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Scots angry at banks boost CUs membership 38

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GLASGOW, Scot. (3/23/09)--Glasgow's City Council reported that applications in western Scotland to join some credit unions have risen by about 38% in the past six months, as potential members seek a financial institution they can trust. West of Scotland NHS Employees CU saw a 38% increase in applications for new memberships during that time period because people are uncertain about the current banking situation and are placing more trust in credit unions, Robert Kelly, general manager, told BBC News March 20). Scotwest CU CEO Rod Ashley told BBC that his credit union has recruited more than 3,000 new members--a 12% increase since January 2008--from throughout western Scotland. Over the past six years, Glasgow's 35 community and industrial credit unions increased six-fold in membership and managed assets. They now have 110,000 members combined. Around one in five people in Glasgow are believed to be credit union members, the highest urban membership rate in the United Kingdom.

CU System briefs (03/20/2009)

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* RALEIGH, N.C. (3/23/09)--Members of State Employees' CU have topped $20 million in People Helping People Scholarships, provided through the SECU Foundation to students in every traditional public high school in North Carolina. The four-year college scholarships, valued at $10,000 each, are awarded to graduating seniors to study at one of 16 constituent campuses of the University of North Carolina System … * RALEIGH, N.C. (3/23/09)--Local Government FCU's (LGFCU) special affinity Visa Check Card exclusive to all North Carolina's firefighters and their families has resulted in $254,316 in donations to the North Carolina State Firemen's Association (NCSFA). The bright red cards feature a firefighter's helmet. Instead of fees coming from firefighters and their families, store merchants pay the fees to process the debit card transaction, and LGFCU takes half the fee for every purchase and directs it to NCSFA. According to LGFCU President Maurice Smith, the partnership generates about $20,000 per quarter in donations. More than 4,000 of the cards are in circulation (Weekly Update March 20) … * KANSAS CITY, Mo. (3/23/09)--Mazuma CU, based in Kansas City, Mo., has presented a $40,000 endowment to the University of Missouri-
Click to view larger image Click for larger view
Kansas City (UMKC), according to the Missouri Credit Union Association (The Missouri difference March 20). The endowment will provide two $1,000 scholarships for years to come--one to a student in the Business and Public Administration School and one to an Education School student. In the photo, Mazuma President/CEO Rob Givens, left, presents the endowment on Feb. 25. (Photo provided by the Missouri Credit Union Association) … * GIG HARBOR, Wash. (3/23/09)--Harborstone CU has decided to offer reverse mortgage services to its senior members. The Tacoma, Wash.-based credit union partnered with Security Reverse Mortgage, Gig Harbor, Wash., to offer the Security Reverse Credit Union Program to educate, process and fund reverse mortgage loans for senior members. Over 25% of the credit union's members qualify for a reverse mortgage, said Roger Johansen Sr., vice president of lending at the $550 million asset credit union. Seniors often have difficulty paying for living expenses due to inflation and reduction in retirement accounts, said the credit union. A reverse mortgage helps members increase monthly cash flow and retire their monthly mortgage payments, said Harborstone …

CUs auto loan workout options aid struggling members

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EUGENE, Ore. (3/23/09)--Northwest Community CU has seen its auto repossessions double in the past two years, but says it is still happy to lend. To help, it is providing its members with several loan workout options. Northwest is allowing members to skip two loan payments per year, and hundreds of members have taken advantage of that offer. The credit union also sent direct mailings to members last fall letting them know they have options. “We’ll find ways to make things work,” Matt Purvis, Northwest vice president of marketing told News Now. Some other options Northwest offers include interest-only payments for several months, no payments for several months, or reduced payments. So far, 120 have taken advantage of the modifications. “We’re promoting this,” Purvis said. “We’re telling members, ‘Don’t wait. Come in and let’s talk.’” During the first half of 2007, Northwest averaged about 28 repossessions per month. In 2008, that figure jumped to 66. Of those 66, more than half were voluntary. There are 32 additional auto loans--totaling about $500,000--pending in Northwest’s rework file. From last fall to March, Northwest altered more than $2 million in auto loans. But those loans made up only 1% of the credit union’s auto loan portfolio. Modifications are “a lot of work, and use a lot of people,” he said. “The numbers are holding steady,” Purvis said. “We haven’t seen it tail off yet, but we’re looking forward to that day.” Layoffs and a slow motor home and wood products industry have rippled across the region. Northwest was originally created to serve wood products workers. “It’s very slow,” Purvis said. “It’s never been what it was.” Many defaults have resulted from layoffs or significant pay cutbacks. Often two-income families have lost one income, making it tough for members to pay their bills on time. Northwest watches local and regional news for industry cutbacks and keeps in touch with members whose jobs may be in danger. And although auto lending is slow, the credit union keeps expanding its portfolio. “We’re very active in commercial loans and are promoting Invest in America,” Purvis said. Invest in America is a national program by that offers auto loan discounts to credit union members through General Motors and Chrysler. “We’re trying to raise our profile and let people know we’re investing in communities,” he added.

Invest in America grows in February

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LANSING, Mich. (3/23/09)--The Invest in America campaign closed about 32,000 vehicle sales in February, on top of 25,000 in January, for a total of 57,000 sales in the two months since the program went national. Invest in America is credit unions’ auto loan discount program with auto manufacturers General Motors Corp. (GM) and Chrysler Corp. The program started in December with a four-state pilot program for GM and a 12-state pilot for Chrysler. The campaign includes contractual credit union member incentives from GM and Chrysler. GM is offering supplier pricing, which averages about $1,500 per vehicle, with its Credit Union Member Discount, and Chrysler is offering $500 or $1,000 rebates through its Credit Union Member Cash program. The nationwide program is on a 90-day pilot with GM and a 180-day pilot with Chrysler. All 7,800 U.S. credit unions are eligible to participate in and market the program to their nearly 90 million credit union members. Collectively, U.S. credit unions have about $160 billion in capital to lend. About 70% to 80% of the 57,000 sales were financed by credit unions, estimated David Adams, CEO of CUcorp and president/CEO of the Michigan Credit Union League, in a conference call Friday. “Those sales are coming during the toughest months of the year,” Adams said. “We’re confident that credit unions are making a significant impact in the auto industry when it really matters.” So far, support for the program has come from more than 1,000 credit unions nationwide, and 40 state credit union leagues and associations support it. Credit unions’ share of auto loans rose to about 25% in January, compared with 14.8% in March of 2008, Adams added. Invest in America is a “natural” due to the collective customer bases of credit unions and General Motors (GM), Mark Degnan, GM director of local advertising and marketing, said during the conference call. “Credit unions have loyal customer bases and that has helped us gain customers through Invest in America,” he said. “It’s been a [beneficial situation] for GM, credit unions and dealers by adding additional credit capacity for consumers.” A strong percentage of the program participants appear to be first-time buyers. About 66% are either buying a GM vehicle for the first time, or are former GM customers who left and now have come back to purchase a GM vehicle through the program, Degnan said. Also, five of the 10 largest U.S. credit unions have begun to market the program, including: Navy FCU, Vienna, Va.; Suncoast Schools FCU, Tampa, Fla.; The Golden 1 CU, Sacramento, Calif.; Ent FCU, Colorado Springs, Colo.; and State Employees CU, Raleigh, N.C.

Huffington on IMSNBCI Bolster CUs

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WASHINGTON (3/23/09)--Credit unions are healthy and should be bolstered, according to Arianna Huffington, co-founder and editor in chief of The Huffington Post. Huffington appeared on MSNBC’s “Morning Joe,” show Friday morning to talk about the financial crisis, specifically related to news of American International Group’s bonus package. “There’s a lot of good stuff happening in this country--look at credit unions,” Huffington said. “How many people know that credit unions are healthy, they keep lending money and there have been no problems with them? “Why not bolster what is good in our economy as opposed to continuing to subsidize what is not working?” she added.

Robbery suspect nabbed with bomb in getaway car

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WASHOUGAL, Wash. (3/23/09)--A man who allegedly robbed a credit union in Washougal, Wash., was arrested Wednesday after he told police he had a bomb inside of his car. Shawn Bromley allegedly stole money from a branch of Lacamas CU, Camas, Wash., Wednesday. Police chased him after the robbery until Bromley crashed his car. After the crash, he told police that he had a bomb inside of his car--which the Federal Bureau Investigation later confirmed (KPTV.com March 19). The bomb was safely removed from the vehicle, and Bromley was taken into custody. Police have not yet disclosed the amount of money taken from the credit union, or whether Bromley was injured during the crash.

N.Y. CUs tell media why they want MBL cap lifted

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NEW YORK (3/23/09)--Loosening restrictions on member business lending at credit unions would not only help small businesses access sorely needed credit, it would also encourage more credit unions to get in the game, several New York credit unions told the media. The additional $10 billion in credit nationwide that could be freed up if the cap--12.25% of total credit union assets--was lifted would constitute a considerable amount of cash that could be injected into businesses, Edward Paternostro, CEO, Nassau Educators FCU, Westbury, told the Long Island Business News (March 19). Also, easing the cap restrictions would encourage more credit unions to take part in commercial lending, Bob Allen, CEO, Teachers FCU, in Farmingville, told the newspaper. With the current cap, smaller credit unions have higher costs with business lending than they make in return on their assets, Allen said. Also, if credit unions could make more commercial loans, they could lend to micro-cap businesses--which are too small to get bank loans, he added. A higher cap would allow credit unions to put more resources, staff, marketing and technology behind business lending, Allen told the paper.

Federation CDFI Fund outstrips previous actions

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NEW YORK (3/23/09)--The size and speed of the Treasury’s funding for the Community Development Financial Institutions (CDFI) Fund far outstrips any previous CDFI Fund actions, says the National Federation of Community Development Credit Unions. CDFI’s Fund--just weeks after receiving a $100-million allocation from the American Recovery and Reinvestment Act of 2009--has released its plan to award and disburse the monies in record time. The larger awards will be awarded by the end of June, with a “supplemental” round awarded by the end of September. A total of $145 million will be awarded to CDFIs nationwide. Under the plan:
* CDFIs with applications pending in the current round (2008-09) can amend their applications and apply for an increased amount--up to $2 million for Financial Assistance, and $600,000 for the Small and Emerging CDFI Assistance program. It is anticipated that about $90 million will be awarded by the end of June. * CDFIs that do not have a current application pending can apply for funding totaling $50 million, to be awarded by Sept. 30. Unsuccessful applicants in the June round will be eligible to reapply in this supplemental round. * No matching funds will be required for either round. * Native American CDFIs also will benefit from a higher ceiling on awards and an increase in the total number of Native American CDFI Assistance awards.
The CDFI Fund declared that it will make more awards than in previous rounds and dig further into the applicant pool. Also, awards may be larger than in past years. On Tuesday, from 4:00 p.m. to 5:00 p.m., the federation will be hosting a web conference for its members to discuss the new changes. A representative from the CDFI Fund will be on the call to answer questions, and federation staff will discuss the various resources available to CDCUs. For more information, use the link.

CU Day attracts 100 Vermont lawmakers

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SOUTH BURLINGTON, Vt. (3/23/09)--Vermont credit unions' Credit Union Day in the Vermont Statehouse attracted more than 100 state legislators, who stopped by the Association of Vermont Credit Unions' (AVCU) display Thursday.
Posing with the Association of Vermont Credit Unions' (AVCU) display in the Statehouse are, from left, University of Vermont faculty member and Chittenden County Rep. Ann Pugh; Richard Brock, AVCU legal counsel/lobbyist; and Adam Necrason, AVCU lobbyist. (Photo provided by the Association of Vermont Credit Unions)
AVCU management and its lobbying team spent the day chatting with lawmakers, answering questions, distributing informational handouts, and registering legislators for a random drawing for a Garmin GPS navigation system. The winner will be presented at AVCU's annual Legislator Appreciation Reception in late April. According to AVCU President Joe Bergeron, advocacy for Vermont credit unions is the association's primary mission. "This day in the Statehouse, and our upcoming Legislator Appreciation Reception, are integral components of our overall effort to make sure legislators understand what credit unions are all about," he said. "Connecting lawmakers with credit union leaders, and maintaining a positive dialogue with the legislators who ultimately determine the regulatory landscape under which we operate, is one of our most important functions," Bergeron added. Throughout the day, conversation focused on the state and national economies, said AVCU. Legislators expressed their understanding that credit unions played no part in causing the turmoil and continue to act responsibly to help their members. In its display, AVCU used graphics from the Credit Union National Association's "Credit Unions Look Out for the Little Guy" campaign to reinforce the message. "We heard many legislators speak positively about credit unions and the efforts they've made during these adverse economic times," said Bryan Kent, AVCU vice president. "Several of the legislators we spoke with expressed their appreciation for all that credit unions are doing to help consumers weather the storm."

League of Southeastern CUs announces new board

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BIRMINGHAM, Ala. and TALLAHASSEE, Fla. (3/23/09)--The League of Southeastern Credit Unions (LSCU) announced its new 16-member board of directors. The new board, which consists of eight representatives from Alabama credit unions and eight from Florida credit unions, will preside over LSCU--the entity formed from the recent consolidation of the Alabama and Florida Credit Union Leagues. Each state’s previous board chairman became a member of the new board and selected seven board members from their states to serve on the LSCU board. Executive officers will be elected at an upcoming organizational meeting. The LSCU board of directors consists of:
* Ola Anise--Azalea City CU, Mobile, Ala.; * Alvin Cowans--McCoy FCU, Orlando, Fla.; * Dale Dalbey--Mutual Savings CU, Birmingham, Ala.; * John Hirabayashi--Community First CU of FL, Jacksonville, Fla.; * Rich Helber--GTE FCU, Tampa, Fla.; * Brent Lister--First Florida CU, Jacksonville, Fla.; * Pat Mason--Sun CU, Hollywood, Fla.; * Joe McGee--Legacy Community FCU, Birmingham, Ala.; * Greg Olmsted--North Alabama Educators CU, Huntsville, Ala.; * Larry Scott--Campus USA CU, Gainesville, Fla.; * Deborah Seymour--Multi-Media CU, Orlando, Fla.; * Bob Steensma--Five Star CU, Dothan, Ala.; * Steve Swofford--Alabama CU, Tuscaloosa, Ala.; * Linda Walker--Riverdale CU, Selma, Ala.; * Tina Williams--The Infirmary FCU, Mobile, Ala.; and * Mary Wood--West Coast FCU, Clearwater, Fla.
The memberships of the Alabama and Florida leagues recently voted to combine the two organizations into one, which represents 332 credit unions with combined assets of $55 billion. As the League of Southeastern Credit Unions (LSCU), the joining of these two entities will create a stronger, more strategically situated organization, the league said.

No cease and desist here CUs cooperate instead

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GREENSBORO, N.C. (3/23/09)--Two credit unions across the country from each other found out they're using the same slogan in their membership campaigns, "Membership Matters." But, instead of one issuing a cease-and-desist order against the other, the two took their cooperative nature to heart. Unitus Community CU, a $734 million asset credit union in Portland, Ore., created the "Membership Matters" slogan for its campaign, only to discover that Charlotte, N.C.-based Carolina Postal CU already had a trademark fo the phrase, said the North Carolina Credit Union League (Weekly Update March 20).
Deb McLean of Carolina Postal CU offered to lease the credit union's campaign slogan, "Membership Matters." Laurie Kriesl of Unitus Community CU took the offer as part of the cooperative philosophy of credit unions. (Photos provided by the North Carolina Credit Union League)
Pat Smith, CEO of Unitus contacted the $62.8 million asset Carolina Postal to see if something could be worked out. Carolina Postal turned out to be a willing colleague. "We've been there," Joy Watts, Carolina Postal CEO, told the league, "and I knew exactly what Pat was feeling. We've had a terrific campaign, or a new product, just rolled out, only to receive a 'cease and desist' letter from a credit union in another state. It was so frustrating when the other credit unions would not partner with us on sharing the phrase or slogan. Especially irritating was the fact that our territories and member base didn't cross over or even come close to one another." When she joined Carolina Postal in 2007, Marketing Vice President Deb McLean was instructed by the board to trademark every phrase and slogan she created. "I was surprised but I understood the frustration," she said. "I agreed to do it, but only if we could take it to the next level." The next level in this case turned out to be McLean contacting Unitus to offer a lease for the phrase for a year or two, according to Laurie Kresl, Unitus vice president of marketing. The credit unions' territories didn't overlap and they both had clearly defined, limited fields of membership in each state. Sharing wouldn’t hurt each other's brand nor cause member confusion, said McLean. The decision made sense, she said, adding that credit unions who demand the cease and desist are "extremely short-sighted. They are simply lock-stepping to their lawyer's tune to 'protect' the trademark versus thinking outside the box." Leasing a trademark could become an income provider for credit unions and serves the credit union industry as a whole to work together as a cooperative movement, McLean said. "Now more than ever, credit unions need to go back to our core philosophy and work together," McLean said. Kresl agreed. "This is yet another example of how we, as credit unions, can set ourselves apart from the banking industry."