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Canadian CU Centrals merger hinges on 100 million buyout

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TORONTO (4/16/08)--A proposed merger of Credit Union Central of Ontario and Credit Union Central of British Columbia hinges on whether Ontario's credit unions will agree to provide up to $100 million to buy frozen asset-backed commercial paper (ABCP) from the Ontario central. According to The Globe and Mail (April 15), Credit Union Central of Ontario approached its member credit unions about buying the frozen ABCP during its annual meeting the weekend of April 5. They will vote on the proposal on May 31. Art Chamberlain, spokesman for Credit Union Central of Ontario, said that if the proposal fails, the merger will be called off. If members approve the plan, the paper will move from the central's books to a trust fund for the credit unions, and the merger will take place. The association was stuck with $161 million of the short-term instruments after $35 billion of Canadian ABCP were frozen last August after buyers disappeared due to fears the investments were linked to U.S. subprime mortgages. The market turmoil forced the two centrals to postpone their merger, which had been expected to close last September. If the ABCP plan is approved, the merger will take place July 1. Roughly $32 billion of the frozen ABCP is expected to be restructure by that date, pending a vote by all ABCP investors.

MnCUN elects new directors

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BLOOMINGTON, Minn. (4/16/08)--The Minnesota Credit Union Network elected table officers and four incumbent representatives at its Annual Meeting and Convention April 11-12 in Bloomington, Minn. Representatives elected to three-year terms on the board are:
* Kyle Markland, Affinity Plus FCU, St. Paul; * Richard Nesvold, SouthPoint FCU, Sleepy Eye; * Bill Raker, US FCU, Burnsville; and * Randy Willert, Greater Minnesota CU, Mora.
Table officers for 2008 are: Chairman Harry Carter, TopLine FCU, Maple Grove; Vice-chairman Markland; and Secretary/Treasurer Patrick Pierce, City and County CU, St. Paul. About 450 credit union professionals and volunteers representing 75 credit unions attended the meeting.

Says CUAO Oregons CUs a sound option amid market turmoil

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BEAVERTON, Ore. (4/16/08)--Oregon consumers can rely on credit unions for financial safety and soundness, the Credit Union Association of Oregon (CUAO) said Monday. As news about turmoil in the banking industry spreads, credit unions are being commended for the services they provide. They also tend to make more conservative business decisions and investments, which helped credit unions avoid the subprime mortgage mess, the association said. “The lure of profit margins to be had in the subprime mortgage market didn’t make a lot of business sense for credit unions,” said Pamela Leavitt, CUAO senior vice president of governmental affairs and public relations. “The underlying volatility in these types of loans put up glaring red flags to credit union decision makers. The consensus credit leaders made on subprime lending was ‘no thanks.’” Credit unions offer lower loan rates and higher savings rates than banks, the association said. “Credit unions have always been, and are today, a positive in the financial marketplace. Our hope is that consumers take this opportunity to look around and see that there is another choice available to them for all their financial transactions,” Leavitt added. Oregon credit unions have served 1.4 million members since the 1920s.

IMarketWatchI to African-Americans Consider a CU

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PALM BEACH GARDENS, Fla. (4/16/08)--African-Americans who want to gain more access to credit, should consider a credit union, according to a Monday article by MarketWatch columnists. Gail Liberman and Alan Lavine cite a new report titled “Credit Card Redlining” by Ethan Cohen-Cole, financial economist for the Federal Reserve Bank of Boston, that finds African-Americans are offered less credit than their white counterparts. Obtaining credit is key to financial success, according to most economists, the columnists said. Among the five steps that can help consumers seeking credit, the columnists listed: “Before applying for a loan … contact more than one institution, and consider credit unions, which often have some of the lowest rates. “Find a credit union you can join at (Credit Union National Association). Avoid loans with prepay penalties,” they continued.

Sub-Zero layoffs may impact small CU

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MADISON, Wis. (4/16/08)--Layoffs at a manufacturer of high-end refrigeration and cooking appliances could have an impact on a small Wisconsin credit union that serves some if its employees. About 200 Madison area employees will be laid off from Sub/Zero Wolf of Fitchburg, Wis. Of those, about 125 belong to Members First CU, Madison, according to Nicholas Kessenich, president of the credit union. “I do not know how much of an impact it will have on our credit union,” Kessenich told News Now. The $15.5 million asset Members First serves about 15 different employer groups, Kessenich said. It has about 2,680 members. “We will work with each of the laid-off employees who are our members as much as we can to help them,” Kessenich said. “There are different ways we can work with people on this.” Some of the ways the credit union can help members is to give them loan extensions and rewrite loans to give members a lower monthly payment, Kessenich said.

DuTrac Community CU in Iowas first IDA program

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DUBUQUE, Iowa (4/16/08)--DuTrac Community CU has been asked to participate in Iowa’s first credit union individual development account program--the Credit Union Family Partnership Program. Individual development accounts (IDAs) are matched savings accounts, in which a participant’s savings are matched by a grant from another organization. Participants must meet income guidelines to qualify for an IDA account. DuTrac will open the savings accounts and match the funding, thanks to private grants the credit union received from the Iowa Credit Union Foundation. Savings and matching funds are used by the individual to purchase a specific asset--such as financing a home, starting or expanding a business, paying for education or job training, or purchasing a vehicle to get to work. “Iowa credit unions are in a unique position to offer no-cost savings accounts to families and individuals who need help saving,” said Marybeth Foster, executive director of the foundation. “Our immediate goal is to offer financial education and a method of saving for a specific asset.” The $325.6 million asset, Dubuque, Iowa-based credit union will work with the foundation, the Iowa Credit Union League, the league’s subsidiary Coopera Consulting and other statewide partners to develop the IDA program. The program is expected to launch in summer 2008.

CUNAs online youth magazine redesigns middle-school level

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MADISON, Wis. (4/16/08)--New interactive features were recently added to the middle-school level of CUNA’s three-in-one online youth magazine, Googolplex. “AJ’s” allows middle-school readers to:
* Log in with their own screen name and save favorite content; * Post notes to other users (this feature is moderated); * Create a hero icon and invite their friends to join their league of heroes; * Submit questions for possible use in an upcoming reader poll; * Request notification of new content on specific topics; and * Read the Kid Kred comic strip online and vote to determine the direction of future episodes.
AJ’s also has new, challenging games and brainteasers that keep the site interesting and relevant to the age group. Middle schoolers can still learn how to earn and manage their money through stories. Googolplex offers credit union-specific consumer stories and games designed to make youth of all ages feel welcome on credit union websites. New content is added weekly throughout Googolplex’s three reading and interest levels:
* 5-Spot--addresses basic money concepts such as saving and spending for elementary students; * AJ’s--helps middle schoolers tackle popular topics such as making friends, getting rich, and shopping; and * C-Note--contains financial and personal advice on common interests, such as cars, college, getting rich, and shopping for high school students.
For more information, use the link.

CU System briefs (04/15/2008)

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* MADISON, Wis. (4/16/08)--CORRECTION: A News Now item on federal law changes in student loans incorrectly reported Tuesday that two large student-lender credit unions had pulled out of the federal student loan program. The University of Southern California credit union and the University of Texas credit union have not dropped out of the Federal Family Education Loan and Direct Loan programs. News Now regrets the error … * MANCHESTER, N.H.--America's Credit Union Museum's board plans a Oct. 23 premier showing at the Palace Theatre, Manchester, N.H., of its 100th Anniversary Video to celebrate the founding of the U.S. credit union movement. It also encouraged submissions of memorabilia for the museum and contributions to help it retire its mortgage and begin building an endowment for future operations. Use the link for the full story.

The museum board includes, from left: Daniel F. Egan Jr., president, Massachusetts and New Hampshire Credit Union Leagues and Credit Union Association of Rhode Island; Ronald J. Rioux, president/CEO, St. Mary's Bank CU; Peter J. Lemire, Esq.; Gordon A. Simmons, museum board chairman and president/CEO, Service CU; Michael L'Ecuyer, president/CEO, Bellwether Community CU; Dick Ensweiler, president/CEO, Texas Credit Union League; Peggy Powell, museum executive director; Rudy Hanley, president/CEO, Orange County Teachers FCU; John Murphy, president, Maine Credit Union League; Francois G. Henriquez, senior vice president and general counsel, U.S. Central CU; and Pete Crear, president/CEO, World Council of Credit Unions. (Photo provided by the New Hampshire Credit Union League) … * DENVER, Colo. (4/16/08)--Former legendary Colorado State University football coach Sonny Lubick has been hired as vice president of community outreach and public relations at Public Service CU. He will help the credit union develop relationships and membership in Larimer County. "We will be working hard to meet the financial service needs of the people of Northern Colorado," said PSCU President/CEO David Maus. Coach Lubick said, "When I first began my teaching career, I got my first car loan from the teacher's credit union." He noted credit unions made an even greater impact on his and his wife Pat's lives when Hurricane Andrew destroyed their home in 1992. "We had nothing left, and the credit union gave us $10,000 to help us get back on our feet. It was a life-saver when we did not know where else to turn," he said. PSCU recently acquired Norlarco CU and has retained more than 90% of the previous local staff … * SACO, Maine (4/16/08)--PeoplesChoice CU has introduced a mobile banking service, where "members can securely view their account balances, transfer funds and receive customized alerts about their account status, such as low funds," said President Luke Labbe. The $133 million asset credit union has taken precautions, including multi-factor authentication, member-selected passwords and secure socket layer connection, to ensure data security … * WASHINGTON (4/16/08)--Fraudulent traveler's checks, bearing a number of financial institutions' routing numbers and variations of their names, are reportedly in circulation, said the Federal Deposit Insurance Corp. (FDIC). The fake checks include a statement, "Issued by Federal Credit Union, D.C." The items don't indicate any affiliation with a major traveler's check issuer and are referred to as "Travelers Cheques." They have been presented in $100 denominations. The front of the items include an American flag overlaid with the Statue of Liberty and the U.S. Capitol, with "Support Our Freedom" beneath the image. The back of the checks display the amount $100 in all four corners and the U.S. Capitol in the center. An image of an eagle in front of an American flag is on either side of the back …