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CU System Briefs (05/16/2013)

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  • BELLEVUE, Neb. (5/16/13)--Employees and board members of the SAC FCU signed the final beam on their new corporate headquarters, being constructed in Papillion Neb. The new building will be four stories tall and 90,000 square feet, which will allow the largest credit union in the state to consolidate its corporate departments under one roof, with extra room to accommodate future growth. As the final beam was placed, SAC FCU held a Topping Off Ceremony to celebrate its success and commitment to the communities it serves. Staff expect to move into the building by March 2014. Pictured at the celebration are from left: Board members Jean Howard, Pat Jones, Marilyn Ogorzaly, and Jerry Needham, President/CEO Gail DeBoer, Senior Vice President Operations Robin Larsen, and board members John Goble and Dr. Julia Cronin-Gilmore. (Photo provided by SAC FCU) ...
  • RANCHO CUCAMONGA, Calif. (05/16/13)--
    The Richard Myles Johnson (RMJ) Foundation and Patelco CU gave 40 students at Roseville High School a "Bite of Reality" when they attended an interactive financial education simulation in the Sacramento area. The teens were given a fictional occupation, salary, family and spouse, student loan debt, credit card debt and medical insurance payments. They visited various stations to purchase transportation, food, clothing, housing, housing necessities and daycare. A credit union station provided guidance to participants in need of budgeting advice. Participants also were subjected to unexpected expenses throughout the simulation. "Giving teens this hands-on opportunity to experience making financial decisions in a low-risk setting gives them a better understanding of  the challenges of living on a budget before they have to make those decisions in the real world," said Tena Lozano, executive director of the RMJ Foundation. The foundation  is dedicated to supporting credit union efforts in spreading the financial literacy message to young people. (Photo provided by the California and Nevada Credit Union Leagues) ...
 

CUNA Fees Report; CUs Continue As The Better Deal

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MADISON, Wis. (5/16/13)--Credit unions continue to be the smarter choice, fee-wise, for consumers, according to the newly released Credit Union National Association 2013-2014 CUNA Fees Report.

The report confirmed the trend that credit unions, compared to banks, are still the better buy, said Jon Haller, CUNA's director of corporate and market research and co-author of the report.

"Compared to banks, credit unions have fared very well," he said. "On any fee we studied, credit unions are still less likely to charge a fee than banks, and if they do charge, that fee is still lower.  It's  great that they continued to do so," Haller said.

"For the majority of credit unions, fees play a pretty important role in maintaining financial stability," he said. "Fees represent 12% of gross income. Credit unions are trying to balance and maintain certain rates that ensure financial soundness while retaining current members and attracting new ones."

The report, part of CUNA's operational research, assists credit union leaders with difficult business decisions about what types of fees and amounts to charge. The data is by asset category and geographic region and covers a range of services.

As a percent of total income, noninterest income, which includes fees, grew from an average 20.1%  in 2009 to 28.6% in 2012. That income is critical to a healthy bottom line, the report notes. Without fees and other income, credit unions' return on assets would be substantially negative by 61 basis points, say CUNA's economists.

A comparison of credit union checking account fees with bank checking account fees showed no contest: 82% of credit unions offered free checking in 2012, similar to numbers in CUNA's previous fees reports.  Banks, however, are dropping free checking. In 2012, just 39% of banks offered free checking--a drop from 75% in 2010.

That bodes well for credit unions' future. The difference opens doors for credit unions to attract new members, Haller said.

Other fees and the percentage of fee income they generate included:

The report is available both in a PDF format and print version. For more information use the links or call CUNA's Customer Service at 800-356-9655 (press 3) or e-mail  ccsorders@cuna.com.

  • Nonsufficient funds and overdraft fees, 34%--the largest segment;
  • ATM and debit card fees, 12%;
  • First mortgages, 8%;
  • Other loans, which include application and late fees, as well as fees for member business, personal, agricultural, auto and student loans, 8%;
  • Credit card fees, 6%; and
  • Other, 17%.

New York CUs Award $225,000 In Scholarships

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ALBANY, N.Y. (5/16/13)--The Credit Union Association of New York Wednesday announced that 37 high school seniors have been awarded college scholarships as part of its statewide scholarship program. Nearly $225,000 will be awarded this year.

"These are all incredibly hardworking individuals and we are excited to have an opportunity to help fulfill their dreams of pursuing a college education," said William Mellin, CUANY president/CEO. "This truly represents the 'people helping people' philosophy of credit unions and how important it is to help our local communities succeed."

Twelve students will be awarded $1,000 scholarships, and 25 will receive $500 awards. In addition, individual credit unions across New York will award more than $200,000 in scholarships to students this year, according to CUANY estimates.

The students, who are all credit union members, were chosen based on academic performance, honors and awards, extracurricular activities, community activities, leadership roles and an essay. The award recipients must be high school seniors planning to enroll in either a two- or four-year college.

Overall, 94 credit unions participated. Nearly 1,400 applications were received.

Statewide winners were awarded a total of $24,500. For a list of the winners, use the link.

NCUF's Sebastian Announces Retirement

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WASHINGTON (5/16/12)--National Credit Union Foundation Executive Director Wendell "Bucky" Sebastian has announced he will retire, effective June 30.

He has been executive director at NCUF since May 2010. Previously Sebastian spent 20 years as CEO of Tampa, Fla.-based GTE FCU.

Sebastian also served as executive director and general counsel of the National Credit Union Administration  from 1981 to 1985 during Edgar F. Callahan's tenure as chairman. Upon leaving NCUA,  Sebastian co-founded Callahan & Associates, a credit union consulting firm.

He also served as a former general counsel of the Illinois Department of Financial Institutions.

"Bucky has done an outstanding job over the last three years in directing the foundation to focus its efforts on financial education and a number of key initiatives to benefit the credit union movement," said Credit Union National Association President/CEO Bill Cheney. "We will miss him and want to thank him for his many contributions to the foundation as well as the CUNA/league system."

NCUF Board Chair and Tampa, Fla.-based Floridacentral CU President/CEO Laida Garcia, announced she will appoint a search committee to recruit for a successor.  "While we congratulate Bucky on his upcoming retirement, we also acknowledge the loss of an excellent leader, who will be greatly missed," Garcia said.

Kansas CUs Pick Up Tab At Seven Businesses

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WICHITA, Kan. (5/16/13)--Eleven Kansas credit unions surprised consumers with gift cards, cash, free coffee or a free lunch Tuesday in seven communities across Kansas.

Click to view larger image Jennifer Kirmse, vice president of business development at Educational CU in Topeka, Kan., takes part in surprising consumers with gift cards, cash, free coffee or a free lunch Tuesday at PT's Coffee in Topeka. The event, which took place in seven Kansas communities, is part of the Kansas Credit Union Association's Make a Difference campaign. (Photo provided by the Kansas Credit Union Association)
It's part of the Kansas Credit Union Association's Make a Difference campaign. KCUA said it received great responses to the spontaneous event via Twitter and Facebook and in person.

"This is the perfect way for credit unions to illustrate the philosophy of 'people helping people,'" said Susan Dyer, KCUA communications director. "It's why credit unions exist ... to serve their members. And it's a way for credit unions to show they are dedicated to serving their communities."

"It's the simple gestures that mean the most," Dyer added. "We wanted to brighten the day of Kansas residents, and we hope they will pass it on and do something nice for someone else."

Each location had $1,000 to use in the form of cash or gift cards. Depending on the location, people were surprised with a gift card, cash or a free purchase of coffee or lunch

Representatives from 11 credit unions throughout the state volunteered for the event.

The communities, credit unions and locations involved in the free lunches were:

  • Emporia--Emporia State FCU (Granada Coffee Co., Java Cat Coffeehouse, Amanda's Bakery, Commercial Street Diner);
  • Ness City--United CU (Cuppa Joe's);
  • Norton--United Northwest FCU  (White Fields Coffee House);
  • Kansas City, Kan.--Mainstreet CU and  Reliance CU (Krispy Kreme Doughnuts, Merriam);
  • Topeka--Educational CU (PT's Coffee);
  • Topeka--Quest CU and New Century CU (Classic Bean, downtown); and
  • Wichita--EquiShare CU, Mid American CU and Wichita FCU (Mead's Corner).
This was the second in a series of events. The first event was a gas giveaway in October. The third event will be in October, during International Credit Union Week.

Purvis Elected To CO-OP Board

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RANCHO CUCAMONGA, Calif. (5/16/13)--Chuck Purvis, president/CEO of Coastal FCU, Raleigh, N.C., has been elected to a three-year term on the CO-OP Financial Services Board of Directors, joining four other re-elected directors in the 11-member body.

Purvis joined Costal FCU in May 2001 and became president/CEO in July 2012. Coastal FCU is a $2.1 billion credit union that serves more than 190,000 members. Purvis also is a former chairman of the National Credit Union Foundation. 

Terry Laudick, president/CEO of New Mexico Educators FCU, Albuquerque, N.M., was re-elected to a second one-year term as chairman. The four re-elected directors are:

  • Vice chairman/chairman-elect--Doug Ferraro, president/CEO, Bellco CU, Lakewood, Colo.;
  • Secretary--Allan McMorris, president/CEO, Oakland County CU, Waterford, Mich.;
  • Treasurer--Jeff Napper, president/CEO, LBS Financial CU, Long Beach, Calif.; and
  • John Radebaugh, president/CEO, North Carolina Credit Union League.

SECU's First-Time Homebuyer Program Exceeds $1B

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RALEIGH, N.C. (5/16/13)--State Employees' CU's (SECU) First-Time Homebuyer's (FTHB) Mortgage Loan program has reached $1 billion in loan balances.

Since its inception 24 years ago, the program has helped more than 8,300 credit union members achieve homeownership, the Raleigh, N.C.-based credit union said.

"Our goal as a financial cooperative is to offer safe and affordable loan options to best serve the overall needs of our membership," said Spencer Scarboro, SECU senior vice president of loan originations. "SECU's achievement of serving 8,300 members with $1 billion in loan balances while incurring minimal losses is true evidence of the program's viability and success." 

Unlike conventional mortgage loan requirements, SECU's program helps qualified members to borrow up to 100% of the purchase price for a primary residence. 

The average loan amount under the FTHB program is about $180,000. The program is available with SECU's two-year and five-year adjustable-rate mortgage products for a term of up to 30 years. Competitive interest rates and low settlement costs, along with no origination or credit report fees and no private mortgage insurance requirement provide significant savings for first time borrowers, said SECU.

SECU's program has incurred minimal losses, Scarboro said. Even after the great recession, with unemployment around 9% in North Carolina, net charge-offs in the FTHB program over the past 12 months averaged just 0.29%, with 60-day delinquencies below 2%.

cuStudentLoans, joinStampede Form Student Loan Refinancing Program

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NEW YORK (5/16/13)--A new private student loan refinancing program has been developed for the consumer driven-movement joinStampede by cuStudentLoans, a private student loan and private student loan consolidation program managed by credit unions.

The program, featuring a private student loan consolidation without origination fees, was created in response to 30,000 consumers who pledged interest in refinancing their private student loans through a group discounting initiative.

The initiative will collect registrations from consumers with student debt until May 31 on the www.joinStampede.com website and will begin accepting applications officially on June 1. Consumers can apply through June. 15.

The average interest rate of private student loans that have been refinanced through cuStudentLoans is 5.66%, compared with the average 8.46% that consumers held before refinancing, said the cuStudentLoans.

The Credit Union National Association recently released a high school borrowing survey indicated that more than half of high schools seniors do not know what their college educations will cost them. Their lack of knowledge, coupled with higher tuition debts, are factors in the shift toward student loans as the largest source of consumer debt in the U.S.  Student loan totaled more than $1 trillion in 2012.

"The success of joinStampede's campaign is further evidence that consumers are seeking better rates and terms on their student loans," said Alice Stevens, cuStudentLoans chairman.

joinStampede promotes organizing consumers around technology and like-minded issues to create a tool for affecting change in markets. It has partnered with Causes.com, a world-wide platform for social change.

IC3: Online Fraud Losses Increased In 2012

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WASHINGTON (5/16/13)--Online fraud losses increased last year, according to the Federal Bureau of Investigation's Internet Crime Complaint Center (IC3), which Tuesday released the 2012 Internet Crime Report--a summary of reported fraudulent activity, with data and statistics.

In 2012, the IC3 received and processed 289,874 complaints, averaging more than 24,000 complaints per month. Unverified losses reported to IC3 rose 8.3% over the previous year. However, total complaints decreased from 2011.

"The 2012 Internet Crime Report reveals both the volume and the scope of Internet crime, as well as the efforts of IC3 and law enforcement to combat these crimes," said National White Collar Crime Center Director Don Brackman. "As technology continues to advance, so will our efforts to stay one step ahead of cyber criminals."

The most common complaints received in 2012 included FBI impersonation e-mail scams, various intimidation crimes, and scams that used computer "scareware" to extort money from Internet users.

"Criminals are increasingly migrating their fraudulent activities from the physical world to the Internet," said Richard A. McFeely, executive assistant director of the FBI's Criminal, Cyber, Response and Services Branch. "Computer users who suspect or become victims of online fraud schemes--including suspicious e-mails, fraudulent websites and Internet crimes--should report them to the IC3. The IC3 analyzes and makes connections among these reports and packages them for potential action by law enforcement."

Other highlights from the report were:

  • Adjusted dollar losses from online fraud totaled $525.44 billion, with 114,908 complaints reporting a loss. The median dollar loss for those reporting a loss was $600; the average dollar loss overall was $1,813; and the average dollar loss for those reporting  a loss was $4,573.
  • A trend in recent years indicates the number of complaints by gender is equalizing. In 2012, there were 149,601 male complaints (51.61%),  and 140,273 female complaints (48.39%).
  • Age groups that filed complaints were little changed last year, with under age 20 representing 3.24% of the complaints; 20-39 (39%); 40-59 (43%); and 60 and older (14%).
  • The top 10 states for victim complaints were: California (13.41%); Florida (7.98%); Texas (7.22%); New York (5.7%); New Jersey (3.81%); Pennsylvania (3.7%); Illinois (3.5%); Virginia (3.3%); Ohio (3.05%); and Washington (2.72%).
  • The top five countries by victim complaints were: the U.S., Canada, United Kingdom, Australia and India.
  • The most common scams and total complaint numbers were: FBI impersonation e-mail scams--14,141 complaints; scareware/ransomware scams--1,969; and hit man/extortion scams (1,354).
IC3 is a partnership among the FBI, the National White Collar Crime Center and the Bureau of Justice Assistance.