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Puerto Rico lawmaker to probe co-ops regulator

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SAN JUAN, Puerto Rico (12/10/10)--Circumstances around the resignation of the president of the regulatory and supervisory agency of Puerto Rico's cooperatives have prompted a resolution from a lawmaker there to investigate the agency's operations, according to local papers. New Progessive Party Sen. and Chairwoman of the Public Corporations Committee Lornna Soto Villanueva submitted a resolution to investigate internal operations and the reasons for the abrupt resignation of Jose Gonzalez Torres as president of the Public Corporation for the Supervision and Insurance of Puerto Rican Cooperatives (COSSEC) (The Daily Sun (Dec. 8). COSSEC's mission is to guarantee the continuity and permanence of the cooperatives in that country, via regulatory and supervisory duties and to protect members and depositors through effective use of human and technical resources, said the Sun. Gonzalez Torres said he was asked to step down by COSSEC's board because he no longer had board members' trust. Sen. Soto Villanueva said the resignation appears to be related to a proposal for a $200 million loan to Integra Coop to buy toxic loans from local cooperatives. She said no entity, internal or external, can manipulate the stocks and/or operations of workers.

NCUF approves 15 fin ed grants for 2011

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MADISON, Wis. (12/10/10)--The National Credit Union Foundation's (NCUF) board has approved 15 grants for 2011, totaling $294,510. All the grant projects have a financial education component. "At the foundation strategic planning meeting a few months ago, we decided to make financial education a priority in 2011," said Bucky Sebastian, NCUF executive director. "Financial education has long been a part of the foundation's and REAL Solutions' mission. It's also vital to the success of credit unions and consumers nationwide." The projects range from youth financial education in and outside of school to different types of financial counseling and coaching. They include:
* Mid-America Credit Union Association, Bismarck, N.D. , which will provide financial education to participants in the Women, Infants and Children Nutrition Program on the dangers of payday lenders. This will also provide safe credit union alternatives to payday lending and increase awareness of credit unions in the Dakotas. * Metro CU, Chelsea, Mass., which will develop and implement one-on-one financial coaching by corporate volunteers who will assist low income households to identify and follow a path to financial stability and mobility. * Texas Credit Union League, Farmers Branch, Texas, which will implement statewide financial Reality Fairs using social media to enhance student participation, deliver financial education and track the impact social media has on financial literacy of young people. The fairs will increase knowledge and awareness of credit unions, financial tools, credit knowledge and credit union accounts for students 13-18 years of age. * Credit Union Foundation of Maryland and D.C., Glenelg, Md., which will expand “The Millionaires Club,” a high school level, self-sustaining, financial literacy club after school in four pilot expansion locations. The club’s goal is to improve personal financial skills among high school students by providing basic financial education they can place into practice both immediately and during their financial maturation processes.
The other credit union organizations receiving grants include:
* Alternatives CU, Ithaca, N.Y.; * Filene Research Institute, Madison, Wis.; * Hill District CU, Pittsburgh, Pa.; * Iowa Credit Union Foundation, Des Moines, Iowa; * Millstream Area CU, Findlay, Ohio; * Montana Credit Unions for Community Development, Helena, Mont.; * National Federation of Community Development Credit Unions, New York, N.Y.; * New York Credit Union Foundation, Albany, N.Y.; * New York University CU, New York, N.Y.; * Texas Credit Union Foundation, Farmers Branch, Texas; and * University of Virginia CU, Charlottesville, Va.
NCUF grants are made possible by supporters of the foundation and the Community Investment Fund. A full list of grants and the projects is accessible by using the link.

Suspect in drive-thru shooting dies

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MONONA, Wis. (12/10/10)--A man was shot and killed by police at a Monona, Wis., credit union's drive-thru, after he allegedly took a member hostage Wednesday and tried to withdraw funds from the member's account, announced police Thursday. Daniel L. Thomas, 30, allegedly invaded the 63-year-old hostage's home and drove him to the Monona branch of UW CU, where they entered the drive-thru lane in the hostage's sports utility vehicle (Wisconsin State Journal and madison.com Dec. 9). As Thomas attempted to withdraw cash, a teller, who recognized the member in the passenger seat, mouthed to him, "Are you OK?" "She was able to determine by the look on his face that he was not OK," said Monona Police Chief Walter Ostrenga at a press conference. The teller called the police. Police arrived and blocked the vehicle in the lane. Thomas rammed a police car, and several gunshots were exchanged. One television station reported there were five bullet holes in the SUV's windshield (WISC-TV Dec. 9). Ostrenga cited several people as heroes: the teller for her quick action, the victim for his bravery, and two Monona officers for devising a quick plan to block the SUV in the lane to prevent it from getting into traffic. No one else was hurt in the incident, which happened at about 1:45 p.m. Wednesday.

Southeast Corp. announces new biz capital plan

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TALLAHASSEE, Fla. (12/10/10)--The board of directors of Southeast Corporate FCU has approved a new business plan for serving its membership of about 400 credit unions. The plan includes a recapitalization effort focused on continuity of services, preservation and protection of member capital, long-term sustainable value to members, and compliance with the new National Credit Union Administration Part 704 requirements for corporates as they take effect the next few years. “We have begun holding webinars with our members this month and will schedule town hall meetings in early 2011,” said Brad Miller, president/CEO of Southeast Corporate. “These discussions will provide an opportunity to lay out plans and obtain members’ input for Southeast’s next steps.” The plan calls for continuing to work with other corporates and industry partners to consolidate back-office operations and processes to lower costs, increase efficiencies, and provide best-of-breed products and services, Miller said. It also includes moving from a current 64% operating coverage ratio--non-interest income as a percent of operating costs--to 90% within three years. “This greatly reduces our reliance on investment income and means less risk to member capital,” he added. Within one year, Southeast Corporate intends to reduce the size of its balance sheet by about $1 billion and raise $80 million in new Perpetual Contributed Capital to support a $2 billion balance sheet. The intent is to build member value while continuing to provide needed payments, settlement, and liquidity services to members. The corporate plans further operating expense reductions and scale efficiencies through partnering arrangements that further aggregate payment volumes. Also, Southeast Corporate plans to recapture 20% of the balances that leave the balance sheet in existing and new off-balance-sheet products that generate fee income. Existing Member Capital Shares will be returned to members at the end of the three-year notice period, less any additional Other Than Temporary Impairments not covered by retained earnings that the corporate may need to take during this time period. “We’re confident this plan will allow Southeast Corporate to continue providing member-owners with the high-quality and competitively priced products and services they have relied on from us for over the past three decades,” Miller said “We’re eager to hear from members. One thing is clear: Our strength and future ability to meet their needs depends on their support.”

Webinars on SW Corporates biz model next week

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PLANO, Texas (12/9/10)--Webinars are scheduled for Dec. 15 and 16 to explain recommendations for the Southwest Bridge Corporate FCU business model. The bridge corporate’s Member Advisory Council met Nov. 30 to review its executive committee’s recommended business model. Council members approved recommending the consolidated business model with Georgia Corporate FCU to all 1,400 Southwest Bridge Corporate members and presenting it to the NCUA for approval. Highlights of the approved business model include:
* Acquisition by Georgia Corporate FCU, via a purchase and assumption process, in the summer of 2011. The perpetual contributed capital (PCC) subscription period would be from February to June 2011. * The PCC formula is 0.25% of assets with a maximum cap of $750,000, a cap of $600,000 for credit unions between $240 million and $750 million in assets, and a proportional threshold for credit unions $50 million or less in assets. * The consolidated corporate will continue to offer all critical products, including the off-balance sheet services provided by owned credit union service organizations, including Southwest Corporate Investment Services and CU Business Group. * The size of the consolidated balance sheet will be reduced to between $2.6 billion and $3.3 billion to minimize the amount of required PCC, while ensuring the ability to provide sufficient lines of credit to meet settlement and access to contingency lines of credit.

CU System briefs (12/09/2010)

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* SYRACUSE, N.Y. (12/10/10)--Whitney Allen, 22, of Syracuse pleaded guilty Thursday to stealing more than $6,375 from Syracuse-based Empower FCU from July 25 through July 30 in a check-cashing scheme. She was charged in Onondaga County Court with one count of third-degree grand larceny and six counts of falsifying business records by making improper withdrawals each of the six days. She deposited "dead checks" into an account and withdrew cash before the account was verified and also used a credit union ATM card at local retailers. She told police she learned the scheme from her mother, who was one of six others charged in the check-cashing scheme. In a plea bargain, she will receive straight probation with no jail time. Sentencing is set for Feb. 3 (The Post-Standard via syracuse.com Dec. 9) … * INDIANAPOLIS (12/10/10)--Financial Center (Finance Center FCU) has added ZashPay, a person-to-person service that allows members to transmit or receive money using their credit union account, to its BillPayer System. Members can send money to people by using their e-mail address or phone number, regardless of what financial institution the recipient uses. The payment is deducted from the sender's account and deposited directly into the recipient's account in one business day, said the credit union's press release. Finance Center has $409 million in assets …

Virginia CUs donate 35000 to food banks

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LYNCHBURG, Va. (12/10/10)--Virginia-based credit unions have donated $35,000 to aid the state’s food banks this holiday season. The contributions were facilitated by the Credit Unions Care Foundation of Virginia, a nonprofit dedicated to the charitable, educational and community causes supported by Virginia’s credit unions. The funds will be used by the Federation of Virginia Food Banks to aid its associated food banks statewide.
Click to view larger image The Credit Unions Care Foundation of Virginia donated $35,000 to the state's food banks Tuesday. From left, are: Roger Ball, CEO of Call FCU and foundation vice chairman; Bob Petty, CEO of Bronco FCU and a foundation board member; Leslie Van Horn, executive director of Virginia Food Banks; Audrey Bollinger, CEO of Peoples Advantage FCU and foundation treasurer; David Miles, chief operating officer for the Foundation; Gerrianne Burks, CEO of Northwest FCU and foundation chair; and Rick Pillow, president of the Virginia Credit Union League and a foundation board member. (Photo provided by Credit Unions Care Foundation of Virginia)
“This marks the largest single donation the foundation has made to date, which was made possible by the financial support of Virginia’s 190 not-for-profit credit unions,” said David Miles, foundation chief operating officer. “Our hope is that our donation will help our local food banks keep their shelves stocked this holiday season." Leslie Van Horn, executive director of Virginia Food Banks, said the resources of the state’s food banks are stretched thin as requests for food assistance soar. “People are struggling in this economy, with many individuals and families facing the grim reality of not knowing where their next meal may come from,” she explained. “Our food banks are working tirelessly to meet a growing need and we appreciate the support of Virginia’s credit unions as we work to fulfill our mission.” The Federation of Virginia Food Banks is a state association of food banks affiliated with Feeding America. The federation comprises seven regional Virginia and Washington D.C. food banks, with facilities in 14 strategic locations. The food banks distribute more than 70 million pounds of products annually to more than one million people through 1,940 member agencies. These agencies operate programs such as soup kitchens, after-school programs, senior centers and elderly feeding programs. Collectively, Virginia’s credit unions donated more than $881,000 and 13,021 volunteer hours to charitable and community organizations in 2009, according to the Virginia Credit Union League and the foundation. The Credit Unions Care Foundation of Virginia was established in May 2009, and raised more than $100,000 for causes during its first year.

Alaska USA is top SBA lender in state

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ANCHORAGE, Alaska (12/10/10)--Alaska USA FCU has been recognized by the U.S. Small Business Administration (SBA) as the 2010 Alaska SBA 504 Lender of the Year. Set up to contribute to the economic development of communities, the SBA’s 504 program provides long-term, fixed-rate financing designed for acquiring or renovating capital assets, such as land, buildings and equipment. The lender with the greatest number of approved loans as of the program’s year-end date of Sept. 30, 2010 is recognized. All of Alaska community-lending institutions were eligible. Alaska USA FCU has earned the award two years in a row. The credit union’s business and commercial services team is led by Senior Vice President Dave Hamilton. “As a key SBA lending partner, Alaska USA FCU plays a vital role providing access to capital for Alaskan entrepreneurs which allows them to grow and create jobs,” Karen Forsland, SBA Alaska district director, wrote in a letter to the credit union. Alaska USA FCU is a $4.1 billion-asset institution that serves more than 407,000 members, including about 10,400 business members.

Minn. network urges Switch to a CU in 2011

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ST. PAUL, Minn. (12/10/10)--With the New Year right around the corner, now is the time to resolve to switch to a credit union. This was the message Minnesota Credit Union Network President/CEO Mark D. Cummins sent to the readers of Finance & Commerce last week. A regular columnist in the Twin Cities publication, Cummins encouraged consumers to make a New Year’s financial resolution to discover their local credit union. The article, published Dec. 2, is entitled “A suggestion for Minnesotans’ New Year’s Resolution Lists” and outlines many reasons why consumers should switch to a credit union in 2011. It informs readers of the characteristics that make credit unions unique and highlights the benefits of credit union membership. Cummins also encourages consumers to not wait until Jan. 1 to join their local credit union. “Get ahead of the curve in accomplishing your first New Year’s resolution. Now is the time to discover a hometown financial institution that you can trust--one that provides professional and friendly service and saves you money in the meantime,” Cummins wrote. Cummins explained the attributes that set credit unions apart from other financial institutions, including the democratic structure, field-of-membership perimeters, and not-for-profit business model. He also overviewed the ways credit unions benefit consumers by creating a competitive financial services environment. “Credit unions believe that access to high-quality, low-cost financial services is critical to the financial health and stability of ordinary Minnesotans,” Cummins wrote. “While this has always been the credit union motto since the founding of the U.S. credit union movement 100 years ago, it is especially true in today’s economy.” To read the column, use the link.

CUs pledge 120M capital to Mid-Atlantic Corporate

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MIDDLETOWN, Pa. (12/10/10)--Mid-Atlantic Corporate FCU has received continued support from its member credit unions, who have committed more than $120 million in capital to the corporate. The commitment is being maintained even though the National Credit Union Administration (NCUA) has sent a letter to credit unions noting that "during the next year, boards will be expected to make a strategic decision about where to obtain essential services traditionally provided by the corporates." The corporate released its strategic plan in January and more than 650 credit unions committed $120 million in capital, said the New Jersey Credit Union League's newsletter (The Daily Exchange Dec. 8). "Mid-Atlantic Corporate has proven to be both innovative and experienced when it comes to financial performance, payment systems and operational expertise," the Middletown, Pa.-based corporate credit union said. The corporate "continues to be strong and steady, and we're confident we can continue to serve our members effectively under the revised NCUA rules," the article said.