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SECU tax prep services save members 86M

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RALEIGH, N.C. (4/24/12)--State Employees' CU (SECU) tax preparers have just completed the 2012 tax season, helping nearly 65,000 North Carolina taxpayers claim more than $86 million in refunds and save in excess of $8 million in preparation fees.

Through the Internal Revenue Service Volunteer Income Tax Assistance (VITA) program, SECU tax preparers filed over 57,000 member returns--a substantial increase from last year's figure of nearly 48,000.

For members whose income thresholds fall above the VITA guidelines, SECU's low-cost tax preparation services helped 7,000 tax return filers, up 30% from the nearly 5,000 served in 2011. Also, more than 26,000 credit union members took advantage of discounted TurboTax services via SECU's website. 

SECU continues to actively promote its tax preparation services and ensure that members not only avoid high fees associated with tax return preparation, but are educated on various tax credits for which they qualify. The efforts also have paid off for members, with 65,000 members claiming more than $40.7 million in tax credits in 2012, including $22.7 million in Earned Income Tax Credits and more than $12 million in Child Tax Credits.

VITA and low-cost tax prep services appointments also provide SECU staff time to assist members with budgeting and financial counseling.

"Our goal at SECU is to help members and all North Carolinians keep more money in their pockets," said Tenesha Carter, SECU's senior vice president of tax preparation services. "The dedicated efforts of credit union tax preparers are helping SECU achieve that goal, and the amount of dollars saved on tax preparation fees confirms the positive difference SECU is making in the financial well-being of our state."

SECU, based in Raleigh, N.C., has more than $23 billion in assets.

Illinois CUs realize 11M benefit in regulatory fee credits

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NAPERVILLE, Ill. (4/24/12)--Illinois state-chartered credit unions are receiving a partial credit on their April 2012 first-quarter regulatory fee invoice. This partial credit is due in part to these credit unions receiving $11 million in the aggregate as a result of legal action undertaken by the Illinois Credit Union League (ICUL) eight years ago, ICUL said.

Between an initial cash settlement of $6.2 million, the regulatory fee holidays or credits realized in four of the past 12 quarters totaling $2.7 million, and a rate reduction of $2.1 million in regulatory fees paid to the state's Department of Financial Institutions (DFI) since the settlement was reached, Illinois state-chartered credit unions to date have realized a cumulative benefit of roughly $11 million.

The latest regulatory fee credit is the result of the remaining financial year 2011 amount due to Illinois state-charters after they enjoyed a total holiday on their fourth-quarter regulatory fee that would otherwise have been paid this past January to the Illinois DFI. The credit exceeded the total fourth-quarter billing to credit unions for regulatory fees, which meant state-chartered credit unions were entitled to, and received, a carry-forward credit applied toward first quarter fees, for a grand total of $1.25 million in the aggregate.

These credits continue to occur because of legislation initiated by ICUL to implement the court-approved settlement of the regulatory fee case it filed against then Gov. Rod Blagojevich in 2004, which was signed into law by Gov. Patrick Quinn effective April 6, 2009 (as Public Act 95-1047). Under the terms of the settlement, Illinois state-chartered credit unions received a cash payment from the state in June  2009--the aggregate amount paid to credit unions was about $6.2 million.

The payment represented a credit for the overpayment in regulatory fees made under the Blagojevich Administration's fee escalation and transfer ("sweep") budgetary arrangement adopted by the state in its fiscal years 2004 through 2006.

The 2009 legislation implementing the settlement also accomplished two other goals, according to Stephen Olson, ICUL executive vice president and general counsel. First, it codified a rate reduction in regulatory fees on a going forward basis commencing January 1, 2009. On a going- forward basis, the rate reduction has resulted in $700,000-plus per year during the past three years, or $2.1 million back to Illinois state-chartered credit unions since the legislation became law.

Second, the 2009 legislation reduced the Credit Union Fund margin that triggers a credit back to Illinois state-chartered credit unions. Olson noted the Credit Union Fund is the dedicated fund into which regulatory fees are deposited to offset the ordinary administrative and operational expenses of the DFI Credit Union Section in supervising state-chartered credit unions. It is structured as an operating account, not a savings account.

To ensure adherence to that objective, the legislation reduced the margin level to 25% from 50%.

When the balance in the Credit Union Fund at the end of a state fiscal year exceeds 25% of the expenses incurred by the state in administering the Illinois Credit Union Act and related laws, the excess must be credited to the credit unions that paid the fees in the first instance, Olson explained.

As a result of the legislation, Illinois state-chartered credit unions received an aggregate financial year 2010 margin credit of $1.45 million, which equaled a full  fourth-quarter fee holiday for 2010, as well as a partial holiday on their 2011 first quarter fees paid to the regulatory agency in April 2011. That was in addition to the aforementioned financial year 2011 fee holiday and partial credit for fourth-quarter  2011 and first quarter 2012, respectively.

"We are particularly pleased that the prosecution and favorable settlement of the regulatory fee case continues to provide direct financial remuneration to our 285 Illinois state-chartered credit unions," Olson said.

"The latest credit shows that the settlement terms we negotiated with the State in 2008 remain beneficial for our credit unions," said Dan Plauda, ICUL president/CEO. "Certainly, it comes at a good time given the continuing difficult economic and regulatory environment."

Temkin Group CUs good will makes members forgive mistakes

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WABAN, Mass. (4/24/12)--U.S. credit unions have accumulated good will with consumers because they are steadfastly working on members' behalf. This has resulted in consumers being more willing to forgive credit unions when they make an honest mistake when compared with banks, according to the most recent Temkin Group Report.

Temkin Group, a customer experience research and consulting firm, announced the release of its 2012 Temkin Forgiveness Ratings that rates how likely consumers are to forgive 206 large companies across 18 industries if they deliver a service miscue (PR Newswire April 17).

This is the second year that Temkin Group has published these ratings. The research, which is based on a survey of 10,000 U.S. consumers in January 2012, shows that consumers are most likely to forgive USAA, credit unions, H.E.B., Hy-Vee, Dollar Rent A Car, Chick-fil-A, Publix, Costco, and Amazon.com.

At the other end of the spectrum, consumers were least likely to forgive Citigroup, Charter Communications, HSBC, Chrysler dealers, EarthLink, Bank of America, Comcast, Quest and US Airways.

"Forgiveness is a valuable asset that you earn by consistently meeting customers' needs, but many companies don't have enough forgiveness stored-up to recover from their miscues," said Bruce Temkin, author of the research and managing partner of Temkin Group.

The 2012 Temkin Forgiveness Ratings cover 18 industries: Airlines, appliance makers, auto dealers, financial institutions (banks and credit unions), car rental agencies, computer makers, credit card issuers, fast food chains, grocery chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, parcel delivery services, retailers, TV service providers and wireless carriers.

Temkin Group examined industry averages and found that grocery chains have earned the most forgiveness from consumers, followed by retailers, appliance makers and parcel delivery services. However, consumers are not very likely to forgive mistakes by credit card issuers, Internet service providers and TV service providers.

The research also examined how individual companies are rated, relative to their industry peers. USAA holds the top two spots, outpacing its credit card and banking peers by more than 30 percentage points in the Temkin Forgiveness Ratings. USAA also outpaces the insurance industry by more than 20 percentage points.

Credit unions, Hyatt, US Cellular, Dollar Rent A Car, Chick-fil-A, and Bright House Networks are also more than 15 percentage points above their industry averages.

Five companies fell 15 or more percentage points below their industry's average Temkin Forgiveness Ratings: Chrysler dealers, Citigroup, Travelers, Charter Communications and RadioShack.

Temkin Group also analyzed changes in Temkin Forgiveness Ratings between 2011 and 2012. The research shows that consumers are more forgiving this year than they were last year. Led by financial institutions and insurance carriers, all 12 industries that were in both the 2011 and 2012 Temkin Forgiveness Ratings showed improvement.

Sixty-eight of the 139 companies that were in the 2011 and 2012 Temkin Forgiveness Ratings earned double-digit improvements, and four companies improved by more than 25 percentage points: credit unions, TD Ameritrade, Lenovo and USAA.

Ten companies lost ground during the past year, with the biggest declines coming for Citigroup, Continental Airlines, Travelers, Sears, Holiday Inn Express and The Hartford.

Excellence Award winners honored at HRTD Council Conference

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MADISON, Wis. (4/24/12)--The CUNA HR/TD Council Excellence Award winners were announced during the council's 18th annual conference, which took place April 18-21 in San Antonio.

The award recognizes and honors credit unions that exemplify excellence in the human resources and training disciplines and serves to promote credit union philosophies through people leadership.

This year's winners are (by category):

  • Employee engagement (less than $499 million assets): Montana CU Network in Helena, Mont., for its "Healthy You" Wellness Program. Implemented in 2009, the Montana CU League Group Benefit Trust now provides health insurance to 27 credit union organizations across Montana. The wellness program has helped reduce claims and slow the rising costs of healthcare.
  • Employee engagement ($500 million to $ 1 billion assets): Red Canoe CU in Longview, Wash., for its "Employee Engagement" Program, which used a creative approach to rewarding and incenting staff through specialized training, internal promotions and celebrations.
  • Employee engagement (more than $1 billion assets): Sandia Laboratory FCU in Albuquerque, N.M., for its "Management Bytes" Program, a newsletter for management staff that covers topics such as salary, employment interviewing, sexual harassment and dealing with employee performance issues.
  • Employee engagement (more than $1 billion assets): Mountain America CU in West Jordan, Utah, for its "8 Pillars Personal Finance" Program, which fostered employees' confidence in their ability to handle personal financial matters.  This confidence created a positive impact on how they serve and advise members who come to them for financial assistance.
  • HR/TD Management Practices (more than $1 billion assets ): Mountain America CU in West Jordan, Utah, for their "Online Branch Member Training Tutorials," which provided training for members and employees concerning their new online banking system. These tools will remain a resource for employees as they teach both new and existing members about its online branch.
  • HR/TD Strategic Leadership (less than $499 million assets ): Montana CU Network in Helena, Mont. for its "Smart Moves" program. The program, which is offered to credit union organizations in Montana, breaks down typical educational barriers by providing regional, low cost training that minimizes volunteers' time commitments, while maximizing the benefit of the time they spend on credit union business.
  • HR/TD Strategic Leadership (more than $1 billion assets): Patelco CU in Pleasanton, Calif., for its "Change Management Initiative--Corporate Relocation from San Francisco to the Burbs." In addition to starting a cross functional employee team to help communicate the vision and need for change to staff, Patelco also developed a microsite as a resource for employees to learn about the new area.
  • HR/TD Strategic Leadership (assets More than $1 billion): UW CU in Madison, Wis. for its "Far From Average--UW Credit Union's Extreme Lending Initiative." Using the approach of increasing the focus on the skills, programs and infrastructure needed to become experts at inviting members' loan business, UW CU was able to achieve a 5.50% increase in loan growth with existing staff and resources.

CU survey Youth showing financial maturity

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MANSFIELD, Texas (4/24/12)--More than half of all North Texas teens and young adults say they have some form of relationship with a financial institution, in a survey conducted by Texas Trust CU. Seven out of 10 survey respondents have a checking account, and nearly the same number have a savings account. In about half the cases, these accounts are held in the youth's name.

More than 72% of the people surveyed say they use a debit card as their primary means of accessing their funds. Only 16% replied that they rely on their parents for money. Separately, 38% report they have their own credit card. Fifty-nine percent have no credit card, while only a small percentage use a credit card in their parents' name.

Most teens surveyed did not regularly balance their checkbooks. About 34% surveyed took the view that  balancing your checkbook "doesn't matter as long as you don't overdraw or exceed your charge limit." About 33% replied that they reconcile once a month,  and 3% balance their accounts once a year.

When it comes to learning about personal finances and budgeting, parents are a young person's primary teacher. About 74% of those surveyed said their parents taught them how to budget, while only 11% said they have no budget at all.

"This survey confirmed what we suspected, which is a high level of financial maturity among young people," said Amber Danford, Texas Trust vice president of marketing. "Young people are clearly more independent today and many are opening their own accounts without anyone co-signing for them. They also have access to a greater number of financial products and services geared to them, and exercise a fair amount of control over their own money, making it easier for them to participate in commerce."

How one CU branch manager started a coop in Nigeria

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SANTA ROSA, Calif. (4/24/12)--During a visit to his native Nigeria to pay his final respects to his mother in 2010  Amy O. Ahanotu, branch manager at Redwood CU, Santa Rosa, Calif., helped bring life to a new financial cooperative.

Click to view larger image During a 2010 visit to his native Nigeria, Amy O. Ahanotu, branch manager at Redwood CU, Santa Rosa, Calif., helped start a financial cooperative. Ahanotu, at right, in red hat, teaches Nigerian children about making smart choices with money.
During his visit, women who were aware of Ahanotu's financial services background came to him with stories about the troubles they were having building up their farms and businesses because banks would not lend to them.

"I realized that, instead of just giving them money, I could teach them to help themselves by forming a lending cooperative," Ahanotu wrote in a recent letter that was published in the Napa Valley Register, Marin Independent Journal and the Ukiah Daily Journal. "Similar to the credit union model I know so well, the members of this new cooperative borrow money from a central pool of funds to purchase seed for the upcoming season or provisions for their stores.  Once the harvest has come in or the goods have been sold, they return the money for another member to use. "

Ahanotu worked with members to develop a business plan and discuss ideas for how to put profits back into the business to help the cooperative grow. He also invested $300 of his own money into the project.   When he returned home, he kept in contact with members and maintained his advisory role.

"I returned one year later and saw how well the cooperative was progressing," he wrote in his letter.  "The women had seen a productive harvest, sold their farm products at profit, and had money saved for the next planting season.  The loans had a zero percent default rate, partly because of the social stigma attached to defaulting in the village."

Click to view larger image Redwood CU branch manager Amy Ahanotu (back row, center) makes financial learning fun for children from his home village in Nigeria. (Photos provided by Redwood CU)
Ahanotu describes the cooperative as a work in progress. He has invested additional funds to help the cooperative reach its goals and solidify its foundation.  " My goal is to help them become a respected institution in the village, so that those in neighboring areas will see the results and realize they can do this, too," he said.

Ahanotu said his mentor role would work just as well in the U.S.

"Local business people and community leaders have a great deal to offer the workforce in terms of experience and advice," Ahanotu wrote in his letter . "We should think of ourselves as valuable local resources who can, with a small commitment of time, contribute to the increased economic prosperity of the region.  Whether you decide to mentor someone just starting out or volunteer to teach youth the skills they need to be successful, each effort will build on the next and improve our area's future."

West Va. CU league elects officers presents awards

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CHARLESTON, W.Va. (4/24/12)--The West Virginia Credit Union League re-elected David Van Middlesworth as chairman of its board of directors.

Van Middlesworth is a director of Eastern Panhandle FCU in Martinsburg.

The elections were conducted following the league's 76th annual meeting, held Saturday in Charleston, W.Va.

Other officers elected included:

  • First Vice Chairman--Donna Gordon, Mercer Co. WV Teachers FCU, Bluefield;
  • Second Vice Chairman--Carol Johnson, CWV Tel FCU, Clarksburg;
  • Treasurer, Mike Tucker--WV Central CU, Parkersburg; and
  • Secretary, Lynne Teets--Whetelco FCU, Wheeling.
Also at the meeting, Harry DeVilling, Tin Mill EFCU, Weirton, received the league's highest annual recognition of a volunteer, the William Bryan Hawkins Award.

Receiving the Pacesetter Award was Shelli Roberts, Eastern Panhandle FCU. The award symbolizes excellence among paid credit union staff in West Virginia.