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CU to IPost CrescentI No hidden card fees here

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APPLETON, Wis. (12/30/09)--Prospera CU, based in Appleton, Wis., has told a local newspaper that new credit card rules won’t impact its members that much. And the credit union won’t be charging hidden fees or penalty pricing. The Appleton, Wis.-based, $148 million asset credit union was among financial experts i expressing optimism that consumers will become better money managers as a result of the new Credit Card Accessibility, Responsibility and Disclosure (CARD) Act, said the Post Crescent (Dec. 29). Mary Lornson, vice president of operations at Prospera CU, said members won’t see much impact in their cards at the credit union because Prospera already had been underwriting its cards in the best interest for members. With no fees or penalty pricing, the biggest change for members will be an increase in disclosures and changes to the statements they receive from the credit union. The credit union will have to retool its system to add more detailed billing, said Lornson. Billing statements arriving in late February or March will be longer and contain more detail, including how long it would take to pay off the balance with only minimum payments. The new rules aim to keep consumers from overextending themselves, Lornson told the newspaper, adding that consumers have more financial education tools available now. She later noted that Prospera has always advocated sound personal financial management. However, she predicted it would take time for the industry to absorb all the rule changes. The Credit CARD Act makes it more difficult to raise interest rates without cause or impose excessive fees on cardholders. Because many of the provisions won’t be effective until February, a number of banks, including Citigroup, Chase and Bank of America, have been raising rates and increasing fees to cover costs from delinquencies, the article said.

ICUL hosts BarCampBank unconference

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NAPERVILLE, Ill. (12/30/09)--More than 20 individuals from credit unions, leagues and the Credit Union National Association (CUNA), plus vendors and a community banker, met earlier this month for BarCampBank, an ad hoc gathering in Chicago to talk about innovations in financial services. The Illinois Credit Union League hosted the event, which was born from a larger BarCamp concept--sharing and learning in an open environment through discussions, presentations and interaction by all participants. All attendees must present a session or lead a discussion or participate in other ways. Participants start with a blank slate and make up the agenda and schedule their presentation at the beginning of the meeting. BarCampBank aims to foster innovations and create new business models in the world of banking and finance. Topics included Introduction to Social Media, Attracting Gen Y, The Next Financial Technologies and Challenges for 2010. Carla Day, one of the event’s organizers said the group is planning another BarCampBank event in the Midwest next spring. Participants are keeping in touch via an e-mail group and social media vehicles such as Twitter (#BCBChi) and the CU Chat Up website community (http://cuchatup.ning.com/). The first BarCamp was held in Palo Alto, Calif., in August 2005. Since then, BarCamps have been held in more than 350 cities worldwide and focused on many topics and industries. The first BarCampBank event was in Seattle in 2007. Other BarCampBank events have been held in San Francisco and Canada.

CUNA open on Thursday closed Friday

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WASHINGTON and MADISON, Wis. (12/30/09)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be open Thursday, New Year’s Eve, and closed Friday, New Year’s Day, for the holiday. News Now will publish a Thursday edition, but not on Friday. It will resume its regular production on Monday, Jan. 4.

CUs mortgage promo cuts sales commissions

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DAYTON, Ohio (12/30/09)--An Ohio credit union program that cuts sales commissions for home buyers and sellers has become more popular this year, according to an Ohio newspaper. The Dayton Daily News reported that the program--by Wright-Patt CU in Fairborn--requires agents to return 20% of their commission to the client. Homebuyers can use the money for down payments, furniture or closing costs, and has brought savings to members who otherwise may have not been able to buy a home, the article said (Dec 26). Real estate commissions range from 6% to 7%. For a $100,000 home, the savings could mean an extra $600 or $700, the newspaper said. Agents have returned $100,000 in commissions, and the cutbacks are expected to reach $112,000 by year-end. Last year, they gave back $87,000. In 2007, they returned $70,000. Ohio credit unions have seen demand for home loans increase. First-mortgage originations during the first half of 2009 reached $960.5 million, compared with $639.5 million the year before, the newspaper added.

ICNNI tells why CUs are better

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WASHINGTON (12/30/09)--CNN Tuesday explained some of the reasons why consumers feel as though they’re “getting a better shake” by choosing credit unions over banks. “Had it with your bank this year? It’s time to start fresh,” said CNN, in a recent story, “Credit Unions Duke it Out With Banks.” CNN carried both a print and video version of the story. Gerri Willis, CNN personal finance editor and host of “Your Bottom Line,” a show dedicated to saving money, noted that fees are lower at credit unions and rates are more attractive. Savings rates at credit unions are 0.41%, compared with 0.29% at banks. A one-year share certificate at credit unions yields 1.45% in interest, while a certificate of deposit at a bank yields about 1.15%. Credit union credit cards are also a bargain, she said. “You might as well go with people who are willing to pay you,” Willis added. She noted a Pew Charitable Trusts study that indicated that interest rates on credit cards from credit unions are 20% lower than those at banks. Credit unions’ penalty annual percentage rate is 18% on average compared with 29% at banks. “People feel like they’re getting a better shake at credit unions, because credit unions serve their members,” Willis said. She suggested viewers visit the Credit Union National Association’s CU Locator to find a credit union. To view the video and print versions of the story, use the links.

A first ASI to assess a premium

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DUBLIN, Ohio (12/30/09)--For the first time, private share insurer American Share Insurance Corp. will charge its client credit unions a special premium assessment of 15 basis points, citing some losses at a few member credit unions. “ASI has never before had to charge a premium or special assessment of this nature, but this past year has been difficult for all financial services providers, including ASI and its member credit unions,” said ASI CEO Dennis Adams. The premium affects all credit unions that have primary share insurance with ASI. ASI primary insurance covers each member’s account up to $250,000. The premium is deemed necessary because of losses developing, or incurred, in a small number of primary insured member credit unions, ASI said in a statement. “We regret assessing such a charge at this time, but additions to our reserve for losses late in the year have forced us to assess the premium to restore the ASI guarantee fund’s equity ratio to above our minimum level of 1.30%,” Adams said. “Record low interest rates and significant guaranty loss provision expense this year have adversely affected ASI’s current earnings, causing our year-end 2009 equity ratio to fall below 1.30% for the first time in over 20 years,” he added. ASI serves roughly 157 credit unions in Ohio, Indiana, Illinois, Idaho, Nevada, California, Texas, Alabama and Maryland. ASI is headquartered in Dublin, Ohio. The National Credit Union Administration this year approved a premium assessment of 0.15% for insured shares on federally insured credit unions to boost the National Credit Union Share Insurance Fund. The Federal Deposit Insurance Corp. also is requiring its institutions to prepay their premium assessments to boost the Deposit Insurance Fund.

Youth marketing is focus of CUNA Council white paper

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MADISON, Wis. (12/30/09)--Youth marketing and communications are the focus of a new CUNA Council white paper. The paper, “Youth Marketing: Strategies and Tactics for Attracting and Retaining Young Members,” is the latest white paper from the CUNA Marketing and Business Development Council. The paper discusses youth marketing, communications planning and strategies, tools and tactics, communications with young people and ways to measure success. It includes 10 case studies of credit unions that are successfully attracting and retaining young members. “We have to attract young members before they reach borrowing age, so when they do reach it, they’ll think of us,” said Lauren Mayhew, marketing director at Daviess County Teachers FCU in Owensboro, Ky., in the paper. Sean McDonald, vice chair of the council and director of business development at Liberty Savings FCU in Jersey City, N.J., added: “It’s important for youth that we get to them at a young age so they can understand the importance of saving and managing their money.”

CU System briefs (12/29/2009)

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* EUGENE, Ore. (12/30/09)--Oregon Community CU, based in Eugene, Ore., has funded $120,000 again this year for 15 student scholarships to the University of Oregon. Each scholarship is worth $4,800 a year. The program has served 100 students for more than 10 years for a total of $1 million. The credit union said it recognizes that more students must both work and take out large loans while attending college full time. Its scholarship program provides financial support for state students with demonstrated financial need who achieve academic excellence and contribute to their community … * NEWARK, Ohio (12/30/09)--As part of a promotion from October to December 2008, Fiberglas FCU, promised members that anyone having a loan at the credit union at the end of the year would be automatically entered into a drawing. The prize: The credit union would make the member’s loan payment for an entire year. Doug Ames, a long-time member and employee of Owens Corning, shown here was the prize winner. The credit union paid his home equity loan payment for him throughout 2009. (Photo provided by Fiberglas FCU) ... * INDIANAPOLIS (12/30/09)--Financial Center FCU has named J. Kevin Ryan as president/CEO, effective Dec. 31. With more than 28 years experience in financial services, Ryan has been involved in the credit union movement for the past 23 years, with experience in finance, budgeting, investments, regulatory compliance, business development and marketing. He has been a board member at the Indianapolis-based credit union and its credit union service organization for the past three years. Ryan has held past executive positions at the Indiana Corporate FCU, Indiana Credit Union League, and CUNA Mutual Group, and earned the Certified Credit Union Executive and Certified League Executive designations from the Credit Union National Association ... * EL PASO, Texas (12/30/09)--Kenneth Walters has been appointed at president/CEO of the El Paso (Texas) Employees FCU, announced the $263.5 million asset credit union’s board of directors. He previously was president/CEO at Chino FCU, Silver City, N.M. Walters joined the El Paso credit union in February 2007 as executive vice president. He said he plans to be actively involved in the credit union movement and is committed to providing outstanding member service while maintaining a strong financial position fofor the credit union. (Photo provided by El Paso Employees FCU) ...