register to receive a unique identifier that expired after the vote.
 
The AVCU Board of Directors announced in September its proposal to reform the trade association's fee schedule in September, with discussions over the issue progressing via e-mails and webcasts.

CUNA Sets Record Straight On CU vs. Bank Exec Compensation

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WASHINGTON (11/18/13)--The Credit National Association is setting the record straight on the issue of credit union CEO vs. bank CEO compensation after the American Banker cited a statistic that is "misleading," said CUNA.

A Nov. 13 item in the Banker titled "Banks Trail Credit Unions In Exec Pay, Loan Growth, Political Clout" cited an enetrix study that claimed the median base salary of credit union CEOs is higher than that of bank CEOs.  (enetrix is a division of Gallup, Inc.)

The Banker failed to note one of the study's key points on page 14: that payout from bonuses and stock options, which are far more valuable than base salary, are not available to credit union CEOs, since they are member-owned cooperatives.

The American Banker claim is "very misleading," said Paul Gentile, CUNA's executive vice president of strategic communications and engagement. He noted the comparisons in the section of the study include only base salary--not long-term incentives provided to bank CEOs such as yearly bonuses, stock grants and stock options.

"When credit union CEOs end their careers, they have nothing to cash in because the members own the whole credit union," said CUNA Chief Economist Bill Hampel.  He pointed out that with the increased scrutiny given to CEO salaries, banks have moved more toward other forms of raising compensation levels rather than base salary: Historically, on a like-size basis, CUNA compensation studies have consistently shown credit union CEO compensation is reasonable. 
 
The studies also consistently have shown, Hampel noted, that bank CEO compensation is substantially higher than credit union compensation. More recently, he said, this has changed for some size groups--not because credit union compensation has increased substantially, but apparently because bank non-stock compensation has declined dramatically. CUNA's current comparative data shows a nearly 25% decline in bank non-stock compensation compared to the 2006 norm. 
 
"We believe it is incredibly unlikely that total bank CEO compensation--including stock--has declined by 25% over the past five years.  It simply defies logic," Hampel said.
 
Instead, he added, what has likely happened is that in the wake of the financial crisis and Dodd-Frank Act reforms, bank CEO base pay has become a substantially less prevalent component of total bank CEO compensation while other forms of compensation such as restricted stock grants have become a substantially more prevalent component.  Favorable accounting and income tax rules for restricted stock has helped to fuel this trend. 
 
Hampel noted, "If bank CEO compensation is similar to other small corporations, then cash compensation represents only 40% of the total, and a bank CEO earning $250K in base pay--typical in the $500 million to $1 billion asset range--would have total compensation of over $600k--well above the credit union average in every asset-size category we track."

Hampel charged that the American Banker article "magnifies and gives further credence to the false impression it has created by quoting a banker who claims that, 'Credit unions are paying their folks more than two times what I pay mine.'" However, the enetrix study also shows that, across all asset classes, credit union median total compensation for most key senior executives is substantially lower than bank median total compensation. 
 
However, in today's complex financial environment, compensation for CEOs must be sufficient to attract talent needed to manage financial institutions that in many cases offer a complete menu of financial services and act as stewards for their member savings, Hampel said.

Harborstone, State Rep. Take Advocacy On The Road

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TACOMA, Wash. (11/18/13)--In Tacoma, Wash., Harborstone CU has set out to prove that credit unions must stand up for themselves so they don't lose their tax status and go out of business. How? By taking advocacy on the road, with a state lawmaker.
 

During October and November, the credit union's Governmental Affairs Roadshow stopped at every one of Harborstone's 17 branches in Washington. Its goal: Make sure that every employee, at every branch, understands the structure, value and impact of the credit union movement (Anthem Recap Nov. 15).
 
"We believe that every credit union employee should be able to fully articulate the importance of credit unions, understand the reasons why credit unions have an income tax exemption, and expertly explain these ideas to our membership," Vicky Nelson, Harborstone's business sales and services manager, told the Northwest Credit Union Association.
 
She and Harborstone President/CEO Phil Jones developed the idea to motivate employees to become advocates.
 
State Rep. Steve Kirby (D-29), who is chairman of the House Business and Financial Services Committee and a business sales and service specialist at Harborstone, agreed to talk to employees about his role in the legislature and how he supports credit unions.
 
Nelson also recruited NWCUA's vice president for legislative affairs, Mark Minickiello, to discuss "the big picture" of governmental affairs and the grassroots efforts of the national "Don't Tax My Credit Union" campaign.
 
During the 30-minute Roadshows, Nelson addresses:

Washington State Rep. Steve Kirby, who is also a business sales and service specialist at Harborstone CU, Tacoma, Wash., and Vicky Nelson, Harborstone's business sales and services manager, head out for a Governmental Affairs Roadshow that stops at all 17 branches of the credit union to make sure every employee understands the structure, value and impact of the credit union movement. (Photo provided by the Northwest Credit Union Association)

The Roadshow "is an important part of our ongoing advocacy efforts to first educate ourselves to understand what a credit union is and the reasons credit unions have an income-tax exemption," Nelson said. "Only then will we be able to fully articulate the importance to members."
 
Beyond the Roadshow, Harborstone provides articles with basic questions, and devotes a website page to its advocacy theme, "Protect your financial right to choose." It also posts educational messages once a week to Facebook and Twitter.
 
"Rarely do you see this level of engagement by a credit union," said NWCUA's Minickiello. "I'm asked a few times a year to speak to boards of directors or management of a credit union...but never...to visit branches and educate frontline staff." It is even rarer to get the opportunity for frontline staff to hear from a professional credit union advocate and a sitting legislator.

  • The difference between credit unions and banks;
  • Why it's important for the credit union to participate in advocacy;
  • What lobbyists are, what they do, and why developing and maintaining relationships with credit union friendly legislators, including the need for campaign contributions, is important;
  • What the acronyms PAC and CULAC mean; and
  • Why it is crucial to nurture informed and educated communication about governmental affairs between Harborstone employees and members.

CU System Briefs (11/15/2013)

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  • WEST MILWAUKEE, Wis. (11/15/13)--A suspicious package left by a robber during a holdup of a West Milwaukee, Wis., branch of Landmark CU Wednesday was not a bomb.  Members of the Milwaukee County bomb squad were called to the credit union after it was robbed. The squad deployed its explosive ordinance disposal robot and determined the package to be nothing dangerous.  No other details about the robbery were released (CBS58.com Nov. 13) ...
  • RIVERSIDE, Calif. (11/15/13)--Altura CU has rolled out a new Credit Builder Loan to assist people who need to rebuild their credit score, the Riverside, Calif.-based credit union announced.  During the recession, a disproportionate number of people in the area could not pay their bills, and their credit scores dropped dramatically, said the $689.4 million asset credit union. With the loan, individuals, even those with low scores, can borrow up to $3,000 at a competitive rate. The borrowed funds are placed into a share certificate. Once the loan is paid off, the borrower has access to the funds. "Altura created this loan as a way to offer people a lifeline and an opportunity to rebuilt their score and move forward," said Jennifer Binkley, chief operating officer at Altura. "We look at a low credit score and see an opportunity to help." ...
  • LAUREL, Md. (11/15/13)--Tower FCU joined more than 1.9 million businesses, organizations, families and individuals in southeastern U.S. for the Great American ShakeOut Earthquake Drill on Oct. 17. The drill was held at Tower's Laurel, Md., headquarters. Before the event, the credit union disbursed cardboard boxes around each floor of the building to simulate fallen pictures, broken glass and shifted equipment. During the event, Tower employees dropped to the floor, took cover under a table or desk and held on to the furniture until the "shaking" stopped. They then evacuated the building.  In August 2011, a 5.8 magnitude earthquake in Virginia was felt in Maryland and shook Tower's building in Laurel, but no one was injured and no damages were sustained. "While we hope to never use these skills, it is better to know what to do in case of such an emergency," said Bill Grantham, Tower's vice president of facilities and administrative services ...

Dallas FCU Scavenger Hunt Educates About Products/Services

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FARMERS BRANCH, Texas (11/15/13)--Easter came early for the members of a credit union in Dallas, Texas, this year.
 
As part of a promotional effort, the $45 million asset Dallas FCU staged a virtual scavenger hunt on its website, enticing members into searching for 10 hidden puzzle pieces online--or Easter Eggs, in programming parlance.
 
The credit union hid the pieces--pictures of automobile parts--on a variety of pages on its website, and promised that members who found all 10 would be entered into drawings for a $1,000 cash grand prize, and 10 $100 gift card prizes (Leaguer Nov.12).
 
Dallas FCU representatives told the Cornerstone Credit Union League that the promotion drew in 330 players, 5% of the credit union's membership, and led to a spike in website traffic--a 19% increase in unique visitors and a 41% increase in page views.
 
Other parts of the website saw different increases during the promotion. Pages that spiked in traffic included:
  • The membership and member testimonials, by 1,217%;
  • "About" page, by 321%;
  • Loan rates, by 144%;
  • Loans and credit cards, by 130%; and
  • Apply online, by 119%.
The credit union also saw Facebook "likes" increase by 42% throughout the promotion.
 
Shellye Carpenter, a Dallas FCU marketing officer, said that members responded positively to the informative aspects of the contest. "We've had several members tell us they didn't know about products like GAP and Extended Warranty coverage," she said, "but learned about them through the scavenger hunt."

Winners Of CUNA's 2013 Desjardins Fin. Ed Awards Announced

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WASHINGTON and MADISON, Wisc. (11/15/13)--The Credit Union National Association announced Thursday the winners of awards to credit unions with outstanding financial education programs in 2013.

Recipients of the Desjardins Financial Education Awards included nine first-place winners in youth and adult education categories, and several second-place winners and honorable mentions.
 
"Nine first-place winners are a testament to the commitment of credit unions in providing their members, and their prospective members, a solid understanding of the challenges and rewards of fully understanding their financial positions," said Bill Cheney, CUNA president /CEO.
 
First-place honorees in the youth education category were:
  • Community CU, in Lewiston, Maine;
  • CORE FCU, in East Syracuse, N.Y.;
  • Silver State Schools CU, in Las Vegas, Nev.; and
  • Topline FCU, in Maple Grove, Minn.
Second-place honorees in the youth category were:
  • Clarence Community & Schools FCU, in Clarence, N.Y.;
  • CommunityAmerica CU, in Kansas City, Mo.;
  • Education CU, in Amarillo, Texas; and
  • Public Service CU, in Romulus, Mich.
Honorable mentions for the youth category were:
  • Altra FCU, in Onalaska, Wis.;
  • Central City CU, in Marshfield, Wis.; and
  • HealthCare First CU, in Johnstown, Pa.
First-place honorees in the adult education category were:
  • Bayport CU, in Newport News, Va.;
  • Community CU, in Lewiston, Me;
  • Electro Savings CU, in St. Louis, Mo.; and
  • St. Louis Community CU, in St. Louis, Mo.
Second-place winners in the adult category were:
  • CommunityAmerica CU, in Kansas City, Mo.;
  • Greater Minnesota CU, in Mora, Minn.; and
  • Topline FCU, in Maple Grove, Minn.
Honorable-mention winners for the adult category were:
  • University of Michigan CU, in Ann Arbor, Mich.; and
  • US FCU, in Burnsville, Minn.
CUNA also honored The Maine Credit Union League with a Desjardins Financial Education Award for its efforts to improve financial literacy among children and adults.

The awards are named after Alphonse Desjardins, who founded the first credit unions in the U.S. and Canada. Desjardins also founded youth savings clubs, in-school banks, "caisses populaires," and cooperative savings and loan companies tailored to the needs of the working class.

Winners will be honored at a Feb. 26 award ceremony that will be held amid CUNA's 2014 Governmental Affairs Conference--scheduled to take place between Feb. 23 and Feb. 27 in Washington, D.C.

CUNA Announces Dora Maxwell, Louise Herring Award Winners

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WASHINGTON and MADISON, Wis. (11/15/13)--The Credit Union National Association announced Thursday the winners of this year's national Dora Maxwell Social Responsibility Community Service and Louise Herring Philosophy-in-Action Member Service Awards.
 
"Early this year, we unveiled our 'Unite for Good' initiative, which urges credit unions to come together toward the establishment of a shared strategic vision: 'Americans choose credit unions as their best financial partner,'" said Bill Cheney, CUNA president/CEO.
 
"To achieve this vision, we have identified a 'shared agenda' for the credit union movement: To remove barriers, create awareness and foster service excellence. In fact, the winners of this year's awards are among the vanguard of credit unions that are already pursuing this shared agenda--by employing the credit union philosophy, and by taking on social responsibility projects," Cheney said.
 
The first-place Dora Maxwell Award honorees this year are:
  • Keystone United Methodist FCU, for credit unions with between $5 million and $20 million in assets, in Cranberry Township, Pa.;
  • Communicating Arts CU, $20 million-$50 million, in Detroit, Mich.;
  • North Central Area CU,  $50 million-$100 million, in Houghton Lake, Mich.;
  • SPC CU, $100 million-$200 million in Hartsville, S.C.;
  • Merck Sharp & Dohme FCU, $200 million-$500 million, in Chalfont, Pa.;
  • Alabama CU, $500 million-$1 billion, in Tuscaloosa, Ala.;
  • Indiana Members CU, over $1 billion in assets, in Indianapolis, Ind., and
  • Northwest Chapter of Credit Unions, for the credit union association award, in Greensboro, N.C.
The first-place Louise Herring Award honorees this year are:
  • Bridge CU Inc., for credit unions with less than $50 million in assets, in Columbus, Ohio;
  • Five County CU, $50 million-$250 million, in Bath, Maine;
  • Michigan First CU, $250 million-$1 billion, in Lathrup Village, Mich.;
  • Tinker FCU, over $1 billion in assets, in Oklahoma City, Okla., and
  • Michigan Credit Union League & Affiliates, for the credit union association award, in Lansing, Mich.
Maxwell was an original signer of CUNA's constitution, and an organizer of hundreds of credit unions and volunteer clubs in the U.S. Herring was also an original signatory to CUNA's constitution as an Ohio delegate to the 1934 national credit union conference.

The winners, who were selected by a national committee, will be honored during a Feb. 26 reception--part of CUNA's 2014 Governmental Affairs Conference, which takes place between Feb. 23 and Feb. 27 in Washington, D.C.

Auto Loan Balances At Record High $782.9B

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SCHAUMBURG, Ill. (11/15/13)--Third quarter outstanding auto loan balances are at a record high, according the Experian Automotive, which began recording the data seven years ago.
 
Outstanding balances on automotive loans reached $782.9 billion, up from $103 billion in the third quarter of 2012.
 
Thirty-day loan delinquencies were down 3.4% from 2012 to 2.58% 2013 from 2.67% the same time last year. Sixty-day delinquencies remained flat.
 
Credit unions also showed auto loan growth, according to Credit Union National Association research and statistics. New-auto loans increased to 10.8% of total loans for the third quarter of 2013, compared with 10.4% in the third quarter of 2012. Used-auto loans rose to 19.8% of total loans, compared with 19.1% for the same period in 2012.
 
Auto loan balances are growing nationwide, according to the Experian report. States with the fastest percentage growth year over year included California (29.3%), Texas (26.3%) and Nevada (26.%). The states with the slowest growth rates year over year were Hawaii (12.4%), Wyoming (12.3%) and Michigan (6.8%).
 
States with the steepest decline in the loan balances currently 30 days delinquent year over year are Hawaii (12.75%), Vermont (11.69%) and Oregon (11.64%). States with the biggest jump in 30-day automotive loan balance delinquencies year over year included Rhode Island (18.53%), Wyoming (11.98%) and Alaska (10.24%).
 
Other findings:
  • Outstanding loans in the nonprime, subprime and deep-subprime segments were up slightly (36% from 35.9% in the third quarter of 2012);
  • The percentage of loan dollars 30 days delinquent rose slightly (2.17% from 2.16%);
  • The percentage of loan dollars that are 60 days delinquent rose slightly (0.52% from 0.5%); and
  • The average charge-off amount for bad loans increased to $7,770 from $7,026.

CU Members Mortgage Names Mortgage Elite Program CU Winners

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DALLAS (11/14/13)--Credit union mortgage services provider CU Members Mortgage has named the winners of its annual Credit Union Elite Partners Club program for its 2012-2013 fiscal year.
 
The winning organizations' achievements were based on CU Members Mortgage's scorecard process, which evaluates its partners' mortgage department annual performances.  The credit union organizations that met their goals include:
 
  • Mortgage Ease 1--Credit Union of Texas, Dallas;
  • Mortgage Ease 2--Riverland CU, New Orleans;
  • Mortgage Ease 3--Eli Lilly FCU, Indianapolis;
  • Mortgage Ease 4--Security Service FCU, San Antonio;
  • Top Credit Union League--Cornerstone Credit Union League;
  • Marketing Achievement--Louisiana Credit Union League; and
  • Marketing Achievement--League of Southeastern Credit Unions.
 
The scorecard process was developed to emphasize how credit unions evaluate the progress, effectiveness, and quality of their mortgage programs.
 
The scorecard takes into account factors such as the ratio of home loans that are purchased compared to home loans being refinanced, average borrower FICO scores, a low percentage of early payoffs and a miniscule default ratio. Additionally, credit unions score points for innovative marketing initiatives and attending educational training sessions.

Illinois League Honors State Winners

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NAPERVILLE, Ill. (11/15/13)--The Illinois Credit Union League has named its state-level winners of the Dora Maxwell Social Responsibility, Louise Herring Philosophy in Action and Alphonse Desjardins Financial Education awards.
 
"The Illinois awards continue to serve as great examples of excellence in service to their members and their communities," said Dan Plauda, ICUL president/chief executive officer.  "We are very pleased to have one of our credit unions once again place in the national competition this year and our congratulations go to all that participated."
 
The state Alphonse Desjardins Youth Financial Award winners by asset size include:
  • $150 million to $500 million, Financial Plus CU, Ottawa; and
  • $500 million plus, Great Lakes CU, North Chicago.
 The Dora Maxwell Social Responsibility Community Service award winners include:
  • $50 million to $100 million, Rock Valley FCU, Loves Park; 
  • $100 million to  $200 million, Streator (Ill.) Onized CU;
  • $200 million to $500 million, GCS CU, Granite City; and
  • $500 million to $1 billion, Great Lakes CU.
Streator Onizied CU also placed in second in the national competition.
 
Louise Herring Award for Philosophy in Action Award winners included:
  • $50 million to $250 million, Gateway Metro FCU, Swansea; and
  • $250 million to $1 billion, Scott CU, Edwardsville.
Recognized for community service, service to members and non-members, and financial education, the award recipients competed for the same awards on the national level. For the Credit Union National Association's national award winners see "CUNA Announces Dora Maxwell, Louise Herring Award Winners" and "Winners Of CUNA's 2013 Desjardins Fin. Ed Awards Announced" in today's issue of News Now. Winners will be invited to attend the 2014 CUNA Governmental Affairs Conference in Washington, D.C.

CU Blog Focuses On Corporate Social Responsibility

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KANSAS CITY, Mo. (11/15/13)--Kansas City, Mo.-based Mazuma CU's monthly blog is tackling a five-part series on "Community Collaboration," with the first article discussing corporate social responsibility.
 
The series, written by Mazuma President/CEO Brandon Michaels, focuses on the critical role corporate social responsibility (CSR) plays in the future growth of financial institutions and notes that today's marketplace demands that businesses reflect principles of CSR in their strategies for growth. Credit unions in particular offer an inspirational model for the role of CSR in a growing enterprise, said the $487 million asset credit union.
 
"Credit unions have emerged as a bright spot within the [financial services] industry, enjoying higher levels of customer loyalty from members who actually own a part of their institutions," said the first article, "Community-Based Corporate Social Responsibility Platforms: The Next Key Building Block for Credit Unions?" "Member loyalty, in turn, is fueled by community engagement and a proactive CSR platform. Indeed, credit unions are a model for how a financial institution can drive growth through community connections based on CSR."
 
"The marketplace expects financial institutions to respect the communities in which they operate. Doing good and giving back is no longer a luxury. A well-developed CSR program addresses those issues, and functions as a valuable corporate asset. To that end, a proactive CSR platform will support an overall business model," Michaels wrote.
 
Six elements drive an effective CSR program: Mission, alignment, engagement structure, communication and sales, and evaluation. "To lead the marketplace and rise above competition from other financial institutions, a credit union CSR and community investment platform should embrace all six key elements," Michaels said.
 
Credit unions "have a unique opportunity to deliver value to consumers that elevates the credit union brand through integrating CSR into business strategy," he concluded.

Future articles will address:
  • "Financial Education for Young Adults: A Community Imperative";
  • "Why Giving Your Employees Financial Education Makes Smart Business Sense";
  • "Small Business Growth Strategies: The Unique Advantages of a Credit Union"; and
  • "Creativity and the Growth of Business: Why a Credit Union Should Care About the Arts."
To read the article, use the link.

MyCUmortgage Announces Mortgage Lending Awards

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FAIRBORN, Ohio (11/13/13)--myCUmortgage announced the recipients of its Awards for Excellence in Mortgage Lending. The winning partner credit unions were recognized for outstanding results in helping members with home ownership at the credit union service organization's Annual Partner Conference in Fairborn, Ohio, Oct. 1-3.
 
Credit unions were recognized for their outstanding achievements. Awards were based on mortgage activity from July 1, 2012 to June 30, 2013.
 
Award winners included:
 
Originator of the Year
  • Small credit union--Dynamic FCU, Celina, Ohio;
  • Mid-size credit union--Midwest Community CU, Defiance, Ohio; and
  • Large credit union--Workers' CU, Fitchburg, Mass.
New Producer Awards
  • Small asset--Perfect Circle CU, Hagerstown, Ind.;
  • Mid-Size asset--Ashland CU, Ashland, Ky.; and
  • Large asset--Dominion CU, Richmond, Va.
Purchase Lender Awards
  • Small asset--Dayton Firefighters FCU, Dayton, Ohio;
  • Mid-Size asset--Indiana State University FCU, Terre Haute, Ind.; and
  • Large asset--Canton Schools Employees FCU, Canton, Ohio.
Individual Originator of the Year Awards                                                                     
  • Tim Muffley, mortgage loan manager, DESCO FCU, Portsmouth, Ohio;
  • Wendy Bussa, mortgage loan officer, Hopewell FCU, Heath, Ohio; and
  • Michelle Boughan, vice president of mortgage lending, TopMark FCU, Lima, Ohio.
Peoples FCU, Nitro, W. Va., and Finance Center FCU, Indianapolis, received CU Select awards, based on mortgage loan volume.

The 2013 Susan Edwards Scholarship Award recipient was Rob Whitley of Metro Community FCU, Huntington, W. Va. The scholarship to attend the conference was created in memory of Susan Edwards, myCUmortgage's first loan coordinator, who worked her way up to become the operations manager for the company. She died of cancer in 2009.

CU System Briefs

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  • FOXBOROUGH, Mass. (11/14/13)--A prominent figure in the New England credit union scene was honored at a party celebrating his retirement at Gillette Stadium. Dan Egan--president/CEO of the Massachusetts Credit Union League, the New Hampshire Credit Union League, and the Credit Union Association of Rhode Island--was joined by 250 friends, colleagues and family members at the New England Patriots' home on Nov. 7. The party, which took place in a suite overlooking the field and was emceed by Mark Sievewright, Credit Union Solutions at Fiserv president, featured industry figures from around the country, including: David Surface, CEO of St. Jean's CU and chairman of the Massachusetts league; David Suvall, president of the Rhode Island CU; Gerry Dumoulin, president of Guardian Angel CU; Bill Sinibaldi, president of Metro CU; Bob Delaney, chief operating officer of Members Insurance; Credit Union National Association President/CEO Bill Cheney; CUNA Senior Vice President and Executive Director of the American Association of Credit Union Leagues Susan Newton; Cornerstone Credit Union League President Dick Ensweiler; and former Senior Vice President of CUNA Mutual David Cry. Egan (pictured posing in front of the ballfield's Jumbotron with his family) spoke at the end of the program, praising the cooperative nature of credit unions. He worked in the industry for 32-years (e-Weekly Nov. 13) (Photo provided by the Massachusetts and New Hampshire Credit Union Leagues and the Credit Union Association of Rhode Island) ...
  • CHESTERFIELD, Va. (11/14/13)--A 21-year-old man pleaded guilty to crimes related to an April 2012 fatal shooting that took place in a Virginia State University FCU parking lot (Richmond Times-Dispatch Nov. 12). Khaliq H. Oliver pleaded guilty to attempted robbery, conspiracy to commit robbery, using a firearm in the commission of attempted robbery, and being an accessory after the fact to second-degree murder. Oliver was sentenced to 24 years with 19 years suspended by Chesterfield Circuit Judge Steven McCallum. Co-defendent Ryan Christopher Simms was convicted of the second degree murder of Tyrail Hughes, 20. A jury agreed with prosecutors that he shot Hughes after a drug deal in which Oliver stole an ounce of cannabis. Simms allegedly plotted with Oliver to arrange the deal, and Oliver, armed with a BB gun, was accused of taking the drugs without paying before fleeing. Simms, who was armed with a .380-caliber semi-automatic pistol, opened fire on Hughes, who was discussing the occurrence with three others in the parking lot. Simms also accidentally shot then-VSU freshman William Penn in the foot, and was found guilty of malicious wounding for the act. VSU FCU surveillance cameras captured the entire incident (News Now April 20, 2012) ...
  • TAMPA, Fla. (11/14/13)--A couple was arrested by federal agents in Tampa, Fla., in relation to a string of 15 robberies that ended with the holdup of  Alabama CU in Gulf Shores, Ala. last week (Mobile Press-Register Nov. 13). Immanuel Lee Williams and Cara Lee Williams, both 28, were arrested after a 10-month investigation. A federal criminal complaint filed at a U.S. District Court in Florida accuses the couple of 13 robberies netting $54,740 in Alabama and Florida between December 2012 and October 2013. Federal investigators got a major lead in the case after an Aug. 28 robbery at MidFlorida CU in Davenport, Fla. A surveillance camera near the credit union captured the license of a getaway car registered to Cara Williams. Prosecutors believe that in all cases except one, the robber was Immanuel Williams, consistently described by witnesses as a black male, about 6 feet tall and wearing an afro wig. According to the complaint, Williams passed threatening notes to tellers demanding money in block lettering. The complaint also details agents tracking his movements through his cell phone and through photos he posted on Facebook. It also alleges that Cara Williams was responsible for a robbery on Nov. 4. Witnesses reported a white woman wearing a disguise who passed the teller a threatening note similar to the ones Immanuel Williams is accused of using ...
  • SIOUX FALLS, S.D. (11/14/13)--Sioux Falls (S.D) FCU was recently presented with counterfeit checks, the Credit Union Association of the Dakotas reported (Memo Nov. 13). When verifying information on the checks, the credit union learned the checks were counterfeit. The checks are issued from a company called Asset Nation Inc. and are drawn on Bank of America, with the routing number 026009593 and account number of 488029549928. The company and the account number are legitimate, but the checks are counterfeit. The routing number is not used by BofA for check clearing ...
  • LANSING, Mich. (11/14/13)--Fred Schuster will retire as president/CEO of Wexford Community CU, Cadillac, Mich. effective in December. Julie Rushing, current chief operating officer, has been named to succeed him as president/CEO. Schuster served in that position for 12 years since 2001, said the Michigan Credit Union League (Michigan Monitor Nov. 11). Schuster started working in the credit union movement in 1980, when he took over as manager/treasurer of Livonia Parishes FCU, which is now Catholic Vantage Financial FCU, Livonia. He became president/CEO of Isabella Community CU, Mt. Pleasant, in 1999. At Wexford Community CU, Schuster has helped the credit union more than double its asset size to $46 million from $19 million and expand its field of membership to three counties from one. Rushing has been with WCCU for seven years and is a recent graduate of CUNA Management School ...
  • WASHINGTON (11/14/13)--The U.S. Department of Agriculture Wednesday bestowed the "Fired Up" Award to the National Credit Union Administration in recognition of its "incredibly successful" food drive effort, which brought in over 22,000 pounds of food to the Capital Area Food Bank. This award, which is a part of the annual Feds Feed Families food drive, honored the agency with the largest increase in donations from 2012 (News Now Oct. 17). NCUA's 2013 donation was nearly 1,000% larger than its contribution in 2012 and was enough to provide more than 18,000 meals to Washington, D.C., area residents. Since the Feds Feed Families annual food drive began in 2009, the government-wide effort led by the USDA has collected nearly 25 million pounds of food and non-perishable items to support families across the U.S. Shown here: Krysta Harden (left), deputy secretary, USDA, poses with Todd Harper, director of the NCUA's Office of Public and Congressional Affairs and the plaque awarded to NCUA and its employees (Photo provided by NCUA) ...

CU House Report: Contributors Up From 2012

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WASHINGTON (11/14/13)--The nation's Credit Union House continues to play a key role in credit union advocacy efforts, with more credit unions using it as a base for their Hill activities in Washington, D.C.
 
Click to view larger image This group from Montana get the "Don't Tax My Credit Union" message across during a visit to Credit Union House in Washington, D.C. From left are: Al Vukasin, president/CEO of Bear Paw CU, Havre; April Baimonte; Tristan Vukasin; Eddie Black, president/CEO of Trico Community FCU, Helena; and Tracie Kenyon, president/CEO of the Montana Credit Union Network. (Photo provided by Credit Union House)
"Credit Union House maintains a highly valuable and unique presence for credit unions on Capitol Hill," said Sue McCue, Credit Union House director. "It is sought out by top-tier lawmakers for a wide variety of events and remains a strategic place for CUNA and league representatives to coordinate advocacy efforts," she added.
 
During third quarter, Credit Union House contributor numbers increased to 387--up from 310 in July and an overall 5% increase from the same period in 2012, according to its quarterly newsletter, Highlights from the Hill.
 
Twelve leagues representing 17 states already have reached their annual contribution goals. They include:
  • Alaska Credit Union League;
  • Cornerstone Credit Union League;
  • Georgia Credit Union Affiliates;
  • Hawaii Credit Union League;
  • Idaho Credit Union League;
  • Iowa Credit Union League;
  • Maine Credit Union League;
  • Mississippi Credit Union Association;
  • Montana Credit Union Network;
  • Mountain West Credit Union Association;
  • Northwest Credit Union Association; and
  • Ohio Credit Union League.
Fifteen other states have reached half or more of their goals.
 
During third quarter, Credit Union House hosted league Hike the Hill programs and credit union planning sessions as well as political fundraisers and functions. Leagues and their member credit unions welcomed in recent months have represented California and Nevada, Illinois, Iowa, Kansas, Florida and Alabama, Maine, Maryland and District of Columbia, Minnesota, Montana, Oregon and Washington, and Ohio.
 
This year, Credit Union House hosted nearly 3,000 guests. Among them were 75 members of Congress from 22 states. It hosted 20 political fundraisers, split evenly between parties and attended by credit union-friendly officials.
 
The Credit Union House Hall of Leaders, which provides lasting recognition for credit union leaders whose commitment has significantly impacted the credit union movement at the local, state or national level, accepts nominations year-round. However, Jan. 17 is the deadline for nominations to be recognized during the Credit Union National Association's Governmental Affairs Conference in Washington in February.
 
For more information, use the link or contact McCue at 202-548-3130.

Dancing MCUA Flash Mobs Give 'CU Movement' New Meaning

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ST. LOUIS, Mo. (11/14/13)--The Missouri Credit Union Association gave a whole new meaning to the term "credit union movement" last month.

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MCUA organizers put on flash mobs on the campuses of the University of Missouri and Stephens College, in which credit union volunteers shook their money-makers in a bid to convince students to re-think which financial institutions make money for them (Missouri Difference Nov. 13).
 
Jesse Wolken, a flash mob participant and Jefferson City-based Conservation Employees CU staffer, described it as "a lot of fun," and said she was shocked at the number of students who stopped to watch.

Following the flash mobs--held on Oct. 16 at the University of Missouri and Oct. 21 at Stephens College--MCUA employees and credit union volunteers distributed candy and brochures about the "Bank on MOre" campaign, an effort to educate Missourians about credit unions.
 
The MCUA guerrilla marketing effort was part of a statewide consumer awareness campaign called "Make the Switch Week." A five-day push that started on Oct. 14, it was a statewide effort that encouraged Missouri credit union members to discuss the benefits of credit union membership with acquaintances and friends. 
 
In addition to the flash mob, participating credit unions received T-Shirts, trick-or-treat bags, and cutout piggy banks from the MCUA. In a webinar hosted the week before, the association encouraged credit unions to use the trinkets in various "Make the Switch Week" social media contests.
 
"Make the Switch Week offered an exciting opportunity for credit unions to really ramp up their messages on social media," Nora Holloway, MCUA director of public relations and online community, said. "There was a great showing of participation from credit unions, and it made a great impact on their community.
 
According to Federal Reserve data, young adults can expect to accrue over $100,000 in money saved by choosing credit union membership over accounts at traditional banks (News Now Oct. 18).

To watch Missouri credit union volunteers perform their dance routine at the University of Missouri, use the link.

Pa., N.Y. CU Marketers Meet To Tackle Trends, Compliance

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ALBANY, N.Y. (11/14/13)--Credit union marketers explored topics such as cross-selling, compliance and social media at the Credit Union Association of New York's Marketing Conference last week.
 
Click to view larger image Credit union marketers from New York and Pennsylvania gathered at the Credit Union Association of New York's Marketing Conference last week. (Photo provided by the Credit Union Association of New York)
The conference, held Nov. 7-8, attracted attendees from across New York and Pennsylvania.
 
The conference kicked off with a presentation from featured speaker Sean McDonald, president of Your Full Potential LLC and founder of Credit Union Business Development Academy. McDonald described how to build an effective cross-selling culture and overcome challenges associated with cross-selling. Attendees then broke into groups to develop cross-selling ideas for hypothetical situations.
 
CUANY Compliance Director Mike Carter then explained how and why compliance applies to marketing and communications professionals and cited specific examples of potential compliance pitfalls.
 
On Nov. 8 Tansley Stearns, impact director at Filene Research Institute, explained findings from Filene's social media research and shared ideas on building effective social media strategies. She also previewed the QUEsocial Social Media Solution, which is designed to help credit unions expand their social media presence.
 
The conference concluded with presentations from Covera Fraud Analyst Christina Duncan and Portfolio Consultants' Carol Ann Pacco-Long and Walter Wittemann. They focused on EMV technology and debit/credit card marketing strategies.
 
Additional speakers included: Allison Barna, CUANY vice president; Chris Pajak, CUANY human resource management consultant; and Elise Glassett, marketing specialist at Sidney (N.Y.) FCU.

Biz2Credit: Shutdown Nicked CUs' MBLs

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NEW YORK (11/14/13)--The federal government's partial shutdown in October took a toll on small business lending at financial institutions, including credit unions, according to Biz2Credit Small Business Lending Index.
 
The index provides a monthly look at loan applications on Biz2Credit.com, which arranges small business loans throughout the U.S. by matching borrowers to financial institutions.
 
Biz2Credit noted that during October, the Small Business Administration was closed for three weeks.
 
"SBA loan approvals stalled because the agency was not working for three weeks," said Biz2Credit CEO Rohit Arora. "Similarly, non-SBA [loans] could not be processed during the government shutdown because the Internal Revenue Service was shut down.
 
"Banks could not acquire income verification from the IRS during the shutdown, which is needed to approve many loan requests," Arora said, adding, "A major backlog of SBA loans from the shutdown will take months to process, and the debt ceiling debate could negatively impact small business lending even further in the coming months."
 
Credit unions in the survey experienced a 4% decrease in approval rates during October. Their lending approval rates dropped to an all-time index low of 43.4%, down from 45.50% in September.  That compares with 49.2% approval in October 2012.
 
During October, big banks approved 14.3% of business loan applications, down from 17.50% in September and 14.8% in October 2012. Small banks' approval rate also dropped to the lowest approval rate since August 2011.
 
The study indicated that small business owners desperate for capital at a time when small businesses typically search for funding turned to alternative lenders who charged higher interest rates than a credit union or bank would charge.
 
Arora said loan approval rates for small businesses likely would grow in November while the banking industry recovers from the shutdown's repercussions.

Leadership Development Wraps Up LSCU's 2013 Conferences

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TALLAHASSEE, Fla. (11/14/13)--A Leadership Development Conference presented by the League of Southeastern Credit Unions and its affiliates last week in Point Clear, Ala., wrapped up the league's major conferences for 2013.
 
Click to view larger image Alabama Lt. Gov. Kay Ivey, keynote speaker at the League of Southeastern Credit Unions' governmental affairs luncheon, speaks with Kenneth Livingston, Supervisory Committee chairman at Family Security CU, Decatur, Ala. (Photo provided by the League of Southeastern Credit Unions)
LSCU & Affiliates President/CEO Patrick La Pine welcomed 400 attendees and provided updates on comprehensive tax reform as well as talked about the primary results from the Congressional District One race. Republican Bradley Byrne won the primary and will face Democrat Burton LeFlore on Dec. 17, with the winner assuming U.S. Rep. Jo Bonner's seat. Building a relationship with Byrne is key in a district that has been credit union friendly in the past, La Pine told the group.
 
CO-OP Financial Services CEO Stan Hollen spoke about the future of card services and the next generation ATMs that include shared branching. The CO-Op credit union ATM network is the largest in the country and includes all financial institutions, Hollen said, noting this is a unique selling point for credit unions. The shared branching network is the fourth largest branch network among financial institutions, with only three large banks having bigger networks, he said.
 
NCUA Region III Director Herb Yolles presented an overview of the credit union industry. The first look at third-quarter data shows that Alabama credit unions have $18 billion in assets, while Florida credit unions have $47.1 billion, Yolles said. Loans were up nationally, as well as in the two states.  Auto loans were showing major signs of improving, he added. Yolles provided a look at the agency's top regulatory concerns, which included Prompt Corrective Action risk on net worth and stress testing.
 
Alabama Lt. Gov. Kay Ivey, speaking at the league's governmental affairs luncheon, said the current state administration stressed three keys: streamline government without raising taxes, create jobs, and maintain essential services. The state has done all three, and Alabama is in a much better state today than four years ago and on greater financial footing, she said.
 
Body language expert Jan Hargrave provided the keynote address. She invited Corporate One FCU CEO Lee Butke on stage to demonstrate body language in handshakes. Palms up is a sign of respect, while a finger pointing means the person is looking for control, she said. Hargrave also told how to spot a liar: the person wipes his face or ears with the left hand. A right hand on the heart is a sign of respect. Hargrave left attendees with tangible ways to look at their staff, members, and friends.

For photos from the LDC, check out the LSCU Facebook page by using the link.

Illinois League Hosts Expanded Workshops For Small CUs

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NAPERVILLE, Ill. (11/14/13)--The Illinois Credit Union League this week held expanded state-wide workshops for credit unions with less than $50 million in assets.
 
The symposia were held in Dekalb, Springfield and Edwardsville. They featured discussions about cooperation between credit unions, human resources, internal controls, strategic planning, political action, public relations and member disclosures.
 
"In our on-going, critical dialogue with small credit unions, we wanted to keep offering opportunities for them to gain industry knowledge and put it to work right away in their shops," said Joni Senkpeil, league director of small credit union development. "If there's one thing that stands out in our industry, it's the ease in which small credit unions share and learn from each other and the willingness of larger credit unions to dialogue with them by sharing information and best practices."
 
Presentations were given by league staffers, credit union employees and others.
 
The league's website also features resources for small credit unions which include documents, templates, and other information, and the league hosts an annual SAS (small asset size) Credit Union Conference. The league's SAS Advisory Group is charged with four priorities on behalf of SAS credit unions:  reducing regulatory and compliance burden, promoting collaboration, enhancing communication, and increasing competitiveness.

Illinois has 276 credit unions with less than $50 million in assets. They make up 80% of the league's member credit unions.

CUAD Rallies To Head Off County Commission Vote On Tax Status

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BISMARCK, N.D. (11/14/13)--South Dakota credit unions are rallying to turn back an attempt by state banks to change the credit union tax status.
 
On Tuesday, South Dakota's Brookings County Commission will vote on a resolution that supports taking the tax-exempt status away from credit unions and farm credit services.
 
South Dakota banks claim that they have met with U.S. Sen. John Thune (R) and that Thune supports the measure, said the Credit Union Association of the Dakotas (Memo Nov. 13). Thune is a member of a Senate Tax and Finance sub-committee that will help draft tax reform.
 
"Unfortunately we continue to see banker attacks on our tax status at the state level just as in Washington," said Trey Hawkins, Credit Union National Association vice president of political affairs. "CUNA is committed to working with CUAD and South Dakota in any way we can to help beat this latest tax threat back."
 
CUAD is committed to rallying the troops and telling the credit union story, Jeff Olson, CUAD vice president of advocacy and awareness, wrote in the association's newsletter.
 
"All of the banks' rallying points are based on the typical hollow arguments," Olson told News Now Wednesday. "For every argument they make we have a rebuttal. We just want a chance to tell our side of the story. We think our arguments will prevail."
 
CUAD coordinated a state-wide conference call Monday to roll out a response strategy.
 
Dakotaland FCU, Huron, has requested rebuttal time on the commission's agenda Tuesday. Members of the CUAD advocacy department also will be prepared to respond.
 
The league has contacted a reporter who wrote an article about the hearing. CUAD secured a rebuttal article near the date of the commission meeting, regardless outcome of the vote.
 
CUAD also is preparing collateral materials to be sent to each commissioner this week.
 
The league also asked the state's credit unions to fill the commission hearing room with supporters as well as credit union staff and members in the Brookings County area to contact commissioners.  A postcard drop will be delivered on Monday.
 
CUAD also asked credit unions across the state to be on the lookout for similar resolutions on their local city and county commission agendas. 
 
CUAD has placed a radio media buy in the Brookings market to counter bank radio ads.

CU System Briefs (11/13/2013)

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  • HERSHEY, Pa. (11/13/13)--Pennsylvania Credit Union Association's retiring President/CEO Jim McCormack was honored by 200 state credit union leaders, friends and family members on Friday night in Hershey, Pa. (Life is a Highway Nov. 12). PCUA Board Chair Maria LaVelle emceed the event, which featured remarks from: Credit Union National Association President/CEO Bill Cheney; CO-OP Financial Services Chairman Bill Raker; CO-OP Financial Services CEO Stan Hollen; CUNA Mutual Group Sales Manager Paul Butler; Pennsylvania Credit Union Service Centers Chairman Ralph Canterbury; PCUA Director Cookie Yoder; PCUA Executive Vice President and General Counsel Rick Wargo; and, from the McCormack family, Ed Coleman. Cornerstone Credit Union League CEO and Credit Union House Chairman Dick Ensweiler also announced McCormack's induction into the Credit Union House Wall of Leaders. CO-OP Financial Services also announced a $10,000 Judge/Bradley Leadership School scholarship in McCormack's name. Throughout the event, McCormack was honored for his contributions to the credit union movement at both the state and national level ...
  • HICKORY, N.C. (11/13/13)--U.S. Rep. Patrick McHenry (R-N.C.) learned on Tuesday about a Local Government FCU loan that helped a volunteer fire department in his constituency. During a visit to Mountain View Volunteer Fire Department in Hickory, N.C., McHenry (at right) was told that LGFCU Commercial Lending's division provided the department the financing to buy and repurpose property that became its headquarters. The move saved taxpayers about $1 million, said the credit union. McHenry was also told about Mountain View VFD's work.  Shown with McHenry are, from left:  LGFCU Commercial Lending executives Sherrod Warwick and Bill Carter; Lt. Paul Exon; Chief Tony Holsclaw; Firefighters Sarah Loria and Mickey Lasone, and Lt. Bryan Lynch. LGFCU has a loan program that caters to non-profit emergency responders in North Carolina. It has given 35 lines of credit worth $6.5 million to 21 non-profit first responders in McHenry's district. "These are the people who put their lives on the line each day to protect lives and property in their communities, and they deserve the benefit of the equipment they need to perform their duties safely and efficiently," said Carter, LGFCU vice president of commercial lending. "Beyond being the right thing to do, these men and women who serve our communities are in our credit union's field of membership, so it makes sense for us to make these loans." LGFCU has $1.2 billion in assets and is based in Raleigh, N.C. ...
  • FARMERS BRANCH, Tex. (11/13/13)--CU Members Mortgage President Dave Motley was honored with the Mortgage Bankers Association's Andrew D. Woodward Distinguished Service Award--for his contributions on regulatory and legislative issues--during MBA's 100th Annual Convention & Expo, Oct. 27-30 in Washington, D.C., said the Cornerstone Credit Union League (Leaguer Nov. 12). Nominees for the annual award must be associated with an MBA member firm, and have a record of sustained service to the MBA and the mortgage industry. CU Members Mortgage, a business partner of Credit Union Resources headquartered in Addison, Texas, originates more than $3 billion in mortgage loans annually, services a portfolio greater than $14 bullion, and owns more than $1 billion in assets. It serves credit unions, credit union service organizations and league partners ...  

Montana FCU's Pay It Forward: Doing Good On the Fly

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GREAT FALLS, Mont. (11/13/13)--With Veterans Day observed by the federal government, most financial institutions were closed on Monday. But one credit union based in Great Falls, Mont., gathered Monday for a community service seminar that resulted in a whimsical effort to improve peoples' lives with scant planning and a pocketful of cash.
 
Click to view larger image Kevin Hollingworth, left, and Martha Kennedy of Great Falls-based Montana FCU examine a child's coat with Western Ranch Supply manager Larry Kelly.  They were part of nine groups of credit union employees who were given $73 each to do some good on the fly. (Photo by Larry Beckner provided by the Great Falls Tribune)
Employees at Montana FCU, encouraged by seminar organizers to act on good intentions, were split into nine groups of six-to-eight people, and given $73 and two hours to make a positive impact on the town's residents (Great Falls Tribune Nov. 11).
 
 The two-hour time constraint and a $73 budget "is kind of a stickler," so the project needed to be along the lines of a pay-it-forward concept, said Becky Timmons, seminar organizer and Montana FCU vice president of marketing. She told the Tribune the groups had to use the money to make somebody's day "a little bit brighter."
 
Inspired by a Great Falls Chamber of Commerce project that encouraged community participation, the groups were dispatched to different parts of Great Falls and told to spend the money at neighborhood businesses.
 
One group picked up the tab for customers at a drive-through coffee house and convinced a store to donate a child's winter coat--while making purchases for an elementary school's charity winter clothing drive--before rounding out its impromptu cash mob buying sodas and coffees for people at the Veteran of Foreign Wars post.
 
Although she is not one to drop everything and do this type of thin, "this is really fun," remarked Montana FCU employee Amy Hodges remarked during the micro-spree.

Organizers decided to give each group $73 in honor of the 73rd anniversary, commemorated this year, of Montana FCU's founding. That added up to $657 in random disbursements on Monday.
 
Montana FCU, which has $196 million in assets, has given $115,000 to community organizations over the past two years.
 
The Credit Union National Association encourages credit unions to participate in such events as part of the leagues' and CUNA's Unite For Good campaign, which spreads awareness about the community-oriented focus of credit unions and their value.  For more information, use the links.

'Catch the $ave Wave' Announced As 2014 Theme For Youth Week

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MADISON, Wis. (11/13/13)--Credit unions nationwide selected "Catch the $ave Wave" to be the theme for the 2014 National Credit Union Youth Week, which will take place April 20-26, 2014.

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The concept was chosen from ideas submitted to the Credit Union National Association by credit union staff this fall.
 
"Catch the $ave Wave" harnesses kids' love of the beach, sand and surfing and shows younger members they can benefit from visiting--and saving at--their credit union. The goal of Youth Week is to pave the path to life-long credit union membership by encouraging kids to set up savings accounts, learn how to manage money, and be more financially literate.
 
This year's theme has connected with credit union professionals: "An effective campaign held at our credit union used beach balls throughout the lobby. The kids loved this," said Meredith Mosely, marketing director at Tomah (Wis.) Area CU. "Youth Week is a great time for kids to learn how to save at their credit union and enjoy the season with surf-themed activities."
 
Credit unions nationwide may join in the celebration throughout April, or limit it to only National Credit Union Youth Week, by encouraging youth to set up savings accounts and learn how to manage money. By focusing on potential younger members, participating credit unions can lower their age demographics, while increasing the loyalty of parents.
 
"National Credit Union Youth Week fits perfectly with the credit union cooperative principle of member education," said Jan Garkey, CUNA's Youth Week coordinator. "Expose young children to the credit union through regular deposits of their quarters, hold a Mad City Money simulation at a local high school, or hold a parent seminar on how to teach money skills to children. Use the celebration to create a new generation of financially confident consumers, and have fun in the process."
 
Official National Credit Union Youth Week art, articles, and celebration materials will be available online in January. For the latest information on Youth Week, credit union staff may sign up for the free Youth Week e-Newsletter. Use the link.

Michigan Card Skimming Bill Now In Senate

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LANSING, Mich. (11/13/13)--A five-bill, bipartisan anti-card-skimming legislation package initiated by the Michigan Credit Union League is nearing completion in the Michigan legislature.
 
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 more. Within minutes, criminals can install a camera or other card reading device and PIN capturing device onto an ATM or other financial transaction device, and collect consumer personal information.
 
Currently, there are conflicting penalty provisions in state law that must be resolved, and jurisdictional adjustments are needed to facilitate easier prosecution, said the league (Michigan Monitor Nov. 11).

The legislation passed the House of Representatives unanimously last Thursday.  The Senate received the bills on Tuesday and referred them to the Senate Judiciary Committee, which reported the package unanimously later that afternoon. The MCUL will continue work with the Senate, aiming for final passage before the holiday season.

MCUL will monitor the package as it moves into the Senate.  Sen. Rick Jones (R-Grand Ledge), chair of the Senate Judiciary Committee, has indicated he will take the bills up in committee this week.
 
Also, league-supported legislation that would allow financial institutions to retain the primary homestead rate of taxation on residential property moved a step closer to passage last week.
 
The bill would allow financial institutions to pay a lower homestead tax rate for up to three years.
 
Senate Bill 532 passed out of the Senate Finance Committee with a unanimous bi-partisan vote. The bill will now go to the Senate floor for consideration by the full chamber. The league said it expects the legislation to be considered by the full Senate as early as next week.
 
In other legislative news, Michigan Gov. Rick Snyder signed two pieces of legislation last week that will require buyers of motor vehicles, recreational vehicles or titled watercraft to pay sales tax on the difference in price between price of the new vehicle and the trade-in.
 
The package, which includes Senate Bill 89 and House Bill 4234, amends the General Sales Tax Act (1933 PA 167) so sales tax eventually would be charged only on the difference between the price of a new or used motor vehicle, recreational vehicle, or titled watercraft and the agreed-upon value of any trade-in. The bills will be phased in over several years.
 
The package eliminates double taxation that took place when a vehicle, RV or titled watercraft was traded in for the purchase of a different one, said the league.

CUs Combat Elder Financial Abuse

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WASHINGTON, D.C. (11/13/13)--Credit unions from across the country are working to combat financial elder abuse and exploitation, said the Credit Union National Association Tuesday.

Americans over the age of 60 lost about $2.9 billion from financial abuse in 2010, up 12% from the $2.6 billion lost in 2008, according to research from insurance provider MetLife.

Credit unions are taking several steps to curb this escalating problem, including staff training to identify and report abuse, instituting new computer programs that can recognize irregular activity, and reaching out into the community to help educate vulnerable members about avoiding theft and fraud.

With the uptick in abuse, credit unions also are seeing more legislation designed to protect the vulnerable, aging population.  In the past two years, 22 states have enacted elder financial abuse legislation, which often requires financial institutions, including credit unions, to report suspected abuse. Credit union leagues have worked closely with state legislatures to ensure that these new reporting laws protect seniors while also ensuring individual privacy protection.

National Credit Union Administration Chairman Debbie Matz in a letter issued in September to credit unions (Letter 13-CU-08), strongly encouraged 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."
 
Here are examples of credit unions are fighting back against elder abuse:
  • Walnut Creek, Calif.-based Pacific Service CU was recognized by the NCUA in October for its role in fighting elder abuse. It sponsored the Elder Financial Protection Network, a San Francisco-based nonprofit organization that seeks to raise community awareness, and was praised for supporting state-wide forums as well as providing extensive staff and community training in abuse recognition and prevention.
  • In North Carolina, where new laws now allow credit unions to report fraud, the state league hosted a day-long summit that included panel discussions on the new reporting requirements, as well as best practices from credit unions and community banks on implementation.
  • The Montana Credit Union Network worked closely with the state legislature to create new laws to protect seniors. Its work included providing testimony in committees and working with law enforcement, interested parties and other consumer protection groups to ensure that the new legislation incorporated the perspective of financial institutions who are interested in reporting abuse. As a result, two new laws were passed this year that make it easier for prosecutors to prove a senior citizen has been the victim of fraud, and that added a penalty for violation of the Unfair Trade Practices and Consumer Protection Act if the victim is over 60 years of age.
  • At Fort Smith Dixie Cup FCU, Fort Smith, Ark., fraud prevention exists on a very personal level. Vicki Newton, CEO of the credit union, recalls a situation where an elderly member she knows well came into the credit union. The member was disoriented and needed help with a Medicare issue. Recognizing that the member's state of mind put her in a vulnerable position, Newton immediately called the member's son. "We're a small shop," Newton says. "And with a closed field of membership, it's easier to get to know our members and learn their financial habits. If something doesn't look right, I'm going to catch it."
  • In St. Paul, Minnesota, Terri Maloney, president of Catholic United Financial CU, has personal experience with identity theft and has made it her mission to help seniors in Minnesota by providing awareness and education. Since conducting her first presentation on identify theft at Catholic United's convention in August, Maloney has been invited to do six more.
  • Champion CU, Canton, N.C., hosted an Elder Fraud and Financial Exploitation Conference on Oct. 10. Speakers from the attorney general's office, state social services, the postal inspector (to speak about mail fraud) and the sheriff's department provided information about avoiding financial exploitation and scams.
  • In 2012, Bellco CU, Greenwood Village, Colo., partnered with the Filene Research Institute to pilot a new program called Senior Sentry, which takes proven indicators--or red flags--of elder financial abuse, and applies them in the monitoring of member account activity to generate alerts. The program, which has proven effective in preventing fraud, is exploring options for further development on a larger scale.

CU's $3M Donation Boosts University's Biz Development Hub

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ALBUQUERQUE, N.M (11/13/13)--New Mexico Educators FCU helped the University of New Mexico become one multimillion-dollar step closer toward opening a high tech research and business development center in downtown Albuquerque, N.M.
 
The credit union gave $3 million to the university's "Innovate ABQ" project. It is the first private financial commitment, the largest single donation, and the credit union's largest one-time gift to date (Albuquerque Journal Nov. 11).
 
The gift "is a long-term investment" that will bring significant returns to the community and credit union members "many times over in terms of improved opportunities and lifestyles in Albuquerque," New Mexico Educators FCU President/CEO Terry Laudick said, hailing the university's attempts to bring the public and private sectors together to "redefine" the state's economic landscape. He noted that this is what the credit union is chartered to do as a nonprofit cooperative--bring community resources together for the greater good.
 
The University of New Mexico Foundation is administering the donation, and has created a dedicated fund to allow more private sector and individual donations.
 
Before the credit union's $3 million donation, the city of Albuquerque committed a $2 million bond, which was approved by voters in October. The university is also expecting to receive a $1.5 million grant from the U.S. Economic Development Administration.
 
The gift appears to guarantee that the project will go beyond the drawing board, said the Journal. The University is keen on purchasing a seven-acre site, currently occupied by First Baptist Church, with an appraised value of $6.6 million--which the university, by law, has to pay.

Pep Rally To Kick Off 2014 CU Cherry Blossom Run

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WASHINGTON (11/13/13)--Preparations for the 2014 Credit Union Cherry Blossom Ten Mile Run will kick off with a credit union sponsor Pep Rally Nov. 20 at the National Building Museum in Washington, D.C.
 
Credit unions have been the title sponsor of the run since 2001 when they organized participation as a means of raising funds to benefit the Children's Miracle Network Hospitals through Credit Unions for Kids. To date, credit unions have donated over $6 million through their efforts.
 
The Pep Rally will focus on helping credit unions make the most of their participation in this year's run. A panel of credit union marketers will discuss ways credit unions can engage their members in fundraising and race participation while promoting credit union involvement within the community. 
 
This year, credit union sponsors will have additional opportunities to promote their credit union message directly to runners and spectators at the run, which takes place April 6.
 
The run also serves as a showcase for credit unions before lawmakers on Capitol Hill. Attendees will hear updates on the annual Capitol Hill competition for lawmakers and their staff. 
 
Credit union employees who are responsible for marketing, fundraising, running and volunteer coordination should attend. 
 
The National Building Museum is at 401 F St., NW, Washington, DC, directly across from Judiciary Square Metro Stop on the Red Line.  Credit unions can register to attend by e-mailing Credit Union Miracle Day Director Sarah Turner at sturner@mddcua.org.

Irish CUs Gain Access To Provide Electronic Payments

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DUBLIN (11/13/13)--Irish credit unions recently gained access to provide electronic payment services to their members through a license granted by the Central Bank of Ireland to the Credit Union Service Organization for Payments.

Click to view larger image World Council of Credit Unions representatives, from left Brian McCrory, director; Grzegorz Bierecki, chair; and Brian Branch, president/CEO, met with the Irish League of Credit Unions at its headquarters in Dublin Friday to gain a better understanding of the Irish system.
The new service will allow credit union members nationwide to electronically transfer payments from a bank, employer or social welfare office directly into their credit union account.
 
"The recent exit of multiple international banks from the Irish financial services sector means that there is a greater scope for Ireland's credit unions to offer a vital link between the Irish public and accessible, community-based financial services," said World Council of Credit Unions President/CEO Brian Branch during a visit last week to the Irish League of Credit Unions (ILCU), a World Council member. "A payments license will allow credit unions to begin to put a realistic not-for-profit alternative in place."
 
Branch and World Council's board of directors met with ILCU CEO Kieron Brennan and the ILCU board of directors to learn about challenges facing the nation's credit unions and the impact of an electronic payments service on members' ability to manage their current and future finances.
 
Click to view larger image A World Council of Credit Unions delegation visited Dundrum CU in Ireland for a presentation from its executive committee. (Photo provided by World Council of Credit Unions)   
"We believe that reforming our payments system will provide cost competitiveness, greater security and convenience for 3.1 million credit union members nationwide," Brennan said.
 
 The World Council delegation visited Dundrum CU for a presentation from its executive committee. 
 
Since the beginning of Ireland's historical recession in 2008, ILCU and Irish credit unions have faced economic difficulties, yet have remained a coherent social and economic force, said the World Council. Membership has grown steadily, which is partially due to increased access to loans.

As of 2012, Ireland had 487 credit unions serving 3.2 million members, according to World Council's most recent statistical report. A recent study by ILCU shows that consumers' confidence in credit unions is on the rise.

Mexico's UNISAP Visits Border FCU

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DEL RIO, Texas (11/12/13)--Representatives from Mexico's National Federation of Financial Cooperatives (UNISAP) visited Border FCU, Del Rio, Texas, on Nov. 4 and 5.  
 
Click to view larger image Representatives from Mexico's National Federation of Financial Cooperatives (UNISAP) visited Border FCU in Del Rio, Texas, Nov. 4 and 5. From left: Gerardo Santillan Garcia, chairman of UNISAP's board and board vice chairman of Caja Hipodromo in Durango, Durango, Mexico; Rosalba Carreno Cisneros, UNISAP vice chairman of the supervisory committee and executive director of Caja San Jose in Tlajomulco, Jalisco, Mexico; Jose Gabriel Gutierrez, executive director of UNISAP in Guadalajara, Jalisco, Mexico; Maria J. Martinez, president/CEO, Border FCU; Ramon Lopez, UNISAP board member and board member of Caja 15 de Mayo in Tecoman, Colima, Mexico. (Photo provided by Border FCU)
After a welcoming breakfast Nov. 4, UNISAP members toured BFCU's main office learned about Border FCU's products and services and its marketing and community outreach strategies. 
 
After lunch, the group visited BFCU's Laughlin Air Force Base branch and BFCU's HEB branch, which is currently under construction. The day's final stop was a visit to Del Rio's Val Verde Winery and dinner at the residence of BFCU President/CEO Maria Martinez, where the group was joined by BFCU's management team and about 15 representatives from Shreveport FCU who were also in Del Rio to visit BFCU to exchange ideas and learn how to better serve the Hispanic community.

On Nov. 5, UNISAP representatives visited BFCU's Gibbs branch, where the group learned about BFCU's financial counseling program and community outreach programs.  BFCU's information technology department showcased its services and BFCU's core, network and data communication systems. The group also learned about asset recovery and collections, and the duties and responsibilities of BFCU's board and supervisory committee, as well as the board meeting structure and agenda items.

Arizona State CU Honors Veterans With 27 Versions of Flag

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PHOENIX (11/12/13)--Arizona State CU, Phoenix, displayed at its corporate headquarters all 27 congressionally approved versions the American flag and a banner recognizing veterans for their service.
 
Click to view larger image Arizona State CU installs a banner and 27 American flags to recognize veterans for their service. (Photo provided by Arizona State CU)
"It is an honor to provide a symbolic tribute to our veterans thanking them for their years of service," said David E. Doss, CEO/president of Arizona State CU. "On behalf of Arizona State CU associates, we would like to wish our members and all veterans a happy Veterans Day."
 
The flags and banner will be displayed through Nov. 18 on the credit union's corporate headquarters for its Celebration of Veterans. The tribute banner and all 27 versions of the American flag will remain on display both day and night in recognition of the constant vigil servicemen and women keep over the country.

CU System Briefs (11/12/2013)

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  • PITTSFIELD, Mass. (11/12/13)--An Adams, Mass. woman received a four-year jail sentence after pleading guilty to stealing almost $60,000 from the Greylock FCU branch where she was head teller in Pittsfield, Mass.  (New England Newspapers Nov. 8). Felisa Kazimierczak, 44, initially claimed that an unidentified individual left a note on her car threatening to harm her daughter unless Kazimierczak delivered a substantial amount of cash to a nearby location. But police said the story was fabricated and that Kazimierczak embezzled the money by taking cash allocated for area ATMs and delivering it to the false drop off site after coercing a co-worker into standing watch while she was gone. Pittsfield police allegedly found a bag of cash in Kazimierczak's car totaling the amount missing from the vault, less $58,000, and learned she allegedly had moved money between ATMs shortly after an impending audit was announced by Greylock managers. A search of Kazimierczak's home allegedly yielded thousands of used lottery tickets. Assistant Berkshire District Attorney Richard M. Locke also said that Kazimierczak's family was heavily in debt. The $58,000 was never recovered, but Greylock FCU was insured for the loss so no members lost deposits. Kazimierczak pleaded guilty to kidnapping, larceny over $250, misleading a police officer, making a false crime report, and making false entries into corporate books. Greylock FCU has $1.129 billion in assets ...
  • RHINELANDER, Wis. (11/12/13)--Two credit union members in Oneida County, Wis., reported they were targeted by con artists via text message (WSAU.com Nov. 7). Oneida County Sheriff's Lt. Lloyd Gauthier said the pair filed complaints after receiving text messages purporting to be from their credit unions, stating that the members were approaching their credit limit and asking for credit card numbers and PINs so that the limit could be increased. Both individuals contacted their credit unions--Ripco CU and CoVantage CU--and were notified by employees that the texts were part of a scam. They contacted the police afterward. Ripco CU, based in Rhinelander, Wis., has $113.1 million in assets. CoVantage CU, based in Antigo, Wis., has $1 billion in assets ...
  • HARRISBURG, Pa. (11/12/13)--U.S. Rep. Lou Barletta (R-Pa.) (center) toured the new headquarters of Harrisburg-based Pennsylvania State Employees CU on Thursday, reported the Pennsylvania Credit Union Association (Life is a Highway Nov. 8). The facility, LEED (Leadership in Energy and Environmental Design) certified by the U.S. Green Building Council, has a natural gas powered cogeneration system; bicycle, high occupancy, and fuel efficient vehicle parking; a rooftop garden, and it maximizes natural light. PSECU Gregory Smith (left) said that the building "will give us the ability to grow and also provide better member service. Also pictured is PSECU Government Relations Manager Nate Muiz.  During the event, Barletta was also thanked by PCUA Vice President of Governmental Affairs Christina Mihalik for joining 117 of his colleagues in urging the Consumer Financial Protection Bureau to delay the January implementation of new mortgage rules ...

Maine CUs Hit Marketing Home Run During World Series

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PORTLAND, Maine (11/12/13)--A Maine Credit Union League website saw its traffic spike by 10% the day after the Boston Red Sox's World Series-clinching victory because league executives pulled off the marketing equivalent of knocking it out of the park.
 
During Game 6's victory Oct. 30, in the middle of the fifth inning, FOX 23 in Portland aired a 30-second advertisement promoting Maine's credit unions (Weekly Update Nov. 8). And the league didn't even have to pay a premium for getting the commercial placed.
 
League Assistant Vice President of Corporate Marketing Debra Trautman explained that the organization was able to cut a deal with the local FOX outlet because of an amicable history between the two organizations.
 
"Karen St. Clair, the long-time TV media buyer for your league, worked with FOX 23 earlier that day to negotiate that one of our 30-second commercials would, in fact, air during the World Series game," she explained in the league's newsletter.
 
"The opportunity came about because of several earlier pre-emptions of our spots," Trautman said. "Karen was able to leverage our relationship as a strong and consistent advertiser into having one of our commercials air during a time when hundreds of thousands of viewers were watching the game. It was really exciting to see our commercial air during a truly special event and to such a wide audience. It reinforces the value of relationships because our spot aired at no extra charge."

Cooperative Trust, CUNA Launch Crash the GAC 2014

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MADISON, Wis. (11/12/13)--The Cooperative Trust and the Credit Union National Association announced Monday that the application process for Crash the GAC 2014 is open. Applications are due Dec. 17, with decisions made in early January.
 
The Cooperative Trust, CUNA and state leagues/associations hope to attract 51 crashers--one crasher from each state and the District of Columbia-- at this year's Governmental Affairs Conference, which will be held in Washington D.C., Feb. 23-27.
 
Every crasher will receive a full conference registration from CUNA. If the chosen crasher's credit union can't cover all of the travel expenses, its league may provide some funding to help.
 
With more crashers than ever before, a deeper dive into the world of credit union advocacy, and support from state leagues, Crash the GAC will help arm young professionals with ideas to stay involved when they return home.
 
"Crash the GAC is an opportunity to give young credit union professionals a real insight into the wider credit union System and for them to engage and learn with likeminded young and experienced professionals alike," said James Marshall, leader of The Cooperative Trust.
 
"Now going into our fifth year of Crash the GAC, we are thankful to be partnering with CUNA to bring you the biggest crash event we've ever tried to pull off," Marshall said. "On top of that, the support from the state leagues and associations to ensure that their young professionals can attend the nation's foremost credit union event has been staggering. Bringing the focus to advocacy is key this coming year, with campaigns such as 'Don't Tax My Credit Union' going on, to make sure that our crashers head home knowing how important governmental affairs really are."
 
Crash the GAC will provide a tailored program alongside the main GAC event and mentor sessions with key individuals from National Credit Union Foundation, CUNA, National Credit Union Administration, Filene Research Institute and CUNA Mutual Group.
 
"I believe we need to develop next generation leaders to grow, promote and sustain the credit union movement," said Jill Tomalin, CUNA executive vice president and chief operating officer. "The CUNA GAC is the premier, annual, must-attend program for engaged credit union staff.  We look forward to working with The Cooperative Trust to expand the presence of young professionals in the 2014 Crash the GAC."
 
Use the link or email trust@trust.coop for more information about applying or about available sponsorships. The Crash the GAC is presented by The Cooperative Trust and CUNA, in association with credit union leagues/associations and sponsored by CUNA Mutual Group.

Affinity FCU Receives Grant To Fund N.J. Spanish Fin. Ed Program

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BASKING RIDGE, N.J. (11/12/13)--The Affinity FCU Foundation has been selected as this year's recipient of the Mary O'Neill Financial Literacy Mini Grant by the New Jersey Coalition for Financial Education to build a Spanish-language, culturally grounded, community-based financial education program in New Jersey.

According to the New Jersey Credit Union League, the coalition's mission is to improve the personal financial literacy of New Jersey's citizens by promoting the teaching of personal finance to people of all ages (The Daily Exchange Nov. 8). New Jersey's credit unions are the organization's premier sponsor through funds provided in part by the New Jersey Credit Union Foundation.

Affinity FCU is a $2.29 billion asset credit union based in Basking Ridge, N.J. Its foundation plans to develop a curriculum grounded in the culture and traditions of New Jersey's Hispanic community and deliver it through partnerships with community-based organizations serving those communities.

It will pilot the new program at the Morris County Organization for Hispanic Affairs' offices in Dover and Morristown and evaluated before a wider rollout.

"Affinity was selected for its direct outreach to an underserved population, exceptionally well written and realistic outreach methodology, realistic timeline, and well-reasoned evaluation methodology," said NJCFE Executive Director Michale K. Drulis.

"Having partnered with Affinity in the past, we are aware of their exemplary track record and are confident that the Affinity Foundation will provide invaluable, financial literacy programs to those who need them the most," Drulis said.

The program's goal is to provide personal financial skills and institutional support that many low- and moderate-income Hispanic families lack, and help families to save money, accumulate assets and minimize personal debt while fighting discrimination and avoiding predatory lenders.

Many of the families remain disconnected from mainstream financial institutions. Hispanics represent 17.5% of the population in New Jersey, but nearly 50% do not have a transaction account--a basic starting point in financial management and wealth-building, said the Affinity Foundation. It cited a recent study indicating that 43% of Hispanics said they knew nothing about these subjects. That compares with 12% of the overall population.

"This program will allow recent Hispanic immigrants to develop relationships with mainstream financial providers while gaining the experience with and exposure to basic financial tools that American families need in order to prosper," said Dr. Lauretta A. Farrell, executive director of the Affinity Foundation.

World Council Will Provide Relief To Haiyan Victims

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MADISON, Wis. (11/12/13)--In the wake of super typhoon Haiyan, one of the most powerful storms ever recorded to make landfall,  the World Council of Credit Unions is in contact with local authorities in the Philippines to assess how to best help the 4.5 million people affected.
 
According to the World Council's 2012 Statistical Report, there are 1,320 credit unions in the Philippines serving 4.3 million members. The World Council has committed resources, including donations made to the Worldwide Foundation for Credit Unions, to alleviate suffering of Philippine citizens who are credit union members.
 
The World Council also is set to provide disaster relief to credit union staff and support credit union rebuilding efforts following this latest disaster. Much-needed cash contributions from credit unions and individuals will provide assistance to those whose lives have been devastated by the disaster.
 
To support the international credit union disaster relief fund and rebuilding of Philippine credit unions, payments via check, credit card or wire may be sent to: Worldwide Foundation for Credit Unions, Inc., 5710 Mineral Point Road, Madison, Wis.  53705, or online at www.woccu.org /give. Contributors should indicate the donation is designated for Philippine Disaster Relief Fund.
 
According to reports, authorities fear as many as 10,000 people may have been killed by typhoon Haiyan and as many as 9.7 million may have been affected in the Philippines.
 
The World Council has led relief and rebuilding efforts during past international disasters, including the January 2010 Haitian earthquake, February 2006 Philippine Islands landslide, and December 2004 Asian tsunami. Following the Haitian earthquake, WOCCU led a $1.2 million dollar project to provide immediate relief, provide shelter and revitalize the country's credit union system. Following the 2006 Philippines landslide in Leyte, WOCCU supported the local league's administration of "livelihood loans," small microloans that helped credit union members and employees rebuild their homes and businesses.

Mortgage Bank Delinquencies Drop, Higher Than CU Delinquencies

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WASHINGTON (11/12/13)--Data released Thursday by the Mortgage Bankers Association show delinquency rates at a five-year low, but debtors who borrow from credit unions are still significantly less likely to find themselves in arrears.
 
The MBA's National Delinquency Survey found that the seasonally adjusted third-quarter delinquency rate for mortgage loans declined to 6.41%, the lowest since the second quarter of 2008.
 
That is more than 5% higher  than delinquency rates among similar credit union-originated loans. According to the Credit Union National Association's Monthly Credit Union Estimates for September, the 60-day delinquency rate for all loans issued by credit unions was 1% for the seven months prior. The delinquency rate in June for all mortgages loans issued by credit unions, according to CUNA, was 1.3%--1.36% for first-time mortgages, and 1.07% for home equity lines of credit and second mortgages.
 
While the data issued by CUNA and the MBA aren't directly comparable, they still indicate that credit union members have an easier time repaying mortgage loans than retail bank customers do.
 
The recent MBA data showed that the percentage of loans in the foreclosure process, at 3.08%, was even higher than the delinquency rate on any credit union mortgage loan. And while the MBA "serious delinquency rate"--the percentage of loans either with payments 90-days late or already in foreclosure--is down 1.38% over the last year, it's still at 5.65%.
 
The MBA also noted that the survey's delinquency rates might appear lower than they actually are because one large mortgage servicer doesn't participate in its survey.
 
Foreclosures are slowing down throughout the housing market, according to the MBA survey. The percentage of loans starting the foreclosure process fell by 0.03% in the third quarter to 0.61%--the lowest level since early 2007.
 
The MBA said that bank managers might find themselves issuing more pink slips as a result.
 
"Many mortgage servicers are already reducing staffs that handled delinquent loans and foreclosures, and we expect that trend to continue as the numbers continue to fall," said MBA Chief Economist Jay Brinkmann.
 
The MBA National Delinquency Survey has been conducted quarterly since 1972. It covers 40 million loans on one-to-four unit residential properties, which constitute more than four-fifths of all first-lien residential mortgage loans outstanding in the U.S.

BECU To Pay Stipends To Directors, Audit Committee

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SEATTLE (11/12/13)--The nation's fourth-largest credit union announced it plans to compensate its directors and Audit Committee members beginning in 2014.

Seattle-based BECU, which has more than 825,000 members and more than $11.5 billion in assets, informed members of the plans Nov. 5 on its News Center website. It noted that effective this past July 28, state law allows state-chartered credit unions such as BECU to reasonably compensate directors and Audit Committee members.

"Officials of all types of financial institutions have growing fiduciary and regulatory responsibilities that demand more time and work," said Todd Pietzsch, BECU manager of public relations. "The payment of stipends will help ensure that BECU continues to retain and attract individuals with board-level strategic and thought leadership.

"It was determined that it is in the best interest of BECU members, as well as consistent with our cooperative nature, to pay a modest stipend to officials that is lower than the median paid by other financial institutions of similar size."

BECU officials will be paid between $14,000 and $25,000 per year, effective Jan. 1, depending on each official's role on the board or committee, the credit union said. It conducted a market review with a third-party consultant to determine the level of the stipends. It also referred website visitors to a board nominations page. Elections will be held at its April annual meeting.

BECU Board Chairman Mike Sweeney, who has been on the board for nearly 10 years, told the Northwest Credit Union Association (Anthem Recap Nov. 8) that the credit union industry "is becoming more and more complex, requiring a very broad set of skills at the director level.

"Generally, our directors are expected to understand and assess this increasingly complex financial, business, legal and regulatory environment. We expect them to have executive-level business experience with a strong sense of community, previous nonprofit board experience and a passion for the credit union movement." He noted his community involvement, business experience and law background support his role on the board.

"This stipend is in recognition of the considerable time and effort our officials give in service to BECU," he said. "Payment of a modest amount to our officials also enhances our ability to attract and retain well-qualified individuals. Being on the BECU board carries with it an incredible fiduciary responsibility, not only to safeguard our members' assets, but also to ensure the future strategic direction of the credit union. Payment of a stipend is a small gesture in comparison."

The Credit Union National Association says that credit unions in nine states can currently pay at least one member of their board and 12 states allow for more comprehensive board compensation (News Now June 3).

Paper: Data Analytics An Eye-opener For CUs

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DES MOINES, Iowa (11/12/13)--Three credit card teams at credit unions in Illinois, Washington and Iowa discuss their eye-opening experiences with data analytics and provide advice in a new white paper released last week.
 
Data analytics is a long-term strategy in which results take many months to appear, said "The Data Analytics Experience," issued by Des Moines, Iowa-based payments processor The Members Group. But financial institution leaders are finding that analytics has the potential to change their entire culture of decision-making.
 
In the paper, IH Mississippi Valley CU, based in Moline, Ill., shares how data analytics enhanced its cash advances and balance transfer deals. The credit union's goal was to grow its credit card portfolio by 25% within one year. It offered two promotions to credit cardholders that included cash advances and balance transfer deals.
 
The $869 million asset credit union went against the grain with its strategy of offering deals only to cardholders identified as most likely to respond by TMG's partner, IQR Consulting. The consulting firm, instead of looking at one or two criteria, reviewed data from several sources, including credit bureaus, credit card statements, prior campaign results and checking account histories. It analyzed which categories of cardholders should receive which types of offers.
 
So far, the promotion has yielded more than $2 million in cash advances or about 10% of the credit union's entire portfolio.  "Our plan is to use data analytics to really dial into the people who use our cards to understand better what they need from us," said Curt Johnson, assistant vice president of mortgage and card services at IH Mississippi Valley CU.
 
Also in the paper, Spokane (Wash.) Teachers CU, with $1.7867 billion assets, tells how the successful use of segmentation strategies in its credit card portfolio influenced its other departments, and the $1.99 billion asset University of Iowa Community CU, Iowa City, Iowa, notes that data analytics helped take its already successful cards program to new levels.
 
"Data analytics is not reinventing the wheel; it's reshaping it," said the paper. "Often these strategies simply boost the results of programs a card team is already familiar with, like balance transfers, holiday promotions or line increase.
 
To download the free white paper, use the link.

CUNA Mutual Names Trunzo CEO To Succeed Retiring Post

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MADISON, Wis. (11/12/13)--Robert N. "Bob" Trunzo will be CUNA Mutual Group's next president/CEO, succeeding Jeff Post, announced CUNA Mutual Group's board Friday. Post is retiring and Trunzo's appointment will be effective Jan. 1.
 
Trunzo, who joined CUNA Mutual in June 2005, has held a number of senior leadership positions, most recently as president of CUNA Mutual Group Insurance and Financial Services. Trunzo becomes the company's eighth president in its 78-year history. 
 
"After a thorough succession planning process and extensive consideration, the Board of Directors is excited to have Bob carry on CUNA Mutual Group's rich tradition and execute our future strategy," said Eldon Arnold, board chairman.
 
"Bob is uniquely qualified to carry on the work we started nine years ago to help credit unions, their members, small business owners and America's farmers reach their financial goals" said Post. "He has been an integral part of what we built and is the best person to carry the vision forward."
 
Trunzo received his bachelor's degree in political science from the University of Kentucky and his law degree from Marquette University.  He also completed the Kellogg School of Management Executive Program at Northwestern University in 2011. 
 
A native of Louisville, Ky., Trunzo was Secretary of Commerce under former Wisconsin Gov. Tommy Thompson. He is a board member of the U.S. Chamber of Commerce and the American Council of Life Insurance.  He also served as chairman of the Southeast Wisconsin Professional Baseball Park Board, which oversaw the design, financing and construction of Miller Park, home of the Milwaukee Brewers. Trunzo and his wife, Anne, have three children.
 
In his role as president of CUNA Mutual Group Insurance and Financial Services, Trunzo was responsible for the products, distribution and service of the company's U.S. credit union businesses as well as its 401(k) business. He also was responsible for nearly 3,000 of the company's 4,500 employees and approximately $2 billion of CUNA Mutual Group's annual revenues.
 
"The Board of Directors is pleased with the progress and past successes of CUNA Mutual Group and looks forward to many more years of serving all of its stakeholders. Jeff will be assisting the Board and Bob to assure a smooth transition through July of 2014," Arnold said.
 
"It is an honor to be selected to succeed Jeff, and the previous leaders who have made CUNA Mutual an industry leader," said Trunzo. "I am energized and excited about the challenge."
 
Post joined CUNA Mutual Group in January of 2005. He led a multi-year transformation plan that repositioned the organization for success in the credit union marketplace and beyond. The plan included reinvention of CUNA Mutual Group's sales distribution model and its customer service, product and investment strategies.
 
As CUNA Mutual's eighth president, Trunzo follows a long line of leadership that included:
  • 1934-1945: Roy R. Bergengren, managing director of CUNA, CUNA Mutual and CUNA Supply Cooperative;
  • 1945-1955: Thomas W. Doig, managing director of CUNA, CUNA Mutual, and CUNA Supply Cooperative;
  • 1956-1973: Charles F. Eikel Jr., managing director of CUNA Mutual;
  • 1973-1988: Robert L. Curry, president of CUNA Mutual;
  • 1988-1995: Richard M. Heins, president of CUNA Mutual Insurance Society and CEO of its wholly owned U.S. subsidiaries;
  • 1995-2004: Michael B. Kitchen, president/CEO of the CUNA Mutual Group and Century Companies of America; and
  • 2005-2013: Jeff Post.

CUs Add More Mergers To the Consolidation Trend

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MADISON, Wis. (11/12/13)--Mergers continued to redefine the credit union landscape nationwide, as credit unions consolidate to meet an increasing burdensome regulatory environment and to continue serving the growing needs of their memberships.
 
The merger between San Antonio-based Firstmark CU, with $794 million in assets, and $20 million asset Southside CU, also of San Antonio, has been finalized. The credit unions expect to integrate operations by Dec. 1, the Cornerstone Credit Union League said (Leaguer Nov. 7). Leon Ewing, president/CEO of Firstmark CU, will continue to lead the combined organization.
 
Fire Police County FCU,with $97 million in assets, Fort Wayne, Ind., has merged with $4 million N&W FCU, New Haven, Ind., effective Nov. 1.
 
The National Credit Union Administration has approved the merger of $3.2 billion asset Visions FCU, Endicott, N.Y., with $81 million asset CTCE FCU, Reading, Pa., said the Pennsylvania Credit Union Association (Life is a Highway Nov. 4). The merger is scheduled to be finalized Dec. 1.
 
Erie (Pa.) FCU, with $380 million in assets, has merged with $6 million asset  Erie (Pa.) Flagship Community FCU, effective Nov. 1 (Life is a Highway Nov. 5). The merger will expand Erie FCU's presence in Northwest Pennsylvania and offer Erie Flagship Community FCU members additional financial products and services, including with online and mobile banking.
 
McKee CU, with $14 million in assets in Collegedale, Tenn., has merged into Western FCU, Manhattan Beach, Calif. In addition to the current McKee Branch, members now have access to Western's network of 43 multi-state branch locations, including five branches in Northwest Arkansas.
 
Capitol Region FCU, with $30 million in assets, Wethersfield, Conn., has merged into $194 million asset Dutch Point CU, also of Wethersfield.
 
SIR FCU, with $77 million in assets, Negaunee, Mich., is merging with $469 million asset Honor CU, St. Joseph, Mich. (SunnyFM Oct. 11).
 
United Services CU, with $60 million assets, Ashville, N.C., has merged into Durham, N.C.-based Self-Help CU, with $583 million in assets (MarketLine Oct. 1).
 
The Massachusetts Division of Banking has approved the merger of $90 million asset River Works CU, Lynn, Mass., with $6 million asset Delta-Wye FCU, Dorchester, Mass. Under the terms of the agreement, Delta-Wye will be retained as a branch office of River Works CU.

Trunzo To Succeed Jeff Post As CUNA Mutual Group President/CEO

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MADISON, Wis. (11/8/13)--CUNA Mutual Group today announced that Robert N. "Bob" Trunzo will be its next president/CEO, succeeding Jeff Post, who is retiring.  The appointment is effective, Jan. 1, 2014.
 
Since joining CUNA Mutual Group in June 2005, Trunzo has held a number of senior leadership positions, most recently as president of CUNA Mutual Group Insurance and Financial Services. Trunzo becomes the eighth president of CUNA Mutual Group in its 78-year history. 
 
"After a thorough succession planning process and extensive consideration, the Board of Directors is excited to have Bob carry on CUNA Mutual Group's rich tradition and execute our future strategy," said Eldon Arnold, board chairman.
 
"Bob is uniquely qualified to carry on the work we started nine years ago to help credit unions, their members, small business owners and America's farmers reach their financial goals.  He has been an integral part of what we built and is the best person to carry the vision forward," Post said.

In his role as president of CUNA Mutual Group Insurance and Financial Services, Trunzo was responsible for the products, distribution and service of the company's U.S. credit union businesses as well as its 401(k) business. Trunzo was responsible for nearly 3,000 of the company's 4,500 employees and approximately $2 billion of CUNA Mutual Group's annual revenues.
 
"Jeff will be assisting the Board and Bob to assure a smooth transition through July of 2014," Arnold said.
 
Post joined CUNA Mutual Group in January of 2005. He led a multi-year transformation plan that repositioned the organization for success in the credit union marketplace and beyond. The plan included reinvention of CUNA Mutual Group's sales distribution model and its customer service, product and investment strategies.

More detail will be provided in Tuesday's News Now.

Michael Reagan On CUs' Success: 'It's About Grassroots'

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FREEPORT, Maine (11/8/13)--President Ronald Reagan's eldest son exhorted the value of member-controlled organizations at the Maine Credit Union League's 19th Annual Legislative Forum on Wednesday.
 
Click to view larger image Michael Reagan, center, President Ronald Reagan's oldest son and heir to his legacy and vision, was keynote speaker at the Maine Credit Union League's Annual Legislative Forum Wednesday. From left are: Roger Sirois, chair of the league's Governmental Affairs Committee; Tucker Cole, chair of the League's Political Involvement Committee; Reagan; John Murphy, league president; Quincy Hentzel, league director of governmental affairs; and Jon Paradise, league assistant vice president of governmental and public affairs. (Photo provided by the Maine Credit Union League)
Michael Reagan, an author and former talk show host, told the 125 credit union representatives gathered at the meeting, that the defining features of the industry's model are often borrowed by savvy politicians.
 
"Credit unions are about grassroots and successful politics is, too," he said. "You don't focus on the interests of a few; you focus on the interests of all of your members.  That is how it should be and was one of the reasons why my father was successful.
 
"I applaud what credit unions have done to serve your members," he commented, "especially in light of the how poorly big banks have treated their customers in recent years."
 
Reagan added that he believes his father would not win the presidential nomination in today's Republican Party.
 
"My father believed and I believe that politics requires compromise and working with people of all political beliefs," he said. "That is not only not being done today; in fact, it is frowned upon and that is a sad commentary on politics today,"
 
League President John Murphy said that he appreciated Reagan's insight.
 
"Michael Reagan really connected with the audience, and gave a wonderful presentation by sharing some intimate stories from his father's presidency, which the audience appreciated," he said. "Though President Reagan was discussed at length, Michael did a masterful job of bringing it all together to make it relevant in today's political environment."
 
The gathering also featured a foreclosure panel with three state legislators--Sen. Linda Valentino, Rep. Sharon Treat, and Rep. Jarod Crockett. The trio discussed foreclosure in the state and asked for feedback. League representatives said they believe foreclosure will be a hot-button issue throughout the next legislative session, and anticipate having a significant role throughout the legislative process.

CUs Have Presence At BAI

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DENVER (11/8/13)--
Click to view larger image Peter Alvarez, emerging markets manager for Redstone FCU, Huntsville, Ala., and Laura Castro de Cortes, vice president of alternative financial services for Centris FCU, Omaha, Neb., discussed their success in serving the underserved Wednesday at BAI's Retail Delivery Conference in Denver.
Credit unions had a presence at the BAI Retail Delivery Conference, which met in Denver this week, both as participating panelists and attendees.
 
A panel on serving the underserved featured Peter Alvarez, emerging markets manager for Redstone FCU, a $3.5 billion asset credit union based in Huntsville, Ala., and Laura Castro de Cortes, vice president of alternative financial services for $512 million asset Centris FCU,  Omaha, Neb.
 
"About 40% of the households in the Huntsville, Alabama, area are either unbanked or underbanked," Alvarez told those attending the session.
 
Redstone FCU created Right Choice Money Services outlets to serve primarily Hispanics in the Huntsville area., said Alvarez. "We're a credit union," he said. "Our mandate is to serve people of modest means."
 
Click to view larger imageCelent Senior Analyst Bob Meara (left) presented research on consumers' use of branches at BAI's Retail Delivery Conference Wednesday. Steve Kubala, senior vice president and chief operating officer of University FCU in Austin, Texas, discussed his credit union's innovative self-service model blending technology, culture, and organizational change.
In a session on consumers' use of branches, Bob Meara, senior analyst with Celent, presented research on the topic. Celent is a research and advisory firm that helps financial institutions with business and technology strategies.
 
Also in that session, Steve Kubala, senior vice president and chief operating officer of  the $1.64 billion University FCU in Austin, Texas, talked about his credit union's innovative self-service model that blends technology, culture, and organizational change. In its first six months, the initiative saved more than $400,000 per branch in annual operating costs and more than doubled sales productivity, he said.

The credit union was named a Celent Model Financial Institution in 2013.
 
Click to view larger image Belinda Caillouet (right), chair of the CUNA Technology Council and vice president of IT for Spokane (Wash.) Teachers CU, presents the council's Best of Show Award to Mitek--a mobile banking imaging software innovator. Accepting the award at BAI's Retail Delivery Conference is Keith Gray, vice president of sales for Mitek. Looking on is BAI CEO Debbie Bianucci.
Also at the conference, CUNA Technology Council presented its Best of Show Award to Mitek, a mobile banking imaging software provider.

Earlier this fall, Mitek introduced a mobile photo account opening product that captures a picture on the front and back of a driver's license and the validated data is automatically populated into an application to open an account (News Now Sept. 11).
 
Other activities during the conference included:
  • Peter Sheahan, author of the best-selling books FL!P and Generation Y, who told conference attendees during Thursday morning's general session that consumers want to do business with companies that solve problems for them.  That means your company's'  brand should promise to solve problems, he said. "It's important that your financial institution take more controlled risks because action always precedes clarity," Sheahan added.
  • Click to view larger image Peter Sheahan, author of FL!P and Generation Y, told BAI's conference that
    brands should promise to solve problems. (Photos provided by CUNA)
    Steve Chen, co-founder of video sharing website YouTube, which has more than 6.3 million followers on Google +, who discussed theories of innovation in a panel session with Brian Wong, co-founder and CEO of Kiip!, a mobile rewards network.  "Every minute, 18 hours of content are uploaded to YouTube," Chen told attendees during the session, which was moderated by  Sheahan.
The conference ended Thursday.

Texas Lawmakers: CU Political Involvement Important

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WICHITA FALLS, Texas (11/8/13)--
Former Texas state legislator and current Texoma Community CU board member David Farabee speaks at a meeting of the Wichita Falls Chapter of the Cornerstone Credit Union League.
A Texas state legislator recommended to a Wichita Falls Chapter meeting of the Cornerstone Credit Union League that credit unions get engaged in the political process because being disengaged could prove extremely consequential (The Advocate Nov. 6).
 
State Rep. James Frank (R-Wichita Falls) told about 60 credit union representatives at the meeting last week that credit unions could influence multi-tasking lawmakers by familiarizing themselves with parliamentary process and legislation. He added that they could do it effectively through trade association groups like Cornerstone Credit Union League.
 
"One of the penalties of refusing to participate in politics is that you end up being governed by your inferiors," he said, quoting Plato.
 
Among those attending the Wichita Falls, Texas, credit union chapter meeting last week were, from left: Christina Alvarez, Wichita Falls Teachers CU; Chantel Brooks, Union Square FCU; Stephanie Snider, Wichita Falls FCU; Julie Farr, Postel CU; Rep. James Frank (R-Wichita Falls); Kate Donovan, Texoma Community CU; and Elizabeth Schenk and Henny Barron, Windthorst FCU. (Photos provided by the Cornerstone Credit Union League)
 
Frank's message was echoed by former Texas state representative and current Texoma Community CU board member David Farabee. "If you're not involved, then government will happen to you, not for you," he said.
 
Farabee also recalled appreciating the positive impact credit unions made in helping him campaigning during two tight races that he won. He said he was certain it was the local credit union folks who walked blocks for him that made the difference in the race's outcome.
 
Following the dinner, Jim Phelps, Cornerstone vice president of advocacy, gave a 15-minute presentation, which included an update on the Credit Union National Association's and the leagues' "Don't Tax My Credit Union" campaign," and recommended Wichita Falls credit unions to involve themselves with Cornerstone's lobbying efforts.

Michael Reagan On CUs' Success: 'It's About Grassroots'

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FREEPORT, Maine (11/8/13)--President Ronald Reagan's eldest son exhorted the value of member-controlled organizations at the Maine Credit Union League's 19th Annual Legislative Forum on Wednesday.
 
Click to view larger image Michael Reagan, center, President Ronald Reagan's oldest son and heir to his legacy and vision, was keynote speaker at the Maine Credit Union League's Annual Legislative Forum Wednesday. From left are: Roger Sirois, chair of the league's Governmental Affairs Committee; Tucker Cole, chair of the League's Political Involvement Committee; Reagan; John Murphy, league president; Quincy Hentzel, league director of governmental affairs; and Jon Paradise, league assistant vice president of governmental and public affairs. (Photo provided by the Maine Credit Union League)
Michael Reagan, an author and former talk show host, told the 125 credit union representatives gathered at the meeting, that the defining features of the industry's model are often borrowed by savvy politicians.
 
"Credit unions are about grassroots and successful politics is, too," he said. "You don't focus on the interests of a few; you focus on the interests of all of your members.  That is how it should be and was one of the reasons why my father was successful.
 
"I applaud what credit unions have done to serve your members," he commented, "especially in light of the how poorly big banks have treated their customers in recent years."
 
Reagan added that he believes his father would not win the presidential nomination in today's Republican Party.
 
"My father believed and I believe that politics requires compromise and working with people of all political beliefs," he said. "That is not only not being done today; in fact, it is frowned upon and that is a sad commentary on politics today,"
 
League President John Murphy said that he appreciated Reagan's insight.
 
"Michael Reagan really connected with the audience, and gave a wonderful presentation by sharing some intimate stories from his father's presidency, which the audience appreciated," he said. "Though President Reagan was discussed at length, Michael did a masterful job of bringing it all together to make it relevant in today's political environment."
 
The gathering also featured a foreclosure panel with three state legislators--Sen. Linda Valentino, Rep. Sharon Treat, and Rep. Jarod Crockett. The trio discussed foreclosure in the state and asked for feedback. League representatives said they believe foreclosure will be a hot-button issue throughout the next legislative session, and anticipate having a significant role throughout the legislative process.

Assets, Net Worth Rise At Wis. State-chartered CUs

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MADISON, Wis. (11/8/13)--State-chartered credit unions are growing in Wisconsin, according to the Wisconsin Department of Financial Institutions.
 
Data from the state regulator showed that the credit unions saw assets grow by 5.7% to $24.45 billion, and aggregate net worth edge up to 10.43% in the first three quarters of 2013. After the same period in 2012, state-chartered credit unions had a net worth of 10.09% and cumulative assets worth $23.13 billion.
 
The Wisconsin DFI also found that credit unions regulated in Madison saw loan portfolios grow by 5.8% to $17.9 billion, with half of the growth in real estate financing, and loan delinquency reaching a six-year low, falling to 1.17% at the end of the third quarter in 2013 from 1.5% at the end of the third quarter in 2012.
 
State-chartered credit unions did see net income fall by 0.1% between the third quarters of 2012 and 2013. But DFI Secretary Peter Bildsten said that net income is still robust, with net worth rising and loan delinquency rates dropping.
 
Kim Santos, director of the Office of Credit Unions at DFI, also noted that credit unions' cost of funds fell by almost $22 million, or 20.2%, in the first three quarters this year. She hailed the trend as "critical" with interest rates low throughout the financial sector.

Filene Report To CUs: Create Community, Integrated Social Media Presence

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MADISON, Wis. (11/8/13)--"You don't win in social media just by showing up. While using Facebook or Twitter might have been buzzworthy in 2009, today's members are not impressed with mere presence. If they don't sense a purpose in your efforts, they will not pay attention." So says a new study from the Filene Research Institute.
 
Many credit unions are discovering that deep member engagement with social media comes only after a lot of work, said Filene's report, "From Presence to Purpose: Developing Social Media Strategies and Metrics for Credit Unions."  It studied 157 credit unions with social media programs.  Its conclusion:  Credit unions need to create community and an integrated social media presence.
 
Of the 157 credit unions studied, nearly 40% are "prospectors" who stake a social media claim but don't do much with it; more than half are "flirts," who approach social media sporadically, without long-term commitment, and 10% are "settlers" who stick around and finish what they started. Seven percent become MacGyvers, able to use a variety of tools to accomplish their social media goals.
 
The study's authors, Hope Jensen Schau, Ph.D.,  of the University of Arizona and Per Ivar Schau of the Carondelet Health Network, address two pressing challenges for credit unions:
  • Integrating legacy marketing/member service relationships with social media. This involves educating credit union decision makers about the role and purpose of social media and how it interconnects with the credit union's overall strategic branding decisions. This includes moving from a minimal social media presence to an active, value-added social media engagement; identifying and engaging the appropriate member base; and incorporating measurements of success.
  • Addressing the often missed credit union opportunity of data gathering and analysis. This entails developing appropriate metrics against which social media strategies can be evaluated. Using metrics and dashboards to access social media strategies and branding efforts helps resource-constrained employees locate quick strategic wins, said the report.
The report noted that all credit unions studied have unique websites, some with specific branch websites. Nearly all have member login prompts that lead to online banking systems from the corporate landing page. About half the credit unions surveyed use Twitter and YouTube, while 93% have at least one Facebook presence. Roughly 16% of those studied have blogs devoted to the credit union. The credit unions' most effective engagement strategy was with Twitter, which suggests credit unions may benefit from devoting more time and attention to social media strategies using Twitter.
 
The study recommended that credit unions looking to effectively use social media should work on creating community, use social media platforms for their respective strengths, support value-creating practices and encourage member-generated content.
 
For more information from the report, use the link.

Monday a Federal Holiday, CUNA Open, No News Now

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WASHINGTON and MADISON, Wis. (11/8/13)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be open Monday, which is a federal holiday, Veterans Day.  However, News Now will not publish a Monday issue.
 
News Now will resume regular publication Tuesday.

San Diego CU-sponsored Poinsettia Bowl Game Set For Dec. 26

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SAN DIEGO, Calif.  (11/7/13)--A college football bowl game sponsored by San Diego County CU is set to take place the day after Christmas.

The San Diego County CU Poinsettia Bowl, which has been sponsored by San Diego's largest locally owned credit union since it was first held in 2005, will be broadcast both on ESPN television and radio networks.

"We're looking forward to the big game," said San Diego County CU President/CEO Teresa Halleck. "SDCCU's support of this bowl game benefits the entire credit union industry through increased awareness. Credit union customers across the country also are reminded that credit unions contribute to our lives and communities in tangible ways."
 
Also, the game will feature new teams over the next six years. In a separate announcement, the Mid-American Conference said Wednesday it has entered a partnership with game organizers.

The conference will act as a primary partner in 2017 and 2019, and as a secondary partner for the 2014, 2015, 2016, and 2018, said the Miami University Athletics website. A team from the MAC will play a team from the Mountain West Conference in the 2017 and 2019 seasons.
 
The Poinsettia Bowl is the only game among the 35 college football bowl games to have a credit union as a title sponsor.

CU System Briefs (11/07/2013)

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  • GRAND RAPIDS, Mich. (11/7/13)--A 41-year old man who asked a plainclothes police officer for a ride has been arrested in connection with the earlier robbery of Kent County CU. Court records show that the detective declined the request and called for backup. The suspect, Marcus Ewing, allegedly admitted to robbing the credit union, saying a back injury and post-traumatic stress disorder have left him unable to work, and that he needed money for child support and a drug habit (The Grand Rapids Press Nov. 5). His cousin, Dontray Jones, 36, also was arrested as an accomplice. Both were arrested shortly after the robbery, when an anonymous tipster called 911 and followed the suspects' vehicle. Police found the car several blocks from the Kent County branch with a bag full of money, a black handgun, a costume beard, and Ewing's Indiana driver's license inside. Kent County CU, based in Grand Rapids, Mich., has $40 million in assets ...
  • KERNERSVILLE, N.C. (11/7/13)--Amazon shoppers will be able to give money to the Carolinas Credit Union Foundation this holiday season. The foundation will be listed as a "charity of choice" through the online retailer's AmazonSmile program. The set-up allows customers to direct 0.5% of purchases to a listed charity. The Carolinas Credit Union Foundation is the charitable arm of the North Carolina Credit Union League and the South Carolina Credit Union League ...
  • FORT WORTH, Texas (11/7/13)--
    Click to view larger image Click for larger view
    American Airlines FCU raised $55,000 in a charity golf tournament for Children's Miracle Network Hospitals. The gift will be divided among Cook Children's Medical Center Foundation and Children's Medical Center Foundation. American Airlines FCU has held its Annual Credit Union Golf Tournament for 17 consecutive years. The event was co-sponsored by credit union vendors and partners CO-OP Financial Services Network, Global Vision Systems Inc., Symitar and PSCU. The gift was presented by American Airlines FCU President/CEO Angie Owens and its golf tournament director Tish Pruitt to Children's Medical Center of Dallas and Cook Children's Health Foundation Annual Giving at AAFCU's Fort Worth, Texas, headquarters.  Since 1996, credit unions have raised over $100 million for Children's Miracle Network Hospitals. CO-OP Financial Services matched American Airlines FCU's gift with a $10,000 donation. Pictured are, from left: Cook Children's Health Foundation Annual Giving Specialist Natalie Houghton, Pruitt, Owens and Children's Medical Center of Dallas Sponsor Relations Representative Angela Bynum. (Photo provided by American Airlines FCU) ...
  • ST. LOUIS, Mo. (11/7/13)--Former Missouri Credit Union Association Board member Evelyn Mae Schuerman died at the age of 93 on Oct. 24, according to MCUA  (Missouri Difference Nov. 6). She had served on the MCUA board from 1966 until 1988, and was chair of the board from 1983 until 1985. Schuerman had worked for Conservation Employees CU, Jefferson City, for 20 years before retiring in 1986 as manager. She then worked as a treasurer for the Association of Retired Missouri State Employees until 2008 ...

Innovation Happens At the 'Click Moment'

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DENVER (11/7/13)--
Click to view larger image Frans Johansson--author of "The Medici Effect" and "The Click Moment"--was the keynote speaker Tuesday at BAI's 2013 Retail Delivery Conference in Denver.
"When trying to achieve success, we tend to rely on logic," said Frans Johansson, author and CEO of The Medici Group. "But logic doesn't give you a competitive advantage. If you rely on logic, you and all your competitors will end up in the same place."

Johansson--author of "The Medici Effect" and "The Click Moment"--was the keynote speaker Tuesday at BAI's 2013 Retail Delivery Conference in Denver.

Through his study of innovation and transformative ideas, Johansson concludes that "success is often random and serendipitous--it happens at 'the click moment.' If success is so unpredictable, can we really plan for success?"

"The purpose of strategy is not to figure out the right answer," Johansson said. "The purpose of strategy is to convince ourselves to act."

Johansson gave conference attendees, including credit unions and other financial institutions, this to-do list:
  • Borrow an idea from another industry. "All new ideas are combinations of existing ideas," he said.
  • People who change the world try far more ideas than others. "Your job is to bring down the cost of those trials."
  • Make sure you're adequately staffed for innovation.
  • Rethink risk management around innovation.
Click to view larger image As you engage in the process of radical collaboration "you have to be comfortable with being a little uncomfortable," said Matt Krogstad (left), vice president and head of mobile at Bank of the West in Denver, describing how the bank rolled out its full suite of mobile banking services. Others on the panel at the BAI's 2013 Retail Delivery Conference in Denver included Bank of the West executives Gina Wolley, executive vice president of regional banking, and Michael Manowski, senior vice president of solution delivery. (Photos provided by CUNA).
The conference also addressed the use of "radical collateralization" in introducing new products.
 
As you engage in the process of radical collaboration "you have to be comfortable with being a little uncomfortable," said Matt Krogstad, vice president and head of mobile at Bank of the West in Denver. The bank created a process it calls "radical collaboration" to roll out its full suite of mobile banking services a few years ago.

Its four-step, radical-collaboration process involves:
  1. Maximizing the partnership between technology and the business;
  1. Truly engaging the compliance, legal, and operational-risk teams as your partners in avoiding 'innovation prevention';
  1. Earning and maintaining the support of your executive team; and
  1. Squeezing every ounce of value out of the innovation, which sets the stage for the next round.

In Auto Lending, Get In Front Of Members Early And Often

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PHOENIX (11/7/13)--People consider buying a vehicle and borrowing money to do so as one event, making it crucial for credit unions to engage members early and often in the car-buying process.
 
Click to view larger image Loan preapprovals are key for both borrowers and dealers, Bob Child, chief of staff at  lending solutions provider CU Direct Corp., told attendees at CUNA Lending Council's 19th annual conference in Phoenix this week.  He also noted it is important to have good working relationships with auto dealers. (Photo provided by CUNA)
So says Bob Child, chief of staff at CU Direct Corp., citing a study the company conducted earlier this year that examined consumers' most recent car-buying experiences. He addressed the 19th annual CUNA Lending Council Conference in Phoenix.
 
"We need to get to consumers early and have better relationships with auto dealers to be successful in influencing their loan decisions," Child said.
 
This will require providing information that helps consumers as they shop for vehicles, and making it easy to get loans on the spot.
 
Preapprovals are the key, for both the buyer's and dealer's convenience, Child said.
 
He noted auto sales growth rates have returned to normal: 9% for new vehicles and 4% for used vehicles in 2013.
 
And while some industry experts say auto sales growth will fall to 4% for new vehicles and 1% for used vehicles, he cited a dealer group that believes auto sales growth in 2014 will mirror this year's growth.
 
"We're excited about that," Child said, adding the nation's aging fleet of vehicles is fueling sales growth. The average age of vehicles on the road is 10.9 years, he said. "There are a lot of car buyers in this group," he says.
 
Other factors affecting auto lending in the coming months:
  • More rationality in lending. Approval rates for subprime loans has dropped substantially, "which bodes well for the industry," Child said.
  • Longer loan terms, driven by rising car prices. The average purchase price for vehicles financed through CU Direct is $30,500. "Even with low rates, the payment for that amount is still high," he says. That will make auto loan terms of 72 months and longer more common.
  • Higher rates for subprime borrowers to compensate for thin margins on loans to prime borrowers.

Schenk To Council: Expect 'Slow and Unsteady' Recovery

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PHOENIX (11/7/13)--Credit Union National Association Senior Economist Mike Schenk joked that each time he addresses the CUNA Lending Council's annual conference, he has better and better news.
 
Click to view larger image Lenders will feel added pressure to boost interest margins in 2014, and new-auto loans will be a sweet spot for credit unions next year, said Mike Schenk, vice president of economics and statistics at the Credit Union National Association, Tuesday at the 19th Annual CUNA Lending Council Conference in Phoenix. (Photo provided by CUNA)
It was no different Tuesday at the 19th annual CUNA Lending Council Conference in Phoenix, although there's still room for improvement.
 
Most business leaders believe the economy is improving, he said. But a recent Gallup survey found that only 33% of consumers believe that's the case--and 62% believe the economy is worsening.
 
"That's a shocking statistic 52 months into economic recovery," said Schenk, CUNA's vice president of economics and statistics.
 
This consumer pessimism and other indicators, namely slow economic growth and stubborn unemployment, point to a "slow and unsteady recovery," Schenk said.
 
He cited three key issues affecting the economy:
 
1. We haven't reached our key economic goals. The economy is limping along at a 2.5% growth rate versus historical growth of 3.25%, and growth is likely to decline during the third quarter.

The unemployment rate remains at 7.2%, lagging the traditional long-term average of 6.5%. While there have been job gains, they're relatively weak: 148,000 new jobs were created in September, not enough to lower the unemployment rate. Schenk estimated there are two million fewer jobs today than in 2007. He says the labor market should be at normal employment by the third quarter of 2014.
 
2. Persistent weakness. Gross domestic product (GDP) growth normally would be 4.3% three years after a recession, but it lingers at 2.4%, Schenk said. That's largely because the economy is entering the third phase of deleveraging since the Great Recession. This first phase was businesses deleveraging, followed by consumer deleveraging. "Consumers represent 70% of our economic activity, which is a huge drag," Schenk said. The good news: Consumer deleveraging is ending. The bad news: Federal government deleveraging is just beginning--and will take 1.5% of the nation's economic growth with it.
 
Other potential land economic landmines include the possible scaling back of the Federal Reserve's quantitative easing program, and the prospect of continued debt ceiling fights, which could have serious consequences, Schenk said. "These multiple hits are having a dramatic effect on peoples' outlook and willingness to spend money," he said.
 
3. There are positive economic signs. The economy continues grow, albeit slowly, and "there's no inflation in sight," which is good for short- and long-term interest rates, he noted.
 
Consumers are holding steady on employment and income, and there's pent-up consumer demand, especially in auto sales. "That should be a sweet spot for credit unions," said Schenk. "The average age of cars on the road is almost 11 years."
 
Plus, housing prices are on the rebound, having risen 4.4% year-to-date, and many consumers have benefitted from large stock market gains. "This improves consumer spending," as does consumer deleveraging, he said.
 
There also are positives for credit union lenders, such as vastly improved asset quality, high earnings despite low net-interest margins, and strong membership growth (2.1%).
 
"It's clear that consumers are discovering and appreciating the credit union difference," Schenk said.
 
Despite tepid overall loan growth, Schenk said there will be dramatic improvements in new- and used-auto lending.
 
But credit union lenders will feel the pressure to improve net-interest margins as noninterest income declines. "The pressures put on you will become more dramatic," he warned. "Going forward, the return on assets of 84 basis points in 2012 will be a high watermark.
 
"Overall, it's good news," Schenk continued. "We're almost there. The future looks brighter now than it did a year ago."

Growing Business Loans After the Recession

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DENVER (11/7/13)--
Click to view larger image Charles Wendel, president of Financial Institution Consulting, addressed lending to small businesses Tuesday at the BAI's 2013 Retail Delivery Conference in Denver.
"Bankers are spending too much time at their desks and not enough time out with their small-business accounts," said Charles Wendel, president of Financial Institution Consulting. Wendel spoke Tuesday at the BAI's 2013 Retail Delivery Conference in Denver.

"Following the recession, banks have created a very narrow box within which they'll lend," said Wendel. "That has created an opportunity for other lenders to come in and make those loans."

He gave this five-step approach for making more small-business loans:
  • Click to view larger image Debbie Bianucci, president/CEO of the Bank Administration Institute (BAI), welcomed attendees to the second day of BAI's Retail Delivery Conference in Denver Wednesday. "We are so 'heads-down' on regulatory compliance that we need to lift our heads up and look around for opportunities to be innovative," she said. (Photos provided by CUNA)
    Define your focus through differentiation (but not on price). "Your institution can differentiate itself on its relationships with its clients, its industry specialization, or its product expertise," said Wendel.
  • Organize for success. Can your branches recognize quality loan opportunities? Is branch staff adequately trained? Do branches operate with loan liaison contacts?
  • Develop an efficient infrastructure. Reduce and simplify your products, evaluate all internal processes, outsource when possible, establish a consistent brand.
  • Determine key metrics. Identify internal and market needs. Who needs to be involved in setting metrics? What are the right metrics and who enforces them? When should you change metrics? What does the scorecard look like?
  • Create guiding principles for lending execution. Involve senior management. Agree on consistent job definitions. Implement a rigorous sales-management system. Don't place current staff in business lending positions.
Credit unions are urging Congress to raise their member business lending cap to 27.5% of assets from the current 12.25%. Doing so would inject $13 billion into the economy through small business loans and help create 140,000 jobs, at no cost to the taxpayer, says the Credit Union National Association.

MY CU Services Issues Transaction Challenge: Free Bill Pay For Year

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MIDDLETOWN, Pa. (11/7/13)--MY CU Services, a credit union service organization of Mid-Atlantic Corporate FCU, Middletown, Pa., is giving away free bill payment for a year to the credit union that grows its electronic bill payment transactions by the largest percentage from 2013 to 2014. 
 
The winner of The Great Transaction Challenge will receive free bill payment up to $5,000   during 2015.
 
"In today's world, consumers expect technology solutions from their financial institutions, which includes electronic bill payment," said Jaime Agostino, MY CU Services marketing manager. "This competition is designed to make sure members and potential members know that their credit union is a place where current technology meets great service."
 
The contest challenges credit unions to highlight the different features of MY CU Services' bill payment system, such as person-to-person (P2P) payments, eBills, donations and gift checks to help grow transaction volume.  Participating credit unions have access to a resource site containing marketing templates to help promote electronic bill payment to members.
 
All of MY CU Services' clients taking part in the electronic bill payment program since Oct. 1, 2012, are eligible to participate.

Minnesota CUs Provide Financial Counseling, Education To Members

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ST. PAUL, Minn. (11/7/13)--Credit unions in Minnesota formed a statewide partnership with a charity's financial counseling arm to offer additional financial advice and education.
 
The Minnesota Credit Union Network announced the deal with Lutheran Social Service on Tuesday, hailing its potential benefit to the state's credit union members.
 
"Credit unions are flocking to provide counseling services to their members because they understand the needs of today's consumers," said MnCUN President/CEO Mark D. Cummins. "Through counseling and personal finance education, credit unions are committed to improving the lives of their members."
 
The LSS "Financial Choice" program offers debt management advice over the phone and in person. Its certified financial and housing counselors specialize in credit card debt, student loan debt and foreclosure prevention.
 
LSS services are currently offered at 15 credit unions throughout the state:
  • Anoka Hennepin CU, Coon Rapids;
  • City & County CU, St. Paul;
  • Cook Area CU, Cook;
  • Embarrass Vermillion FCU, Aurora;
  • Hermantown FCU, Hermantown;
  • Hiway FCU, St. Paul;
  • Mid-Minnesota FCU, Baxter;
  • Northern Communities CU, Duluth;
  • NSP St. Paul CU, St. Paul;
  • Richfield Bloomington CU, Richfield;
  • SouthPoint FCU, Sleepy Eye;
  • TopLine FCU, Maple Grove;
  • TruStar FCU, International Falls;
  • United Educators CU, Apple Valley; and
  • US FCU, Burnsville.

Gladwell At BAI: Innovation Rewards Patience, Not Haste

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DENVER (11/7/13)--
Click to view larger image "The median amount of time required for a product idea to go from conception to widespread adoption is 45 years," said Malcolm Gladwell, staff writer for The New Yorker and author of  "The Tipping Point" and "Blink." He spoke about innovation at the BAI Retail Delivery Conference Wednesday in Denver. (Photo provided by CUNA)
"The key issue with innovation is not haste; it's patience," Malcolm Gladwell told attendees at the BAI's Retail Delivery Conference in Denver on Wednesday. "The innovation race is not to the swift; the innovation race is to the patient," he said.
 
Gladwell is a staff writer for The New Yorker and author of such best-sellers as "The Tipping Point" and "Blink."  He also was a keynoter at the Credit Union National Association's America's Credit Union Conference in June.
 
Gladwell traced the history of the rock band Fleetwood Mac as an example of perseverance and success within a very competitive market. "Few people know that the band struggled through 10 years of trial and error before their album "Rumors" sold 19 million copies and remains the fifth or sixth best-selling album of all time," Gladwell said.
 
"The median amount of time required for a product idea to go from conception to widespread adoption is 45 years," he said. Gladwell believes in the 10,000-hour rule, which he said is like an apprenticeship period where a certain level of mastery is required to be creative and innovative. "The process of producing something significant is a good deal more protracted than we think," he said.
 
He described two types of innovators: conceptual innovators who have an immediate impact with their radical ideas and experimental innovators who move through a much longer period of trial and error. "Conceptual innovators are relatively rare," Gladwell said. "Your financial institution should promote an environment where experimental innovation can take place," he said.

NuVision FCU Receives Congressional Recognition For Biz Leadership

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HUNTINGTON BEACH, Calif. (11/6/13)--
Click to view larger image U.S. Rep. John Campbell, left, awards Huntington Beach, Calif.-based NuVision FCU's CEO, Roger Ballard, special congressional recognition for Outstanding Business Leadership on behalf of more than 87,000 credit union members primarily in Los Angeles and Orange Counties. (Photo provided by NuVision FCU)
NuVision FCU CEO Roger Ballard has been awarded special congressional recognition for Outstanding Business Leadership by U.S. Rep. John Campbell (R-Calif.) during a ceremony at the congressman's offices in Irvine, Calif.
 
"It is an honor to receive this recognition from Congressman Campbell, whose deep knowledge of our industry and tireless work on behalf of the American people is commendable," said Ballard, CEO of the Huntington Beach, Calif.-based, $1.3 billion asset credit union since 2004. "Throughout NuVision's tremendous growth over the past 75-plus years, we have stayed focused on meeting the needs of our members, which I believe is the cornerstone of our success."
 
Campbell is a member of the House Committee on Financial Services and chairs the subcommittee on monetary policy and trade, as well as serves on the House Committee on the Budget.

CU System Briefs (11/06/2013)

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  • BURLINGTON, Vt. (11/6/13)--The Burlington, Vt., Police Department is investigating multiple instances of fraud at an ATM located outside a branch of the New England FCU. On Oct. 29, police received a complaint about two men standing by the ATM, allegedly asking for help from consumers trying to use the machine (The Burlington Free Press Nov. 4). One suspect would approach the victim while the other suspect stood farther away, multiple victims told the police. The suspects would share a story to convince the ATM users they needed cash. Several victims entered their personal identification numbers and allowed the suspects to make deposits and withdrawals. The suspects would place what appeared to be a check into a deposit envelope. However, it was later found the deposit envelopes held deposit slips with fake account numbers ...
  • TAMPA, Fla. (11/6/13)--A man has been charged with robbing a branch of Grow Financial CU, Tampa, Fla.   Hillsbourough County (Fla.) Sheriff's officers arrestedOswaldo Jose Jackman, 42, late Friday (Tampa Bay Times Nov. 3). The Sheriff's Office released a surveillance camera photo of the robber and offered a $1,000 reward for information leading to his arrest. Jackman allegedly handed a note demanding money to a teller. Police did not say how they located him ...
  • MIDDLETOWN, Pa. (11/6/13)--Mid-Atlantic Corporate FCU is adding a button to its website to allow credit unions to donate money to the Children's Miracle Network Hospitals. The website is also featuring a video about Mid-Atlantic Corporate's Children's Miracle Ambassador Sammy Hill, who received care from Penn State Hershey Children's Hospital and CMNH after she was injured by a falling tree branch. Through a telethon, a charity run, and a golf tournament, Mid-Atlantic Corporate staff has raised more than $67,000 for CMNH this year. Since 1996, credit unions have given the childrens' hospitals more than $110 million ...
  • LAUREL, Md. (11/6/13)--Tower FCU sponsored a charity concert to support Maryland Therapeutic Riding, a non-profit organization that uses horses to improve the quality of life of special needs children, adults, wounded veterans and their families. The "Live On The Farm Benefit Concert" was held on Sept. 27 at the charity's 26-acre farm in Crownsville, Md., and featured Grammy Award-winning country music singer Ricky Scaggs and a local act called The Hard Travelers. The event also featured live and silent auctions that raised almost $200,000. "Tower is honored to support MTR," said Carrie Geyer, a representative from the credit union who attended the concert. She noted that MTR's programs "focus on our wounded warrior population as they receive confidence, strength and rehabilitation through therapeutic horseback riding." Tower FCU is based in Laurel, Md., and has over $2.6 billion in assets. In the photo, Maryland Therapeutic Riding Executive Director Col. Kenneth McCreedy (Ret.) accepts a check for $5,000 from Geyer at the concert. (Photo provided by Tower FCU) ...
  • NAPERVILLE, Ill. (11/6/13)--CU America Financial Services Inc. named John Ochodnicky as its new CEO last month after former President/CEO Jerry Haley that he would retire on Oct. 31. Ochodnicky has served as a loan officer and vice president/sales manager for CU America for 14 years, having closed over 1,200 loans for member credit unions. CU America is a credit union service organization jointly owned by six Illinois credit unions. It underwrites, documents and services mortgages for credit unions, and has closed over $1 billion in mortgage loans ...

Ohio League Board Election Results Announced

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COLUMBUS, Ohio (11/6/13)--The Ohio Credit Union League has announced the results of its board elections, with two members elected by acclamation and three elected to positions in their districts (eLumination Newsletter Oct. 30).

Their terms are for three years.
 
Running unopposed and elected by acclamation are: Barry Shaner, CEO of Directions CU, Sylvania, District I,  and Robin Thomas, CEO of Taleris CU, Cleveland, District III.
 
Elections were held for three open seats, which will be held by:
  • Art Kremer, CEO of Sharefax, CU, Batavia, District II;
  • Karen Reams, CEO of Millstream Area CU, Findlay, Membership Category A; and
  • Dan Sutton, chief operating officer of Kemba CU, Cincinnati, Membership Category C.

Mich. House Passes League-backed Bill Vs. Scrap Metal Theft

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LANSING, Mich. (11/6/13)--The Michigan House passed a Michigan Credit Union League-supported two-bill package to combat the theft of scrap metal from foreclosed properties.
 
The legislation would require purchasers to wait three days to pay individuals who sell catalytic converters, copper wire and air conditioners, which are frequently stolen items. HB 4593 also requires additional documentation for scrap metal purchases (Michigan Monitor Nov. 4). 
 
The league has lobbied for the legislation because credit unions have reported recurring instances of metal theft from foreclosed and branch properties in certain areas.
 
Scrap metal loss is a major problem for credit unions because in addition to any costs to repair the damage from the removal of the metal, homeowners must pay to replace the stolen metals to return the property to sellable condition. Meanwhile, the property is still at risk for future theft, the league said.
 
MCUL will continue to monitor the package as it moves through the state Senate. Additional bills may be added to the package in the Senate, the league said.
 
The legislation may become part of an umbrella initiative on blight, which includes stronger regulation of the scrap metal industry to prevent the stripping of metal from residential property, procedures to identify abandoned property and expedite its foreclosure, and possible reforms to the foreclosure process (News Now Feb. 2).

CU League Of Connecticut Names Nowacki New CEO

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MERIDEN, Conn. (11/6/13)--Jill Nowacki is the new president/CEO of the Credit Union League of Connecticut, the league's board of directors announced Tuesday.

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."

Eight CUs Collaborate To Build CU Value Awareness

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ST. PETERSBURG, Fla. (11/6/13)--Eight credit unions from across the nation have joined credit union service organization PSCU in launching a cooperative grassroots effort to educate a new generation of consumers about the wealth of benefits that credit unions provide and big banks don't.

The social campaign, called "Make Your Money Matter," centers on a website, www.makeyourmoneymatter.org, and is aimed at Millennials, young, local-minded consumers born in the 1960s or 1990s.
 
It was launched Monday to tie in with yesterday's Bank Transfer Day, which promoted switching to credit unions from commercial banks.  "Make Your Money Matter" will reach out via Web and social media outlets, encouraging Millennials to make the switch.
 
All financial institutions "have their eyes focused on Millennials and rightfully so," said Andy Dickhut, brand manager for the $487 million, Kansas City, Mo.-based Mazuma CU, one of the eight participating credit unions. "They're going to play a large part in defining how banking is done going forward.  Millennials are passionate about communities, so this is a great joint venture to show them how credit unions share those same values," he said.
 
The campaign features an interactive experience that educates visitors about the differences between big banks and credit unions and highlights how consumers and the local economy can benefit from credit unions. The site features a calculator that compares shareholder profits from consumers' deposits at big banks, and provides forms to make the switch to a credit union. The campaign also empowers local credit unions to spread the message with shareable visual assets that can be seeded across their social channels.
 
Participating with Mazuma  and the St. Petersburg, Fla.-based PSCU, a credit union service organization that provides traditional and online financial services for more than 680 credit unions, are:
  • Redwood CU, Santa Rosa, Calif.;
  • GTE Financial CU, Tampa, Fla.;
  • Baxter CU, Vernon Hills, Ill.;
  • Firstmark CU, San Antonio;
  • Bethpage (N.Y.) FCU;
  • Michigan First CU, Lathrup Village, Mich.; and
  • OnPoint Community CU, Portland, Ore.
This isn't the first time that credit unions have united for good, and it won't be the last.  Even among credit unions competing against each other in the same communities, credit unions have rallied to make consumers and others more aware that credit unions bring value to members and their communities.

Recently, three credit unions from Eugene, Ore., teamed to produce videos that span credit union values, the credit union experience and preserving credit unions' tax status. For more information, use the link.

Lending Council Five Big Ideas To Drive Creativity Results

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PHOENIX (11/6/13)--Creativity is the currency for success in the business world--it's the one thing that can't be outsourced, author and entrepreneur Josh Linkner said during the 19th annual CUNA Lending Council Conference Monday in Phoenix.
 
Click to view larger image No matter how successful your credit union is now, don't think that's a permanent condition, author and entrepreneur Josh Linkner said Monday during CUNA Lending Council's 19th Annual Conference in Phoenix. "Our mission is to be on the forefront and think about what's next, even when we're ahead."
"Credit unions need to double down on creativity," said Linkner, a former jazz musician who draws parallels between that art form and small business start-ups.
 
Like jazz performers, start-up companies often exhibit high energy and creativity, take risks, and explore new ideas instead of rehashing what's already been done, Linkner said. "There's no operations manual we can follow to find success. Raw creativity is driving business forward."
 
Consider the case of DollarShaveClub.com, which took on one-time market leader Gillette by selling low-cost razors online. The owner launched the business about a year ago, spent $4,000 on a creative promotional video that garnered three million viewers--and attracted 17,000 customers in a week.
 
"He was the jazz musician of razor blades," Linkner said. "If that disruption can happen through raw creativity, just think what credit unions could do--and what risks do they face?
 
"The lesson is, no matter how successful we are, don't think it's a permanent condition. Our mission is to be on the forefront and think about what's next, even when we're ahead."
 
Linkner offered five "big ideas" to drive creativity and results:
  1. Encourage courage. Allow staff to be creative without fear of rejection or punishment. "Fear is the biggest blocker of creativity," Linkner said. "If you can make people safe, you will unleash creativity in your organization. You might get some bad ideas, but you'll end up with some good ones. Mistakes aren't fatal; they're the portal to discovery."
  1. Shed the past. You need to hunt down and kill old assumptions, Linkner said. "Get rid of what was in favor of what could be. Think about your own lending: Are you doing the same thing as always or are you looking to the next play?"
  1. Create vivid experiences. This requires more of an investment in imagination than money. "You don't have to be stuffy. If you can tell a story that's different from your competitors', you'll benefit."
  1. Reject bureaucracy and think small. Small companies are more likely to take risks, embrace urgency, and find new ideas instead of protecting old ones. "Think small, like a start-up," Linkner advised. "How would you approach your business if you were a start-up?"
  1. Stand out. Do the opposite of what your competitors are doing. "Sometimes you have to be bold and different to get through the noise."
 
Click to view larger image Before entering into student lending, credit unions must make sure it fits into their business model, said a student lending panel at CUNA Lending Council's conference in Phoenix. From left are: Moderator Paul Gentile, Credit Union National Association executive vice president of strategic communications and engagement; Jon Jeffreys, president of  Credit Union Student Choice; Alice Stevens, chair of Member Student Lending LLC; Mike Long, executive vice president/chief operating officer for CU Campus Resources; Rohit Chopra, student loan ombudsman for the Consumer Financial Protection Bureau; and Tim Segerson, deputy director for NCUA. (Photos provided by CUNA)
Other highlights during the conference, which was attended by 433 credit union lenders, included these takeaways:
  • Before credit unions enter into the student lending business, they must make sure this type of lending fits their business model, said a student lending panel moderated by Paul Gentile, executive vice president of strategic communications and engagement at the Credit Union National Association. The  panel included Alice Stevens, chair of Member Student Lending LLC; Mike Long, executive vice president/chief operating officer for CU Campus Resources; Rohit Chopra, student loan ombudsman for the Consumer Financial Protection Bureau; and Tim Segerson, deputy director for the National Credit Union Administration.
  • Survey results indicate 60% of credit unions have addressed payments issues in their strategic plans, and 75% discuss these issues regularly, said Chris Chippindale, vice president of enterprise initiatives and electronic banking for Ent FCU, based in Colorado Springs, Colo. "That's too low," he said, urging colleagues to find ways to make money from payments.
  • Don't take the indirect lending channel for granted--make those members your own with member onboarding and relationship development calls. That was the word from Springfield, Mass.-based STCU's Renee Taylor, Scott Adkins, and Angila Schafer.

Filene Report On Channel Delivery: Branches Still Important

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MADISON, Wis. (11/6/13)--While credit union members increasingly use digital channels for low-value transactions and finding information, they still prefer to receive financial advice in branches, according to a new report from the Filene Research Institute.
 
Branches must be more efficient, and branch leaders must be free to focus more time on high-value behaviors such as advice, product sales, and resolving complex issues, said the report, "Channel Delivery for Tomorrow," which was co-sponsored by the Pennsylvania Credit Union Association.
 
Despite steady use and preferences for branches, the strongest growth right now is in mobile and online services. That growth, coupled with the cost advantages of distributing information and low-value transactions in digital channels, means credit unions need to seek out and adopt digital channels. Those that do not will not be compelling enough to be the primary institutions for the millennials and digital natives who are now choosing their institutions, the report said.

While credit unions can make gradual changes with current members, it is easier to start migrating new members to preferred channels. The report offers three ways to do that effectively:
  • Offer positive incentives for using the preferred channel (or, sparingly, disincentives for the less preferred). Consumers in one survey would be willing to switch channels for interest rate bumps on loans or deposits.
  • Set positive defaults to encourage preferred channel usage. When members are opening accounts or making changes, set up electronic communications as the default while informing them that they can switch out of the default if they like, the report advised. Most never will. Consider a fee schedule that offers service tiers, with "unlimited, anytime, anywhere" options as the most expensive.
  • Provide a technology concierge to walk members through their first interactions with low-cost channels like mobile and ATM. An initial human demonstration will assuage concerns and prove to most members that electronic channels are often more convenient and faster.
Credit unions must match the right transactions with the right channels to be sustainable, the report said. Good strategy acknowledges trade-offs, and credit unions cannot afford to invest equally in every channel. Most credit unions should focus strategically on digital channels, which will only increase in importance for attracting and retaining members in the next three years.

Savings Study Findings Indicate CUs Could Win Over Young Adults

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WASHINGTON (11/6/13)--Credit unions could make inroads with young adults by offering additional age-specific financial education and savings plans. That is the age group most interested in trying to save, according to a recent survey.
 
The survey--released by America Saves, a non-profit research institution that encourages saving--said that young adults between the ages of 18 and 35 rate themselves as showing the highest amount of interest and putting the most amount of effort into saving money.
 
When asked to rate their own interest and effort on a 10-point scale, 77% of the young adult cohorts reported an interest in saving, while 66% claimed to make an effort to save money.

The survey indicated what appears to be an inverse relationship between age, and both interest and effort in saving, although all age groups reported having a higher interest in saving money than the effort they are currently putting into it.
Among the findings:
  • Respondents ages 35-44 rated their own interest at 73% and effort at 61%;
  • Those ages 45 to 54 rated their interest at 73% and effort at 64%;
  • People between 55 and 64 rated their own interest at 68%  and effort at 61%; and
  • Those ages 65 and older rated their own interest at 56% and effort at 53%.
There also appears to be a direct correlation between income, and respondents' interest and effort effectiveness with regard to saving money.

America Saves said that the "surprising" revelations about age could indicate a generational anxiety about the 2008 financial crisis, the recession that followed and the long-term viability of Social Security.

The organization polled more than 1,000 Americans for the survey.

Orange County Register: CUs Put Members' Interests First

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SANTA ANA, Calif. (11/6/13)--"The Credit Union Advantage," a 12-page supplement to the Oct. 31 issue of the Orange County Register in Santa Ana, Calif., tells readers "how credit unions can build your financial future."
 
The advertising supplement brought visibility to the credit union difference through six articles:
  • "People before profit" tells the many advantages and benefits of credit unions. It highlights independent surveys that say credit unions offer better service and higher member/customer satisfaction and cites statistics from the Credit Union National Association and the California and Nevada Credit Union Leagues.  It discusses key advantages and differences, the cultural shift taking place as credit union membership grows, and the historical roots of credit unions.
  • "Who Can Join?" notes that "getting in the credit union game is easier than you'd think," and offers five questions to ask before joining a credit union.
  • "Crafting a financial plan" discusses why "credit unions are increasingly becoming the financial institutions of choice to plan for retirement."
  • "Bite of reality" discusses financial literacy endeavors of credit unions in the state and their  "Bite of Reality" interactive educational initiative that teaches students about real-world finances.
  • "Giving back" highlights how social responsibility remains at the core of the credit union mission and includes examples from several area credit unions.
  • "Debunking the myths" notes several widely held but false beliefs about credit unions.
  • "Leading Orange County Credit Unions" provides information about Eagle Community CU, Lake Forest; Nuvision FCU, Huntington Beach; Orange County's CU, Santa Ana; SchoolsFirst FCU, Santa Ana; Southland CU, Los Alamitos; and Wescom CU, Pasadena.
To access the supplement, use the link.

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."

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.

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."

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.

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.

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.

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.

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."

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.

Maine League Endorses Michaud For Governor

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WESTBROOK, Maine (11/4/13)--The Maine Credit Union League Thursday endorsed U.S. Rep. Mike Michaud (D-Maine)--a former credit union board member--in his campaign for governor of Maine.
 
The league, which represents 61 credit unions and 633,000 members, announced its endorsement at its headquarters before a crowd of about 100 people that included league board members and staff.
Click to view larger image U.S. Rep. Mike Michaud, left,  (D-Maine) shakes hands with John Murphy, Maine Credit Union League president/CEO, after the league endorsed Michaud's campaign for the governor of Maine. (Photo provided by Maine Credit Union League)
 
"From his time in the state legislature--including serving as Senate President--to his six terms in Congress, Congressman Michaud has been a great friend to Maine's credit unions," John Murphy, league president/CEO.
 
"Having served as a credit union volunteer for several years, he has a unique understanding of our issues and the impact that legislation can have on credit unions and members. He also has a deep appreciation of the positive role that credit unions play in the lives of thousands of Maine consumers and in the communities they serve," he said.
 
A former board member, Michaud, left, is now an honorary credit union board member at Eastmill FCU in East Millinocket, Maine.  In 2002, Michaud was first elected to Congress and was the only credit union board member serving in Congress at the time.
 
"It's our shared commitment to Maine's economy that makes the endorsement of the Maine Credit Union League so important to me," Michaud said. "Maine's credit unions are democracy in action. Locally owned and member-directed, they put the interests of their community first. Our economy relies on small businesses and the middle class. When they grow it helps everyone, and Maine's credit unions are helping them to grow."

CU System Briefs (11/04/2013)

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  • CENTERVILLE, Utah (11/4/13)--A masked robbery suspect took advantage of Halloween by robbing the Centerville, Utah-branch of Ogden-based America First CU Thursday. The incident occurred at about 6:45 p.m. Halloween night. The suspect, wearing a white "Jabbawockeez" mask, gloves and hooded sweatshirt when he entered the credit union, was asked to remove the mask. Instead, he refused and demanded money. No weapons were displayed and no threats were made, said the Centerville Police Department ( Fox13now.com Nov. 1) ...
  • HARRISBURG, Pa. (11/4/13)--Staff, board members and associated business partners of Exton, Pa.-based Citadel FCU gathered for an event honoring U.S. Rep. Jim Gerlach (center) and hosted by the credit union, said the Pennsylvania Credit Union Association (Life is a Highway Nov. 1).  The congressman discussed what the U.S. House Ways and Means Committee is considering with the tax code reform and healthcare reform, and answered questions. Gerlach has served on the committee since 2010 and has been supportive of credit unions since taking office in 2002, said PCUA.  He has been a past co-sponsor of supplemental capital legislation and supports finding solutions to regulatory challenges faced by credit unions. Pictured with Gerlach and the group are Citadel FCU CEO Jeff March (center right) and Christina Mihalik (second from left), PCUA vice president of government affairs.  (Photo provided by the Pennsylvania Credit Union Association) ...
  • BANGOR, Maine (11/4/13)--A woman and two men have been indicted as part of a burglary ring that prosecutors say has hit at least 35 businesses in the Bangor, Maine, area. The thefts include an attempted break-in at an ATM at Lincoln Maine FCU in Lincoln on July 29. The ATM sustained several thousand dollars in damages, the indictments said. Arrested were: Matthew J. Anderson, 24, of Mattawamkeag, charged with aggravated criminal mischief; Jacey Searles, 20, of Kingman, charged with receiving stolen property, aggravated criminal mischief and two counts each of burglary, criminal mischief and theft by unauthorized taking; and Brandon R. Tolman, 24, of Lincoln, charged with burglarizing a motor vehicle, two counts of aggravated criminal mischief, four counts of burglary and five counts of theft. Searles is also charged with driving the getaway car during the credit union incident.  A fourth suspect, Steve Springer, 28, of Mattawamkeag was arrested Oct. 26 and charged in the burglary of a motor vehicle and three other burglaries. The Penobscot County District Attorney said more arrests in the burglary ring are expected (Bangor Daily News Oct. 30) ...
  • SANFORD, Maine (11/4/13)--Philip Gage, 46, of Somersworth, N.H., has been arrested as a suspect in the Oct. 26 armed robbery of the Sanford, Maine branch of Biddeford, Maine-based Ocean Communities FCU. Gage was arrested at his home Thursday morning and is being held in the York County Jail.  He also is charged with robbing the Kennebunk Savings Bank in Eliot, Maine, on Oct. 19. (Bangor Daily News Oct. 31)  ...
  • WASHINGTON (11/4/13)--Callahan & Associates Friday has changed its organizational and leadership structure, with the senior management team operating in a partnership mode and leadership roles significantly redefined. The new approach shifts the firm's emphasis from collecting and presenting information to its application, with staff working more collaboratively and with more external interaction with the marketplace.  Jon Jeffreys, currently vice president of Callahan Financial Services, will become managing partner and work with the team to allocate resources.  Jay Johnson, executive vice president, will lead development of content and assume the role of president of Callahan Financial Services while continuing as president of TRUST mutual funds for credit unions. Alix Patterson, previously the firm's chief operating officer, will lead the firm's solution development and innovation team; and Scott Patterson will be the firm's point person on its Student Choice program and leverage his technology/innovation experience to generate new business solutions. He also will lead the firm's strategic partnerships.  CEO Sean Hession will continue with the firm into 2014 to assist with the leadership transition. Co-founder Chip Filson will continue as board chairman ...

CUNA Site Launches New Press Room

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WASHINGTON and MADISON, Wis. (11/4/13)--The Credit Union National Association's website has launched a new Press Room page, which is now accessible on www.cuna.org., to provide information and resources about CUNA and credit unions in a one-stop shop.
 
The Press Room will house CUNA's press releases and statements, bios and photos of CUNA's executive management team, and press contacts, as well as sections with recent mentions of CUNA and credit unions in the media.
 
"There is also a Press Resources page for reporters to find out information on key issues CUNA is working on, and basic facts and statistics about the credit union industry," said Paul Gentile, executive vice president of strategic communications and engagement.
 
It links to an "About CUNA" page that provides information about the nation's premier trade association for credit unions, including CUNA's committees; board members, districts and elections; executive management team; statement of vision, mission and goals; the Power of Association brochure; the Unite for Good campaign; career opportunities; and its corporate policies.
 
The link also outlines CUNA's partnership with state leagues, provides an events calendar and information about the national Maxwell/Herring/Desjardins Awards Programs, and provides a compendium of CUNA policies on legislative and regulatory issues.
 
It features information about partnerships through CUNA Strategic Services and related organizations as well as financial statements and annual reports.
 
It also tells how to find CUNA's Madison, Wis., and Washington, D.C., offices, and links to News Now's top stories.
 
The page can be accessed by clicking the "Press Room" link at the bottom of CUNA's homepage or by using the link.

CUs Report Strong Loan Growth In September

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MADISON, Wis. (11/4/13)--Loan growth at credit unions in September continued to rise, with the past 12 months' growth pace the fastest since before the Great Recession, according to the Credit Union National Association's Credit Union Monthly Estimates for September, released Friday.
 
Click to view larger image Click for larger view
Loans in September totaled $648.7 billion, up from $607.8 billion in September 2012.
 
"Credit unions reported strong loan growth in September, with balances rising 0.8%, compared to 0.5% in October 2012," said Steve Rick, senior economist at CUNA. "Over the last 12 months, credit union loan balances rose 6.7%, the fastest pace since 2008," he said.
 
Rick noted that "adjustable-rate first mortgage loan balances posted the biggest increase in September, rising 1.4%, and are up 5.3% over the last year.  New- and used-auto loan balances also grew faster than 1% in September and both posted around a 11% growth rate over the last year."
 
What's behind that growth? Rick attributed it to "both supply and demand factors," which "are driving the accelerated pace of lending: credit unions are lowering interest rates and loosening credit standards to increase the supply of loanable funds while stronger consumers' balance sheets are increasing the demand for loanable funds.
 
"Rapidly rising home and stock prices are creating what economists call a strong 'wealth effect,' whereby consumers feel wealthier and therefore borrow and spend more out of current income," Rick added.
 
Click to view larger image Click for larger view
Meanwhile, savings declined 0.6% in September, compared with a 0.8% increase in August, according to the monthly estimates. However, total savings for September was up to $926.3 billion, from $888.3 billion a year earlier.
 
Individual retirement accounts rose 0.5% during September from the previous month, with regular shares increasing 0.1%. Share drafts dropped 4.3%, one-year certificates declined 0.7% and money market accounts declined 0.1%, said the report.
 
Rick also noted that "credit quality is also improving with credit unions reporting a delinquency rate less than 1% in September, down from 1.17% in September 2012.  A 9% fall in the dollar amount of delinquent loans combined with a 6.7% rise in loans outstanding created the significant drop in the delinquency ratio.
 
"The delinquency rate should fall to 0.8% in 2014, back to the level reported before the onset of the Great Recession."
 
The report also noted that the loan-to-savings ratio increased to 70% in September from 69.1% in August, bringing the liquidity ratio (the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities) to 16.9%.
 
Total credit union membership continued climbing, with 0.4% growth in September to 98.7 million members across the U.S. The movement's overall capital-to-asset ratio rose to 10.4%, with total capital at $112 billion.

Top 10 News Now Articles For October

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MADISON, Wis. (11/4/13)--An article about the National Credit Union Administration's approval of a final rule addressing emergency liquidity and contingency funding plans for credit unions was the most-read News Now article in October.
 
Four of the Top 10 stories dealt with the federal government's partial shutdown and how credit unions helped members with assistance programs.
 
The Top 10 articles for the month include:
 
10. Survey Shows New Mortgage Regs Could Force CUs To Reduce Programs

 WASHINGTON (10/21/13)--Some credit unions may be forced to discontinue, delay, or reduce their mortgage loan product offerings due to Consumer Financial Protection Bureau mortgage regulation changes that are set to take effect in January, a Credit Union National Association survey has revealed.
 
9. CUs Offering Help To Furloughed Fed Employees

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.
 
8. Payday Passes, Fed Employees Seek Help From CUs

 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.
 
7. NCUA: No NCUSIF Assessment In 2013

ALEXANDRIA, Va. (10/25/13)--Thursday's National Credit Union Administration open board meeting featured good news for credit unions: There will be no National Credit Union Share Insurance Fund premium assessment in 2013, agency Chief Financial Officer Mary Ann Woodson reported.
 
6. NCUA, CUNA, CUs Prepared For Government Interruption
 
WASHINGTON (10/1/13)--Federal workers walked away from their desks last night not knowing whether the U.S. government would be open for business this morning or not. But either way, the National Credit Union Administration on Monday said it would be open for business, and it encouraged credit unions to "maintain a state of readiness to help their members who may be affected by a potential government shutdown."
 
5. Bills Want To Boost Savings Via Prize-Linked Accounts

 WASHINGTON (10/31/13)--Federal legislation that would allow credit unions and other financial institutions nationwide to offer prize-linked savings accounts was introduced in the U.S. House and Senate this week.
 
4. For CUs: Agencies' Status During Gov't Shut Down

 WASHINGTON (10/2/13)--"While the gridlock in Washington has put many people in an unfortunate situation, it's important for the nation's 98 million credit union members to know that credit unions are still operating safe and sound," Credit Union National Association President/CEO Bill Cheney said following Tuesday's news of the federal government shutdown.
 
3. CUNA Brief: Fed Interchange Rule Bad, Court Ruling Worse

 WASHINGTON (10/21/13)--The Federal Reserve Board has made errors in implementing the Dodd-Frank-imposed debit interchange fee cap, the Credit Union National Association said today in a legal brief, but a July 31 U.S. appeals court ruling  overturning the rule would make things "significantly worse."
 
2. NCUA Unveils Upcoming CU Exam Changes

 ALEXANDRIA, Va. (10/8/13)--Changes that will streamline credit union examination reports and improve the overall exam process by setting clearer expectations for credit unions and examiners will be introduced on Jan. 1, the National Credit Union Administration said in a letter to credit unions (13-CU-09) released this afternoon.

1. CLF And Fed Discount Window Are Only Sources For Emergency Liquidity In New NCUA Rule

 ALEXANDRIA, Va. (10/24/13)--A final rule addressing emergency liquidity and contingency funding plans for credit unions has just been approved at today's National Credit Union Administration open board meeting.

Two More CU Execs Nominated For CUNA Board

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WASHINGTON and MADISON, Wis. (11/4/13)--The Credit Union National Association received two more nominations--numbers five and six--Friday for positions on the CUNA Board of Directors.
 
Eight board positions are open in this year's elections, and CUNA will accept nominations through Nov. 26.
 
Both the new nominees are running for a seat representing District 4, Class A. They are
Pat Drennen, CEO of 1st Gateway CU, Camanache, Iowa, and Geraldine Burek, president/CEO of South Division CU, Evergreen Park, Ill.
 
Other nominees so far 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.; 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.
 
CUNA will announce the results of contested elections 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.

Carolinas Foundation Elects Officers, Caverly Named To Board

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WINSTON-SALEM, N.C. (11/4/13)--The Carolinas Credit Union Foundation board of directors elected officers and welcomed a new member at its annual meeting on Oct. 23, said the North Carolina Credit Union League (Weekly Conversation Nov. 1).
 
Raleigh, N.C.-based Local Government FCU Executive Vice President Mark Caverly was named to the foundation's board as part of a series of decisions that saw all officers re-elected to their positions.
 
Caverly also serves as president of the Tarheel Chapter of the North Carolina Credit Union League, and is a member of the NCCUL Government Affairs Committee. He has also testified about the Credit Card Interchange Fees Act of 2009 before the U.S. House of Representatives' Financial Services Committee, speaking on behalf of the Credit Union National Association and the Electronic Payments Coalition.
 
Brian Sponaugle, chief operating officer for Greenville (S.C.) FCU, was re-elected to a three-year term on the board. He will also chair a newly formed advisory committee made up of credit union business partners advocating on behalf of the foundation.

Judy Tharp, president/CEO of Winston-Salem, N.C.-based Piedmont Advantage CU, will continue to serve as chair of the foundation. Jennifer Parker, senior vice president of Strategic Alliances for Founders FCU, Lancaster, S.C., will continue as vice chair. John Slack, chief sales officer for Palmetto Cooperative Services, will retain his role as secretary/treasurer.

The foundation board of directors also includes:
  • Michelle Bragg, Sharonview FCU, Fort Mill, S.C.;
  • Steve Fowler, South Carolina Credit Union League;
  • Beverly Gagne, SAFE FCU, Sumter, S.C.;
  • Chuck Purvis, Coastal FCU, Raleigh, N.C.;
  • John Radebaugh, president/CEO of NCCUL; and
  • Mark Twisdale, State Employees' CU, Raleigh.

MBLs Among Fastest-growing Loans In Pennsylvania

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HARRISBURG, Pa. (11/4/13)--Member business loans (MBLs) led loan growth at Pennsylvania credit unions in the second quarter of 2013, according to the Pennsylvania Credit Union Profile for Second Quarter 2013.
 
MBLs increased 24.4% in the past year, bettering the national growth rate of 8.2%. For the quarter, MBLs rose 7%, compared with 4% in the first quarter of 2013. Pennsylvania's quarterly statistics also exceeded the national growth rate of 2.5%, said the Pennsylvania Credit Union Association (Life is a Highway Nov. 1).
 
Second quarter lending at credit unions nationwide showed more members were more willing to borrow and less willing to save than a year earlier. Loan balances rose 2.1% in the second quarter, compared with 1.8% for the same period in 2012. Next to MBLs, first mortgage loans grew the fastest at 7%. Used-auto loans were also on the rise at 3.9%.
 
Credit unions have been urging Congress to lift their MBL cap to 27.5% of assets from 12.25% so credit unions can make more business loans.  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.
 
The increase in loan balances combined with the simultaneous drop in the dollar amount of delinquent loans, brought down the national credit union loan delinquency rate (delinquent loans to total loans) to 1.04% in the second quarter of 2013 from 1.21% in the second quarter of 2012.
 
In a report issued this week, the U.S. Small Business Administration (SBA) supported more than $29 billion in lending in fiscal 2013, its third-highest total. The other record highs came in fiscal 2012 ($30.25 billion) and fiscal 2011 ($30.5 billion).
 
The SBA loans were made through two programs, 7(a) and 504. Credit unions may participate in 7(a) loans. The SBA-guaranteed portion of a 7(a) loan is not counted against a credit union's MBL cap, said the article. Roughly, 347 credit unions had more than 8,100 SBA loans outstanding, totaling $921 million in funds, at the end of 2012.

Kenyan CU Savings Is One-third Of National Savings

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MADISON, Wis. (11/4/13)--Kenyan credit unions have mobilized a record $5.7 billion in savings--which represents 33% of the national savings--while providing much-needed access to financial services to unbanked populations, especially women, according to Dr. Wilson Songa, Kenya's Industrialization and Enterprise Development principal secretary.
 
Kenyan credit unions, known as savings and credit cooperatives (SACCOs), play "a key role in creating vibrancy and competitiveness in the financial sector," Songa said at a recent Kenyan Teachers SACCO Association annual general meeting.
 
Most of the 13 million Kenyan SACCO members are savers with modest incomes, according the World Council of Credit Unions. SACCOs help increase their stability and wealth through savings.
 
SACCOs also provide low-interest capital resources that are critical to economic growth. Kenyans, who would have been denied access to loans by most banks due to lack of collateral, have access to low-interest loans through SACCOs. As a result, SACCOs help ordinary Kenyans transform their lives, said World Council.
 
By introducing financial services to women and other unbanked populations, who have been traditionally excluded from the formal financial sector, SACCOs give more Kenyans the ability to generate wealth and invest in their families. When empowered to make financial decisions, research shows that women are much more likely than men to make investments that benefit their entire family.
 
Women with access to formal savings accounts will save more and increase business investments by 40% in four to six months, according to Goldman Sachs Global Investment Research. With greater financial autonomy, women also invest more in education, access to medical care and better-quality food for their families. These types of choices, made possible by financial access through Kenyan SACCOs, are good for economic growth and transformative for individual families.
 
Kenyan SACCOs have the highest growth rates in Africa and rank seventh worldwide, said World Council. Songa stressed that the Kenyan government is committed to continuing to support the SACCO subsector, which creates employment and provides economic empowerment to Kenyans.

GlobeSt.com: Seven Reasons To Get CRE Loan From CU

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WASHINGTON (11/4/13)--A NASA FCU executive predicted that the institution's commercial real estate (CRE) loan portfolio will grow between 30% and 35% this year. And he gave seven reasons why people should get their CREs from a credit union.

Andy Stafford, the Bowie, Md.-based credit union's director of commercial real estate, made the prediction in the publication GlobeSt.com (Nov. 1).

Stafford laid out seven reasons why he thinks NASA FCU is seeing a steady increase in its CRE portfolio--in 2011 and 2012, it grew by 16% and 23% respectively.

He told the publication the credit union offers simple service, with one point of contact for borrowers. It also offers competitive rates and doesn't charge prepayment penalties for refinancing.

NASA FCU has deep community ties and obligations that allow it to avoid defaults by leveraging knowledge and by catering to businesses' needs, he said.
 
Stafford added that NASA FCU is straightforward about its credit products, allowing it to close loans in under two months, and said that because credit unions are accountable to members instead of shareholders, the institutions are more attractive to consumers.
 
For the full article, use the link

Armed Suspect Killed By Police After Robbery

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ERIE, Pa. (11/4/13)--Police officers in Erie, Pa., fatally shot a man suspected of committing the armed robbery of a credit union on Wednesday afternoon.

Law enforcement officials said that Dionne Jordan, 30, was shot repeatedly after he got out of his vehicle and, allegedly, pointed a gun at four city police officers who had tracked him in the wake of the robbery (Erie Times-News Oct. 31).

The officers found Jordan in a wooded area, allegedly attempting to make a getaway 15 minutes after the nearby Widget Financial FCU branch was robbed.

Jordan was pronounced dead at the scene, and was identified afterward by Erie County Coroner Lyell Cook.

Erie Police Chief Randy Bowers said that Jordan repeatedly threatened to shoot Widget employees as he stole money from multiple sources inside the credit union (McClatchy-Tribune Regional News Oct. 31).

The Federal Bureau of Investigation is investigating the robbery because Widget is federally insured. The Erie Bureau of Police Office Professional Standards is also looking into the incident (Associated Press Nov. 1).

Widget Financial FCU, based in Erie, has $261.2 million in assets.
 

CU Goes Above, Beyond To Assist Member In Need

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FREMONT, Mich. (11/1/13)--Volunteers from Gerber FCU stepped up to assist a member whose only source of income is his Social Security disability check. And--as is often the case with credit unions--staff went above and beyond normal service expectations to help.
 
Volunteers from Fremont, Mich.-based Gerber FCU helped dismantle an old deck and build a new entry deck for the home of a member in need. The credit union helped him get into a program that enabled Gerber to modify his mortgage to help meet living expenses. (Photo provided by the Michigan Credit Union League)
The member, Robert Cooley, worked with one of the Fremont, Mich.-based credit union's certified credit union financial counselors, Char Morris, to obtain a grant from the Step Forward Michigan program administered by the Michigan State Housing Development Authority (MSHDA), according to the Michigan Credit Union League (Michigan Monitor Oct. 28).
 
Morris assisted Cooley with the application process and was his main liaison with MSHDA. When she began working with him, his mortgage payment consumed all but $30 of his benefit check.
 
He does not have a phone in his home or reliable transportation, said the league, so Morris made numerous trips to Cooley's home to deliver documents, gather information and obtain signatures during the application process. Her concern about the safety of the home's entrance grew with each visit, and she spent hours trying to find an agency with funding for a project to help. 
 
Holton United Methodist Church and the United Way of the Lakeshore each promised funding. Morris' search for volunteers led to Chuck Whitman, a member of the Fremont Rotary Club, who builds ramps as a volunteer. Other volunteers from the credit union also steeped up.
 
Cooley was approved for a $30,000 grant, which allowed Gerber FCU to modify his mortgage and bring his payment down to less than 45% of his income.
 
The group of volunteers rebuilt his main entry deck and repaired a second set of steps to create a temporary safe egress in and out of the home during the construction project.
 
One group of volunteers, including Gerber President/CEO John Buckley, demolished the deck in an hour. A second set of volunteers constructed the new deck two days later.
 
"We were able to assist a member in need, and our volunteers feel honored to be part of the project that truly improved the well-being of our member," Buckley said.
 
"It is hard to find the words to say how grateful I am to the agencies who put up the money and how surprised I am that so many people cared enough to come together to help," Cooley said.  "Thank you so much Gerber FCU, Holton United Methodist Church, United Way of the Lakeshore and Fremont Rotary."
 
Fostering service excellence is one of the tenets of the Credit Union National Association's and state leagues' Unite for Good campaign. In that campaign, credit unions increase awareness of their value to the community and their members, foster service excellence, and remove barriers to their strategic vision of Americans choosing credit unions as their best financial partner. For more, use the link.

CUs, FIs In Idaho Team Up For Unbanked

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BOISE, Idaho (11/1/13)--Two credit unions are among the Idaho financial institutions that are helping the state's unbanked population rejoin the financial services mainstream.
 
The Bank On program, which launched in August in partnership with the United Way of the Treasure Valley and Idaho Department of Finance, will offer a checking account to people who take five financial literacy classes at any of the 10 financial institutions participating in the program (Idaho Business Review Oct. 21) .
 
Icon CU, Boise, and Simplot Employees CU, Caldwell, are participating in the Bank On program.
 
"We have a strong relationship with the United Way," Connie Miller, Icon CU president/CEO, told News Now. "They approached us and asked us if we wanted to participate. Because education is such a key component of what we do, we were all over it."
 
Members and customers with unpaid fees or negative balances are often referred to ChexSystems, a consumer-reporting agency similar to a credit reporting agencies. ChexSystems notifies financial institutions when an account-holder has a history of account mishandling.
 
Once a person is flagged by ChexSystems, opening a checking account can be a challenge, Miller said.
 
Icon CU already has programs in place to offer second-chance opportunities for members who had problems with loans and checking accounts in the past, Miller said.
 
"That philosophy is part of who we are," she added.
 
The Bank On program won't remove people's names from ChexSystems, but it will give them access to a checking account at any of the credit unions or banks participating in the program.
 
Bank On offers five classes designed by the Federal Deposit Insurance Corp. that can be taken in-person or online. Class topics include using a checking account responsibly, preparing a personal budget and saving money for long-term goals. The ten financial institutions supplied funding for the program as well as staff who will volunteer to teach classes.
 
More than 60 other Bank On projects are working in the U.S.
 
Icon CU is advertising the program in its branches and financial classes, and at events for Big Brothers/Big Sisters, which it sponsors. One of the biggest challenges will be promoting the program, but Icon CU is in it for the long haul, Miller said.
 
"When we look at the various social challenges that we have in our culture, almost all of them have this financial component," Miller said. "If we can tackle the financial side, how many other issues will it help alleviate in our society?"

CU's Purchase Of Bank OK'd By Maryland Regulator

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BALTIMORE, Md. (11/1/13)--The purchase and assumption of a bank by Municipal Employees CU of Baltimore--which would be the first of its kind in Maryland--has been approved by Maryland Commissioner of Financial Regulation Mark Kaufman.
 
Kaufman announced Thursday his approval of MECU's purchase and assumption of the assets and liabilities of Advance Bank, a federally chartered mutual savings bank located in Baltimore. The move is still subject to approval by the bank's depositors at a meeting on Nov. 15, said the Baltimore Business Journal (Oct. 31).
 
Kaufman's office said the proposed transaction is expected to be completed by the end of 2013, subject to any remaining regulatory approvals. The deal's financial terms were not disclosed.
 
The bank has two branches and total assets of about $54 million. MECU is the third largest credit union in the Baltimore area, with $1.2 billion in assets and nine branches, said the Journal.
 
In February the bank reached an agreement with the Office of the Comptroller of the Currency to develop a three-year business plan, review loans for possible credit risk and improve its lending procedures.  MECU told the Journal the agreement would not impact the merger plan. When the deal was announced, Advance Bank CEO John Hamilton said the bank's customers would benefit by having access to a wider array of services, including smartphone banking and auto loans.
 
MECU will convert Advance Bank's two branches to MECU branches and keep the bank's 20 employees, the credit union told the Journal.
 
Maryland's Office of the Commissioner of Financial Regulation oversees state-chartered financial institutions, including credit unions and banks.

Mellin Op-ed: Taxing CUs a Problem For Everyone

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ALBANY, N.Y. (11/1/13)--Credit unions use their tax status to benefit all Americans, and changing that status would have devastating effects on many of the nation's 96 million credit union members, William Mellin, president/CEO of the Credit Union Association of New York,  wrote in an opinion-editorial piece that appeared in Thursday's Buffalo News.

"In fact, for every $1 of income tax on a credit union, each member would lose about $10 in financial benefits," Mellin wrote in the editorial, "Another Voice: Taxing credit unions is a problem for everyone."

"That's $6 billion to $10 billion taken out of the U.S. economy every year--an amount that far outweighs the estimated $500 million to $800 million that would be collected annually by taxing credit unions," he added. "Further, New York credit unions already pay hundreds of millions of dollars a year in a variety of taxes, from payroll taxes to school and property taxes."

Credit unions are exempt from federal corporate income taxes because they are member-owned, democratically operated, not-for-profit cooperatives managed by volunteer boards, Mellin explained. "The value and service credit unions provide to their members and their local communities is why, through good times and bad, Congress has always reaffirmed their federal tax exemption," Mellin wrote.
 
Credit unions provide economic benefits and much-need member services that would be lost if the tax status changed, he added.
 
To read the editorial, use the link.

TMG's Manus: Financial Literacy Still a Challenge For Consumers

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DES MOINES, Iowa (11/1/13)--While an economic recovery is underway, financial literacy remains a challenge for consumers, Shazia Manus, CEO of The Members Group, told The Des Moines Register in an interview published Oct. 25.
 
Manus, who previously served as CEO of Greater Iowa CU, Ames, Iowa, before taking over the leadership of TMG in 2011, said among her most difficult decisions was declining loans to members who were overextended financially and in need of assistance.
 
Consumers must learn to balance needs versus wants, she said.
 
Regulators and business must also understand the importance of balance, she said. Coming out of the financial crisis regulators must understand the necessity of balancing the need for proactive oversight with a view toward unintended consequences, Manus told the Register. Business holders must weigh the desires of stakeholders with the needs of the constituents they serve.
 
Manus said she did not the view the economic downturn as only a crisis, but also as an opportunity to provide leadership.
 
During that downturn, she learned the credit union "people-helping-people" philosophy can make a difference in assisting people who are faced with challenges. At Greater Iowa, she made a difference by fostering the credit union's role as a financial educator.
 
At TMG, the company took the time to listen the challenges facing credit unions and helped its clients fight through a time when consumers were spending less.
 
Change is constant, Manus said. By making hard decisions, and opening members' eyes to the reality of their financial decisions, credit unions are positioning themselves--and their members--for a sustainable future.

Fourth Nominee Received For CUNA Board Elections

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A fourth nomination has been received by the Credit Union National Association for the CUNA Board of Directors elections, which has eight board positions open.
 
Nominations will be accepted through Nov. 26.
 
The latest nominee is Rick Pillow, president of the Virginia Credit Union League in Lynchburg, for the District 2, Class D position on the board.
 
Other nominees so far 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.; 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, and the nomination must be 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.  CUNA will announce the results of contested elections 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.

Lakota FCU Passes 1,000 Member Mark

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KYLE, S.D. (11/1/13)--International Credit Union Day had special significance for the Pine Ridge Lakota Reservation this year. On Oct. 17, Lakota FCU, the only federally insured financial institution serving a reservation that spans wide swaths of South Dakota and a corner of Nebraska, announced that it surpassed the 1,000 member mark.

Since it opened its doors last November, three months after receiving its charter from the National Credit Union Administration, Lakota FCU has accumulated 1,008 members, offering vital services to one of the most impoverished regions in the country.

It has dispensed more than $480,000 in loans, offering lines of credit to residents who had previously been preyed upon by payday lenders, check-cashers and title loan lenders. The credit union has also launched education programs designed to get children on the reservation--some 35% of its population--to avoid exploitative financial institutions and services that have kept their forefathers ensnared in destitution.
 
Lynn Dubray, a Pine Ridge resident from Kyle, S.D. and Lakota FCU member since November 2012, said that prior to the credit union's opening, she had to drive for an hour on rarely maintained roads to access a financial institution. Lakota FCU is located less than a mile from where she works, and since becoming a member, Dubray said she has received a car loan from the cooperative, and has opened savings accounts for her seven children and grandchildren (Indian Country Today Media Network Oct. 16).
 
Lakota Funds, a non-profit that helped Lakota FCU get on its feet, is also working with the credit union to promote youth financial education by matching the savings of 25 grade school students in the Child Development Account Program.

"These kids are going to grow up knowing how to use financial tools and are going to be comfortable walking into any financial establishment as they mature," Tawney Brunsch, Lakota Funds executive director, and Lakota FCU board chair, told ICTMN. "This is an opportunity that the adult generation here on the reservation was never given--until recently."

The opportunity appears to have been sorely needed. Lakota FCU's membership represents about 2.5% of the entire Pine Ridge population. When Lakota opened its doors a year ago, Credit Union Association of the Dakotas said that a traditional "for-profit" bank wasn't really an option for the 40,000 people of the two-million-acre reservation. The unemployment rate on Pine Ridge has recently been higher than 80% (News Now Nov. 27, 2012).

Community leaders had worked to open Lakota FCU since January 2009. It has received three start-up grants from the U.S. Treasury Department's Native American Community Development Financial Institution Assistance Program. As a designated low-income credit union, it can accept deposits from anyone, whether or not they fall within its field of membership--those who live, work, worship, volunteer, study, or conduct business on Pine Ridge or whether or not they're Oglala Lakota Oyate--the part of the Sioux Nation, for whom the reservation was initially designated.

CU System Briefs(3)

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  • GAINESVILLE, Fla. (11/1/13)--A Gainesville, Fla., man was arrested Monday and indicted on three felony charges of fraud, grand theft and money laundering, for an alleged global scheme that involved local credit unions (The Gainesville Sun Oct. 29). Alachua County Sheriff officials accuse Elijah Lashawn Brown, 22, of opening a Sunstate FCU account on Oct. 16, and using it to help a man who called himself Ben Shao launder money from Hong Kong. Brown allegedly told investigators the account was set up so Shao could pay him to help intermittently launder $25 million. The Gainesville resident is also accused of opening accounts at Bank of America and Vystar CU for the scheme. He allegedly gave Shao personal banking information for the Sunstate FCU account after initial attempts to transfer money failed. Shao then, allegedly, sent about $5,000 daily to the Sunstate account. Brown is accused of sending the money via Western Union to accounts in Paris and Nigeria. He allegedly accumulated $14,844 in his Sunstate FCU account. Vystar CU has $4.9 billion in assets and is based in Jacksonville, Fla. Sunstate FCU has $298 million in assets and is based in Gainesville, Fla. ...
  • MIDDLETOWN, Pa. (11/1/13)--Mid-Atlantic Corporate FCU donated 5,101 pounds of food and water to the Central Pennsylvania Food Bank in conjunction with the charity's food drive effort. "This number more than doubled the 2,500-pound goal the corporate set out to achieve," said Janice Appleby, senior vice president, human resources. "In addition, 13 Mid-Atlantic Corporate employees volunteered their time at the food bank." The gift provided the equivalent of 4,250 individual meals across central Pennsylvania. Mid-Atlantic Corporate FCU, based in Middletown, Pa., serves more than 800 credit unions. The Central Pennsylvania Food Bank distributes more than 20 million pounds of food products to more than 600 soup kitchens, shelters and food pantries in 27 central Pennsylvania counties. (Photo provided by Mid-Atlantic Corporate FCU) ...
  • LOS ANGELES, Calif. (11/1/13)--Charles Bumbarger, president/CEO of University CU, is planning to retire at the end of 2013 after leading the credit union for 37 years. When Bumbarger started, University CU had $8 million in assets and seven employees. It now has $482 million assets, 33,000 members, and 95 employees, both full-time and part-time. University CU serves employees and students at the University of California, Los Angeles. The credit union's board of directors has formed a search committee to find a successor ...

ITCU Combines Fin. Literacy With Basketball

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PLANO, Texas (11/1/13)--A credit union in suburban Dallas is planning on taking a few "bank shots" this basketball season, all in the name of financial literacy.

The Plano, Texas-based InTouch CU will partner with the Texas Legends--an NBA Development League team and affiliate of the Dallas Mavericks--for a season-long program combining youth financial literacy with basketball.

The 2013-2014 "Bank to Achieve" program includes five events on Saturday mornings throughout the Legends' current campaign, with the first on Nov. 9 and the last on March 29. The public will meet players, avail themselves of complimentary refreshments, receive free tickets to Legends games and financial workbooks for children and teens, and enter contests for other prizes.
 
"InTouch CU works tirelessly to promote the necessity of financial literacy, not only for children, but for our entire community," said Diane Gerstner, ITCU executive vice president. "We are excited to see how interest has grown for this program over the last few years, drawing families from all other North Texas with some attending all of the events."

ITCU is an official sponsor of the Texas Legends, and this basketball season marks the fourth consecutive year that the two have partnered to organize "Bank to Achieve."

It's likely that some Legends players will go on to become household names, with 30% of all NBA players currently having some experience playing in the NBA Development League, said the credit union.