Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

CU System Archive

CU System

Small businesses urge passage of MBL bill

 Permanent link
MADISON, Wis. (5/1/12)--Small businesses continue to write to news outlets, urging the passage of a bill in Congress that would raise credit unions' member business lending (MBL) limit to 27.5% of assets from 12.25%.

One of the latest example of small businesses stepping up to urge passage of Senate Bill 2231, the Credit Union Member Business bill, is featured in an Iowa newspaper, The Cedar Rapids Gazette, which on Sunday published, "Credit union came through when banks wouldn't," written by Robert H. Sternowski.

Sternowski, a former engineer and manager at Rockwell Collins, retired in 2003 after 34 years and started a small business in aerospace electronics. "We were strictly a 'bootstrap' startup: zero capital, three engineers, a rented store front, and used furniture and equipment," Sternowski wrote.  The company performed electronic design and prototype work for the government/military market. It grew. It received an opportunity to manufacture what it was designing, which would mean more profits, but it could not take the effort "unless we could get a loan or line of credit to finance the work for our orders.

"I went to the local banks--and was scoffed at by all. The reasons: You don't have 100% collateral, purchase orders are meaningless, the net worth of the company is too little, you are in the high-risk government business, and you have no track record. Basically every excuse in the book was thrown at me," Sternowski wrote. "All I wanted was a 90- to 120-day note in the amount of $300,000 to finance inventory and build costs for an approved blue-chip purchase order in hand."

He turned to Collins Community CU, where he had been a member for 30 years. "They were willing to work with me, listened, offered suggestions, and finally gave me the line of credit I desperately needed to pull off the manufacturing order. We completed that order, and that was our stepping stone for further growth. We are now 25 people and going strong in a new, larger facility."

Today he receives "cold calls from many of the local banks offering the moon in loans and services. They, of course, ask who our bank is, and when I tell them, they denigrate credit unions. I politely answer: I'm sorry, You made your own bed, now sleep in it. I already have a really good financial partner, and no one can prove to me otherwise."

Sternowski's op-ed piece was so powerful that he received an e-mail from another small business owner who read it, said the Iowa Credit Union League. The e-mailer said he too had been bounced around by the banks and that the next time he needs a loan, he'll go to a credit union.

Iowa newspapers have featured 11 op-eds, letters to the editors, and articles about the MBL issue since March 31, said the league. Many were from small businesses like Sternowski's supporting credit unions because of similar stories.

Illinois league awards announced (04/30/2012)

 Permanent link
NAPERVILLE, Ill. (5/1/12)--The Illinois Credit Union League's (ICUL) 82nd Annual Convention provided a forum for recognizing several credit unions and individuals.

They included:

Desjardins Financial Education Awards. Scott CU, Collinsville, in both the youth and new adult categories, for credit unions with more than $500 million in assets.

Dora Maxwell Social Responsibility Community Service Awards.  First-place winners were:

  • Streator (Ill.) Onized CU, $100 million to $200 million in assets. The credit union also placed second in the national competition.
  • GCS FCU, Granite City, $200 million to $500 million;
  • Scott CU, Collinsville, more than $500 million.
Illinois Hall of Fame Inductee. Jack Teausant, CEO of Financial Plus CU, Ottawa.

Illinois Credit Union Foundation Commemorative Awards. Donald Edwards, ICUL senior vice president, federal governmental affairs, was honored with a tribute award. Also, a repeat memorial scholarship in memory of George G. Burnett was recognized. The award was made possible with a gift from 1st Mid America CU, Bethalto.

Louise Herring Philosophy in Action Award. Only credit unions in the more than $250 million to $1 billion assets category competed this year. The first-place winner was Scott CU, Collinsville.

Also acknowledged were the many individuals, credit unions and chapters who contributed more than $364,000 to the Credit Union Political Action Council and who assisted the Illinois Credit Union Foundation in providing nearly $129,000 in grants and scholarships in 2011.

With a sports theme of "Get in the Game!" the ICUL Annual Convention saw more than 650 executives representing 120 credit unions attending.

Wash. DFI names Lacy-Roberts as CU division program manager

 Permanent link
OLYMPIA, Wash. (5/1/12)--The Washington State Division of Credit Unions has promoted Doug Lacy-Roberts to program manager, effective today.

Lacy-Roberts, who has been with the division for 12 years, will succeed Mike Delimont, who is retiring, said the Northwest Credit Union Association (NWCUA) (Anthem April 24).

Previously, Lacy-Roberts supervised six examiners and was instrumental in the division's examination and supervision program. He also worked for seven years as a credit specialist for the Federal Deposit Insurance Corp. during the savings and loan crisis in the late 1980s and early 1990s.

The division is within the Washington Department of Financial Institutions and is directed by Linda Jekel, who said that Lacy-Roberts "has a reputation of being fair with credit unions and is a great resource for examiners."

First Carolina Corporate reports strong financials

 Permanent link
GREENSBORO, N.C. (5/1/12)--First Carolina Corporate CU in Greensboro, N.C., reported 2011 earnings of $5.2 million--more than twice its original budget projections.

Retained earnings were $8.4 million, for a ratio of 0.53%, which surpassed the National Credit Union Administration's (NCUA) October 2013 required threshold of 0.45%.

First Carolina also exceeded NCUA's requirement of total capital--4% by October 2011--at 5.20% at year-end 2011, based on 12-month rolling average assets. Calculated on December 2011's average assets alone, the ratio is 6.10%.

Year-end assets were $1.45 billion, compared with $1.918 billion in 2010. The drop was intentional, based on its capital restoration plan, said the corporate.

"Our strategy called for moving a portion of members' deposits off balance sheet, allowing us to maintain average assets at a target managed level of $1.5 billion," said David Brehmer, president/CEO of the corporate. "The off-balance-sheet funds are completely liquid and accessible on a daily basis, earning the same rate as if they were to stay on our balance sheet. Taken together, members' on- and off-balance-sheet deposits were flat in 2011."

Other initiatives in 2011 included First Carolina's new Private Label Student Loan Solution, provided through an exclusive arrangement with Campus Door, said Brehmer. The program gives credit unions an affordable, customizable way to help their members pay costs of higher education, said the corporate.

First Carolina focused on new product development and transitioning services from U.S. Central Bridge FCU to other platforms. First Carolina, which had previously planned to eliminate operational dependencies on U.S. Central, has nearly completed the process.

The corporate will hold its annual meeting in Pinehurst, N.C., in June, where it will elect board members and committee chairpersons.

CUs can tap into social media mobile access

 Permanent link
MADISON, Wis. (5/1/12)--Two recent reports by Corporate Insight and Infosys indicate the importance of social media and mobile banking, respectively, to financial services companies, including credit unions.  

: Posting photos from company-sponsored events;

5. Corporate Mascots: Using pin boards to highlight a mascot's proprietary imagery;  

6. Contests: Holding contest to monitor public sentiment; and  

7. Charitable Giving: Chronicling  philanthropy to accentuate a company's charitable initiatives.

Concerning mobile banking, an Infosys study released Thursday found 94% of survey respondents said conducting financial services operations on their mobile phone is easy (PRNewsWire April 26). 

Also, 77% think conducting financial transactions of mobile phone is more convenient than traditional forms of banking However, only 42% surveyed said mobile banking is reliable.

Other findings of the Infosys survey indicate:

  • Nearly half (45%) of consumers who do not use online banking believe that mobile banking is "experimental" or "dangerous," and more than a third (38%) say it is "scary."
  • While 60% of consumers who do not use mobile banking cite a lack of confidence in the protection of their personal or financial data as a top concern, nearly the same percentage  (55%) share private information when updating their Facebook status on smart phones.
  • Nearly 80% of all consumers like the mobile banking benefit of 24-hour access to their account, 48% are happy with the speed of service, and 46% are satisfied with ease of log in.
  • Reviewing data and balancing checking accounts are the most useful features of mobile banking (both cited by 71% of consumers), followed closely by having account accuracy with the same information from Web to mobile device (69%).
  • About 42% of consumers cite the ability to communicate with customer service as a useful benefit of mobile banking.
To read the reports, use the links.

Budet elected by acclamation to CUNA Board

 Permanent link
MADISON, Wis., and WASHINGTON (5/1/12)--Tony C. Budet, president of University FCU, Austin, Texas, has been elected by acclamation to the open Credit Union National Association (CUNA) Board seat in District 5, Class 5, CUNA announced Monday.

The seat was vacated when Harriet May, former CUNA Board chairman and former CEO of GECU, El Paso, Texas, announced her retirement.

Budet will begin his term immediately and will serve through the 2014 Annual General Meeting. District 5 is comprised of leagues in Arizona, Colorado, Kansas, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah and Wyoming.

Global womens forum announces keynoters

 Permanent link
MADISON, Wis. (5/1/12)--The Global Women's Leadership Forum in Gdańsk, Poland, will convene on July 15 in conjunction with the World Credit Union Conference to address issues facing credit unions today, including finding ways to better differentiate credit unions from their competition and providing a greater understanding of international credit union development work.

Click to view larger image The Global Women's Leadership Forum will meet during the World Credit Union Conference in Gdańsk, Poland . Attendees gathered in Glasgow, Scotland last summer for the 2011 Global Women's Leadership Forum. (Photo provided by World Council of Credit Unions)
During the forum, participants will meet with branding expert Jiao Zhang, a partner with Attune LLC, a marketing research and strategy firm that focuses on return on investment; and international development professional Gabriela Zapata, consultant for the Consultative Group to Assist the Poor.

Zhang will explore how credit unions can do a better job with brand differentiation, while Zapata will provide an inside glimpse into international development and women's issues, specifically why the role of credit unions is crucial to both developed and developing countries.

Despite operating in different environments, women in the network face similar leadership challenges at their credit unions and together find insight and strategic solutions.

Prior to the event, on July 14 the Worldwide Foundation for Credit Unions will host a charity golf tournament benefiting the Global Women's Leadership Network at the Sierra Golf Club in Petkowice, Poland, hosted by presenting sponsor CO-OP Financial Services.

The Global Women's Leadership Network, co-founded by World Council of Credit Unions and the Canadian Co-operative Association, provides women the opportunity and resources to make a measureable difference in each other's lives, and in their credit unions and communities. The international network engages members with professional and personal development through social media and educational forums, and provides the tools for women to connect and seek confidential advice from their peers.

CU System briefs (04/30/2012)

 Permanent link
  • COLUMBIA, S.C. (5/1/12)--Ernest "Dizzy" Felkel of Hartsville, S.C., was named South Carolina Palmetto Protégé April 20 by the South Carolina Credit Union League.  Felkel will serve one year as statewide spokesperson for young adults and the opportunities credit unions provide them. Felkel, marketing and member education coordinator at SPC CU, Hartsville, will use social media and appearances at credit union events including chapter meetings and the fall league Leadership Conference to tout credit unions. He also will establish and lead a Young Professional Initiative group to foster peer development and the ongoing Palmetto Protégé Competition.  Other finalists for protégé were Patty Bivens, marketing manager, CPM FCU, North Charleston; Katie Matthews, member service representative, Secured Advantage FCU, Simpsonville; and Jay Montgomery, branch manager, SAFE FCU, Sumter …
  • FAIRBORN, Ohio (5/1/12)--Fairborn, Ohio-based Wright-Patt  CU (WPCU) has received approval from the state to expand its field of membership to include Hamilton County as a community group.  This will enable the $2.3 billion asset credit union to serve individuals who live, work, worship, and/or attend school in the county. WPCU has two locations in the area. The expansion will allow the credit union to better serve greater Cincinnati  and "represents our commitment to our growing membership in the area," said WPCU President/CEO Douglas Fecher …
  • MIAMI, Fla. (5/1/12)--A former Miami policewoman and former president of the Miami Community Police Benevolent Association has pleaded guilty in a U.S. District Court in Miami to embezzling at least $210,664 from the association's funds by making withdrawals from the group's credit union accounts .  Vernell Reynolds, 46, who served as president of the association from 2005 to 2010, faces 12-18 months in prison; an order to repay the amount stolen; and surrender of her law enforcement license (The Miami Herald April 25) …

Minn. FIC names 22 CU recipients of scholarships

 Permanent link
ST. PAUL, Minn. (5/1/12)--The Family Involvement Council (FIC), a committee of the Minnesota Credit Union Foundation (MNCUF), awarded $12,000 in scholarships to 22 individuals for the 2012-2013 school year.

The scholarship program is the focus of FIC's mission to provide financial awareness to families and to further the education of Minnesota credit union members. Scholarship applicants submit information about their extra-curricular activities and accomplishments, and an essay on an FIC-selected topic.

Two $1,000 Harvey Bakke scholarships and 20 $500 scholarships were awarded this year to college students in traditional (high school seniors entering college) and non-traditional categories.

"We had a great response to our scholarship program this year, and the insightful responses to the essay question made it tough to choose our winners," said Bridget Moeller, FIC Chair. "The quality of applicants we have each year makes it clear that credit union members in Minnesota care about their education and the credit unions they belong to."

The winners of the $1,000 scholarships were Bobbi Seibert of Members Cooperative CU, Cloquet, in the traditional category, and Ann Anderson of Affinity Plus FCU, St. Paul, in the non-traditional category.

The winners of the $500 scholarships were:

Traditional recipients                   
  • Stephanie Besst, Electrus CU, Brooklyn Center;                                       
  • Annamarie Brennhofer, SPIRE FCU, Falcon Heights;                                          
  • Megan Hallstrom, Minnco CU, Cambridge;                                                    
  • Bethany Leraas, Central Minnesota FCU, Melrose;                               
  • Elizabeth Peterson, US FCU, Burnsville;                                                         
  • Morgan Savage, Mayo EFCU, Rochester;                                                       
  • Renee Schminkey, Greater Minnesota CU, Mora;                           
  • Kristen Springman, Affinity Plus FCU, St. Paul;
  • Skyler Vold, SouthPoint FCU, Sleepy Eye; and                                  
  • Brandon Vuong, Richfield (Minn.) Bloomington CU.         
 

Non-traditional recipients   

  • Rachel Brixius, Central Minnesota FCU, Melrose;      
  • Angela Bury, General Mills FCU, Minnetonka;  
  • Katherine Ginkel, General Mills FCU;    
  • Eric Marshall, Great River FCU;
  • Lindsay Ortlip, Hiway FCU, Saint Clound;     
  • Alex Reid, Collegeville Community CU, Saint Joseph; 
  • Elise Riveness, Hiway FCU, St. Paul;             
  • Austin Ruud, TopLine FCU, Maple Grove;   
  • William Schultze, Minnesota Valley FCU, Mankato; and
  • Stefanie Skalicky, Greater Minnesota CU.
 

In their essays, applicants answered the question, "What impact has social media had on your financial decisions and how could credit unions use these tools to help you with your financial goals?"

Funds for the FIC's scholarship program are raised each year during the committee's silent auction, which is held during the Minnesota Credit Union Network's annual meeting and convention.

March mergers continue trend

 Permanent link
WASHINGTON (5/1/12)--The National Credit Union Administration (NCUA) announced 21 mergers in March, citing six primary reasons for the consolidations.

Among the reasons cited for the mergers were expanded services, poor financial conditions, poor management, lack of sponsor support, lack of growth and loss of field of membership.

Credit Union National Association statistics show 14 mergers of affiliated credit unions took place in March, and a total of 54 mergers of affiliated credit unions had taken place year to date through March. That compares with 61 mergers of affiliated credit unions year-to-date in 2011.

NCUA approved the following mergers:

  • Anne Arundel Co. Employees CU, with $82 million assets, Millersville, Md., into $2.2 billion State Employees CU of Maryland, Linthicum, Md.
  • Sparks (Nev.) City Employees FCU, with $13 million assets, into $103 million asset Great Basin FCU, Reno, Nev.
  • Filene FCU,  with $19 million assets, Boston, into $621 million Webster First FCU, Worcester, Mass.
  • Connecticut Energy Employees FCU, with $3 million assets, Bridgeport, Conn., into $234 million asset Mutual Security FCU, Shelton, Conn.
  • Valleystone CU, with $65 million in assets, Willbraham, Mass., into $412 million asset Polish National CU, Chicopee, Mass.
  • Dixiecon FCU, with $227,000 in assets, Richmond, Va., into $28 million asset Hopewell (Va.) Chemical FCU.


  • McKinley Memorial FCU with $79 million in assets, Willow Grove, Pa., into $532 million asset Freedom CU, Warminster, Pa.
  • St. Agnes Hospital FCU, with $4 million in assets, Fresno, Calif., into $1.9 billion asset Educational Employees CU, also of Fresno.
  • Intext Employees FCU, with $1 million assets, Scranton, Pa., into $165 million asset NET FCU, also of Scranton.
  • Kingdom FCU, with $415,000 in assets, Norfolk, Va., into $375 million asset ABNB, Chesapeake, Va.
  • East Bay Postal FCU, with $8 million assets, Oakland, Calif., into $187 million asset Pacific Postal CU, San Jose, Calif.
 

  • Wilberforce University FCU, with $148,000 in assets, into $84 million asset Heartland FCU, Dayton, Ohio.
  • West Ohio United Methodist Conference CU, with $20 million in assets, Cincinnati, into $56 million asset, East Ohio Methodist CU, North Canton, Ohio.
  • Area West FCU, with $273,000 in assets, Houston, into $39 million Transtar FCU, also of Houston
  • HHA FCU, with $929,000 in assets, Houston, into $33 million $33 million asset Space City CU, also, of Houston.
  • Ely (Minn.) Steel workers CU, with $799,000 in assets, into $31 million asset Northridge Community CU, Hoyt Lakes, Minn.


  • Bilt-Well CU, with $922,000 in assets, Dubuque, Iowa, into $28 million asset Holy Ghost Parish CU, also of Dubuque.
  • Hometown CU, with $7 million in assets, Quincy, Ill., into $51 million asset United Community CU, also of Quincy.
  • Madison V.A. Employees' CU with $2 million in assets, Madison, Wis., into $120 million asset Dane County CU, also of Madison.
  • Tower CU, with $45 million in assets, Wausau, Wis., into $356 million asset Connexus CU, also of Wausau.
  • Metro CU with $30 million in assets, Superior, Wis., into $77 million asset Hermantown (Minn.) FCU.

Two elected to South Carolina CU League board

 Permanent link
COLUMBIA, S.C. (4/30/12)--South Carolina credit unions elected one new director and re-elected another to the South Carolina Credit Union League (SCCUL) Board of Directors, and both will serve full three-year terms.

Election results were announced at the April 21 business session of the SCCUL & Affiliates 2012 Annual Meeting in Myrtle Beach, S.C.

New to the 2012-2013 SCCUL Board of Directors is Nick Wodogaza, president/CEO of Palmetto Citizens FCU, Columbia. Re-elected is Faye Crocker, CEO of Greater Abbeville (S.C.) FCU.

Continuing their multi-year terms in 2012-2013 are: Rick Hammond, president/CEO of S.C. State FCU, Columbia; Robert Harris, CEO of Health Facilities FCU, Florence; W. Ray Partain, board member for Anderson (S.C.) FCU; Anne Shivers, president/CEO of Carolina Collegiate FCU, Columbia; and Linda Weatherford, vice president at SPC CU, Hartsville.

Following the business session, the board named its officers: Crocker, chairman; Shivers, vice chairman; Partain, treasurer; and Harris, secretary.

As immediate past chairman, Weatherford will serve one more term as a board member before acting as an ex officio member. Scott Woods, president/CEO of SC FCU, North Charleston, remains as an ex officio member of the board, as is SCCUL President/CEO Steve Fowler.

Of the 73 member credit unions eligible to vote for the new directors, 59 completed required voting credentials. Of those, 57 submitted ballots to independent accounting firm Cantey, Tiller, Pierce, & Green, LLP of Camden, S.C.

40 CU professionals become CU Dev. Educators

 Permanent link
MADISON, Wis. (4/30/12)--Forty credit union professionals were guided by eight program facilitators and mentors through the week-long Credit Union Development Education (DE) Training. The April 18-25 training was held on the University of Wisconsin campus in Madison, Wis., said the National Credit Union Foundation (NCUF).

During the week-long program, participants were involved in group exercises, field trips, encouraged to ask questions of visiting speakers, and completed team projects proposing solutions for credit unions to help alleviate or eliminate challenging situations in any given area.

"DE Training provides critical lessons in cooperative principles and credit union philosophy while incorporating challenges credit unions face today," said Lois Kitsch, DE facilitator and national program director for NCUF. "It is timeliness that we strive for in the entire DE training experience as participants work through critical issues that include member business lending, mergers and small credit unions, bank conversion, serving emerging markets, national branding, and credit union development in Haiti."

"This was an eye-opening experience that allowed me to separate myself from my daily routine and take a macro view of our movement," said Tony Emerson, class attendee and president/ CEO of The Credit Union League of Connecticut. "As a league president, I found it especially motivating to see the passion and dedication others have for seeing our industry survive and be there for our members. It should be everyone's goal to attain this designation."

The 2012 graduating class included credit union movement representatives from across the U.S. and one from Kenya participating through the African DE Scholars Program.

"Industry trainings and conferences remind you that you are a part of something bigger than yourself and your credit union, but DE Training goes a step beyond," said Lisa Totaro, marketing associate at Sunmark FCU in Latham, N.Y. "DE reminds us that we are part of a worldwide cooperative movement united by deep philosophical principles, and helps cement what sets us apart. It reminds us what 'people helping people' is really about."

"The Poverty Simulation (or Life Simulation) on its own, is worth the price of attendance," said Jeff Kunberger, service center manager at Suncoast Schools FCU location. "Being able to put yourself in your member's shoes as they live week to week and day to day, and the frustration of all the obstacles placed in front of them opens your eyes to all the potential products, services and solutions we as a credit union can offer to improve the quality of our member's lives."

The next DE Training will be held at the Lowell Center in Madison, Wis., Sept. 6-13. Registration is still open and can be found at the NCUF website. Use the link.

To see a list of the new 40 Credit Union Development Educators, use the link.

Federation highlights CU difference at NYC Green Festival

 Permanent link
NEW YORK (4/30/12)--The National Federation of Community Development Credit Unions and several of its member credit unions highlighted their advantages for individuals looking for affordable financial services and access to credit, during New York City's Green Festival held at the New York City's Javits Convention Center earlier this month.

The event also showcased the economic benefit of financial cooperatives to the communities they serve.

Several New York City-based member credit unions participated, including Bethex FCU, the Lower East Side People's FCU, Union Settlement FCU and United Nations FCU. The federation's table was located near the front of the 20,000 square-foot convention room.

The event--with more than 25,000 visitors attending--afforded the federation and its member credit unions (CDCUs) the opportunity to discuss the benefits of community-based financial cooperatives regarding the advantages available to individuals looking for affordable financial services and access to credit.

The federation's credit union volunteers were among the few exhibitors discussing alternative banking and responsible financial services. They answered questions from interested consumers looking to learn more about the differences between credit unions and banks, the types of products offered at credit unions, where to find their local credit union and how to join.

"It was great to have our volunteers come out and represent UNFCU at this event to discuss our greening initiatives, as well as to support the federation in this UN-declared International Year of Cooperatives," said Pamela Agnone, senior vice president of retail services at United Nations FCU. "There was just so much positive energy filling the exhibit hall, with each organization working to do their part for their communities and the environment."

"This was an extremely successful event," said federation program associate Elizabeth Friedrich, who coordinated the credit union volunteers participating at the festival. "There was a lot of interest in the work that credit unions are doing. We spoke with literally hundreds of attendees about the benefits of banking local through credit unions and handed out nearly all the informational materials we brought with us. Hopefully our member CDCUs will have lots of new members knocking on their doors as a result of our efforts."

The Green Festival--one of the premier sustainability events in the U.S.--hosted more than 100 authors, leaders and educators, including Russell Simmons and Amy Goodman; how-to workshops; cutting-edge films; fun activities for children; organic beer and wine; vegetarian cuisine; and live music.

MCUA adds CUDE expertise

 Permanent link
ST. LOUIS (4/30/12)--The Missouri Credit Union Association (MCUA) has expanded its team of Credit Union Development Educators (CUDEs). Three MCUA staff members earned their CUDE designation last week, bringing MCUA's staff total to 13 CUDEs.

Kevin Brueseke, chief financial officer; Don Cohenour, chief membership officer and Mark Hohenstein, shared branching vice president, joined 37 credit union professionals from across the world for the Spring program in Madison, WI.

After completing development educator school in 2005, Kevin Shaw, MCUA  Office of Small Credit Unions director, returned to the program to serve as a group mentor.   

"MCUA is the most invested league in the country, and perhaps organization, in the country in our credit union movements premier philosophy training program and boot camp," said Mike Beall, president/CEO. "At MCUA, we believe that our commitment to our credit unions, and to the philosophy of our movement is made stronger by the CUDE designations earned by these professionals."

MCUA's commitment to the CUDE philosophy extends beyond internal staff to outside counsel and business partners including legal, strategic, corporate, foundation and website consultants. 

"Each of these folks adds to the value of what MCUA brings to the table in our work with and on behalf of credit unions," said Beall.

Minn. CU4Kids committee members recognized

 Permanent link
BLOOMINGTON, Minn. (4/30/12)--The Minnesota Credit Unions for Kids (MnCU4Kids) committee and the Minnesota Family Involvement Council (FIC), committees of the MNCU Foundation, recently honored two members for their contributions.

Roxi Jensen (right) assistant manager of Embarrass (Minn.) Vermillion CU, was recognized as the Minnesota Credit Union for Kids Volunteer of the Year at an awards banquet held in conjunction with the Minnesota Credit Union Network's (MnCUN's) 2012 Annual Meeting & Convention. Jensen is pictured with Mark Cummins, president/CEO of the Minnesota Credit Union Network.
Roxi Jensen of Embarrass (Minn.) Vermillion CU and Bridget Moeller of Greater Minnesota CU received their volunteer awards on April 14 during an awards banquet held in conjunction with the Minnesota Credit Union Network's (MnCUN's) 2012 Annual Meeting & Convention.

Jensen, assistant manager of Embarrass Vermillion FCU, was recognized for her contributions to MnCU4Kids with its Volunteer of the Year Award. She became a committee member in 2006. She has been actively involved in serving on subcommittees for the Credit Union for Kids golf tournament, annual meeting fundraiser and the Bowl-O-Rama event.

"I'm honored to be recognized for this award, and I'm happy to serve on a committee that raises money for such a worthwhile cause," Jensen said. "With our fundraisers and other activities, we can directly help the kids and families who need it at Gillette. It's fulfilling work, and I'm proud to be a volunteer for this committee."

Bridget Moeller, right, vice president of human resources and training at Greater Minnesota CU, Mora, Minn., was honored for the second time as the Minnesota Family Involvement Council Outstanding Volunteer. Moeller is pictured with Mark Cummins, president/CEO of the Minnesota Credit Union Network. (Photos provided by the Minnesota Credit Union Network)
Last year, Minnesota raised nearly $160,000 for Gillette Children's Specialty Healthcare in St. Paul, which has outreach clinics statewide. Nationally, fundraising for CU4Kids takes place in all 50 states.

Moeller, vice president of human resources and training at Greater Minnesota CU in Mora, earned the Minnesota Family Involvement Council's Outstanding Volunteer Award for her service on the committee. Moeller joined the FIC in 2005 and was elected to serve as the chair of the committee in 2011.

Before serving Chair, Moeller served as the FIC's vice chair since 2007. She plays an integral role in coordinating the committee's annual silent auction fundraiser, and she is involved in the committee's scholarship program. This is the second consecutive year she has received the award.

The FIC is a volunteer-based organization run by credit union professionals. Its mission is to enhance the future of the credit union movement by providing financial awareness to families. The FIC focuses on providing scholarships to Minnesota credit union members to help further their education and to nurture their relationship with credit unions. The recipient of the annual award is voted on by members of the council.

"The FIC is an incredible group of people," Moeller said. "I know there are many people on this committee who work very hard and are quite deserving of this award, and it is a great honor to be recognized by them again. The committee's dedication to our scholarship program and their commitment to financial education are notable contributions to Minnesota's credit unions. It's a great feeling to be part of this team."

"It's the dedication of people like Roxi and Bridget and their significant contributions to credit unions that help strengthen the movement," said Rachel Anderson, MnCUN director of communications and MnCU4Kids and FIC liaison. "They truly believe in their respective causes, and the accolades they received are well-deserved."

Illinois league seats new board officials elected

 Permanent link
NAPERVILLE, Ill. (4/30/12)--Many elections by the Illinois Credit Union League (ICUL) and affiliated organizations have taken place at ICUL's 82nd Annual Convention, including the seating of ICUL's new 12-member board of directors.

The change in the size of the ICUL board was as a result of a bylaw amendment passed by the delegates in 2009 to address corporate governance of the league, through a reduction in the current size of its board to 12 directors, effective Jan.1. The bylaw amendment also redefined the league board by three multi-chapter regions (districts) of four directors each based on member size: less than 3,000 members (Class A), 3,000 to 9,999 (Class B), 10,000 or more (Class C) and At Large (Class D).

New Illinois Credit Union League Board chairman Geri Burek, took her oath of office with outgoing Chairman Dennis Hall, CEO, IH Mississippi Valley CU, at ICUL's 82nd Annual Convention held last week. (Photo provided by the Illinois Credit Union League)
Geraldine Burek, CEO of South Division CU, Evergreen Park, was elected chairman. Burek will serve on the league board as the Class B director for District 2 and has been an ICUL director since 2003. During that time, she has also been chairman of the annual convention and legislative committees, served on the executive committee, and on the CUPAC board for 21 years. In addition, she began serving on the ICU Foundation board in 2009. Burek also willserve as ICUL Service Corporation (LSC) chairman.

Pete Paulson, CEO, Corporate America Family CU, Elgin, was elected vice chairman. Paulson, from the Fox Valley Chapter, will serve as the Class D At Large director for District 3 and has been on the League board since 2003. During that time, Paulson has also participated on the annual convention and executive committees. He also was on the LSC board for four years.  Paulson will serve as LSC vice chairman.

Peggy Cummins, CEO, Three Rivers Community CU, Mt. Carmel, was elected secretary/treasurer. Cummins, from the Southern Illinois Chapter, will serve as the Class A director for District 1. She has been on the league board since 1996 and during that time has also served on the annual convention, credit union support group, executive and legislative committees. In addition, she has served on the ICU Foundation board since 2001.

Election of new officers for the Illinois Credit Union (ICU) Foundation; Credit Union Political Action Council (CUPAC) and Illinois Youth Involvement Council (IYIC) also took place.

The ICU Foundation held its annual meeting and elected its officers. In addition, CUPAC elected new officers at its annual meeting held in conjunction with the convention. The IYIC re-elected its executive committee, also during the convention.

With a sports theme of "Get in the Game!" ICUL's three-day convention concluded Saturday at the Schaumburg Renaissance Convention Center. More than 650 executives representing 120 credit unions attended.

NJCUL contest winner announced helps disabled

 Permanent link
TOTOWA, N.J. (4/30/12)--North Jersey FCU, Totowa, N.J., has been named the winner of New Jersey Credit Union League's (NJCUL) "Banking You Can Trust" story contest for its happy tale of helping one member, who had been turned down again and again by banks, get the financing she needed for a wheelchair accessible van for her disabled son.

North Jersey FCU President/CEO Lourdes Cortez (left) receives a "Banking You Can Trust" certificate from New Jersey Credit Union League Marketing and Communications Coordinator Marissa Anema. (Photo provided by New Jersey Credit Union League)
NJCUL asked credit unions to share their personal stories about how they have helped members in a profound way (The Daily Exchange April 27).

As the winner of NJCUL's "Banking You Can Trust" Story Contest, North Jersey FCU receives a feature story in NJCUL's Weekly Exchange newsletter, a framed reprint of the story, a feature story in NJCUL's legislative newsletter NJ CU Digest, the story featured on the home page of the league website, the story sent to the local press, and a certificate certifying that the credit union provides "Banking You Can Trust."

Illinois league annual convention in 82nd year

 Permanent link
NAPERVILLE, Ill. (4/27/12)--More than 650 executives representing 120 credit unions have signed up to attend the Illinois Credit Union League's (ICUL) 82nd Annual Convention, which began Thursday and runs through Saturday, and features many new enhancements.

With a sports theme of "Get in the Game!" the convention will tout a new location for the event--the Renaissance Convention Center in Schaumburg, Ill., which will host more than 80 vendors.

The convention will feature the keynote and awards ceremony, in which credit unions and individuals will win accolades for their accomplishments for the past year, including one inductee into the Illinois Credit Union Hall of Fame and one recipient of the Illinois Credit Union Foundation's Tribute Award.

Winners of the Dora Maxwell, Louise Herring, and Desjardins awards competition, and supporters of the Credit Union Political Action Council, will also be recognized. Connie Payton, wife of the late football legend Walter Payton, will serve as keynote speaker and present "Family Values, Teambuilding, Embracing Life." This session will also include the changing of the gavel for ICUL's chairman of the board.

The annual convention also includes 24 educational sessions, including a pre-conference workshop on Thursday followed by the first group of sessions, which will begin Friday morning.

One session at this year's event will be Organ Donation Importance. More than 5,000 men, women and children in Illinois are on the organ transplant waiting list. Because April is "Organ Donor Awareness Month," ICUL will be offering complimentary onsite donor registration sponsored by the Illinois Secretary of State's office following Brittany Payton's break out session. One donor can save or enhance more than 25 lives. 

Other new features for this year's convention include:

  • A mobile website. It is intended to provide more information at the fingertips of attendees via their smartphones, either by scanning the convention QR Code or if a user enters the annual convention page URL directly. The mobile website features: convention highlights, schedule and speakers, a hotel floor plan/map, a comprehensive list of area restaurants and attractions, including shopping and nightlife options, and a listing of exhibiting business partners.
  • A new a special one-day registration rate.  This was initiated to give credit unions the opportunity to bring extra staff to the convention and includes admission to the keynote session, the morning and afternoon education sessions, access to the exhibit hall and a "tailgate" lunch on Friday. As of press time, 86 people from 30 credit unions have taken advantage of this new promotion and more are anticipated to register on-site.
  • Credit union "crashers."  This initiative is part of an effort to attract young professionals to this year's event, under the guise The Cooperative Trust (formerly The Crash Network), a grassroots organization comprised of hundreds of young credit union professionals. Sponsored by ICUL and CUNA Mutual Group, Crash Illinois will give young credit union professionals the opportunity to participate in the event by attending the full convention and additional mentor sessions with industry thought leaders each day and building relationships with other young credit union professionals.
  • The opportunity for Continuing Professional Education (CPE) credits. Many of ICUL's convention sessions, as well its annual schedule of more than 60 "QuickBites," telecourses, and in-person sessions, are now CPE eligible.

Credit unions press MBL case with media

 Permanent link
MADISON, Wis. (4/27/12)--As they continue to press the U.S. Congress to pass legislation to extend their members business lending (MBL) authority, credit unions are receiving positive media coverage about their efforts to help small businesses and improve the economy.

Bills in the House and Senate would increase the MBL cap to 27.5% of a credit union's assets, up from 12.25%, under certain conditions.

Within the first year of enactment, the increased MBL authority would help to inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, Credit Union National Association (CUNA) estimates show.

Patrick Keefe, CUNA vice president of communications and media, was quoted in a April 26 article in The Tennessean assessing the bills' chances in Congress.

"The game is really on in the Senate," Keefe told The Tennessean. "We feel that we have a real good case in the House. We just have to get through the Senate. I'm not saying it's adone deal in the House, but the Senate is key."

The April 26 edition of The Baltimore Sun featured an opinion editorial article written by Rod Staatz, president/CEO of SECU of Maryland.

Staatz cited a recent nationwide survey, in which 9 out of 10 small businesses indicated that availability of credit was impeding their ability to hire. Nearly two-thirds said it had become significantly harder to get loans today than just a few years ago. Similarly, a National Federation of Independent Business survey found a nearly 10% increase in the number of small businesses trying to borrow but no change in the number of small businesses actually obtaining credit.

"Business lending is consistent with the mission of credit unions," Staatz said. "Credit unions were founded to 'promote thrift and make loans for provident purposes' through a not-for-profit cooperative structure focused on member-owners, not profit margins. Meeting the credit needs of their members--including business credit--is why credit unions exist."

The San Antonio News Express published an opinion editorial from Bill Hammond, Texas Association of Business CEO, touting the willingness of credit unions to make loans to small businesses, in contrast to banks.

"A government program designed to provide loans to small businesses was only 14% loaned-out a year after its implementation. But there has been one bright spot in the tough lending picture--credit unions," Hammond wrote.

"Credit union lending to small businesses went up 44% over the last four years after small business entrepreneurs gave up on banks and looked elsewhere for loans," he continued. "The average credit union loan is almost $220,000, making credit unions the perfect partner for small businesses."

An April 8 article that appeared in in the Winston-Salem Journal  cited Credit Union National Association statistics that indicate credit unions hold less than 6% of all small-business loans, or a combined value of about $40 billion.

Credit unions would provide loans that banks have chosen not to offer, according to credit union sources quoted in the article.

"If just four credit unions in North Carolina that are at or above 65% of their member business lending cap are unable to continue lending, over 2,200 jobs and $200 million in credit will likely be lost in the next year," Marcus Schaefer, Truliant CU president/CEO tols the Winston-Salem Journal.

Jeff Hardin, communications director for the North Carolina Credit Union League, said MBL bills are not a bank-versus-credit union issue.

"Over the past several years, small-business owners have had a particularly hard time getting access to that capital, Hardin said. "Credit unions have dollars to lend and the expertise to help these small businesses."

Eli Lehrer, vice president of the Heartland Institute wrote an opinion editorial supporting MBL legislation in the Californail business and political journal Fox & Hound. "Anyone who favors a freer, less regulated economy, should take victories where they can find them,"  Lehrer wrote. "And it's why conservatives should flock to support an effort to deregulate credit union lending. It's one of the best things Congress can do to create jobs and help small business in the short term."

The Heartland Institute and 10 other free-market organizations sent a joint letter to Senate Majority Leader Harry Reid, (D-Nev.), and Senate Minority Leader Mitch McConnell, ( R-Ky.), asking that they take up legislation that would loosen regulatory constraints on the amount of loans credit unions can make to business members.

"Doing away with these regulations would inject over $13 billion into the economy and foster the creation of up to 140,000 new jobs in its first year, all at no cost to taxpayers," the groups wrote. "As the economy is struggling to kick-start, this bill would give businesses much-needed capital to expand by simply raising the arbitrarily low lending cap."

In an 18-page policy document, Katherine E. Howell-Best of the North Carolina Banking Institute examined whether credit unions could effectively serve the small business market through their member business lending products.

"Banks allege that credit unions are creeping into the banking industry's share of the business lending market.  The empirical evidence, however, does not support this allegation," Howell-Best wrote. She cited a U.S. Department of Treasury report that showed credit union member business lending almost doubled in seven years, from $2 billion in 1993 to $3.9 billion in 1999. During the same time, banks increased commercial and industrial lending by almost 85%, to to $824.7 billion in 1999 from $447.8 billion in 1993.

"Credit unions whose business lending goal is to allow members who need business lending services to make credit unions their primary financial institution should devise business lending and business services strategies," Howell-Best concluded.

"This includes offering business accounts, gaining experience that will enable the development of ancillary services, and, ultimately, mastering member business lending. Perhaps most importantly, though, credit unions must make their services and product lines known to their members in order to tap their unmet financial services needs."

The La Crosse Tribune published a letter from Brett Thompson, CEO of the Wisconsin Credit Union League, in response to a letter from the Wisconsin Bankers Association:

Thompson made the following points about MBL legislation:

  • Raising the lending cap won't increase deficits and will increase revenue.
  • Banks hold 95% of U.S. business loans; MBL legislation won't dent their market share.
  • More than 30 conservative and progressive groups support the legislation, as do 84% of voters recently polled.
  • Small businesses say there's a credit gap; research supports them.
  • The cap doesn't hamper just a few credit unions. Almost all credit unions must either deny business loans because of the cap or not offer them at all because the cap prevents cost recovery.
  • Credit unions pay all taxes except corporate income taxes.
On Bloomberg TV, Dale Kluga, head of Cobra Capital, LLC, addressed how big banks are not extending credit to small businesses. The housing market cannot make a full recovery until small businesses begin making more loans, Kluga said.

"My opinion is if the banks are not interested in supporting small businesses then they need to step aside and let the credit unions at least try," Kluga said.

Kluga suggested that small business lending is not currently a part of big banks' business model.

"Why should they preclude the credit unions from getting in the business?" Klug said.

To watch the video, use the link.

Early bird deadline looms for World CU Conference

 Permanent link
MADISON, Wis. (4/27/12)--The "early bird" deadline for World Council of Credit Unions' (WOCCU) 2012 World Credit Union Conference in Gdańsk, Poland, July 15-18 is looming. On May 10, the registration fee will increase to $200 per attendee.

Conference attendees will have the opportunity to connect with peers from around the world; hear from leading business minds Youngme Moon, Harvard University professor, and mobile banking guru Brett King, who are driving change in and outside the credit union industry; and take in sightseeing tours highlighting the historical significance of Gdańsk.

"This summer we also have the pleasure of joining Poland's credit unions, Spoldzielcze kasy oszczędnościowo-kredytowe or better known as SKOKs, in celebrating their 20th anniversary," said Brian Branch, WOCCU president/CEO. "What started as a small grassroots effort has grown to become one of the most successful and respected credit union systems in the world, and attendees will have the chance to see this amazing transformation firsthand and celebrate its success."

Also, this year's conference features local credit union visits, breakout sessions featuring field-tested solutions, The Worldwide Foundation for Credit Unions' charity golf tournament, the third annual Global Women's Leadership Forum and opportunities to network and build a strong professional network that will continue after attendees leave Gdańsk.

A companion program and sightseeing tours also are scheduled for guests to join in this year's activities, and spaces are still available on the pre-tour, July 10-14, from Kraków to Gdańsk and the post-tour, which will head to St. Petersburg, Russia, July 19-22, after the conference. Early registration is recommended.

Register on or before May 10 to take advantage of discounted registration fees. For more information about the conference and to register for the event, use the link.

PCUA meets with officials about loans for the disabled

 Permanent link
HARRISBURG, Pa. (4/27/12)--The Pennsylvania Credit Union Association (PCUA) met with state officials April 20 to discuss how credit unions can help get the word out about the availability of assistive technology loans for people with disabilities.

Jim McCormack, PCUA president/CEO, and staff members Rick Wargo and Mike Wishnow, hosted the Pennsylvania Secretary of Banking Glenn Moyer, and officials from the Department of Labor & Industry and the Pennsylvania Assistive Technology Foundation (Life is a Highway April 23).

Participating in the meeting were: Jennifer Peterson, Esq., special assistant to Labor & Industry Secretary Julia Hearthway; James Kreider, executive assistant to Stephen Suroviec, executive director of Labor & Industry's Office of Vocational Rehabilitation; Susan Tachau, executive director, Pennsylvania Assistive Technology Foundation (PATF); and Tracy Beck, operations director, PATF.

The group discussed specific financial education needs of people with disabilities, as well as a role credit unions can play in helping disabled members.

"The credit union mission of 'People Helping People' fits very nicely with PATF's goal to help disabled Pennsylvanians live independently," said Jim McCormack. "Friday's meeting was a good first step in exploring how our two organizations can work together for the betterment of Pennsylvania consumers."

Minnesota CU Network co-ops discuss collaborations

 Permanent link
BLOOMINGTON, Minn. (4/27/12)--The Minnesota Credit Union Network (MnCUN) hosted a panel of leaders discussing how credit unions can develop mutually beneficial partnerships with local cooperatives, as part of its celebration of the International Year of Cooperatives.

During the Minnesota Credit Union Network's Annual Meeting & Convention on April 13-14, cooperative leaders participated in a panel discussion on how credit unions can develop mutually beneficial relationships with area cooperatives. (Photo provided by the Minnesota Credit Union Network)
Held April 13-14 during MnCUN's Annual Meeting & Convention, the session provided credit unions tangible ideas of how they can help strengthen the cooperative movement. Facilitated by cooperative consultant Adam Schwartz, the panel of cooperative leaders shared collaboration success stories.

The panelists included Credit Union National Association (CUNA) President/CEO Bill Cheney, The Wedge General Manager Lindy Bannister, SPIRE FCU President/CEO Dan Stoltz, and Crow Wing Power CU Vice President Diane Viehauser.

Schwartz, who previously served as the National Cooperative Business Association's (NCBA's) vice president for public affairs, said it is important for credit unions to emphasize the "cooperative essence of who they are."

Understanding the importance of cooperative partnerships, Stoltz outlined his credit union's cross-promotional work with four area grocery co-ops. SPIRE FCU, based in Falcon Heights, offers a branded Visa card program to the members of grocery co-ops and shares a portion of the interchange income with the cooperative. Stoltz stated that this relationship adds value to the membership offerings of the credit union and the grocery co-ops.

One of SPIRE FCU's partners is The Wedge Community Co-op, which is the largest single-store cooperative in the country. General Manager Bannister emphasized the benefits of the co-op's relationship with SPIRE FCU. She encouraged credit unions to examine their existing products and services and look for natural ways these offerings can be used to benefit members of other local cooperatives.

"Anything we can do together--as a cross sector--is going to make us stronger together," Bannister said.

The third representative on the panel was Viehauser of Crow Wing Power CU in Brainerd who shared the story of how the credit union developed from the Crow Wing electric cooperative. Viehauser outlined the credit union's rapid growth and strong connection to the cooperative. She said community members appreciate the cooperative business model and strongly support the two organizations.

CUNA President/CEO Bill Cheney praised the panelists for their collaboration efforts and encouraged attendees to build similar relationships.

"I can't think of a better time to promote cooperatives--with this year being the International Year of Cooperatives," Cheney said. "I think it's greatly important that credit unions work together with cooperatives. The bottom line is cooperatives are a better way."

Cheney went on to outline CUNA's commitment to supporting and strengthening the cooperative movement thought involvement with the NCBA and other cooperative organizations. He also highlighted examples of cooperatives nationwide that educate consumers about the benefits of co-ops.

As the state with the most cooperatives, Minnesota is actively involved in celebrating the International Year of Cooperatives. In addition to hosting the cooperative panel at its Annual Meeting & Convention, MnCUN has coordinated media relations and consumer awareness activities to spread the message about cooperatives and the benefits they bring to communities and individuals.

UW CU set to launch student loan exit program

 Permanent link
MADISON, Wis. (4/27/12)--UW CU, Madison, Wis., is launching a new exit counseling program for its student loan borrowers.

When a student graduates with a UW CU student loan, they'll be invited to attend a free, educational seminar. The credit union will host in-person seminar sessions to students that are graduating May 2012 or this summer.

Sessions will cover topics such as UW Credit Union Loan information, including estimated payments, repayment options and whom to contact with questions. Also, federal financial aid information, budgeting after college and the ways student loans can affect personal credit history will be discussed.

"Providing financial education is a core business value for our organization," said Mike Long, UW CU executive vice president and chief credit officer. "Our commitment to student success continues well beyond the initial loan transaction. Our intent is to make our program very accessible, so graduates will take advantage of the seminar to get the information and skills they need to make good financial choices."

For this pilot counseling program, in-person sessions are being offered on six campuses--UW-Madison, UW-Milwaukee, UW-Stevens Point, UW-Whitewater, UW Oshkosh and UW-Green Bay. The credit union provides student loans for students attending any UW System school, Madison College or Edgewood College.

UW CU invited roughly 600 students to attend the sessions, Long said. "If this pilot program is as successful as we're hoping it will be, we will look to expand to offer additional in-person sessions at more UW System schools and potentially an online counseling option," he added.

CO-OP Financial Services introduces bill pay

 Permanent link
RANCHO CUCAMONGA, Calif. (4/27/12)--CO-OP Financial Services is introducing CO-OP Bill Pay, the company's first online bill pay product line for credit unions

The bill-pay product is the result of CO-OP's  acquisition in January of Corporate Network eCom LLC, the company said. "The new line is a perfect extension of our e-commerce solutions, and will help our clients compete even more effectively against banks in terms of access and convenience services they can offer their members," said Stan Hollen, president/CEO of CO-OP Financial Services.

The line is backed by CO-OP's eCom service organization, with 13 years of experience and providing support to more than 750,000 credit union members.

With CO-OP Financial Services' aggregation of client volume and processing, the company can offer clients bill pay solutions at a better price than that they could secure on their own, the company said.

CO-OP Bill Pay allows members to receive, view, manage and pay all of their bills when they log-on to their credit unions online banking site. The new product line is available in three versions to maximize the range of options credit unions can offer their members.

Features of the CO-OP Bill Pay include:

  • e-Bills. Credit unions can present electronic versions of members' bill, allowing them to view and pay bills immediately.
  • Expedited payments. This feature enables members to make same-day electronic payments.
  • Person-to-Person (P2P) payments. Members can transfer money to anyone having a deposit account in the United States or send money instantly via PayPal.
  • Alerts. Credit unions can send members email alerts regarding payments and other matters.
  • Access by mobile device.

Credit Unions Kids at Heart celebrates Boston Marathon

 Permanent link
BURLINGTON, Mass. (4/27/12)--The Credit Unions Kids at Heart marathon team participated in the 116th running of the Boston Marathon on April 16, raising $100,000 for Children's Hospital Boston. Patient partners, families and friends gathered at Boston's fire station Engine 33, Ladder 15 to cheer on the team as eight credit union runners took to the course in the heat.

One of the world's most challenging courses also featured record-high temperatures, making this year's Boston Marathon especially difficult.

Click to view larger image Credit Unions Kids at Heart raised more than $100,000 for Children's Hospital Boston by participating in the Boston Marathon earlier this month. Members of the 2012 Credit Unions Kids at Heart team gather for a celebratory breakfast at the Westin Copley Place on April 14.
Seven credit union runners made it across the finish line with their patient partners and the children's siblings. The tradition of crossing the finish line together symbolizes the unity of the team, and how they successfully achieved this accomplishment together. Each runner and patient partner team was met with an eruption of cheers from the crowd.

Marathon weekend began with a Credit Unions Kids at Heart breakfast at the Westin Copley Place. Credit union runners, patient partners, family and friends gathered together as Jane Melchionda, EasCorp president/CEO and founder of Kids at Heart, thanked each one for their contributions to the program.

Patient partner Everett Chase with runner Nicole Polex.  Both were are sponsored by Jeanne D'Arc CU. (Photos provided by Credit Unions Kids at Heart)
After the breakfast, guests continued the celebration at a Children's Hospital Boston reception. Nicole Polex of Jeanne D'Arc CU was honored for running the marathon for five years to raise money for the hospital, and for her dedication to the program. Seamus Slattery and Jane Melchionda were both honored with the prestigious Katie Lynch Award. This award is given to those who possess the determination and generous spirit of the award's namesake.

Established in 1996, the Kids at Heart program is a group of credit unions that collectively raise funds to provide programs and services to the children and families receiving treatment at Children's Hospital Boston, as well as for other organizations that work for the benefit of children.

Kids at Heart has donated $3.5 billion to Children's Hospital Boston. The cornerstone of the Credit Unions Kids at Heart program is the Boston Marathon team. Each year, runners sponsored by credit unions are paired with a patient partner who is receiving care at Children's Hospital Boston. These children, who overcome their own challenges every day, inspire the runners to push through their own obstacles as they train for the Boston Marathon.

U.S. Treasury designates Mid Cities CU as CDFI

 Permanent link
COMPTON, Calif. (4/26/12)--Mid Cities CU in Compton, Calif., has been awarded Community Development Financial Institution (CDFI) certification by the U.S Treasury. Certification allows the credit union to apply for grants from the federal CDFI Fund.

The CDFI Fund was created to promote economic revitalization and community development through investment in and assistance to CDFIs. The CDFI Fund was established by the Riegle Community Development and Regulatory Improvement Act of 1994, as a bipartisan initiative. Through monetary awards and the allocation of tax credits, the CDFI Fund helps promote access to capital and local economic growth in urban and rural low-income communities nationwide.

The credit union said it plans to put the new CDFI status "to good use helping the inner cities we serve," says Mid Cities President/CEO Melia Keller. "We couldn't have received our certification without the assistance of National Federation of Community Development Credit Unions. As with most government application processes, CDFI certification is long and tedious.

"The federation was instrumental in hand holding us throughout the detailed application process," she added. "Their knowledgeable staff was able to assist us in quickly collecting the data we needed to support CDFI status and to address any questions or concerns we had throughout the process. I highly recommend the federation to any credit unions considering seeking CDFI status."

Mid Cities CU received assistance from the National Federation of Community Development Credit Union's in its CDFI certification application process.

"This certification recognizes the unique role Mid Cities CU plays in terms of promoting financial inclusion and expanding access to affordable financial services and education to low income consumers and distressed communities," said Pablo DeFilippi, director of membership at the federation. The CDFI certification is a recognition that "sets this credit union apart from many other financial institutions and we welcome them to the growing family of CDFI certified CUs the federation represents," he added.

CU Association of New York GAC kicks off

 Permanent link
ALBANY, N.Y. (4/26/12)--The Credit Union Association of New York's 2012 State Governmental Affairs Conference (GAC) kicked off Wednesday, with nearly 100 credit union advocates gathering in downtown Albany for legislator meetings, peer discussions and updates.

Leaders from state-chartered credit unions gathered for a roundtable discussion Wednesday to exchange ideas and address topics most relevant to state-chartered credit unions. All attendees then heard compliance and legal updates from Michael Lanotte, the association's senior vice president and general counsel, and Michael Carter, the association's compliance director.

"I participate in State GAC because it is important to connect with our legislators, both at home and at their Albany offices, and ensure our credit union voice is heard," said Pamela Heald, president/CEO of Reliant Community FCU in Sodus. "I also value the opportunity to network with other credit union professionals and, at the same time, be educated and updated by the association on key legislative issues."

The association offered a Lobbying 101 workshop for new advocates or those looking for a refresher, followed by a legislative briefing to prepare all attendees for their legislator visits tomorrow. 

"I am looking forward to gaining more knowledge about what issues are facing the credit union movement, as well as having the opportunity to meet with legislators," said attendee Aimee Johnson, vice president of lending at Oswego (N.Y.) County FCU and member of the Association's Young Professionals Commission (YPC). Johnson is one of several young professionals to attend this year's conference.

"This is my first time attending State GAC, so I'm looking forward to seeing Albany at work and meeting with my local elected officials on Thursday," Corning (N.Y.) FCU employee and fellow YPC member Stephanie Carl noted. "I feel it's especially important for young professionals to participate in these advocacy efforts so that lawmakers at all levels can see our involvement and passion for the credit union movement."

The group will visit the offices of their New York state legislators, where they will build support for the state legilsative agenda and share stories of the credit union difference in New York.

Texas Trust CU donates 60K to schools via debit rewards program

 Permanent link
MANSFIELD, Texas (4.26/12)--Texas Trust CU in Mansfield has donated more than $60,000 to four area school districts since August as part of its Spirit Debit Reward program.

The schools earn 15 cents every time a Spirit Debit Reward card is used to make a purchase. Thus far, cardholder transactions have exceeded 405,000 (LoneStar Leaguer April 25).

The program was launched last year as a way to help area schools that are facing tight budgets. Participating schools receive a check at the end of each month, based on the number of transactions swiped from their school-specific Debit Reward Card. Schools get to choose how to use the money they earn.

Within the four school districts that have a Texas Trust Spirit Debit Reward card, there are 11 high schools and two administrations participating.

"The money we earned from the Spirit Debit Reward Card allowed us to provide student planners, which would have otherwise been cut," said Tammy Mariani, principal at Cedar Hill High School. "Texas Trust has given us an easy way to raise money without requiring students to sell candy bars or wrapping paper."

The Spirit Debit Reward Card is part of Texas Trust's Spirit in Action campaign, which supports schools in several ways: a financial education curriculum for high school students; financial literacy workshops for students, teachers, administrators and the community; volunteers for school-related activities; financial donations; and student scholarships.

Credit union members can earn rewards for designated schools when opening a checking account or taking out an auto loan, personal loan, or mortgage. In 2011, Texas Trust donated more than $150,000 to participating schools, including $20,000 in student scholarships.

Credit unions celebrate youth week financial literacy

 Permanent link
MADISON, Wis. (4/26/12)--This week is National Credit Union Youth Week, sponsored by the Credit Union National Association (CUNA). Credit unions nationwide are focusing providing financial literacy education for young members.

Shamzy Romero, business development officer for Security Service FCU, San Antonio, and Richard Maki, vice principal of the Academy of Finance at Business Careers High School, congratulate Jasmine Ancira for her winning essay on financial literacy. Ancira won $500 and her name added to the academy's "Wall of Honor" through a program developed by SSFCU that encourages students to go through a financial reality check, then write about their plans to be financially stable adults. Ancira is a graduating senior who plans to pursue a career in the financial industry. (Photo provided by Security Service FCU)
National Credit Union Youth Week was created by the Credit Union National Association (CUNA) in 2001 as an opportunity for credit unions nationwide to focus on the financial needs of young people and provide financial literacy education.  The event focuses on teaching the benefits of saving and goal setting and invites youth to open savings accounts at their credit union and make deposits throughout the year

This year's theme for National Credit Union Youth Week is "Be a Credit Union Super Saver."

National Youth Saving Challenge, also sponsored by CUNA, is also held during the entire month of April. Last year nearly 146,000 young members deposited $28.5 million into their saving accounts during National Youth Saving Week--with 9,058 new accounts.

National Credit Union Youth Week and the National Youth Saving Challenge take place during April, which is National Financial Literacy Month.

There are several ways credit unions are celebrating financial literacy and National Credit Union Youth Week:

FORUM CU, Fishers, Ind. will be celebrating National Credit Union Youth Week at all FORUM branch locations this week.  Events include kids' activities, giveaways, prizes, and three enter to win contests with prizes including an Amazon gift card, iPod Shuffle, and iPod Nano.  FORUM will deposit $5 into any Aware Kids, Aware Teens or Sprout Account that is opened.  FORUM will also deposit $10 into any free Student Checking Account that is opened, which is available for 16 to 24 year olds. Along with accounts for young people, FORUM also provides interactive financial sites as resources.  These sites feature games, activities, blogs, and useful links relating to money.

Maine credit unions' theme for youth this week is "Super Powers of Savings," reflecting the national theme.

Maine's credit unions will be holding events throughout the week including hosting open houses, contests and other activities for younger members. Many credit unions have also partnered with their local school systems to bring financial education to the students, from holding special financial education sessions to running one of Maine's five in-school branches. 

Jon Paradise, Maine Credit Union League governmental & public affairs manager, said  the week is an opportunity to highlight all that credit unions do for financial education in Maine. "The many activities and events offered by credit unions during this time provide the perfect opportunity for parents to engage their children in an active dialogue about personal finance because parental involvement is critical to helping children become fiscally responsible adults," Paradise said. 

Recent proclamations from the governor and the legislature have recognized the "significant leadership role of Maine's credit unions in furthering financial education learning among Maine's youth."  

As part of the youth week celebration, all 18 branches of Grow Financial CU, Tampa, Fla., will be distributing lollipops, activity books and piggy banks to the children of parents who open a new youth savings account or make a deposit to an existing youth savings account.

At Service CU, kids who make a deposit in their  Smart Savers accounts this week will enter the CUNA Savings Challenge. Service CU will also draw one name from the entries to win a $200 gift card. Free gifts are available to all young members visiting a branch. Service CU offers financial education specifically tailored to its three Smart Saver clubs. The three clubs all include a youth savings account and ATM card.

Six credit unions from The Erie Area Credit Union Partnership participated in the recent Annual Kids Expo in Erie, Pa. Hundreds of children attended event, which include music, games, clowns and prizes. At the credit union booth, children received glow-in-the-dark pencils, activity books, and a chance to have their photo taken as a Credit Union Super Saver Hero.

The six credit unions that participated in the Kids Expo included:

  • Erie (Pa.)Flagship Community FCU;
  • Erie (Pa.) Times FCU;
  • Lake Erie Community FCU, Girard, Pa;
  • Loco. & Cont. Empl. FCU, Erie;
  • Saint Vincent Erie (Pa.) FCU; and
  • North East (Pa.) Welch FCU.
The Erie Area Credit Union Partnership is a collaboration of 12 credit unions located in Erie and the surrounding area.

Youth Club members at Belco Community CU, Dauphin, Pa., will receive special prizes for all branch deposits, special prizes, contests and refreshments when they visit one of Belco's 12 local branches during April. With every deposit of $10 or more into their youth club account, they will be entered to win an Apple iPad2. By saving their money at Belco, children will be helping Belco meet its goals in the National Youth Week Savings Challenge. If the goals are met, Belco will donate $1,000 to the Ronald McDonald House in Hershey, Pa.

Wichita (Kan.) FCU is celebrating youth the entire month of April with promotional activities and contests in its lobbies and on its website and Facebook page. The credit union will match up to $12.50 for children that open up Kids or Teen accounts. Also, every time a teen between the ages of 13 and 18 makes a deposit of at least $10 into their savings account during the month, they will automatically be entered into a drawing. Wichita FCU is also holding a coloring contest for children 12 and under. Kids that bring in a "Credit Union Super Saver" colored page to a location during the month of April to receive a free piggy bank and a chance to win a $25 Toys "R" Us gift card.

ESL FCU, Rochester, N.Y., is holding a workshop on basic personal finance issues. The workshop will cover how to manage money day-to-day, investing and planning for retirement, and setting and reaching financial goals.

California Coast CU, San Diego, has developed a series of new consumer-focused workshops. The financial workshops also offer an opportunity to educate individuals about credit unions and the not-for-profit financial services they offer. California Coast CU works closely with area high schools and colleges in conducting financial literacy presentations. In addition to the financial workshops, the credit union also offers Financial Fitness, a free service designed to help members maximize their paycheck and create a spending plan that they can live with.

At Catholic Vantage Financial CU, Livonia, Mich., kids who make deposits during April will receive a prize and have the opportunity to enter coloring contest or do a puzzle.  During National Credit Union Youth Week at Catholic Vantage Financial, kids who make a deposit will be entered in a drawing to win a larger prize at the end of the week. The credit union is also offering financial literacy reading program. The readings engage students in discussion and allow them to discover new information on finances.

Hughes FCU, Tucson, Ariz., co-hosted the Arizona Financial Face Off, in which students from 14 local schools tested their knowledge of financial issues.

Security Service FCU, San Antonio, held a financial literacy essay contest. Contest winner Jasmine Ancira received $500 and her name was added to the academy's "Wall of Honor." The contest encouraged students to go through a financial reality check, then write about their plans to be financially stable adults.

Michigan First CU was featured on the National Public Radio station WDET 101.9 FM discussing the credit union's 27 student-run branches and extensive financial education programs.

Torrance (Calif.) Community CU offers Indie Money a program of financial services and education designed to teach financial responsibility and to help teens between the ages of 16 and 17 establish credit in a monitored, conscientious way with real-world credit and debit products. To ensure teens are armed with the knowledge and skills necessary to manage their new accounts, they must first pass the Indie Money Challenge and attend orientation with a TCCU staff member.

CUNA Mutual offers more Discovery Webinars

 Permanent link
MADISON, Wis.  (4/26/12)--CUNA Mutual Group's free Discovery Webinar series  continues in May with two risk management-related events.

Ann Davidson, CUNA Mutual senior consultant, risk management will present "Mobile Financial Services: The New Frontier," at 12:15 p.m. CDT, May 2. The presentation will discuss both the risks and rewards of offering bill payment, money transfer, remote deposit, and other services via mobile devices. Participants will learn how to maintain their competitive edge by offering this service while effectively managing its risks.

Brad Mundine, CUNA Mutual senior manager, risk management will present "Member Business Lending: Get the Volume Without the Noise," will at 12:15 p.m. CT on May 23. The session will focus on the current member business lending environment in the credit union space, providing a practical approach to implementation for risk management recommendations. He'll explore risk management techniques to align credit union lending program with their appetite for risk and examine additional member business lending income-related opportunities to consider as part of credit unions' strategic planning.

Both Discovery Webinars are free, 60-minute events that include live question-and-answer sessions.

To register, use the link.

CUNA Coopera offer Hispanic Webinar series

 Permanent link
DES MOINES, Iowa and MADISON, Wis. (4/26/12)--Coopera has partnered with the Credit Union National Association (CUNA) to host a series of webinars for credit unions. The objective is to educate as many credit union leaders as possible on the importance of adapting products and services to meet the needs of Hispanic members. 

The webinar series has so far garnered attendees from more than 100 credit unions. More webinars are scheduled for the remainder of the year, with the next set to take place on May 16 from 1:30 to 2:30 (CT).

Each hour-long webinar will offer credit unions ideas and best practices for reaching --and best serving --Hispanic consumers in local communities nationwide.

"Savvy credit union executives realize the face of the American consumer is changing," said Coopera Vice President Miriam De Dios. "To grow a credit union's membership, leadership must adapt to their new consumers. It is the integration of a Hispanic growth strategy with the credit union's overall strategic future that will ultimately create sustainable success."

Upcoming webinar events include:

  • Financial Education for Hispanics--What's Important to Them?;

    May 16, 1:30-2:30 p.m. (CT)

    A strong financial education strategy for Hispanic members is a Hispanic outreach best practice in the industry. This webinar will provide insight into relevant topics and available resources and tools to create a successful financial education strategy for Hispanic members.


  • Are Hispanics Accessing Financial Information Online

    June 27, 1:30-2:30 p.m. (CT)

    This webinar offers recent statistics about Hispanics and technology. Learn about relevant ways to deliver this online content.


  • How to Deliver Financial Education to Hispanics

    July 18, 1:30-2:30 p.m. (CT)

    This webinar offers advice on connecting financial education with the needs of Hispanic members and how to provide staff the tools they need to teach Hispanic members.

In addition to the upcoming webinars, credit union staff may also view archived webinars for a limited time:

  • Stop Spinning Your Hispanic Outreach Wheels Series--The HON Demographic and Branch Analysis

    Available through May 23


  • Stop Spinning Your Hispanic Outreach Wheels Series--Changing Your Organizational Culture

    Available through June 14


  • How Hispanic Members Contribute to Your Bottom Line

    Available through Sept. 28


  • What's Different About Serving Hispanics?

    Available through Oct. 18

Lt. Gov. addresses Michigan league GAC

 Permanent link
LANSING, Mich. (4/26/12)--Michigan Lt. Gov. Brian Calley, addressing the Michigan Credit Union League (MCUL) Governmental Affairs Conference (GAC) in Lansing, Mich., last week, talked about state tax structure, jobs, and credit union member business lending.

Mich. Lt. Gov. Brian Calley was the keynote speaker the Michigan Credit Union League Governmental Affairs Conference in Lansing, Mich. last week.
The 1990s were great for Michigan with lower unemployment and higher prosperity than the national averages, but those numbers were flipped for the 2000s, Calley said. (Michigan Monitor April 23).

Calley ran with Michigan Gov. Rick Snyder on a platform that they would reinvent Michigan to be more business friendly and to encourage existing companies to expand.

For the first time in 15 years, the state's tax policy is not designed to promote outside businesses coming in, meaning existing businesses actually pay more, Calley said.

"Everybody's for jobs," he added, "but if you want more of them, it's kind of important to understand where they come from."

One of the most important changes the administration made was to reform the state's business tax, which was considered the second worst in the United States, and replace it with one that is simple and now ranked seventh best, Calley said.

Michigan Credit Union League CEO David Adams said credit unions can offer more services by taking advantage of resources such as credit union service organizations. (Photos provided by Michigan Credit Union League)
He said that the state still has $638 million in tax breaks on the books, but slowly, that number will fall. Despite the tax breaks, the state ended up losing jobs in the relocation category anyway.

In addition, the Snyder administration has gone after needless regulations by forming the Office of Regulatory Reinvention. In just one year, Calley said, the state reduced the number of regulations by 400.

He added that the work is starting to show dividends. Last year, the state saw 80,000 new private sector jobs and per-capita income rose 5.2%.

Calley said that like credit unions, the state has focused on customer satisfaction. He also challenged credit unions to learn what their members dream of and find out what they can do to help.

MCUL CEO David Adams told the GAC audience that when he was recognized as U.S. Small Business Administration (SBA) as the 2012 National Financial Services Champion,  both in the state and nationally, it showed that the industry as a whole is really on an upward path.

"It's reflective of what our industry has been doing," Adams said. "People are discovering credit unions like never before."

He emphasized that credit unions have an unprecedented opportunity during this session of the U.S. Congress when the Senate is expected to vote on an historic credit union bill that would raise the limit on member business lending.

"Credit unions are being noticed for their efforts on small business lending," Adams said.

Adams said credit unions--even small institutions--can do a better job of marketing more services by taking advantage of resources such as credit union service organizations.

Because of their tax-exempt status, Adams said credit unions have an obligation to reach out to consumers to help the country reverse some troubling statistics, such as the one-third of U.S. adults who say they have no non-retirement savings and the 32% who say they are saving no part of their household income for retirement.

ACUC speaker explores generational mix

 Permanent link
MADISON, Wis. (4/25/12)--For the first time in history, four generations work, compete, purchase and--often--clash in the marketplace. That trend will only continue as Baby Boomers extend their working years and Nexters-- those born between 2000 and the present--assimilate into the marketplace.

Businesses, including credit unions, have a stake in understanding the differences, nuances and commonalities of each generation.  In her presentation at America's Credit Union Conference, What Makes the Generations Tick and What Ticks Them Off, Anna Liotta, creator of Generationally Savvy Communication Solutions, will describe how credit unions can leverage this understanding to improve the performance of their organizations.

"A lot of money is spent work around people's personalities when a better perspective of what shaping and informing their decisions would provide more value," Liotta told News Now. "This talk will help people understand why the approach one person takes may seem so ineffective to you but comes naturally to them. "

Most generational clashes are unintended, and most of the parties involved have no idea how they are rubbing the other party the wrong way, Liotta said.

She offers the different approaches of Generation X—those born between 1964 and 1979 and Baby Boomers, who were born between 1946 and 1963.

"Gen Xers want to get right to the bottom line," Liotta explained. "Gen Xers don't think there's any business conversation that should take any longer than 20 minutes."

Baby Boomers, on the other hand are all about relationships, she explains. "They want to know where you're from and how many kids you have and where you went for vacation," Liotta said. "This drives Gen Xers crazy."

As for Generation Y,  those born between 1980 and 1999? "They like to tell you about their accomplishments," Liotta said.

Credit unions offer a value proposition that resonates with Boomers, Xers and Gen Y.

For Boomers, many of whom helped form credit unions,  they offer great financial value, a better deal than the banks, Liotta said.

For Gen X, credit union offer a transparency and a spirit of individualism that Xers can relate to with big financial institutions. "Xers are looking for boutique-type organization and that independent credit union brand appeals to them as both consumers and employees."

Gen Yers, who are always looking for a cause to align themselves with, prefer credit unions community based approach, Liotta said.

Liotta said credit unions must communicate who they are and what they do within a framework that identifies the values of each generation.  Her ACUC presentation will help credit unions understand those values.

"We will learn what shapes each generation's world and what it looks like on a day-to-day basis as they make decisions," Liotta said. "Then we'll explore  how credit unions can be effective in communicating to them at a level that appeals to each generation."

Gov. signs public deposits bill supported by Minn. CUs

 Permanent link
ST. PAUL, Minn. (4/25/12)--Minnesota Gov. Mark Dayton signed legislation late last week after the Minnesota Credit Union Network (MnCUN) and its governmental affairs department were successful in a push for credit union inclusion in the language of a bill involving deposits from public entities.

The public deposits bill (H.F. 2174) was part of an advocacy effort led by MnCUN's governmental affairs team to include credit unions as approved financial institutions able to redeposit funds from the state's cities and counties. The bill unanimously passed in the state House in March and the state Senate last week. It now includes credit unions alongside other financial institutions.   

H.F. 2174 was a key focus for MnCUN's governmental affairs team this legislative session. The MnCUN-supported bill provides additional flexibility to financial institutions in Minnesota that accept public deposits.

"The signing of this public deposits bill recognizes the important role credit unions play in our communities," said MnCUN President/CEO Mark D. Cummins. "This bill equips credit unions for the future in enabling them to promote products and services associated with accepting these deposits."

Several other states also allow credit unions to accept deposits from public entities or else have legislation pending, including California, Illinois, Missouri, New Jersey, New York, Ohio, Oregon and Washington.

Another top priority for MnCUN's governmental affairs team was continuing to ensure that credit unions' tax-exempt status was protected as the state House and Senate considered tax reform legislation. The current state legislative session is expected to conclude soon.

Design thinking the focus of first crash the ACUC

 Permanent link
MADISON, Wis. (4/25/12)--For the first time, attendees of the Credit Union National Association (CUNA) America's Credit Union Conference (ACUC) will be joined by a select group of 15 young credit union leaders, known across the industry as the Crashers, according to the Filene Research Institute.

The Crash trend was born from a 2010 Filene Research Institute project in which a group of young credit union professionals crashed the Credit Union National Association (CUNA)s Governmental Affairs Conference and the CUNA/World Council of Credit Unions The 1 Credit Union Conference. Three crashers of those events helped create the Washington, D.C., event. This Crash builds on the original program.

This Crash, like previous events will coincide with the basic conference agenda established by CUNA--including scholarships for registration--but the projects, as a result of the experience, will be different.

The 2012 Crash the ACUC will be taking on a unique approach when it comes to problem-solving. Starting June 17th, the selected Crashers for Crash the ACUC will be partake in a day-long Design Thinking Workshop led by Julie Norvaisas, design researcher and strategist.

The team of 15 will initially focus on learning the concepts of design thinking and its applications to solving real-world problems.  During the week, the selected 15 will apply design thinking methods and theory to spark innovation. The result will be a viable business concept for credit unions. Pre-conference assignments will be required to engage the topic and to feed intense research and discovery sessions. In the end, the group will create something wholly new and applicable in the credit union system.

Sparking the conversations on Sunday will be a focus on community development.

"The time is ripe for credit unions to be bold," Norvaisas said. "The unbanked and under-banked are a dreadfully underserved market; they commonly fall prey to predatory business practices and struggle to deal with financial transactions that most of us take for granted. Together the group will understand their needs and motivations and discuss the constraints that make it difficult to serve them in traditional financial services businesses, such as credit unions, so we can rise to the challenge."

There is increased commitment this time around, both from extended on-site time and required homework in advance. With this added investment, Crashers can guarantee their time out of the office will be valuable, as they return home with a real-world solution for their credit union and their community, Filene said.

In addition to Crash the ACUC, The Cooperative Trust has three national and four regional events planned alongside new opportunities, including year two of The Collider innovation tournament.

The Cooperative Trust is a grassroots organization hosted by the Filene Research Institute and supported by CUNA Mutual Group. The Cooperative Trust connects and enables young people fighting for the future of socially responsible finance through meet-ups, mentorships, and collective action. For more information, use the link.

Two CUs settle ATM lawsuits in Michigan federal courts

 Permanent link
DETROIT (4/25/12)--Two Michigan credit unions, ACC Community CU in Grand Rapids and Lenco CU in Adrian, have settled separate ATM class-action lawsuits brought by area retiree Nancy Kinder who has filed nearly 40 lawsuits against credit unions and banks under the Electronic Funds Transfer Act (EFTA).

The ACC Community case was settled in U.S District Court for the Western District of Michigan. The Lenco CU case was in U.S. District Court for the Eastern District of Michigan.

Michigan couple Nancy Kinder and Ray Harrison of Fowlerville, Mich., who are both retirees--have driven around the country looking for ATMs without proper fee notification signs. The two then photographed ATMs that lack legal signage and filed class actions against the credit unions and banks that own the ATMs, saying that nondisclosure of fees for ATM transactions violates EFTA, according to court records. In 2010 and 2011, Kinder and Harrison filed dozens of lawsuits in Michigan, New Mexico and Texas (News Now May 24). 

The EFTA requires ATM owners to post a fee notice on the outside of their machines. As stated in the settlement documents filed with the court, both credit unions dispute that the plaintiffs have suffered any actual harm or damages as a result of the absence of an on-machine posted fee notice, and acknowledge that the ATMs are equipped with on-screen fee notices that permit the customer to cancel the transaction before incurring a fee.

However, given the expense of litigation, both credit unions agreed to settle the cases against them. Under the settlement, both credit unions have agreed to pay nonmember users of specific ATMs up to $250 to settle EFTA violations.

Each credit union also will pay $1,000 to Kinder, and $15,000 in legal fees. Lenco CU has agreed to set aside $23,500 to satisfy the claims of up to 1,155 potential claimants--based on the number of nonmember transactions that took place at a specific credit union ATM in Adrian between April 19, 210 and April 18, 2011. Each nonmember withdrawing from that ATM is eligible for a pro-rata share of the settlement fund, but no claimant may receive more than a $250 payment.

After all individual claims have been settled, any money remaining in the settlement fund--up to $5,000--will be donated to Kinder's designated charity--the Karmanos Cancer Institute.

ACC Community CU agreed to put aside $27,000 to satisfy the claims of up to 1,844 claimants, which is based on the number of nonmember transactions that took place at ACC's ATMs in three locations between April 26, 2010 and April 25, 2011. Each nonmember withdrawing from that ATM is eligible for a pro-rata share of the settlement fund, but no claimant may receive more than a $250 payment. Any funds remaining after the claimants are paid--up to $7,000--will be donated to Kinder's designated charity--the Karmanos Cancer Institute.

In both cases, after all claims have been satisfied, and any charitable contribution up to the allowed amounts have been paid, any remaining funds will go back to the credit union or CUNA Mutual Group, which is its insurer. CUNA Mutual, under its bond, is funding the settlement.

One nomination received for CUNA Board election

 Permanent link
MADISON, Wis. (4/25/12)--The Credit Union National Association is holding a special election for the District 5, Class C Board of Directors position, previously held by Harriet May, who resigned March 31. 

Tony Budet, president of University FCU in Austin, Texas has been nominated for the position.

Credit unions in this category were notified of the special election on April 3. 

All nominations must be received by close of business on Friday.  If contested, ballots will be sent and voting will take place from April 30 to May 25. 

The term of office will begin immediately upon election and will continue through the adjournment of the 2014 CUNA Annual General Meeting.

Class C credit unions are those with at least 86,000 natural person members. 

To request additional information or file a nomination, call 800/356-9655, x4013 or email thanson@cuna.coop.

Kansas CUs honor five

 Permanent link
WICHITA, Kansas (4/25/12)--More than 350 Kansas credit union representatives gathered in Wichita last weekend to mark the Kansas Credit Union Association's (KCUA) 77th Annual Meeting and Convention, and to witness five of their colleagues receive honors. 

Click to view larger image Larry Eisenhauer, left, president/CEO of Kansas Corporate CU, Wichita, received the Henry Peterson Professional of the Year Award at the Kansas Credit Union Association's (KCUA) 77th Annual Meeting and Convention .  Pictured with Eisenhauer are KCUA staff Marla Marsh, Bob Mayes and Elizabeth Stuart.
The two-day event featured industry speakers and a variety of educational and networking opportunities. The keynote presentation by Mark Sievewright, president of CU Solutions at Fiserv, addressed the ever-changing financial landscape.  Other sessions included social media, member relations, credit bureau fraud and sessions specifically for young professionals.

The five credit union leaders honored at the event included:

  • Larry Eisenhauer, president/CEO of Kansas Corporate CU, Wichita, received the Henry Peterson Professional of the Year Award.
  • Larry Duntz, chairman of the Board for Central Star CU, Wichita, and Robert Reeves, chairman of the Board for Kansas State University FCU, Manhattan, were honored as the John Michener Volunteers of the Year.
  • Henry Buset, Kansas Teachers Community CU, Pittsburg, was inducted into the KCUA Hall of Fame.
  • LeeAnn Marker, Hutchinson CU, Hutchinson, received the Political Involvement Award.
Mid American CU was also recognized for winning a first-place award in the Desjardins Youth Financial Education Program. The Wichita-based credit union won the award for teaching a financial literacy course to more than 500 students as part of a summer youth program in some of Wichita's most culturally diverse and economically disadvantaged neighborhoods.

Click to view larger image From left, Bob Corwin and Rick Dodds of Meritrust CU with John Smith, Kansas Department of Credit Unions at the Kansas Credit Union Association Annual Meeting. (Photos provided by Kansas Credit Union Association.)
As part of the association's business meeting, KCUA conducted its annual board elections. The Executive Committee was elected. It includes:

  • Chairman--Jim Holt, president/CEO of Mid American CU, Wichita;
  • Vice Chair--Don Homan, Frontier Community CU, Leavenworth; and
  • Secretary/Treasurer--Vickie Hurt, President of Quest CU, Topeka.
Newly-elected board members include:

  • Rick Blue, president/CEO of White Eagle CU, Augusta;  and
  • Denise Bonner, manager of Wakarusa Valley CU, Lawrence.
KCUA board members continuing their terms include:

  • John Beverlin, president/CEO of Mainstreet CU, Lenexa;
  • Larry Damm, president/CEO of Cessna Employees CU, Wichita;
  • Rosa Saenz, senior vice president of Golden Plains CU, Garden City; and
  • Garth Strand, president/CEO of Hutchinson (Kan.) CU.

Media highlights MBL progress

 Permanent link
MADISON, Wis. (4/25/12)--Credit unions continue to reap media attention for their efforts to increase member business lending (MBL) authority.

A pending Senate bill (S.  2231), like its counterpart introduced in the House (H.R. 1418), would increase the MBL cap to 27.5% of a credit union's assets, up from 12.25%, under certain conditions.

Within the first year of enactment, the increased MBL authority would help to inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA estimates show.

Senate leadership remains committed to a floor vote on the credit union legislation to increase the member business lending (MBL) cap, a pledge reiterated Monday by Sen. Charles Schumer (D-N.Y.), the third-ranking Democrat in the Senate.

An article in the April 22 edition of The Wichita Eagle described how two Kansas credit unions, reaching current MBL thresholds, may have to start saying 'no' to small businesses seeking loans because of the current 1225% cap.

"Our small business members have been hearing the message we may have to say 'No,' because this arbitrary cap is upon us," Garth Strand, CEO of Hutchinson (Kan.) CU, told the Eagle. "Short of being out of compliance and being out of regulation, we don't have any choice but to comply."

Strand stressed that increased business lending should not be framed as a banks-versus-credit union issue.

"It's really a small-business issue," Strand said. "Our economy is struggling, and we need as many jobs as we can get. We should be looking for solutions and not roadblocks."

In the same article, Bob Corwin, CEO of the state's largest credit union at $820million in assets,  Wichita-based Meritrust, said member business loans account for about 5% of its asserts right now.

"We think, just from the principle of the thing, credit unions should not be restricted in any kind of lending without any real rationale or justification for it," Corwin told the paper.

Haley DaVee, vice president of governmental and public affairs for the Kansas Credit Union Association, noted in the article that an MBL cap increase would not  mean an immediate explosion in business lending by credit unions. She noted the bill would lift the cap only for credit unions that:

  • Have five years of experience making member business loans.
  • Employ loan officers on staff with at least two years of commercial lending experience.
  • Maintain a member business loan portfolio that totals 80% of the 12.25% cap for at least four quarters preceding the credit union's request to increase its lending cap.
 

Hutchinson Strand concluded the article expressing hopes the bill passes because he doesn't want to be forced to turn away from his small business members' needs:  "We are trying to find a solution for them, and we are stuck," he said.

The current MBL cap also prevents some credit unions from entering the business lending market, Scott Earl, president/CEO of Mountain West Credit Union Association told the Colorado Springs Business Journal  (April 23).  "It was not a big enough part of their lending portfolio to hire experts in small business lending," Earl said. "But, with a higher cap, credit unions that had been reluctant to get into small business lending may embrace it.

Mountain West Credit Union Association represents credit union in Arizona, Colorado and Wyoming.

"That is where we could see the biggest change happening," Earl said. "Most (credit unions) would find it appealing --if it fits into their business plan, they would think about this."

In an article in Finance & Commerce, Patrick Pierce, CEO at the City and County CU in St. Paul, stressed that the MBL legislation would improve the economy at no cost to tax payers.

"Congress wants to see the economy grow, and we want to get more loans out to businesses that will put people back to work," said Pierce said. "If they let credit unions do what we do well, we'll help create jobs, and it's not going to cost the government a dime."

Ryan Donovan, senior vice president of legislative affairs for the Credit Union National Association, explained in the Finance & Commerce article that credit unions increased  their business lending efforts during the recession, while commercial lending at banks declined.

Data from regulators showed business lending at Minnesota credit unions grew between 1.1 % and 11.8% between 2007 and 2011. Meanwhile, business lending (excluding commercial real estate) fell 11.3% at Minnesota-chartered banks in the 2009- 2011 period.

In a April 22 NewsOK article, Gary Jones, president of Credit Union Association of Oklahoma, said allowing credit unions to make more business loans would create more jobs and enhance the U.S. economy.

"The members of the credit unions have not been able to get money from the commercial banks because generally they're not of a size that they (the banks) are even interested in," Jones said. "Our members have come to us and said we'd like to have some money for our business, and there is an artificial cap on what we can loan that we know is restricting our ability to respond to these requests from our members."

Bill Hammond, president/CEO of the Texas Association of Business contributed an opinion editorial to the Houston Chronicle in favor of the legislation. Hammond also noted that business lending at banks has plummeted in recent years.

"But there has been one bright spot in the tough lending picture, and that is credit unions," Hammond wrote.

"Credit unions have been not-for-profit for more than 100 years and still have less than 5% of the business-lending market," he added. "It's unlikely that raising the cap will do anything other than provide more small business owners the chance to succeed while filling gaps in the marketplace."

Mike Beall, Missouri Credit Union Association president/CEO, contributed a letter to the editor to recent edition of the Springfield Business Journal.  Beall described how the MBL legislation would create jobs and help small businesses in Missouri.

"It's time to do all we can to raise capital safely and soundly for small businesses," Beall wrote in his letter.

SECU tax prep services save members 86M

 Permanent link
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

 Permanent link
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

 Permanent link
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

 Permanent link
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

 Permanent link
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

 Permanent link
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

 Permanent link
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.

CU System briefs (04/20/2012)

 Permanent link
  • ETTRICK, Va. (4/23/12)--A Virginia State University (VSU) student was arrested and another is being sought by police in relation to the fatal shooting Tuesday of Tyrail W. Hughes, 20, of Petersburg, Va., in the parking lot of Virginia State University Credit Union. An 18-year-old passerby was also shot in the leg by stray bullet during the altercation between two groups of young men. Artarrius Jamar Stepter, 20, was charged with brandishing a firearm during the incident, which occurred at 4:20 p.m. Still at large is Ryan Christopher Simms, 19, who is being charged with murder, felonious assault and use of a firearm in the commission of a felony. Simms and Stepter are students at VSU (Richmond Times-Dispatch April 20) …
  • ROCKFORD, Ill. (4/23/12)--A former collections supervisor at Rock Valley FCU, Loves Park, Ill., was sentenced to nine years in prison for allegedly embezzling more than $122,000 from the credit union. Thomas A. Miles, 42, pleaded guilty in a plea bargain to stealing about 163 checks payable to members from October 2007 to August 2010. As supervisor, he oversaw funds received from delinquent loans and credited to members' accounts. He allegedly ordered tellers to cash the checks and issue money orders, which he deposited into a savings account at a bank. Then he would transfer the funds to his personal checking account at the credit union. In addition to the prison term, he was sentenced to three years of supervised release, with the first nine months under house arrest with electronic monitoring, and was ordered to pay more than $122,110 in restitution (WREX.com April 19) …
  • ALBUQUERQUE, N.M.(4/23/12)--The New Mexico Credit Union Education Foundation (NMCUEF) awarded $122,000 in scholarships to 122 students in New Mexico for the 2012-2013 school year. Each scholarship recipient was awarded $1,000. The NMCUEF program was formed through special legislation that allows credit unions to use abandoned funds for educational or charitable purposes. Since it was established in 1992, NMCUEF has presented 1,191 scholarships totaling $734,600 to students attending accredited vocational or technical schools, colleges or universities in New Mexico, according to the Credit Union Association of New Mexico …

J.D. Power Consumer satisfaction with bank fees drops

 Permanent link
WESTLAKE VILLAGE, Calif. (4/23/12)--Consumers grew increasingly dissatisfied with retail banking fees in the past year, with a satisfaction index at 608, down significantly from 625 in 2011 and 656 in 2010, says  a new survey released Thursday by J.D. Power and Associates.

The 2012 U.S. Retail Banking Study, in its seventh year, indicated that overall retail banking customer satisfaction is stagnant, improving by one point in 2012--to 753 on a 1,000-point scale.  The study measured six factors of satisfaction:  account activities, account information, facility, fees, problem resolution and product offerings.

Monthly maintenance fees had the most significant impact on fees satisfaction this year--more so than in the 2011 and 2010 studies--while ATM and debit card fees had less negative impacts on fees satisfaction, said the study.

"The negative reaction to fees reflects customers' irritation about paying for something they didn't have to pay for in the past," said Michael Beird, director of banking services at J.D. Power and Associates. "It also reflects a lack of their complete understanding about what they're getting for those fees. Customers understand why they're being charged for ATM and debit card use, but are not clear on what they're getting for monthly maintenance fees, which drives the bigger drop in satisfaction with those fees."

The study noted improvements in satisfaction with facilities and routine transactions, and with reliability and ease of using ATMs, with the percentage of customers who use ATMs to make deposits more than doubling to 40% in 2012 from 19% in 2008.  Regional banks--defined by the survey as banks with $33 billion to $180 billion in deposits--saw the biggest drop in satisfaction, dropping to 759 from 760, when compare to small banks and big banks.

Big banks still lag other banks in overall satisfaction, but they have improved in reducing the number of problems customers experience and in problem resolution, especially at first contact, said Beird.

Although credit unions aren't included in the study, plenty of recent studies have reported that member/customer satisfaction with credit unions have topped bank customer satisfaction.  Examples include an American Customer Satisfaction Index survey ( News Now Dec. 13),  2011 Bank and Credit Union Satisfaction Survey by Prime Performance (News Now Dec. 8), a 2011 Customer Experience survey by Prime Performance (News Now March 9 ) and a loyalty survey by Temkin Group (News Now March 21).

May receives Texas league Hall of Fame award

 Permanent link
FARMERS BRANCH, Texas (4/23/12)--Harriet May, retiring CEO of El Paso-based GECU and immediate past chairman of the Credit Union National Association, received the Texas Credit Union League's prestigious Hall of Fame award last week.

May's 38-year credit union career began in the mid-70s when she became a teller at GECU.  She rose through the ranks, serving in various management and executive management positions until she became CEO in 1996, said the league (LoneStar Leaguer April 20).

Under May's leadership, GECU more than tripled in size. Today it has more than $1.8 billion in assets, with more than 720 employees serving more than 300,000 members, and is the largest independently owned financial institution in El Paso.

NCUA to WesCorp court Conservators can deny officials coverage

 Permanent link
LOS ANGELES (4/23/12)--The National Credit Union Administration (NCUA) has filed more documents in its negligence lawsuit against former Western Corporate FCU senior executives, telling a federal court in Los Angeles that , as the failed corporate's conservator, it has authority to deny the former executives indemnification and insurance coverage.

NCUA filed the documents April 18 in the U.S. District Court, Central District of California, Western Division, in response to counterclaims by the former WesCorp officials. 

The original suit named as defendants: Robert A. Siravo, former president/CEO; Thomas Swedburg, former vice president of human resources; Todd Lane, former chief financial officer; Robert J. Burrell, former chief investment officer; and Timothy T. Swidley, former risk officer. Swedburg and Sidley have settled their lawsuits (News Now April 16).

In its response, NCUA said that "defendants may not pursue a claim for indemnification against the NCUA because officers or directors of a failed institution may not obtain indemnification for actions brought against them by the institution's receiver, regardless of whether they might have had a right to indemnification by the financial institution had it not failed."

The agency noted in the documents that because the defendants were responsible for purchasing an insurance policy on behalf of Wes Corp and elected to purchase the policy that they did, then the executives "are barred from pursuing a claim against WesCorp's successor the NCUA based upon any alleged inadequacy in the insurance policy so purchased."

It also said that--without conceding any act of the NCUA caused damages to the three--it is entitled to offset and recoup against any judgment that may be entered favoring the executives.

NCUA sued the WesCorp senior executives to try to recoup $6.8 million in investment portfolio losses from mortgage backed securities, alleging the executives were negligent in monitoring the corporate's investments. NCUA also alleged a breach of fiduciary duty and fraud related to the investments that contributed to WesCorp's collapse.

In addition to their defense costs, damages and other court costs, the WesCorp executives had demanded that  NCUA indemnify them under Policy 21 adopted by WesCorp so current and former officials and employees could recover costs and attorney fees in case of a lawsuit.

NCUA said in the documents filed last week that it did not renew the policy when it expired.

Maximize HR investment with simpler human capital strategy

 Permanent link
SAN ANTONIO (4/23/12)--Understanding the overall health and readiness of a credit union's human capital and effectively communicating the value of employee benefits can help attract and retain talent and favorably impact the bottom line, attendees at the CUNA Human Resources/Training and Development Council Conference in San Antonio were told Friday.

CUNA Mutual Group's Mike Roche, employee benefits specialist, discussed the employee benefits concept of "Human Capital Management" and how it can help organizations enjoy a stable, talented and energized work force during the CUNA Human Resources/Training and Development Council Conference in San Antonio Friday. (Photo provided by CUNA Mutual Group)
Mike Roche, employee benefits specialist at CUNA Mutual Group, and Brad Pricer, CUNA Mutual human resources process leader, discussed the employee benefits concept of "Human Capital Management" and how it can help organizations enjoy a stable, talented and energized work force.

Human resources leaders in today's competitive marketplace are challenged by hard-to-reach bottom lines, job consolidation, technology changes, health care reform and a shrinking labor pool. Also, employees are often confused or not engaged when making benefits decisions. Roche cited a 2011 AFLAC Workforce Report that stated only 8% of workers strongly agreed they were fully engaged in making benefits decisions.

Simplifying human capital management acknowledges that your employees are not all the same, which forces you to provide them choices, Roche said. "It aids in analyzing work force strengths and vulnerabilities, and identifies opportunities and strategies to proactively manage employees," he added.

Roche suggested offering a good voluntary benefits program coupled with clear communications that articulate the personal benefit they receive. "These efforts will help your credit union attract and retain talent, which directly impacts the bottom line," he said.

Pricer said credit unions should get away from the traditional metric-based approach when analyzing the state of their human capital.

"Human capital is more than just the people in the organization; it includes an individual's ability, behavior, skills and tenure," Pricer explained. "The problem with using metrics to define and measure human capital is it doesn't necessarily create a clear picture of your current human capital state and how you should manipulate it going forward."

Too much time is spent identifying, measuring, and tracking human capital metrics. Instead, Pricer suggested creating a simplified approach to more easily define the strategy and identify needed resources. "This allows you to quickly explain human capital needs to C-level management or the board of directors and where resources should be targeted," he said.

Pricer discussed "heat mapping" as a means to quickly define and explain the state of a credit union's human capital.  Heat maps tell a concise story that can be told with just a few sheets of paper (or slides) instead of thick binders full of metrics.

Heat maps identify strengths and weaknesses within the technical functions of an organization by using a color-coded chart listing the different functional roles against the categories being measured within each role. Those categories should be: subject-matter expertise, capacity, and capability.

Pricer said creating a heat map offers numerous advantages that allow credit unions to: Put in place a succession-type plan at all levels;
  • Understand the overall health and readiness of the organization's human capital;
  • Engage the best employees to drive success;
  • Focus resources appropriately to improve the overall state of the credit union's human capital; and
  • Provide an easy explanation to C-level management and/or board of directors
"By employing a human capital strategy, your credit union can ease the challenges and burdens of tracking day-to-day human capital management and free up staff to pursue other initiatives to increase employee engagement and satisfaction," Pricer said. "Ultimately, this will help attract and retain key individuals."

Catalyst files preemptive patent lawsuit

 Permanent link
SHERMAN, Texas (4/23/12)--Catalyst Corporate FCU has filed a lawsuit in a federal court in Texas, seeking a declaratory judgment that it has not infringed on any processing patents, after it received a letter from a company representing an unknown "John Doe" patent holder threatening Catalyst with a lawsuit if it did not sign a confidentiality agreement.

Plano, Texas-based Catalyst filed the pre-emptive strike in the U.S. District Court for the Eastern District of Texas, Sherman Division. In the complaint, Catalyst said it received a letter and a "Proposal to Negotiate Patent License" on March  27 from IP Navigation Group,  also known as IPNav, a Dallas-based company that bills itself as a "leading global intellectual property advisory firm" that has "expertise in monetizing patents."

According to the complaint filed, IPNav claims that it focuses on "turning intangible assets into tangible profits" with its "monetization solutions," and that it "employs an aggressive approach to monetizing patents, which has resulted in the filing and litigating of a large number of patent infringement lawsuits."

The letter to Catalyst Corporate noted that an "analysis of your products shows that your company makes, uses, or sells products or services that would benefit from a license to [Doe's] patents." It demanded Catalyst sign a confidentiality agreement "as a predicate to IPNav identifying 'specific patents and provid[ing] information outlining the basis for the infringement claims against your products or services.'"

Catalyst claims the letter indicates that IPNav and Doe "are prepared to sue if Catalyst does not agree to their terms." The terms include provisions that would bar Catalyst from suing the firm, but not barring IPNav or Doe from filing a patent infringement lawsuit.

"Catalyst has been placed in the untenable position of being forced to choose between waiving its legal rights pursuant to the terms of the agreement or subjecting itself to an ongoing threat of litigation and unspecified allegations of infringement directed at the core of Catalyst's business. Catalyst refuses to make such a choice and, instead, asks this court to declare Catalyst's legal rights now in its home court."

The suit seeks a declaration that Catalyst "has not infringed and is not infringing, directly or indirectly, any valid claims of the asserted patents" and an order permanently enjoining IPNav, Doe, and their representatives from asserting that the corporate infringed on any valid patent claim.

Advances in technologies and processes such as remote deposit capture technology, payments processing, and online and mobile banking technologies have been targets of several patent infringement lawsuits. Credit unions and banks using both third-party service providers and in-house processes for their new technologies have been  threatened with litigation as a result.

Succession plans--Dont ignore development

 Permanent link
SAN ANTONIO (4/23/12)--Even if they have CEO succession plans in place, credit unions risk losing CEO replacements to other organizations if their plans do not have an executive development component that includes financial incentives to retain top talent, said CUNA Mutual Group's John Moreno Friday.

Credit union succession plans should include financial incentives to retain executive talent, said CUNA Mutual Group's John Moreno during a CUNA HR/TD Council Conference breakout session Friday. (Photo provided by CUNA Mutual Group)
He spoke during a CUNA Human Resources/Training and Development Council Conference breakout session in San Antonio.

Moreno, an executive benefits specialist with the insurer, said credit unions need to take a hard look at their succession plan and determine if they have a true succession plan or a "Break in Case of Emergency" plan.

The latter is an emergency CEO succession plan that prepares the credit union for the death or rapid, unexpected departure of the CEO. It's a short-term disaster recovery plan to keep the institution going until a new, permanent CEO is hired.

"The 'Break in Case of Emergency Plan' is important to have, but it shouldn't be the only plan," Moreno said. "Essentially, it is the proverbial sealed envelope in the board chairman's desk that names the next CEO. It's not adequate by itself."

A true succession plan doesn't just choose internal successors to a credit union's top executive positions; it prepares internal successors, which provides more stability and consistency with the organization's strategic plan. Moreno cited 2011 research from the Krannert School of Management at Purdue University that indicated CEOs hired as part of an organization's internal succession plan tend to stay longer and perform better--for less initial compensation--than the average new CEO.

"It's about building bench strength, to use a sports analogy, and involves staff development rather than replacement," Moreno said. "That requires nurturing and developing people, and it requires active involvement of the board of directors, chief executive and human resources functions."

But even with a true succession plan, credit unions can still lose potential internal CEO successors to competing organizations, including other credit unions. Linking executive development with financial incentives is critical, he added.

"A successful human resources pro is going to look to bring in talent by finding candidates who are already succeeding in other organizations," Moreno said. "Unless you also provide monetary incentives to keep your top talent at your credit union, you run the risk of having your staff poached by others."

That means creating "golden handcuffs" for top talent who could be a flight risk. Doing so makes their decision to leave the credit union difficult, if not costly. Plus, it makes it more expensive for the acquiring organization.

Moreno suggested aligning non-qualified deferred compensation arrangements with a sound succession and development plan. "Part of creating a sustainable ethic of succession is building in a cost, beyond salary, for competitors to acquire your next-in-line executives. A properly structured SERP (supplemental executive retirement plan) adds to a competitor's cost while creating a deferred compensation incentive for your executives to stay."

Executive salaries have increased commensurate with the size and complexity of credit unions over the years. However, tax regulations can limit credit unions' contributions to pension and defined-contribution retirement plans. Executives also face Social Security maximums and potential limitations on disability insurance and corporate-purchased life insurance.

As a result, highly paid executives can expect a much larger gap than other employees between their pre- and post-retirement income.

Moreno suggested considering multiple options for closing this gap. Among these were:

  • "Non-qualified" plans such as a section 457(f) plan. This plan is a promise of payment to the executive under agreed-upon circumstances, such as when the executive reaches retirement age or certain milestones--provided he or she stays with the credit union until that date.
  • A split-dollar life insurance program that can be used with, or instead of, non-qualified plans. This plan uses a combination of credit union-financed premiums, a permanent life insurance policy and the tax treatment of life insurance to provide benefits to executives in retirement.
Due to potential tax and legal risks inherent in a plan design, he advised working with a qualified attorney and experienced providers for any type of non-qualified deferred compensation plans. "As with your entire succession plan, review them regularly so the next time your credit union must replace a top executive, the right person is already on board."

Royce media highlight MBL bill

 Permanent link
MADISON, Wis. (4/23/12)--U.S. Rep. Ed Royce (R-Calif.) and several media outlets highlighted credit unions' push to pass a member business lending (MBL) bill--the Small Business Lending Enhancement Act--before the U.S. Senate this month.

"My bill provides small businesses access to credit they desperately seek by safely raising the member business lending cap set on credit unions," Royce, a sponsor of the bill, said in a featured column in flashreport.com, operated by GOP party official Jon Fleischman and read by politically versed people. "Many of our country's local businesses turn to financial institutions, which are often times credit unions. Nothing beats the peace of mind coming from the familiarity through proximity.

"A 'ma and pa' flower shop looking to expand into e-commerce--creating possible employment for delivery drivers and packers--would turn to their neighborhood institution first before anywhere else," he continued. "Why not give these credit unions, so heavily relied on by local small businesses, the ability to safely supply the demand for credit?"

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.

The Baltimore Business Journal noted Friday that the bill "has become a flash point of contention between credit unions and banks."

The Journal added: "Many credit union CEOs say the legislation would boost jobs by providing another source of credit to small businesses that want to expand and hire more workers. Bankers, on the other hand, counter that credit unions are infringing on their turf and taking advantage of laws that give them an unfair advantage by exempting them from paying corporate income tax."

Raising the credit union MBL cap is good for consumers because it would boost lending by $201 million in Maryland in the first year alone, creating nearly 2,200 jobs, John Bratsakis, CEO of the Maryland and District of Columbia Credit Union Association, told the Journal.

SECU, based in Linthicum, Md., wants to issue more business loans, and there is sufficient member demand to support a raising of the cap, Rod Staatz, CEO of SECU, told the Journal.

Also, Rogue FCU (RFCU), a $542 million asset credit union, based in Medford, Ore., hopes to double its small-business lending by this time next year if the MBL bill becomes law (Mail Tribune April 20).

With no taxpayer dollars involved and capital sitting idle, it makes sense to deploy it, Gene Pellham, RFCU president/CEO, told the newspaper.

Heritage Community CU, a $198 million asset credit union based in Sacramento, Calif., has launched a business lending program, which will offer members business credit cards, commercial real estate loans, and loans for commercial vehicles and equipment  (Sacramento Business Journal April 20).

The credit union is joining a growing credit union movement to expand beyond consumer markets, the Journal noted.

HRTD elects officersWozniak is chair

 Permanent link
MADISON, Wis. (4/23/12)--Diane Wozniak, human resources manager for Tampa Bay FCU, has been elected as chair of the CUNA HR/TD council.

Suzanne Oliver, senior vice president of educational services and chief learning officer for Mountain America FCU in West Jordan, Utah, will become council vice chair. Robert Davis, senior vice president of human resources for VyStar CU in Jacksonville, Fla., will become the council secretary/treasurer.

Oliver also was was re-elected to the executive committee.

Newly elected to the executive committee is Cindy Swigert, chief human resources officer for United FCU in St. Joseph, Mich., who replaces outgoing committee member Kathy Spahr, human resources of training and development director for EECU in Jackson, Mich., who served a three-year term.

Norma Stein, vice president of human resources and learning and development for SchoolsFirst FCU in Santa Ana, Calif., replaces Michelle Greear, assistant vice president of training and career development for Technology CU, San Jose, Calif., who has stepped down from the committee.

The CUNA HR/TD Council executive committee also includes:

  • Robert Carmichael, senior vice president of human resources and training and development for Maine Savings FCU in Hampden, Maine;
  • Jeffrey Duke, organizational development and leadership manager for BECU in Seattle, Wash.;
  • Jennifer Godel, vice president of human resources and training and development and quality for Desert Schools FCU in Phoenix, Ariz.;
  • Jennifer Huggard, director of human resources and accounting for the Northwest Credit Union Association in Federal Way, Wash.; and
  • Roberta Smith, senior vice president of human resources and training for Missoula (Mont.) FCU.

CUs teach financial skills year round too

 Permanent link
PEWAUKEE, Wis. (4/23/12)--While financial literacy is being highlighted across the nation this month, the Wisconsin Credit Union League said credit unions provide financial literacy education throughout the year.

Here are examples of how credit unions teach money management in the state:

  • Youth-run, in-school credit unions. In-school branches teach young people the habit of saving. The branches are considered a "best practice" for youth financial education, said the league.
  • Savings programs. This week is National Credit Union Youth Week, sponsored by the Credit Union National Association. National Credit Union Youth Week invites younger members to save. Last year during Youth Week in Wisconsin alone, 2,950 young people deposited $465,992 into savings accounts.
  • Classroom learning. Credit unions provide the brass student program, which includes the lifestyle money magazine brass, free to Wisconsin high schools. Resources for students and teachers online support state teaching standards. A total of 405 teachers at 350 schools receive it for classroom use. Credit unions also provide free to schools the National Endowment for Financial Education's High School Financial Planning Program, a classroom course teaching personal finance basics.
  • "Experience" learning. Money Mission, offered by through the Credit Union National Assocation, is an online life simulation that challenges teens to balance their life along with their finances. Schools point students to Money Mission to engage their students in financial learning. The program is helping students in 48 states learn the fundamentals of personal finance and has awarded $20,000 in scholarships to college-bound students. This, along with day-long "reality" simulations at local schools, has engaged close to 15,000 students in financial decision-making.
  • Teacher education. Credit unions sponsor local teachers attending the National Institute for Financial & Economic Literacy, held annually in Madison, Wis. The Institute improves financial lessons for tens of thousands of Wisconsin students.
  • Free financial counseling. Credit unions provided almost 30,000 hours of this assistance in 2011 to prevent foreclosures and improve borrowers' creditworthiness. Referrals to classes improve access to checking accounts.
  • Presentations. Credit unions in Wisconsin delivered 5,460 presentations to 34,104 consumers in 2011 to improve their financial savvy on topics ranging from basic financial management to improving credit reports, home buying and more.
  • Events. Some credit unions support Money Conferences, events that teach low-income families financial basics. Other credit unions offer "savings challenges" involving cash prizes. And others offer classes during Money Smart Week.
This week, News Now will provide an update of how credit unions are educating their members during Financial Literacy Month, including National Credit Union Youth Week, April 23-28.

MnCUN honors pro volunteer of year

 Permanent link
BLOOMINGTON, Minn. (4/23/12)--The Minnesota Credit Union Network (MnCUN) announced the recipients of its two most prestigious awards on April 14: the Outstanding Credit Union Volunteer of the Year and the Outstanding Credit Union Professional of the Year.

Dick Nesvold, right, SouthPoint FCU president/CEO, was presented Minnesota Credit Union Network (MnCUN) 2012 Professional of the Year by Mark Cummins, MnCUN president/CEO. Yvonne Condell was honored with the Outstanding Volunteer of the Year Award at the 2012 Minnesota Credit Union Network annual meeting. She is shown with Cummins.
(Photos provided by the Minnesota Credit Union Network)

Health care law changing how CUs offer coverage

 Permanent link
SAN ANTONIO (4/23/12)--Regardless how the U.S. Supreme Court rules on the constitutionality of the Patient Protection and Affordable Care Act or a specific provision mandating that individuals purchase coverage, the health care reform law is changing the way credit unions offer and fund employee health plans, said CUNA Mutual Group Friday at the the CUNA Human Resources and Training and Development Council Conference.

Brad Pricer, human resources process leader for CUNA Mutual Group, discusses how health care law is changing the way credit unions offer and fund employee health plans, at the CUNA Human Resources and Training and Development Council Conference in San Antonio Friday. (Photo provided by CUNA Mutual Group)
That shouldn't prohibit credit unions and leagues from tailoring their benefit offerings and the platforms used for those offerings, Brad Pricer, CUNA Mutual Group human resources process leader, told attendees in San Antonio. "The landscape is definitely changing, but credit unions will be able to take advantage of a post-health care reform environment while controlling costs and maintaining an 'employer of choice' strategy if they so choose," Pricer said.

Health care insurance exchanges are moving forward and will continue to do so regardless of the Supreme Court's decision, which is expected in June. Exchanges are meant to facilitate the purchase of health plans, making the process easier and more efficient.

Pricer said a common question he gets is whether credit unions will still need to sponsor health plans for employees due to the individual mandate (assuming it survives Supreme Court review). The answer is no, but they will have to pay a penalty under "play or pay" provisions. The penalty tax will apply to certain businesses that do not offer health insurance to their employees at certain levels of coverage and affordability, or do not offer it at all.

Employers will likely follow their peers when deciding whether to offer coverage after exchanges are established by Jan. 1, 2014.  A 2011 HighRoads Pulse Survey indicated 80% employers do not intend to drop health care coverage in 2014, but 65% said they would drop coverage if the majority of other companies in their industry did.

"Whether your credit union should continue to provide coverage comes down to whether the businesses you are competing with to attract and retain employees decide to offer coverage or not. If they do, and your credit union discontinues its plan, it will be more difficult to attract and retain talent," Pricer said.

Credit unions that want to continue to promote an employer of choice strategy in attracting and retaining employees by continuing to offer health insurance may need to look at new ways of purchasing that coverage through state-sponsored or private exchanges.

Pricer said purchasing through exchanges and employing a defined contribution approach to funding is gaining momentum. A shift to a defined contribution approach moves the risk of incurring high health-care costs from employers to employees and is similar to the previous shift with retirement plans, he added.

"Instead of providing a set of pre-defined health insurance benefits through one or two employer -sponsored plans, employers will provide a fixed amount of funding. Employees will use that amount in an employer-sponsored exchange to help pay for the level of coverage he or she deems appropriate."

While awaiting the Supreme Court decision, credit unions should not to ignore health care reform compliance requirements, Pricer advised. "In my opinion, it's highly unlikely that all of health care reform will be struck down even if the individual mandate falls."

Either way, credit unions' decision to offer health care coverage in the future will likely be driven by affordability and whether a credit union embraces the philosophy of being an employer of choice to recruit and retain the best available talent.

Pricer encouraged attendees to go to a special website for timelines, legislative briefs, model notices and forms. (Use the resource link.)

Fed Mobile banking rising security still a barrier

 Permanent link
WASHINGTON (4/20/12)--Mobile phones and mobile Internet access are in widespread use, and the ubiquity of the devices is changing the way consumers access their financial services, according to a report commissioned by the Federal Reserve. However, two issues continue to hold back others from adopting mobile financial services.

About 87% of the U.S. population has cell phones, said the Fed's report, entitled "Consumers and Mobile Financial Services March 2012."  

Roughly  21% of those with cell phones used them for mobile banking in the past 12 months, and others plan to--11% of the rest said they  probably will do so in the next 12 months.

Those who used their phones for mobile banking indicated that the most common use was to check  their account balances (90% of mobile banking users did this). The second most common activity: transferring money between accounts, (42% of mobile banking users).

Mobile phones also are changing the way consumers make payments, said the Fed's report.  About 12% of mobile phone users making a mobile payment in the past 23 months, with 47% of those making an online bill payment with their phones and 21% transferring money directly to another person's bank, credit card, or Paypal account.

Two issues, however, continue to plague adoption of mobile banking services: security and a perception of limited usefulness, said the Fed.

Fifty-eight percent of mobile phone users who have not adopted mobile banking yet said that their banking needs were already being met without the use of mobile banking.  Later in the report, however, it was noted that consumers who employ mobile phones to timely financial incentives and emotional appeals about saving time and convenience.

Security was cited as the main reason for not mobile banking by 42% and the second main reason by another 48% . They expressed concerns about hackers gaining access to their phones and their personal financial information and about the costs related to security.

More than one-third of mobile phone users who don't engage mobile banking said they didn't see any benefit from using mobile payments. They also said they found it easier to pay with another method.

Another key finding:  The "underbanked" make significant use of mobile financial services, with 29% using mobile banking and 17% using mobile payments in the past 12 months.  Of the 17% who made mobile payments, 62% did so to pay bills.

Mobile phone use is high among the younger generations, minorities and those with low levels of income--groups that are prone to be underbanked or unbanked, said the Fed.

A lesson for credit unions from this report:  Offering mobile banking  to these groups might be the ticket to developing relationships with new members, especially those in two areas targeted for growth by many credit unions: serving Gen Y and serving Hispanics. But credit unions will have to have the technology to ensure their mobile banking services are more secure.

The survey was administered by Knowledge Networks, an online consumer research company commissioned by the Fed. It took samples of adults ages 18 and 0ver. There were 2,290 respondents who completed the survey. To see the report, use the link.

One dead one injured in shooting in CU parking lot

 Permanent link
CHESTERFIELD, Va. (4/20/12)--One person is dead and another injured as a result of a shooting that occurred in the parking lot of Virginia State University FCU in Ettrick, Va.

Police said Tyrail W. Hughes, 20, of Petersburg, Va., was fatally wounded after he and two other young men confronted a group of four males sitting on a curb near the $11 million asset credit union, said Chesterfield police Capt. David Pritchard (Richmond-Times Dispatch April 18).

Hughes and his friends approached the second group of males, who felt threatened, resulting in a confrontation, Pritchard told the newspaper.

An unidentified male from the second group then pulled a pistol and fired several shots, fatally wounding Hughes. A stray bullet struck an 18-year-old university student who was not involved in the confrontation and happened to be walking by, Pritchard told the paper.

The unidentified student was treated at a local medical facility for a gunshot wound to his foot and released.

Surveillance cameras in the area captured the entire incident, Pritchard told the paper. Investigators are reviewing that footage to identify the participants, he added.

TCUF honors fin. literacy champions

 Permanent link
FARMERS BRANCH, Texas (4/20/12)--The Texas Credit Union Foundation honored the dedication, commitment and hard work of Texas' best financial literacy advocates with its annual FOCUS Awards.

The awards were given during the Texas Credit Union League's 78th Annual Meeting & Convention in Galveston Wednesday (LoneStar Leaguer April 19).

Honored were:

  • Generations FCU in San Antonio in the credit union category;
  • The Fort Worth Chapter of Credit Unions in the organization category; and
  • Kelsey Balcaitis of A+ FCU in Austin, who received a Foundation Focus Network Member award.
Generations FCU was commended for collaborating with private and public schools, as well as colleges and universities to ensure that students of all ages have access to resources and to make smart financial choices. The credit union offers NerdWallet.com, an online financial literacy library, and its "No Suckers Here" employee-driven program that helps students in local high schools, colleges and universities understand basic financial concepts.

The Fort Worth Chapter of Credit Unions earned accolades for sponsoring CU 4 Reality Fairs at two different local middle schools, reaching more than 300 students. Financial reality fairs give young people the opportunity to participate in a hands-on event that guides them through the personal financial management process, including budgeting, saving and investing in a simulated real-world environment.

Balcaitis was recognized for being a dedicated advocate for improving the financial knowledge of young people. Under her direction, A+ FCU operated a Youth Financial Camp for the past two years. In her role as community education specialist, Balcaitis developed the "Business Proposal Challenge" for the credit union's first Youth Financial Camp in 2010. The goal of the challenge is to give campers hands-on experience with being an entrepreneur.

For the 2011 camp, Balcaitis developed the "Great Money Race," an interactive board game that tests campers' financial knowledge and decision-making skills. In 2011, 117 young people attended the summer camp-- a 60% increase from the previous year.

CU System briefs (04/19/2012)

 Permanent link
  • EDINBURG, Texas (4/20/12)--Two people were injured Wednesday when a car plowed into the front glass frame of the Edinburg (Texas) CU.  The incident occurred shortly before noon at the $72 million asset credit union when the driver of the car drove it into the building. Emergency personnel transported a man and a woman to a local hospital. It is not known whether they were passengers in the car or how seriously they were injured. (The Monitor April 19) …
  • ALBANY, N.Y. (4/20/12)--Credit Union National Association Chief Economist Bill Hampel will address credit unions at the Credit Union Association of New York's Annual Meeting and Convention June 9 in Lake George, N.Y.  Hampel's general session presentation will address the current economy as well as key legislative and regulatory issues impacting credit unions. Hampel is senior vice president of research and policy analysis at CUNA. He regularly is interviewed on the economy and credit union issues and has appeared in major national news outlets such as Bloomberg TV and Radio, The Wall Street Journal, MarketWatch, The Associated Press, CNBC, Reuters, CNN, SmartMoney, Dow Jones News Service, Kiplinger's Personal Finance magazine and USA Today, among others ...
  • LOS ANGELES (4/20/12)-- Joseph "Joe" S. Melchione, longtime  credit union attorney and advocate and senior partner of Styskal, Wiese & Melchione (SW&M) , is dead at the age of 64.  He died Tuesday after a battle with lung cancer.  He joined the firm in 1974, and under his leadership SW&M was the first law firm in the nation to specialize in serving the needs of the credit union industry. It grew to serve more than 350 credit unions nationwide. "Joe's unfailing belief in the core values and principles of the cooperative model and its place as an essential consumer service has left a long legacy spanning hundreds of clients and helping shape the industry today," said Bruce Pearson, a partner at SW&M.  A passionate and vocal advocate for the philosophy, ideals and future of credit unions,  Melchione was instrumental in the development of wide-ranging credit union legislation and regulations for more than three decades. He was a well-known speaker in the movement. He was also a faculty member for more than 25 years at Western CUNA Management School. Funeral arrangements have not been finalized but will be posted on www.law4cus.com as details are completed …

CUNA chairman to Texas CUs What you do makes a difference

 Permanent link
"No matter your role at a credit union--you could be a hired strategist or an elected official--the highest form of gratification is to know that what you do makes a difference," Mike Mercer, CUNA chairman and president of Georgia Credit Union & Affiliates, told attendees of the Texas Credit Union League annual meeting Wednesday. (Photo provided by the Texas Credit Union League) 
FARMERS BRANCH, Texas  (4/20/12)--The chairman of the Credit Union National Association  (CUNA) and several other speakers told Texas credit unions that they make a real difference for members at many levels, during the Texas Credit Union League (TCUL) annual meeting Wednesday.

"If you're like most people serving in the credit union movement today, you likely discovered your credit union professional or volunteer career by accident," CUNA Chairman and President of Georgia Credit Union & Affiliates Mike Mercer told attendees (LoneStar Leaguer April 19).

"I was supposed to be a rock star," Mercer said. "But I soon discovered I wasn't very good at it."

Instead, Mercer went to college, studied finance, and by accident, discovered credit unions. "After college, I had planned to go to Wall Street, but I found my passion was credit unions," he added.

"No matter your role at a credit union--you could be a hired strategist or an elected official--the highest form of gratification is to know that what you do makes a difference," said Mercer.

Other speakers gave similar positive  messages. They included:

  • Josh Allison of Horizon CU in Spokane Valley, Wash., who said credit unions are structured to provide real value to consumers. The conditions for success couldn't be better. Consumers today want to do business with a financial institution whose values aligns with their personal values, he added. "It's not about the products and services you provide," Allison said. "It's about the purpose. Great organizations have a cause."
  • TCUL President/CEO Dick Ensweiler, who said that while consumers must understand and be more aware of the credit union difference, they cannot ignore elected officials. "We have to get political," he added. "We cannot allow the banks to dictate our future. We have to take control of our destiny." Credit unions can get more engaged politically, Ensweiler said, by getting more engaged in grassroots advocacy. One example is TCUL's latest initiative, CU: R.O.A.R., which stands for Ready, Organized, Activated, and Responsive. Another is TCUL PAC, which allows Texas credit unions to support those candidates that support credit unions' cause.
  • TCUL Chief Advocacy Officer Tom Haider, who said Senate Bill 2231, the Credit Union Small Business Jobs Bill, is a focal point of key credit union legislative issues. The bill, which will raise the member business lending cap to 27.5% from 12.25% is about credit unions controlling their own destiny, he added. Noting that the bill is the first credit union focused legislation since H.R. 1151, he encouraged attendees to write lawmakers and ask for their vote. "We have to stand united as a movement," Haider said.

Texas 12 crashes league annual meeting

 Permanent link
Members of the Texas 12--a Texas Credit Union League (TCUL) initiative for up-and-coming young credit union professionals under the age of 35--'crashed' the TCUL annual meeting Wednesday. (Photo provided by the Texas Credit Union League)
FARMERS BRANCH, Texas (4/20/12)--Members of the Texas 12 talked about credit union issues with Texas Credit Union League (TCUL) President/CEO Dick Ensweiler Wednesday. The Texas 12 is a new TCUL initiative, involving up-and-coming young credit union professionals under the age of 35.

"We are an aging movement and we need to attract a younger audience," Ensweiler told the group. "To successfully attract younger members, it's important that we have engaged young professionals serving in our movement"  (LoneStar Leaguer April 19).

TCUL should not dictate what the Texas 12 does, but rather the group members should share their thoughts and ideas for making the credit union movement more relevant to young people, Ensweiler said.

The league, in collaboration with the Filene Research Institute, created the Texas 12 to help catalyze change in the system and spark positive growth in the credit union community.

The Texas 12 also will hold a planning session today, and throughout the three-day conference in Galveston, its members will attend educational sessions, social functions and network with veteran credit union leaders.

The Texas 12 members are:

  • Shelby Ames, Liberty (Texas) County Teachers FCU;
  • Kelsey Balcaitis, A+ FCU, Austin;
  • Doug Bedner, Resource One CU, Dallas;
  • Victoria Cline, Neighborhood CU, Dallas;
  • Brittany Doering, Family 1st of Texas FCU, Fort Worth;
  • Kate Donovan, Texoma Community CU, Wichita Falls;
 

  • Chad Holz, University FCU, Austin;
  • Lori Martinez, Houston Fire Fighters FCU;
  • Jana Mearns, People's Trust FCU, Houston;
  • Casey Moehring, Kelly Community FCU, Tyler;
  • Nikki Moore, Space City CU, Houston; and
  • Jamaal Dwayne Robinson, New Mt. Zion Baptist Church CU, Dallas.

Wanted CU global brand identity

 Permanent link
MADISON, Wis. (4/20/12)--
Click to view larger image Participants at World Council of Credit Unions' Build a Brand Workshop include, standing from left, Mary De Sousa, Canada; Lynda Savoit, U.S.; Trish Shermot, U.S.; Rich Harries, Canada; Mark Wolff, U.S.; Daniel McDougall, Australia; Denise Gabel, U.S.; Peter Challis, Australia; Sue Mitchell, U.S.; Nathalie LaChance, Canada; Paula Martin, Canada; and Suzanne Gendron, Canada; kneeling, WOCCU staffers Liliana Tangwell, left, and Tiffany Litscher.
Credit unions have made great strides worldwide from consumers' disillusionment with banks during the recession. However, they still need to better articulate the credit union difference in a way that resonates with consumers, according to an international group gathered by the World Council of Credit Unions (WOCCU) to take the first step toward developing a global credit union brand.

The Build a Brand Workshop, funded by a grant from Vancity CU, Vancouver, B.C., brought together 12 credit union and trade association executives from Australia, Canada and the U.S. earlier this week. Its goal was to identify best practices in current credit union messaging and work together toward a refreshed approach as part of the larger strategy to build a global credit union brand, said WOCCU President/CEO Brian Branch.

"We have learned a lot about changes in consumer preferences, and our members around the world are adapting their messages to today's changing market," Branch said.

In addition to Branch and WOCCU staff, participants included: 

  • Peter Challis, CEO of WAW CU and Daniel McDougall, senior media adviser for Abacus-Australian Mutuals, both from Australia;
  • Suzanne Gendron, vice president of executive services, and Nathalie LaChance, vice president of brand management and public relations, from the Desjardins Group in Canada;
  • Paula Martin, adviser to the CEO of Vancity; Mary De Sousa, assistant vice president of marketing at FirstOntario CU; and Rich Harries, community development manager, Affinity CU, all from Canada;
  • Denise Gabel, chief financial officer and strategy officer for the Filene Research Institute; Sue Mitchell, CEO of Mitchell, Stankovic & Associates; Trish Shermot, marketing manager of CTCE FCU in Pennsylvania; Lynda Savoit, senior vice president and chief operating officer for Orange County's CU in California; and Mark Wolff, senior vice president of communications at the Credit Union National Association, all from the U.S.
Click to view larger image Peter Challis, left, explains marketing challenges Australia credit unions face to Canada's Nathalie LaChance, and World Council of Credit Unions President/CEO Brian Branch.
The session was moderated by Maya Bourdeau and Jiao Zhang, partners of consulting firm Attune LLC.  The group told of these challenges facing credit unions:

  • In Australia, credit unions have worked hard and improved their brand identity among consumers, but some consumers still perceive them as less safe than for-profit financial institutions.
  • In Canada, credit unions have done a good job differentiating themselves, but banks have begun marketing similar social values, and consumers tend not to know or care about the difference.
  • In the U.S., credit unions have made great strides as well as faced great challenges in recent years largely due to social turmoil, which has made the situation for credit unions complex and the resulting marketing messages mixed.
  • In all three countries, credit unions are challenged to attract Generation Y and other younger consumers whose personal values closely match those of cooperatives, but whose communications methods and lack of interest in traditional media make marketing credit unions to them difficult.
Click to view larger image Credit unions need to have a clear voice and clear choice, explained Canada's Mary De Sousa at the World Council of Credit Unions' Build a Brand Workshop. (Photos provided by the World Council of Credit Unions)
Changing consumer behavior is always a challenge, and one made even more complicated by the complex process of changing financial institutions, said Bourdeau.  "People need a compelling reason to switch financial institutions," Bourdeau said, adding, "There is a distinct difference between awareness and action. Action occurs when it can be easily accomplished."

Participants agreed, also citing a need for clear, simple articulation of the credit union difference presented as a benefit to consumers.  "In a world where banks hold us for ransom, we need to have a voice and choice," said First Ontario's De Sousa, herself a former banker.

Bourdeau advised participants to keep their marketing consumer-centric, pitch a solid benefit and choose an engaging emotional hook in their explanations of the credit union difference.  If a messaging strategy incorporates those attributes, the credit union difference has a better chance of resonating with more consumers, including the Gen Ys.

Results from the workshop and the next steps of the brand development process will take place during a session at WOCCU's World Credit Union Conference July 15-18 in Gdansk, Poland, during which the panelists will present the workshop's results.

Franken Pawlenty praise CUs at MnCUN meeting

 Permanent link
BLOOMINGTON, Minn. (4/20/12)--U.S. Sen. Al Franken (D-Minn.) and former Minnesota Gov. Tim Pawlenty  cleared their schedules for credit unions this past weekend to speak at the Minnesota Credit Union Network's (MnCUN) Annual Meeting & Convention. They praised credit unions for their service model and contributions to their communities and Minnesota as a whole.
Click to view larger image U.S. Sen. Al Franken (D-Minn.), left, spoke with Credit Union National Association President/CEO Bill Cheney, center, during the Minnesota Credit Union Network's Annual Meeting April 13-14 about the need to increase business lending.
 

Focusing on credit unions' member business lending (MBL) efforts, Sen. Franken applauded the movement for its commitment to making loans during the financial crisis. He noted that credit unions fulfilled the business lending need during the recession, even when banks pulled back on their lending efforts.

Franken, who is a co-sponsor of the MBL bill in the Senate that would raise the cap on credit unions' MBL to 27.5% of assets from the current 12.25%, expressed his dedication to helping credit unions continue to boost their business lending activities.

"I want you to be able to continue providing capital [to small businesses] and to continue doing that at a more robust rate by raising the cap," Franken said.

In a meeting with Franken, Credit Union National Association (CUNA) President/CEO Bill Cheney thanked the senator for his support of the MBL bill and urged him to encourage his colleagues to also co-sponsor the bill.

Click to view larger image Former Minnesota Gov. Tim Pawlenty told credit unions that small and mid-size businesses are the 'real juice of the economy' during the  Minnesota Credit Union Network's Annual Meeting. (Photos provided by the Minnesota Credit Union Network)
During the conference, Pawlenty provided an insider's look at political campaigns and praised credit unions for the work they do for Minnesotans.

"I'm a member of a credit union, and I'm a very satisfied member," Pawlenty said. "I hope you are proud to be working with and for credit unions. They do wonderful work." 

He also provided credit unions insight into his run for president last year. The campaign trail provides for a very humbling experience as candidates work to persuade a small subset of the population to vote for them, he said. Pawlenty noted that in the end "a very small number of people in a very small number of states get to decide who the major candidates are."

He also discussed the nation's unemployment challenges, budget problems, and the desire to build up the economy. The primary focus, he said, should be on strengthening small businesses, which are the engine of economic growth.

"The answer resides not with career politicians but with entrepreneurs. The real juice of the economy is small and mid-size businesses," Pawlenty said.

CUNA estimates that by raising the MBL cap, credit unions can help inject $13 billion into the economy for small business loans, which would create 140,000 new jobs, without costing the taxpayer a cent.

Irish CU commission report calls for restructuring

 Permanent link
DUBLIN, Ire. (4/19/12)--Ireland's Commission on Credit Unions Wednesday announced its final report, which recommends the credit union movement there undergo a four-year voluntary restructuring process that would include mergers and transfers.

Under the recommendation, a new Restructuring Board would facilitate the process by giving funding to approved credit unions to ensure they have enough money and to upgrade their systems (Irish Examiner and Irish Times April 18).

A tiered regulatory framework would be phased in with less onerus requirements on smaller credit unions, said the commission, whose recommendations were announced in a press conference by Commission Chairman Prof. Donal McKillop.

An operating work team would act as a catalyst, identifying strong credit unions that could act as anchors for other amalgamated credit unions. The decision to engage in the process would be up to each credit union, McKillop said.

He pointed out that 60% of Ireland's population is in a credit union, but the movement had not developed to the extent that it had in the U.S., Canada and Australia. He said he envisioned a long-term consolidation process within the movement. 

Most of the 51 credit unions that had insufficient funds for the required reserves level at the end of 2011 were smaller credit unions.

The Irish Credit Union League (ICUL) said members of smaller credit unions will particularly benefit from the restructuring.

ICUL CEO Kieron Brennan noted smaller credit unions that currently keep limited opening hours and services could offer a broader range of services and hours under the restructuring.

Legislation incorporating the commission's recommendations will be published in late June.

New LCUL member biz council announces 50 members

 Permanent link
HARAHAN, La. (4/19/12)--The Louisiana Credit Union League's new Member Business Services Council (MBSC), which was launched in January, already has 50 members, the league announced.

The MBSC was developed through collaborative efforts of the league and serves credit union professionals in the state who offer member business services such as business lending or are considering offering the services (eNews April 18).

Members are paid staff from affiliated credit unions, credit union service organizations, other credit union-related organizations, and the league.

Since January, the council, under the direction of its Advisory Committee, has developed a members-only website with articles, regulatory guidance, sample documents and other resources, and a members-only e-mail listserv

It also has hosted a webinar with Dennis Dollar on "Is Business the Business of Credit Unions?" and organized a face-to-face workshop, "Growing Your CU Business Services: Coaching Strategies for Sales & Service Success." The workshop will be presented this week in Baton Rouge by Kevin Neufeld of Fusion Performance Group and David Kovacs of Servus CU.

Jenkins to receive AACUC lifetime achievement award

 Permanent link
MADISON, Wis. (4/19/12)--Shirley Jenkins, a long-time active supporter and advocate in the credit union industry, was named the 2012 Pete Crear Lifetime Achievement Award-winner by the African-American Credit Union Coalition (AACUC).

The award is presented annually to recognize a credit union professional or volunteer whose career best embodies the AACUC's mission to "increase the global credit union movement's strength by adding the focused perspective and energy of credit union volunteers and professionals of African-American and African descent."

Jenkins serves as board secretary/legislative chair at the $1.66 billion asset Municipal CU (MCU) in New York City.

In 1983, she was elected to the MCU board of directors, and later became the first female president in the history of MCU.

She was inducted into the Credit Union Association of New York's Hall of Fame in 2005 for her work in promoting the credit union movement locally, nationally and internationally.

Jenkins was a founding member of AACUC and served as vice chair of its board of directors.  

Jenkins will receive the award at a dinner Aug. 3 during the 14th Annual AACUC Conference in Charleston, S.C.

Tech Council paper looks at online account access

 Permanent link
MADISON, Wis. (4/19/12)--Credit unions that seek to meet members' needs for electronic account access must keep pace with the emergence of the mobile lifestyle, according to a new CUNA Technology Council white paper.

The paper explores the mobile lifestyle, in which consumers shift from one electronic device to another as they move from place to place and task to task. Industry experts say credit unions who fail to meet the needs of these members may risk losing their relationships with members.

The report identifies account access options that credit unions should be prepared to offer now and in the near future. Online banking is already an essential service, for example, while mobile banking is likely to become a necessity soon, says the paper.

The experts who shared their opinions and research in the white paper predict that game-changing technology will continue to emerge, which means credit unions cannot afford to become complacent.

Daniel Steere, director of consumer insights at Fiserv, Brookfield, Wis., said Fiserv research into consumer behavior reflects broad trends in three categories that impact the financial sector, especially financial institutions. They are:

  1. Consumer electronic behavior is evolving. "Think about the proliferation of devices: iPhones, iPads, smartphones, tablets, PCs, plasma screen televisions," Steere said. "That's driving so much new and different consumer behavior." As consumers explore their electronic options, their behavior is likely to continue to be shaped by the capabilities of their devices.
  1. Internet connectivity is becoming inescapable. "There's a blurring of lines between being online and being offline," Steere said. "There's going to come a point in time where you're never really offline. Everyone is going to be connected to something that's connected to the Internet."
  1. Societal trends and electronic connections are changing human interactions. Conversations are changing from face-to-face, handshake encounters to electronic interactions through Skype, texting, video chat, Web conferences and other electronic conversations. Digital relationships can become as important as friendships that rely on person-to-person contact. Credit unions need to monitor these "macro trends" as they ponder their products and their connectivity.

CUs in full swing for financial literacy month

 Permanent link
MADISON, Wis. (4/19/12)--Credit unions and credit union organizations nationwide are doing their part to teach their members the value of good financial habits as part of April's Financial Literacy Month.

responses, offering incentives for savings deposits was the most popular selection, followed by Youth Week/Month special activities, and Youth Clubs. The results were:

  • Offer incentives for savings deposits: 61.4%;
  • Hold Youth Week/Month special activities: 59.1%;
  • Sponsor youth club(s): 56.8%;
  • Provide youth newsletter/Webpage: 54.5%;
  • Host financial education sessions for students: 40.9%;
  • Offer student loans: 38.6%;
  • Participate in National Youth Saving Challenge: 34.1%;
  • Sponsor in-school student branch: 18.2%; and
  • Other: 22.7%.
National Credit Union Youth Week and the National Youth Saving Challenge are two events sponsored by the Credit Union National Association (CUNA) in celebration of National Financial Literacy Month.

Credit Union Youth Week is next week, April 22-28. This year's theme is "Be a Credit Union Super Saver."

The Student Life team at Generations FCU, San Antonio, hosted 71 students from San Antonio's Churchill High School for a Financial Scavenger Hunt through the credit union's historic downtown branch. (Photo provided by the Texas Credit Union League)
National Youth Saving Challenge is held during the entire month of April. Last year nearly 146,000 young members deposited $28.5 million into their saving accounts during National Youth Saving Week---with 9,058 new accounts.

Lafayette (La.) Schools' FCU incorporated the Youth Week "Super Savers" theme throughout its branches. With the help of adult marketing postcard art from CUNA, the credit union developed a statement insert promoting its youth rewards savings account to parents and grandparents. Lafayette youth savings account members received a youth week invitation and blank super-hero mask to decorate. The credit union is offering a free coin counter machine, rewards for saving and giving away T-shirts for deposits of $25 or more. Kids can have their photos in costumes holding old-school cloth coin bags. Some of the credit union's front line staff also is wearing own super hero capes.

The Greater Chautauqua FCU, Falconer, N.Y., is again hosting its annual April Youth Month Challenge. The financial institution has about 1,000 child members who can participate in the contest, according to  Kelly Haaksma, Greater Chautauqua FCU chief executive officer. Young members can take three fitness, savings, reading and community challenge activities. Once the children complete the challenges, they will be eligible to enter a drawing for an Xbox 360 with Kinect or a Playstation Vita. In total, there are more than $2,000 in cash and prizes, such as an iPod Touch, bicycles and passes to a Splash Lagoon water park.

In recognition of Financial Literacy Month, Extra CU, Warren, Mich., is offering interactive discussions on understanding credit reports and money management for college bound students during April.

The Student Life team at Generations FCU hosted 71 students from San Antonio's Churchill High School for a financial scavenger hunt through the credit union's historic downtown branch. Students got a behind-the-scenes view of the day-to-day operations of the credit union, working with frontline tellers, visiting the vault and drive-thru teller pod and meeting with Tim F. Haegelin, Generations FCU president/CEO (Texas Credit Union League LoneStar Leaguer April 17).

Generations FCU also will partner with every college in the Alamo Community Colleges district to bring financial literacy classes to their students. MyGenLife will teach more than 25 classes during April at San Antonio College, Palo Alto College, Northeast Lakeview College, St. Philip's College and Northwest Vista College.

In recognition of Financial Literacy Month, Emery FCU, Cincinnati, launched MyMoney, its own financial literacy program. Emery's National Financial Literacy Month celebration--and ongoing MyMoney program--will address financial literacy for adults and children through videos, online and offline content, and workshops and seminars.

Cheney provides national insights at MnCUN meeting

 Permanent link
BLOOMINGTON, Minn. (4/19/12)--Offering a national perspective on the credit union movement's current issues, Credit Union National Association (CUNA) President/CEO Bill Cheney provided Minnesota credit unions insight into successes and opportunities during the Minnesota Credit Union Network's (MnCUN's) annual meeting April 13-14 in Bloomington.

Credit Union National Association President/CEO Bill Cheney speaks at the Minnesota Credit Union Network's annual meeting April 13-14.
Speaking on topics including membership growth, member business lending (MBL) legislation, supplemental capital, and growing regulatory burden, Cheney encouraged attendees to remain engaged credit union champions and advocates.

Credit unions experienced tremendous growth in 2011 and have an opportunity to further distinguish themselves in communities nationwide and on Capitol Hill, Cheney noted. He explained that credit unions' legislative initiatives now are more aggressive and focused on furthering the issues important to the movement, regardless of potential backlash from the banking industry.

"For too long, we let the bankers set the tone," Cheney said. "We're not going to do that anymore."

Cheney outlined how MBL legislation would distinguish credit unions as a strong political force to be respected. Legislation being considered in the U.S. Senate would raise credit unions' MBL cap to 27.5% of assets from 12.25%. The bill would allow credit unions to provide more capital to small businesses nationwide.

"MBL isn't a bank versus credit union issue. It's about small businesses. The passage of this legislation is important--even if your credit union has never made a business loan and never plans to make a business loan," Cheney said.

During the Minnesota Credit Union Network's (MnCUN) annual meeting, Bill Cheney (left), Credit Union National Association president/CEO, provided career insight, wisdom and advice to young credit union professionals who are a part of MnCUN's Crew group. (Photos provided by the Minnesota Credit Union Network)
CUNA and credit unions are urging Congress to increase the MBL cap to open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers.

Cheney also outlined CUNA's efforts to lessen credit unions' compliance burden by representing their interests in conversations with several regulatory agencies, including the National Credit Union Administration and the Consumer Financial Protection Bureau.

Throughout the weekend, Cheney participated in conference events focused on further developing Minnesota credit union professionals and volunteers. During a luncheon on Friday, he sat on a panel of cooperative leaders who discussed how credit unions and cooperatives can more effectively work together.

Cheney stressed the importance of cooperatives developing mutually beneficial relationships that help members. He also cited CUNA's involvement with the National Cooperative Business Association and how their activities help further the development of the cooperative movement.

Also, Cheney provided wisdom, advice and insight to young professionals during a Crew event held in conjunction with MnCUN's annual meeting. The Crew is Minnesota's informal networking group for credit union professionals age 35 and younger looking to grow in their career. Cheney was part of a network of experienced credit union professionals who answered Crew members' questions and provided insight into how young adults can develop and advance their careers.

CU System briefs (04/18/2012)

 Permanent link
  • GREAT FALLS, Mont. (4/19/12)--A Montana man was charged Sunday with the multiple thefts of roughly 530 pounds of change, which he allegedly deposited in a credit union and a bank.  Kyle W. Voss, 24, allegedly burglarized the same home four times within a two-week period, from March 30 to April 13, according to court documents (Great Falls Tribune April 17).  The first break-in netted about $3,000 in quarters and half dollars the homeowner had kept in coffee cans, plastic jars and medicine bottles. In the second break-in, nothing was stolen but the burglar had reopened the coins' hiding places. In the third break-in, on April 12, the burglar took a five-gallon bucket filled with pennies and two large glass jars of nickels, worth about $700 and weighing about 260 pounds, and two hand trucks to transport the load down the street.  Voss then allegedly took 120-pound buckets of pennies to deposit in Wells Fargo and Russell Country FCU, Great Falls.  He was caught after the homeowner installed a motion sensing camera that helped in identifying a suspect, said Cascade County Sheriff's office …
  • FARMERS BRANCH, Texas (4/19/12)--Two Texan mayors--from Amarillo and San Antonio-- will join other city officials in the state to sign an International Year of Cooperatives (IYC) proclamation signifying the critical role credit unions play in their communities. The Texas Credit Union League said Amarillo Mayor Paul Harpole is expected to sign the proclamation on May 22 and San Antonio Mayor Julian Castro is expected to sign it May 24.  League President/CEO Dick Ensweiler will speak at the Amarillo Chapter meeting May 22 and attend the signing. "The proclamation will help raise awareness and understanding of the cooperative nature of credit unions and what that means to consumers--more personalized service, competitive fees and interest rates, as well as the ability to elect their all-volunteer board of directors--no matter how much they have in checking and savings," Ensweiler said. IYC's theme is "Cooperative Enterprises Build a Better World."  Mayors of eight other cities have signed or will soon sign the proclamation in Corpus Christi, Del Rio, El Paso, Fort Worth, Galveston, Houston, Kingsville and Tyler (LoneStar Leaguer April 13) …
  • HIGHTSTOWN, N.J. (4/19/12)--The New Jersey Credit Union League is going digital with its state awards program this year. It will accept applications only via the Web (e-mail, YouTube video and so one) and will conduct judging for the state awards through an online platform that will ask all credit unions to cast their votes for the best. In the past,  a league awards committee made of up credit union leaders chose the award winners.  This year, each league member credit union will be able to view all materials and cast a vote for the winner.  Deadline for entries is the close of business on July 13 (The Daily Exchange April 18) …
  • HARRISBURG, Pa. (4/19/12)--Pennsylvania credit unions and staff from the Pennsylvania Credit Union Association (PCUA) met Tuesday with State Rep. Scott Perry (R-York), a candidate for Congress in the 4th District, at PCUA's headquarters. (Life is a Highway April 18). PCUA President/CEO Jim McCormack and the others briefed Perry, a long-time credit union member, on federal issues and legislation of concern to credit unions.  PCUA said Perry expressed sympathy over credit union regulatory concerns and shared his support of the credit union tax exemption and member business lending. Pictured are, from left:  Nate Muniz, PSECU, Harrisburg; Tim Ames, Heritage Valley FCU, York; Perry; Diana Roberts, Hershey FCU, Hummelstown; and PCUA's McCormack.  (Photo provided by the Pennsylvania Credit Union Association) …

CU staffer ambushed by robber in fair condition

 Permanent link
FORT WAYNE, Ind. (4/18/12)--An employee of Freedom Financial FCU, Fort Wayne, Ind., was in fair condition after being struck several times in the face and head after she was ambushed by a robber Tuesday morning.

The employee was arriving to work before 8:30 a.m., when a man  approached her from behind and made her let him into the credit union (The Journal Gazette and Indiana's NewsCenter April 17).  When she could not open the vault, the man struck her with an unknown object, then fled with some cash from a cash drawer.

A police canine unit tracked the suspect to a parking lot of a nearby apartment complex, where police say he may have had a getaway car waiting.

The credit union staffer was taken to a hospital and is in fair condition, said the police. It was the third robbery at the $8.5 million asset credit union in the past six months. It was also held up on Nov. 18 and Dec. 16, said police.

CU System briefs (04/17/2012)

 Permanent link
  • ALLENTOWN, Pa. (4/18/12)--Two hospital employees have been charged with stealing at least $2,000 by tampering with an ATM owned by Allentown, Pa.-based People's First CU. Alyssa Pascio-Dikaitis, 21, and Camella C. Clarke, 22, both employees of Lehigh Valley Hospital-Cedar Crest as well as next-door neighbors, were charged April 11 with theft, receiving stolen property and conspiracy.  Salisbury Township police and hospital security found that the ATM, located outside the hospital's cafeteria, shut down around the time of each unexplained cash loss. Police said as much as $7,800 was taken from the ATM between September and April.  A video surveillance camera allegedly recorded the two using the ATM just before it sensed an irregularity. The ATM voided the transaction and the machine's statements indicated no money was withdrawn, but the money was dispensed as the ATM shut down (The Morning Call April 16) …
  • DES MOINES, Iowa (4/18/12)--The Iowa Credit Union Foundation (ICUF) announced the winners of its 2012 Family Involvement Board (FIB) Scholarship program. A total of $5,750 in scholarships was given to four high school students and two post-high school students to further their education. Nearly 300 applications were received. Each applicant was required to complete an entry form and write a 500 word essay on the topic: How are you educating yourself on personal finance and money management issues--including how are you using your credit union's financial education expertise? Winners were selected by a panel of judges including teachers and credit union professionals. Scores were based on originality, clarity, meaningful content and accurate presentation of facts ...
  • DOVER, Del. (4/18/12)--Dover FCU has become the first credit union in Delaware to exceed $350 million assets. The credit union closed its books in March with assets totaling more than $363 million. The credit union serves a membership of 37,543. "It's a reflection not only of Dover Federal's strength and stability, but of our members' trust in us," said David Clendaniel, Dover FCU president/CEO. "It's yet another way in which Dover Federal has distinguished itself, and it reaffirms our place as the credit union of choice for the citizens of our great state." Dover FCU was chartered in 1958 …

MBL roundup Landscaper--CU acted when banks would not

 Permanent link
MADISON, Wis. (4/18/12)--More letters to the editor about member business lending (MBL) are rolling in from small businesses and credit unions, and one Alabama credit union has put its case for raising the MBL cap on video by interviewing small businesses it has helped. Here's a recap of those efforts.

A landscaping business owner, in a letter the Des Moines Register (April 17) told how Cornerstone CU made a difference to him and to his employees with an MBL and why credit unions should be allowed to increase their MBL cap to 27.5% of assets from 12.25%.

"When I dreamed of starting my landscaping business, I needed a loan," wrote Martin Ortiz Rangel of  Landscapes by Martin, in Des Moines.  "I went to a bank and was denied.  I didn't have bad credit--I just didn't have any credit.

"A credit union was the only financial institution willing to take a chance on me to build my credit history," Rangel said. "I could tell they believed in me and valued my business plan. I haven't let them down. Landscapes by Martin is now a thriving local business," Rangel said.

He said Cornerstone CU and others are at the cap and may not be able to serve other small business owners unless the Credit Union Small Business Jobs Bill is passed in Congress.  "To each of the employees I've been able to hire, the jobs I've created matter, and those jobs are a direct result of the faith Cornerstone put in me."  He noted raising the lending cap would be good for Iowa's economy.

In Alaska, a letter written to the Alaska Dispatch (April 17) by Al Strawn, CEO of Matanuska Valley FCU in Palmer, Alaska, asks why banks are spreading misinformation about  credit unions wanting expanded lending

Strawn pointed out that "during the recent financial crisis when banks reduced their lending to businesses and individuals by 15% nationally, credit unions recognized the critical need to continue supporting businesses and individuals and increased their lending by 45%. Thus, businesses and jobs were saved. Credit unions have been taking such action for over 100 years."

He suggests that "deep down inside, bankers resent credit unions because of our mission of service."  As for the vote on Senate Bill 2231, "it will be very interesting to see if Congress votes for more service for members or more profits for banks."

Listerhill CU, based in Muscle Shoals, Ala., has produced a video about what it is doing to help small businesses.

In the video, several business owners tell how Listerhill helped them.  Keith and Debbie, owners of All American Swim Supply noted they had approached several different national banks but none would take them seriously because the banks didn't want to finance merchandise.  However, Listerhill "caught our vision. They understood and related to what we were trying to do." Today, All American Swim Supply is among the top 10 largest swim shops internationally.

For their story, and others, check out the video by using the link.

The Credit Union National Association said that if Congress supports the Credit Union Small Business Jobs Bill, it would help inject $13 billion into the economy in loans for small businesses and thus help create 140,000 new jobs, at no cost to the taxpayer.

Study Gas retailers not passing fee savings to consumers

 Permanent link
WASHINGTON (4/18/12)--Although gas retailers in the U.S. are saving $1 billion a year through the subsidy provided by the Dodd-Frank Act's interchange fee provision, they are not passing the savings on to consumers, according to a new study from the Electronic Payments Coalition (EPC).

The interchange amendment to the Dodd-Frank Act has seen interchange rates reduced by 70% for debit card payments for gasoline, said EPC, which is a coalition of banks, credit unions and card networks opposed to the interchange rules. Dodd-Frank capped what retailers pay to accept debit interchange beginning last October.

Nearly 134 billion gallons of gas were sold in 2011, with debit cards used to purchase 48 billion gallons, said EPC, citing statistics from the U.S. Energy Information Administration.  "However, there continues to be no evidence that retailers are passing along savings from this windfall--even at gas stations, where debit is the overwhelmingly most popular form of payment," said EPC.

Half of all non-cash payments for fuel are made with debit cards, which account for 36% of all payments including cash, said the coalition, citing new research by the Phoenix Marketing International.  Among households with income of less than $50,000, debit card share of gas station transactions was twice as high as that of credit cards.

"Given that Congress capped debit card interchange fees at around 23 to 24 cents, gas stations are only paying around one to two cents per gallon on a $50-$75 tank of gas. This is roughly 70% of what they were paying six months ago in debit interchange fees--with no evidence of lower prices as a result," said EPC.

"Wherever Congress meddles in an industry debate over who pays what, consumers never win," said Trish Wexler, EPC spokeswoman. "One side gets a leg up and keeps its windfall, while consumers end up footing the bill." She added that "no one is surprised to see that gas retailers are keeping billions of dollars for themselves, while their customers continue to be punished at the pump. Americans should go to their gas stations and demand what's theirs--a discount for debit."

Consumers can compare the costs per gallon and the interchange rates for credit and debit purchases with its Debit Discount for Gas Calculator to determine the amount of savings retailers should be passing on to them at the pump (Use the link to calculate.)  EPC said the average 16 gallon fill-up paid with a debit card at today's gas prices could receive four to five cents per gallon as a discount.

EPC noted that cash discounts are more prevalent in gas retailing, while discounts for debit--the area the interchange amendment is supposed to subsidize--are virtually non-existent. "Unlike a debit discount, cash discounts lure customers away from the convenience of the pump and into the convenience store, where they are lured into buying items with high mark-ups," Wexler said.

The Credit Union National Association (CUNA) has maintained that capping interchange fees would harm consumers by driving up costs of debit cards, limiting their options, and harming competition and technological innovation. Consumers have not seen any pricing benefits for products and services promised by merchants when they argued for the government-set cap, said CUNA.

Missouri CUs raise 217247 for childrens hospitals

 Permanent link
ST. LOUIS (4/18/12)--Missouri credit unions raised $217,247 in 2011 for Credit Unions for Kids, which benefits the Children's Miracle Network Hospitals, said the Missouri Credit Union Association (MCUA).

Credit Unions for Kids is a nonprofit collaboration of credit unions, credit union chapters, leagues and business partners nationwide that raise funds for the hospitals, the credit union industry's charity of choice. 

"We collect donations at each of our seven branches and have made Children's Miracle Network our primary philanthropic organization," said Kyle Hudson, business development officer for United Consumers CU in Kansas City. "Our mission to help local children and families gives us pure joy and a sense of accomplishment when we hear the stories of young ones who have benefited from Children's Miracle Network's good deeds."

Missouri credit unions have donated more than $2.8 million since the program's inception in 1996. Last year, 62 credit unions in the state took part in fundraising activities that included trivia nights, golf tournaments, bake sales, silent auctions and employee casual dress days.

"This is the third year in a row that we have been honored as a top contributor out of all Missouri credit unions; however, the greatest award is being able to continue our credit union philosophy of people helping people in our community," said Frank Nelson, president/CEO, 1st Financial Federal CU, Wentzville. "We are grateful to have these outstanding hospitals to help our area children when they need it the most."

Missouri is home to five children's hospitals that use donations to adopt life-saving equipment, perform breakthrough research and provide charitable medical care for children. Missouri ranks 12th in the nation for donations raised by credit unions per state, said MCUA.

"Credit unions are always looking for ways to give back to their communities, and Children's Miracle Network provides a phenomenal opportunity to do so," says Mike Beall, MCUA president/CEO.

IWash. PostI CU attracts young members with iTunes

 Permanent link
WASHINGTON (4/18/12)--Money One FCU in Largo, Md., has been attracting younger members for two years through a program that offers free iTunes downloads, The Washington Post reported Monday.

Through its Kasasa Tunes program, members can choose between getting 3% interest on their checking accounts or $10 in iTunes downloads every month.

There are no account balance minimums or monthly fees involved in the program, but members must use their debit card a minimum of 10 times per month and sign up for online banking to receive iTunes.

Because growth in the credit union's checking account activity was stagnant, Money One had to take a different approach, Debbie Connors, Money One president/CEO, told the Post.   

She decided to use BancVue, an Austin, Texas, company that in 2009 created the Kasasa Rewards program to help credit unions and community banks level the competitive landscape with huge banks such as Bank of America and JPMorgan Chase, the newspaper said. 

Having a national brand such as Kasasa helps credit unions and community banks garner more leverage with giant banks, Gabe Krajicek, BancVue CEO, told the paper.

Participating credit unions and other financial institutions pay a monthly licensing fee to access Kasasa software, and also provide some of the advertising budget to BancVue, the Post said.

To read the article, use the link.

European financial experts visit northwest CUs

 Permanent link
OREGON CITY, Ore. (4/18/12)--Financial experts and policy advisers serving nine European Union countries visited Clackamas FCU, Oregon City, Ore., as part of a multi-city fact-finding tour of U.S. financial markets. The delegation wanted to explore the differences between credit unions and banks, and how credit unions navigated the global financial crisis that began in 2008.

The "European Regional Project" participants were invited to the U.S. through the Department of State's International Visitor Leadership Program (IVLP) of the U.S. Department of State's Bureau of Educational and Cultural Affairs (ECA). ECA promotes international mutual understanding through a wide range of academic, cultural, professional and sports exchange programs.

The program was arranged by the World Affairs Council of Oregon, a member of the National Council for International Visitors (NCIV), under the sponsorship of the IVLP.

Countries represented included Bulgaria, the Czech Republic, Germany, Hungary, Latvia, the Netherlands, Portugal, Russia and the United Kingdom. The delegates are employed in high-level roles in their native countries such as advisers to prime ministers, portfolio strategists and parliament members.

The team visited the headquarters of Clackamas FCU, where they saw personal service in action, while credit union members conducted financial transactions in the lobby. They also met with credit union leadership and representatives of the Northwest Credit Union Association (NWCUA), which represents credit unions in Washington and Oregon.

Led by Clackamas FCU President Diann Owen and senior managers of the 26,000-member credit union, the participants learned how credit unions remained safe and sound financial institutions throughout the financial crisis, with well-managed risks and investment strategies.

"The opportunity to meet and engage in dialogue with financial experts from these various European countries" was very worthwhile, Owen said. "It was interesting to exchange financial concepts, models and policies with them, as well as learn more about the credit union structure in their prospective countries."

Owen and the Clackamas FCU team walked the visitors through the cooperative model and gave examples of how member loyalty and service are fostered in their locally operated credit unions. There are no shareholder dividends to pay and each account holder gets to vote for the volunteers who serve on the board of directors, giving local consumers a unique voice in the financial arena, the visitors learned.

"The cooperative financial services model is inspiring to learn about, and even more so when it's possible to see it in action, in a real credit union," said Kasey Rockwell, NWCUA director of outreach programs.

ATM fee-notice lawsuits spread to West Coast

 Permanent link
MADISON, Wis. (4/18/12)--Lawsuits brought against credit unions and banks alleging violations of the ATM-fee disclosure provisions in the Electronics Funds Transfer Act (EFTA) are on the increase again, this time on the West Coast with the latest filed against a credit union in Washington state.

A class action lawsuit was filed Thursday by New York resident Don Anderson--who is also involved as a plaintiff in similar suits in six other states--in the U.S. District Court for the Western District of Washington, Seattle.

This time he sued North Coast CU, Bellingham, Wash., alleging that it charged him for a transaction at its Mt. Vernon, Wash., ATM on Dec. 2, 2011, in violation of the EFTA's fee disclosure provision.  According to the complaint, Anderson alleged that at the time of the transaction, "there was no notice posted 'on or at' the ATM operated by defendant apprising consumers that a fee would be charged for the use of the ATM." He also is alleged to have filed lawsuits in Arkansas, Texas, Louisiana, New Mexico, Oklahoma and Nevada.

News Now reported in December that Anderson had filed ATM fee disclosure lawsuits against four credit unions and nine banks in two states (Dec. 2). The credit unions included: FirstLight FCU, El Paso, Texas; Firestone Community FCU, Bridge City, Texas; Centric FCU, West Monroe, La.; and Monroe Telco FCU, West Monroe, La.

A number of similar suits have been filed by others as well, who travel around the country, looking for ATMs without notices posted on the machines and taking photos of the machines as evidence for their lawsuits. EFTA requires both an external notice physically on the machine as well as a notice on screen informing ATM users of fees charged for transactions. In 2010 and 2011, a retired couple, Nancy Kinder and Ray Harrison of Fowlerville, Mich., filed dozens of lawsuits in Michigan, New Mexico and Texas (News Now May 24).

The rash of nuisance lawsuits has prompted alerts to credit unions about their ATM procedures from CUNA Mutual Group. They also have prompted the Credit Union National Association to alert credit unions and the Consumer Financial Protection Bureau of the increase in lawsuits where ATM notices have been removed, damaged or destroyed (News Now Jan. 3). CUNA also conducted audio conference with CUNA Mutual Group to assist credit unions with the issue.

Credit unions and others have found that the outside notices on ATMs have in some cases been intentionally removed or destroyed without the financial institutions' knowledge.  Earlier this month, Pennsylvania State Employees CU, Harrisburg, Pa., succeeded in getting a court to dismiss an EFTA ATM fee disclosure lawsuit because the credit union showed undisputed evidence that an unknown third party had removed its posted notice illegally (News Now April 6).

However, several other financial institutions have settled the suits with some of the plaintiffs.

CUNA and credit unions have urged Congress to pass a measure to address the nuisance lawsuits filed. (See related story on the introduction of a bill in Congress that would address ATM disclosures in today's News Now Washington section, "Luetkemeyer/Scott bill would address ATM disclosure problems.")

Healthcare CUs form collaborative association

 Permanent link
ANAHEIM, Calif.  (4/18/12)--Fifty credit unions serving the healthcare industry have joined to form the Healthcare Credit Union Association (HCUA).

The HCUA has member credit unions in several states, according to a press release. The group originally began in 2005, led by co-founders Maury Pilver, retired CEO of Healthcare's Cooperative CU, Jacksonville, Fla., and John Saatela, CEO of CarePoint CU, Anaheim, Calif.

HCUA's mission is to promote the growth, viability and unity of healthcare credit unions.

"From the beginning, our vision was simple but powerful," says Saatela. "We wanted to create an alliance of healthcare credit unions to exchange ideas, share resources and discuss the challenges and opportunities that face healthcare credit unions today. We're amazed at how well our colleagues have responded to this collaborative community."

The group seeks to facilitate opportunities for partnership and collaboration among its membership, Saatela said.

The HCUA will conduct a conference Sept. 27-28 in Seattle.

CUs maintain commitment to private student loans

 Permanent link
New York (4/18/12)--Credit unions nationwide remain committed to assisting students and families with higher-education financing through private student loans, while traditional banks have recently been reducing their footprint in student lending. More than 180 credit unions are providing private student loans through Fynanz, a CUNA Strategic Services alliance provider, which provides student loan marketing, education, origination, and repayment solutions for lenders.

Recent announcements by Chase Bank and US Bank to reduce and eliminate their respective private student loan programs is further downsizing an industry that services hundreds-of-thousands of students each year, said Fynanz. Chase Bank will continue to originate private student loans but only for existing Chase customers.

Private student loans are used by students to bridge the funding gap in their higher-education financing after all federal options have been exhausted.

"Private student lending has experienced significant change over the past several years," said Wes Millar, CUNA Strategic Services senior vice president. "Credit unions have created a strong foundation in student lending during this period and will remain steadfast in supporting students and families nationwide."

The majority of credit unions on the Fynanz platform participate in the cuStudentLoans program, which is a private student loan program that is managed and designed by participating credit unions using common underwriting and pricing.

The program, which features the cuScholar Private Student Loan and the cuGrad Private Student Loan Consolidation, includes loan participations to enhance risk mitigation.

Teamwork diligence help Texas branch nab ID thief

 Permanent link
SAN ANTONIO, Texas (4/18/12)--Employees of River City FCU recently used teamwork, diligence and intuition to apprehend an identity theft fraudster with a full-scale operation in the San Antonio area.

A fraudster's complaints about a check-hold procedure during an account opening raised the suspicions of Derek Maldonado, right, a member service specialist at River City FCU, San Antonio. River City Branch Manager Chris Hanson, left, and his team worked with the San Antonio Police Department to apprehend the identity thief within 30 days. (Photo provided by Texas Credit Union League)
"It was a stressful, but we assigned everyone in the branch a role in the event we had the chance to act," Bitters Branch Manager Chris Hanson told the Texas Credit Union League (LoneStar Leaguer April 17).  "There were no questions about what to do when it happened.  We just went to work, because we knew this person would keep trying to cause losses."

In early March, Derek Maldonado, a member service specialist at the $154 million asset River City FCU, had a bad feeling when the fraudster complained about a check hold procedure while attempting to open an account at the credit union.  Fewer than 30 days later, Maldonado's instincts led to the arrest of an identity thief and fraudster.

Maldonado mentioned the member's comments to Hanson, who shared the information with the branch team. When the check was returned due to an unidentifiable account, the team members believed they had seen the last of the member.

However, two weeks later the suspect applied for a loan online. The loan application generated a credit report that showed a fraud alert with a verification phone number. 

The person Hanson called to verify the account said his identity had been stolen, and that he had an active case with the San Antonio Police Department (SAPD) due to the perpetrator's acts of fraud and forgery using his name. 

Also, a branch employee who recently joined River City FCU from another local financial institution realized the same man had created a loss for the previous employer. This information was reported to SAPD.

Hanson and his team worked out a plan to contact police while the perpetrator arrived at the branch to close on the loan. The individual walked out of the scheduled loan closing after becoming restless. The police just missed him. 

A week later, the perpetrator returned unannounced to close on the loan. Again, credit union staff called police. After he walked out again, a teller noticed him parking across the street. When police arrived, he was apprehended attempting to flee.

"If we had not discussed this in advance, the arrest could not have happened so quickly," Hanson said. "We all had phone numbers, license plates, and a visual ID on this person. The only variable we had was how this person would respond, but because we stayed focused, we were able to put this person behind bars. Now his victim has a chance to clear his name."

MnCUN elects directors officers

 Permanent link
BLOOMINGTON, Minn. (4/18/12)--The Minnesota Credit Union Network (MnCUN) held its Annual Meeting & Convention Friday and Saturday in Bloomington where it elected its table officers and board of directors.

More than 330 credit union professionals and volunteers, representing 78 credit unions attended. Also, the meeting welcomed more than 125 individuals from 52 service organizations.

The MnCUN Board elected its table officers for 2012:

  • Chairman--Patrick Pierce, City & County CU, St. Paul;
  • Vice chairman--Chuck Albrecht, Mid-Minnesota FCU, Baxter; and
  • Secretary/Treasurer--Jeff Schwalen, Hiway FCU, St. Paul.




Also at MnCUN's annual business meeting, three incumbent and three new representatives were elected to terms on the MnCUN Board of Directors:

  • Albrecht was re-elected to represent credit unions outside Minnesota's seven-county Metro area.
  • Mary Hansen, Mayo Employees FCU, Rochester, will represent credit unions with more than 10,000 members.
  • Julia Havens, Riverview CU, South St. Paul, will represent credit unions with 2,000 or fewer members.
  • Nick Meyer, Minnesota Valley FCU, Mankato, will represent credit unions outside of Minnesota's seven-county Metro area.
  • Pierce will represent credit unions within Minnesota's seven-county Metro area.
  • Sandra Wiederholt, Ecolab CU, St. Paul, will represent credit unions with 2,001 to 10,000 members.

Former NAFCU chairman Dave Miller dies

 Permanent link
KALAMAZOO, Mich. (4/17/12)--Dave Miller, former CEO of Kalamazoo District Bell FCU, died April 11 in Kalamazoo at the age of 72. He was instrumental in forming the campaign that led to the Credit Union Membership Access Act.

Miller served as chairman of the National Association of Federal Credit Unions for 12 years and treasurer for three years, and was active in state level credit union organizations.

With the late Pete DiSylvester, former Credit Union National Association chairman, Miller was involved in forming the Credit Union Campaign for Consumer Choice,  an advocacy campaign that resulted in the passage of H.R. 1151, the Credit Union Membership Access Act.

The campaign was formed in response to banks winning a 1996 federal appeals court ruling that denied federal credit unions the ability to serve multiple employer groups.  The case went to the U.S. Supreme Court, which upheld the ruling and led to credit unions' advocacy for legislation to preserve multiple group fields of membership.

Among the provisions in the act was the authority for employment-based credit unions to serve more than one sponsor group.

Miller was CEO of the credit union for 43 years until his retirement in 2009.  He also represented the Credit Acceptance Corp. to the Federal Reserve Board.  He is survived by his wife, Nancy; three sons, two sisters and several nieces and nephews (Battle Creek Enquirer via Legacy.com April 13).

No CU damages reported from Midwest tornadoes

 Permanent link
MADISON, Wis. (4/17/12)--More than 120 tornadoes that hit Midwestern states this past weekend left credit unions unscathed.

The twisters hit Saturday and early Sunday in Kansas, northwest Oklahoma, Nebraska and Iowa, killing five people in Woodward, Okla., and injuring dozens (USA TODAY April 16).  Seventy-five percent of the town of Thurman, Iowa, was destroyed.  Neither town had credit unions.

"Over the weekend, the CUMIS Property & Casualty Claims area monitored the severe storms and tornadoes that passed through the nation's midsection," said Phil Tschudy, media relations manager at CUNA Mutual Group. On Monday, "we contacted leagues, CUNA Mutual Group field staff and credit unions in the impacted areas. So far, we have had no reported losses from credit unions, which is certainly good news," he told News Now.

On Saturday nearly 100 tornadoes touched down in Kansas, said the Kansas Credit Union Association. "The good news is, most were in rural areas, and people were made very aware of the severity of the storms and took the necessary precautions," said Susan Dyer, KCUA communications director. "There was damage in south Wichita, and crews are still assessing the situation."

Dyer told News Now, "We have reached out to our credit unions to see if or how they were affected."

It was too early to tell whether the homes of employees or members were among those damaged.

dont use this

 Permanent link

IForbesI CUs a lifeboat for students drowning in debt

 Permanent link
NEW YORK (4/17/12)--"For all those drowning in student debt, a credit union just might be a lifeboat," wrote personal finance writer Sheryl Nance-Nash in an article on Forbes' website (April 13).

Outstanding student loan debt now exceeds $1 trillion, Nance-Nash said, adding that many people may not realize "credit unions are surely worth a look-see."

She interviewed Alice Stevens, chief operating officer of First Financial FCU, Toms Rivers, N.J., who is also chairman of cuStudentLoans, a network of more than 130 credit unions offering a student loan with common underwriting and pricing. Its custudents.org website is powered by Fynanz, a strategic alliance provider of CUNA Strategic Services.

The author pointed out that credit unions are not-for-profit, "so that alone probably means you're going to do better than traditional banks" at refinancing private student loans at lower rates. 

Stevens told Forbes that private student loans from traditional banks, especially between 2008 and 2012, left some borrowers holding interest rates of up to 14%, compared with cuStudentLoans' rates of 4.75% to 7.25%. One student with more than $100,000 in student debt at interest rates up to 14.13% refinanced and saved $8,400 a year in payments.

Nance-Nash cited another "big plus" from credit unions:  a co-signer on  a student loan can help get a lower rate for a student, but a credit union may allow the co-signer to leave the obligation once the student borrower has made payments for 12 consecutive months.

To view the article or to learn more about credit unions' private student loans program, use the links.

Leveraging social media in the MBL battles

 Permanent link
LANSING, Mich. (4/17/12)--The Michigan Credit Union League (MCUL) has been working with credit unions to place stories about the member business lending (MBL) issue in media outlets to draw attention to an impending vote in the U.S. Senate to raise the credit union MBL cap. Social media need to be leveraged in the MBL battles, MCUL says.

Because of social media, readers have the ability to share and participate in the news, and the MBL coverage provides an opportunity to do that, said MCUL (Michigan Monitor April 16).

Credit unions can leverage the current MBL coverage online to reinforce the issue and expand the circle of influence, Jonathan Fuhrman, marketing consultant for CU Solutions Group, who specializes in social media, told MCUL.

"Credit unions can search for the topic on Twitter, and then engage directly with anyone who is talking about it," Fuhrman said. "This can include more mainstream media sources (local news and radio), along with bloggers, or anyone else with a strong influence online.  Perhaps there are local businesses with a strong social media following who could greatly benefit from MBL. You can engage those businesses directly on the issue, then get them to talk to their followers about it," he said.

Credit unions can use the hashtag #raiseMBLcap in all MBL-related Tweets to make it easier for others to search for the topic and share information. Fuhrman added that credit unions can set up Google Alerts for keywords related to the topic, which will alert them each time a new article appears online. Also, consistently post in the story's comment section, which ensures that accurate information and positive comments remain near the top of the comments.

Also, the California Department of Financial Institutions discussed what goals and objectives management should consider in developing a social media plan (Monthly Bulletin March).

Financial institution managers should ensure they cover all applicable social media activities when establishing policies and procedures.

Key elements to address are:

  • Description of the approved social media activities (Facebook, LinkedIn, Twitter, Yelp, etc.);
  • Establishment of responsibility for the social media program oversight;
  • Creation of the appropriate reporting authority;
  • Designation of staff members authorized to manage and respond to social media inquiries and postings;
  • Specification of type of use for social media (business use only);
  • Guidelines for personal use, if allowed;
  • Definition of permitted content (such as communications, product promotions or advertisement, customer education);
  • Inclusion of applicable consumer protection laws and regulations requirements such as deposit insurance and, Truth in Lending, if advertising products and services;
  • Employee training program;
  • Procedures to detail how social media activities are performed;
  • Description of reporting metrics to monitor the social media program's goals and objectives; and
  • Regular review and updates for the policy and procedures.

NCUF opens 2013 Wegner Award nominations

 Permanent link
MADISON, Wis. (4/17/12)--Credit union supporters can nominate individuals and organizations for the 25th Annual Herb Wegner Memorial Awards to be presented by the National Credit Union Foundation (NCUF). The deadline for nominations is June 29.

Winners will be honored at NCUF's awards dinner Feb. 25, in conjunction with the Credit Union National Association Governmental Affairs Conference in Washington, D.C.

"NCUF's Wegner Awards turn 25 next year and the caliber of recipients over the years has been truly remarkable," said Josie Collins, NCUF director of donor relations and resource development. The awards are widely considered the highest national honors in the credit union movement, she said.

Nominations can be made for these awards:

  • The Individual Achievement Award, which honors an unsung hero for innovative concepts and/or accomplishments that have made a significant impact on the national and/or international credit union movements within the past 10 years--or have a significant potential impact now. Nominations must cite a specific subject of achievement, such as financial literacy, service to the underserved, alternatives to predatory lending, and/or new products.
  • The Outstanding Organization/Program Award, which honors an organization or program for innovative concepts and/or products/services that have made a substantial impact with measured results on the national and/or international credit union movements.
  • The Lifetime Achievement Award, which honors an individual who has dedicated his/her life to promoting the credit union philosophy of "People Helping People." This person must have created innovative concepts and provided leadership that has made a significant and lasting impact on the national and/or international credit union movements.
Nominations can come from individuals and/or organizations.  To make a nomination:

  1. Complete the Wegner Awards nomination form on the NCUF website. Use the link.
  1. Gather at least five letters of recommendation citing examples of the nominee's achievements relevant to the award criteria.
  1. Send the nomination form and recommendation letters electronically to NCUF by June 29.
Questions about the Wegner Awards can be directed to Josie Collins at jcollins@ncuf.coop or 800-356-9655, ext. 4374.

Leadership network builds on African womens leadership

 Permanent link
GABORONE, Botswana (4/17/12)--Monique Dunbar, training and development manager for $35 million asset Communicating Arts CU in Detroit, traveled to Botswana last month to participate in the Africa Women's Forum, a Global Women's Leadership Network event jointly hosted by the African Confederation of Cooperative Savings & Credit Associations (ACCOSCA) and the Canadian Co-operative Association.

In Botswana last month to participate in the Africa Women's Forum Monique Dunbar of Communicating Arts CU, Detroit, met Ma Hooud (left), a village elder.
Dunbar went to lead sessions on human resource and training initiatives, but left as a student of leadership, said the World Council of Credit Unions (WOCCU). She brought lessons in staff development and retention to Botswana, but she learned as much as she taught. The transference from teacher to student is something not unusual for forum participants, according to Brian Branch, World Council president/CEO.

"The purpose of the Global Women's Leadership Network is to provide women with an international network that engages them in professional and personal development," Branch said. "We are grateful to Canadian Cooperative Association and to Monique for their work to provide this professional development across borders for African credit union women."

The Global Women's Leadership Network, is an initiative co-founded by WOCCU and the Canadian Cooperative Association (CCA) to bring together women credit union leaders from around the world. Dunbar had never been to Africa before traveling to Botswana.  Nor had she ever met anyone like Ma Hooud, a Morwa village elder and treasurer for the Morwa Savings and Credit Cooperative (SACCO or credit union).

Monique Dunbar of Communicating Arts CU, Detroit, brought lessons in staff development and retention to Botswana, but said she learned as much as she taught. (Photos provided by World Council of Credit Unions.)
"She commands great respect in her village," said Dunbar. "The women I met in Africa are so strong, so proud and so resolute that I came away from the experience inspired to succeed."

Dunbar also worked on building rapport with members and boards of directors and striving to reach consensus to pursue credit union goals and objectives. Communication is key, she explained, stressing the need for listening actively in any discussion or negotiations.

"My primary message to the group was to stay positive," Dunbar said. "It's too easy to see so many conflicting demands as a way to keep you from achieving your goals, but you should never stop trying."

In addition to the U.S. and Canada, the forum was attended by women from nine African nations: Botswana, Gambia, Ghana, Kenya, Malawi, Nigeria, South Africa, Swaziland and Uganda. Dunbar's teachers were many, she said, and their lessons valuable, including an eye-opening view of the mobile banking transaction technology used by SACCO members in Kenya, a program supported by WOCCU.

"Cellphone banking in Kenya is advanced beyond anything we're doing," Dunbar said. "If I could put that work with our members in Detroit, it would be awesome."

Reaching out in ways members need and want to deliver services is critical to success for any credit union or SACCO, Dunbar counseled the women at the forum. Educating staff and members about ways to take advantage of those changes is an important part of training for leadership.

"You don't see a lot of African-American women who are credit union CEOs, but that's not going to stop me from pursuing that goal," Dunbar said. "It's extremely important to me that future generations of staff exceed what I have done and that they, in turn extend their hand to the next in line. I feel that the women I met in Botswana have given me some wonderful examples to take home."

Michigan Texas CUs argue MBL case in media

 Permanent link
MADISON, Wis. (4/17/12)--Credit unions in Michigan and Texas are making a case in the media for increased member business lending (MBL).

The Texas Credit Union League told the story of the Frescas family who sought to open a daycare center and was turned down by 15 banks in El Paso, Texas. Also, when looking to open a bagel shop, Suzanne and John Hermann were turned down by six banks in San Antonio. And Mike McLean, who was a commercial customer at a bank for 15 years, was denied a loan when he looked to expand his successful business, the league said (PR Newswire April 13).

However, because all three entrepreneurs belonged to credit unions, they obtained MBLs for their projects. These small business owners are joining other small business owners in asking U.S senators to vote on raising the MBL cap for credit unions, the league said.

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.

The U.S. Senate is expected to consider the matter soon.

Credit unions in Houston say raising the MBL cap would equate to $152.6 million in new loans in the first year (Houston Business Journal April 13).

In Michigan, bankers have shown during the most recent economic recession that they have not been able to come through for consumers when times became tough, Dave Adams, president/CEO of the Michigan Credit Union League, told The Flint Journal (via mlive.com April 15).

Therefore, "it makes no sense" for lawmakers to restrict credit unions that are willing and able to provide small businesses with much-needed capital, he added.

Michigan credit unions saw a 14% rise in MBL last year, compared with 5% growth nationwide, the Journal said.

To read the article, use the link.

CU Centers re-elects four directors

 Permanent link
INDIANAPOLIS (4/17/12)--Shared-branching vendor Credit Union Centers' (CUC) members recently elected four directors to represent the credit union service organization (CUSO).

Each director will serve a three-year term.

CUC directors represent credit unions based in each of the CUSO's six regions throughout Illinois and Indiana.

The directors, elected at the CUSO's annual meeting, include:

  • Karol Griffin, Teachers CU, South Bend, Ind.;
  • Kristi Lowell, FORUM CU, Fishers, Ind.;
  • Dave Abernathy, Via CU, Marion, Ind.; and
  • Frances Tooley, Finance Center FCU, Indianapolis.
Other CUC directors who continue to serve are:

  • Jill Banning, Regional FCU, Hammond, Ind.;
  • Dallas Bergl, INOVA FCU, Elkhart, Ind.;
  • Chuck Donovan, Members Source CU, Merrillville, Ind.;
  • Doug Harris, Centra CU, Columbus, Ind.;
  • Sue Hejnosz, Credit Union 1, Rantoul, Ill.;
  • Mike Hussey, Tech CU, Crown Point, Ind.;
  • Connie Perry, Eli Lilly FCU, Indianapolis; and
  • Lisa Williams, Pinnacle CU, Fort Wayne, Ind.
CUC comprises 78 credit unions from Indiana, Illinois and Tennessee. The CUSO offers shared-branching services at more than 300 locations in Illinois and Indiana. Through its affiliation with CO-OP Shared Branching, CUC provides member credit unions access to 4,500 locations in 50 states.

Iowa league CEO Tax status is due to ownership structure

 Permanent link
DES MOINES, Iowa (4/17/12)--Credit unions are exempt from federal income tax because of their not-for-profit, cooperative ownership structure and volunteer, elected boards, said Patrick Jury, president of the Iowa Credit Union League, in a recent letter to the editor published in the Des Moines Register.

"Our not-for-profit structure is part of the reason credit unions provide better rates on loans, pay higher rates on savings and charge lower fees to our members," Jury wrote. "In 2011, we saved Iowans more than $68 million through better rates and lower fees."

Jury was writing in response to letters written by John Sorensen, president, Iowa Bankers Association, in the Register and The Gazette criticizing credit union tax status.

"Banker criticism of the credit union tax exemption is highly hypocritical in light of the substantial tax reductions they receive as a result of Subchapter S status," Jury wrote. "Sub S status creates a significant tax break for a corporation that elects it."

Jury cited Credit Union National Association (CUNA) estimates that the 2,311 banks that chose Subchapter S status cost the U.S. Treasury about $700 million. At the end of 2011, there were 203 Subchapter S banks in Iowa and CUNA estimates that foregone federal tax revenue arising from Iowa bank Subchapter S election was $41.9 million in 2011.

"If credit unions were taxed like banks, it would alter our not-for-profit business model," Jury wrote. "Priorities would change, in that the shareholder would end up being more important than the customer."

To read Jury's letter, use the link.

N.Y. CUs league run full-page MBL ad in IN.Y. TimesI

 Permanent link
NEW YORK (4/17/12)--
Click to view larger image Click for larger view
A full-page ad touting raising credit unions' member business lending (MBL) cap was placed in the national edition of The New York Times Sunday by New York credit unions and the Credit Union Association of New York (CUANY). The ad appears in the front section of Sunday's newspaper.

The message of the ad was two-fold, said the association:

First, it was to have New York credit unions and their 4.6 million members commend and thank Sens. Charles Schumer (D-N.Y.) and Kirsten Gillibrand (D-N.Y.) for their leadership in support of S. 2231, the Credit Union Small Business Jobs Bill.

Second, the ad urges the U.S. Senate to pass the bill, which would raise credit unions' MBL cap to 27.5% of assets from 12.25%. The bill, said CUANY, will support small businesses, create jobs for more Americans and build a stronger economy in New York State and nationwide.

"Right now, it is imperative that our senators know we appreciate their continued support and leadership on this legislation," said William J. Mellin, CUANY president/CEO.

"This advertorial will accomplish that goal in a powerful, highly visible way--and it will better position both senators to advocate on our behalf and use their considerable influence with their peers, which could prove absolutely critical once the Senate votes on the bill," Mellin added.

The advertorial was funded by New York credit union contributions to a general MBL advocacy fund, said CUANY.

The national edition of The New York Times has a circulation of 1.25 million and is one of the most highly read newspapers in the nation.

The Credit Union National Association estimates that passing the bill would help inject $13 billion into the economy for small businesses and thus generate 140,000 jobs the first year, all at no cost to the taxpayer.  Congress is expected to vote on the bill soon.

WECU staffer wife killed in marina fire

 Permanent link
BELLINGHAM, Wash. (4/17/12)--A business loan officer at Bellingham, Wash.-based Whatcom Educational CU (WECU)  and his wife were killed when a fire swept through a Bellingham marina on March 30.

The deaths of WECU Business Loan Officer Jim Langei, 43, and Sterling Taylor, 33, were confirmed April 5 by authorities, said the Northwest Credit Union Association (Anthem April 12).

Police had said they received a 911 call indicating the couple was trapped. Langei and Taylor lived aboard their 42-foot boat. The early morning fire destroyed about 10 boats and a boat house at Squalicum Harbor (The Bellingham Herald April 6).

Langei joined the credit union staff in 2003 as a loan officer.  Taylor was also a former WECU employee.

Langei is survived by his parents, Wayne and Kathy Langei, brothers Robert and Tom Langei, and sons Spencer and Ian Langei, all of Bellingham. A joint celebration of life was held Saturday for the couple.

Saskatchewan CUs have record year

 Permanent link
SASKATCHEWAN, Canada (4/16/12)--By generating record-high net income of nearly $92 million, credit unions in the Canadian province of Saskatchewan posted a record year in 2011.

The credit unions also returned $18 million to members through patronage and dividend programs (TheStar Phoenix April 12).

In 2010, credit unions posted a net income of $88 million and returned roughly $20 million to members.

Last year, assets grew 11.3% to $15.6 billion, and deposits rose  9% to $13.8 billion.

Also, loans grew by 10.5% $11.7 billion from $10.5 billion in 2010, with the increase coming mostly from consumer loans--75% of the growth. Loan delinquencies decreased to historic lows of 0.75% in 2011 from 1.09% in 2010. The five-year average is 0.98%.

The numbers reflect a strong business model, Ken Anderson, CEO of SaskCentral, the umbrella organization for the provinces 60 credit unions, told the publication.

As a support organization, SaskCentral recorded a consolidated net income of $27.2 million. Assets grew to $2.2 billion, compared with $1.9 billion in 2010. SaskCentral's return on equity was 8.4 %, compared with 11.8 % in 2010.

SaskCentral is owned by 60 Saskatchewan credit unions that serve about 500,000 members in 270 communities through 303 service outlets.

Conn. CU league annual meeting has record attendance

 Permanent link
MERIDEN, Conn. (4/16/12)--The 78th Annual Meeting of the Credit Union League of Connecticut attracted record attendance of more than 300 participants, including league staff, credit union employees and volunteers, league strategic partners and exhibitors.

Joanne Todd (left), president/CEO, Northeast Family FCU, Manchester, named 2012 Connecticut Credit Union Professional of the Year, receives her award from Tony Emerson, Credit Union League of Connecticut president/CEO.
Held last Tuesday in Plantsville, Conn., the one-day gathering offered more than 50 industry-related vendors, three education sessions, an address by Cardtronics CEO Steve Rathgaber, a luncheon buffet, and a cocktail reception.

Attendees listened to guest speakers covering current hot topics--investing in today's unpredictable economic climate; avoiding pitfalls in establishing core processing agreements; and developments in the ATM industry--as well as the wide range of products and services germane to the credit union industry.

At the conclusion of the annual business meeting, award presentations were made to honor two individuals for their outstanding contributions to the credit union industry: Joanne Todd, president /CEO, Northeast Family FCU, Manchester, was named 2012 Connecticut Credit Union
Rosa Taylor (left) , board chair, Hartford (Conn.) Healthcare FCU, receives her award after being named 2012 Connecticut Credit Union Volunteer of the Year. (Photos provided by the Credit Union League of Connecticut)
Professional of the Year, and Rosa Taylor, board chair, Hartford (Conn.) Healthcare FCU, was named 2012 Connecticut Credit Union Volunteer of the Year.

"It was gratifying to see so many of our member credit unions participate in this annual event with such enthusiasm," said League President/CEO Tony Emerson.

"We wanted to provide a friendly, informative, and professional opportunity--at no cost to attend--for credit unions to network, discuss the state of the industry, and discover the latest in products and services that will help them enhance their service to their own members. Mission accomplished," he concluded.

Pa. CUs familiarize political candidates with CU issues

 Permanent link
Erie (Pa.) area credit unions meet Republican State Senate candidate Janet Anderson at Erie FCU.
HARRISBURG, Pa. (4/16/12)--Pennsylvania credit unions statewide have been initiating early involvement with political candidates to make them familiar with credit unions and credit union issues, according to the Pennsylvania Credit Union Association (PCUA).

Elections bring many opportunities for credit unions to engage with candidates, volunteer for campaigns and build relationships. Early relationship building of this type is how credit unions gain friends in the state General Assembly and some have risen to become members of Congress, PCUA said.

Republican State Senate Candidate for the 49th district, Janet Anderson, met with Erie-area credit unions to discuss issues that are important in the district, and at the state and federal level (Life is a Highway April 11).

Republican candidate for U.S. Senate Steve Welch (fourth from left) meets with a group of credit union leaders at TruMark Financial CU in Trevose, Pa.
Discussion topics included: the Erie airport expansion; keeping jobs and businesses in Erie; the need to match workforce with skill sets; energy initiatives; differences between credit unions and banks; state and federal regulatory burdens; fiscal responsibility; downsizing Pennsylvania government responsibly; urgency to pass the member business lending bill; and data breach responsibility.

Credit union leaders from the Philadelphia and Harrisburg areas met Wednesday with U.S. Senate Republican candidate Steve Welch at TruMark Financial CU in Trevose (Life is a Highway April 6) .

The meeting allowed credit unions to learn more about Welch's platform, share legislative and regulatory concerns facing credit unions, and further educate him on credit unions.

Lonny Maurer, president/CEO of Belco Community CU, Harrisburg, Pa., meets with State House Democratic Candidate Patty Kim. (Photos provided by the Pennsylvania Credit Union Association)
Welch shared his thoughts about the damage of the Dodd/Frank Wall Street Reform and Consumer Protection Act and how he believes it hurts businesses and credit unions. He also expressed his commitment to credit union member business lending legislation (S. 2231) and supplemental capital.

Credit unions in attendance included: TruMark Financial CU; Sb1 FCU, Philadelphia; Fairless CU, Morrisville; Sun East FCU, Aston; Keystone FCU, West Chester; Upper Darby (Pa.) Belltelco FCU ; American Heritage FCU, Philadelphia; PSECU, Harrisburg; and Members 1st FCU, Mechanicsburg.

If successful in the primary election, Welch will face U.S. Sen. Bob Casey in the November general election.

Belco Community CU President/CEO Lonny Maurer recently met with the 103rd State House Democratic Candidate Patty Kim. Kim is running for recently retired Representative Ron Buxton's seat, which is being contested by three other candidates (Life is a Highway April 2).

The meeting allowed Kim to learn more about credit unions and share what she envisions for the district, PCUA said.

Two Maryland educational CUs to merge

 Permanent link
ROCKVILLE/GREENBELT, Md. (4/16/12)--Montgomery County Teachers (MCT) FCU, Derwood, Md., has signed a letter of intent to join Educational Systems FCU, Greenbelt, Md.

The merger would create a combined credit union of nearly $750 million in assets and serve more than 95,000 members to establish one of the largest education-based credit unions in the region, serving educators, students and their families in six Maryland Counties.

"We have found a partner who truly shares a similar history, membership, and mission to help the members of the education community achieve their financial goals and dreams," said Tom Hickman, chairman of MCT FCU with $384 million in assets.

"We welcome the members, volunteers and staff of MCT FCU to our organization," said Rosemary Brinkley, chairman of Educational Systems FCU, with $367 million in assets. "Together, we hope to create the premier financial services provider for the education community."

NCUA WesCorps Swedberg settle suit

 Permanent link
LOS ANGELES (4/16/12)--The National Credit Union Administration (NCUA) and Thomas Swedberg, one of the officials it sued as a result of the collapse of Western Corporate FCU, Wednesday filed a settlement agreement with a federal court in Los Angeles to dismiss the case, according to a stipulation filed Friday.

The documents were filed before U.S. District Judge Margaret Nagle of the U.S. District Court, Central District of California.

A further settlement conference will be conducted off the  record, according to the court document.

Swedberg was the director of human resources for the former $34 billion corporate credit union.

Settlement discussions continue under court supervision regarding the claims of NCUA against defendant WesCorp CEO Robert Siravo, according to the document filed Wednesday.

Swedberg's agreement follows a settlement with Timothy J. Sidley, the former chief risk officer at WesCorp.

WesCorp was hard hit by losses related to mortgage-backed securities. NCUA's lawsuit had alleged that senior WesCorp executives were negligent in monitoring the investments of the corporate and that there was a breach of fiduciary duty and fraud related to investments that resulted in $6.8 billion in portfolio losses (News Now Jan. 24).  The executives filed counterclaims and affirmative defenses against NCUA, alleging the agency was aware of WesCorp's investment strategies and approved of and encouraged the strategies.

Study FIs not promoting mobile banking

 Permanent link
BOSTON (4/16/12)--If credit unions want more of their members to use mobile banking, it might be as easy as asking them to do so. Financial institutions are not adequately promoting their mobile banking offerings, according to a new study.

The ath Power 2012 Mobile Banking Study found that only 10% of consumers using mobile banking were prompted by their financial institution to do so.

This indicates a clear lack of consumer education, yet an obvious opportunity for financial institutions to take initiative to promote their offerings, said Mike McEvoy, managing director of ath Power.

Also, remote deposit capture was the missing feature most sought by consumers, according to the study.

Other key findings:

  • Mobile bankers are more loyal. About one in eight mobile bankers say they'll change banks within two years compared to one in fiveamong the general customer base.
  • The quality of a mobile offering is a major factor in choice of financial institutions among the mass affluent and small business owner segments.
  • The mobile channel is set to play a big role in fraud prevention as mobile adoption improves and consumers become more familiar with alerts.
  • Customer support is lacking. Only one out of five users were offered any option to customize their user interface and 40% failed to find links for technical support.

iWashington Posti article cites credit union-friendly resources

 Permanent link
MADISON, Wis. (4/16/12)--A recent article in The Washington Post on financial literacy resources for teens and families offered three sources with credit union ties.

April is Financial Literacy Month and credit unions nationwide are encouraging their members to budget, save, manage credit, and pay down debt.

In the Post article, the National Endowment for Financial Education (NEFE) was cited as a source for information to help students comprehend the financial world. The Credit Union National Association (CUNA)  has partnered with NEFE to provide financial curriculum to high schools. Use the link.

The article also described Jump$tart as a curriculum-based website on financial responsibility, planning and money management, credit/deb savings and investment. Jump$tart works with credit unions and state credit union leagues nationwide.

Apple FCU, Fairfax, Va., was highlighted for its student-run credit unions and for providing tips on good financial habits for teens.

Credit Union Youth Week, sponsored by CUNA, is April 22-28. This year's theme is "Be a Credit Union Super Saver."

National Youth Saving Challenge, also sponsored by CUNA, is held during the entire month of April. Last year nearly 146,000 young members deposited $28.5 million into their saving accounts during National Youth Savings Week---with 9,058 new accounts.

CU System brief (04/12/2012)

 Permanent link
  • TALLAHASSEE, Fla. (4/13/12)--A U.S. Court of Appeals for the Eleventh Circuit in Tallahassee, Fla., Tuesday upheld the convictions  and sentences of a former credit union CEO and a former Florida A&M University policy institute director on charges of embezzling $134,000 in grant funds from U.S. Department of Housing and Urban Development (HUD) that were administered by A&M University FCU (leagle.com April 10). The court denied the appeals of Eugene Telfair, who was president of the Tallahasse-based credit union, and co-defendant Robert Nixon.  The court said the evidence was sufficient for a reasonable jury to conclude that the two men knowing and willingly conspired to steal, and actually did steal, the grant funds through a wire scheme. The fraudulent contracts occurred between 2004 and 2008 …

DuTrac teams with Walgreens to expand ATM network

 Permanent link
DUBUQUE, Iowa (4/13/12)--Du Trac Community CU has expanded its ATM network through a new partnership with national retailer Walgreens.

Beginning immediately, DuTrac members can withdraw cash and make balance inquiries at ATMs located within any Walgreens store throughout Iowa without paying a surcharge.

Also, the $551 million asset, Dubuque, Iowa-based credit union has begun branding ATMs inside the Walgreens stores in Dubuque and on the Iowa side of the Quad Cities area.

"DuTrac's focus is always finding new and improved ways to serve our members' financial needs," said DuTrac President/CEO Andrew Hawkinson, adding the partnership will provide more ways for members to access cash free of charge.

The new standalone ATMs are typically located just inside the stores' entrance.

DuTrac has an existing partnership with Casey's General Stores throughout eastern Iowa, and is a member of the Privileged Status ATM network.

Ohio CUs preparing to march for hospitals

 Permanent link
DUBLIN, Ohio (4/13/12)--Ohio credit unions are breaking in their walking shoes to prepare for the 2012 "Ohio Credit Unions: Marching Miles for Miracle Kids," which aims to raise $135,000 this year to add to the more than $500,000 they've raised for Ohio Children's Miracle Network Hospitals since 2007.

The Credit Unions for Kids Steering Committee believes the campaign has the momentum to reach the goal, said committee Chair Jaime Crooks of Ohio Healthcare FCU, Dublin.  "We have infused the 2012 campaign with new, unique fundraisers. I think the result will be more involvement on the grassroots level, helping us reach our goal."

Credit union staff, volunteers, members and the general public can participate as marchers or sponsors in the march-a-thon. The first march will be in Youngstown on May 5, with subsequent walks to follow in other areas of the state through May 12. 

Ohio Credit Union League President Paul Mercer noted, "This is another example of how credit unions are making a difference in the communities they serve."

Funds go to local children's hospitals.  Nationally, credit unions contribute to their local Children's Miracle Network Hospitals through Credit Unions for Kids fundraising efforts. For more information use the links.

CUs video in NJ taps into anti-bank sentiments

 Permanent link
PARSIPPANY, N.J. (4/13/12)--Parsippany, N.J.-based Garden Savings FCU has launched a new video pointing out the difference between credit unions and banks. This time, the video taps into the negative press that big banks have attracted since Bank Transfer Day in November.

In the video, which is depicted in a dark setting, a man, in closeup, introduces himself as a bank and outlines a less-than-flattering list of features the bank has for the consumer.

"We realize it's a fairly aggressive video in some respects," Garden Savings Chief Sales Officer Michael Powers told the New Jersey Credit Union League (The Daily Exchange April 12).  "But on the other hand, it's clearly meant to be a little bit over the top and at the end of the day, it does show what we believe to be some clear differentiations between banks and credit unions."

He noted it shows the $206.5 million asset credit union's take on what the perceptions of those differences are from the consumer's standpoint, and "it is meant to call people to action and say to themselves, 'Why am I still banking at a bank?'"

The video in its full form, as well as a 30-second version, will air on county cable television in Morris and Essex counties next month.

To view the video, use the link.

Several leagues report MBL advocacy efforts

 Permanent link
MADISON, Wis, (4/13/12)--As credit unions nationwide step up their grassroots efforts to expand their ability to offer  loans to small businesses, several leagues reported what their credit unions are doing to support the effort.

They are urging Congress to pass Senate Bill 2231, the Credit Union Small Business Jobs Bill, which would raise the MBL cap to 27.5% of assets from the current 12.25%. The Credit Union National Association says that doing so would inject $13 billion into small businesses to help create 140,000 new jobs, without costing the taxpayer a dime.

In New York, credit unions are engaging their members in MBL advocacy and have reported "extremely positive results," said the Credit Union Association of New York (CUANY).  Corning (N.Y.) FCU, for example, obtained 2,256 signatures in two days for advocacy letters to lawmakers on the issue.

On Wednesday, New York credit union CEOs from across the state participated in two MBL conference calls hosted by CUANY. They shared advocacy strategies and discussed the importance of contacting their lawmakers in Congress and recognizing those who already support the measure in Congress.

New Jersey credit union representatives discuss member business lending with Sen. Frank Lautenberg (D-N.J.) during a political event in New Jersey. (Photo provided by the New Jersey Credit Union League) .
Some lawmakers "have been strong advocates of MBL reform, and we know they are being bombarded by banker opposition as a result," said CUANY President/CEO William J. Mellin. He urged New Jersey credit unions to "flood their offices with credit union e-mails, letters and phone calls expressing our appreciation and reaffirming how essential they are to the success of this legislation--legislation that will benefit small business owners, create jobs and help stimulate the economy without any cost to taxpayers."

In Lawrenceville, N.J., credit unions took advantage of an opportunity to meet with Sen. Frank Lautenberg (D-N.J.) to make the case for MBL reform personally. They attended  Rider University's Rebovich Institute for New Jersey Politics' financial session of its 2011-12 Governing New Jersey series, said the New Jersey Credit Union League  (NJCUL) (The Daily Exchange April 12).

Credit Union of New Jersey Director  Gary Chizmadia, Advanced Financial FCU CEO  Alan Feigenbaum,  Hamilton-Horizons CEO Cindy Rein-Zima and McGraw-Hill FCU Marketing Manager Rob Carabelli joined NJCUL Director of Government Affairs Chris Abeel urged supporting the bill comes up for a vote, expected any time after the Senate returns to session on April 16.

"This wasn't a small opportunity," said league President/CEO Paul Gentile. "We need our senators to hear a loud voice here in New Jersey. We're running radio and internet ads, generating lots of e-mails, letters and calls, and have an MBL postcard campaign in full swing. But to have people there to be able to pose the question live and in-person is incredibly valuable for our efforts as we have never before seen such a high level of anti-credit union propaganda coming from the bankers," he said.

Pennsylvania Credit Union Association (PCUA), which sent out a special advocacy edition of its newsletter, Life is a Highway Thursday, noted that representatives from Members 1st CU, Mechanicsburg, including CEO Bob Marquette, met Tuesday with a lawmaker's

regional staff in Harrisburg. They shared statistics on MBL, provided a package of information and delivered copies of letters written by several of the credit union's member businesses.

Mary Beth Wilcher, CEO, of Erie (Pa.)  FCU, and Trent Mason, chief marketing officer, Erie General Electric FCU, also met with a lawmaker's regional office in Erie. They explained the credit union difference and the importance of the MBL legislation. Other meetings with regional staff are in the works with American Heritage FCU, Cross Valley FCU, First Commonwealth FCU, Freedom CU, Penn East FCU, SPE FCU, Sun East FCU, and TruMark Financial CU.

"Come Monday, we will have six of the seven regional offices covered," said a special edition of PCUA's Life is a Highway (April 12).

Wisconsin regulator New business formation up 12.2

 Permanent link
MADISON, Wis. (4/13/12)--The number of new businesses formed in Wisconsin in the first quarter increased by 12.2%, compared with the same period in 2011, according to data released April 9 by the Wisconsin Department of Financial Institutions (DFI). That growth is due in part to assistance from credit unions, said the Wisconsin Credit Union League.

In the first quarter 9,821 new businesses were formed in Wisconsin, compared to 8,752 during the same period in 2011.

March showed a 4.3% improvement over 2011, the 10th time in the past 12 months that new business activity has increased over the previous year, said the DFI, which regulates state-chartered credit unions and banks.

Since the start of the recession in 2007, Wisconsin banks increased their business loans a mere 5%, while state credit unions grew member business loans (MBL) by 52.3% to compensate, noted Brett Thompson, league president/CEO.

"During challenging economic times, many discouraged job seekers are more likely to form businesses," Thompson said. "And that means credit unions that make loans to them are helping 'Main Street' Americans. For example, the Treasury Department found that 25% of credit unions' business loans were made to members with household income of less than $30,000 and another 20% went to households with incomes between $30,000 and $50,000."

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase the MBL cap to 27.5% of assets from 12.25%. Doing so, would inject $13 billion in the U.S. economy for small business lending. That, in turn, would create 140,000 new jobs at no cost to the taxpayer. 

Legislation to increase the cap is active in both the U.S. Senate and the House, and a vote on S. 2231 is expected to take place after Congress returns from its spring recess, said CUNA.

Iowa pizza place owner CUs help fuel American dreams

 Permanent link
DES MOINES, Iowa (4/13/12)--Credit unions are a key to helping small businesses operate, and as such, they should be allowed to provide more loans to small businesses than currently allowed under the federal member business lending (MBL) cap, an owner of several pizza stores in Iowa wrote Thursday in a letter to the editor of the Des Moines Register.

"As a small business owner, I agree with the phrase, 'small businesses are the engine of our economy,'" wrote Brad Loney, who owns Little Caesar's Pizza stores. "I also know my small business engine wouldn't be running without the critical fuel provided by my Iowa credit union. I am the proud owner of pizza-franchise outlets, with locations in Fort Dodge, Newton and West Des Moines. None of this would have been possible had it not been for Community Choice CU [based in Johnston, Iowa]."

Loney wrote that he personally met with nearly every banker in Central Iowa and also sent his business plan to 12 other banks, and was told in each instance that even though his business plan was good, they weren't lending.

"Community Choice reviewed my business plan and saw the potential of my business," Loney explained. "But more important, it understood that I had a dream. It was willing to loan my business money when the banks wouldn't.

"I now employ more than 40 people in Iowa and hope to continue to expand," he added. "Because my credit union experience has been so positive, I've gone back to it for my home loan as well."

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.

To read the letter, use the link.

Tax deadline means extra hours helping members

 Permanent link
MADISON, Wis. (4/13/12)--With the April 17 tax deadline approaching credit unions nationwide are dedicating resources to helping community members prepare their tax returns.

The Wisconsin Credit Union League maintains the website www.freetaxrefund.org, which explains how consumers can access a free refund whether they prepare their own taxes, use a paid tax preparation service, or use a free tax preparation service. The site explains how to use direct deposit to get a no-cost tax refund, where to find free tax assistance sites and what to bring for help with filing.

Each of Wisconsin's more than two million credit union members already has a savings account that can be used to receive a free tax refund, according to the Wisconsin league.

Many credit unions are offering their expertise through the Internal Revenue Service Volunteer Income Tax Assistance (VITA) program and the Earned Income Tax Credit (EITC) program. Also, IRS has a Tax Counseling for the Elderly (TCE) Program offering free tax help to taxpayers who are 60 and older.

VITA offers free tax help to people earning $50,000 or less. It provides trained and certified community and credit union volunteers to help taxpayers access special tax credits and complete their forms. Through the VITA program, credit unions help lower-income consumers keep more of their EITC refunds in their own pockets, according to the National Credit Union Foundation's REAL Solutions VITA site.

Taxpayers who qualify can claim the EITC credit and could pay less federal, tax, no tax, or get a tax refund. The credit is for low-income working families to offset the burden of Social Security taxes and provide an incentive to work (News Now Jan. 30).

GHS FCU, Greenville, S.C. used volunteer tax preparers from Broome Community College to assist with its VITA program for low-income families (Press & Sun Bulletin March 29).

In a Pennsylvania Credit Union Association Highway Quick Poll, 40%, or 32, of 80 responding credit unions said they are offering VITA services this year (Life is a Highway Feb. 17).

Responding Pennsylvania credit unions also offered feedback on how they would provide tax preparation services. Responses included:

  • 84% said they will use certified employees to prepare tax forms in branch;
  • 45% said they will serve all eligible consumers;   
  • 22.6% said they will provide free space for VITA volunteers in branch;
  • 9.7% said certified employees will prepare tax forms at other locations; and
  • 6.5% said they will serve only eligible members.
The $876 million asset Georgia United CU, Duluth, Ga., is partnering with IRS and the College of Family and Consumer Sciences of the University of Georgia to provide its VITA program.

State Employees' CU, Raleigh, N.C., will operate its VITA until April 17. It has offered the VITA service for four years and its own low-cost tax preparation service for consumers earning more than the $50,000 VITA annual income cutoff for two years. In 2011, SECU tax preparers filed more than 53,000 returns, with members receiving $82 million in refunds and saving $7.9 million in tax preparation fees.

For the ninth year, the $4.2 billion asset Bethpage (N.Y.) FCU is helping low- to moderate-income households on Long Island through the VITA program at 12 of its branches. Bethpage FCU is making available 150 IRS-certified volunteers, including bilingual tax assessors, to members and nonmembers.

Royal CU, a $1.2 billion asset credit union in Eau Claire, Wis., is among the credit unions offering the VITA program. Royal CU offers assistance filling out basic tax forms (1040EZ, 1040A and 1040). Volunteers are University of Wisconsin-Eau Claire and Chippewa Valley Technical College accounting students certified by the IRS, says RCU's website (News Now Jan. 31).

More than 100 Michigan credit unions are offering Just File It, a web-based program that allows individuals and families to file for state and federal tax credits that might otherwise be overlooked, said First Community FCU, Parchment, Mich., one of the credit unions offering the program. The program uses a free, online software program that poses questions to users and offers assistance via online chats. The technology was development by the Legal Aid Society of Orange County, California.

Oregon Community CU, Eugene, Ore., is again offering the use of a meeting room and equipment to host a Tax-Aide site for the AARP Tax-Aide program. The credit union's South Eugene branch is serving as a Tax-Aide through Saturday. Tax-Aide is available to all taxpayers with low to moderate incomes, with special attention to those ages 60 and over. Membership with AARP is not required.

North Side Community FCU, Chicago, offered free and reduced rate tax preparation services on April 5 and April 12 to both members and nonmembers.

For tax filers fortunate enough to get a refund, Nino Gemma, CEO of Stark FCU, Canton, Ohio, offers these recommendations for making good use of the funds (CantonRep.com April 2):

  • Build an emergency fund;
  • Pay off credit cards;
  • Make a down payment;
  • Start a college fund; and
  • Invest in home improvements.
See related story, "Last-minute tax tips on H&FF Radio," in News Now's Consumer News section.

San Antonio business owners CUs urge lifting MBL cap

 Permanent link
SAN ANTONIO (4/13/12)--San Antonio small business owners united with credit unions in the Texas community Wednesday for a joint press conference at Freetail Brewery Co. to call on lawmakers to support the measure before Congress to raise credit unions' member business lending (MBL) cap.

San Antonio  business owner and Generations FCU small business lending member Kathy Carrizales talks to a local Univision reporter about the need to raise credit unions' member business lending cap to infuse more business loans into the economy. (Photo provided by Generations FCU)
They urged support of the Small Business Lending Enhancement Act (S. 2231), which would raise the MBL cap to 27.5% of assets, up from the current 12.25% of assets.

"Ninety percent of small business owners have indicated that access to capital is a significant issue for them, hindering them from growing their business and hiring new employees," said Tim F. Haegelin, Generations FCU president/CEO. 

"Fifty percent of Americans work for small business owners," Haegelin said. "At a time when our country is struggling to get its economy back on track, it doesn't make sense to limit responsible growth that will enable these individuals, who are the backbone of our communities, to hire workers and expand their businesses," he added.

The press conference was attended by numerous San Antonio small business owners as well as Generations FCU, Firstmark CU, United SA FCU, and Randolph-Brooks FCU.

Each of the small business owners had approached multiple banks but was unable to obtain necessary funding to grow and expand its business. However, all later received funding from their local credit unions.

The Credit Union National Association estimates that passage of S. 2231 would infuse $13 billion into the economy and create roughly 140,000 jobs nationwide. According to the credit unions present at the conference, that would include more than 8,500 jobs in Texas alone, at no cost to taxpayers and without expansion of government. Also, banks would still keep about 90% of their market share of business loans.

"The average credit union business loan is a little over $200,000," said Haegelin. "These are quite literally the loans that banks do not want to make because [the loans] are too small and because it doesn't provide enough return on investment for [the banks]."

"As not-for-profit financial institutions, credit unions can make these smaller loans. And that helps the local nail salon owner or air conditioning repairman buy equipment, expand their business and hire more workers, putting our community and our economy back to work," Haegelin said.

The vote on the S. 2231 is expected within the next two weeks.

Pa. banking dept.s new outreach unit meeting with CUs

 Permanent link
HARRISBURG, Pa. (3/12/12)--The Pennsylvania Credit Union Association met Tuesday with two members of the Pennsylvania Department of Banking's new business unit, the Office of Client Financial Services, which aims to provide proactive outreach to the state's financial services companies.

Two members of the unit's Area Executives Team, Donna Riling and Becky MacDicken, visited PCUA's headquarters in Harrisburg and reviewed the new initiative with PCUA President/CEO Jim McCormack and Senior Vice President Mike Wishnow (Life is a Highway April 11).

During the next few weeks, the team of six Area Executives will visit credit unions across the state to gather information on the state of the economy and regulatory issues facing financial institutions. They will call on both state-chartered and federally chartered credit unions to take back detailed information to Banking Secretary Glenn Moyer, PCUA said.

"We welcome this Relationship Manager program and the efforts of the Area Executives team [members], as they collect regulatory feedback from credit unions and other regulated institutions," said McCormack. "Working together, we can help the department develop fair and consistent regulatory policies for all financial institutions," he added.

Riling works in the Western area and MacDicken in Southcentral. Other Area Executives are: Dick Moriarty, Central; Felix Zorrilla, Northcentral; Rosemary Garland, Northeast; and Kevin Pyle, Southeast.

CUs auto lending market share at 17.4

 Permanent link
ONTARIO, Calif. (4/12/12)--After hitting a monthly low of 15.2% in March 2011, credit union auto lending market share has climbed, maintaining above 17% each month since May 2011, according to CUDL's quarterly Auto Lending Trends & Credit Union Analysis.

CUDL, part of Ontario, Calif.-based CU Direct Corp., presented the findings in a webcast March 27 that outlined key metrics on auto financing trends for credit unions and competing financial institutions, provided a fourth-quarter 2011 credit union auto lending market analysis and discussed auto manufacturer and sales trends.

Among the highlights presented by Andrea Salgado, market research analyst for CUDL:

  • Credit unions' auto lending market share year to date (as of the end of January), is at 17.4%.
  • Auto loans represent 29% of the average credit union loan portfolio, as of year-end 2011. In unit volume, however, auto loans make up the largest portion of all loans in the credit union portfolio, at 32%.
  • CUDL credit unions, with more than 990 credit unions nationwide, are the seventh largest lender of auto loans as of the end of January, with more than 44, 255 loans financed on the CUDL Platform, with year-to-date growth at 39.7%.
  • CUDL credit unions increased  unit  loan volume 40% in both January and February.
  • Credit union auto loan delinquency balances shrank by nearly 20% between year-end 2010 and year-end 2011 and credit union charge-off rates for these are still below 1%.
The webcast noted that new- and used-auto sales rose through February, with new-car sales up 14% and used-car sales up 10%. Credit union indirect loans outstanding totaled $71 billion in 2011, less than the $71.7 billion in 2011.

To view a PDF presentation or a video of the webcast, use the resource links.

Two conferred with Annie Vamper awards

 Permanent link
NEW YORK (4/12/12)--The National Federation of Community Development Credit Unions announced the 2012 recipients of the Annie Vamper "Helping Hands" Award, the highest honor given by the federation to community development credit union (CDCU) staff and volunteers.

The awards celebrate the organization's late Associate Director, Annie Wilma Vamper, whose lifelong dedication to the credit union movement, and to small credit unions in particular, served as inspiration to many low- and moderate-income people and communities nationwide.

"It's also a testament to the diversity of the CDCU movement that these two honorees from vastly different credit unions, one with less than a million in assets, and the other quickly approaching the one-hundred million milestone, should be honored in the same year," he added, noting that "credit unions of all sizes can make important and indelible contributions to their communities, and these two honorees demonstrate this reality."

Conner joined the credit union's board more than 25 years ago. Most recently, as chairman of its delinquent loan committee, he has taken the collection of delinquent loans to new heights, managing to reduce the delinquency rate from over 26% at its highest point, to nearly 0% now.

He and his committee work non-stop contacting credit union members directly, sending notices and letters, and occasionally making personal visits to members' homes or place of business to collect payments.

In 1983, Godfrey-Smith became CEO of Shreveport FCU and built the $1.9 million credit union into an $88 million CDCU operating seven branches, with an eighth branch planned. 

Godfrey-Smith has also selflessly shared her knowledge with others, traveling nationwide and worldwide mentoring credit unions. In addition to her work domestically, she has traveled to South Africa, Trinidad and Tobago and other locations outside the U.S., helping credit unions survive and thrive. 

In late 2009, she convinced her board to merge a troubled credit union in the impoverished Mississippi Delta region, the First Delta FCU, a historic CDCU founded during the Civil Rights movement. The merger maintained crucial services in a community with few regulated financial institutions. Since taking in that credit union, Shreveport FCU has expanded its service to other parts of the Delta and operates three branches in Marks, Miss.; Clarksdale, Miss.; and Batesville, Miss. Under her management, the Mississippi credit unions have doubled in both assets and loans.

In 2010, Godfrey-Smith partnered with the City of Shreveport to open a Community Empowerment Center to deliver affordable financial services while offering training, counseling, job readiness and business development to low- and moderate-income residents. A second center is scheduled to open in Shreveport later this year, with a third being planned in Mississippi.

Conner and Godfrey-Smith will receive their awards at a special ceremony June 15, during the federation's 38th Annual Conference on Serving the Underserved in Atlanta. For more information about the event, use the link.

Similar CU names prompt lawsuit

 Permanent link
AKRON, Ohio (4/12/12)--A name change for a Pennsylvania-based credit union serving members in Ohio and Pennsylvania has prompted a lawsuit by an Akron, Ohio-based credit union with a similar name, alleging the change violates federal trademark infringement and other unfair competition laws.

FirstEnergy Family CU, a $38 million asset credit union in Akron, Ohio, filed the suit Tuesday in the U.S. District Court  for the Northern District of Ohio, Eastern Division, against Greensburg, Pa.-based, $56 million asset FirstEnergy FCU, which  changed its name Jan. 1 from Allegheny Energy FCU.

The Akron credit union 's complaint said it has used its service mark FirstEnergy Family CU since at least May 22, 1998, and it has invested "significant resources" into using the name in its products and services offerings and its advertising and marketing. It also has referred to itself as FirstEnergy FCU, and/or FEFCU.

The Pennsylvania credit union does business in Northern Ohio, was aware of the other's use of FFCU when the name change occurred and did not obtain authorization from FFCU to use the FFCU service marks, the suit alleged. The suit alleges damages, but did not specify an amount.

"The actions of Allegheny …are likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection or association of Allegheny with FFCU, or as to the origin, sponsorship, or approval of Allegheny's goods, service or commercial activity," said the court document.

The Ohio credit union is seeking temporary and permanent injunctions against the use of "FirstEnergy Family CU," "FirstEnergy FCU," "FEFCU," and any other similar marks that may cause confusion . It also is seeking destruction of all materials bearing the new name, removal of all Web pages with the name, and a written report on how the credit union is complying.

FirstEnergy Family also asked for damages to be trebled and for any profits the other credit union had made as a result.

The Pennsylvania credit union, on its website (April 11), noted that a recent expanded membership charter allows it to offer services and membership to all FirstEnergy Corp. employees and their families, since Allegheny Energy Inc. was acquired by FirstEnergy Corp. 

In it FAQ section about its new name, it said it "will also go by the abbreviated name FirstEnergy FCU." It advised members not to make checks out to the credit union as FEFCU, but they could write them to FirstEnergy FCU.

CU System briefs (04/11/2012)

 Permanent link
  • DARIEN, Conn. (4/12/12)--A Turkish man living in New York pleaded guilty Monday to one count of conspiracy to commit bank fraud and one count of aggravated identity theft by using ATM skimming devices. Ahmet Cilek, 42, a citizen of Turkey who last resided in Levittown, N.Y., was charged for his role in ATM skimming across southern New England (Darien Times April 9). The skimming devices were installed between February and July 2011 on ATMs at 11 banks and one credit union in Connecticut, Massachusetts and Rhode Island. Cilek and co-conspirators allegedly also placed devices on ATMs that contained hidden pinhole cameras that recorded personal identification numbers that members and customers used to access their accounts. More than 250 bank accounts were victimized, and financial institutions lost more than $336,057, according to court documents.  Cilek, who was one of several who have been charged with the skimming schemes, faces up to 30 years in prison and up to $1 million in fines.  His sentencing has been set for July 2  in New Haven …
  • RIVERSIDE, Calif. (4/12/12)--Volunteers from Altura CU helped students at Lisa J. Mails Elementary School
    Click to view larger image Click for larger view
    in Murrieta, Calif., attempt to achieve a new Guinness World Record for Largest Art Lesson in a Single Venue.  In March, more than 1,000 crayon-toting students gathered with teachers, parents, grandparents and volunteers, including volunteers from Altura, The official count: 1,103 participants, surpassing the record set by 879 participants last September by a school in London. Altura, whose history is linked with school employees, tries to assist local educators and schools when possible with donations of time, supplies and money. Four Altura volunteers monitored a class of students as part of the documentation process required by Guinness, said Trisha Rudd, Altura business development officer, who volunteered.  They watched students once the lesson began and made sure they participated throughout the lesson. They then wrote and signed a statement of their observations, which is submitted to Guinness as part of the school's application for the record. (Photo provided by Altura CU) …
  • VIRGINIA BEACH, Va. (4/12/12)--Following the excitement of the recent mega millions jackpot, Chartway
    Click to view larger image Click for larger view
    FCU's We Promise Foundation hosted a special sweepstakes to support local children facing life-threatening illnesses.  The contest, in which entrants had a one in 1,500 chance to win free groceries for a year, raised $29,800.  Joining the We Promise Foundation to pull the winning ticket were six local children whose dream of visiting Disney World came true, thanks to the local charity and the support of Toby's Dream Foundation. They received a worry-free, week-long escape to Disney World and joined in presenting a grant totaling $101,600 to Toby's Dream Foundation to change the lives of 20 young fighters.  Pictured are We Promise Children Erick, Delvery and Dakari helping We Promise award the $101,600 grant to Joan Steele, executive director of Toby's Dream Foundation. In the background are Rick Lieberman, Chartway vice president of lending; and parents of We Promise children Jessica Renda, Jamie Hooks, Briston Tutwiler and Kristen Germroth.  Use the link  for a video of the event.  (Photo provided by Chartway FCU and We Promise Foundation) …

CMG risk manager CUs among targets from breach

 Permanent link
MADISON, Wis. (4/12/12)--The number of credit unions affected by the Global Payments data breaches could number into the hundreds, though the exact number or amount of fraudulent transactions is not yet known, said a CUNA Mutual Group security expert.

"One credit union has more than $100,000 in fraud, and some have zero," said Ann Davidson, CUNA Mutual Group risk manager. "It's in that window."

The University of Iowa Community CU has recalled 200 cards from account holders as a result of the Global Payments breach (Daily Iowan April 11).

Visa and MasterCard continue to expand the window during which the data breach occurred. As of Wednesday, Visa reported that the breach occurred between Dec. 12 and Feb. 25. MasterCard has said it could have begun as early as Dec. 3.

"I don't think anyone really knows how far back this is going to go until the investigation has been completed," Davidson told News Now.

Credit union fraud prevention practices such as system monitoring and daily limits are among the best in the financial services industry, but the level of trust members have for their credit unions can make them easy victims of social engineering scams, Davidson said.

"Members have to be ever so cautious and never give out any personal financial information," she added. "That can't be emphasized enough."

U.S. financial institutions are among the last in the world to adopt the more secure chip technology for debit and credit cards. Magnetic stripe technology is much more vulnerable to fraud, Davidson said.

On Wednesday, CUNA Mutual issued a risk alert to its bondholders advising them to move forward with chip technology.

"Implementing chip technology (point-of-sale and ATM terminals) will significantly reduce magnetic stripe counterfeit fraud and improve the overall security of the U.S. payment infrastructure," the CUNA Mutual risk alert said. "Chip security provides a number of benefits, including authentication of cardholders and transaction authorizations based on issuer defined rules."

WOCCU welcomes new members from Colombia Moldova

 Permanent link
MADISON, Wis. (4/12/12)--World Council of Credit Unions (WOCCU) last week welcomed Colombia and Moldova as new members.

Click to view larger image The World Council of Credit Unions (WOCCU) last week welcomed Colombia and Moldova as new members. WOCCU Chair Manuel Rabines, CEO of the National Federation of Credit Unions of Peru, left, welcomes Cooperativa Médica del Valle and Jose Luis Blanco Saenz, its corporate manager for strategic planning and marketing, as a WOCCU associate member.
The WOCCU board approved Cooperativa Médica del Valle (COOMEVA), a cooperative financial holding company from Colombia, as an associate member.

The board also approved Central Association of Savings and Credit Associations (CASCA), Moldova's credit union trade association, as a direct member.

Applications from both organizations were approved during WOCCU's first-quarter 2012 board meeting in New York.

"The global credit union movement continues to grow thanks to the good work of organizations like COOMEVA and CASCA," said Brian Branch, WOCCU president/CEO.

COOMEVA, based in Cali, Colombia, provides health services, mutual insurance, investment, savings and lending services to 250,000 members. COOMEVA heads a group of 16 companies with $2.8 billion assets. The organization is one of a growing number of World Council associate members.

Click to view larger image Ion Gangura, standing, chairman of Central Association of Savings and Credit Associations, Moldova's credit union trade association, moves to apply for World Council of Credit Unions membership at the organization's annual general meeting as Efim Lupanciuc, CASCAs chief executive officer (far right), looks on. (Photos provided by World Council of Credit Unions)
CASCA was formed in 2009 by Moldova's 49 largest credit unions. Its affiliates control 42%, or $12.7 million, of Moldova's credit union assets and account for 32%, or 40,735, of the country's credit union members. CASCA, provides representation, training and liquidity management services for its members.

"We see the continued growth of our organization as a sign of confidence not only in the work we do, but also in the global credit union movement," said WOCCU Chair Manuel Rabines, CEO of the National Federation of Credit Unions of Peru. "Such support signals a brighter future for us all."

Representatives from CASCA and COOMEVA will be formally recognized at the WOCCU 2012 annual general meeting, which will be held in conjunction with the organization's World Credit Union Conference, July 15-18 in Gdańsk, Poland.

SECU ATMs save 8M for unemployed child support recipients

 Permanent link
RALEIGH, N.C. (4/12/12)--With nearly 1,100 no-surcharge ATMs located throughout North Carolina, State Employees' CU's CashPoints ATM network is saving the state's unemployment and child support beneficiaries more than $8.4 million in ATM transaction fees annually, with nearly three million transactions each year.

As North Carolina's unemployment rate continues to hover around 10%, recipients of unemployment benefits rank top among non-member use of CashPoints services. In the past year these recipients, who receive their claims payments via an Employment Security Commission debit card, performed more than 1.8 million transactions at SECU machines. The no-surcharge SECU CashPoints network saved this user group more than $5.4 million.

Also, child support recipients performed more than one million transactions on the CashPoints network during 2011. And military personnel performed nearly one million additional transactions at CashPoints machines in the past year.

SECU in 2010 signed bi-lateral agreements with four military-based credit unions. Under this agreement, SECU military members also have no-surcharge access at ATMs owned by several defenses credit unions in the state, providing a worldwide benefit for these members.

"A goal of our not-for-profit cooperative is to help keep money in the pockets of members, while also providing an overall economic benefit to all citizens of our state," said Leanne Phelps, SECU senior vice president of card services. "A no-surcharge benefit of $8.4 million to these groups in great need of support is doing just that."

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

Interra member turn 80 together

 Permanent link
GOSHEN, Ind. (4/12/12)--Interra CU, Goshen. Ind., celebrates its 80th anniversary in 2012. One Interra CU member can say she's been with the credit union for every one of its--and her--80 years.

Interra CU will celebrate its 80th anniversary this year. Harriet Bainter, who will celebrate her 80th birthday this year, has been a member of the credit union since its inception. Pictured are Jack Sheets, Interra CU president, and Bainter at the credit union's 75th anniversary in 2007. (Photo provided by Interra CU)
Harriet Bainter was born in 1932, the same year six men and one woman deposited $19.50 to charter Elkhart County Farm Bureau CU. Bainter's uncle, Burnette Burkey, was one of the founding members.

As a gift to his niece, Berkey opened a savings account for her. The board report of March 1932 shows that her account had a balance of 75 cents.

In 1970, Bainter became the credit union's third full-time employee, and worked in that capacity until 1985. After that she spent her winter months in Arizona, and worked at the credit union part time. She retired in 1995.

Jack Sheets began working at the credit union in 1976 and has served as its president since 1987. When Sheets was a young member, Bainter helped him obtain a motorcycle loan.

Elkhart County Farm Bureau CU, changed its name to Interra CU in 2008. It now has $577 million in assets.

Bainter recalls that her two favorite departments to work in were member services and lending.

"That's where I got to know people and help them," she said. "Some are friends to this day."

Diversification aids CUNA Mutuals bottom line

 Permanent link
MADISON, Wis. (4/12/12)--CUNA Mutual Group posted stronger-than-expected results in 2011, positioning itself to withstand continuing economic pressures in 2012. The company said its bottom line was bolstered by the performance of its credit union businesses and diversification.

Cuna Mutual Group said its 2011 bottom line was bolstered by the performance of its credit union businesses and diversification.
The company's diversification strategy has begun to pay dividends. In 2010, when its credit union business didn't perform as well, ProAg, CUNA Mutual Group's crop insurance affiliate, helped improve the company's financial results. In 2011, when natural disasters stymied crop insurance results, CUNA Mutual Group's credit union businesses withstood the year's economic challenges.

"Our credit union and Wealth Accumulation businesses performed well in 2011, which offset the large amount we paid out in crop claims due to natural disasters," said Jeff Post, CUNA Mutual president/CEO. "We enter 2012 confidently, focusing on a three-pronged approach to growing our business--continuing expansion in the credit union market, crop insurance and through acquisitions via our recent mutual holding company restructuring."

Total operating revenue grew 5.4% to $2.5 billion from $2.4 billion in 2010, with more than half of that growth coming from crop insurance. Credit union consumer products--Auto & Home and Life & Health--and Wealth Accumulation offset lending-related revenue due to poor economic conditions.

Net income was slightly up--at $88 million from $87 million in 2010--due to strong operating performance and lower investment impairments.

Assets increased to $16.5 billion from $15.4 billion in 2010.

To see the CUNA Mutual annual report, use the link.

CU System brief (04/10/2012)

 Permanent link
  • SACRAMENTO, Calif. (4/11/12)--Ricky Flemings, 28, of Antelope, Calif., a member of Sacramento, Calif.-based Schools Financial CU,  pleaded guilty Friday to two counts of mail fraud stemming from a plan that involved claiming identity theft and allegedly getting credit reporting agencies to remove legitimate loans from his credit report to increase his credit score. The plan deceived Experian and other credit reporting agencies.  Flemings allegedly exploited provisions of the Fair Credit Reporting Act by taking out fraudulent loans from Oct. 1, 2005, through Nov. 12, 2009. He allegedly contacted Experian on multiple occasions, falsely reporting he was a victim of identity theft and demanding entries be removed from his credit report.  Experian blocked 162 inquiries and 40 trade lines from his report, which enabled Flemings to seek more credit. He received financing between July 9 and Sept. 5, 2009, from Schools Financial for a vehicle and a boat.  He allegedly then contacted Experian and asked for the entries to be removed from his credit report.  Sentencing is set for July 6 (Sacramento Bee April 7) …

Ruiz gets two years in prison for fraud at AEA FCU

 Permanent link
PHOENIX, Ariz. (4/11/12)--A Yuma, Ariz., businessman was sentenced to 24 months in prison and three years' supervision for one count each of conspiracy and transactional money laundering for his role in a $50 million fraudulent business loan scheme that helped put Yuma-based AEA FCU into conservatorship.

Frank Ruiz, 62, who had pleaded guilty in June to the charges allegedly received $4.75 million in fraudulent business loans from William Liddle, AEA's former vice president of lending. Ruiz initially faced 68 felony counts but the charges were reduced in a plea bargain and because he gave "substantial" assistance in the case against Liddle (KYMA.com and Loansafe.org April 10 and LSWT.com April 9).

In February Liddle was found guilty of 54 counts of conspiracy, fraud and transactional money laundering. His wife, Rhonda Liddle, was found guilty on 36 counts. Their sentencing is set for May 21.

AEA FCU, with $229 million in assets, was placed into conservatorship by the National Credit Union Administration (NCUA) in December 2010. In August, NCUA said the credit union's financial situation was improving.

CUNA Mutual Data breach ups exposure to phishing

 Permanent link
MADISON, Wis. (4/11/12)--CUNA Mutual Group is advising credit unions to warn their members about the potential for increased phishing attacks on the heels of a recent data breach at Atlanta-based Global Payments Inc.

In a risk alert to its credit union policyowners , CUNA Mutual also said the attacks could target members who were not impacted by the data breach.  The company also has posted a video update to Google+ and YouTube featuring  Risk Manager Ann Davidson discussing the alert. (To access the video, use the link.)

Global Payments "contained" the breach to less than 1.5 million debit and credit cards, Global said in a press release on April 1. Track 2 data may have been stolen, the company said. Track 1 and Track 2 data include names, card numbers and validation codes. Cardholder names, addresses and Social Security numbers were not obtained by cyber criminals who hacked part of its system. The hacking called Visa to drop the company from its "compliant service providers" list (News Now April 3).

Credit unions should alert members to be aware--especially in the next several days or weeks--of any suspicious e-mails, text messages or phone calls requesting any personal or financial information, especially card data, said CUNA Mutual's risk alert, the second issued since the Global Payments breach.

Card information that may be requested includes cardholder billing address, three digit CVV2/CVC2 code found on the back of the card, or enrollment criteria/passwords for Verified by Visa or MasterCard SecureCode.  "This card information was not part of the recent Global Payments breach. Criminals may ask members for this information to add to the other card data they may have obtained from the breach to perform card present (key entered) or card not-present (mail/telephone/internet) non-magnetic stripe transactions," the alert said.

Continue to advise members to never respond to e-mails, text messages or phone calls requesting this type of information.  If members receive suspicious requests advise them to contact the credit union, said CUNA Mutual.

CUNA Mutual offered these risk mitigation tips:

  • Educate the membership on phishing e-mails, text messages and phone call scams.
  • Record warnings on your telephone system and post notices on the credit union's website, in newsletters, and in branch lobbies stating the credit union will never solicit personal or financial information.
  • Advise members to not open unsolicited e-mails or text messages, or any links in unsolicited e-mails and text messages.
If a member has responded to a phishing scam with the requested information, take these steps:

  • Block and reissue the credit/debit card number;
  • Flag the member's account;
  • Advise the member to report the incident to the credit bureau, order a credit report, report the incident to the Federal Trade Commission, and file a complaint with the Internet Crime Complaint Center at www.ic3.gov;
  • Advise members to monitor their financial accounts closely and report any discrepancies.
CUNA Mutual will continue to monitor the Global Payments breach and notify its policyholders when new information becomes available.

Alloya Central Corporate signal intent to merge

 Permanent link
WARRENVILLE, Ill. And SOUTHFIELD, Mich. (4/11/12)--The boards of Alloya Corporate FCU and Central Corporate CU have signed a non-binding letter of intent to merge the two corporates.

In an announcement Tuesday, the Warrenville, Ill.-based Alloya and the Southfield, Mich.-based CenCorp said the action allows for ongoing discussions, due diligence and joint planning.  The new organization would serve nearly 20% of the nation's credit unions, primarily in a 10-state region spanning from the Midwest to the East Coast.

The combined corporate would continue under Alloya's federal charter and operate under the Alloya name.  CenCorp's current CEO, Bill Walby, would become CEO of Alloya with the headquarters located in Warrenville.  Board and committee representation would reflect the combined membership.

Given the geographic distribution of the combined memberships, the boards envision significant operations to remain in Alloya's current locations in Warrenville and Albany, N.Y., as well as CenCorp's Southfield, Mich. location.

"While very successful in its own right, the current and future operating environment  for corporates has prompted CenCorp to consider alternatives, including merger, that would enhance member value and better serve its members," said Walby.  "A merger with Alloya would create enhanced value for both memberships in the form of significantly increased scale, additional revenue growth, reduced operating costs, and additional financial strength," he added.

"With the enactment of the amended corporate regulations in 2011, corporates have needed to orient their business plans to a new paradigm," said Chuck Furbee, Alloya's CEO. "This merger would result in a corporate credit union with core markets in 10 states. With a strong reputation for service through a local presence in the regions served, the combined corporate will be staffed by an experienced team that is dedicated to serving the needs of the membership first and foremost," Furbee said.

Credit Union Association of New York President/CEO William J. Mellin said the association supports the planned merger, noting that the "unification of these two corporate credit unions is in the best interest of our credit unions here in New York and beyond. It will provide long-term strength and viability, not to mention long-term value and a continued service presence in New York."

The merger also "will help ensure the health and well-being of the credit union movement, as it provides a stronger credit union-owned solution to service credit unions--one that will bring more efficiencies and lower costs to natural person credit unions."   The partnership would  put into practice the cooperation advocated by not-for-profit financial cooperatives, Mellin added.

After due diligence is completed, the next step would be to execute a definitive merger agreement by both corporates.  The merger would be subject to approval of members of CenCorp and regulators.

Wachovia court filing claims MBS risks were clear

 Permanent link
KANSAS CITY, Kan. (4/11/12)--Wachovia Capital Markets filed a motion Friday in a federal court in Kansas to dismiss the National Credit Union Administration's (NCUA)  lawsuit to recoup losses from residential mortgage backed securities (RMBS) that corporate credit unions bought from Wachovia before the financial crisis.

In its motion to dismiss, filed in the U.S. District Court for the District of Kansas, Kansas City,  Wachovia argued that the MBS bought by U.S. Central FCU and Western Corporate FCU before they were placed into conservatorship by NCUA fell into a category known as "Alt-A" or mortgages that are neither "prime" nor "subprime" and that  its prospectuses for the investments outlined clearly the risks involved.

In its motion, Wachovia says that "approximately 73% of the loans were reduced documentation or no documentation loans, i.e., loans for which the borrower was not required to submit proof of his or her income, assets, or both."

Wachovia issued, underwrote and sold the funds, which were originated by four lenders: National City Mortgage, Accredited Home Lenders Inc., Wachovia Mortgage Corp., and American Mortgage Network.

NCUA's original complaint against Wachovia alleged that originators of the RMBS had systematically abandoned the stated underwriting guidelines and resulted in riskier RMBS that the corporates would not have bought, had they known.  Wachovia representatives sold about $100 million in RMBS to the corporates in 2006. U.S. Central purchased about $80 million in RMBS underwritten by Wachovia, according to the complaint NCUA filed Nov. 28 (News Now April 3).

Wachovia's motion included "the extensive risk disclosures" in the prospectuses for two offerings, the Wachovia Mortgage Loan Trust and the NovaStar Mortgage Funding Trust. They included:

  • " If the residential real estate market should experience an overall decline …delinquencies, foreclosures and losses could be higher than those now generally experienced;
  • "Most of the loans in the pools would not meet the requirements of Fannie Mae and Freddie Mac;
  • "As a result of the underwriting guidelines used …these mortgage loans are likely to experience rates of delinquency, foreclosure and bankruptcy that are higher, and that may be substantially higher, than those experienced by mortgage loans underwritten to Fannie Mae and Freddie Mac conforming guidelines;" and
  • "There is no assurance that the ratings [by rating agencies] …will not be qualified, lowered, or withdrawn."
Wachovia also said the complaint lacked any allegations specific to the originators of the mortgage loans underlying the offerings and said that "generic allegations" are not enough for a claim.

The crux of Wachovia's motion to dismiss focused on NCUA's meeting requirements for statute of repose and statute of limitation deadlines for filing the lawsuit and whether an extender statute applies to the case. Wachovia noted that the three-year statute of repose extinguishes NCUA's federal claims and that the extender statute, which would grant an extension to the deadline for filing in some cases, does not apply.

Those arguments followed a tentative ruling set in a U.S. District Court in California on a similar RMBS case, NCUA vs. RBS Securities, and said a case cited by NCUA, American Pipe Tolling, does not apply.

News Now contacted NCUA for a comment. NCUA's policy is to not comment on pending litigation.

CUs announce trio of mergers in Calif. Conn.

 Permanent link
SAN JOSE, Calif. and SHELTON, Conn. (4/11/12)--Three credit union mergers have been announced, two in California and one in Connecticut.

San Jose, Calif.-based Pacific Postal CU, with $188 million in assets, announced Monday it will absorb East Bay Postal CU, an $8.2 million asset credit union based in Oakland, Calif. (Silicon Valley/San Jose Business Journal Online April 9).

Pacific Postal has four branches and 14,600 members. East Bay has one branch and 1,700 members. The merger could be completed by July 1, East Bay CEO Cynthia La Croix told the publication. 

El Camino Hospital FCU, an $8.3 million asset credit union based in Mountain View, Calif., has been approved to merge into Provident, CU, a $1.52 billion asset credit union, based in Redwood City, Calif., according to the California Department of Financial Institutions.   

Mutual Security CU, a $235 million asset credit union in Shelton, Conn., plans to absorb $3.1 million asset, Bridgeport, Conn.-based Connecticut Energy Employees CU--formerly SoConn Gas Employees CU (CEECU) Inc.

CEECU employees are slated to vote on the merger April 23. CEECU has 600 members. Mutual Security CU has 34,405 members.

California DFI State CU assets up 1.7

 Permanent link
SACRAMENTO, Calif. (4/11/12)--California state-chartered credit unions assets went up 1.7% to $73.1 billion in the fourth quarter 2011 from $71.9 billion a year earlier, according to the California Department of Financial Institutions (DFI).

Shares at $62.9 billion rose 2.5% from $61.4 billion during the same period. Loans declined 4.8%, going to $40.5 billion from $42.5 billion.

State-chartered credit unions net worth was up 7.3%, hitting $7.3 billion from $6.8 billion a year earlier. That caused the net worth to asset ratio to increase to 9.95% from 9.43% a year ago, said DFI.

The fourth-quarter loan loss allowance totaled $1.1 billion, a 13.5% decline from $1.3 billion one year prior, while delinquent loans at $920.7 million dropped 15.3% from $1.1 billion at year-end 2010. Delinquent loans as a percentage of total loans were 2.27%, down from 2.55% a year earlier. Other real estate owned increased 14.7% to $152.3 million from $132.8 million the previous year.

Net margin to average assets was at 4.18% down from 4.38%, while the provision for loan losses decreased 45.2% to $419.6 million from $765 million.

Fourth-quarter net income rose 52.2% to $510.6 million from $335.4 million at year-end 2010.

The number of credit unions declined 2.5% to 158 from 162.

Georgians will hit the road but monitor vacation budgets

 Permanent link
DULUTH, Ga. (4/11/12)--Georgians will hit the road this summer, after years of economizing and staying close to home with "staycations," according to a survey by the Georgia Credit Union Affiliates (GCUA). Although higher gas prices aren't likely to be an impediment, the added cost may cause some people to alter the lengths of their vacations or find cheaper alternatives. That mirrors national trends, said GCUA.

Sixty-three percent of respondents to the GCUA Consumer Survey said they plan to spend more or the same on travel in 2012 than they did last year. That's up from 49% who said the same thing in 2010 (GCUA's Consider This April 3).

Traveling on a budget remains a priority. The GCUA survey found that 31.7% of respondents worked harder to find deals and save on travel in 2011 than they did in previous years.

With many travel bargains and regional destinations to choose from, people can still find the money-- and the time--to take trips this year, GCUA said.

On a national level, travel experts expect people to change the type or length of their travel rather than opt to cut out travel entirely, according to a CBS.com report in March. Many travelers have found that remaining flexible with timing and destination can help. Travelers can search for discounts on several destinations and choose the one with the best deals, GCUA said.

Regional destinations are expected to be popular this year, reducing the fuel costs associated with vacations. Thetravelguide.com suggests vacationers book their vacations in bundles instead of booking airfare, hotel and attractions separately. The site also recommends asking lots of questions when making plans. Sometimes booking for a particular day of the week can result in savings.

During the past few years, family camping trips have seen a resurgence, especially in national parks and forests, with that trend seeming to continue into 2012 (prweb.com April 3). 

Many national parks are seeing a consistent rise in the number of visitors, which makes it harder to find campsites in a park's campgrounds and to enjoy solitude and the appeal of the outdoors. Once in the park, visitors likely will find attractions crowded, roads congested and campgrounds full, prweb.com said.   

Camping in a national forest is a good alternative because there are 175 national forests located in 43 states--many within a day's drive from most big metropolitan areas, and many surrounding a national park, prweb.com added.

Many of her members are still approaching vacations cautiously, Tina Burkhalter, president of Nashville (Ga.) CU, told GCUA. "I believe rising gas prices will certainly affect our members' decisions on where to go and how far to travel," she said.

To save money, she suggests that people consider taking shorter vacations. A shorter trip costs less, but still provides the chance to relax and get away. "Most of our members rely on loan proceeds to fund their vacations," Burkhalter said.

A better option is for people to prepare in advance for their vacations by saving a little at a time throughout the year in a vacation club savings account, and funding it through payroll deduction, she added. With a small amount saved each week, people can give themselves the freedom to take the trip they want, Burkhalter concluded.

Guatemalan CU professionals intern in California Iowa

 Permanent link
MADISON, Wis. (4/11/12)--Ten Guatemalan credit union professionals arrived in the U.S. last week to begin the first phase of a month-long internship program with credit unions in California and Iowa. The interns, all under the age of 40, are the first cohort of World Council of Credit Unions' (WOCCU) new International Credit Union Leadership Program.

Victor Manuel Garcia Salazar (right), a Guatemalan intern with Des Moines (Iowa) Metro CU, shakes hands with Iowa Democratic state Rep. Bob Kressig during a visit to Iowa's capitol while Linda Gibbs, business development specialist for Greater Iowa CU in Ames, looks on.
The program, funded by a grant from the U.S. Department of State, Bureau of Educational and Cultural Affairs, Office of Citizen Exchanges, is part of the State Department's larger Professional Fellows Program.

With assistance from the California and Nevada Credit Unions Leagues, six interns were placed in credit unions in the Los Angeles and San Francisco metro areas. The Iowa Credit Union League has helped place the remaining four interns at credit unions in Des Moines and Ames.

During the program's second cohort, 10 young professionals from the U.S. will intern in Guatemalan credit unions to further broaden international relations and establish higher levels of credit union professionalism worldwide, according to Brian Branch, WOCCU president/CEO.

"The goal of the Professional Fellows Program is to increase networking among young professionals and foster higher performance levels," Branch said. "For participants in the International Credit Union Leadership Program, this will translate into a stronger global credit union network and better member service delivered by credit unions in participating countries."

Interns traveling to California will focus on gaining skills in credit union management including greater marketing awareness, training in financial disciplines and techniques for new product and service delivery methodologies, while improving their English.

Guatemalan intern Roberto Monge (right), human resources director at the Guatemalan credit union trade association (right), learns new strategies from Fernando Arias of Patelco CU in Pleasanton, Calif. (Photos provided by World Council of Credit Unions)
Although the program is not part of the WOCCU International Partnerships Program, the California and Nevada leagues view the internships as a natural extension of their existing relationship with credit union trade association Cooperativas Federeadas de Ahorro y Crédito de Guatemala, their Guatemala partner organization, according to Diana Dykstra, the leagues' president.

"This is another great example of our partnership with Guatemala--to share expertise and experiences, and improve the credit union movements in both countries," Dykstra said.

Interns in Iowa will gain expertise in many of the same areas, and will seek potential solutions to operational challenges they're facing at their credit unions back home. Also, the exchange program allows host credit unions to gain a greater perspective on Hispanic culture and business practices that may have practical applications in helping the credit unions better serve their own Hispanic populations, according to Patrick S. Jury, president/CEO of the Iowa league.

"Our credit unions will provide a unique perspective and training environment for our guests looking to take home new experiences," Jury said.

At the conclusion of their fellowships, all participants will travel to Washington, D.C., where they will take part in the Professional Fellows Congress, May 3-5. The congress marks the culmination of the U.S. exchange experience, providing a forum for participants to discuss best practices, meet other young leaders within their profession, and develop concrete projects and networks they can implement upon their return home.

In October, WOCCU's International Credit Union Leadership Program will pair interns from the Dominican Republic with credit unions in Wisconsin and North Carolina. The Wisconsin Credit Union League also is paired with the Asociacion de Instituciones Rurales de Ahorro y Creditor Inc., the Dominican Republic's credit union trade association, as part of the program. In January 2013, the next group of U.S. program participants will intern with credit unions in the Dominican Republic.

WOCCU's International Credit Union Leadership Program, which promotes internships for young credit union people from various countries, is designed to facilitate idea exchanges, promote foreign language skill development, enhance cultural diversity and improve problem-solving skills as they relate to credit union development and management on a global basis.

The program's second cohort, which will involve choosing 10 Spanish-speaking U.S. applicants to intern in Guatemala credit unions, begins in June. The deadline for applications is April 20.

For more information, use the links.

iKiplingeri slideshow features 7 CUs anyone can join

 Permanent link
MADISON, Wis. (4/11/12)--An online slideshow on kiplinger.com features "7 Credit Unions Anyone Can Join," and directs consumers to a link for asmarterchoice.org, the online credit union locator tool.

The tool, asmarterchoice.org, also compares average rates and fees at credit unions vs. banks, highlights the latest "good news" on credit unions appearing in the media, and presents real-life comments submitted by people who belong to credit unions. It is presented by the Credit Union National Association and the leagues.

"[Credit unions] tend to charge lower loan rates, pay higher savings yields and 'treat borrowers who are struggling more sympathetically,'" said Stephen Brobeck, executive director of the Consumer Federation of America, in the kiplinger.com article.

The seven credit unions included in the slideshow are:

  • Alliant CU, Chicago;
  • Connexus CU, Wausau, Wis.;
  • Consumers CU, Waukegan, Ill.;
  • Lake Michigan CU, Grand Rapids, Mich.;
  • NASA FCU, Upper Marlboro, Md.;
  • Pentagon FCU, Alexandria, Va.; and
  • Navy FCU, Vienna, Va.
 To view the slideshow, use the link.

Minnesota CUs launch Bankziety campaign

 Permanent link
ST. PAUL, Minn. (4/11/12)--The Minnesota Credit Union Network (MnCUN) has launched its "Bankziety" campaign, a response to consumer frustration with banks and a showcase for credit unions as an alternative.

The campaign includes SeeYouLaterBank.com, a website offering events, contests and promotions to provide consumers with tools and resources that highlight the benefits of credit union membership. The site also features a credit union finder, information comparing banks and credit unions, and money management tips.

"Our credit unions have been telling us that they're seeing more and more new customers coming through their doors because people are ready for something different," said Mark Cummins, MnCUN president/CEO. "Based on what we were hearing, the time is definitely right to capitalize on this 'bankziety,' a term we use to describe the anxiety and frustration consumers are feeling right now about banks."

The "Bankziety" campaign also includes a Facebook contest asking Minnesotans to share their stories of banking anxiety, money stress or how credit unions have been the bankziety cure. Up to 12 entrants will win cash prizes and gift cards, with the top four entrants awarded $2,000 and a chance to tell their stories as part of a video series.

Stories can be submitted through May 7 on the MnCUN Facebook page.

NCUFICUF grant finances Iowa fin ed projects

 Permanent link
DES MOINES, Iowa (4/11/12)--Through grants from National Credit Union Foundation and the Iowa Credit Union Foundation (ICUF), 43 Iowa credit unions have received training and technical assistance to provide financial education to members living below the poverty level.

Click to view larger image Pictured are Iowa Credit Union Foundation (ICUF) board members and credit union CEOs who received a 2011 financial education grant from ICUF through a Financial Education Grant from the National Credit Union Foundation. From left, Paul Lensmeyer, Ascentra CU, Bettendorf; Pat Drennen, 1st Gateway CU, Camanche; Debbie Whittie, Village CU, Des Moines; Becky DeVries, Midland CU, Urbandale; Dale Owen, ICUF president of the ICUF; Helen Pearce, ICUF vice president; and Marybeth Foster, ICUF executive director. (Photo provided by the National Credit Union Foundation)
"Financial education is key to building the financial assets of low-income populations," said Marybeth Foster, ICUF executive director. "Our goal is to strengthen the capacity and build leadership in credit unions to deploy financial education."

The financial education training was delivered by Adam Carroll, president/CEO of National Financial Educators.

Highlights of financial education project included:

  • Eleven webinars were developed for credit unions on financial education topics;
  • Fifty credit unions were provided with a financial education toolkit, which included a binder of flyers, handouts, worksheets, and materials on all webinars produced by ICUF for use with credit union members and the general public; and
  • Sixteen credit unions received financial education grants from ICUF to fund financial education programs.
The project is closely tied to the ICUF's Credit Union Family Partnership Individual Development Account program (CUFPP), which empowers building assets for individual development account (IDA) savers wanting to buy a first home, pursue education or a small business.

The project's focus is on financial education to families at or below 300% of the federal poverty level, who typically qualify for the federally funded Children's Health Insurance program. ICUF chose this target market because these families can be served by CUFPP under legislation passed in Iowa. Families have a household net worth of less than $10,000 at the time of application to the IDA program.

Financial education is a core component of the IDA program because savers must complete financial education to receive matching funds. Before the program began, participating credit unions did not have the resources to offer financial education programs.

Illinois REAL Solutions network has first meeting of 2012

 Permanent link
NAPERVILLE, Ill. (4/10/12)--Illinois REAL Solutions program partner credit unions attended their first in-person meeting of  2012 last week. They discussed attracting new members and eco-friendly loans, and compared popular prepaid cards.

Jonthan Fuhrman, marketing consultant with CU Solutions Group, noted that Generation Y (ages 17-32) is a group most credit unions hope to attract as new members. The evolution of technology and this group's lack of experience in managing money makes reaching Gen Y an interesting challenge, he said. 

He shared information on understanding Gen Yers, then reviewed marketing methods--traditional, online, social responsibility, mobile and referral--and explained how to maximize their effectiveness in reaching out to Gen Yers. Among the suggestions for marketing to this group:

  • Review images portrayed in printed marketing pieces, on websites and in lobby displays to ensure young, single adults are among those represented in the images;
  • Create and maintain a Facebook page, add QR codes (quick response barcodes) to printed materials, and develop mobile websites and ads; and
  • Avoid one-size-fits-all approaches; each credit union has its own goals and demographics to consider when determining the best marketing techniques to employ.
Abby Coroso of the Delta Institute discussed Eco-Friendly Loans and Energy Impact Illinois (EI2), a collaborative effort to help residents, businesses and non-profits reduce energy use. El2 is looking for credit unions to participate as lenders in its Residential Retrofit Loan Program. Homeowners use the loans to make home improvements that improve energy efficiency. Examples include upgrading boilers or furnaces, water heaters, programmable thermostats, central air conditioning and other qualified appliances or equipment. MembersAlliance CU, Rockford, and North Side Community FCU, Chicago, are involved in the program, which launched in November.

Jim Byrnes, executive director, national accounts for the ICUL Service Corp. (LSC) compared the Suzy Orman-endorsed prepaid card for consumers with others in the market, including LSC's CU Money product.

The second of the two in-person meetings for 2012 will be Oct. 16 in Naperville. The meetings are part of the REAL Solutions for Low Wealth Households program. The Illinois Credit Union League and ICU Foundation teamed with the National Credit Union Foundation in 2009 to offer the program. Currently 87 Illinois credit unions are participating. The program is operated by 35 leagues representing 37 states and includes more than 1,000 credit unions nationwide.

Arizona State CU helps underwater homeowners refinance

 Permanent link
PHOENIX (4/10/12)--Arizona State CU, based in Phoenix, has accepted 167 applications for the Home Affordable Refinance Program (HARP) to help underwater homeowners obtain more affordable mortgages in today's low-interest rate environment.

Homeowners who are current on their Fannie Mae mortgage and have not been able to obtain traditional refinances because of the decline in their home's value, may be eligible for HARP.

"If members can benefit from a lower mortgage payment, then we, as a local financial cooperative, need to meet this need," said David Doss, president/CEO of the $1.3 billion asset credit union.  "The opportunity to offer HARP is significant to the credit union as it can help Arizona residents rebound from economically challenging times," he said.

HARP has been extended by the Federal Housing Finance Agency to help eligible homeowners refinance to take advantage of historically low interest rates, even if the outstanding balance of the mortgage is greater than the value of the home.

More media report CUs stand on MBLs

 Permanent link
MADISON, Wis. (4/10/12)--More small businesses are letting media know how credit unions have helped them through a tight credit market.

Their support comes at a time when credit unions, leagues and the Credit Union National Association (CUNA) are pushing for Congress to raise credit unions' member business lending (MBL) cap to 27.5% of assets from 12.25% so credit unions can help more small businesses and the economy.

In a letter to the editor of The Columbus Dispatch (April 7), Ohio Credit Union League President Paul Mercer  wrote that the Credit Union Small Business and Jobs Bill (Senate Bill 2231) would help generate up to $275 million in new credit available to Ohio small businesses and more than 3,000 new jobs.

"Since the beginning of the economic decline, when many banks began limiting access to credit, Ohio credit unions saw demand soar, increasing outstanding business loans by 98.5% from December 2007 to December 2011," Mercer wrote.  During the past 12 months, loans to businesses by Ohio credit unions grew 24% to $430 million. Roughly 57% of small business owners who sought financing from banks were turned down, he wrote, citing statistics from Pepperdine University.

Also during the weekend, small businesses in Iowa and North Carolina were speaking up on behalf of raising the MBL cap.

In the Winston-Salem (N.C.) Journal (April 8),  Jim Dobbins, owner of a 23-year-old construction company, Sharp Interiors Inc., told of his quest for a six-figure loan.  A slowdown in demand and customer payments had left the company struggling in late 2010 and its existence--as well as 32 jobs--were in jeopardy.  The company was sick but knew that it could weather the storm with a loan, he told the Journal.

Dobbins' request was turned down by seven large and community banks. Some banks said their hands were tied because of increased regulations after they had accepted Troubled Asset Relief Program money from the U.S. Treasury. Instead of lending to small businesses, they were bolstering their own capital levels, said the article.

Other banks were unwilling to risk a loan for a small business without stellar credit, said Dobbins. He eventually got a loan from Allegacy FCU in Winston-Salem after three months of due diligence and uncertainty, said the article. "Allegacy stood up when no other financial institution would," Dobbins told the paper. "I had gotten to the point of literally having no other option available to me." 

The loan enabled Sharp Interiors to not only survive but also more than double its work force in the past 18 months to 70 employees. It did $10 million in business last year, and expects a10% increase this year.

Others who spoke up on behalf of credit unions:

  • Robert and Faith Newton, Bloomfield, Iowa, who wrote in a letter to The Ottumwa Courier that three years ago their company, Troy Elevator Inc.," needed long-term financing due to several factors, some of which were beyond our control. We applied for financing at a number of banks but were turned away for various reasons." Community 1st CU "came to our rescue and provided us a guaranteed loan through the RSDA Rural Development Loan Program.  Thanks to our credit union, we were able to keep our business in operation and keep our 40 employees working. Unfortunately, Community 1st--and many other Iowa credit unions--may not be able to make a loan to the next business owner in need due to an arbitrary cap on the amount of business loans they can make."
  • John Stewart of Centerville, Iowa, who got a small business loan to buy his place of employment, Centerville Body Shop, when the owner retired. "I looked at different financing options and found that Community 1st really wanted to help me." The credit union "looked at every option that was available to find the best avenue for me so I could buy my small business,"  he wrote in a letter to the editor of the Daily Iowegian.
  • Shirley Hendrickson, Iowa City, who told the Iowa City Press-Citizen that a credit union helped her purchase a bed and breakfast seven years ago. Today many are constrained by the cap, she noted.
The Iowa Credit Union League also noted it is airing tv ads in support of raising the MBL lending cap.  Use the link to the ad on youtube.

Catalyst Corporate membership tops 1190

 Permanent link
PLANO, Texas (4/10/12)--Catalyst Corporate has reached more than 1,190 capitalizing member credit unions nationwide after launching with 890 members last September.

Although membership rose steadily throughout the final months of 2011, the greatest influence on growth is transition of Western Bridge Corporate members, the corporate said.

Two hundred eighty-five Western Bridge members pledged more than $46.5 million in capital to Catalyst Corporate, bringing total Perpetual Contributed Capital to more than $144 million.

"We have exceeded our business plan target well in advance of the acquisition date and will continue to accept new member capital as long as credit unions want to join," said Kathy Garner, Catalyst Corporate president/CEO. Catalyst's upcoming acquisition of certain Western Bridge assets and is slated to occur on July 1.

Catalyst continues to lay the groundwork for serving its coast-to-coast membership. In addition to its Plano, Texas, headquarters, Catalyst maintains branch offices in Georgia and Hawaii, and is working to secure space in Southern California.

The corporate also has staff in California, Oregon, Washington, Oklahoma, Florida, Utah and Idaho. They also provide coverage for the neighboring states of Nevada, New Mexico, Arkansas and Louisiana.

"Even though the majority of our business can be performed remotely, we believe that a local presence is important, especially in states where we have large concentrations of members," Garner said.

In Georgia and Hawaii, Catalyst's employees share office space with local leagues. Last week, the space-sharing arrangement between Catalyst and the Texas Credit Union League was made public. Catalyst said it will see substantial savings in its operating costs while furthering the cooperative relationship with the league.

"We all have the same stakeholders, and physical proximity can serve as a valuable reminder that collaboration can help us with future endeavors to serve those stakeholders," Garner said.

Also, the board of directors is adding two new seats to accommodate representation from Western Bridge Corporate's membership. These directors will be selected for recommendation to the board by a Governance Advisory Council--also made up of Western Bridge members.

Catalyst's Western Regional Council was established this week, shortly after the kick-off meetings of the Eastern and Central Regional Council meetings in late March.

Filene report urges CU digital branding

 Permanent link
MADISON, Wis. (4/10/12)--Digital branding and social strategies are becoming the necessary norm for all businesses, including credit unions. But there is a danger that managers, while acknowledging this new norm, can get in trouble by not approaching it strategically, according to a recent report from the Filene Research Institute.

Filene convened a panel of expert researchers and practitioners in November to discuss and show how credit unions should think about their own branding and digital presence as marketing moves to an increasingly electronic format. Filene wanted to know what tools are out there--and what's coming down the pike--along with what digital messages and channels resonate with today's consumers.

It is not enough to turn traditional collateral and messaging into digital collateral and messaging, the report noted. Instead, credit unions need to capitalize on the deeper trend of social connections to make sure their marketing reaches the right audience in the first place and has its intended effect when it arrives. Mobile usage, more emphasis on design, and social marketing are trends that every credit union needs to consider, especially as it looks for new members, said Filene.

The colloquium included a cross-section of social media practitioners and researchers and strategists from Google and Facebook. Each brought a different message, but the unspoken message was that digital marketing is becoming ever more important. Adopting it won't be enough; embracing it is the only acceptable route, said the report.

Other credit union implications the colloquium noted:

  • Consumers trust other consumers' opinions more than any form of advertising. Now that consumers can meet each other online, credit unions should facilitate the interaction around their brands, according to Hope Schau, associate professor of marketing at the University of Arizona.
  • Bank Transfer Day proved two things when its founder, Kristin Christian, began the movement. One is that social media have undisputed power in today's communications world. The other is that credit union ethos resonates among a large number of consumers.
  • Measuring impact is much more important and harder to do than measuring output.  Maximizing impact among Gen Yers requires promoting emotionally rewarding concepts; rational advertising is not enough, said Maya Bourdeau, partner, Attune. Work within what the credit union target already believes--social responsibility and collaboration--instead of trying to bring Gen Yers to the credit union message.
  • Good social media correlate with important performance measures but not in every category. Credit unions that perceived their social media efforts as successful were more likely to see loan growth, more website visits and higher deposit volume, according to Beth Austin, principal, Crescendo Consulting.
  • Search functions and social media are essential platforms for every financial institution because online is the preferred banking channel and because of the huge increase in mobile searches during the past three years, said Payton Dobbs, head of industry, banking & lending at Google.
  • The inherent advantage social media bring to marketing is the ability to find members/customers that look a lot like and have a reason to listen to existing members/customers, said Christine Trodella, national sales manager, Facebook. The colloquium presenters agreed that credit unions have an advantage on the social media playing field because--unlike big banks--they need fewer efforts to convince consumers that they are authentic and that they have members' best interests at heart.

CU System briefs (04/09/2012)

 Permanent link
  • 4/10/12)--Vermont CU regulatory agency has new nameMONTPELIER, Vt. (4/10/12)--The state agency that regulates state-chartered credit unions and financial institutions in Vermont has changed its name to the Vermont Department of Financial Regulation (burlingtonfreepress.com April 4).  The former name, the Vermont Department of Banking, Insurance, Securities & Health Care Administration , or BISHCA, was dropped in legislation signed last week by Gov. Peter Shumlin. The new name reflects the streamlining of the department after a law enacted last year moved the oversight of health insurance and hospital budgets to the Green Mountain Care Board …
  • BROCKTON, Mass. (4/10/12)--Brockton, Mass.-based Crescent CU has been awarded a $67,676 employee training grant from the Massachusetts Workforce Training Fund, according to the Massachusetts Credit Union League (Values & Visions March 27).  The grant was based on Crescent's application demonstrating its commitment to investing in training to further develop employees and improve service to members.  The comprehensive training proposed includes training in areas such as commercial sales leadership and quality and efficiency processes. Employees from every level  will participate in the program, which will take place over two years.  Pam Walsh, Crescent's assistant vice president, employee development, will coordinate the program, which will be conducted by Tandem Training of Keene, N.H. ...
  • MANHATTAN BEACH, Calif. (4/10/12)--Keith A. Sultemeier  has been named president/CEO of Manhattan Beach, Calif.-based Kinecta FCU,  effective April 23, the credit union announced Monday.  He will oversee all aspects of the credit union and will work closely with Roger Ballard, who previously served as joint CEO of both Kinecta and NuVision FCU, to ensure a smooth transition.  After the transition, Ballard will return to NuVision as CEO.  Sultemeier brings 12 years of credit union experience plus 10 years of strategic planning and financial management experience to Kinecta. Most recently he served as executive vice president at Security Service FCU in San Antonio, Texas, where he led strategic planning and budgeting for the organization and directed operations in both back office and member-facing divisions …
  • SHELTON, Wash. (4/10/12)--Jim Morrell has been selected as president/CEO of Shelton, Wash.-based Peninsula FCU, succeeding Steve Gorseth, who will retire in June, said the Northwest Credit Union Association (Anthem April 3). Morrell has spent the past 14 years at iQ CU in Vancouver, Wash., where he was most recently  served as senior vice president of support services. Morrell has been active in the credit union movement and has served as chair of the CUNA Technology Council in 2002; on the former Washington Credit Union League's (WCUL) Evolution Task Force, the NWCUA Future Leaders Task Force, Washington Model Credit Union Act subcommittee, and the Filene Research Institute's i3 group. He was named WCUL's 2010 Distinguished Credit Union Professional of the Year. Morrell has more than 20 years' experience in the financial services industry, including 17 in the credit union movement …
  • HAMILTON SQUARE, N.J. (4/10/12)--Harold Ley, president/CEO of Mercer County NJ  Teachers' FCU, died Saturday after battling cancer. He was 50 years old.  "Harold was an inspiration for his staff at Mercer County Teachers and a dedicated credit union leader. He will be missed," said Paul Gentile, president/CEO of the New Jersey Credit Union League.  Ley joined the credit union in April 2006 as assistant vice president of operations and was promoted to president/CEO in November 2008. He is survived by his wife, Maureen, and two children, Kaitlyn, 12,  and Aiden, 5. No services will be held, according to the credit union (The Daily Exchange April 9) …

NWCUA CUs should track MBL stories online

 Permanent link
BEAVERTON, Ore. (4/10/12)--Credit unions are working to educate the media and public about their efforts to get Congress to raise the member business lending (MBL) cap. And some credit unions are succeeding. But what happens after their articles are published or aired?

Once the first media hits are registered, credit unions should track those stories online and consistently post on the story's comment section, said David Bennett, Northwest Credit Union Association (NWCUA) director of public relations.

Bennett called this "camping a site" to make sure accurate information and positive comments appear near the top of the comments section.

"Sharing those stories on Facebook, Twitter, on credit union websites--even in branch lobbies--is another important aspect of moving this to social media and spreading the word," Bennett said.

Every social media message on this topic should have an action item, said NWCUA Anthem April 5). In the case of MBL, the action item is asking consumers to call or write their legislators.

Credit unions in the Northwest are among those selling positions on MBL in the local media. Mid-Oregon CU, Bend, Ore., was recently featured in the Central Oregonian touting the benefits of increasing the MBL cap for credit unions.

On March 29, Mid-Oregon placed a story in the Bend Bulletin that said increasing the MBL cap to 27.5% of assets from 12.25% would add 2,700 more jobs in Oregon and 140,000 nationwide, according to the NWCUA.

The Credit Union National Association (CUNA) and credit unions are in the midst of a national effort to get the MBL legislation passed through in Congress. By increasing the MBL cap, credit unions can help the country inject $13 billion available for small business lending.

North Coast CU in Bellingham, Wash., is engaging members directly on its website with a pop-up box that asks members for their help. The box explains why their help is needed, and provides a link to contact their legislators. Developed as a reaction to help alert credit unions to phone scams, the pop-up box has become part of the credit union's repertoire of tactics when engaging members.

Spokane-area credit unions held a conference call recently to unify their message. Working in solidarity, local leaders outlined a strategy that includes petitions and a letter drive.

"It would be counter-productive for every credit union to work individually on this effort, because it will surprise journalists who think of us as competitors," Dan Hanson, Spokane Teachers CU senior writer and public relations expert, told NWCUA. "And because a good idea coming from any credit union should be shared with all the others."

Many Northwest credit unions are also engaging editorial page editors and editorial boards to offer information about elected officials and their constituents.

"Pitching to the editorial page comes with some risks, depending on what is being pitched and the general leanings of the outlet, but the rewards can be tremendous," said Bennett. "Because most (traditional newspapers) are pro-business, editorial board meetings can be effective as long as arguments are well prepared and practiced. Those being interviewed should also be ready to be filmed, as many newspapers use these to fill their social media requirements."

Opinion editorials and letters to the editor come with far less risk, but carry less weight to readers, generally, because they are not third-party endorsements and present one side of an issue, Bennett said.

Its not too late to sign up for Youth Week

 Permanent link
MADISON, Wis. (4/10/12)--There's still time to register for the National Credit Union Youth Week and the National Youth Saving Challenge--two events sponsored by the Credit Union National Association (CUNA) in celebration of National Financial Literacy Month.

Credit Union Youth Week is April 22-28. This year's theme is "Be a Credit Union Super Saver."

Click for slide show For a look at the past 11 years of National Credit Union Youth Week Posters, click on the slide show.
National Youth Saving Challenge is held during the entire month of April. Last year nearly 146,000 young members deposited $28.5 million into their saving accounts during National Youth Saving Week---with 9,058 new accounts.

Events such as youth week and the savings challenge offer credit unions an opportunity to differentiate themselves within their communities, said JoAnne Sepich, CUNA's Youth Week coordinator. For that reason credit unions should spread the news that they are participating, she added.

"Let people within your community know about it," Sepich said. "Tell your sponsor groups. Nothing endears you to people more than doing something for their children."

Even credit unions without a budget can participate in Credit Union Youth Week. Sepich offers these tips:

  • Register for the National Youth Saving Challenge. The free program helps affiliated credit unions build strong relationships with youth and their families. CUNA will tally and report the deposits, plus offer $100 cash prizes to youth at 10 participating credit unions. Register by answering a few simple questions. Use the link for more information
  • Display the free challenge poster. Affiliated credit unions received a free Youth Week poster in January.
  • Play along. Invite the staff to ham it up during Youth Week. Credit unions can feature a theme where employees dress accordingly.
  • Share goals. Set a good example. Invite the staff to put up pictures of their own savings goals. Post them by their stations or make a collage.
  • Hold a book drive. Invite staff and members to donate new and gently used books during the week and then deliver them to a school or a local library.
  • Color. Put out crayons and coloring pages to entertain the youngest members.
  • Hold a petting zoo. Contact your zoo or Humane Society about bringing in some kid-friendly pets Saturday morning.
  • Hold a cook off. Feed young visitors with brownies, cookies, and candy made by staff.
  • Go to school. Send volunteers into local schools to introduce money management principles.
Here's how three credit unions around the country will celebrate Credit Union Youth Week:

  • UT FCU, Knoxville, Tenn., will hold events at two locations, and at each location it has asked community organizations to get involved by adding an item to the backpacks of goodies each child will receive or by setting up a booth at a branch the day of the event to join. One location will feature a rock-climbing wall provided by the National Guard. Invitations have been sent to more than 300 area youth and their families. Registrants will be entered into a drawing for a Wii entertainment console and a sports package to be given away by UT FCU.
  • Eaton Family CU, Euclid, Ohio, is tying the release of "The Avengers" movie with its Super Saver promotion. Parts of "The Avengers" were filmed in Cleveland, so many area residents are aware of the movie's release in May. The credit union will deposit $20 to any new youth account opened during Credit Union Youth Week. New youth members also will receive a T-shirt with a yellow-and-red Eaton Family emblem on the front and "I'm a Super Saver at Eaton Family Credit Union" on the back. Any deposit of $100 or more will enter the youth into a drawing in conjunction with a locally-owned movie theater for four tickets, four snacks, millionaire for a day service ($20 interest from $1 million on deposit for one day), and a Super Saver T-shirt.
  • Ventura (Calif.) County CU is hosting a video contest in which participants are asked to tell other young members how to be credit union super savers. The creator of the winning entry will win $100 plus $2,500 for his/her school's film/video production program. The credit union will also award $25 gift cards to five runners-up.
Amid all the games, events and activities, good financial management and savings, credit unions have one simple message that holds true for both children and adults: Take care of your needs before your wants.

"That is very easy for children to understand, and it can be a life-changing message for entire families," Sepich said.

iPads change America Firsts financial reports

 Permanent link
RIVERDALE, Utah (4/10/12)--America First CU has used Apple iPads to cut costs and offer a more visual depiction of the credit union's financial results.

The $5 billion credit union began to replace laptops in November 2010 as a cost-cutting measure, according to a recent article in American Banker. At $499 to $699 each, iPads cost about 50% to 75% less than the notebooks America First had previously used, according to the article.

At the same time, America First CU was trying to find a more timely and user-friendly way to reproduce the credit union's financial information. National Credit Union Administration was pressuring credit unions to translate numbers faster to prove they had adequate risk controls.

"It was taking executives too long to make sense of the credit union's financial information," said the article, headlined "The Whole Bank on an iPad."

Thayne Shaffer, America First's controller and vice president, was put in charge of organizing a team and maximizing the iPad's potential.

Shaffer and his team sought a business intelligence app that transforms financial data into pictures with descriptive text and also display trends in a manner that could be easily understood by nonfinancial experts.

After efforts to develop an application took too long, Shaffer found Roambi, a data visualization app for iPads, in Apple's app store.

Roambi works with the credit union's main data engines for financial and historical analyses of budgets and forecasts and loan studies. Reports are used to monitor how economic indicators are affecting asset liability; monitor risks in loan distribution, concentration, delinquency and writeoffs; gauge revenue opportunities; and measure branch performance.

Roambi serves 47 users at American First CU. Users access financial information, which is presented graphically, as soon as the data are compiled.

To read the article, use the link.

Kansas appeals court ruling favors CU in state tax case

 Permanent link
WICHITA, Kan. (4/10/12)--A Kansas appeals court has overturned an order by the Kansas Court of Tax Appeals,  with the higher court saying that Wichita-based Cessna Employees CU (CECU) is exempt from a state retailers' tax on travel-related expenses that were passed on to the credit union in a vendor's invoice.

According to the ruling Friday by the Court of Appeals of the State of Kansas, Cessna had made a claim on June 30, 2008, for a $3,333 refund of the state taxes on travel, hotel and meals listed by an invoice from a service provider, Jack Henry & Associates (JHA), with whom the credit union had contracted computer upgrade services that required its employee to travel to Wichita.  JHA invoiced CECU for its services, hardware and software, and presented a separate invoice for the travel purchases (its employee's transportation, meals and lodging).  Cessna paid the invoice but sought a refund of the sales tax amount.

The state tax department denied the claim on June 30, 2008, and CECU appealed the denial on Nov. 11, 2008 to the department secretary, who upheld the department's denial on July 17, 2009. The $209 million asset credit union then appealed to the Court of Tax Appeals on Aug. 17, 2009,

The lower court said in its summary judgment that the travel expenses billed to the credit union were "part of the total amount of consideration given by CECU in the transaction for which the taxable goods and goods and services were sold" and thus subject to Kansas retailers sales tax as part of the 'gross receipts' of JHA in the transaction."

However, the Kansas Court of Appeals concluded there was no "sale" of the reimbursed travel expenses, and it reversed and remanded the case with directions to grant CECU's refund claim.

It said the amount invoiced was the original travel expenses plus sales tax paid, but with sales tax then computed on that total and billed for reimbursement to CECU. "The sales tax at issue here has been levied upon the total amount of consideration given by CECU in the transaction with JHA for providing the upgrades. In this transaction…we find that the travel is properly considered an expense incurred by the seller," the ruling said.

"We found no ambiguity in the statutory language as it applies to this case. Quite simply, there were no retail sales involving the travel expenses, so no retail sales tax may be applied to them--those taxes already having been fully paid by the end consumer of those expenses …," the ruling continued.

The higher court also noted that even if the statutes were ambiguous, "the rule of strict construction of tax imposition statutes must favor the taxpayer."

CU System briefs (04/06/2012)

 Permanent link
  • BRUNSWICK, Maine (4/9/12)--Marsha Richard of Topsham, Maine, has been ordered to pay full restitution to Brunswick-based Atlantic Regional FCU as the result of a $500,000 embezzlement from the credit union she worked with for 23 years.  Richard is serving a 33-month  prison sentence after pleading guilty in September to felony theft. She had agreed to pay $370,000, but a judge ruled last month she must pay the full amount. Richard has repaid $50,000 and would owe $468,000. She allegedly manipulated accounting entries for checks deposited by members that were returned for nonsufficient funds, said prosecutors. When the funds were collected, rather than crediting the account, she allegedly credited her account as well as family members' accounts (The Associated Press via The Republic April 6 and Times Record April 5) …
  • SUFFOLK, Va. (4/9/12)--A Smithfield, Va., man was sentenced to 10 years for the May 8, 2009, holdup of a Suffolk branch of Newport News, Va.-based Bayport CU (The Virginian-Pilot April 6). Terrell Jermaine Whitley, 25, was sentenced Wednesday to 20 years, with 11 years suspended, for robbery and sentenced to five years, with four suspended, for conspiracy. Whitley was convicted of the charges in March 2010.  He was allegedly the driver of the getaway vehicle …
  • YORK, Pa. (4/9/12)--York, Pa., police have issued a robbery arrest warrant for a man who is already in Daulphin County Prison on prison-escape charges. Angel M. Pomales Jr., 42, was arrested Tuesday for an escape charge and placed in the prison. He also faces charges in connection with a robbery April 2 at White Rose CU, York, and two bank robberies in Harrisburg, Pa., on March 14 and March 22.  During the credit union robbery, the suspect held a tissue over his face and presented a note demanding money. He did not display a weapon (York Daily Record April 4) …
  • EAST HARTFORD, Conn. (4/9/12)--A man has been charged with third-degree robbery and was being held on $75,000 bond in connection with a robbery Tuesday afternoon at American Eagle CU, East Hartford, Conn.  A robber had had entered the credit union and demanded "all your 20s," then fled with at least $500.  Robert Roy, 32, was taken into custody after witnesses identified a black Ford Probe as the getaway vehicle.  When he was arrested, he allegedly had $560 in $20 bills, said police. Another man was arrested on a possession of narcotics charge but released on a non-surety bond after police determined he had no part in the holdup (The Hartford Courant April 5) …

Texas Fla. Ala. step up advocacy on MBLs

 Permanent link
DALLAS and TALLAHASSEE, Fla. (4/9/12)--Government efforts to pump money into small businesses have not come close to the level of lending that small businesses need, but credit unions are prepared to lend more than $800 million to small businesses in Texas, said the Texas Credit Union League.

Several leagues have stepped up advocacy efforts to support the passage of a bill in the U.S. Senate (S.B. 2231 and S.B 509) that would give credit unions more ability to help the economy with small business loans.  "The increase in small business lending hinges on the passage" of the bill, which would raise the regulatory cap on credit union member business lending (MBLs) to 27.5% of assets from 12.25%.

"Credit unions make a real difference for small businesses," said Texas league President/CEO Dick Ensweiler. "We have been here when Texans needed us, and we are prepared to do more," he said in urging senators to "vote for Texas jobs and vote for this bill."

Florida and Alabama credit unions also have asked their senators to vote for the measure, said the League of Southeastern Credit Unions (LSCU).  It noted nearly 140 credit union officials from the two states participated in meetings with their legislators in Washington, D.C., in which they discussed increasing the MBL authority for credit unions, legislation to ensure more fairness in the exam process for credit unions, and legislation to allow credit unions to accept secondary capital.

Since the meetings, seven members of the league's two delegations have signed as co-sponsors of one or more of the bills for which credit unions sought support. After follow up conversations with other congressional offices, the league said it expects to see more members of Congress join the efforts.

The league  has a video message asking credit unions to contact their lawmakers. Jefferson CU, Birmingham, Ala., also produced an MBL video.  (To view them, use the links).

The Credit Union National Association (CUNA) and credit unions are in the midst of a national effort to get the MBL legislation passed soon in Congress.  By increasing the MBL cap, credit unions can help the country inject $13 billion available for small business lending.  That, in turn, would create 140,000 new jobs at no cost to the taxpayer.  Legislation to increase the cap is active in both the U.S. Senate and the House, and a vote on S. 509 is expected to take place after Congress returns from its spring recess, said CUNA.

Catalyst taps 12 pros for councils western region

 Permanent link
PLANO, Texas (4/9/12)--Catalyst Corporate FCU has tapped 12 credit union professionals to serve on the western regional component of the newly formed Catalyst Councils.

The western regional members become part of the 36-member Catalyst Councils program that was created to gather members' perspectives for the corporate's planning and decision-making.

Members appointed to the Western Regional Catalyst Council are:

  • Scott Waite, senior vice president/chief financial officer (CFO), Patelco CU, Pleasanton, Calif.;
  • Ron Neumann, CFO, Oregon Community CU, Eugene, Ore.;
  • Roger Ballard, CEO, NuVision FCU, Huntington Beach, Calif.;
  • Brian Hall, president/CEO, Foothill FCU,  Arcadia, Calif.;
  • Bonnie Humphrey-Anderson, executive vice president/CFO, OSU FCU, Corvallis, Ore.;
  • Doug Kileen, president/CEO, Safe 1 CU, Bakersfield, Calif.;
  • Patrick Vaughn, president/CEO, Idaho Advantage CU, Boise, Idaho;
  • Mark Morrison, CEO, MountainCrest CU,  Arlington, Wash.;
  • Rick Hanan, president/CEO, SMW104 FCU, San Leandro, Calif.;
  • Charles Papenfus, president/CEO, Inland Valley FCU, Fontana, Calif.;
  • Elizabeth Lipke, CEO, Bourns Employees FCU, Riverside, Calif.; and
  • Valerie Jensen, president/CEO, EW401 CU, Reno, Nev.
The western regional group will meet for the first time in late May.

MCUA 42 of Missouri members lack emergency savings

 Permanent link
ST. LOUIS (4/9/12)--An online survey of more than 1,100 Missouri credit union members indicates that 42% have no emergency savings.

The Missouri Credit Union Association (MCUA) statewide survey of members' saving and purchasing habits also revealed that less than 30% have enough savings to last four months or more.

Barry Brakeville, corporate communications director of $1.8 billion asset CommunityAmerica CU, Kansas City, Mo., said in an MCUA release that the survey should be a "wake-up call" for credit unions. He noted that "consumers should expect their financial institution to be a partner in helping them achieve financial freedom."

Many survey comments reflected that members are worried about their lack of savings and frustrated by an inability to save, with 58% reporting they were "not at all happy" with their savings balance. For example, one respondent commented, "It's impossible to save money if you can't get a job," while another responded, "We had a year's worth of savings before my husband lost his job." 

Financial experts typically recommend building an emergency savings account that can cover three months' worth of expenses. Heather DeMint, vice president of marketing at $117 million asset United CU, Mexico, Mo., said the credit union doesn't suggest an actual dollar amount for members to save, but instead encourages them to save on budget items such as insurance, cell phone plans and cable television.

"Credit reports can help consumers pinpoint ways to save," DeMint said. "Often times, we suggest debt consolidation via low-rate credit card or home equity lines of credit."

The survey collected members' responses throughout January 2012.

Minn. Family Involvement Council leads youth sessions

 Permanent link
EAU CLAIRE, Wis. (4/9/12)--The Minnesota Credit Union Foundation's Family Involvement Council (FIC) led two sessions during the "Co-ops YES!" Youth Leadership Conference, March 19-20, in Eau Claire, Wis.

More than 100 students from Minnesota and Wisconsin attended the "Co-ops YES!" Youth Leadership Conference in Eau Claire, Wis. Members of the Minnesota Family Involvement Council led two sessions during the event. (Photo provided by the Minnesota Credit Union Foundation.)
More than 100 high school students attended the event, hosted by the Cooperative Network, which serves more than 600 cooperatives--including credit unions--in Minnesota and Wisconsin.

The FIC's presentation, "Credit Unions: A Cooperative. A Career," focused on working with students to understand the benefits of credit unions and their belief in the cooperative philosophy of "people helping people." They also helped the group of high school juniors and seniors develop a vision for their future by discussing the types of careers available at credit unions.

"We made these sessions engaging and interactive for the students, and they offered intriguing questions about how credit unions operate and the emerging job possibilities available," said FIC Chair Bridget Moeller of Greater Minnesota CU, Mora, Minn. "We worked to impress on the students the credit union core values of equality, participation and mutual help, as well as how credit unions strive to improve the well-being of their members."

In addition to Moeller, FIC presenters included Shannon Butler of Postal CU, Woodbury, Minn., and Andrea Molnau of United Educators CU in Columbia Heights, Minn. As a way to promote the International Year of Cooperatives, along with the credit union difference, the group also discussed the concept of cooperatives and how credit unions fit into that mold. They also described the value that credit unions, and all cooperatives, provide within the financial marketplace.

The United Nations General Assembly has declared 2012 as the International Year of Cooperatives, highlighting the contribution of cooperatives to socio-economic development, particularly their impact on poverty reduction, employment generation and social integration.

This is the third year that the foundation's Family Involvement Council has participated in the Cooperative Network's youth leadership conference, which aims to build leadership skills that will offer opportunities to tomorrow's cooperative leaders.

TCUF offers 100 free fin lit webinars in April

 Permanent link
FARMERS BRANCH, Texas (4/9/12)--Through a grant from the Texas Credit Union Foundation (TCUF), the Consumer Credit Counseling Service of Greater Dallas (CCCS) will offer 100 free, live webinars throughout April in honor of National Financial Literacy Month. 

The 100 webinars will focus on 27 personal finance topics, ranging from credit scores and getting out of debt to buying a home and preventing foreclosure.

"The foundation is committed to building strong communities by supporting programs and initiatives that help to improve the financial circumstances of Texas families," said Courtney Moran, TCUF executive director. "Financial stability is an essential ingredient to maintaining a strong, healthy family unit."

Todd Mark, vice president of education for CCCS of Greater Dallas, said the agency wants to offer consumers additional, convenient educational resources so they can be empowered to make healthy financial decisions, and ultimately, achieve financial freedom.

Mark said the webinars would not have been possible without the support of the foundation.

Webinar topics are as follows:

  • Recession-Proofing Your Finances;
  • Surviving Financial Crisis;
  • How Do I Get Out of Debt?;
  • How Do I Save My Home from Foreclosure?;
  • 4 C's of Credit;
  • Student Loan Affordability;
  • College Credit 101: Entering the Age of Acquisition;
  • Building Wealth;
  • Asset Protection;
  • Life after Foreclosure;
  • Conquering Credit Scores and Reports;
  • Money Matters: Financial Success Begins Today;
  • So You Want To Be a Homeowner;
  • Dealing with Divorce;
  • Demystifying Reverse Mortgages;
  • Getting Ready for Baby;
  • The Psychology of Debt;
  • Couples and Money;
  • The Wedding Planner;
  • Lil Kids and Money;
  • Seniors, Money and Scams;
  • Grocery Shopping and Coupon Savvy;
  • Wheels You Can Afford: How to Buy a Car;
  • How to Spend Your Tax Refund;
  • Alternatives to Pay Day Loans;
  • Surviving and Preventing Identity Theft; and
  • Understanding the Credit CARD Act.
The Credit Union National Association (CUNA) sponsors the National Youth Saving Challenge during the month of April in celebration of National Financial Literacy Month. It is held in conjunction with National Credit Union Youth Week, also sponsored by CUNA, which will be held April 22-28, with the theme "Be a Credit Union Super Saver." Last year nearly 146,000 young members deposited $28.5 million into their saving accounts during National Youth Savings Week--with 9,058 new accounts.

TransUnion study Consumers pay auto loans first

 Permanent link
CHICAGO (4/9/12)--In 2011, consumers were more likely to pay their auto loans before their credit cards and mortgages, according to a TransUnion study.

The divergence in payment patterns--where consumers are increasingly apt to pay their credit cards before their mortgages--has continued for four straight years, according to TransUnion's Payment Hierarchy study update.

"The reversal in payment patterns between credit cards and mortgages has been well documented, but our findings were illuminating because it had not been previously clear that auto loans were considered a higher priority by consumers than both credit cards and mortgages," said Ezra Becker, vice president of research and consulting in TransUnion's financial services business unit.

"With unemployment remaining high and real estate values remaining stagnant or further depreciating, consumers continued to pay their credit cards ahead of their mortgages. However, the importance of their auto loans appears to have trumped even the value they place on their credit cards," Becker added.

The TransUnion analysis looked at a sample of roughly four million consumers in each quarter of 2011 who had at least one open auto loan, one open credit card account and one open mortgage. The study found in each quarter that there was a clear preference for remaining current on auto loans, ahead of credit cards and mortgages. Specifically, of the consumers who were delinquent on any of these products:

  • 9.5% were delinquent on an auto loan while current on their credit cards and mortgages;
  • 17.3% were delinquent on a credit card while current on their auto loans and mortgages; and
  • 39.1% were delinquent on a mortgage while current on their auto loans and credit cards.
"In other words, the auto loan is seldom the first choice when a consumer has to decide which payment to miss," Becker said.

This trend goes against the advice many credit union industry financial planners have given in the past--that mortgage payments should come first so the member doesn't risk losing the family home.

Auto loans have become the preferred payment because consumers need to get to work or look for employment. Also, a car loan is not a revolving loan--the impact of repossession is greater than the loss of a credit card, Becker explained.

"In addition, consumers may have equity in their autos after several years of payments that they are looking to preserve--which is no longer the case for most homes," Becker added. "In fact, negative equity has become increasingly common for homes, which may further contribute to the shift in payment preference to auto loans."

Newspaper Calif. members count on CUs services

 Permanent link
SAN DIEGO (4/9/12)--More Californians are counting on services from credit unions, according to a San Diego Business Journal (March 26) report about membership growth in the state.

Overall membership in the state swelled last year to about 9.7 million, an increase of 2% or 215,000 members, said the California Credit Union League in the article, "More Members Bank on Credit Unions' Services."

During fourth quarter, the state's credit unions added nearly 167,000 new members, but on a net basis the number was closer to 77,000, after counting attrition, said Diana Dykstra, president/CEO of the California and Nevada Credit Union Leagues.

Many of the gains occurred in late September/early October and involved moving accounts from the "Big Five"--Chase Bank, Bank of America, Citibank, Wells Fargo Bank and U.S. Bank--after large banks decided to charge customers for using their debit cards, Dykstra told the Journal.

The article noted that San Diego-based California Coast CU attracted about 11,000 new members during 2011, a 57% increase over 2010 membership gains. Its CEO, Marla Shepard, told the Journal that the growth was the result of growing dissatisfaction with bigger banks. About 75% of the new members opened a checking account and got debit cards, while 24% opened a loan. 

The newspaper also noted that the league and credit unions are supporting legislation to increase credit unions' member business lending (MBL) cap to 27.5% of assets from the current 12.25%.

Shepard said her credit union is prevented from making new small-business loans because it has already reached its MBL cap--about $230 million.  She noted that banks have cut back considerably on small business lending the past several years  and said credit unions should be given the ability to extend MBLs because there is a real need for the loans.

The Credit Union National Association (CUNA) estimates that increasing the MBL cap would mean $13 billion would be available for investing in new small business loans. That, in turn, would help create 140,000 jobs the first year, without costing taxpayers a dime, said CUNA. The U.S. Senate is expected to vote on a bill to increase the cap sometime after the congressional recess.

Vermont CUs have their day at the Statehouse

 Permanent link
SOUTH BURLINGTON, Vt. (4/9/12)--Credit union leaders gathered Wednesday at the Vermont Statehouse to hear speakers and meet with many of the state's 180 legislators.

Vermont State Speaker of the House Shap Smith speaks at the state's annual CUs in the Statehouse event. (Photo provided by the Association of Vermont Credit Unions)
Participants heard comments from State Senate President John Campbell and Speaker of the House Shap Smith, according to the Association of Vermont Credit Unions (AVCU).  Smith spoke about Hurricane Irene's impact on the state and the state's budgetary pressures.

Perspective on state and federal issues was also provided by Vermont Department of Banking, Insurance, Securities & Health Care Administration (now the Vermont Department of Financial Regulation)  Deputy Commissioner Tom Candon,  AVCU President Joe Bergeron, and the association's lead lobbyist, Adam Necrason.

The presentations and reception were preceded by AVCU's annual display in the Statehouse Card Room.  For more than three hours, a steady stream of legislators stopped by throughout the morning and early afternoon to discuss issues such as Americans With Disabilities Act (ADA) regulations, Internet lenders, state and municipal deposits, and the credit union marketplace.  They talked with AVCU Vice President Bryan Kent, Economy of Me Program Manager Colin Ryan, and AVCU Legal Counsel/Lobbyist Richard Brock.

"This is our most important state-level legislative event," said Bergeron of the annual CUs in the Statehouse day. He noted the support from credit union leaders to join the effort "to add significant impact to daily lobbying efforts. One-on-one connections made in a Statehouse social setting go much further than any laundry list of facts and figures we can produce, he said.

"Throughout all the years we've done this, legislators have become more aware of credit unions, more appreciative of the event itself, and have told us repeatedly how much they look forward to and enjoy it."

Former WesCorp officials ask court for jury trial

 Permanent link
LOS ANGELES (4/6/12)--Officials of the former Western Corporate FCU have filed amended counterclaims and a demand for a jury trial in the lawsuit filed against them by the National Credit Union Administration (NCUA). 

The counterclaims were made Wednesday before the U.S. District Court Central District of California in Los Angeles by two of the officials NCUA had sued--Robert A. Siravo, former president/CEO of WesCorp, and Thomas E. Swedburg, former director of human resources.

Their second amended answer and counterclaims docuoment seeks dismissal of the case, with prejudice, and asks the court to order that NCUA, as liquidating agent for WesCorp, reimburse Siravo and Swedberg for their defense costs, damages, and other court costs. The filed document said they had incurred more than $100,000 in attorney's fees and costs of their defense. Siravo and Swedberg also demanded NCUA indemnify them under Policy 21 adopted by WesCorp to so current and former officials and employees could recover costs and attorney fees in case of a lawsuit.

NCUA sued five WesCorp senior executives to try to recoup $6.8 million in investment portfolio losses from mortgage backed securities, alleging the executives were negligent in monitoring the corporate's investments. NCUA also alleged a breach of fiduciary duty and fraud related to the investments that contributed to WesCorp's collapse.

In earlier decisions last month U.S. District Judge George H. Wu  granted NCUA's motion to strike certain defense but allowed the executives to amend their arguments related to their indemnification claim.

The court document filed Wednesday by the WesCorp executives also addressed the issues of decision-making related to investments WesCorp purchased and to WesCorp's Supplemental Executive Retention Plans (SERPs). Siravo received a lump sum SERP payments in 2008 totaling $6.8 million and Swedberg received $1.2 million, the document said.

Siravo and Swedberg argue that they acted in "reasonable good faith reliance on the statements, representations, and approvals of others upon whom they were entitled to rely, including but not limited to the WesCorp Board of Directors, individual directors, other WesCorp officers, the ALCO [WesCorp's Asset and Liability Committee], rating agencies, underwriters, brokers, issuers, auditors, investment bankers, financial advisors, and counsel."

Iowa business owner Raise MBL cap

 Permanent link
IOWA CITY, Iowa (4/6/12)--The owner of an Iowa City bed and breakfast has written a letter to the Iowa City Press-Citizen, urging Congress to pass the legislation that would increase credit unions' ability to provide more member business lending (MBL).

Shirley Hendrickson wrote that when her family loved to Iowa City from Arizona several years ago, they purchased the Mission House Bed and Breakfast.

"We went directly to the credit union, and they learned with us and gave us the support we needed, personally and for our business," she wrote in Sunday's Press-Citizen

She noted that legislation is moving in the U.S. Senate "that would enable credit unions to make more loans to small businesses, like mine. This legislation would be a great help to credit unions. And the timing is certainly right. The additional lending authority would enable credit unions to do more of what they do best--make safe and sound to their members in this case members who are looking to start or expand a business."

"Credit unions stand ready to help" but are constrained by the current 12.25% of assets MBL cap. The bipartisan legislation introduced in the House and Senate would raise the cap to 27.5%.  She cited the Credit Union National Association's statistics:  passing the legislation would mean $13 billion more available for small businesses, providing capital to create 140,000 new jobs at no cost to the taxpayer.  "More than 2,000 of those jobs would be right here in Iowa," Hendrickson said.

"Congress needs to act," she urged. "With more capacity to make small business loans, credit unions such as mine can do more to help their members, spur the creation of new jobs and help accelerate our nation's economic recovery."

Use the link to read the full letter.  Also, see links to videos of Mike Kelley and Joe Trettel, two small business owners in North Carolina, talking about their support of credit unions in raising the MBL cap. News Now reported about their support in an article, "MBL push at state level grows, reported in media," on Thursday. Use the links.

Judge throws out ATM notice lawsuit vs. PSECU

 Permanent link
HARRISBURG, Pa. (4/6/12)--A federal judge in Harrisburg, Pa., has dismissed a lawsuit that had alleged a credit union violated the Electronic Funds Transfer Act (EFT) with improper ATM fee notification, saying in his ruling that the credit union showed undisputed evidence that an unknown third party had removed its posted notice illegally.

The suit was filed on May 24, 2011 by Gerald Rivello Jr., who withdrew funds from an ATM owned by Pennsylvania State Employees CU, a $3.8 billion asset credit union located in Harrisburg, on April 30, 2011, according to the court documents.

In the past two years, there has been a spike in the number of lawsuits filed by individuals against more than three dozen credit unions and banks based on missing ATM fee notifications. Some plaintiffs travel the country looking for ATMs without the proper notices attached, take photographs, and sue several financial institutions (News Now A.

In this suit, Rivello, who was not member of the credit union, alleged he was charged a fee for the transaction and alleged that at the time there was "no clear and conspicuous external notice at or near the ATM that a fee would or may be charged."

U.S. District Judge Robert D. Mariani, in a ruling issued March 28, ruled that Rivello failed to provide evidence rebutting the credit union's complete defense, citing section 1693 (h) of the U.S. Code, which says that if the required ATM notice has been posted by the operator in compliance with the law and the notice is subsequently removed, damaged or altered by any person other than the operator of the machine, the operator has no liability.

His ruling cited affidavits and photographs that indicated the credit union posted a compliant fee notice to the ATM in 2006, that none of the credit union's employees removed the ATM fee notice, and when employees discovered the sticker was missing during a routine examination of the machine, they promptly affixed a new notice to the ATM.

The credit union testified that on February 2011, it initiated procedures to provide for routine inspections of its ATMs to ensure the compliant notices were posted. On May 12, 2011, an employee noticed the machine did not have a properly affixed fee notice and replaced it and other signage on the ATM and photographed the machine.  After the complaint was served another employee photographed the machine on Aug. 9, 2011 and the photo showed old adhesive next to the existing fee notice, which showed an earlier fee notice had been affixed.

"These affidavits present facts, which if unrebutted, require a finding that some third-party, and not the defendants, removed the required fee notice from the ATM," said the judge's ruling.  Rivello failed to offer evidence that would cast doubt on the defense and did not offer a rebuttal beyond merely stating the factual allegations from his original complaint. "Plaintiff's papers and submissions to this court fail to provide any evidence rebutting [the credit union's] defense beyond the assertion that the ATM did not contain the appropriate fee notice. Such submissions do not constitute evidence of a disputed fact."

A rash of lawsuits in 2010  prompted CUNA Mutual Group to warn credit unions to develop and write procedures for regularly inspecting their ATMs to ensure their signs are posted, to photograph the ATMs at the time of inspection, and to maintain the inspection log for all ATMs and have credit union management review the log (News Now April 25, 2011).

Former Coastway CU applies for stock IPO

 Permanent link
CRANSTON, R.I. (4/5/12)--Coastway Community Bank, which converted from Coastway CU to a banking charter in 2009, is seeking regulators' approval to form a depositor-governed mutual holding company.

Creating a mutual holding company typically allows banks to shift to stock ownership through an initial public offering (IPO). A Coastway release said the mutual holding company would be a separate legal entity that would own and control the bank as a subsidiary (Providence Business News April 4).

Depositors will vote on Coastway's plan later this month. The reorganization would then become subject to approval by the Federal Reserve Board, the Federal Deposit Insurance Corp. and the Rhode Island Department of Business Regulation.

Coastway stated it intends to use the reorganization to expand financial products and services, expand its capital base and establish relationships with other banks and financial service providers.

PCUA CRIF Lending deliver merchant lending

 Permanent link
HARRISBURG, Pa. (4/6/12)--A new partnership between the Pennsylvania Credit Union Association (PCUA) and CRIF Lending Solutions, Atlanta, will help Pennsylvania credit unions compete with finance companies for merchant lending.

A PCUA release stated the partnership will provide full-service, outsourced merchant lending to enable credit unions to offer 24/7 instant financing on products ranging from ATVs to swimming pools to online jewelry sales. 

The point-of-sale financing solution aims to ease credit unions' entry into a new market by handling every aspect of merchant lending, including merchant sourcing and sign-up, contract funding and disbursement.

Collection tactics prompt Dykstra letter to iAmer. Bankeri

 Permanent link
ONTARIO, Calif. (4/6/12)--The April 4 edition of American Banker included a letter to the editor from Diana Dykstra, in which the president/CEO of the California and Nevada Credit Union Leagues admonishes financial institutions to not victimize their members and customers with inaccurate record keeping.

Dykstra praised the Banker for an article which revealed that Bank of America knowingly sold credit card receivables that contained inaccurate information to a collection agency.

"My first instinct as a credit union CEO is to say that more banking institutions need to stop looking at their customers as just numbers on a balance sheet," Dykstra wrote.  "At credit unions, one tends to find far less of this activity, because our organizations are so people centric. Indeed, our institutions are owned and operated by our own members. The people who belong to the organization also serve the organization."

The article should serve as a wake-up call to the financial services industry, Dykstra said.

Financial institutions should focus on providing service to their members and customers, she added.

To read Dykstra's letter to the editor, use the link.

Filene report examines highly effective CU managers

 Permanent link
MADISON, Wis. (4/6/12)--Because they must learn quickly and solve problems effectively, about 87% of middle managers are above average learners, according to a recent study conducted by the Filene Research Institute.

The results of the survey--and the implications for credit unions--are described in Filene's latest report, "Attributes and Skills of Highly Effective Credit Union Managers," written by Michael Neill, president and founder of Michael Neill & Associates Inc.

Filene said the report can be used as a tool in hiring and promoting credit union middle managers.

The study also identifies other traits of effective middle managers, including:

  • Energy: The "tendency  to display endurance and capacity for a fast pace" is a key characteristic, with 86% of middle managers scoring above the average employee.
  • Decisiveness: Using the available information to make decisions quickly is critical, with 80% of respondents above average.
  • Verbal skills: Among effective middle managers, 69% are above average in verbal skills, making them better able to communicate with members, subordinates, peers and executives.
Also noted in the survey is where the group scores below average employees. Being lower than average is not negative; it highlights traits where good middle managers are atypical, according to the study. These traits include:

  • Objective judgment: Great middle managers are far less likely than average employees to rely solely on data in decision making. About 79% fall at or below the average, indicating a strong reliance on intuition.
  • Manageability: Highly effective managers want their own leaders to define outcomes and then let them complete those goals with relatively free rein--72% score below average in manageability.
  • Accommodation. Good middle managers are significantly less accommodating than the norm. With 73% scoring below average, good middle managers know where they shouldn't go with the flow.

Polands Buczkowski to keynote WYCUP at World CU Conference

 Permanent link
GDAŃSK, Poland (4/6/12)--Grzegorz Buczkowski, president and chair the Cooperative Savings and Credit Union Mutual Insurance Society (TUW SKOK), a World Council of Credit Unions' (WOCCU) associate member organization in Poland, will keynote this year's WOCCU Young Credit Union People (WYCUP) program.

The WYCUP program will be held in conjunction with the World Credit Union Conference, July 15-18 in Gdańsk, Poland.

Buczkowski didn't know he was headed down a credit union career path when he was hired in 1990 as a translator by Poland's Solidarity movement. At the time, a delegation from the trade union that helped overthrow communism was searching for an alternative to a financial service industry left in ruins by the departing communist government. Buczkowski helped bring together parties from Poland and the U.S. to create one of the world's fastest-growing and most successful credit union movements.

But in 2001, Buczkowski won a scholarship from the WOCCU WYCUP that helped set him on his career path. "Participating in WYCUP gave me the opportunity to network, exchange ideas and create professional relationships that have lasted to this day," said Buczkowski. "The experience was, to me, priceless."

The program, designed for credit union professionals and volunteers under the age of 35, provides specialized educational and networking sessions, and allows participants to participate in the conference networking and general sessions. Five WYCUP participants will receive scholarships that provide all-expense-paid trips to the 2013 World Credit Union Conference in Ottawa, Canada.

The WYCUP program seeks individuals who have already made significant contributions to the development of their own credit unions or regional/national credit union systems and have demonstrated the potential to employ their unique talents at the international level. Credit unions and credit union organizations that are World Council members can nominate young leaders to compete for a WYCUP scholarship.

To be eligible for the scholarship, nominees must:

  • Be sponsored by their credit union or credit union organization to attend this year's World Credit Union Conference in Gdańsk;
  • Be 35 years of age or under as of Jan. 1, 2012; and
  • Submit a completed nomination form to World Council with all supporting materials by June 1.

Mich. league CEO is SBA National Fin Services Champion

 Permanent link
LANSING, Mich. (4/6/12)--David Adams, president/CEO of the Michigan Credit Union League (MCUL), has been recognized by the U.S. Small Business Administration (SBA) as the 2012 National Financial Services Champion for his advocacy and work to increase small business lending at a time when access to capital is a national challenge.

The recognition of Adams marks the first time in recent memory that a credit union representative has been honored as a financial services champion for small businesses.

"Your hard work, innovative ideas and dedication to your community have helped you succeed," SBA Administrator Karen G. Mills wrote in the letter announcing the award. "The SBA is pleased to recognize your achievements and your role in driving our nation's economic growth."

Adams also received the state-level Financial Services Champion award from the Michigan Celebrates Small Business organization, made up of the U.S. SBA, the Michigan Economic Development Corp., the Small Business Association of Michigan,  Greater Lansing Business Monthly, the Edward Lowe Foundation and the Michigan Small Business & Technology Development Center.

During Adams' tenure, Michigan credit unions' small business loans have increased by an average of 21% annually in the past five years--more than quadruple the U.S. credit unions' 2011 growth rate of 5.1%. This comes during tough economic times when most banks were pulling back on business lending.

Nationally, credit union member business lending (MBL) has increased by nearly 45% between 2007 and 2011, while business lending by banks fell nearly 15% during that period, according to the Credit Union National Association (CUNA).

MCUL has been a strong advocate for efforts to strengthen small business lending, including calling for passage of a bipartisan plan to increase the arbitrary cap on credit unions' MBL from 27.5% of credit union assets to 12.25%. CUNA estimates that this member business lending increase would create 140,000 jobs and inject $13 billion in new funds into the economy, at no cost to taxpayers.

The Credit Union Small Business Jobs Bill (S. 2231/H.R. 1418) has the support of U.S. Sens. Carl Levin and Debbie Stabenow, and nine of Michigan's 15 members of Congress, including Reps. Gary Peters, Thaddeus McCotter and Bill Huizenga, who sit on the House Financial Services Committee. The legislation is expected to come before the full Senate in the next few weeks.

"For me to be recognized as the financial services champion by the U.S. Small Business Administration as well as the state level Financial Services Champion award from the 'Michigan Celebrates Small Business' consortium, truly is a testament to the good works of credit unions on behalf of small businesses," Adams said. "Whether working to pass important enabling legislation like the Credit Union Small Business Jobs Bill or the recently passed Small Business Lending Fund Act (H.R. 5297), MCUL and CUNA are strong advocates for expanded credit union business lending authority for all lenders. The league's other efforts to showcase and expand our credit unions' commitment to business lending are the basis for this wonderful recognition from the Small Business Administration, which I consider to be a team award for our industry."

Latino CU Conference to be held with CUNAs ACUC

 Permanent link
MADISON, Wis. (4/6/12)--The Network of Latino Credit Unions & Professionals' (NLCUP) Seventh Latino Credit Union Conference will be held in conjunction with the Credit Union National Association's (CUNA) 2012 America's Credit Union Conference (ACUC).

The NLCUP conference will take place, June 15-17 in San Diego, immediately before the ACUC, June 17-20. Conference information and registration can be found at acuc.cuna.org under preconference events. To encourage communication and networking between the two conferences, NLCUP conference attendees will receive a $200 discount off ACUC registration.

"Our goal is to help credit union leaders connect with the greater Latino community and raise awareness amongst the credit union community of the incredible opportunities that exist in serving the Hispanic market," said Maria Martinez, NLCUP chairman. "The momentum-driving content and leadership focus of ACUC is a perfect match with our vision for a more vibrant Latino presence in credit union movement."

NLCUP was created to expand the market share of credit unions serving Latino communities and to increase Latinos' representation and participation in the credit union movement.

The NLCUP conference is designed to help Latino credit union professionals gain exposure in the larger credit union movement and forge connections among fellow Latino credit union leaders. This year's conference theme, "Creating Opportunity ~ Creando Oportunidad," will feature journalist, author and performer Ruben Martinez and nationally syndicated journalist Ruben Navarette Jr. In addition, the conference will offer workshops and events in partnership with major system players.

"CUNA is committed to enriching our credit unions' relationships with Latino professionals and the larger Hispanic community," said Bill Cheney, CUNA president/CEO. "We are delighted that this year's NLCUP meeting is co-located with ACUC, and I expect there to be powerful synergies between the two events. This is a great opportunity for our two organizations to strengthen and grow the credit union industry."

Keynoting this year's ACUC in San Diego are business innovator and author Tom Peters; USAF pilot and philanthropist Major Dan Rooney; science-based marketer Sally Hogshead; bestselling business, technology and media author Chris Brogan; and a surprise keynoter, to be announced soon.

Merger OKd in Pa. another set for Texas

 Permanent link
TREVOSE, Pa., and HOUSTON, Texas (4/5/12)--Two mergers of credit unions in Pennsylvania and Texas are in the works.

The Pennsylvania Department of Banking approved on Sunday the merger of $1.3 million asset Kenrick FCU, Bryn Mawr, Pa., with TruMark Financial CU, a $1.36 billion asset credit union in Trevose, announced TruMark Financial in a press release.

The merger provides the former Kenrick members access to an expanded branch network and a wider menu of financial products and services, said TruMark Financial.  The new members will have access to consumer loans, first mortgages, and insurance and investment products, as well as online and mobile banking services and a large surcharge-free ATM network.

In Texas, Houston-based Space City CU, with more than $34 million in assets, said it plans to merge this year with Independence Parkway FCU, a $21 million-plus asset credit union located in La Porte.

Combined, they will serve 8,200 members and have more than $56 million in assets (Houston Business Journal Online March 30).  The  challenging economy prompted Independence Parkway to merge as the best move to provide its members with quality services, said a statement by Space City in the article.

With the merger, members will have access to branches in downtown Houston, the Galleria area, and in La Porte, as well as access to mobile banking, online check deposit, free checking and business services.

Kansas CUs finish 2011 on strong note says KCUA

 Permanent link
WICHITA, Kan. (4/5/12)--Kansas credit unions finished 2011 with high growth rates in loans, assets, shares and members, according to the Kansas Credit Union Association's  (KCUA) Quarterly Performance Summary for fourth quarter 2011.

Loan growth continued, with a 5.88% increase--five times the national average--over fourth quarter 2010, said KCUA. Used-auto loans and mortgages were the leaders in the loans category.  Used-auto loans grew 8.5% annually, offsetting a 4.7% in new-auto balances. 

Credit unions in Kansas originated $354 million in first mortgages during the year, nearly 22.5% of total loan originations. The fourth quarter of 2011 was one of the strongest quarters for first mortgage originations in Kansas credit union history, with more than $120 million loaned out. This was the second highest quarter in more than five years, since $128.8 million was originated in fourth quarter 2010, said KCUA's report.

Shares or savings increased nearly 8% last year, to $4.1 billion deposited with credit unions. Checking shares showed the largest percentage increase, up 15.6%.  The checking penetration also increased, indicating more credit union members are opening checking accounts, the association said.

Membership rose 2.4% --to 627,564--with Kansas credit unions adding 14, 638 members during the year, compared with the national average of 1.4%.

"Kansas credit unions remain strong, especially in light of our economy," said Bob Mayes, vice president of Member and Strategic Services at KCUA.  "With unemployment declining, delinquency and losses seem to have stabilized. Our used-auto loan growth continues to be high, balancing new-auto loans, which have declined in 2011," he added.

CU System briefs (04/04/2012)

 Permanent link
  • KANSAS CITY, Kan. (4/5/12)--Vershon Moore, 21, a former all-conference running back at Washburn University in Topeka, was sentenced this week to 30 months in federal prison for his role in robbing a credit union last summer.  A co-defendant in the case, Tracie Bacon, worked at the Topeka credit union that was targeted and admitted to helping plan the robbery. She also was sentenced to 30 months in prison. Press reports referring to a news release from the U.S. attorney's office said both Moore and Bacon pleaded guilty to one count each of bank robbery. Moore admitted he held up two employees at Envista CU, of Topeka, as they worked to refill an outdoor ATM machine. It was reported that Bacon gave Moore the schedule for ATM refills, as well as texted him shortly before the robbery. The pilfered funds were found by investigators in Bacon's basement (Kansas City Star and The Capitol Journal April 2)…
  • ELIZABETH, Pa. (4/5/12)--Clairton Works FCU, Elizabeth, Pa., has reported that fraudulent checks, bearing the credit union's routing number but an invalid account number, have been issued to hotels and motels. Clairton has received account verification requests and checks presented in the name of Thomas Johnson Inc. of Alpharetta, Georgia. However, the credit union does not have business accounts. No losses to the credit union have occurred (Life is a Highway March 30)…

Pelican State CU transfers branch to Eagle FCU

 Permanent link
CHALMETTE, La. (4/5/12)--A branch acquired to help credit union members in the wake of Hurricane Katrina is being transferred from $191 million asset Pelican State CU to $92 million asset Eagle FCU as of April 17. Both credit unions are based in Baton Rouge, La.

Pelican State CU acquired the branch in Chalmette, La., through a merger with Chalmette Refinery CU, which was in danger of closing after Hurricane Katrina.

In a Pelican State CU release, CEO Jeffrey K. Conrad noted that while Chalmette Refinery CU's members needed a helping hand, Pelican State's strategic plan did not call for growth in the greater New Orleans area.

The release noted the branch is being transferred to Eagle FCU because Chalmette members can benefit from a credit union with a larger presence in the community and plans for growth in that area.

Conrad noted the branch and accounts will not be sold for a profit, but transferred in an "even exchange." Eagle FCU intends to retain all Pelican employees and members.

Eagle FCU CEO Ginger Manint said the transfer demonstrates both the cooperative spirit of credit unions and decision-making that is in the best interest of members.

INerdWalletI promotes CUs checking accounts as top picks

 Permanent link
SAN FRANCISCO, Calif.  (4/5/12)--Checking accounts at America's credit unions offer "free checking with good karma," according to consumer financial website NerdWallet.

In a recent blog post, NerdWallet highlighted the advantages of credit unions' checking accounts and other products when compared to banks. The April 2 blog post honored six credit unions for offering "top" checking account options:

  • Members 1st CU, Redding, Calif., offers its "Basic Checking Account" with no minimum transaction level to save households an average of $150 per year. E-statements are required, but the account also offers free bill pay and free access to MoneyDesktop, a personal financial management tool.
  • 3Rivers FCU, Fort Wayne, Ind., has "Livin' Free Spending" accounts to provide free access to ATMs through two major networks, shared branching and  "Oops Refunds" that repay penalty charges up to three times a year for up to $30 per refund.
  • San Diego County CU, San Diego, Calif., requires only $25 to open the account, which includes online banking and bill pay and offers mobile deposit via smartphones.
  • Randolph Brooks FCU, Universal City, Texas, provides 10 cents cash back on all debit card purchases on top of a 0.15% annual percentage yield (APY) on balances. Free standard checks are provided for online orders. E-deposits are available with a smartphone or scanner, balances are provided on mobile phones, and free e-alerts send text messages about account activity.
  • First Abilene FCU, Abilene, Texas, comes with two annual fee refunds, a consumer loan discount and no limits on checks or withdrawals.
  • Northern FCU, Watertown, N.Y., offers ATM refunds as well as 2.01% APY on balances up to $25,000 for accounts that qualify by using e-statements, accessing online banking at least monthly and having one automatic payment or direct deposit each month.
NerdWallet noted that while banks are increasing fees, credit unions are "rolling out the welcome mat" for new members.

"In the ongoing battle of credit union vs. bank, credit unions almost always come out ahead," NerdWallet reminded readers.

To read the full article, "Top Free Checking Accounts at Credit Unions," use the link.

WOCCU extends leadership program deadline to April 20

 Permanent link
MADISON, Wis. (4/5/12)--The World Council of Credit Unions has extended the application deadline for the latest phase of its International Leadership Program to April 20.

The International Credit Union Leadership Program, which promotes internships for young credit union people from various countries, is designed to facilitate idea exchanges, promote foreign language skill development, enhance cultural diversity and improve problem-solving within a global credit union context.

MBL push at state level grows reported in media

 Permanent link
CHARLOTTE, N.C. (4/5/12)--Small businesses in North Carolina are supporting credit unions' push to get passage of the bill that would increase their member business lending (MBL) cap, according to a report in The Charlotte Observer.

Several small businesses described to the Observer (April 4) how credit unions saved their businesses after they were turned down by banks. They support a bill before Congress that would enable credit unions to make more small business loans by increasing credit unions' MBL cap to 27.5% of assets from the current 12.25% so credit unions can make more small business loans.

For example:

  • David Settle, who owns a heating and air conditioning company, decided to refinance with Truliant FCU, Winston-Salem, because it was eager to loan to him while banks have not been willing to work with people, he told the newspaper.
  • Joe Trettel, managing partner of aluminum product manufacturer Permatech Inc., near Greensboro, said he laid off half of his 105 employees and was on the verge of collapsing when Truliant FCU gave him a loan. Now the company is back at full strength.
  • Victor Lytvinenko, co-founder and designer of Raleigh Denim, who received a $10,000 loan in 2009 from Coastal FCU,  Raleigh, has grown into a 24-employee company.  He told the newspaper his business grew in the middle of the credit crunch mostly because the credit union worked with it.
  • Jim Dobbins, Sharp Interiors Inc., Winston-Salem, said his bank dropped him and seven other banks turned him down. His company, which earns about $10 million a year, was picked up by Allegacy FCU, Winston-Salem. "I'm with a credit union because they were the only alternative I had," Dobbins told the newspaper. "Without them, I wouldn't be here."
The article noted that several North Carolina credit unions are bumping up against the cap, or close to it. It cited the Credit Union National Association's (CUNA) statistics: credit unions hold about $40 billion in business loans, less than 6% of all small-business loan. Dan Schline, senior vice president of association services at the North Carolina Credit Union League,  said the total has grown more than 44%.

If the cap is increased, North Carolina would likely see an additional $200 million in loans closed, creating 2,100 jobs, the league said.

CUNA projects that increasing the cap would inject $13 billion in new investments in small businesses, creating 140,000 jobs at no cost to the taxpayer.

WOCCU supports global AML reg revisions

 Permanent link
PARIS (4/5/12)--The World Council of Credit Unions (WOCCU) Tuesday said it strongly supports revisions to regulations developed by the Financial Action Task Force (FATF) designed to combat money laundering and terrorist financing, and supports the FATF's revised due diligence recommendations that can be scaled to acknowledge credit union members' relative lack of risk in these areas.

Click to view larger image World Council of Credit Unions' Michael Edwards (left) and Credit Union Central of Canada's David Phillips represented financial cooperatives to support revisions of regulations developed by the Financial Action Task Force designed to combat money laundering and terrorist financing. Edwards and Phillips also promoted credit unions' low-risk as money laundering targets. (Photo provided by the World Council of Credit Unions)
World Council representatives spoke to this issue at an April 2 FATF meeting at the Paris headquarters of the Organization for Economic Cooperation and Development, where the inter-governmental regulatory body is domiciled.

More than 100 participants attended the two-day meeting to discuss revisions to FATF's International Standards on Combatting Money Laundering and the Financing of Terrorism and Proliferation, better known as the 40 recommendations. WOCCU supports the recommendations overall, and especially the FATF's revised customer due diligence (CDD) recommendations that should apply to the relatively low-risk scenarios offered through credit unions, according to Michael Edwards, WOCCU chief counsel and vice president for advocacy and government affairs.

"World Council strongly supports the FATF's recommendations and interpretive notes regarding simplified CDD measures for lower risk customers and transactions," said Edwards, who represented the global credit union trade organization with David Phillips, president/CEO of Credit Union Central of Canada, a World Council member organization. "We asked the FATF to consider issuing additional guidance on this issue to help reduce regulatory burdens on credit unions when there is no indication of money laundering or terrorist financing."

The revisions WOCCU supports recognize the relative lack of risk generally offered by credit union members and their transactions. As natural-person financial cooperatives, credit unions do not serve corporate entities with opaque ownership structures that might easily hide criminal money laundering or terrorist activities, said WOCCU.

Language already exists within the CDD recommendations offering a simplified approach, which WOCCU believes will reduce regulatory burdens to levels appropriate to the general risk found in credit unions, Edwards explained. FATF reacted positively to WOCCU's comments, noting that while a simplified CDD could not uniformly apply to all credit unions on an institution-wide basis, national or provincial regulators could reduce regulatory burdens on credit unions in cases where members were likely to be low-risk.

FATF's revisions also indicate further recognition that credit unions generally pose less risk overall due to their cooperative nature and the role played by their member-owners, according to Brian Branch, WOCCU president/CEO.

"We urge FATF to recognize the value of financial cooperatives' relationships with their members through the simplified customer due diligence revisions," said Branch. "Credit unions continue to be a positive global economic force and recognition of that role by global regulatory bodies is necessary to maintain and protect that positive role that financial cooperatives fulfill."

Texas tornado destroys home of CU employee

 Permanent link
MADISON, Wis. (4/5/12)--The home of at least one Texas credit union employee was destroyed by tornadoes that swept through the Dallas-Fort Worth area Tuesday. However, Texas credit unions appear to have escaped major damage.

One tornado destroyed the home of an employee of City CU in Dallas, and another employee was temporarily displaced when an apartment building was damaged, the Texas Credit Union League told News Now.

"It's devastating," Taunya Williams, City CU chief marketing officer, said of the employee's loss. Williams said the credit union is opening an account to accept donations for the employee. Other employees have offered to volunteer with clean up and other assistance.

CUNA Mutual Group's Credit Union Protection Claims unit contacted credit unions in the disaster area, and there were no reports of any major damages to credit unions, said Phil Tschudy, CUNA Mutual Group's media relations manager. A few credit union locations sustained some wind and hail damage to their facilities, but these were minor in relation to other damages in the affected areas.

A branch of Neighborhood CU received roof and window damage, Carolyn Jordan, senior vice president at the credit union, told News Now. The glass door of a community room was also blown out, Jordan said.

About 20 vehicles owned by employees of YOUR Community CU in Irving, Texas, suffered hail damage, according to Rick Stokes, assistant vice president of marketing at the credit union. Although the area wasn't hit by tornadoes, storms did bring golf ball-sized hail, which broke windshields and dented vehicles, Stokes said.

The YOUR Community CU branch in Irvine does not appear to have been damaged, Stokes said. "We seem to have been right on the edge of the tornadic activity," Stokes said. "A block away there was no hail."

The Texas league told News Now it had been in contact with member credit unions throughout the Dallas-Fort Worth area. The area was hit by an estimated 18 tornadoes, according to PropertyCasualty360.com.

TCUL spokesperson Linda Webb-Manon said she expects to hear from credit unions with members who were affected by the tornadoes. The American Red Cross estimates 650 homes were damaged in the Dallas-Fort Worth area on Tuesday.  

"It usually takes a couple days to get reports credit unions, but we expect more people will need some help," Webb-Manon said. "The tornadoes hit a heavily populated area, and we know there were extensive damages to some residential areas."

Texas Credit Union Foundation said it is ready to implement phase one emergency grants to any credit union employees affected by the tornadoes (Lone Star Leaguer April 4).

Phase one emergency grants are provided to credit union employees to assist with immediate disaster relief needs, such as out of pocket costs that may result from being evacuated. The grants are up to $500 per credit union employee. The grants are provided to help stabilize credit union employees' individual situations so they can return to work.

Although her credit union escaped damaged, Stacey McDonald, CEO of Corner Stone CU, in Lancaster—the hardest hit area, according to USA Today--saw one of the tornadoes first hand about a mile from her credit union as she stood outside the branch.

"We are just lucky we didn't get any damage," McDonald said. "The area just up the street did."

McDonald directed about 12 employees and three members--including her pregnant daughter--into the credit union's restrooms until the storms passed.

One employee was frantic because she heard the tornado was headed directly for her neighborhood, McDonald recalled. "But somebody called to tell her that it bounded over the neighborhood just like a frog," McDonald said.

The American Red Cross estimated that about 300 Lancaster homes were damaged.

"As a financial institution, we will do whatever we can to help," she said. "Right now I feel like someone was looking out for us."

Catalyst Councils hold preliminary meetings

 Permanent link
PLANO, Texas (4/5/12)--Nearly two dozen credit union officials--representing the membership of Catalyst Corporate FCU in the central and eastern regions of the U.S,---met last week to offer their perspectives on topics such as mobile banking and person-to-person payment initiatives; enterprise risk management concerns and member satisfaction surveys.

Attendees were members of the newly formed Catalyst Councils, which focus on service delivery, product development and enhancements, and "over-the-horizon planning," said Kathy Garner, Catalyst Corporate FCU president/CEO.

"There was a good mix of topics to cover, and the participation among the council members was well-balanced," said Sam Whitehurst, president/CEO of the $135 million Summit CU, in Greensboro, N.C. and a representative of the Eastern Catalyst Council. "I think the council members rallied around the Catalyst spirit of member-ownership, so everyone was engaged in a meaningful way."

Catalyst Corporate was launched last September with 860 member credit unions that contributed nearly $90 million in capital. Catalyst's credit union membership now approaches 1,200, with $139 million in capital.

"From the start, the Catalyst team has understood the importance of building upon a member-focused culture," Garner said. "This council process deepens the cooperative relationship between member credit unions and staff as they work side-by-side to set and achieve organizational objectives."

Garner noted that the council input will help Catalyst align its offerings with member credit unions' own strategic plans. "Catalyst Councils will serve as a springboard for member-driven service enhancements, and help ensure that resources are allocated to projects that members need and appreciate," Garner added.

Catalyst will soon announce the formation of a third council to represent credit unions in the western region of the U.S. The corporate had delayed formation of the Western Council to accommodate credit unions migrating to Catalyst Corporate as a result of the National Credit Union Administration's wind-down of Western Bridge Corporate.

Two re-elected to PCUA board

 Permanent link
HARRISBURG, Pa. (4/5/12)--The results of a recent director election for positions on the Pennsylvania Credit Union Association (PCUA) Board of Directors have been announced by board Chairman Michael Kaczenski.

She will represent credit unions in Asset Category 2, with total assets of more than $30 million to $100 million.

Ray Brunner, CEO of  the $179 million asset WEST-AIRCOMM FCU, located in Beaver, Pa., has been re-elected to the board and will represent credit unions in Asset Category 3, total assets greater than $100 million.

Their three-year terms will begin after PCUA's Annual Convention in May.

Dakotas associations new campaign draws media

 Permanent link
BISMARCK, N.D. (4/5/12)--The Credit Union Association of the Dakotas' (CUAD) press conference this week announcing the launch of its new awareness campaign drew the attention of Bismarck, N.D., media, says CUAD.

Click to view larger image Robbie Thompson, left, president/CEO of the Credit Union Association of the Dakotas, talks with television station reporters at a press conference launching the "We've Been Waiting For You" campaign to create awareness about the benefits of credit unions in North and South Dakota.(Photos provided by the Credit Union Association of the Dakotas)
Click to view larger image Flanking "The CU on the Road" vehicle that the Credit Union Association of the Dakotas will use to promote the benefits of credit unions in North and South Dakota are, from left: CUAD President/CEO Robbie Thompson; Vice President of Advocacy/Awareness Jeff Olson; Board Chairman Steve Davis; Director of Strategic Initiatives Kristie Heit; and CUAD staffers Karla Clark, Shawn Brummer, Deb Kruckenberg, Joell Kautzman, Amy Jo Johnson and Steve Rahrich.
The event launching "We've Been Waiting For You" was "well-covered by local media, including two local television stations," the association said.

The campaign goal is to create awareness about the benefits of credit unions across North and South Dakota.

"This is a unique campaign in our region," said Robbie Thompson, CUAD president/CEO.

"'We've Been Waiting For You' is about credit unions in North and South Dakota coming together as one to spread the beneficial credit union message," he said.

The campaign relies on testimonials from credit union members in the two states, describing experiences they have had with their credit unions. The testimonials will be incorporated into television and radio spots as well as the campaign's website. Use the resource link for more information.

"Another vital aspect of the campaign will be a grass roots road tour called 'CU on the Road,'" said Thompson.  "CUAD staff will be traveling in our CU on the Road vehicle across both states to meet with the public and talk about the benefits of credit unions."

The road tour kicks off April 17 and runs the rest of the year. Other tour stops include Bismarck, Grand Forks, Rapid City, Sioux Falls and more. Use the link for the full schedule.

CUAD will be conducting a second press conference later this week in Fargo.

CUs help Mexican banana growers prosper

 Permanent link
COAHAYANA, Mexico (4/5/12)--The World Council of Credit Unions (WOCCU)  is working with Caja Providencia, a local credit union, to develop a value chain financing program that ensures that banana growers in Mexico's Michoacan state get a fair market price for their crop to better support themselves and the local economy.

Click to view larger image Dora Leticia Garibo, an acopiador, or collection and processing agent, supports the value chain network launched by World Council of Credit Unions with Caja Providenica to assure banana growers in rural Mexico get fair prices for their crops.
Value chain financing provides financial infusion to farmers at key points in the planting, growing and harvesting cycle so they have sufficient funds to operate their businesses.  Acopiadors, or collection and processing agents, serve as the link among the grower, the buyer and the credit union, through which funds are provided,to support the farming cycle. Farmers who are Caja Providencia members can become part of the value chain process and gain access to additional credit union services.

"The value chain model has worked well to support rural growers, producers and craftspeople throughout Latin America," said Brian Branch, WOCCU president/CEO. "The partnership with Caja Providencia has made a positive difference in the lives of the members involved in this program."

The partnership is part of WOCCU's five-year Cooperative Development Program (CDP), supported by $4 million in funding from the U.S. Agency for International Development.  The program focuses on creating and testing agricultural and financial tools to improve rural economic and financial sector development, personal income and food security. Results from the program, which runs through 2015 and also operates in Guatemala, will include a scalable methodology to increase small farmers' access to markets, inputs and technical assistance.

The programs benefit credit unions by increasing member growth and participation. Caja Providencia, which serves 40,000 members, provides funds for the value chain model and provides the organization necessary to secure market-based prices from buyers.

Click to view larger image Teams of workers, called cuadrillas, spend entire days loading up to 23 tons of bananas into semi-trailer trucks for shipment to market in Mexico.(Photos provided by the World Council of Credit Unions)
WOCCU's partnership with Fideicomisos Instituidos en Relacion con la Agricultura, a development bank that offers credit and guarantees, training, technical assistance and technology-transport support to Mexico's agriculture, livestock, fishing, forestry and agribusiness sectors, has helped Caja Providencia members gain access to subsidized loans to grow their business.

The grower uses the loans, which currently have a 1.5% interest rate, to invest in better equipment, machinery and other inputs that will lead to higher quality crops. That, in turn, will increase prices and enable sale to buyers from markets currently out of the farmers' reach.

Members who participate in the program must increase production, improve their livelihoods and offer better financial support to their communities. Currently, a cuadrilla, or team of 15 workers, spends entire days loading up to 1,300 boxes--totaling 23 tons--of bananas into semi-trailer trucks for transport to market. 

For more information about the value chain finance methodology, use the link.

IHuffPoI Wis. op-ed MBL bill to help small biz grow

 Permanent link
MADISON, Wis. and WASHINGTON (4/4/12)--An article in Wisconsin Corporate Report and a blog in Huffington Post feature credit union leagues telling why Congress should pass the member business lending (MBL) bill to increase credit unions' MBL cap.

Wisconsin Corporate Report recently carried an article Feb. 29 on how businesses in Reedsburg, Wis., had been hurt by banks that were either pulling their lines of credit or not renewing their loans, despite good payment histories (To read the article, use the link). 

That prompted Wisconsin Credit Union League President/CEO Brett Thompson to contact the publication. The result: an interview in the "The Last Word" column (March 28), the most frequently read page of the publication. The article emphasized that credit unions want to step in and help but many can't, because of the MBL cap that limits credit unions' MBLs to  12.25% of assets.  Credit unions, Thompson explained, are trying to get that changed in Congress to 27.5% of assets, but banks are opposing the bills.

Thompson was asked about the bankers' argument that business loans should be left to banks and that credit unions weren't good at this kind of lending.  "Nothing could be further from the truth. For many years, many (credit unions) have made loans effectively." He called banks' level-the-playing-field stance "disingenuous."  "If the playing field were that uneven, you would not be in a situation where 93% of all commercial lending in Wisconsin is done by banks."  He noted credit unions have done very well making MBLs.  The average MBL in the state is just under $178,000--the type of loans banks aren't interested in, he said.

"We have the ability to help borrowers, many of whom are the type that banks are not interested in, and at the same time give a shot in the arm to the economy," Thompson said. "It would mean $408 million in business credit in Wisconsin and we believe that would result in 4,447 new jobs" in the state.

In a Huffington Post (April 2) blog, Dave Adams, president/CEO of the Michigan Credit Union League & Affiliates, notes  banks aren't lending because of tough economic times and tough new regulations.  "While many banks are not making these loans, Michigan's credit unions have once again stepped up. In 2011, credit unions' small business loans were up over 14% for the fifth  year in a row during extraordinarily difficult economic circumstances when most banks were pulling back on business lending," he said.

To read all three articles, use the links. (See related story, "CUNA in Daily Caller: MBLs are all about small business," in News Now's Washington section.)

Special CUNA Board election to be held for Mays seat

 Permanent link
MADISON, Wis. And WASHINGTON (4/4/12)--The Credit Union National Association (CUNA) will conduct a special CUNA Board election for a seat representing District 5, Class C, CUNA announced Tuesday.

The seat was vacated when Harriet May, former CUNA Board chairman and former CEO of GECU, El Paso, Texas, announced her retirement, which was effective on Saturday.  The term for that position will expire at the adjournment of CUNA's Annual General Meeting in 2014.

A notice was sent Tuesday to eligible credit unions in District 5, Class C, who can nominate a candidate for the special election. District 5 is comprised of leagues in Arizona, Colorado, Kansas, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah and Wyoming.

Nominations are due April 27.  The election will be conducted by written ballot from April 30 to May 25. The term of office will begin immediately after the successful candidate is determined.

To be eligible, a candidate must be an employee or voting board member of the nominating credit union. The nomination must be in writing and be seconded in writing by two other credit unions of the same size group from the district.

Nomination packets were sent to eligible credit unions.  Nomination forms can be faxed to 608-231-4874, e-mailed to thanson@cuna.coop,or mailed to 5710 Mineral Point Road, Madison, WI 53705).

CU savings up loans down assets close to 1 trillion

 Permanent link
MADISON, Wis. (4/4/12)--Credit union assets nearly broke the $1 trillion threshold in February, and credit union membership remains strong, as it has since Bank Transfer Day, according to a Credit Union National Association economist's analysis of February's monthly sample of credit unions.

Click to view larger image Click for larger view
The movement's total assets reached $999.1 billion in February, a 1.9% increase from January and a 5.3% increase from February 2010.

Credit union membership increased 0.4% in February, an increase of 2.2% from Feb 2010.

"Credit unions are poised to pass the $1 trillion asset mark in March" said Bill Hampel, CUNA's chief economist. "That's one of the easiest predictions I've had to make. It's also gratifying to see strong membership growth continue into 2012.  Membership growth in just the first two months of 2012 is close to membership growth for the whole year 2010."     

Credit union savings balances grew 2.1% in February to $859.2 billion compared to a 0.4% decrease in January. Savings a year ago totaled $817 billion. Share drafts led savings growth with an 8.3% increase, followed by regular shares and money market accounts, which rose 3.4% and 1.2%, respectively. One-year certificates grew 0.1% while individual retirement accounts fell less than 0.1%.

Click to view larger image Click for larger view
Credit union loans outstanding decreased 0.2% during February to $584.8 billion, after a 0.1% decline in January. Loans totaled $574.2 billion in February 2011. Adjustable-rate mortgages led loan growth with a 0.7% increase, followed by fixed-rate mortgages, which grew 0.4%. Used-auto loans remained constant while home equity loans declined 0.6% and new-auto loans fell 0.7%. Unsecured personal loans and credit card loans dropped 1.9% and 2%, respectively.

The loan-to-savings ratio fell slightly to 68%. The liquidity ratio (the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities) grew to 21% in February.

Credit unions' 60+ day delinquency rate remained at 1.6%.

The movement's overall capital-to-asset ratio remained at 10%. The total dollar amount of capital is $102 billion.

SAC FCU launches Baby Bundle Savings Plan

 Permanent link
BELLEVUE, Neb. (4/4/12)--SAC FCU has introduced the "Baby Bundle Savings Plan" to encourage saving for the future by making it possible for parents, friends and family members to deposit funds in an infant's certificate of deposit throughout the certificate's term.

"Baby Bundle Savings Plan" accounts can be opened during the child's first year and then may remain open and grow throughout the child's lifetime, said the Bellevue, Neb.-based credit union.

When the account is opened, each participating infant receives a Baby Bundle "onesie," pacifier and piggy bank. When Baby Bundle accounts reach maturity, the $564 million asset credit union contributes $25 to every one-year term certificate and $50 to every two-year term certificate.

A credit union release stated the product is designed to help parents prepare for each child's future dreams and is part of a range of accounts designed to help people meet challenges at any life stage.

"Baby Bundle rewards parents who take advantage of the benefits of saving right from the start," SAC FCU President/CEO Gail DeBoer said.

Sioux Falls FCU offers adopt-a-classroom grants

 Permanent link
SIOUX FALLS, S.D. (4/4/12)--Sioux Falls (S.D.) FCU has created the Adopt-A-Classroom grant program to promote financial literacy in local classrooms for students in grades kindergarten-12.

The $163 million asset credit union plans to award up to six grants of up to $500 each for 2012-13 school year projects that include a student financial literacy component.

The grants will go directly to certified teachers in accredited public or private schools so they can obtain the resources required to implement creative financial literacy projects. A Sioux Falls FCU release noted that budget constraints make it more challenging each year to provide children with the tools for learning.

"It's important to give students in our communities the tools and guidance they need to become financially responsible adults," Sioux Falls FCU President/CEO Fran Sommerfeld said.

Application materials have been distributed to schools and are available on the credit union's website.

NCUA replies to tentative rulings in Goldman Sachs case

 Permanent link
LOS ANGELES (4/4/12)--The National Credit Union Administration (NCUA), in its lawsuit against Goldman Sachs & Co. over residential mortgage backed securities (RMBS) sold to Western Corporate FCU and U.S. Central FCU before their collapse, has filed supplemental memos and responses related to tolling time issues brought up in a tentative ruling by a federal judge in Los Angeles on March 15.

The March 15 tentative ruling is in addition to other tentative rulings made by U.S. District Judge George H. Wu in the U.S. District Court of the Central District of California, Western Division, in several cases involving NCUA seeking to recoup losses incurred by the corporates from investment banks.

The suit alleges that Goldman Sachs, GS Mortgage Securities, and Residential Accredit Loans violated securities law in connection with underwriting and issuing the RMBS sold to WesCorp FCU and U.S. Central. NCUA is suing as the liquidating agent for WesCorp and U.S. Central.

The latest flurry of filings relate to whether an "extender statute" and another court case, American Pipe Construction Co. v. Utah, apply to the statute of limitations and statute of repose arguments about whether NCUA had missed deadlines for filing the lawsuit.

NCUA had entered an agreement with Goldman Sachs to extend the time allowed for filing the lawsuit. NCUA says the limitations deadlines for filing the suit had not passed; Goldman Sachs says they had, despite the agreement between the parties.  Goldman also alleged NCUA didn't have standing to sue, since it was not one of the corporates that had bought the RMBs in question.  

In its response to tolling issues raised in an earlier filing, NCUA said Wu's March 15th tentative ruling "correctly concludes that this court should follow the strong majority of courts holding that American Pipe tolling applies whether or not the named plaintiff in a class action had standing to pursue direct claims for the injuries suffered by class members…," said NCUA's response.

In his March 15 tentative ruling, Wu said that "assuming the Court reaches the conclusion that the extender statute and American Pipe apply to the claims raised herein, the court would deny any attempt to dismiss [NCUA's] claims on statute of limitations grounds. " However, he added that "if any federal claims barred by the applicable statute of repose do not enjoy American Pipe tolling, those claims would be dismissed without leave to amend.  Assuming the court concludes American Pipe applies, the court would still order [NCUA] to amend its American Pipe-related allegations."  The court also said it would dismiss claims relying on origination activity of Homecomings Financial Network Inc., which failed to tie allegations to particular loans, but gave NCUA leave to amend its arguments there.

NCUA's reply memorandum said Goldman could have declined to enter the tolling agreement, in which case NCUA would have filed suit within the repose period. Noting that "Goldman's voluntary entry into the tolling agreement was permissible legal tolling that is fundamentally unlike equitable tolling," NCUA said Goldman "agreed to toll the statute of repose before its expiration--and thus induced NCUA to forbear from filing suit during the tolling period."

Regarding NCUA's claims under Kansas law, it "dooms Goldman's argument that the tolling agreement is somehow ineffective as to Kansas statutes of repose," said NCUA, adding that American Pipe tolling is "legal tolling that applies to statute of repose even though equitable tolling doctrines do not, so long as the tolling class action was filed before expiration of the statute of repose."

"The policies that preclude equitable tolling of the statute of repose in no way preclude enforcing a voluntary legal waiver of the repose period by sophisticated parties," argued NCUA. "Goldman identifies no benefit to a policy that permits large banks such as Goldman to renege on a voluntarily negotiated agreement to forestall litigation in hopes of reaching a settlement, and there is none," the agency said.

"There is no more sophisticated party in the U.S. than Goldman, which voluntarily entered into the tolling agreement, received the benefit of NCUA's consideration in delaying litigation pending settlement discussions, and then willfully flouted its promises when it sense some advantage to doing so," said NCUA.  "Goldman should not be permitted to profit from such unvarnished misconduct. The court should enforce Goldman's agreement," NCUA concluded.

In a previous ruling that partly dismissed NCUA's claims in a separate but related action against RBS Securities and other defendants, Wu had granted NCUA the leave to amend, or the ability to provide more information. His ruling had indicated that unless tolled by the virtue of American Pipe, all of NCUA's federal claims would be dismissed with prejudice because they are barred by a three-year federal statute of repose. An extender statute did not apply to the federal claims, he said.  The ruling did not affect NCUA's state securities law claims.

The court, in a separate development, has continued a non-appearance status conference that was originally to be held last week to April 12, according to court documents.

Wis. governor signs three credit union bills

 Permanent link
MADISON, Wis. (4/4/12)--Wisconsin Gov. Scott Walker has signed legislation that will allow credit unions to continue to expand support for their communities.

The bills signed into law include:

  • Charitable Contributions (SB 356): This law will allow credit unions to further support their communities by doubling the amount a credit union can contribute to charitable organizations annually. Credit unions can now make annual donations up to 1% of their regular reserves. Wisconsin credit unions support close to 3,000 charities and programs with hundreds of thousands of dollars of monetary, in-kind and volunteer support annually.
  • Public Deposits (SB 308): This law allows public entities to use a new service in placing their deposits at credit unions and other depository institutions.
  • Uniform Commercial Code (SB 416): This law updates technical language relating to secured account transactions. The new law harmonizes how secured transactions are processed so that Wisconsin credit unions are on par with financial institutions in other states.
"Wisconsin's member-owned financial institutions are vested in and committed to making significant contributions to the communities they serve," said Brett Thompson, Wisconsin Credit Union League president/CEO.

"These new laws help credit unions continue to provide top notch service to their 2.2 million members in communities across the state. We appreciate the strong bi-partisan support for these measures from the state Senate, Assembly and the Governor in ensuring they became law," he added.

SacTown run nets 140K for kids hospitals

 Permanent link
SACRAMENTO, Calif. (4/4/12)--The first Credit Union SacTown 10 Mile Run--which took place Sunday in downtown Sacramento, Calif.--raised more than $140,000 for Children's Miracle Network Hospitals in California and Nevada.

The first Credit Union SacTown 10 Mile Run raised more than $140,000 for Children's Miracle Network Hospitals in California and Nevada. The Sacramento, Calif., event was sponsored by Credit Union Miracle Day Inc. along with 64 credit unions and credit union businesses, including the California and Nevada Credit Union Leagues. Pictured are SacTown 10 Mile Run participants, including individual race winners: Tesfaye Alemayehu and Jane Kibii, with 11 year-old Parmina Valentine, a cancer patient at UC Davis, and members of the SacTown 10 Committee. (Photo provided by California and Nevada Credit Union League.)
The event was sponsored by Credit Union Miracle Day Inc., along with 64 credit unions and credit union businesses, including the California and Nevada Credit Union Leagues.

The "SacTown 10," also designed to increase national awareness of credit unions, took place the same day as the 40th Annual Credit Union Cherry Blossom Ten-Mile Run in Washington D.C., followed by Credit Union Freedom Runs for troops overseas.

Combined, the "Family of Races" raised a total of $515,000 for Children's Miracle Network Hospitals across the country.

Nearly 1,050 runners participated in the Sacramento race, which started and finished in front of the State Capitol building, with a $15,000 prize purse awarded.

Cara Cooper, a St. Francis High School junior who credits treatment she received at UC Davis Children's Hospital with helping her recover from the H1N1 virus (swine flu), sang the national anthem to start the event . Eleven-year-old Parmina Valentine, a cancer patient at UC Davis, cheered the runners on to the finish line and presented awards.

The Credit Union SacTown 10 kicked off with a craft day and news conference Friday  for credit union sponsors at UC Davis Children's Hospital in Sacramento. At the event, California and Nevada Credit Union Leagues President/CEO Diana Dykstra and SacTown 10 Committee Chairman John Pamer, CEO of Concord, Calif-based Diablo Valley FCU, presented Children's Miracle Network Hospitals with a check representing the $515,000 raised for children's hospitals.

Children's Miracle Network Hospitals is an alliance of premier children's hospitals across North America that treat 17 million critically ill children annually‚ regardless of their ability to pay.

Credit Union Miracle Day is the title sponsor group of the Credit Union Cherry Blossom Ten Mile Run. It is a partnership of credit unions, credit union service organizations, and partner organizations nationwide that joined under the umbrella of Credit Unions for Kids to support Children's Miracle Network Hospitals.

New fin lit survey 56 of U.S. adults dont budget

 Permanent link
WASHINGTON (4/4/12)--More than half of U.S. adults--56%--admit they do not have a budget, according to the 2012 Financial Literacy Survey, released Tuesday in recognition of April as Financial Literacy Month.

The survey was conducted by the National Foundation for Credit Counseling (NFCC) and the Network Branded Prepaid Card Association (NBPCA).  In its sixth year, the survey provides annual data and trending about Americans' attitudes and behaviors related to personal finance.

The survey revealed "a disturbing lack of basic financial skills that are critical to building a stable financial future," said the two organizations.

Among other findings:

  • One-third of U.S. adults, or more than 77 million Americans, do not pay all their bills on time;
  • Thirty-nine percent of adults carry over credit card debt from month to month;
  • Two in five adults save less now than they did one year ago, and 39% do not have non-retirement savings;
  • Twenty-five percent of those without non-retirement savings said that if they did begin to save, they would keep their savings at home--in cash.
"This year's survey unveiled some disturbing trends, showing that a significant number of Americans are saving less, spending more and carrying credit card debt over from month to month, suggesting that the painful financial lessons of the past are quickly being forgotten," said Susan C. Keating, NFCC president/CEO.

"Coupled with the two in five adults who gave themselves a C, D, or F on their knowledge of personal finance, the need for an increase in financial education becomes not only clear, but urgent," she added.

For the first time, the survey evaluated responses related to prepaid debit cards. Those findings include:

  • Thirteen percent--roughly 30.5 million Americans--typically use prepaid debit cards to pay for everyday transactions such as groceries, gas, dining out, paying bills and shopping online.
  • Seventy-eight percent of adults who use prepaid debit cards for everyday transactions say they use them because they are convenient;
  • Seventy-three percent use prepaid cards because they believe the cards are safer than carrying cash;
  • Seventy-two percent use prepaid cards to avoid overspending or spending money they don't have; and
  • Fifty-six percent said that the cards help them manage their money better.
"Consumers feel empowered using prepaid debit cards and revealed in the NFCC/NBPCA survey that the top three reasons for using the cards were their convenience, safety and ability to control spending," said Kirsten Trusko, NBPCA president/executive director.

"Additionally, about three in four prepaid debit card users indicated they believed prepaid cards are a better value for their money compared to a credit card or debit card connected to a traditional bank account," Trusko added.

The telephone survey was conducted by Harris Interactive between March 14 and March 19 among 1,007 adults age 18 or older. Of those, 89 use prepaid debit cards.

Visa drops Global Payments from compliant list

 Permanent link
ATLANTA (4/3/12)--Atlanta-based Global Payments  Inc. has been removed from Visa's "compliant service providers" list after revealing Friday that part of its third-party card processing system had been breached. However, Global says it has "contained" the breach to less than 1.5 million debit and credit cards.

"The company believes that the affected portion of its processing system is confined to North America and less than 1.5 million card numbers may have been exported," Global Payments said in  a press release Sunday.

The investigation so far has revealed that Track 2 data may have been stolen.  Track 1 and Track 2 data include names, card numbers and validation codes. Global said that cardholder names, addresses and Social Security numbers were not obtained by the criminals who hacked the system.

The breach has prompted a number of alerts from companies serving credit unions, as well as from credit unions themselves.  CUNA Mutual Group issued a risk alert Friday with tips for its bond policyholders. (Use the link).

The Members Group (TMG), a Des Moines, Iowa-based card processing and payment solutions for credit unions, is warning credit unions to be on high alert for credit card fraud stemming from the breach. It is assisting its card-issuing credit union clients with implementing defensive strategies to minimize the impact of card fraud resulting from the breach.

"The best prevention strategies will be different for every issuer and will depend greatly on where and how the fraudulent activity occurs," said Karen Postma, cards risk senior manager at TMG.  For some credit unions reissuing the card may be the best approach to minimizing losses. For others, tighter rule-setting and diligent monitoring will be sufficient, she said.

She explained that fraudsters typically test several different bank identification numbers (BINs) before settling on the one or two that are most profitable. The TMG fraud department is monitoring card activity closely to identify which BINs are most likely to be impacted.

Postma, who advised credit union card issuers through the 2008 Heartland Payments System data compromise, said it's too early to predict the fallout from this particular breach. "We plan to be in close communication with each of our card-issuing clients for the next several months as the investigation into the breach continues," she said.

"Credit unions should absolutely be proactive, however, monitoring their portfolios very closely to understand whether and to what extent they are being affected. If they determine they are being hit with high levels of fraudulent activity, more aggressive measures are likely necessary," Postma said.

Corinne Sherman, senior vice president, fee services for the Pennsylvania Credit Union Association advised credit unions to "pay close attention to information received from your card processor" (Life is a Highway April 2).

"This is very unfortunate and it could be very costly," said Sherman. "If a credit union has any concerns about cards at risk, it is best to err on the side of caution and reissue cards to protect members and its card program."

Credit unions are already reporting some fraudulent charges.  For example, during the last six days of March, Hermiston, Ore., police said they had received at least six reports of fraudulent charges made on credit cards issued by America's Best Community FCU, a $5 million asset credit union based in Hermiston (OPB News March 31).  Although the credit union's system wasn't compromised and members' accounts were safe, the nationwide implications of the Global Payments breach hit home for those members.  One couple charged $60 during the weekend on their card to see it turned into a $480 charge for purchases from a store in Kenosha, Wis. Another member reported $561 in fraudulent charges

Global Payments was working with industry third parties, regulators and law enforcement agencies to minimize potential cardholder impact, it said, adding it "has engaged multiple information security and forensics firms to investigate and address this issue."

"We are making rapid progress toward bringing this issue to a close. Our nearly 4,000 employees around the world are focused on providing exceptional service. We are open for business and continue to process transactions for all of the card brands," said Chairman/CEO Paul R. Garcia.

According to The Wall Street Journal (March 30), the cards were exposed between Jan. 21 and Feb. 25. The total cost of the breach is still being tallied. The company set up a website for consumers seeking information (use the link).

Athough Visa has removed the company from its list of providers, Global continues to process Visa and other branch cards and expects to be reinstated once the compliance issues with  card company standards are corrected.

Visa and MasterCard systems were not breached.  Also, Global made it clear Friday that the breach was not related to merchant/customer relationships.

Wachovia moves to consolidate NCUA suit with RBS case

 Permanent link
KANSAS CITY, Mo. (4/3/12)--Wachovia Capital Markets has filed a motion to consolidate a lawsuit filed against it by National Credit Union Administration (NCUA) over residential mortgage-backed securities (RMBS) sold to corporate credit unions with a similar suit filed by NCUA against RBS Securities.

The NCUA's original complaint against Wachovia alleged that originators of the RMBS had systematically abandoned the stated underwriting guidelines, resulting in riskier RMBS that the corporates would not have bought, had they known, said NCUA.  Wachovia representatives sold about $100 million in RMBS to the two corporates in 2006, and U.S. Central purchased approximately $80 million in RMBS underwritten by Wachovia, according to court documents.

NCUA presented similar complaints in its suit for $565 million in damages from RBS in the U.S. District Court for the District of Kansas, alleging that the firm violated federal and state securities laws when it sold securities to the now-defunct U.S. Central FCU. The agency claimed that RBS sellers and underwriters made numerous material misrepresentations in the offerings documents that caused U.S. Central to believe the risk of loss associated with the investment was minimal.

In the Wachovia case before the U.S. District Court for the District of Kansas, Wachovia asked in a motion filed Wednesday to consolidate the cases 'in light of the existence of common questions of law and fact" of the two cases.

Novartis FCU deposits 325K in Alloya CIF option

 Permanent link
WARRENVILLE, Ill., and EAST HANOVER, N.J. (4/3/12)--Novartis FCU, East Hanover, N.J., has deposited $325,000 in the new Community Investment Fund (CIF) option offered by Alloya Corporate FCU, Warrenville, Ill.

The CIF deposit made by the $125 million asset credit union will support national and state services that include financial education, professional development, community outreach and emergency assistance.

The CIF option was created through a partnership among Alloya, the National Credit Union Foundation and participating state foundations, including the New Jersey Credit Union Foundation.

Credit unions must be a capitalized member of Alloya to use the CIF option, which has a $1,000 minimum investment. Eligible credit unions can choose their investment amount, term and preferred earnings distribution ratio.

Consumers CU launches fraud awareness campaign

 Permanent link
KALAMAZOO, Mich. (4/3/12)--A fraud awareness campaign will use social media and other tactics to help members of $364 million asset Consumers CU recognize and avoid scams.

Consumers CU plans to use Facebook, Pinterest, Twitter, Foursquare and its blog to build member awareness, along with newsletter articles and lobby displays. 

The ongoing campaign will remind members to ask questions that can help them identify con artists, who typically contact people online or by telephone to make offers or ask for "help" in collecting funds. The campaign will reinforce the need for members to seek more information when offers appear "too good to be true."

"Con artists are shrewd and the scams constantly change," President and CEO Kit Snyder said. "While there is no one way to stop fraud it most often circles back to an unusual amount of money being offered for a seemingly easy or innocuous task."

Staff training is another component of the campaign to help tellers and other employees recognize transactions that indicate a member could be a potential fraud victim.  Senior Teller Cindy Powell recently averted two scams involving large sums of money in less than 30 days.

Top 10 March iNews Nowi stories Data breach No. 1

 Permanent link
MADISON, Wis. (4/3/12)--An article confirming a data breach of Visa and MasterCard card customer information at Atlanta-based Global Payments Inc., a third-party payment processor, was the most-read News Now article in March.

The top requested articles for March were:

10. Judge strikes several WesCorp officials' defenses

LOS ANGELES (3/20/12)--A federal judge has granted the National Credit Union Administration's (NCUA) motion to strike down certain defenses offered by officials of the now defunct Western Corporate FCU in NCUA's suit against them to recoup $6.8 million in investment portfolio losses from mortgage-backed securities.

9. Leon-Decker withdraws her name from NCUA consideration

WASHINGTON (3/13/12)--Carla Leon-Decker requested that her nomination to the National Credit Union Administration board be withdrawn and that request was honored by the White House Monday.

8. CUs on a roll as 'best of the best'

MADISON, Wis. (3/27/12)--Communities across the nation continue to recognize credit unions as the best of the best in a variety of areas.

7. Carla Leon-Decker's NCUA nomination has been withdrawn

WASHINGTON (UPDATED 3/12/12 5:48 p.m. ET)--The White House has announced the nomination of Carla Leon-Decker to be a member of the National Credit Union Administration (NCUA) has been withdrawn.

6.  CUNA, coalition seek rejection of merchants' interchange suit

WASHINGTON (UPDATED 3/15/12, 11:00 p.m. ET)--CUNA today joined a broad coalition of trade associations representing thousands of small and large financial institutions to file an amicus brief in a lawsuit brought by merchants against the Federal Reserve Board's rule that sets a debit interchange fee cap.

5. Use smarts to thwart fraud

DALLAS (3/20/12)--You can get ahead in life by being good at what you do. Unfortunately, the same is true for fraudsters (MoneyGram International March 7).

4. CUs remain on top in 2011 customer satisfaction survey

MADISON, Wis. (3/9/12)--Credit unions top the list of U.S. financial institutions when it comes to member/customer satisfaction, according to a new survey released Thursday.

3. Fed's stance on low rates has consequences for CUs--CUNA

WASHINGTON (3/14/12)--The Federal Reserve's stance on the continued low targeted range of the federal funds rate at 0% to 0.25% has consequences for credit unions, including a possible historic low net interest margin, according to a Credit Union National Association (CUNA) economist.

2. Compliance: Three questions CEOs should ask staff

WASHINGTON (3/9/12)--CUNA Comp Blog has released its latest compliance wrap-up, a monthly CompBlog feature that, in part, suggests important questions that credit union CEOs should be asking members of their staff.

1. CUNA confirms Visa, MasterCard notifying CUs, banks of breach

WASHINGTON (Updated: 6:50 p.m. ET 3/30/12)--CUNA has confirmed that Visa and MasterCard are notifying card-issuing credit unions and banks of a possible massive data breach involving Atlanta-based Global Payments Inc., a third-party payment processor.

OP-ED Banks target CUs for aid to small depositorsbiz

 Permanent link
HARTFORD, Conn. (4/2/12)--Banks are targeting credit unions for their willingness to reach out to consumers and small businesses, Norman Halls, chairman of STCU CU, Springfield, Mass., wrote in an opinion editorial recently published on Hartford (Conn.) Business.com.

"Bankers do not like competition," Halls wrote in his letter, and they are "trying to get back" at credit unions for assisting small depositors and small businesses during the weeks surrounding Bank Transfer Day, when banks were skewered in the media for high fees.

Halls also touted the Small Business Lending Enhancement Act of 2011, which would increase the member business lending cap for credit unions to 27.5% of assets from 12.25%.

Increasing the MBL cap, would inject $13 billion in new funds into the economy, creating as many as 140,000 new jobs in the first year after enactment, estimates the Credit Union National Assocation.

Halls cited a Wall Street Journal Sept. 18 article that said consumers may get "more bang for your buck" with a credit union. He also described the cooperative structure of credit unions.

"Stop banks from taking away your right to bank where you want," Hall concluded. "Contact your senator and congressman and tell him or her to vote for H.R. 1418 and S. 509. It's time that we tell them what direction we want."

CU System brief (04/02/2012)

 Permanent link
  • BISMARCK, N.D. (4/3/12)--The Credit Union Association of the Dakotas (CUAD) will announce the launch of its "We've Been Waiting for You" awareness campaign at two news conferences in Bismarck and Fargo, N.D., this week. CUAD President/CEO Robbie Thompson and Director of Strategic Initiatives Kristie Heit will announce CUAD's strategy, developed with Member Tree Consultants, a division of H2M of Fargo. The strategy includes targeted mass media tied with community visits throughout the Dakotas by CUAD staff and supplemented by social media efforts. The message: Credit unions offer similar services to banks, but with better service; consumers are likely eligible to join one or more credit unions; credit unions have money to lend; and there is a credit union closer than you think …