Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

CU System Archive

CU System

Filene i3 tool gauges marketability of biz ideas

 Permanent link
MADISON, Wis. (2/27/08)--Aspiring entrepreneurs can test their ideas with The Big Idea Evaluator, an online business readiness tool developed by the Filene Research Institute’s i3 innovation group. The evaluator is based on respondents’ answers to questions in three categories: market, management and money. It provides feedback, offers advice and suggests resources to refine business plans. “It’s an opportunity for credit unions to provide business-friendly services that promise significant rewards in future business deposit and lending services,” said Lisa Renner, i3 member and CU Holding Company president/CEO. “It is just one tool that credit unions can use to attract boomers and provide services that contribute to the bottom line.” Baby boomers are forming small businesses at a higher rate than any other age group, and are more likely to see credit unions as relevant providers of financial services. “When we help members take their business ideas from conception to implementation, we are in an excellent position to earn their business checking and other deposit relationships,” Renner said. “For years the industry has looked for ways to attract younger members, ignoring the opportunity staring us in the face. We own this age group, and it’s just a matter of anticipating their next need so we can help them turn their dreams into reality,” she added. Also, i3 has launched the “What’s The Big Idea Challenge,” a three-question, online application that outlines the member’s business proposition. Mazuma CU in Kansas City, Mo., is piloting the challenge. Mazuma will accept entries through March 31. The challenge is open to members and non-members. The winner will receive a $3,000 marketing package with logo and stationery design, and printing.

CU System briefs (02/26/2008)

 Permanent link
* HAMPTON, Va. (2/27/08)--The Federal Deposit Insurance Corp. has issued a special alert after Langley FCU, Hampton, Va., reported that counterfeit checks with the credit union’s name are in circulation. The checks are associated with Internet sales and overpayment scams. The bogus checks have the routing number 096016765, which is assigned to U.S. Bank in St. Paul, Minn. At the top of the border on the counterfeit checks is the statement, “This face of this document has a multicolor background on white paper,” instead of “The face of this document has a multicolor background on white paper,” located on the top border of authentic checks ... * TACOMA, Wash. (2/27/08)--TAPCO CU of Tacoma, Wash., has introduced mobile banking. Members can view their account balances, transfer funds and pay bills with their cell phones. TAPCO has added mobile banking security precautions such as multi-factor authentication, member selected passwords, deactivation in case of a theft or loss, encryption of locally stored data and secure socket layer connection. TAPCO has $213 million in assets ...

Towns zoning law requires permit for CUs banks

 Permanent link
BELMONT, Mass. (2/27/08)--The town of Belmont, Mass., is taking legal steps to establish more control over the number of credit unions and banks moving in. A proposed zoning change would require financial institutions, including credit unions, to apply for a special permit before they can set up a branch in the town. Financial institutions do not add to the vitality of the downtown, according to Jay Szklut, Belmont planning and economic development manager. Some Belmont residents believe that financial institutions take up valuable retail space in the small town (Boston.com Feb. 24). Belmont, a Boston suburb with a roughly 25,000 residents, has one credit union--the $2.2 million asset Belmont Municipal FCU with 363 members--and seven banks. “We believe credit unions add to the vitality of every community that they are a part of,” Rob Kimmet, Massachusetts Credit Union League vice president of marketing and public relations, told News Now. “These moves by communities reflect concerns about large international and national banking entities coming in that don’t have a personality or stake in the community.” Because credit unions and banks close in the late afternoon and aren’t open on Sundays they don’t attract shoppers and their money, Szklut told the newspaper. In the town’s proposed zoning change, financial institutions are defined as establishments operating and engaging in deposit banking, and employing tellers, Szklut told the paper.

WOCCU Unfettered cooperatives maximize access

 Permanent link
WASHINGTON (2/27/08)--Consumers in Latin America need comprehensive financial services, and untaxed cooperatives can provide them with more affordable services, said the World Council of Credit Unions (WOCCU) during “Financial Inclusion in the Americas,” a two-day conference on consumer finances. The conference brought together 80 participants including industry officials from the U.S., Mexico, Guatemala, Honduras and El Salvador, to discuss how the countries can create more inclusive and broadly available services for their citizens. “In our experience, credit union systems grow and provide greater outreach when they are able to offer necessary products and services,” said Dave Grace, WOCCU vice president of association services. “The credit unions require unfettered access to payment systems, credit bureaus, card service providers and networks in order to do that.” Credit unions in Latin American countries are struggling in a share draft battle similar to the one U.S. credit unions fought in the 1970s, Grace said. “Of the countries represented, only Guatemala requires credit unions to pay income tax,” he added. “Taxation can be a threat to credit union survival, and ensuring tax exemption is a clear and demonstrable way for governments to encourage access to financial services.” The U.S. Treasury Department is in favor of increased credit union access to the population and has agreed to provide technical assistance to the four Latin American countries to broaden access to financial services, Grace said.

Small biz lending doing well despite credit crunch

 Permanent link
NEEDHAM, Mass. (2/27/08)--Global commercial and small business lending balances increased dramatically in 2007, despite the credit crunch caused by the subprime mortgage lending, according to new research from TowerGroup. TowerGroup’s research report, “From Crunch to Squeeze: Global Impact on the Credit Crisis on Commercial and Small Business Lending,” is authored by Patricia Hines, a senior analyst in Tower Group’s Wholesale Banking practice. TowerGroup is a research and advisory services firm that focuses on the financial services industry.
Click image for complete chart Click image for complete chart
Continued business lending growth is expected for 2008, driven most notably by emerging economies and by lenders targeting small and medium enterprises or middle market firms, TowerGroup said. More credit unions nationwide are offering small business loans to members, according to the Credit Union National Association. About 35% of credit unions nationwide offer service to small businesses, which include loans. Overall, the U.S. subprime mortgage crisis has had limited impact on worldwide commercial and small business lending, with volumes and loans outstanding increasing across all loans (see chart). The ripple effect on commercial lending has a lag time of several months, and the U.S. mortgage crisis is still unfolding. While TowerGroup expects loan loss reserves and loan charge-offs to increase in 2008 among commercial lenders, they should remain at manageable levels, the firm said. For the commercial and small business lending sectors, the greatest impact of ongoing instability in the credit markets is likely to be a renewed focus on traditional underwriting practices and the “three Cs” of credit: character, capacity and collateral. To continue on the industry’s recent growth track, commercial lenders must get back to basics to focus on credit quality, loan covenant enforcement, risk-based pricing, and strong loan documentation across all loan types, the report said. Tower Group believes that loan underwriters also will spend more time on risk assessment, financial statement analysis and legal review in 2008.

Wisconsin CU-backed personal data security bills advance

 Permanent link
PEWAUKEE, Wis. (2/27/08)--Wisconsin lawmakers are advancing two companion bills through the state legislature that Wisconsin credit unions have backed, and that aim to keep safer the personal data stored on credit and debit cards. The legislation--AB 745 and SB 439--introduced by State Rep. Brett Davis (R-Oregon) and State Sen. Bob Wirch (D-Pleasant Prairie), gathered 43 co-sponsors with strong bipartisan support during its initial circulation period at the Capitol, said the Wisconsin Credit Union League. AB 745 passed through the Assembly Committee on Financial Institutions last week by a vote of 9-1 and is expected to pass through committee in the state Senate today. “This legislation is just common sense,” said Brett Thompson, league president/CEO. “It has no effect on the state budget, but enormous impact on every consumer in Wisconsin who uses plastic cards for purchases.” Sensitive authentication data from credit and debit cards often is retained without cardholders’ knowledge and lost by companies who, by the credit industry’s existing standards, shouldn’t have collected and kept it in the first place, Thompson explained. The proposals would toughen industry standards dictating what information can be taken, transmitted and stored from a consumer’s credit or debit card. “Current law has allowed misbehavior related to payment card processing to go unchecked, and the result has been a tacit declaration of open season on consumers’ private information,” Thompson said. Nearly 75% of Wisconsin consumers support measures that would prevent merchants who accept plastic cards from keeping personal information after processing a transaction and require the breaching party to bear any restorative costs. The Community Bankers of Wisconsin, the Wisconsin Bankers Association, the Wisconsin Insurance Alliance, CUNA Mutual Group and the Wisconsin Federation of Co-ops also support the legislation.

Keesler FCU hit by cell phone text scam

 Permanent link
BILOXI, Miss. (2/27/08)--A cell phone text-message scam was targeted against Keesler FCU on Saturday, the credit union announced Tuesday. The cell phone text messages and faxes were broadcast to members and nonmembers in an attempt to get credit, debit or ATM card information, the Biloxi, Miss.-based credit union said. The messages appeared to come from the $1.5 billion credit union and requested that the recipient respond to the communication with the card number, personal identification number or other personal information. Keesler recently was also a victim of another e-mail phishing scam, according to Sharon Seanor, vice president of marketing at the credit union. "These fraudulent attempts were very sophisticated. They attempted to create a sense or urgency or panic, so that the recipient would be tricked to respond. For example, in this case, the scammers indicated that the recipient's bill service had expired," Seanor said. The credit union immediately posted a warning on its website and notified a local television station, which aired a story about the scam. The credit union said it would continue to educate members about how to avoid falling victim to fraudulent activity. "We will never initiate any communication to obtain account information, since we already have that information on file," said the release.