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Agility offers checklist for spring floods

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CHARLOTTE, N.C. (3/15/11)--This week is Flood Safety Awareness Week, and CUNA Strategic Services provider Agility Recovery is urging businesses--including credit unions--and families to make sure they are prepared for springtime flooding. The National Oceanic and Atmospheric Administration (NOAA) has predicted wide scale springtime flooding for many communities throughout the nation, and it has joined forces with the Federal Emergency Management Agency (FEMA) to commemorate the week. Businesses all over the U.S. have committed to preparing for the devastating effects of heavy winter snowstorms, the subsequent spring thaw and traditionally storm spring weather. Floods are the "nation's most common and expensive natural disaster" and can strike any community, said FEMA Administrator Craig Fugate, in a press release from FEMA and NOAA, He encouraged businesses and families to take these simple steps to protect themselves and their property: learn about their risk of flooding; keep an emergency preparedness kit; store important documents in a safe place; and consider purchasing flood insurance. "Flooding accounts for a large percentage of recoveries our company has performed for members over the past two years," Agility Recovery CEO Bob Boyd said in a separate press release. "The average flood insurance claim amounts to over $33,000, but the costs to a business can be far greater when considering lost revenue, lost customers and the domino effect up and down your supply chain." Several sources exist to assist businesses and families to prepare for flooding:
* Agility Recovery has shared a Flood Preparedness Checklist of the most important steps to take. * FEMA's Flood Safety Awareness landing page provides access to FEMA's resources. * The Institute for Business and Home Safety has information about protecting the business.
To access the sources, use the links.

Older long-time members more satisfied with CUs

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EMERYVILLE, Calif. (3/15/11)--Older and long-time credit union members are more satisfied with their credit unions than younger, newer members are, according to a national survey of members. Roughly 5,000 credit union members were surveyed last fall, according to MyCUsurvey.com, an online phone and Web-based member research tool for credit unions. The survey was designed to provide a benchmark against which credit unions can gauge their own performance. The survey revealed three key factors that indicate credit unions could be at risk and need to improve satisfaction among newer, younger members. The factors are member age, frequency of branch visits and length of membership. Among the findings:
* Members older than age 65 were 30 points more satisfied with their credit unions than members under age 30. * Members who visited their local branch at least once a week demonstrated 10 points higher satisfaction than those who visited less frequently and 14 points more than members who never visit their local branch. * Newer members are not as satisfied, with a 15-point spread in satisfaction ratings between those who had been members for one year or less, and those who belonged to the credit union for 10 years or more.
The findings are "critical indicators for the credit union industry," said Dr. Jack Bieda, founder of MyCUsurvey.com. "The convenience of Web and mobile banking and other trends are undermining credit union satisfaction. It's clear that credit unions need to find a way to attract younger members and get them to visit their branches for a more personalized banking experience in order to cement the member relationship," he added. The benchmarking data, which is updated every six months, measures overall satisfaction, willingness to recommend, interior branch satisfaction, exterior branch satisfaction, and service-level satisfaction. MyCUSurvey.com was launched by PinPoint Research. Surveys are conducted using MyCUSurvey's Web/interactive voice response system to avoid the risk of interviewer bias. When the survey reveals a dissatisfied member, the survey can initiate an "instant alert" so the credit union member service team can follow up with the member.

Tsunami didnt damage CUs Economy insurance hit

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MADISON, Wis. (3/15/11)--Friday's catastrophic earthquake and tsunami in Japan and the resulting tsunami waves that hit Hawaii and the U.S. West Coast did not directly affect credit unions, according to CUNA Mutual Group and the World Council of Credit Unions (WOCCU). Japan has few credit unions. WOCCU said it does not have an affiliated organization in Japan. The Association of Asian Confederation of Credit Unions--which serves a number of Asian countries and is based in Thailand--is a member organization of WOCCU but doesn't have represented credit unions from Japan. In the U.S., credit unions in Hawaii and along the West Coast reported no damages. "Although the damages in Japan are tremendous, both from the earthquake and tsunami, all credit unions CUNA Mutual contacted in Hawaii Friday report they suffered no damages from the tsunami that struck there Friday morning," said Phil Tschudy, media relations manager with CUNA Mutual Group. "We also have no reports of any tsunami-related losses along the West Coast of the continental U.S.," he told News Now. Credit unions are preparing to do what they can to help with relief efforts. Two California-based credit unions that serve Japanese-American communities are waiving fees for wire transfers so members can help families back in Japan. Nikkei CU, a $68 million asset credit union based in Gardena, began immediately eliminating fees that normally accompany outgoing wire transfers to Japan. The fee will be waived until April 30, it said on its website. JACOM CU, an $84 million asset credit union based in Los Angeles, also plans to waive fees. The UW CU in Madison, Wis., announced Monday that its members could donate directly from their Web Branch accounts to the American Red Cross to support the disaster relief. UW CU said that when members log into the Web Branch, they will find a Red Cross icon to click at the top of the main page with instructions for directing money from their accounts to the relief fund. Meanwhile analysts are predicting that the disaster will impact Japan's economy. Some say the impact won't be as severe on the economy of Japan, because it will begin rebuilding. However, it would add to Japan's debt. The country has the world's highest debt at 200% of gross domestic product (USA Today March 14). The New York Times said the economy impact is spreading, with nuclear plant problems threatening to cause an energy squeeze that could set back all sectors of the country's economy. Although power cutbacks and rolling blackouts are expected to last up to two weeks, some analysts say that if longer cutbacks could seriously affect Japan's ability to produce goods for an extended period. The Bank of Japan has already eased monetary policy by expanding an asset buying program, said the Times. The property casualty insurance industry is already estimating the costs of insuring the properties destroyed in the catastrophe. One catastrophe modeler estimated losses would be at $35 billion, according to PropertyCasualty360.com (March 14). Smaller reinsurers may suffer losses that impact their capital positions, said Standard & Poor's MarketScope Advisor. It predicted claims would set new records, and losses from the Japan earthquake and tsunami--as well as other catastrophic events this year--could spark a firming of worldwide insurance and reinsurance rates. The 8.9 earthquake--the largest in Japan and the fifth largest in the world--knocked the island of Japan eight feet closer to the U.S. and produced a 23-foot tall wall of water that slammed into Japan's eastern coast. It also created a multiple nuclear reactor nightmare Thousands are feared dead in Rukuzentakata and Sendai. It also created nuclear reactor concerns about five nuclear plants and forced the evacuation of nearly 200,000 people who lived near one of the reactors (USA Today March 14).

Americas CUs raise 8.7M in 2010 for kids hospitals

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SALT LAKE CITY (3/15/11)--Credit Unions for Kids announced today that it raised $8.7 million for Children's Miracle Network Hospitals in 2010. That marks a 5% increase over fundraising in 2009, and positions credit unions as a top three contributor to the charity. Credit Unions for Kids is a collaborative effort in the credit union community that raises money for children's hospitals. Since 1996, the program has raised more than $80 million for Children's Miracle Network Hospitals throughout the U.S. In 2010, Texas was No. 1 in statewide fundraising, generating nearly $1.37 million in contributions. The top five states and the amount raised by credit unions include:
* Texas, $1,367,597; * California, $1,003,530; * Oregon, $924,972; * Arizona, $479,674; and * Georgia, $479,235.
Portland, Ore., was once again the top individual market, raising $726,395. The top five individual markets include:
* Portland, $726,395; * Phoenix, $432,824; * Austin, Texas, $417,411; * Atlanta, $396,934; and * Los Angeles, $365,641.
"2010 was a remarkable year for our credit union partners," said John Lauck, president/CEO of Children's Miracle Network Hospitals. "Their performance speaks volumes about the character of those in the movement. Given the unprecedented challenges facing the industry, credit unions could have cut back on their fundraising, but instead they grew the program and in turn helped our hospitals impact the lives of more kids and their families." In 2011, credit unions will have three new national campaigns from which to support their local Children's Miracle Network Hospital. The Change a Child's Life coin collection campaign, which kicked off March 1 and concludes April 30, is still accepting orders for free kits to help facilitate fundraising efforts. Use the link for more information. The other two campaigns include Miracle Jeans Day, Aug. 1-Sept. 14, and the Holiday icon program, Nov. 1-Dec. 31. For more information, contact either Joe Dearborn, senior director for Children's Miracle Network Hospitals at jdearborn@cmnhospitals.org or Felicity Guerin, Credit Unions for Kids liaison at fguerin@cuna.coop.

Corporate Central well-capitalized on new measures

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MUSKEGO, Wis. (3/15/11)--With the support of existing members and a stream of new capital members, Corporate Central CU in Muskego, Wis., has achieved the “well-capitalized” mark across all capital measures of the new National Credit Union Administration corporate credit union regulations. Results indicate:
* Tier 1 (core) capital ratio stands at 5.10%, above the 5% well-capitalized mark; * Tier 1 (core) risk-based capital ratio is 30.87%, above the 6% well-capitalized mark; * Total risk-based capital ratio jumped to 61.37%, ahead of the 10% well-capitalized measure; * Total capital ratio stands at 10.13%; and * Retained earnings ratio is 1.30%, more than two-and-a-half times the three-year 0.45% regulatory requirement.
Equally as important to capital is the net economic value (NEV) of a corporate credit union’s balance sheet, said Corporate Central. NEV measures the value by taking the fair value of assets minus the fair value of liabilities. The regulations require a minimum NEV ratio of 2%. Corporate Central CU has a base-case NEV ratio of 11.25%. “At a time when others are redefining business models, shrinking balance sheets and formulating capital building plans, Corporate Central CU stands strong and well-prepared to provide solutions for credit unions and to continue responsible growth today,” said Robert W. Fouch, president/CEO. “The key to our success has always been the support of our members and the stewardship responsibility demanded by our board of directors,” he added. “Strong governance ensured no capital impairment for our members; resounding commitment from members enables strength going forward; and steadfast pursuit of member service excellence by all staff contributes to a successful future.” Corporate Central CU offers independent correspondent services delivered through partnerships serviced by Corporate Central staff. All investment and liquidity products historically provided to members continue today. Also, the corporate has partnered with Sallie Mae to offer the Sallie Mae Smart Option Student Loan program.

Texas CUs finish 2010 with 9.8 net worth

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FARMERS BRANCH, Texas (3/15/11)--Credit unions in Texas finished 2010 with a net worth of 9.8%, almost three points higher than federal examiners benchmark for well-capitalized financial institutions, according to the 2010 year-end Texas Profile. In the past five years savings in Texas credit unions grew by over $17.7 billion and loans by $9.4 billion (LoneStar Leaguer March 14). Although still strong, savings growth rates in Texas credit unions finished the year at 7%, down from the 11.6 % in 2009 and 12.1% in 2008, but still higher than the pre-recession levels. The membership growth rates were also down, indicating that the wave of dissatisfied banking customers has passed. As experienced across all financial institutions, consumers continued to pay down debt and avoid adding new debt. Credit unions’ loan growth rate was 2.6% at year end. This has caused the loan-to-share ratio to decrease to 73.4% from a high of 82.2% prior to the recession. Sixty-day delinquencies also receded. Return on assets for Texas credit unions increased to 55 basis points, a 16-point jump from the previous year and more than double the position in 2008. Net-interest margin also increased to 342 basis points. Overall market penetrations by Texas credit unions grew during the previous year and were above the 2006 level. Credit union market share increased for credit cards, unsecured loans, used automobiles, first mortgages and share-draft accounts as consumers took advantage of lower rates and better terms.

Low-income service providers struggle to meet demands

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HARRISBURG, Pa. (3/15/11)--A survey of low- and moderate-income (LMI) households in the Third Federal Reserve District shows that their financial well-being has declined, according to the Pennsylvania Credit Union Association. As households’ needs for services, such as education, employment, financial aid, food, health care and housing has increased, the organizations that provide these services to LMI populations have not increased their capacity as quickly and have actually seen decreases in funding overall (Life is a Highway March 14). This is an opportunity for credit unions, which could step up their efforts to fill the gap in services. The Federal Reserve Bank of Philadelphia’s Community Development Studies and Education Department last week released the results of its first Community Outlook Survey (COS), which monitors economic factors affecting LMI households in the Third Federal Reserve District. The survey, which will be conducted quarterly, asked 104 participants, who are service providers to LMI households, to evaluate how the financial conditions of their clients had changed from the third quarter to the fourth quarter of 2010. They were also were asked about their expectations for financial conditions three months from January 2011. Results indicated:
* More respondents reported that the availability of jobs had decreased rather than increased, but expectations for the next three months were more optimistic; * 17% of participants said that the availability of affordable housing had increased, while 46% indicated no change and 38% reported that it had decreased; * 99% of participants reported no change or a decrease in the financial well-being of LMI households in the fourth quarter of 2010; * 56% indicated that access to credit had stayed the same and 44% reported that it had decreased; and * Most service providers (71%) saw the demand for their services increase from the third quarter to the fourth quarter of 2010, with only 3% reporting a decrease and 26% indicating that demand had remained the same.
The percentage of organizations expecting an increase in demand for their services is greater than the percentage expecting an increase in capacity to help meet the increased demand. Thirty-five percent indicated that funding had decreased.

Kansas CUs end year with more assets members

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WICHITA, Kan. (3/15/11)--Kansas-chartered credit unions added both more members and assets in 2010, according to the state regulator. The Kansas Department of Credit Unions’ Fourth Quarter 2010 Call Report Statistics showed that as a whole, the state’s credit unions increased teir assets 4.08% to $4.02 billion between 2009 and 2010. Annualized membership growth was 3.71% during the same time period. The Wichita Eagle March 12). Loans increased 6.21% to $2.7 billion in 2010. Kansas credit unions’ return on average assets ratio was 0.71% compared with 0.47% a year ago, the report said. Delinquency ratios were down, from an average of 1.57% to 1.34%, according to the report. The number of state-chartered credit unions in Kansas dropped by one during 2010, to 81. Wyandotte CU merged into Lenexa-based Mainstreet CU, with $263 million in assets, on Dec. 31.

CU System briefs (03/14/2011)

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* WASHINGTON (3/15/11)--Pictures and a video of the 23rd Annual Herb Wegner Memorial Awards at the Credit Union National Association's Governmental Affairs Conference in Washington D.C., last month are now available. Those who want to revisit the festivities or who missed it and would like to catch a glimpse of the evening can access these at the links. The National Credit Union Foundation celebrated the achievements of Rudy Hanley, Dan Mica and the National Youth Involvement Board. As in prior years, people can order a DVD of the entire awards ceremony, which includes the winners’ videos, acceptance speeches, and more. To view the Wegner Award photos use the link. To view the Wegner Award video, use the link. Those with questions should contact Josie Collins by e-mailing jcollins@ncuf.coop or calling 800-356-9655, Ext. 4397 … * SACRAMENTO, Calif. (3/15/11)--The Golden 1 CU is hiring to fill 36 positions, according to local media (modbee.com March 14). The openings include call center representatives and supervisors, tellers, branch operations and sales managers, loan officers and consultants. Donna Bland, CEO and chief financial officer, told the publication the credit union expects a strong 2011 after a period of controlling expenses during which existing employees absorbed increased workloads. The credit union has about 1,200 employees and 85 branches …

League board election results announced

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FARMERS BRANCH, Texas (3/15/11)--The Texas Credit Union League (TCUL) announced that voting is complete for the mail-ballot election of league director positions for asset categories B and E (LoneStar Leaguer March 14). Elected were:
* Z. Suzanne Chism, president of Texas Health Resources CU, Dallas, for Asset Category B-- $10 million to $20 million; and * Kay Stewart, president, North East Texas CU, Lone Star, Asset Category E--more than $100 million.
The other asset categories were uncontested elections, with these individuals elected:
* Carol Murray, chairman of the supervisory committee of Express-News FCU, San Antonio, Asset Category A--under $10 million; * Nancy Croix Stroud, president, First Class American CU, Fort Worth, for Asset Category C-- $20 million to 50 million; and * Wayne Mansur, president, Texoma Community CU, Wichita Falls, for Asset Category D--$50 million to $100 million.
For this election, the directors will serve a one-year term. The 2011-2012 terms officially begin after the league annual membership meeting and board organization meeting in April.