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Oregon banks oppose plans to move city deposits to CUs

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PORTLAND, Ore. (2/15/12)--The Oregon Bankers Association is opposing a proposal by Portland, Ore., Mayor Sam Adams to move some city funds to local credit unions and smaller banks. However, the Northwest Credit Union Association (NWCUA) says the city should keep local funds local.

"This is just positioning on behalf of the Oregon Bankers Association and nothing new," said Stacy Augustine, NWCUA senior vice president and general counsel.

"How the public's money is safeguarded and managed should indeed be the paramount concern for the City of Portland when it comes to its banking relationships, just as [Oregon Bankers Association CEO Linda] Navarro pointed out," Augustine told News Now. "We just think the city should consider keeping local funds local."

According to an article in the Portland Business Journal, the bankers association and Wells Fargo oppose the proposal, which would direct the city treasurer to deposit up to $250,000--the maximum that is insured-- into 10 credit unions and other community banks during 2012. The city also would deposit more than $250,000 in a single credit union if it meets certain criteria.

The bankers association, in a letter to the mayor, brought up the old  "credit unions were meant to serve people of modest means" rhetoric and said the city would lose tax revenues if it moved its deposits to credit unions. Wells Fargo, which had won the bidding process in 2009 to provide financial services to the city, said in another letter it considered itself a local bank that makes lending decisions locally and keeps deposits in the Portland market.

The article said public sentiment heavily favors the proposal with 15 of 17 comments on the city's website supporting the plan. In addition, 12 comments that were e-mailed to the mayor also favored the move.

CMCFCU members vote to merge with Members First

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MIDLAND, Mich.  (2/15/12)--Members of Central Michigan Community FCU, Clare, Mich., voted last week in favor of its merging with Members First CU, Midland, Mich. The continuing credit union will be Members First, effective June 1.

Central Michigan members voted five to one in favor of the merger (OurMidland.com Feb. 13). Michigan's Office of Financial and Insurance Regulation and the National Credit Union Administration already had approved the proposal to merge.

The merger will combine Members First's assets of $191 million and Central Michigan Community's assets of $110 million into a combined $310 million asset credit union serving 30,000 members.

Central Michigan was established in 1948 to serve employees of Clare Manufacturing Co. before expanding into a community chartered credit union. Michigan First was established to serve school employees.

MetaBank settles with CU over fraud

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BERLIN, N.H. (2/15/12)--A notice of settlement was filed Feb. 6 in a U.S. District Court in Concord, N.H., for a class action lawsuit brought by lead plaintiff Guardian Angel CU, Berlin, N.H., and other financial institutions against  Iowa-based MetaBank and Meta Financial Group. The financial institutions sought funds they lost when a MetaBank employee embezzled more than $4 million by selling false certificates of deposit (CDs).

Terms of the settlement were not disclosed. The order filed by U.S. District Judge Paul Barbadoro gave the parties 20 days to file any objections  or motions to intervene, with written responses  due in 30 days. A hearing has been scheduled for March 26 to work out final approval, according to the court document.

Barbadoro in July had refused to dismiss the case, in which Guardian Angel and 34 other depository institutions alleged the bank had breached its contract by negligently allowing an employee to steal about $4 million in 2005 (NHBR.com Feb. 14). His decision did not allow punitive damages or attorney's fees.

The former MetaBank employee, Charlene Marie Pickhinke of Sac City, Iowa, who was a branch office supervisor, was sentenced in 2009 to seven years in a federal prison after pleading guilty to one count each of wire fraud, making a false statement in a bank's books or records, money laundering and aggravated identity theft.  She had faced a possible sentence of 82 years in prison.

Pickhinke worked for the bank from 1979 to 2007 and allegedly sold the CDs, suing MetaBank's name, via an independent broker. She instructed purchasers to wire the funds into one of several false accounts she created at the bank. About 50 credit unions and banks lost funds when she sold the fake CDs and pocketed the money (Des Moines Register July 11, 2009 and News Now July 14, 2009). 

MetaBank's parent company, Meta Financial Group, is based in Storm Lake, Iowa. MetaBank has 13 branches and $686 million in assets.

Guardian Angel, which has $41 million in assets, lost about $99,000 in April 2005, according to the original complaint. Four credit unions were among the eight groups that sued MetaBank in 2008 and 2009 over the fraudulent transactions.

CUNA committee releases board succession planning paper

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MADISON, Wis.  (2/15/12)--A new white paper from the Credit Union National Association (CUNA) reveals that most credit unions do not have a reliable system for attracting the next generation of board members.

CUNA's paper examines the demographics of community credit union board members, the issues that arise from the findings and strategies for successful board succession and retention.

The paper, "Effective Credit Union Board Succession Planning," commissioned by CUNA's Community Credit Union Committee, evaluates the changing demographics of community credit union board members and notes that many boards struggle to reflect the growing diversity of their members, with women and minorities being underrepresented.

Through credit union case studies and a list of expert recommendations, the paper shows how successful board succession planning looks in the real world, discusses what credit unions can do to reverse certain negative trends and provides instructions for how credit unions can prepare for the future.

Some example topics include:

  • Creation of an associate director program;
  • (Re)consideration of term limits;
  • Development of an "evergreen" list; and
  • Continuing education requirements.

"CUNA's Community Credit Union Committee has done an excellent job of identifying and addressing a critical issue facing many credit unions," said Todd Spiczenski, CUNA vice president for the center for professional development.

"Many credit unions face serious problems if board succession plans are not effectively put into place and changes are made to attract new board members," he added. "This white paper provides many practical tips and suggestions that any credit union can incorporate into its daily operations to reverse the worrisome trends seen in board demographics."

To view the full white paper, at no cost, use the link.

To learn more about CUNA's Community Credit Union Committee and its mission, use the link.

Oscar winner Maine CUs announce 450K raised for hunger

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PORTLAND, Maine (2/15/12)--Maine credit unions raised $446,929.56--an increase of nearly $45,000 over last year's record--during their 2011 Campaign for Ending Hunger, the Maine Credit Union League announced Monday.

Maine credit unions raised $446,929.56 during their Campaign for Ending Hunger in 2011. The Maine Credit Union League made the announcement Monday during the Thaw to End Hunger Celebration Event. Pictured, from left, are Luke Labbe, chair of the league's Social Responsibility Committee; Ernest Thompson, Academy Award Winning writer of the movie "On Golden Pond"; John Murphy, president of the Maine Credit Union League. (Photo provided by the Maine Credit Union League)
In addition to raising a record-setting amount in 2011, the campaign also surpassed the $4 million milestone in funds raised since the campaign began 22 years ago. 

"The generosity of the over 615,000 credit union members in Maine is extraordinary," John Murphy, league president of the Maine Credit Union League said during the Thaw to End Hunger Celebration Event on Monday. "This marks the 16th consecutive year that the Campaign has raised a record-setting total, and the milestone of the campaign surpassing the $4 million mark in funds raised since the campaign began--a remarkable effort in such a challenging economy."

The celebration was a luncheon event, and featured an address by award-winning author Ernest Thompson, who helped to unveil the big check announcing the total raised.

Ernest Thompson won an Academy Award and Golden Globe for writing the classic film, "On Golden Pond," which is based on Thompson's summers at Belgrade Lakes in Maine. "On Golden Pond" was named as one of the Top 100 romantic films of all time by the American Film Institute.

Since 1990, the Maine credit unions' campaign has raised more than $4.3 million. All money raised goes directly to end hunger and stays in Maine.

W.Va. CUs gain press for outpacing national growth

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PARKERSBURG, W.Va. (2/15/12)--West Virginia credit unions' assets grew 6.6% as of June 30 from June 2010--more than double the national median rate of 3%. Full 2011 figures are not yet available.

Projecting out to year-end 2011, credit union assets in the state will exceed $3 billion for the first time--a significant milestone, said Rich Schaffer, senior vice president of the West Virginia Credit Union League (Charleston Gazette Feb. 12).

In the mid-1990s, credit union assets in the state surpassed $2 billion, which was a big accomplishment, he told the newspaper.

Those figures don't include the effects of Bank Transfer Day on Nov. 5 and its aftermath, the paper said.

Also, loans at West Virginia credit unions grew modestly in the year ending June 30--rising 0.4%--but besting the national median, which was a 2.1% decrease.

Citing auto loans as the "bread and butter" of credit unions, Schaffer told the paper he predicts a full percentage point gain in the state's credit union loans for calendar year 2011.

Co-op launches mobile app to log volunteers hours

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CABOT, Vt. (2/15/12)--Cabot Creamery Cooperative has launched Reward Volunteers, the first U.S. mobile app that allows volunteers to log hours, post to Facebook and win rewards for themselves and the organizations they serve. 

The app is one of the International Year of Cooperatives' initiatives developed under the auspices of the National Cooperative Business Association's International Year of the Cooperatives Steering Committee, which includes CUNA among its members.

Cabot Creamery is a sponsor of CUNA's weekly Home & Family Finance Radio program.

Reward Volunteers is easy to use, said Cabot Creamery. Volunteers select the organization for which they are volunteering, log the length of time volunteered, and post their efforts on Facebook. They can win prizes for themselves and nonprofit organizations by increasing their logged hours, sharing post/photos, sending e-mails, and securing Facebook "likes" for their volunteer posts.

To download the free app, visit iTunes.

Cabot developed Reward Volunteers in collaboration with Chalo Inc., a social business start-up. It can be used on the iPhone, iPad, iPod Touch, and as a Web-based program on RewardVolunteer.coop.

For more information, use the link.

CMG CEO featured on Discovery webinar Feb. 29

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MADISON, Wis. (2/15/12)--CUNA Mutual Group President/CEO Jeff Post will present a Discovery Webinar "Special Feature" on risks and opportunities facing credit unions at 12:15 p.m. CT Feb. 29.

The webinar will be followed by a live question-and-answer session.

"Navigating Today's Risks to Capitalize on Today's Opportunities," recorded at a recent presentation Post made to a Louisiana Credit Union League Roundtable, will be presented as part of the Discovery Webinar series.

The 75-minute event is free. Credit unions can register online. Use the link.

Post will spell out the many challenges facing credit unions, including global economic duress, regulatory issues and new competition. He also will tell credit unions that business as usual is no longer an option and that there are opportunities for organizations with strong leadership.

"Credit unions can differentiate themselves and take advantage of the anger many consumers are feeling over big banks, but it will require clear strategies and sound expense management," Post said. "Credit unions cannot let themselves become paralyzed by the risks they face."

CUNA Brokerage names 2012 women of distinction

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MADISON, Wis. (2/15/12)--CUNA Brokerage Services Inc. is honoring 24 financial advisers with Women of Distinction awards for their superior performance, value to their investment and insurance programs, exceptional client service, and contribution to the financial services industry and the company.

Created by women, for women, the Women of Distinction awards recognize the top performing female financial advisers within CUNA Brokerage Services' broker/dealer operation nationally.

"Their contributions to the clients they serve, the financial services industry and to the women they mentor are exemplary and worthy of recognition," said Jim Metz, president of CUNA Brokerage Services, Inc.

Candidates are nominated by industry peers. Then, selections are based on the nominee's annual performance and outlined contribution to their clientele, the credit unions they serve and the financial services industry. 

Award recipients participate in a national mentoring program to work with other female advisers who are new to the industry or those who wish to grow in their profession.

2012 Women of Distinction recipients include:

  • Catherine Barnes, VyStar CU, Orange Park, Fla.;
  • Emmor Boslet, Belco Community CU, Camp Hill, Pa.;
  • Julie Brand, First Light FCU, El Paso, Texas;
  • Jody Brown, Summit CU, Madison, Wis.;
  • Jane Brockway, University of Illinois CU, Champaign, Ill.;
  • Kathy Chesney, Pacific Marine CU, Oceanside, Calif.;
  • Ellen Coppinger, Y-12 FCU, Oakridge, Tenn.;
  • Wendy Cundari, North County CU, San Diego, Calif.;
  • Carol Diest, First Community FCU, Kalamazoo, Mich.;
  • Judy Ebert,  Deere ECU, Moline, Ill.;
  • Mary Finnegan-Ongaro, Members Cooperative CU, Duluth, Minn.;
  • Leigh Glover, Southeast Financial FCU, Brentwood, Tenn.;
  • Kim Hamblin, America First CU, Ogden, Utah;
  • Tiffany Haupert, Beacon CU, Wabash, Ind.;
  • Anna Kamp, Anheuser-Busch Eemployees CU, St. Louis;
  • Jane Kilby, VyStar CU, Orange Park, Fla.;
  • Michelle Luce, Great Northwest FCU, Aberdeen, Wash.;
  • Stephanie Morales, Arizona Central CU, Phoenix, Ariz.;
  • Pamela Schwartz, Alcoa Tenn FCU, Alcoa, Tenn.;
  • Swan Shen, RTN FCU, Waltham, Mass.;
  • Kim Shirk, Heritage CU, Newburgh, Ind.;
  • Cindy Sforza, Schools First FCU, Huntington Beach, Calif.;
  • Suzi Williams, Yakima Valley CU, Yakima, Wash.; and
  • Gale Zumpano; Alabama CU, Tuscaloosa, Ala.
 

CUNA Brokerage Services Inc. uses face-to-face financial advisers to help credit unions meet member retirement, investment and insurance needs. Working onsite at credit unions, financial advisers provide members with financial services from simple transactions to complex financial planning and wealth management services.

Kansas CUs meet with lawmakers recognized as co-ops

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TOPEKA, Kan. (2/15/12)--The Kansas Credit Union Association's (KCUA) Annual Day at the Capitol attracted 140 credit union representatives from across Kansas to the Statehouse on Feb. 7 to discuss key issues affecting the state's 100 credit unions and the 625,000 members they serve.

Kansas Credit Union Association President/CEO Marla Marsh with Kansas Treasurer Ron Estes during KCUA's Annual Day at the Capitol Feb. 7. Kansas credit unions partner with Estes' office to bring financial literacy programs like Money$mart camps to schools.
Legislators in both the Kansas Senate and House of Representatives recognized 2012 as the International Year of Cooperatives during their sessions, and Kansas credit unions were acknowledged for their role in the cooperative industry.

State Sen. Marci Francisco (D) said she was glad to see credit union representation in the audience during the cooperative recognition program.

"I want to thank all the members of credit unions, and all the other cooperatives that are doing business in every county in our state as financial associations, rural electricity and telecommunication providers, natural foods grocery stores, housing co-ops, and grain and supply distributors," Francisco said. "Their members are not only helping themselves and their families, but also helping make our communities great places to live."

Attendees discussed the state of the financial services industry in Kansas and told legislators they were concerned with steep compliance costs associated with growing regulatory issues. Credit union representatives also reminded policymakers that credit unions are a valuable option for consumers and that they remain strong and well-capitalized.

Lee Williams, right, CEO of Central Star CU, Wichita, Kan., talks with State Sen. Dick Kelsey and wife Doris Kelsey at the Kansas Credit Union Association's Annual Day at the Capitol. (Photos provided by the Kansas Credit Union Association)
"Kanas credit unions continue to lend to and serve the state's 625,000 credit union members, and are faring better than credit unions nationwide," said Marla Marsh, KCUA president/CEO.

"We appreciate legislators recognizing the services that we provide to Kansas communities," Marsh said.

In addition to meeting with state legislators, credit union staff heard from Senate President Stephen Morris (R), Senate Minority Leader Anthony Hensley (D), House Majority Leader Arlen Siegfreid (R), and House Minority Leader Paul Davis (D) during an afternoon leadership panel.

After visits with legislators at the Capitol, the participating credit unions met in asset-size roundtables to discuss issues specifically related to their asset category.

During the event, KCUA's Young Professional Council also met with lawmakers. Watch for a story about that later this week in  News Now.

League valentine unveils expanded Facebook page

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ALBANY, N.Y. (2/15/12)--The Credit Union Association of New York (CUANY) unveiled its expanded Facebook page Tuesday, with a Valentine's Day promotion, "You Don't Have to Love Us…Just Like Us!" to build awareness of the changes.

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"Social media has been a growing area of focus for the association, as I believe it has for all organizations," said William J. Mellin, CUANY president/CEO. "We've watched its progression and have been evaluating how we can use social media to be of better service to our credit unions, built a real sense of community and offer an engaging social media destination for New York credit unions."

The page, at www.facebook.com/CUANY.org,  includes association updates, industry news, exclusive tools and resources, photos and more. It offers a fresh look at the association's four core areas of service: governmental affairs, regulatory compliance, education and training, and outreach. It also highlights CUANY's member relations team, includes a new tab housing its blog, and has tabs so visitors can follow tweets from Mellin and the association's senior vice president, general counsel and lobbyist, Michael Lanotte.

The association will conduct a drawing to win one of 50 custom-designed T-shirts as part of the promotion. Deadline for the drawing is Feb. 29.

CU System briefs (02/14/2012)

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  • COLUMBUS, Ohio (2/15/12)--Three credit union executives from Northeast Ohio traveled to Capitol Hill in Washington, D.C.,  last week to encourage lawmakers to back legislation that would enable credit unions to do more member business lending (MBL), according to Crain's Cleveland  (Feb. 13). They were accompanied by representatives from small businesses and discussed raising the MBL cap to 27.5% from 12.25% to provide more business lending to small businesses when they need it the most. The current cap deters credit unions from seriously pursuing MBL activities, the group said. In the article, Paul Snyder, vice president for marketing at CSE FCU, Canton, told lawmakers it is building a fourth branch but not expanding its MBL or related staff because of the cap.  The Ohio Credit Union League was quoted in the article saying a handful of credit unions in the state are close to bumping the current cap.  The Credit Union National Association and credit unions are urging Congress to raise the cap so credit unions can inject $13 billion in loans into the economy and create 140,000 new jobs, at no expense to the taxpayer …
  • LEXINGTON, Ky. (2/15/12)--The Lexington, Ky.-based University of Kentucky FCU's  (UK FCU) "Lipstick on a Bank" campaign, with the slogan, "You can put lipstick on a bank, but it's still a bank," is attracting attention. To get across the message that UK FCU is a better value than a bank and that consumers can kiss bank fees goodbye, the campaign uses bright pink lipstick marks on  billboards around the city, in-branch signage, post cards, and buttons for sales staff. It also gives away Chapstick and has a microsite, www.lipstickonabank.com. Since the campaign began at the beginning of the year, the site has had more than 2,600 unique visitors …
  • SOUTH BURLINGTON, Vt. (2/15/12)--NorthCountry FCU, based in South Burlington, Vt., has selected its executive vice president, Bob Morgan, to succeed John Benoit as CEO, announced Kathy Sweeten, chair of the credit union's board of directors. Benoit, who  will retire after 30 years at the credit union, will officially step down in March but will retain the title of president through the completion of several large projects this year, said the Association of Vermont Credit Unions (Newslines Express Feb. 10). His official departure date has not been determined. Under his leadership, the credit union grew from $6 million in assets to more than $350 million, with six branches serving members. Morgan has worked with the credit union since 2000. He serves on the Association of Vermont Credit Unions' board of directors, where he has chaired the Social Responsibility Committee since 2006  …