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Pay attention to card changes Hampel tells readers

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SAN DIEGO (2/23/10)--New rules for credit cards went into effect Monday, and consumers will need to monitor changes that their card issuers may implement, Credit Union National Association (CUNA) Chief Economist Bill Hampel told a San Diego newspaper. "The new rules are leading to changed behavior by card companies, and consumers would be very well advised to pay particular attention to terms and conditions, fees and rates on their cards to make sure they have the best deal," Hampel said in The Daily Transcript (via San Diego Source Feb.20). The new rules refer to certain provisions of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009 that became effective Monday. They limit interest rate hikes, restrict penalties and provide protections to help consumers pay their bills on time, said the newspaper. The article also referred to a recent study by CUNA and the Consumer Federation of America, which found that 85% of consumers are aware that the new regulation was going into effect Monday but they lacked specific knowledge of how the new law might impact their pocketbooks. The study found 36% of consumers believe that the new law caps late fees at $35, and 31% believe the cap is at 20%. The law does neither. While most organizations say the CARD Act is a step in the right direction, the newspaper reported, they also believe that consumers must be proactive in managing their debt and stay vigilant in monitoring their accounts for abuse.

CUs touted in IWall Street JournalI ICNNI

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NEW YORK (2/23/10)--CNN and The Wall Street Journal, in their coverage about the new credit card rules that became effective Monday, told consumers worried about increases in their credit card rates that they can go to credit unions for lower rates. On Monday, CNNMoney.com's Gerri Willis discussed the changes from several provisions of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. Calling the act a "new era with credit card companies playing by new rules," she noted that card companies will lose $11 billion a year in interest and fees, and to make that up, they will create new fees. Consumers who don't want to pay higher fees on their credit cards have several alternatives, Willis said. The first she mentioned was credit unions. "You can go to credit unions, which are less likely to charge fees and penalties on credit card accounts than banks do," she said. Willis noted one must be a member of a credit union through an organization. To find a credit union to join, "ask your employer or your college alumni association or go to creditunion.coop to find one." To see the broadcast, use the link and click on "Gerri's Top Tips" on credit cards. Saturday's issue of The Wall Street Journal also discusses the changes that began to take effect Monday. "Credit unions often offer lower rates than large banks, although some of their rewards programs are less generous than those of big banks," the Journalsaid. "There are more than 8,000 credit unions in the U.S., and they tend to have pretty expansive definitions of who can join. The criterion for joining some credit unions is as simple as your ZIP Code," the article said. "Navy Federal, the nation's largest retail credit union, offers rates as low as 7.9% on a basic platinum Visa card for three million members of the Army, Navy, Air Force, and Marine Corps and their families," said the Journal. "That compares with an interest rate as low as 11.99% on a Citibank Platinum Select MasterCard, touted as one of the cheapest rates around by Lowcards.com, a card-comparison website," the newspaper said. The average rate at the end of last year was roughly 14%, according to the Federal Reserve," the Journal reported. To view the article, use the resource link.

Southwest Corporate launches site to assist in comments

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DALLAS (2/23/10)--Southwest Corporate has launched a resource site on its website to assist and encourage credit unions to write comment letters about the National Credit Union Administration's (NCUA) Proposed Rule for Corporate Credit Unions (Reg. 704). The site contains links to the proposed rule, a copy of Southwest Corporate's comment letter, an executive summary of the letter and general tips to aid credit unions in offering their own comments. NCUA's deadline for comments is March 9. In a letter to Southwest Corporate's member credit unions last week, CEO John Cassidy urged interested credit unions to write comment letters asking NCUA to revise sections of its proposed rule. "Southwest Corporate believes its ability to continue to serve its member credit unions will be severely curtailed unless certain provisions of the proposal are modified," Cassidy said. In its comment letter to NCUA on Feb. 17, the corporate identified 14 issues that it said needed attention, including two key issues. The first is NCUA's proposed cash flow mismatch limitations. Under the proposal, cash flows of a corporate credit union's assets and liabilities would be so closely matched "that corporates would be unable to generate sufficient earnings, and the sustainability of any future corporate business model would be questionable," Cassidy said. "Unless this rule is modified, Southwest Corporate will not be able to comply with the retained earnings requirements that are also included in the proposal." The second issue relates to the transition period for corporates to meet the proposed rule's minimum risk-based capital requirements. It sets the effective date for two new risk-based capital requirements at one year after publication of Part 704 in final form. Southwest Corporate recommends the transition period be set at one year after the effective date of the publication of the revised Part 704 in its final form or one year after the implementation of a legacy asset solution--whichever comes later. "Such a transition period would provide all credit union industry participants with sufficient time to communicate, to implement a recapitalization plan, and to revise their respective business models," Cassidy noted. Southwest Corporate is also developing more Web-based resources to enable credit union leaders to explain to their members the background of corporate credit unions and the role they play in the cooperative credit union structure, said the corporate. For more information about the corporate's comment letter, use the resource link. The Credit Union National Association's (CUNA) Task Force released its report Monday at CUNA's Governmental Affairs Conference. (See RELATED STORY in News Now's Washington section, "CUNA task force calls for new corporate model.")

CU System briefs (02/22/2010)

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* GUERNEE, Ill. (2/23/10)--Guernee, Ill., police and the Federal Bureau of Investigation have offered a $20,000 reward for information leading to the arrest of a thwarted credit union robber who fired shots at police while exiting the building. The Jan. 29 incident involves a takeover attempt at the Community Trust CU, Gurnee. The lone robber forced his way into the credit union at 7 p.m. as it was closing, brandished a handgun and threatened employees. He used plastic zip ties to bind the hands of credit union employees, then tried to gain entry into the vault. He fled with $4 he took from an employee. As he exited he spotted a police officer responding to the robbery and opened fire. The officer was not injured. The suspect then fled behind a building. Police believe there was a getaway car waiting (The News Sun Feb. 4) ... * RALEIGH, N.C. (2/23/10)--State Employees' CU (SECU) members through the SECU Foundation are providing a 0% $500,000 construction loan for a new With Friends Residential Maternity Home in Gaston County, N.C. SECU Foundation's partner in the project is North
Click to view larger image Click for larger view
Carolina Housing Finance Agency. The foundation loan will provide an estimated savings of $30,000 to $40,000 for With Friends Inc., a nonprofit that services youth who are homeless, runaways or in crisis. The new home serves seven counties and will benefit pregnant teens or parenting homeless or displaced girls with babies. From left are: Ralph Robinson; Tuga Adams (directly behind Robinson); Mayor Jennie Stultz; Dr. Pat Krikorian; Nakeita Norman; Robert Becker; Mary Reca Todd; Stacy Cooper, vice president of SECU's Gastonia-Cox Road branch; and a local youth. (Photo provided by State Employees' CU) ... * LANSING, Mich.(2/23/10)--Members of NuUnion CU, headquartered in Lansing, Wednesday approved a merger with Detroit Edison CU (DECU), headquartered in Plymouth. The merger is pending approval from the Michigan Office of Finance and Insurance Regulation, the National Credit Union Administration, the Federal Trade Commission and the Department of Justice. It will create the fourth-largest credit union in Michigan--at $1.5 billion in assets--and positions the credit unions to serve both memberships with increased access to branches and ATMs, a stronger capital position and enhanced products and services. The new organization will become Lake Trust CU. "The Lake Trust name is representative of the new organization which will stretch from Lake Michigan to Lake Huron and Lake Erie," said Steve Winninger, NuUnion president/CEO. He will serve as the new credit union's CEO, while DECU CEO William J. Thiess will become president ... * PLANO, Texas (2/23/10)--EDS CU President/CEO Kent Lugrand announced that the credit union has changed its name to InTouch CU. The change was effective Feb. 16. "The new name defines our commitment to our members and our affiliated sponsor companies while also broadening the scope of our membership," Lugrand said. "As we look to enhance our financial position through sponsor companies, member and georgraphic growth in the communities served, changing our name was important to our fugure growth." With the new name comes a new logo and web address www.itcu.org. Lugrand noted the core values of the credit union and commitment to service will remain the same. "Our reason for being is to be 'in touch' with what our members want," he said ...

Oklahoma ECU site assists members on furlough

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OKLAHOMA CITY (2/23/10)--Oklahoma Employees CU launched a new website to help Oklahoma residents who are on job furloughs because of state budget cuts. The website, http://www.helpingok.com, contains furlough news, financial tools, resources, a blog and frequently asked questions (The Daily Oklahoman Feb. 21). “We were looking for a furlough resource site to recommend to our members and we realized that none existed for Oklahomans,” Mark Kelly, Oklahoma Employees CU president/CEO, told the newspaper. “We saw a need and made the decision to fill it. “We are hopeful that other organizations can become involved and offer special discounts on the site as well,” he added. Oklahoma Employees CU, based in Oklahoma City, has $289.3 million in assets.

ISt. Louis Post-DispatchI CUs a payday loan option

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ST. LOUIS (2/23/10)--Credit unions offer consumers a viable option to high-interest-rate payday loans, the St. Louis Post-Dispatch said Sunday. “Several area banks and credit unions have developed short-term, low-dollar loan products to compete with the payday lenders,” wrote Post-Dispatch columnist Mathhew Hathaway. “These loans--sometimes described as unsecured, revolving lines of credit or even ‘enhanced’ overdraft protection--aren’t cheap, but they’re a much better buy than the payday loans.” Financial institutions have difficulty contacting consumers considering a payday loan--often due to money mismanagement or a financial setback--but there’s a need for this type of loan product, Eric Acree, executive vice president of Vantage CU in Bridgeton, Mo., told the paper. “There’s probably some embarrassment, so they might not want to talk to us,” Acree added. “But they need to sit down with someone at their bank or credit union and talk about what else is available to them.” To read the column, use the link.

Iowa state leaders support CUs Little Guy (02/22/2010)

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DES MOINES, Iowa (2/23/10)--The Iowa Credit Union League (ICUL) held its annual Legislative and Regulatory Issues Conference Feb. 16-17 in Des Moines. More than 100 Iowa credit union representatives convened to learn more about the legislative issues affecting the credit union industry and interact with their legislators.
Click to view larger image Pictured at the Iowa Credit Union League’s annual Legislative and Regulatory Issues Conference Feb. 16-17 in Des Moines, are, from left: Jim Hagerman and John Houck of Lynn Area Community CU, Cedar Rapids, Iowa; State Sen. Swati A. Dandekar (D-18); Deb Salz and Alice Hagerman, Linn Area Community CU; and State Rep. Nick Wagner (R-36). (Photo provided by the Iowa Credit Union League)
Speakers included Iowa Senate Majority Leader Mike Gronstal and Iowa House Republican Leader Kraig Paulson, Gov. Chet Culver, Chairman of the Iowa Republican Party Matthew Strawn, and Tom Henderson, Polk County Democratic chairman. Culver praised the work credit unions do for Iowa communities and commended the on-going effort of credit unions to fully serve their members. Gronstal noted that credit unions are able to continue providing valuable financial service to their members, which is a testament of what makes Iowa’s credit unions so strong. Gronstal and Paulsen agreed that Iowa credit unions are an ideal model of the credit union movement’s cooperative spirit. Conference participants and state legislators were also introduced to “The Little Guy” who represents the Iowa men and women that credit unions serve.

WOCCUs Bierecki tapped for Polish national council

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WARSAW, Poland (2/23/10)--Grzegorz Bierecki, World Council of Credit Unions’ (WOCCU) second vice chair and president of the National Association of Cooperative Savings & Credit Unions (NACSCU), has been named to Poland’s National Development Council.
Grzegorz Bierecki, president of Poland’s National Association of Cooperative Savings & Credit Unions, explains Polish credit unions’ media strategy to a U.S. credit union delegation. Bierecki was named to Poland’s National Development Council. (Photo provided by World Council of Credit Unions)
The council is a newly established nonpartisan advisory body that offers input on social and economic issues to Polish President Lech Kaczynski. The appointment of Bierecki, who heads WOCCU’s member organization in Poland, was made Feb. 15 at Kaczynski’s invitation. “The appointment of the council is an expression of my well-established belief that a strategic plan is needed for the development of Poland from a long-term perspective,” Kaczynski wrote to Bierecki in a letter thanking him for his participation. “I do hope that the works of the council will introduce a new quality into the debate about the future of Poland. It is extremely necessary these days given both the national and international challenges that our country faces.” Kaczynski convened the council to better address issues critical to Poland’s social and financial well-being. Of the council's 44 members, Bierecki is the only representative chosen from among Poland’s financial institutions. The council’s 10-member financial team is rounded out by four university finance professors and five former finance ministers and deputy ministers. “The nomination of Grzegorz Bierecki is another example of the importance that President Kaczynski attaches to Poland’s credit unions, as well as to the personal role Grzegorz has had in their re-establishment,” said Pete Crear, WOCCU president/CEO. “Under his leadership, Poland’s credit union movement has become a true success story, not only in its rapid development, but in terms of the comprehensive financial services its credit unions provide to two million Polish families.” In addition to finance, council discussion topics will include Poland’s demographics, infrastructure, educational and scientific development and other subjects. The group will convene its next meeting in Warsaw on Thursday to discuss conditions and perspectives on Poland’s public finance situation. “Credit unions have played an important role in the transition of the Polish economy and society from communism to a market economy and democracy,” Bierecki said. “Now is the time to define their role in serving the future of Poland.”

iBelong campaign increased consumer awareness

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HARRISBURG, Pa. (2/23/10)--Three days of filming new iBelong commercials ended Saturday in the Philadelphia area, said the Pennsylvania Credit Union Association (PCUA). The commercials, which explain the benefits of credit union membership, aim to bring more consumer awareness about credit unions.
Syretta Washington, a credit union member, is participating in a video shoot for the Pennsylvania Credit Union Association's new iBelong commercial. (Photo provided by the Pennsylvania Credit Union Association)
The new spots feature various home and workplace settings and more than 20 randomly selected credit union members. They will begin airing in early April (Life is a Highway Feb. 22). In 2009, the iBelong campaign aired 12,149 television spots and 9,921 radio spots. Across the state, at least 83% of women ages 25 to 49 saw or heard an iBelong commercial at least five times a month, PCUA said. A survey of heads of nonmember households in the state found:
* Awareness of credit unions is up 10.2%; * Awareness that credit unions are owned by members is up 22.9%; * Awareness that credit unions have unique strengths is up 7.8%; and * Awareness that credit unions offer no or low fees is up 3.4%
Pennsylvania credit unions saw growth in membership that outpaced the national average for the last two quarterly reports, said PCUA. Member growth in the state was 2.3%, compared with the national growth rate of 1.6%.

National foundation presents four Wegner Awards

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WASHINGTON (2/23/10)--For the second straight year, the National Credit Union Foundation (NCUF) presented four Herb Wegner Memorial Awards at its annual dinner Monday night. Nearly 900 credit union leaders and supporters attended the event held in conjunction with the Credit Union National Association's Governmental Affairs Conference in Washington, D.C. "This year’s winners join an elite group of 43 individuals and 19 organizations whose extraordinary efforts over the past 22 years have earned the credit union movement’s highest national honors,” said emcee Bob Schumacher, CEO of MountainCrest CU, Arlington, Wash. Awards and recipients include:
* Lifetime Achievement Award: Richard Marriott Heins, retired president/CEO of CUNA Mutual Group, Madison, Wis.; * Individual Achievement Award: Richard “Dick” L. Ensweiler, president/CEO of Texas Credit Union League; * Outstanding Organization Award: MultiCultural Banking Center, Harbor One CU, Brockton, Mass.; and * Outstanding Program Award: National Financial Literacy Program, the Emmy-awarding public broadcasting show Biz Kid$, Washington Credit Union League.
Schumacher, who also chairs NCUF’s Awards and Recognition Committee, remarked that “Each year when I attend this special event, I re-dedicate my life to advancing our great credit union movement. The achievements of every Wegner Award winner can inspire in all of us a desire to do our very best to better the lives of credit union members.” For more information about the winners and the awards, use the resource link.