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CUs topic of Welsh Assembly Co-op group debate

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CARDIFF, Wales (6/1/12)--Credit unions in Wales met with the Welsh Assembly Cross-Party Group on Cooperatives and Mutuals last week to discuss the future of credit unions and the challenges for financial cooperatives in Wales.

The meeting brought together Welsh Assembly members; Welsh financial bodies including about half of Wales' credit unions and the Association of British CUs (ABCUL);  and other concerned groups  (ENP Newswire May 30).

ABCUL President Sharon Angus-Crawshaw outlined the wider challenges and opportunities the sector faces.  After the event she noted that participants can benefit from learning about each other's experiences and working together, especially in the International Year of Cooperatives. Also, Barry Roberts, general manager of North Wales CU presented his credit union's work.

After the meeting, Vaughan Gething, chair of the assembly's Cross Party Group, noted that credit unions offer access to finance for some of Wales' most disadvantaged communities. "I am proud that our Welsh government has supported the sector, but we must do more. We must work in primary schools, to ensure that financial literacy is engrained early, and we must also look at innovative ways forward, such as with post offices," Gething said. He was referring to a proposal to have post offices as an access point to credit union services.

Wales' credit unions have experienced substantial growth from 2004 to 2011, including: a 70% increase in member growth; a 90% increase in savings; and a 107% increase in assets.

West. CUNA Management School announces Melchione fund

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RANCHO CUCAMONGA, Calif. (6/1/12)--Western CUNA Management School has created a perpetual Joseph Melchione Memorial Fund to honor the long-time faculty member and California credit union attorney, who died April 17 of lung cancer.

The fund will provide scholarships to allow future credit union leaders to attend WCMS and be used to enhance the quality of the program.

Melchione was a key WCMS faculty member for more than 25 years, teaching business law, corporate law and ethics for the credit union management development program. He also was a huge supporter of WCMS student fundraising efforts, frequently motivating students to take fundraising seriously, including allowing them to auction his clothes or cut his trademark ponytail for the cause.

"Joe's contributions to WCMS went far beyond simply sharing his knowledge with our students. He was an ardent evangelist and defender of the ideals and enduring importance of the credit union movement," said WCMS President/CEO James D. Likens.

Melchione's law firm Styskal, Wiese & Melchione (SWM) LLP has pledged an annual $10,000 gift to the fund. Tax-deductible contributions to the fund may be sent to:

Melchione Memorial Fund

Western CUNA Management School

P.O. Box 51476

Ontario, CA 91761-0076

WMS was the first law firm in the nation to specialize in serving the needs of the credit union industry. Today it serves more than 350 credit unions nationwide. Melchione spend more than 37 years working on behalf of the industry and was instrumental in the development of wide-ranging credit union legislation and regulations.

CU System briefs (05/31/2012)

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  • HARTFORD, Conn. (6/1/12)--Michael Johnson, 32, of Miami Gardens, Fla., was sentenced to 22 years in prison Wednesday as the alleged ringleader of a 'felony lane' gang of thieves who used a drive-through lane that was farthest from the teller window to cash roughly $6 million in fraudulent checks at credit unions and banks in 10 states. The spree ran from 2007 to 2010 and spread from Connecticut to Florida to the U.S. Southwest (The Hartfort Courant May 31). Johnson's lawyers said he was responsible for about $329,000 of the stolen funds. The gang was allegedly also responsible for $27,000 in insurance costs and damages to hundreds of automobiles from which the gang stole identification documents and account information used for cashing the phony checks. Gang members would break into autos at gyms, health clubs and parking areas at the heads of hiking trails. Investigators have identified 158 persons who were victimized in the scheme. After stealing ID documents, the gang would recruit drug addicts--some in disguises to resemble the IDs--to drive rental cars through drive-throughs and use the documents to cash the checks. Two weeks earlier, a second defendant, Jermaine Jones, 32, of West Palm Beach, Fla., was sentenced to 20 years in prison for the crimes. A third defendant, Sheikera Williams, has pleaded guilty to fraud, theft and conspiracy charges and is awaiting sentencing …
  • SAN ANTONIO (6/1/12)--SACU (San Antonio FCU) hosted U.S. Rep. Francisco "Quico" Canseco (R-Texas) in a town hall meeting for employees to learn more about national issues affecting credit unions and the community. Canseco has been a supporter of credit union initiatives, most recently co-sponsoring H.R. 3461, the Financial Institution Examination Fairness Bill" and H.R. 4367, a bill to amend the Electronic Fund Transfer Act to limit fee disclosure requirements. "Being able to listen to and ask questions of someone directly involved in making laws is a unique opportunity," said Yvonne De La Rosa, government relations officer at SACU. Pictured are SACU representatives with the congressman, from left: De La Rosa, Steve Hennigan, Canseco, Gloria Canseco and Les Sachanowicz. (Photo provided by SACU) …
  • SALT LAKE CITY (6/1/12)--Deseret First CU, based in Salt Lake City, has promoted Chief Financial Officer Shane London to president/CEO, effective July 1. He replaces Clint Gurney, who is retiring after two years as interim president/CEO of the $420 million asset credit union.  London began his career with Desert First in 1981 as a part-time teller and accounting clerk while attending the University of Utah. He is a graduate of CUNA Management School, CUNA Financial Management School and Regulatory Compliance School. At Deseret First, he has held the positions of accountant, controller, and vice president. Since 2008, he was served as executive vice president and chief financial officer …
  • FARMERS BRANCH, Texas (6/1/12)--Jim Seale, senior vice president of operations at 1st Community FCU, San Angelo, Texas, died May 25 of an apparent heart attack at his home. He was 65. Seale had been with 1st Community for more than 18 years, said the Texas Credit Union League (LoneStar Leaguer May 31). He previously was employed with General Telco FCU (now Qualitrust CU) from 1975 to 1991 as vice president of operations. He was a 2004 graduate of the Southwest CUNA Management School and was a devoted credit union ambassador, said the league. Services were held Wednesday …

Brand-based marketing topic of CUNA Council paper

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MADISON, Wis. (6/1/12)--The merits of transitioning to and maintaining a brand-based focus as opposed to a product-based focus to marketing are explored in the most recent CUNA Marketing & Business Development Council white paper.

"Transitioning from Product-Based Marketing to Brand-Based Marketing" explains how most credit union marketing professionals have a routine: Next month promote auto loans, the month after that concentrate on certificates, the next quarter dust off the new membership recruitment drive, and then go back to auto loans towards the end of the year.

For many years, credit unions have operated under such a product-based marketing and communications plan, with varying degrees of success. The times, however, are changing and what once worked in this regard won't suffice in a new millennium, said the council.

The white paper makes the case for the transition. It also:

  • Discusses the limitations of product-based marketing;
  • Describes the benefits of brand-based marketing;
  • Examines why it is better to fit a credit union brand to a product;
  • Explores how brand-based marketing can help credit union professionals save time, money, and improve overall brand visibility;
  • Looks into possible challenges involved in moving to a brand-based marketing plan; and
  • Provides suggestions and insights into why conducting a marketing audit may be a good idea for the credit union.
The paper includes insights from several industry professionals who support a brand-based approach to marketing.

For more information, use the link.

Weiler to join N.Y. CU Hall of Fame

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ALBANY, N.Y. (6/1/12)--Louis G. Weiler, a founding member of New York City's Municipal CU, will be inducted posthumously into the Credit Union Association of New York's (CUANY) Credit Union Hall of Fame.

His induction will take place June 9 at the association's Annual Meeting & Convention. Weiler is being inducted for his role as a pioneer in the credit union movement. Weiler helped form Municipal CU in 1916. He and his fellow founding directors were concerned for the thrift, credit and financial needs of city workers who were being preyed upon by loan sharks, said CUANY.

Beginning in 1927, he served as the first president of CUANY, known then as the New York State Association of Credit Unions. He also helped form the Credit Union National Association.

"Louis Weiler made credit unions his life work," said William J. Mellin, CUANY president/CEO. "Although he passed away in 1944, his legacy and influence continue at Municipal CU and in the entire credit union movement."

Today Municipal CU has $1.8 billion in assets and 342,000 members.

Bill sent to Ohio Senate without public funds amendment

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COLUMBUS, Ohio (6/1/12)--A state legislative amendment that would allow Ohio credit unions to accept public funds was tabled before the bill was sent to the Senate, said the Ohio Credit Union League. However, a stand-alone public funds bill is still in the state House and Senate.

On May 16, the day after the Ohio House Ways and Means Committee tabled the amendment by State Rep. Tom Letson (D-Warren) to the Financial Institution Tax (FIT) bill, which would have included credit unions as eligible depositories for public funds but exempt from FIT, the House voted 74-12 to send the FIT bill to the Senate (eLumination Newsletter May 30).

"While tax reform continues to be a 'high priority' for the banking industry, it is unfortunate that restrictive mandates continue to prevent choice for local public entities and expanded opportunities for economic growth, small businesses, and efficiencies in our state," said league General Counsel John Kozlowski.

However, stand-alone public funds legislation (HB 510) currently is in the Senate Ways and Means Committee awaiting additional hearings. The General Assembly is scheduled to recess June 13 and return after the November elections. During that break, the league and credit union leaders will continue meeting with local public officials and members of the General Assembly about public funds.

The measure would give Ohio's schools, local governments, communities, libraries, police and fire districts, and others greater choice by removing a state mandate preventing them from using community-based credit unions as public depositories (News Now May 18).

The legislation was the focus of meetings throughout the year between Ohio credit unions and league leaders and members of the House and Senate financial institutions committees, including during April's InVest48, the league's convention and expo.

Filene CUs can engage members with game thinking

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MADISON, Wis. (6/1/12)--As credit unions aim to improve member financial behavior, skills, and capacity; engage audiences; and optimize organizational performance, some experts are asking: Should credit unions be thinking more like game designers? According to a new Filene Research Institute report, the answer is yes.

The report, "Get in the Game:  How Credit Unions Can Engage Members, Solve Problems, and Improve Skills with Game Thinking," shows how game designers approach solving problems and engaging audiences, explores the psychology of game players and uses examples that credit unions can implement immediately, Filene said.  

During the past decade, the institute has studied, piloted and researched several ideas that leverage game thinking. Its work with the prize-linked savings program Save to Win uses the appeal of lottery-type games to encourage low-wealth consumers to develop positive savings habits. The i3 Idea Savings Challenge took advantage of game dynamics to encourage families to reduce debt and increase savings. A 2012 pilot with Save to Win is studying how game thinking can encourage better financial behaviors.

Worldwide, three billion hours are spent playing video games each week. The five million "extreme" gamers in the U.S. play an average of 45 hours per week, more than the average worker spends earning a living. In contrast, consumers spend only 2.6 hours per month on financial planning and budgeting, said Filene's executive summary.

Why? Because games are fun, while personal finances are boring or overwhelming, says the report's author, Matt Davis. Games help people escape reality; personal finances force confrontation with it.

The report's key findings for credit unions are:

  • Keep score and design effective leaderboards. Game players expect feedback for nearly every action they take. They want to know how they have done, how they stack up against peers, and how much they have improved over time. Credit unions must shorten the feedback loop associated with positive--and negative--member financial behaviors, employee performance and board participation.
  • Ideal self versus real self. Game players are more likely to enjoy and become motivated to play a game when it allows them to experience ideal self-characteristics. That force is stronger for players with a large difference between their ideal and perceived actual selves. Online banking experiences, loan applications and balance inquiries serve as blunt reminders of reality. Gamified financial services may motivate consumers by allowing them to experience, and learn from, their ideal selves.
  • Outcome certainty is boring. Save to Win proves the power of uncertain outcomes. A chance to achieve something new, win a valuable prize, or gain a new experience adds excitement to ordinary tasks. If disengaged members, misaligned incentives, boring experiences, and unmotivated audiences are the bane of traditional financial services, gamification may help credit unions.
For more information, use the link.

Acadia describes award-winning fin lit program

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FORT KENT, Maine (6/1/12)--Acadia FCU (AFCU), Fort Kent, Maine, partnered with the University of Maine at Fort Kent (UMFK) last year to create a program dedicated to educating youth about the importance of financial planning. For its efforts, Acadia FCU earned the Desjardins Youth Financial Literacy Award at the 2012 Maine Credit Union League Annual Convention.
David Desjardins, left, president/CEO of Acadia FCU, is presented with the Desjardins Youth Financial Literacy Award by Richard Dupuis, chairman of the Maine Credit Union League Board. Acadia FCU was recognized for a financial planning program for children it created in partnership with the University of Maine at Fort Kent.


The AFCU-UMFK partnership is supported by a Financial Education Grant from the National Credit Union Foundation (NCUF) that helps subsidize the implementation of activities, presentations and resource development for youth financial education. The AFCU-UMFK Financial Literacy Partnership seeks to educate youth at key points during a child's development.

After several months of research, planning and training, credit union and university representatives kicked off the program in second grade classrooms with the Benny Banks program.

They introduced students to a curriculum of stories, pictures and interactive lessons that teach about saving money and planning for long- and short-term spending goals.

Click to view larger image Sixth-graders learn how to write a check as part of the Paradise Paycheck activity at the Dollars & $ense Fair held in April at the University of Maine at Fort Kent. (Photos provided by National Credit Foundation)
Sixth-grade students were targeted through a Dollars & $ense Fair. They participated in activities that taught them about financial goal setting, college planning and earning, saving and spending.

With hands-on tasks, students could gain a better understanding of the importance of planning for their financial futures.

At the convention, both David Desjardins, president/CEO of Acadia FCU, and Scott Voisine, dean of Community Education at UMFK, said they hope the project encourages other organizations to collaborate and prioritize youth financial literacy education.

NCUF grants are made possible by supporters of the foundation and the Community Investment Fund (CIF), a system of investments that help credit unions earn dividends while donating to national and state community development programs.

Ohio bill may increase revolving credit charges

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COLUMBUS, Ohio (6/1/12)--The Ohio House of Representatives passed a banking parity bill last week that would allow Ohio's state-chartered financial institutions, including credit unions, to compete with other financial institutions from out-of-state.

The bill would allow the state-chartered institutions to charge the same or lower rates, interest fees, and other charges under a revolving credit agreement as out-of-state financial institutions charge Ohio customers.

According to the Ohio Credit Union League, House Bill 322 defines a "revolving credit agreement" as repeated transactions and the amount of credit may be extended until the outstanding balance is repaid. The bill excludes agreements secured by a residential mortgage, the league added (eLumination Newsletter May 30).

Credit unions currently are limited to charging up to 25% annual percentage rate on their loans, including loans under a revolving credit agreement such as a credit card.

The legislation would mean Ohio-chartered credit unions could charge the same or lower rate than one from out-of-state. Many out-of-state financial institutions charge higher rates to revolving credit customers in Ohio than do their counterparts in the state.

"By enacting this legislation, Ohio financial institutions will no longer be limited to revolving credit agreement limitations on interest rates from lenders in other states doing business in Ohio," said the league.

The bill would allow Ohio's institutions to adjust their rates to compete with the rates authorized by out-of-state institutions that serve Ohio consumers. Financial institutions had told a state committee that the rate cap had contributed to some Ohio banks' decisions to move their credit card operations to other states, which cost the state jobs and revenue (lakecurrents.com May 22). The bill awaits signature by Gov. John R. Kasich.

One year later Mo. CUs rebuild from tornado

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ST. LOUIS (6/1/12)--One year after an EF-5 tornado leveled her home to its foundation, Joplin (Mo.) Metro CU President Cindy Atteberry joined a
Joplin (Mo.) Metro CU President Cindy Atteberry points to the corner of her former home, where she and her husband huddled together while an EF-5 tornado demolished their house on May 22, 2011. (Photo provided by the Missouri Credit Union Association)
procession of 6,000 people for a commemorative Walk of Unity. For the past year, Joplin Metro--along with BluCurrent CU, District 7 Highway CU, and Great Plains FCU--have focused their efforts on rebuilding their credit unions and the community after the deadly tornado struck the area on May 22, 2011.

"I am so proud of my staff and my town for the rebuilding efforts we have accomplished this past year," said Atteberry. "We have set an example for other communities in distress that things are possible, you can rebuild and you can come back."

Credit unions in Missouri and beyond are credited with helping jump-start financial support for Joplin residents. The Missouri Credit Union Charitable Foundation (MCUCF), in partnership with the National Credit Union Foundation, initiated a CUAid call for support and collected $115,594 from credit unions and business partners to aid tornado victims.

The Missouri Credit Union Association (MCUA) presented a $10,000 donation to kick off the fundraising efforts. MCUCF distributed grants in amounts up to $500 to 322 adults, 106 children, eight credit union employees and one volunteer.

"Some of our members used the grant money to cover costly repairs to their homes and vehicles," said Justin Coyne, District 7 Highway president. "We were lucky that only a small portion of our members were impacted by the tornado, but we were there for all of them."

The Credit Union National Association (CUNA) honored Joplin Metro with a Dora Maxwell Social Responsibility Community Service Award for its efforts after the tornado. In addition to social outreach, local credit unions faced unique business challenges after the disaster--such as aiding employees who lost their homes, stopping payments on hundreds of lost checkbooks and confronting a portfolio of car loans for vehicles that were destroyed or missing.

The month after the tornado, Joplin Metro experienced a huge inflow of deposits from trusting members who received insurance claims and disaster recovery assistance. That unprecedented inflow caused the capital ratio to drop even though the credit union's actual capital hadn't changed at all, said MCUA.

"When the tornado hit, we were right in the middle of implementing an enhanced internet banking platform, automatic bill pay, mobile access and e-statements," said Kelley Melton, controller of Great Plains FCU.  "Rolling out these services amid disaster recovery efforts was challenging. But we did more than just recover, we've gotten better and now offer more to our members."

All four credit unions have recovered physically from the damage and now operate at full capacity. The two largest credit unions headquartered in Joplin--the $27.5 million asset Joplin Metro and the $229.7 million asset Great Plains FCU--have grown in deposits by 20.95% and 4.6%, respectively.

After the disaster and as insured members received their claim checks, the assets of these two credit unions grew rapidly. A year later, assets are beginning to recede due to rebuilding and the redeployment of those deposits by the members. Operationally, the two credit unions continue to perform well, with returns on assets of 0.51% and 0.48% respectively through March.

"Our membership is doing well with most members having either rebuilt or in the process of rebuilding, and the good news is they're putting in storm shelters," said Steve Pierson, BluCurrent president. "We know because of all the storm shelter loans we are doing for 2.99%, which has brought in some new members."

In addition to tornados, credit unions can prepare for other natural disasters. See related story,"NCUA, CUNA advise CUs as hurricane season begins," in today's Washington section of News Now.)

Corporates pedometer challenge fundraiser unique

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IRONDALE, Ala. (6/1/12)--A pedometer challenge by  Alabama-based Corporate America CU and its member credit unions during the corporate's annual meeting was a unique way to raise funds for Children's Miracle Network Hospitals, said Joe Dearborn, senior director of Credit Unions for Kids (CU4Kids).

The challenged raised $2,500 for CU4 Kids/ Children's Miracle Network Hospitals when the corporate asked annual meeting attendees to "step it up."

During a three-day period, attendees walked the conference floors and along the shores of Destin, Fla., where the annual meeting took place. Don Carden, CEO of Coosa Pines FCU, Childersburg, Ala., logged the most steps and won a three-day stay at the Hilton Sandestin Resort.

"We wanted to encourage participation in a healthy activity and raise money for a wonderful program," said Joy Breedlove, education consultant with Corporate America.

Dearborn said he believes the pedometer challenge "is a unique fundraising idea that might be of interest to others in the credit union community."

CU4Kids, a nonprofit collaboration of credit unions, chapters, leagues/associations and business partners nationwide, raises funds for 170 Children's Miracle Network Hospitals. Credit unions are the third largest sponsor of the hospitals. Of every dollar donated, 100% goes to support research and training, purchase equipment or pay for uncompensated care for children.

NCUA sues alleged fraudulent-loan recipients of liquidated CU

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CLEVELAND, Ohio (5/31/12)--The National Credit Union Administration (NCUA) has filed another lawsuit attempting to recoup losses related to the failure of St. Paul Croatian FCU, which collapsed in the wake of more than 1,000 fraudulent loans that resulted in criminal charges for at least 19 people, including the former CEO.

NCUA filed a complaint May 21 in the U.S. District Court for the Northern District of Ohio, Eastern Division against Cleveland financier A. Eddy Zai and Tina Zai of Pepper Pike, Ohio; Ted M. Vannelli of Kirtland, Ohio, a former Trumbull County commissioner; and The Cleveland Group Ltd. plus nine related entities that allegedly received the bulk of the fraudulent loans.

A. Eddy Zai was indicted in Feb.7  on 34 counts related to obtaining $16.7 million in fraudulent loans from June 2009 until the credit union's liquidation on April 30, 2010,  from the defunct Eastlake, Ohio-based credit union (News Now Feb. 9). Vannelli, who is Zai's father in law, has pleaded guilty to participating in the loan scheme, which allegedly caused the credit union to collapse.

NCUA seeks $18.9 million from all the defendants, plus interest. It also seeks $37.9 million in judgments related to promissory notes on loans made to Zai, Vannelli and the various corporations. The complaint charged that the defendants applied for and received the loans but failed to keep enough funds in their accounts as collateral for the loans. Instead, the companies made loan payments with money obtained from new loans and benefitted from "unjust enrichment," said the document.

The court documents alleged the companies comingled funds and loan proceeds with accounts at financial institutions, including St. Paul Croatian FCU.

NCUA also seeks to void a transaction between two defendant companies--International Regional Center (IRC) and the Cleveland Group LTD--saying it was a fraudulent transfer and the amount transferred to IRC should be returned to NCUA as the credit union's liquidating agent.

The court document alleges that Adam Blackman, a longtime employee and chief financial officer of The Cleveland Group, knew of the defendants' debts owed to the liquidating agent. It said Blackman filed IRC's articles of organization on Feb. 1, and that on Feb. 12--five days after Zai was indicted--IRC and The Cleveland Group "entered into a certain purchase agreement, whereby defendant IRC bought certain assets and assumed certain liabilities (excluding the liabilities due and owing the liquidating agent) of The Cleveland Group Ltd."

The collapse of the credit union cost the National Credit Union Share Insurance  Fund roughly $170 million in one of the largest credit union failures in history. The credit union's former CEO, Anthony Raguz, pleaded guilty to issuing the loans and accepting more than $500,000 in bribes, kickbacks and gifts from the borrowers. More than 1,000 fraudulent loans, totaling more than $70 million, were made to 300 account holders.

Media topics MBLs philosophy reasons to switch

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MADISON, Wis. (5/31/12)--Raising the member business lending  (MBL) cap so credit unions can help put Americans to work, credit union philosophy and history, and reasons to switch to credit unions were all highlighted in various media  in the past few days.

The Richmond Times-Dispatch recently published three letters to the editor in support of MBL legislation from credit unions.  The latest letter, written by Rick Pillow, president of the Virginia Credit Union League, appeared Wednesday. It closely followed one published Monday by Jane Watkins, president/CEO of Virginia CU, Richmond. Earlier in the month, Susan J. Adams, president/CEO of Entrust Financial CU, Richmond, wrote a letter published on May 2.

All three letters respond to an April 25th letter by the Virginia Bankers Association (VBA) criticizing "aggressive credit unions" for seeking "congressional favor" in a "lobbying blitz" on behalf of Senate Bill 2231, which would raise the MBL cap to 27.5% of assets from 12.25%. (To access each letter, use the links.)

The VBA's letter "attempts to paint this legislation as a congressional favor for the nation's member-owned, not-for-profit credit unions. The reality is that this bill would help a special interest group we all support--our families, friends and neighbors," Pillow wrote Wednesday.

"Lawmakers say putting Americans back to work is their No. 1 priority. Small business is the primary engine for job creation. SB 2231 would help credit unions provide needed loans to small businesses," Pillow wrote.

"The nation's banks had their chance to help small business when small business needed it most, but the banks failed to do so. Banks have worked for the past three years to repair balance sheets damaged by a financial crisis for which they shoulder the blame. They have been given trillions in aid and they now have the audacity to block common-sense legislation that would put Americans back to work without costing taxpayers a penny," he concluded.

Watkins' letter noted that "bankers' lobby wants limits on the choices available to small businesses," but "The simple truth is that consumers want business services and loans from the credit unions they trust with their personal banking needs. Members have asked repeatedly for our credit union to provide these services to them. Meanwhile, VBA wants to preserve an arbitrary lending cap that keeps credit unions from helping their members." 

She noted the "artificial lending cap, which didn't even exist before 1998, was put in place to appease the banks. Congress should act to raise the cap and enable credit unions to meet the needs of their members."

Adams, in her letter, wrote, "Credit unions are only asking Congress to increase this lending cap so more capital can be placed in our economy to help more of our fellow Americans. We have the money to lend and we want to fulfill our responsibility to help our communities." She urged congress to "vote yes on S. 2231 and help create more jobs for Virginians."

The Credit Union National Association and credit unions assert that raising the MBL cap would inject $13 billion in new small business loans into the economy and help create 140,000 new jobs the first year, at no cost to the taxpayer.

MBLs wasn't the only topic related to credit unions in the media.  The Modesto Bee on May 27 carried a love letter to credit unions from a Modesto, Calif., resident, who listed "Ten reasons why I use a local credit union and not a big bank."  The reasons range from "It is nonprofit and I'm a voting shareholder" to "minimum service fees: to "not too big to fail." Use the link to see the full list.

Two other articles touted credit unions. The South Bend Tribune on May 27 in an article entitled "Credit Union All About Membership," documented Imeco FCU's service to members and consumers' distrust of big banks' fees.

The Idaho State Journal (May 29) in "The history of credit unions" noted that "Credit unions have been a part of American life for generations. The concept was at the heart of Frank Capra's 'It's a Wonderful Life,' where George Bailey's local building and loan made a difference in the quality of life for the working families of fictional Bedford Falls." The article is written by Dan Cravens, a regional economist for the Idaho Department of Labor in Pocatello, and outlines the history of credit unions, noting that "credit unions in America today are a major financial force."

Web experience Amazon CUs ranked tops in ratings

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WABAN, Mass. (5/31/12)--Credit unions and Amazon.com were among the top-rated organizations and industries ranked according to the Web experience they provide. 

Temkin Group announced the release of its 2012 Temkin Web Experience Ratings that examine how U.S. consumers rate the online experiences of 159 large companies across 18 industries. This is the second year that Temkin Group has published these ratings.

Consumers gave the highest marks for Web experience to Amazon, credit unions, USAA, PNC, Southwest Airlines, eBay, Sam's Club, ShopRite, JCPenney and ING Direct.

Amazon.com had the No. 1 rating at 76%, followed by credit unions in the No. 2 spot with a 69% rating.

Credit unions also were near the top for the 2012 Temkin Trust ratings, which measure customer trust. Credit unions garnered a 75% trust rating, second behind USAA with 78%.

Consumers gave the lowest marks for Web experience to Charter Communications, Humana, Qwest, Cigna, Time Warner Cable, Anthem, Road Runner, Medicare, Blue Shield of CA and TracFone.

The ratings are based on a survey of 10,000 U.S. consumers in January that covers 18 industries: Airlines, appliance makers, auto dealers, banks [including 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.

"The online channel is increasingly becoming the front door to brands, but many companies still provide underwhelming Web experiences," said Bruce Temkin, author of the research and managing partner of Temkin Group. "The changes between 2011 and 2012, however, are encouraging since we found that most companies are improving."

Temkin Group examined industry averages and found that banks [including credit unions] and investment firms have earned the highest Temkin Web Experience Ratings followed by hotel chains and retailers. But consumers gave very low ratings to Internet service providers, health plans and TV service providers.

The research also examines how individual companies are rated relative to their industry peers. These 11 firms outscored their industry average Temkin Web Experience Ratings by 10 percentage points or more: Kaiser Permanente, Amazon, ShopRite, Southwest Airlines, USAA, Starbucks, H.E.B., Publix, credit unions, Marriott and Apple.

These 15 companies fell 10 percentage points or more below their industry averages: Wells Fargo Advisors, AAA, Charter Communications, Delta Airlines, Citibank, Bank of America, Humana, TracFone, Qwest, Old Navy, U.S. Airways, Rite Aid, Kohl's, Kmart and Charter Communications.

Temkin Group also analyzed changes in Temkin Web Experience Ratings between 2011 and 2012. Led by TV service providers and insurance carriers, 11 of the 12 industries that were in both the 2011 and 2012 ratings improved since last year.

Seventy-two percent of companies that were in the 2011 and 2012 Temkin Web Experience Ratings showed improvement. Led by Comcast (Internet and TV service), Allstate, AOL, Charter Communications, Toshiba and Sam's Club, 20 companies improved by 10 percentage points or more between 2011 and 2012. Three companies--Kohl's, TracFone and Rite Aid-- declined by 10 percentage points or more during that timeframe.

To see analysis of the ratings, use the link.

Gov. taps Boatright for chiropractic examiners board

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AUSTIN, Texas (5/31/12)--Texas Gov. Rick Perry appointed Anne Boatright, president/CEO of Austin, Texas-based Capitol CU, to the Texas Board of Chiropractic Examiners for a term to expire Feb. 1, 2015.

The board licenses chiropractors and chiropractic facilities, and registers chiropractic radiological technicians (LoneStar Leaguer May 30).

Boatright is a member of the Austin Credit Union Manager Association, the Texas Credit Union League (TCUL) Legislative Affairs Committee and the Credit Union National Association. She is a member and past board chair of the Austin Chapter of Credit Unions.

She is past chair of the TCUL board of directors and a past trustee of the Texas Credit Union Foundation.

Boatright is a graduate of the Southwest CUNA Management School.

Connecticut GAC attracts 50 CUs

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Tony Emerson, president/ CEO of the Credit Union League of Connecticut, pauses in conversation with U.S. Rep. Chris Murphy (D-Conn.) following Murphy's speech at the league's Governmental Affairs Conference in Hartford, Conn.
MERIDEN, Conn. (5/31/12)--More than 50 representatives from Connecticut credit unions gathered in Hartford to hear eight speakers from the political arena at the Credit Union League of Connecticut's Governmental Affairs Conference held Tuesday.

The four-hour session involved updates on Connecticut credit union issues and federal issues affecting all credit unions, and assessments of how credit unions positively affect the state's economy.

Hot topics included the federal deficit and its overall effect on the economy, jobs in general and preparing young people for employment, the state of Connecticut's budget deficit, and dealing with the foreclosure issue.

Speakers included:

  • U.S. Rep. Chris Murphy (D-Conn.);
  • Connecticut Lieutenant Governor Nancy Wyman;
  • John Rossi, chief of staff for U.S. Rep. John Larson (D-Conn.);
  • Mark Pazniokas, capitol bureau chief, Connecticut Mirror;
  • U.S. Sen. Richard Blumenthal (D-Conn.) meets with Credit Union League of Connecticut President/CEO Tony Emerson before the senator's presentation at the Connecticut Governmental Affairs Conference Tuesday in Hartford. (Photos provided by the Credit Union League of Connecticut).
    Connecticut  Department  of Banking Commissioner Howard Pitkin;
  • State Rep. and Minority Leader Lawrence Cafero (R);
  • State Senator and Banks Committee Co-Chair Bob Duff (D); and
  • U.S. Sen. Richard Blumenthal (D-Conn.).


"It is extremely important for us to provide our members with great opportunities to hear about issues of importance affecting them, and to meet with our elected officials both in Washington, D.C., and in Connecticut," said Kelly Fuhlbrigge, league vice president, government relations.

"It is equally important for our elected officials to see that credit unions are a collective force," Fuhlbrigge added. "I believe we accomplished all of these goals here in Connecticut today with our Government Affairs Conference."

"We are fortunate to have local access to our legislative representatives," said Tony Emerson, president/CEO of the league. "Face-to-face dialogue makes for more effective communication that can only yield to positive results for credit unions and their members."

Credit scores for auto loans drop CUs gain market share

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SCHAUMBURG, Ill. (5/31/12)--Credit unions have gained vehicle loan market share while the average credit scores from consumers purchasing vehicles have dropped to near prerecession levels, according to Experian Automotive's quarterly automotive credit analysis.

Credit unions grew their market share by 10.85%--to 16.89%--during the first quarter, according to Experian.

Overall, the auto lending environment appears to be on the rebound, Experian said.

"Our report shows automotive lending is as healthy as it's been since the market bottomed out in 2008," said Melinda Zabritski, director of automotive credit for Experian.

The average credit score for financing a new vehicle dropped six points to 760 and dropped four points to 659 for used vehicles. Comparatively, credit scores in the first quarter of 2008 were at an average of 753 for new vehicles and 653 for used.

Credit unions' increased market share could be explained in part by their ability to set lower terms. Lenders overall continued to set favorable terms for consumers during the first quarter, said Experian. Interest rates were lower year-over-year and loan terms were longer, giving consumers access to potentially lower monthly payments. For example, the average interest rates dropped to 4.56% on new vehicle loans and to 9.02% for used. The average loan terms also increased, extending by one month for new and used vehicles to a total of 64 and 59 months, respectively.

"During the first quarter of 2012, car shoppers definitely found more favorable conditions for their vehicle loans," said Zabritski. "A reduction in average credit scores, lower interest rates and a lengthening of loan terms are all very good signs for the market and offer great opportunities for consumers looking to make a deal on a new or used vehicle."

The analysis also showed an increase in the average amount financed. The average amount financed on new vehicles rose by $589 in the first quarter, reaching a total of $25,995. For used vehicles, the average amount financed increased by $411, bringing the average total to $17,050.

"With consumers doing a good job of paying back loans on time and the percentage of dollars at risk reaching its lowest point in six years, lenders are able to extend terms and provide lower rates," Zabritski said. "This thawing of the credit pipeline has been good for everyone, from consumers to lenders to automotive retailers."

Some additional highlights from the first quarter:

  • Vehicle loans to nonprime, subprime and deep-subprime customers increased by 11.4%;
  • Auto repossession rates were down by 37.1%;
  • Thirty-day delinquencies dropped by 7.6%; 60-day delinquencies dropped by 12.1%; and
  • Banks gained market share by 7.5% to 40.21%.

CUNA Mutual Holding Co. re-elects four directors

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MADISON, Wis. (5/31/12)--Four directors were re-elected to the CUNA Mutual Holding Co. board of directors at the company's policyholders' annual meeting May 23.

Directors re-elected to three-year terms were:

  • Joseph Gasper, retired president/chief operating officer, Nationwide Insurance;
  • Thomas Godlasky, retired CEO, Aviva North America;
  • Robert Marzec, retired audit partner, PricewaterhouseCoopers; and
  • Randy Smith, CEO, Randolph-Brooks FCU, Live Oak, Texas.
Eldon Arnold, retired president/CEO of CEFCU, Peoria, Ill., was elected board chair and Alan Peppers, president/CEO of Westerra CU, Denver, was elected vice chair at a board meeting following the annual meeting.

Announcing her retirement from the board of directors was Vicky Miller, retired executive vice president and chief financial officer of Turner Broadcasting Systems. Board candidates are being reviewed to fill her vacancy.

Other CUNA Mutual Group board members include:

  • Loretta Burd, president/CEO, Centra CU, Columbus, Ind.;
  • James Zilinski, retired chairman, president/CEO, Berkshire Life Insurance Co.;
  • Bert Hash, president/CEO, Municipal Employees CU of Baltimore (Md.) Inc.;
  • Farouk Wang, retired director Buildings & Grounds Management, University of Hawaii;
  • Larry Wilson, president/CEO, Coastal FCU, Raleigh, N.C.; and
  • Jeff Post, president/CEO, CUNA Mutual Group.

CO-OP Financial Services elects officers

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RANCHO CUCAMONGA, Calif. (5/31/12)--Terry Laudick, president/CEO of New Mexico Educators FCU, Albuquerque, N.M., has been elected to a one-year term as chairman of the board of CO-OP Financial Services.

Laudick was also re-elected to the board by shareholders for a third and final three-year term last month. He has served as a CO-OP board member since 2006.

The 11-member board also elected three other members to officer positions, including:

  • Vice chairman/chairman-elect--Doug Ferraro, president/CEO, Bellco CU, Greenwood, Colo.;
  • Treasurer--Jeff Napper, president/CEO, LBS Financial CU, Westminster, Calif.; and
  • Secretary--Allan McMorris, president/CEO, Oakland County CU, Waterford, Mich.
Shareholders also re-elected two board members to third terms. They are:

  • Rick Craig, president/CEO, America First CU, Riverdale, Utah; and
  • Patsy Van Ouwerkerk, president/CEO, Travis CU, Vacaville, Calif.
CO-OP Financial Services provides network, payment processing, e-commerce, shared branching and call center services.

CU System briefs (05/30/2012)

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  • SOUTH BURLINGTON, Vt.(5/31/12)--After nearly 30 years, the Association of Vermont Credit Unions (AVCU) will be relocating its office on Friday, moving from its South Burlington headquarters to Water Tower Hill in Colchester. It will occupy about one third of the top floor of the office building at 401 Water Tower Circle, said AVCU's newsletter, Newslines Express (May 25). AVCU decided to move after its current landlord, New England FCU, announced plans to redevelop the building.  The credit union purchased the building from the league in the late 1990s. The association had been at the location since 1983, when it moved from a smaller office in Montpelier …
  • KANSAS CITY, Mo. (5/31/12)--Kansas City, Mo.,-based Mazuma CU has hired its first "chief culture officer"--Matt Monge, who has human resources experience and expertise in employee and organizational culture development within a credit union environment. The credit union stresses that a healthy organizational culture of high morale, high productivity, minimal confusion, minimal politics and low turnover unlocks the potential with people and provides "one of the biggest competitive advantages out there right now," said Monge. Before joining Mazuma, Monge was vice president of people and development at Fort Campbell FCU, Clarksville, Tenn. At Mazuma, he will lead the culture, organizational development and human resources efforts
  • HARRISBURG, Pa. (5/31/12)--April Singleton of Downingtown, Pa., representing the Lan-Chester Chapter of Credit Unions was named 2012 Credit Union Youth Ambassador of Pennsylvania, announced the Pennsylvania Credit Union Association (PCUA). The annual statewide contest was held during PCUA's 78th Annual Convention & Expo in Pittsburgh earlier this month. Singleton, 25, is an ebusiness Web specialist at Citadel FCU in Exton and a business management and finance student at Delaware County Community College. She will represent PCUA at events for the next year.  First alternate was Andrea Garner, 23, Pittsburgh, marketing coordinator at Pittsburgh Central FCU, Sewickley, who represented the Pittsburgh Chapter of Credit Unions. Second Alternate was Matthew Lynn, 24, of Huntingdon Valley, a member service representative at TruMark Financial CU, Trevose, and representing the Montgomery Chapter of Credit Unions. Thirteen finalists competed in regional contests before advancing to the state finals. PCUA conducts the contest to attract young people to credit unions and prepare them for leadership roles …
  • COLUMBIA, S.C. (5/31/12)--Ninety-five youth helped the credit unions of South Carolina play "MAD TAG Plinko" Saturday at the Piccolo Spoleto Children's Festimval in Charleston, S.C., to raise $2,730 for Children's Miracle Network Hospitals via the Carolinas Credit Union Foundation.  Credit unions attended as part of an ongoing 2012 Community Tour by cooperatives led by Cabot Creamery of Vermont. Children were invited to "Make a Difference…" by dropping a disc through a Plinko board to determine the contribution made in their name to the hospitals. In turn, the youth received Credit Unions for Kids stickers, "South Carolina Credit Unions are…aSmarterChoice.org" penciles, and MAD TAG cards encouraging children and their families to pass along the goodwill and share their stories at www.madtag.org. Game slots ranged from 50 cents to $5 and the total contribution for the day was $273. South Carolina credit unions added a zero to each amount achieved in the game, making the contribution to the hospitals a tenfold total contribution. Children's Miracle Network Hospitals is a primary focus of the "MAD TAG: Make a Difference…Pass It On" campaign, which includes sponsorship of the hospitals' radiothons statewide.  Here, SC Palmetto Protégé Dizzy Felkel of SPC CU, Hartsville, helps a festival goer play MAD TAG Plinko. (Photo provided by the South Carolina Credit Union League) …

CU System briefs (05/29/2012)

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  • FORT KNOX, Ky. (5/30/12)--Leo C. Pike Jr., a longtime credit union volunteer and professional at Fort Knox (Ky.) FCU, died Thursday at age 87.  Pike served as a volunteer board member during his 28-year Army career and upon his retirement in 1974, joined the credit union as marketing director and operations manager. At the time of his second retirement, he was re-elected to the board of directors where he served as chairman and was subsequently named director emeritus.  Pike received the Defense Credit Union Council (DCUC) Hall of Fame Honor Award in 2002. He also was a member of the DCUC board. The DCUC is an association representing credit unions operating on military installations worldwide. Services were held Tuesday in Vine Grove, Ky. …
  • HARRISBURG, Pa. (5/30/12)--Warren D. Evans, retired longtime board director and credit committee chairman of PSECU in Harrisburg, Pa., died Sunday at age 82, according to the Pennsylvania Credit Union Association (Life is a Highway May 29). Evans was a credit union volunteer for more than 30 years. In his career with the Pennsylvania Department of Education, he focused on policies for colleges and universities, the association said.  Evans retired as chairman of the $3.83 billion-asset PSECU's credit committee in 2006, after serving in that capacity for 30 years. He also was director for the Harrisburg Chapter of Credit Unions, and was the coordinator for the chapter's Youth Ambassador Contest. Evans was a U.S. Army veteran and served in the Korean War  …
  • FARMERS BRANCH, Texas (5/30/12)--Debra "Debbie" Kay Bonner, CEO of Brazosport Teachers FCU in Clute, Texas, died May 18 at her home in Lake Jackson, Texas, after a short battle with cancer. She was 56, according to the Texas Credit Union League (LoneStar Leaguer May 25). She dedicated 30 years of her life to credit union service and helped the credit union grow to $40 million in assets from $30 million.  She was a 2009 graduate of Southwest CUNA Management School and was CCUE certified. Services were held Saturday in Lake Jackson …

Idahos CUs raise 183795 for childrens hospitals

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BOISE, Idaho (5/30/12)--Idaho Credit Union League-affiliated credit unions donated nearly $184,000 to area children's hospitals through the Credit Unions for Kids program.

The funds were distributed to St. Luke's Children's Hospital in Boise ($69,797), Primary Children's Medical Center in Salt Lake City ($90,599), and Kootenai Medical Center in Coeur d'Alene ($32,919).

All the money raised in Idaho goes to benefit sick or injured children from Idaho, making Children's Miracle Network Hospitals the charity of choice for credit unions, the league said. Idaho credit unions have raised nearly $2.5 million during their 17-year relationship with the charity.

Credit unions generate funds for the Children's Miracle Network Hospitals in several ways. Some hold monthly gift basket drawings, others a holiday bazaar, while still others offer loan 'skip-a-payment' programs.

Children's Miracle Network Hospitals Telethons will be conducted the first weekend in June. Employees and volunteers from credit unions will participate as guests and telephone hosts to take contributions, said the league.

Police cleared in Feb. shooting of teen gunman at CU

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WEST PALM BEACH, Fla. (5/30/12)--Three Palm Beach County (Fla.) sheriff's deputies who shot and killed an 18-year-old gunman firing shots in the parking lot of a credit union on Feb. 10 have been cleared, according to the State Attorney's Office.

The incident occurred around 4 p.m. on Feb. 10 in the parking lot of PBC CU in West Palm Beach.

An investigation concluded that Chris Thompson, 18, allegedly shot at deputies to commit "suicide by cop" and after being shot 11 times  thanked the officers for shooting him, according to the office, which released a report filed by police in the incident.

Authorities also reported that the person who called 911 to report the gunman was actually Thompson, who would describe his actions to 911 operators as he fired a .22 caliber rifle.  When deputies arrived, he allegedly fired at a deputy's cruiser, hitting it three times and flattening a tire. The deputies returned fire. Thompson died at the scene.

Local news reports said Thompson had been distraught by the death of a friend and that he was on his way to a bank because he owed someone money (wptv.com May 25).

None of the deputies and no one inside the credit union were injured. According to Christine Weiss, spokesperson for the state attorney, the deputies saved the lives of people in the credit union (PalmBeachPost.com May 25). No charges will be filed and the case is closed, said the state attorney's office.

N.Y. Senate passes CU-backed robbery bill

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ALBANY, N.Y. (5/30/12)--A credit union-supported bill to increase robbery penalties and close a loophole in current law was passed by the New York State Senate last week, the Credit Union Association of New York (CUANY) said.

S.4194, introduced by Sen. Joseph Griffo (R-Utica-Rome), proposes to amend Section 160.10 of the Penal Law to expand the crime of robbery in the second degree to include property stolen from a banking institution.

The Assembly version of the bill, A.6872, is currently in the Assembly Codes Committee.

In recent years, there has been a significant increase in the number of credit union/bank robberies committed statewide, said CUANY. Despite efforts by law enforcement, regulators and financial institutions, there continues to be an apparent perception among criminals that robbery is an easy type of crime not taken as seriously as other types of crime, the association said.  

Increasing robbery penalties has been a legislative priority of the association for the past two years. Many New York credit unions impacted by robbery also have reached out to their representatives to advocate on the issue.

"We commend the Senate for passing this critical legislation that will help protect financial institutions, their employees and their members," said William J. Mellin, association president/CEO. "Credit unions across the state have played an essential role in advancing this legislation, and we will continue working to build the same support in the Assembly."

Northwoods CU to buy bank branch deposits

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CLOQUET, Minn. (5/30/12)--A credit union in Cloquet, Minn., has agreed to acquire a local branch office of North Shore Bank of Commerce, pending final approval from the National Credit Union Administration and the Federal Deposit Insurance Corp.

Northwoods CU, a $56.4 million asset credit union, will buy the bank's building, the branch's deposits and safety deposit boxes, while the bank will keep its loans, the bank told the Duluth News Tribune.  

The bank's customers with checking, savings, certificates and safety deposit boxes will automatically transfer to the credit union, unless they notify the bank before the deal closing, which is expected to be July 20.

Open eight years, the branch had nearly 800 customers, significantly fewer than the bank's other branches.

Northwoods, which also has branches in Carlton and Cloquet, had been looking to expand in Cloquet because it is growing, Barb Brown, the credit union's president, told the newspaper. It had originally planned to build an office next to the bank branch.

The credit union will hire three employees for its new branch, said the credit union. One of the bank's seven employees will work for the credit union; the other six employees have been offered other positions with the bank.

The announcement comes two months after credit unions in Klamath Falls, Ore., and Jackson, Miss., announced they were acquiring bank branches (News Now March 22).

Two PremierWest Bank branches in Dorris and Tulelake, Calif., that were scheduled for closure were transferred in a purchase and assumption agreement to Pacific Crest FCU in Klamath Falls, Ore.

Also,  Hope FCU, Jackson, Miss., announced in March that it had acquired the former BancorpSouth Branch in Utica, Miss. The bank closed the branch last August, leaving customers without banking services in the community.

Davis Johnson honored by Virginia league

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Kenneth R. Davis, left, CEO of the $8.6 million Hampton (Va.) V.A. FCU, was honored by Virginia's credit unions with the 2012 Eugene H. Farley Jr. Award of Excellence. Presenting the award is Virginia Credit Union League President Rick Pillow.
LYNCHBURG, Va. (5/30/12)--Two people--a credit union CEO, Kenneth R, Davis, and a retired credit union "legend," Eugene W. Johnson--were recently honored by the Virginia Credit Union League.

Davis, CEO of the $8.6 million asset Hampton (Va.) V.A. FCU, was honored by Virginia's credit unions with the 2012 Eugene H. Farley Jr. Award of Excellence. The award is given to credit union professionals and volunteers in recognition of extraordinary service to their credit union or the credit union system.

Davis was recognized for his efforts in aiding his former employer, Portsmouth VA City Employees FCU, while transitioning to his new job leading Hampton V.A. FCU. He spent nights and weekends working to ensure Portsmouth VA City Employees FCU, a $3.5 million credit union, could continue to operate, while looking for a new manager. Portsmouth VA employs only a manager, one full-time teller and a part-time teller.

"Small credit unions seem to draw people blessed with limitless optimism and determination," said Virginia Credit Union League President Rick Pillow. "Kenny truly is the personification of the dedicated small credit union manager, and his passion for the movement and for the members at every credit union with which he's been associated, are a testament to the fact that he lives and breathes our 'People Helping People' philosophy."

Davis has been a long-time champion of small credit unions, having led or been involved in various initiatives dedicated to aiding small credit unions.

Eugene W. Johnson, left, a legend in Virginia's credit union movement, was honored with the Virginia Credit Union League's James P. Kirsch Lifetime Achievement Award. He is shown with Virginia Credit Union League President Rick Pillow. (Photos provided by the Virginia Credit Union League)
Eugene W. Johnson was honored April 27 with the James P. Kirsch Lifetime Achievement Award. The award is given by Virginia's credit unions in recognition of extraordinary service and commitment to the credit union system.

The 84-year-old Johnson was first introduced to credit unions in 1949, securing a $300 loan with the help of a co-worker, who co-signed his loan.

"Anything over $100 required a co-maker in those days, but I couldn't find anyone able to co-sign the loan, having just started at Hampton Institute," Johnson said. "But I remember Georgia Griffin's act of kindness in co-signing that loan really touched me. That was credit union's people helping people philosophy in action. I would have walked the water before I would have ever let her pay anything on that loan."

Johnson joined the Hampton Institute credit union's supervisory committee soon after, and has been a credit union booster ever since. The credit union later became Hampton University Employees FCU, which merged in the late 1990s with Virginia Educators CU, a now $56 million credit union headquartered in Newport News. He still serves on the credit union's board of directors.

"Anyone who has ever talked credit unions with Eugene Johnson knows the depth of his passion for the movement and for our unique philosophy," said Pillow. "I look back on the volunteers and professionals over the years who have helped shape Virginia's credit union system, and Eugene Johnson is among our founding fathers."

Johnson was the first African-American to serve on the league board, spending 15 years in service to Virginia's credit union system.

MCUA creates office for small CUs

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ST. LOUIS (5/30/12)--The Missouri Credit Union Association (MCUA) has announced changes to its organizational structure to create a new Office of Small Credit Unions.

The new office was created to offer a special resource for the needs--especially in the areas of compliance, financial performance and reporting, and income growth--of more than 90 credit unions in the state with less than $30 million in assets, the MCUA said.

Kevin Shaw will serve as director of the Office of Small Credit Unions. Prior to his promotion, Shaw was a field representative for MCUA.

"We are developing a network that will supply leaders of small credit unions the tools to make quick and sound decisions to manage risk and growth," Shaw said. "We will be an extension of MCUA and adopt the philosophy of 'making small credit unions grow.' It is critical that Missouri's small credit unions achieve their full potential, and we will be there to make it happen."

Karen Baker has joined the Office of Small Credit Unions as a certified compliance expert. She will focus on providing resources to keep small credit unions in compliance in a growing regulatory landscape. Baker has been with MCUA for 26 years.

Virginia league elects board officers

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LYNCHBURG, Va. (5/30/12)--The Virginia Credit Union League announced results for its recent board elections, including board officers.

Officers include:

  • Chairman--Suzanne Hodgins of the University of Virginia Community CU, Charlottesville, representing Region III credit unions with $50 million or more in assets;
  • Vice chairman--Paul Phillips, president/CEO Freedom First FCU, Roanoke, as an at-large director;
  • Secretary--Rose Gilliam, president/CEO at Argent CU, Chester, as an at-large director; and
  • Treasurer--Karen Orie, manager/CEO of Hampton Roads Educators' CU, Hampton, representing Region I credit unions with less than $50 million in assets.
Hodgins and Orie also were re-elected to the serve on the board.

Also, re-elected was Nancy Hollyfield, manager/CEO of Mountain Empire FCU, Marion, to represent credit unions with less than $50 million in assets in Region IV.

Elected to their first terms were:

  • Patsy Smith, manager/CEO of Resources FCU, Richmond, to a three-year term as an at-large director.
  • Joe Thomas, president/CEO Fairfax (Va.) County FCU, to a one-year term as a at-large director.

Corporate One announces 2012 board officers

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COLUMBUS, Ohio (5/30/12)--Corporate One FCU, a corporate credit union based in Columbus, Ohio, announced the results of its board elections, including board officers, following its annual meeting in April.

New board officers include:

  • Chairman--Gerald D. Guy, president/CEO of KEMBA Financial CU,  Columbus;
  • Vice chairman--Janice L. Thomas, president of PSE CU, Parma, Ohio;
  • Treasurer--John J. Shirilla, president/CEO of Best Reward CU, Walton Hills, Ohio; and
  • Secretary--Phillip R. Buell, CEO of Superior FCU in Lima, Ohio.
Re-elected to three year terms on the board were:

  • Buell;
  • Robert Burrow, president/CEO of Bayer Heritage FCU in Proctor, W. Va; and
  • R. Lee Powell Jr. of DESCO FCU in Portsmouth, Ohio.
The remaining board members include:

  • Charles Plassenthal, CEO of Dayton Firefighters FCU, Dayton, Ohio;
  • Sonja Delaney, CEO of Midwest Community FCU, Defiance, Ohio; and
  • Jeffery Meyer, CEO of Three Rivers FCU in Fort Wayne, Ind.


Michigan governor signs CU-backed small claims law

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LANSING, Mich. (5/30/12)--Michigan Gov. Rick Snyder has signed a law, supported by the Michigan Credit Union League, that increases the state's small claims court threshold, according to the league.

The measure, now known as 2012 PA 142, was overwhelmingly approved in both the state House and Senate (Michigan Monitor May 29). It will raise the small claims court threshold to $5,000 from the current $3,000, effective Sept. 1. After that, the threshold would rise $500 every three years, culminating in a $7,000 limit beginning Jan. 1, 2014.

The $5,000 threshold would surpass similar thresholds in more than 20 other states, said the league.

The new law is considered a boon for businesses and consumers, said MCUL CEO David Adams. "MCUL has devoted a great deal of time and effort to advocating on behalf of credit unions for this common-sense legislation that will significantly improve access to small claims court for both consumers and businesses," Adams said.

The legislation was introduced by state Sen. Tonya Schuitmaker (R-Lawton), who is the league's lawmaker of the year.

Georgia CUs support Cabot Creamery bike tour

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DULUTH, Ga. (5/29/12)--The Coastal Empire Credit Union Chapter in Georgia welcomed the cyclists of the Cabot Creamery 2012 Community Tour to Savannah, Ga., at a reception held downtown on Wednesday, said the Georgia Credit Union Association.

The cyclists spent an overnight stop in Savannah during their 2,300-mile bicycle ride along the East Coast Greenway. The tour started in Miami on May 12 and will end on July 7 in Portland, Maine.

The chapter provided snacks and beverages to refresh the cyclists, including a husband and wife team from John's Creek, Ga., who will participate in the entire tour.

"We're happy to host the cyclists and welcome them to Savannah," said Don Hill, president/CEO of Memorial Health Credit Union and Coastal Empire Credit Union Chapter president. "This is a great way to show the spirit of the cooperative movement. We're proud to partner with Cabot for this event."

Cabot Creamery is a farm family-owned cooperative located in Vermont producing all natural, award-winning cheeses. The 2012 Community Tour, sponsored by Cabot Creamery, was created to spotlight the power of cooperatives during the International Year of Cooperatives, as well as to celebrate those who give their hearts, time and skills to strengthen communities.

"Our Community Tour is an opportunity to spread the word about co-ops, communities and volunteerism," said Michelle Silver, project manager at Cabot Creamery Cooperative. "We're so pleased that Georgia credit unions joined us in this effort to celebrate those who give of themselves to strengthen our communities."

Cabot Creamery Cooperative is one of the sponsors of the Credit Union National Association's Weekly Home & Family Finance Radio Show

Also, credit union volunteers in the North Carolina Research Triangle area of Chapel Hill-Durham-Raleigh will join to participate in a Co-op-A-Fair event in Durham on Saturday, according to the North Carolina Credit Union League. Several Co-op-A-Fairs are planned along the tour route.

North Carolina's Team Little Guy will ride the route for 366 miles in North Carolina to raise money for the Charlotte-based Levine Children's Hospital Rooftop Garden Renovation project. When the 2012 Democratic National Convention ends, credit unions will leave behind a rejuvenated children's playground on the rooftop of the hospital. The Credit Union National Association, state credit union leagues, credit unions nationwide and the National Journal are working with the Democratic National Convention Committee to complete the project in time for the September convention (News Now April 6).

Improving economy still poses some concerns CU CEO survey

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PLANO, Texas (5/29/12)--Credit union CEOs polled in a recent survey expressed some concern regarding their own institutions' financial performance, amid an overall positive view of the economy, according to Catalyst Corporate FCU in Plano, Texas.

Catalyst Corporate FCU's First Quarter 2012 CU CEO Confidence Index notched up 1.55 points over the previous quarter's measurement to land at 28.36, slightly higher than the midpoint of the eight-year-old survey's historical high and low. However, CEO confidence in their own credit unions' financial condition--now and six months into the future--declined slightly by 3.23 and 1.28 points, respectively.

Doug Mountain, president/CEO of Legacy FCU Union in Portland, Ore., acknowledged that he has found little cause for optimism recently. Weak return on investments and increasing regulatory demands contribute to Mountain's dampened spirits, but a 400-employee layoff by his sponsor company has dealt the heaviest blow to this credit union.

"We are a single-sponsor credit union, and our sponsor is in the healthcare industry. Healthcare lags economic recovery because until people have jobs, they don't have benefits to pay for their medical needs," Mountain said.

Member employment concerns have caused Legacy FCU's loan-to-share ratio to plunge, Mountain said. "Loan volume is non-existent, even though we are offering new car loans at 2.48%. And the layoffs will impact our collection efforts down the road. It's tough," he concluded.

Although survey participants seemed somewhat uneasy about their own institutions' condition, many appeared more positive regarding their members' finances. CEOs rated "members' current financial condition" four points higher and "members' financial condition in six months" almost one-quarter point higher than the marks recorded in the Fourth Quarter 2011 survey.

CEOs also indicated that they anticipate greater loan demand (up 2.73 points) and share growth (up 6.3 points) in six months.

"The credit union industry's projected first quarter 2012 loans-to-assets ratio has fallen to 57.2% from first quarter 2011's ratio of 59.8% but initial estimates for first quarter 2012 generally show economic improvement over first quarter 2011," said Brian Turner, Catalyst Strategic Solutions' director and chief strategist. "If the nation's employment picture continues to improve, consumer spending--and member financing of large purchases--should gain traction."

Begun in 2004, Catalyst Corporate's quarterly survey measures CEO confidence from very negative to very positive (-100 to +100) in six key areas. Questions are designed to capture a snapshot of CEO present state of mind, as well as future expectations. The areas CEOs are asked to evaluate are:

  • Current financial condition of members;
  • Current financial condition of the credit union;
  • Anticipated financial condition of members in six months;
  • Anticipated financial condition of the credit union in six months;
  • Anticipated loan demand at the credit union in six months; and
  • Anticipated share deposit growth at the credit union in six months.
Questionnaires for the most recent survey were sent to 1,344 CEOs of Catalyst Corporate and Western Bridge Corporate FCU member credit unions in April. Responses numbered 278 for a response rate of 20.68 %.

Additional details, including graphs with the survey's historical data, are available. Use the link.

A.M. Best gives CUNA Mutual businesses excellent financial ratings

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MADISON, Wis. (5/9/12)--Financial ratings agency A.M. Best on Wednesday affirmed the financial strength rating of CUMIS Insurance Society (CUMIS) at "A" (Excellent) and upgraded the financial strength rating of Producers Agriculture Insurance Company (ProAg) to "A" (Excellent). Both are CUNA Mutual Group businesses.

CUMIS (property and casualty insurance) and ProAg (crop insurance) are subsidiaries of CMFG Life Insurance Company. Both subsidiaries' outlooks remain stable.

In assigning the "A" rating to CUMIS and elevating ProAg from "A-" to "A," A.M. Best cited both companies' strong level of risk-adjusted capitalization. The "A" rating is the third highest rating of 16 categories of ratings A.M. Best issues. 

A.M. Best cited CUMIS' conservative balance sheet, overall operating profitability and well-established niche position in the credit union marketplace. "The ratings further reflected the financial flexibility and diversified operations of CMFG (Life Insurance Co.)," A.M. Best said.

"CUNA Mutual Group has worked hard to bring greater value to credit unions and their members through our products and services, while keeping premiums down," said Jeff Post, CUNA Mutual president/CEO. "We are pleased A.M. Best cited our diversification strategy in acknowledging our strong performance."

In upgrading ProAg, the ratings agency recognized the support its reinsurance agreement with CUMIS provides, its business profile as one of the largest providers of crop insurance and its experienced management team. 

Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors.

CUNA CFO Council announces Executive Committee

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MADISON, Wis. (5/29/12)--The coming year's executive committee and officers for the CUNA CFO Council were announced during the council's 18th annual CUNA CFO Council Conference, May 20-23, in Fort Lauderdale, Fla. This is a result of the most recent annual election by the council membership in the months preceding the conference.

David D'Annunzio, senior vice president and chief financial officer for Heritage Trust FCU in Charleston, S.C., will remain council chair, and Pam Finch, vice president of administration and chief financial officer of Mid Minnesota FCU in Baxter, Minn. will remain vice chair. Suzanne Weinstein, chief financial officer for Orlando FCU in Orlando, Fla. will become the secretary/treasurer.

During recent elections, Jason Peach, senior vice president and chief financial officer for West Community CU in O'Fallon, Mo., Bryanna Tapley, chief financial officer for CP FCU in Jackson, Miss. and John Meeker, senior vice president and chief financial officer for Caltech EFCU in La Canada Flintridge, Calif. were elected to their first terms on the executive committee. They replace outgoing members Robert Warren Jr., senior vice president and chief financial officer of Virginia CU in Richmond, Va., and Kevin Durrance, chief financial officer for Texans CU in Richardson, Texas. 

The committee is rounded out by:

  • Kevin Brueseke, chief operating officer and chief financial officer for the Missouri Credit Union Association in Saint Louis, Mo.;
  • Joan Hill, vice president of accounting for VyStar CU in Jacksonville, Fla.;
  • Sonya Jaynes, chief financial officer/strategic planning coordinator, Red River Employees FCU, Texarkana, Texas;
  • William Kennedy, chief financial officer for Jersey Shore FCU in Northfield, N.J.; and
  • Mary Torsney, senior vice president and chief financial officer for Financial Partners CU in Downey, Calif.

Idol appointed to NASCUS CU Executive Council

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ARLINGTON, Va. (5/29/12)--Patty Idol, president of Mountain CU, Waynesville, N.C., has been appointed to serve as a director on the NASCUS Credit Union Executive Council.

Council Chairman Cathie Tierney, Community First CU, Appleton, Wis., appointed Idol to fill the unexpired term of Jim Blaine, State Employees' CU, Raleigh, N.C., who is not seeking re-election after more than a decade of service on the NASCUS Credit Union Executive Council.

Idol has been the president of Mountain CU since 1999 and has been active in both NASCUS and the North Carolina Credit Union League (NCCUL) for many years. She is vice chairman of the NCCUL board and serves as treasurer of the Western Chapter of NCCUL. Idol's term on the NASCUS Council will run until September.

The NASCUS Credit Union Advisory Council is governed by an Executive Council, a group of 12 directors who are credit union executives from around the country.

To view the Executive Council members, use the link.

Maine announces Young and Free spokester

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PORTLAND, Maine (5/29/12)--After a search that drew applicants from 18- to 25 year-olds statewide, interviews and an online vote that attracted thousands of votes, Maine credit unions have found their next Young and Free spokester.

Kylie Keene, a 22-year-old from Old Town, Maine, is the winner of the Young and Free Maine spokesperson job search.

Beginning July 1, Keene will become the new spokester for Maine's credit unions speaking to and with the 18-25 year-old demographic about financial services and financial challenges.  

Keene discovered she had won the position at an announcement party in Farmingdale, Maine, where she was surprised by her friends and family, in addition to representatives from Maine credit unions. Keen will officially start her new position when the program's first spokester, Seth Poplaski of Bangor, completes his one-year term at the end of June.

"We were extremely impressed by the quality of the content our finalists created," said John Murphy Maine Credit Union League president/CEO. "Through the combination of her videos, blog entries, and how she spread the word about Young and Free Maine, Kylie was a stand-out applicant and proved that she has the writing skills, on-air presence and ability to communicate with Maine's 25 and under crowd that make her an obvious choice for this exciting opportunity.  This is a job like no other in Maine so we had a lot of interest from people wanting to become the next spokester."

As the spokester for Young and Free Maine, Kylie received a year-long contract with a paid salary and benefits, which was especially enticing for Keene who just graduated from the University of Maine.  During the year, she will serve as a reporter and advocate for her age group, attending events and creating daily online content including blog articles and videos to keep YoungFreeMaine.com an information hub for the 25-and-under crowd in Maine.

She also has been outfitted with a digital video camera, a smartphone with a paid contract, and a Mac Book Pro laptop, which she will keep to the end of her term.  She was also handed the keys to the Young & Free Maine vehicle, a Chevy Cruze, which she will have use of during her term. 

Keene won the position after taking part in a process that included submitting a sixty-second YouTube Video, writing blogs, in-person interviews and an online vote.  She beat out the two other finalists, Alex Gray, a 20-year-old from Charleston, and Danielle Waldron, a 24-year-old from Portland.

The search for the Young and Free Spokester is part of a greater initiative for 18- to 25-year-olds called Young and Free Maine. It includes a financial headstart with a new account called the Free4ME Account, designed with 18- to 25-year-olds in mind. Maine is the only New England state to offer this program, which has proven successful in connecting with Gen Y in regions throughout North America.

Mississippi league celebrates 75th anniversary

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Biloxi, Miss. (5/29/12)--More than 500 staff and volunteers, representing 60% of Mississippi credit unions, were present to help the Mississippi Credit Union Association celebrate its 75th anniversary at its annual meeting in Biloxi, Miss., May 16-19.

The event included historical photo slideshows, videos with MSCUA members recalling events and moments of the past and a take-home historical date and photo album featuring Mississippi credit unions. 

"We were honored to have hundreds of volunteers and staff, who together represented sixty percent of Mississippi credit unions, attend our 75th anniversary celebration," said Charles Elliott, MSCUA President/CEO.  "The event was an opportunity to showcase the 75 years of association, collaboration and cooperation, which is the basis of our past and future success,".

The MSCUA announced the results of its board elections at the meeting. Results were:

  • Re-elected to three-year terms were Laurin Avara, Navigator FCU, Pascagoula, and Ray Scott, University of Southern Mississippi FCU, Hattiesburg.
  • Elected to three-year terms were Katie Nelson, Mississippi Postal Employees FCU, Jackson, and Dennis Florreich, Meridian (Miss.) Mutual FCU.
  • Elected to fill an un-expired two-year term was Brig. Gen. Richard Moss (Retired), Keesler FCU, Biloxi.
MSCUA board officers are:
  • Chairman--Jimmy Smith, Singing River FCU, Moss Point;
  • Vice-Chairman--Billy Bridges, Mutual CU, Vicksburg;
  • Treasurer--Ray Scott; and
  • Executive Committee Member--John Gibbons, Triangle FCU, Columbus Air Force Base
Other MSCUA board members include:
  • Sheila Bridges, MBHS FCU, Jackson;
  • Elmer Dickens, Gulf Coast Community FCU, Gulfport;
  • Steve Pollman, Magnolia FCU; Jackson; and
  • Kaye Ray, Central Sunbelt FCU, Laurel.

PCUA announces board officers awards

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HARRISBURG, Pa. (5/29/12)--The Pennsylvania Credit Union Association (PCUA) announced its new board officers and top professional and volunteer awards at its 78th Annual Convention and Exposition.

Two officers were elected for one-year terms:
  • Chairman--Michael Kaczenski, president/CEO, Sun East FCU, Aston; and
  • Vice Chairman--Maria LaVelle, president/CEO, Westmoreland Community FCU, Greensburg.
Kaczenski represents credit unions with more than $100 million in assets and has served on the PCUA board since 2004.  He was elected chairman in 2011 and had previously served as vice chairman.

LaVelle represents credit unions with $30 million to $100 million in assets and was elected in to the board in 2009. 

David Baker, president and treasurer of York Educational FCU in York, was recognized with the William W. Pratt Lifetime Achievement Award for the 2012 Credit Union Professional of the Year.

Baker took over as manager of the credit union in 1971. Under his leadership, the credit union has grown from 134 members and $23,374 in assets, to more than 3,900 members and $26.5 million in assets. York Educational FCU serves 54 select-employee groups and operates a student branch at Red Lion Area High School.

Baker served on the PCUA's board of directors from 1988-1991; was a member of the Credit Union Advisory Council of the Federal Reserve Bank of Philadelphia, 1992-1994, serving as Chairman in 1994; and has been a member of Mid-Atlantic Corporate FCU's nominating committee since 2000.

Robert "Bob" Greek was named the Joseph A. Moore Award for the 2012 Outstanding Volunteer of the Year.

For more than 38 years, Greek has served as a volunteer in a variety of capacities for several Pittsburgh area credit unions and the PCUA Pittsburgh chapter of credit unions. In 1991, he was elected to the Pittsburgh Central Federal CU's board of directors and currently serves as chairman. For 25 years (1974-1999), he served as chairman of Union Electric Steel FCU, now Southwest Community FCU.

CUNA closed Monday for holiday (05/24/2012)

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MADISON (5/25/12)--The Credit Union National Association offices in both Washington D.C. and Madison, Wis. will be closed Monday, May 28 for Memorial Day. Also News Now will not be published on Monday. CUNA offices will reopen on Tuesday, May 29. News Now will also resume its regulator publishing schedule on Tuesday.

Liddle stabbing still a mystery

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PHOENIX (5/25/12)--Police are still searching for answers in the stabbing of William Liddle, the former vice president of business lending chief at AEA FCU.

Liddle was found stabbed in the chest minutes before he was to be sentenced for his role in the business lending fraud that led to the conservatorship of the $410-million credit union, chartered to serve the Arizona Education Association (Yuma Sun May 22).

Emergency medical services responded to a call to Liddle's Phoenix home about 12:50 p.m. Monday. He was found sitting upright with a minor stab wound to his chest. He was then transported to St. Joseph's Hospital, where he was treated and released about 3 p.m.

David Eisenberg, Liddle's attory, told U.S. District Court before Judge Susan Bolton that his client had been struck on the head in his back yard. When he regained consciousness, Liddle found a knife in his chest.

Liddle's sentencing has been rescheduled for June 1.

Liddle was to have been in at 1:30 p.m. Monday for sentencing. In February, a jury found Liddle guilty of 54 counts of conspiracy, fraud and money laundering in a case that led AEA FCU's collapse.

Liddle's wife, Rhonda, was sentenced Monday, and is scheduled to serve 12 months of home incarceration and five years of supervised release for her role in the case.

An FBI agent interviewed Liddle while he was at the hospital, Eisenberg wrote in a document he filed Tuesday with the court.

Idaho league recognizes outstanding volunteer professional

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BOISE, Idaho (5/25/12)--The Idaho Credit Union League warded its annual outstanding professional and volunteer awards at its 76th Annual Meeting

Robert Taylor, CEO of Idaho State University CU  in Pocatello was named the Outstanding Professional of the Year. Taylor also serves as vice chair on the board of the Idaho Credit Union League and serves on the league's Governmental Affairs Committee. He has been part of the Idaho credit union professionals and volunteers who have traveled to Washington, D.C., to meet with Idaho's congressional delegation.

Joan Erickson, chair of the Supervisory Committee at Clearwater CU, Lewiston, was honored as the Outstanding Professional of the Year. Erickson has served credit unions as both a professional and volunteer since 1969. She has served as a member and officer at the chapter level and served on the board of the Idaho league as a director and officer.



Erickson has prepared and taught classes on financial responsibility to junior and senior high school students, has conducted a six-week financial class for women sponsored by the local Women's Advocacy Group, and has provided financial training through consumer counseling groups.

She is the only recipient in Idaho to receive both the Professional of the Year Award (1991) and the Volunteer of the Year Award.

Southeast Corporate members approve Corporate One merger

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COLUMBUS, Ohio (5/25/12)--Corporate One FCU, in Columbus, Ohio, announced Wednesday that Southeast Corporate FCU members voted in favor of the merger between Tallahassee Fla.-based Southeast Corporate and Corporate One.

The vote was conducted through mail ballots and votes cast at a special member meeting Tuesday at Southeast Corporate's Tallahassee office. The official vote was 146 in favor of the merger and 2 opposed.

"With the difficulties of the economic crisis behind us, Southeast Corporate members are ready to move toward a brighter future, as indicated by their vote of approval on the merger with Corporate One," said Southeast Corporate President/CEO Brad Miller. "Our members understand the merger with Corporate One is the last opportunity to preserve their capital and protect the credit union movement from further losses; thankfully, it's also a tremendous opportunity for them to become a part of one of our industry's most financially competent and progressive corporates."

The next and final step in the merger process is the capital raise, which has been met with much success, Corporate One said. As of Tuesday, more than $59 million in capital has been committed toward the total goal of $75 million.

"The members of Southeast Corporate have been very supportive of the merger throughout the entire process, and we are pleased to have received their official seal of approval," said Corporate One President/CEO Lee Butke. "With the great progress we've made thus far in the capital raise, we anticipate we'll successfully meet our goal.

"However, we need those final capital dollars to ensure the merger is sound from a financial standpoint, and we'll continue to work diligently to earn every last commitment," he added. "Corporate One is a strong, stable corporate and we want the Southeast Corporate members supporting the merger through their capital commitments to feel comfortable with their decision to do so."

CEO letter to paper MBL bill will provide needed access to capital

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AUSTIN, Texas (5/25/12)--If Congress increases the ability of credit unions to provide capital to small businesses through member business lending (MBL) it will help rejuvenate the U.S. economy by freeing more money for small-business growth, a Texas credit union CEO said in a Wednesday letter to The Austin-American Statesmen.

Paul Trylko, president /CEO of Amplify CU, a $565 million-asset credit union, based in Austin, Texas, said Senate Bill 2231, known as the Member Business Lending bill will allow credit unions such as his to rise above the arbitrary cap implemented as part of the Credit Union Membership Access Act of 1998, when previously no cap existed.

"Two of the more obvious changes impacting Americans now are a sluggish economy with high unemployment and scarcity of loans for small businesses," Trylko wrote. "Increasing the amount of loans credit unions can make to small businesses will help rejuvenate our economy by making funds for expansion available to small businesses."

Also, credit unions provide something that doesn't readily appear on the bottom line or in a rate chart. "Most credit unions are local," Trylko wrote. "For example, Amplify CU serves members in a five-county area surrounding Austin. Anytime our members have questions, they can talk to someone right here in Austin. Our business members have the direct phone numbers of their relationship managers, and usually their cellphone numbers, too."

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase credit unions' member business lending (MBL) cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in business 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.

CUNA makes call for entries for ELLy Training Awards

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MADISON, Wis. (5/25/12)--The Credit Union National Association (CUNA) again will award outstanding credit union training programs and training professionals for their achievements at this year's CUNA Experience Learning Live! (ELLy) Training Awards, held at CUNA Esperience Learning Live! Sept. 30-Oct. 3 in Denver.

CUNA Experience Learning Live! is specifically designed for training professionals to improve the educational cultures at their credit unions. Participants of this annual conference learn how to maximize staff morale, strengthen volunteer dedication and increase the overall knowledge of their members.

The ELLy Awards are one of the only national awards presented to credit union trainers who contribute outstanding achievements to the field of professional staff development.

Awards are presented to credit union professionals from two asset divisions--less than and greater than $250 million in assets--and span across five categories:

  • Chi Phi Delta X II Award--Represents the best development of a Credit Union University, and its effect on staff learning and performance, using CUNA's Center for Professional Development products as the foundation.
  • eLearning Award--Presented to participants who demonstrate how their use of technology-based training has enhanced their credit union training initiatives.
  • Training Champion Award--Recognizes senior management staff members who go beyond the call of duty to support and develop their credit union's training program.
  • Training Professional of the Year Award --Honors exceptional achievements in performance and learning by a credit union training professional or department.
  • WOW Award--Presented to the credit union with the best overall training curriculum or best training event that energizes, empowers and excites participants.
 Entries must be received by July 16 to be considered.

For more information, use the link.

CU checking accounts highlighted in iCNNMoneyi article

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NEW YORK (5/25/12)--Two credit unions topped a list of the highest-yielding checking accounts in a survey conducted by Bankrate.com.

Boeing Employees CU, Tukwila, Wash., and Consumers CU, Waukegan, Ill., finished at the top among 57 high-yield checking accounts offered by credit unions, banks and thrifts in the United States surveyed by Bankrate.com.

The results of the survey were highlighted in a CNNMoney article, "Checking accounts with the biggest payoffs."

"The Boeing Employees CU tops Bankrate's list of high-yield checking accounts. The credit union, which is open to Boeing employees and their family members as well as residents of the state of Washington, currently pays a 6.17% annual yield on its Advantage Savings and Checking Accounts," the article stated. "The next highest-earning account is Consumers CU's nationally available Free Rewards Checking account, which pays an APY of 4.09%."

Consumers CU pays its yield on deposits of up to $10,000, according to Bankrate.com. Depositors could clear more than $400 a year in interest if they maintain a balance above $10,000 and meet other account requirements.

The average high-yield checking account earns 2.05% annually, down from 2.56% last year and 3.30% in 2010, according to Bankrate's survey.

To read the article, use the link.

CUs for Kids hits 100M for CMN Hospitals

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SALT LAKE CITY (5/24/12)--Credit Unions for Kids, a collaborative effort in the credit union community to raise money for children's hospitals, announced Wednesday that it has raised more than $100 million for Children's Miracle Network Hospitals since it began its effort in 1996.

Only two other partners of Children's Miracle Network Hospitals  have achieved a fundraising level equal to that of the Credit Unions milestone. The credit union movement is currently the third-largest contributor to Children's Miracle Network Hospitals, behind only Walmart and Costco.

"2011 was a landmark year for our credit union partners," said John Lauck, president/ CEO of Children's Miracle Network Hospitals. "Their performance speaks volumes about the character of those in the movement. Given the unprecedented challenges facing the industry, credit unions could have cut back on their fundraising, but instead they pushed forward to raise $100 million.

"We congratulate Credit Unions for Kids on this achievement and thank them for enabling our hospitals to impact the lives of more kids and their families."

Credit Union National Association President/CEO Bill Cheney said of the achievement, "Reaching $100 million in contributions is an amazing milestone, but one that is perfectly in keeping with our movement's philosophy of people helping people."

He added, "Credit unions and state leagues can take great pride in their extraordinary level of support for an organization that does so much to ensure families with children in need of medical treatment are able to get the hospital care they need." 

In 2011, the Credit Union for Kids program raised $8.7 million for children's hospitals across the country.

Below are the top ten individual markets for 2011 and their fundraising levels:
  • Phoenix, Ariz., $446,895
  • Portland, Ore., $411,933
  • Tampa-St. Petersburg, Fla., $390,709
  • Washington, D.C., $381,833
  • Atlanta, Ga., $371,577
  • Los Angeles, Calif., $338,972
  • San Antonio, Texas, $310,197
  • Salt Lake City, Utah, $268,988
  • Orange County, Calif., $266,201
  • Austin, Texas, $220,074.
In 2012, credit unions have three national campaigns supporting local Children's Miracle Network Hospitals. The Change a Child's Life coin collection campaign concluded April 30. Miracle Jeans Day fundraising will occur Aug. 1-Sept. 12, and the Holiday icon campaign will run Nov. 1-Dec. 31.

System Briefs

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  • CLEVELAND (5/24/12)--The Century FCU board of directors announced Sharon Churchill became the president/CEO of Century FCU in Cleveland, effective May 21. Churchill had been the acting interim president/CEO of the $315 million-asset credit union for the past three months. She is a certified public accountant and graduate of Baldwin Wallace College. She also is a graduate of the Credit Union Executive Society CEO Institute I and II and brings her experience, which includes six years in the banking industry and over 18 years in the telecommunications industry, to this leadership role ...

Mountain West CU Association holds first annual convention

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DENVER (5/224/12)--The Mountain West Credit Union Association held its first annual convention in Colorado Springs, Colo., May 9-12, which brought out more than 400 people to participate in the convention and educational sessions, as well as to honor the associations' award recipients and newly elected board members.

The association's annual convention was themed [R]EVOLUTION to honor the changes in advancing both credit union and consumer behavior.

The Mountain West Credit Union Association is the regional trade association representing 154 member credit unions and 3.2 million credit union members throughout Arizona, Colorado and Wyoming. 

The event featured keynote speakers such as economist Donald Ratajczak, Todd Bucholz, author of Rush and New Ideas from Dead Economists, and Morton Kondracke, a journalist covering American politics and foreign policy in Washington, D.C., for more than 40 years.

The Mountain West Credit Union Association also presented two awards. The Volunteer of the Year award was presented to Jim Bender from Boulder (Colo.) Valley CU, for noble service and credit union spirit through dedication to and belief in the credit union movement. 

Also recognized was the 2012 Professional of the Year, Margaret Hunnicutt, president/CEO of Tempe (Ariz.) Schools CU. The Professional of the Year award recognizes individuals whose leadership and accomplishments have made significant contributions to their credit union, the credit union movement and the communities they serve.

Also making an appearance as part of the young professional program were a group known as Crashers. Sponsored by Cooperative Trust, CUNA Mutual, Strategic Partners and the AYIN, 12 young professionals participated in the event and attended extra mentor sessions. They were led by Mike Williams, president/CEO of Colorado CU, Litttleton, and chairman of the association board, and Jeff Russell, senior advisor at The Members Group (TMG), and Bob Hoel, who is a Filene Research Institute senior scholar and a member of the board of directors of the Mountain West Credit Union Foundation.

"The event was a great success," said Scott Earl, president/CEO of the Mountain West Credit Union Association. "It was exciting to see so many members come together to celebrate each other and so many of the year's great accomplishments."

Newly elected members of the Mountain West Credit Union association board of directors include:

  • Chairman--Mike Williams, Colorado CU, Littleton, Colo.;
  • Vice chair--Robert Ramirez, Vantage West CU, Tucson, Ariz.;
  • Secretary--Jim Yates, First Education FCU, Cheyenne, Wyo.;
  • Treasurer--Susan Frank, Desert Schools FCU, Phoenix;
  • Keith Cowling, CU of Denver;
  • Dan Desmond, TruWest CU, Tempe, Ariz.;
  • Steve Higginson, Reliant FCU, Casper, Wyo.;
  • Walt Marx, College CU of Greely (Colo.);
  • Dave Maus, Public Service CU, Denver;
  • Colleen Miller, Southwest Healthcare CU, Phoenix; and
  • Sundie Seefried, Partner Colorado CU, Arvada, Colo.
The association announced that the board of directors from the Arizona, Colorado and Wyoming Foundations, approved a proposed merger of the three state foundations. The newly merged Mountain West Credit Union Foundation is the first tri-state credit union foundation in the country.

Certified CU Executive designations awarded to 89

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MADISON, Wis. (5/24/12)--Certified Credit Union Executive (CCUE) designations were awarded to 89 individuals from 18 different states, bringing the total nationwide to 3,109, according to the Credit Union National Association (CUNA).

The CCUE designation, instituted in 1975, was created for managers and those aspiring to credit union leadership. The program teaches advanced credit union management and operations techniques. CUNA also has aligned the CCUE designation with CUNA Management School. Students now earn the designation upon graduation from the school.

For more information about CUNA Management School, use the link.

Also, six individuals earned the Certified Financial Services Professional (CFSP) designation. This program began in 1999 as a designation targeted specifically at educating credit union professionals specializing in financial services.

CUNA also awarded specialty certifications to 44 credit union professionals. These certifications require courses in a specialty area, including: compliance, lending, financial management, marketing and human resources.

Recommended for college credit by the American Council on Education, the classes and materials are tailored specifically to those working within the credit union movement. All new designations were awarded in March.

CUNA congratulates the recipients who have continued their education and training to earn designee and specialist standing.

The names and the credit unions of the new CCUE, CFSP and specialty designees are listed below. Use the link.

Tenn. CU League VolCorp honor hall of fame inductees

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CHATTANOOGA and NASHVILLE, Tenn. (5/24/12)--The Tennessee Credit Union League (TCUL) and Volunteer Corporate CU (VolCorp) recently inducted three individuals into the Tennessee Credit Union Hall of Fame at the TCUL Annual Convention and Expo in Chattanooga, Tenn.

The Tennessee Credit Union League (TCUL) and Volunteer Corporate CU (VolCorp) recently inducted three individuals into the Tennessee Credit Union Hall of Fame at the TCUL Annual Convention and Expo in Chattanooga, Tenn. Attending, from left are: Rick Veach, president/CEO Volunteer Corporate CU, Nashville; Paul C. Monk, board chairman, Clinchfield FCU, Erwin; John McKittrick, retired president/CEO, ORNL FCU, Oak Ridge; Tom Gaines, president/CEO of the Tennessee Credit Union League; and Tennessee Credit Union League Chairman Phillip Elam. (Photo provided by VolCorp)
Jointly sponsored by the TCUL and VolCorp, induction into the Tennessee Credit Union Hall of Fame is awarded annually to recognize the commitment, leadership, and dedication that deserving individuals from the state have made to the credit union movement.

The 2012 inductees into the Tennessee Credit Union Hall of Fame are:

  • John D. McKittrick, retired president/CEO, ORNL FCU, Oak Ridge;
  • Paul C. Monk, board chairman, Clinchfield FCU, Erwin; and
  • Thomas F. Gaines, III, president/CEO, Tennessee Credit Union League.
For nearly 25 years, John McKittrick has devoted his life to the principals and perpetuation of the credit union movement. McKittrick began his credit union career at Fort Campbell FCU in Kentucky. During his tenure as CEO of ORNL FCU, McKittrick's commitment to credit union principals and the financial education of ORNL employees resulted in tremendous growth under his leadership, growing from seven to 32 branches, achieving a membership level over 150,000, and an asset level of $1.35 billion.

McKittrick regularly engaged in advocating for credit union legislative efforts in Tennessee, through the state league, and nationally through the National Association of Federal Credit Unions (NAFCU) Congressional Caucus and participation in the Credit Union National Association (CUNA) Governmental Affairs Conference. His additional credit union system affiliations include memberships in the Credit Union Executives Society, NAFCU and CUNA.

Paul Monk, board chairman of Clinchfield FCU, has served on the board since 1981.His leadership as chairman for 22 years was vital in helping the credit union grow from a small $2 million "plain vanilla" credit union to a full-service $69 million credit union. As an avid community leader, Monk also served as the Chairman of the Unicoi County Board of Education and county executive for 12 years after his retirement from Clinchfield Railroad.

With over 38 years of service to the credit union system, Thomas F. Gaines has served as the president/CEO of the Tennessee Credit Union League and its three subsidiaries since 1988.  Active in national credit union affairs, Gaines most recently served as the chairman of the CUNA Examination and Supervision Subcommittee and as a member of CUNA's Corporate Credit Union Task Force. Under his leadership, the league has grown in legislative involvement and influence, working tirelessly on behalf of credit unions and Tennesseans.

He has served as spokesmen on behalf of credit unions to regulators, government officials, trade publications and the press.  During his tenure at the League, Tennessee Credit Unions have also enjoyed one of the lowest dues structures in the nation.

Mich. League ad campaign receives media coverage

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LIVONIA, Mich. (5/24/12)--The Michigan Credit Union League's cooperative advertising campaign, "Own Your Money," was featured in the May 23 edition of the Detroit Free Press.

Michigan Credit Union League President/CEO David Adams told the paper that consumers are discovering credit unions in record numbers.

"People are getting fed up with traditional banking--the fees, the long lines and the lack of trust," Adams told the Detroit Free Press.

"The new $2.5-million 'Own Your Money' campaign comes as the state's 320 credit unions added 30,000 members during the first three months of this year and 25,000 in last year's fourth quarter,"  Detroit Free Press reporter Katherine Yung wrote. "For the first time, 45% of Michiganders--or 4.5 million state residents--belong to a credit union, the highest penetration rate ever."

The campaign is now running in media markets statewide and includes TV, radio, Web ads, outdoor billboards and social media. Because of record-breaking participation from local credit unions, this year's campaign is the most aggressive yet, with ads set to run as long as 16 weeks in some markets.

The campaign includes a website  that highlights core messages associated with credit unions' lower loan rates, lower fees, superior credit card value, and 28,000 surcharge-free ATM network.

A total of 188 credit unions, representing 61% of all Michigan credit unions, voluntarily donated nearly $1 million to the campaign, and those donations were matched dollar for dollar by MCUL subsidiary CUCorp, with additional funding from MCUL, to combine for a total nearly $2.5 million spend.

For previous News Now coverage of the "Own Your Money" campaign, use the link.

Credit Union of Ohio expands financial literacy campaign

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HILLIARD, Ohio (5/24/12)--Credit Union of Ohio presented "Real Money, Real World," a financial literacy program, to nearly 1,200 eighth graders in Hilliard, Ohio earlier this month--an indication of how the program has grown since its inauguration two years ago, the credit union said.

Credit Union of Ohio presented "Real Money, Real World," a financial literacy program, to nearly 1,200 eighth graders in Hilliard, Ohio, earlier this month.  (Photo provided by Credit Union of Ohio)
Since initiating the program in 2010, Credit Union of Ohio, with $130 million in assets, has expanded the reach of "Real Money, Real World" into two additional Hilliard middle schools. The credit union plans to continue that growth during the next school year.

The final simulation of the game provides students the opportunity to map out what their financial future would be at the age of 25, according to a scenario packet they each receive. The packet determines their occupation, income and credit history.

The program helps students understand the realities of managing real finances. They learn how credit cards work, how to create a budget and how far that budget will stretch in today's economy. The students also are shown the importance of saving, and how their education may impact their future earnings.

Maine CUs honored at annual meeting

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PORTLAND, Maine (5/24/12)--Eight Maine credit unions were 2012 recipients of the Dora Maxwell Social Responsibility Community Service, Louise Herring Philosophy-In-Action Member Service, and the Desjardins Youth and Adult Financial Education Awards at the Maine Credit Union League's Annual Meeting and Convention. 

Eight Maine credit unions were 2012 recipients of the Dora Maxwell Social Responsibility Community Service, Louise Herring Philosophy-In-Action Member Service, and the Desjardins Youth and Adult Financial Education Awards at the Maine Credit Union League's Annual Meeting and Convention. Kerry Wood, left, president/CEO of Community CU, Lewiston, picked up four awards for her credit union including a first-place Louise Herring, first place Desjardins Youth and Adult Financial Education Awards, and a second-place Dora Maxwell.  She is pictured here with Richard Dupuis, Maine Credit Union League board member.
The state awards are part of a national awards program coordinated by the Credit Union National Association. The winners in each asset category will compete in the national awards program in the fall. A Maine credit union has received a first or second place award in the national competition in nine out of the past thirteen years.  In 2011, three Maine credit unions received a five national awards.

Professionals from the Maine Public Relations Council and Maine Businesses for Social Responsibility judged the awards, which honor credit unions for efforts and outreach that help the community and/or members. 

Evelyn Desmond, right, a board member at Five County CU, Bath, Maine, accepts her credit union's three awards--a first-place Dora Maxwell, a second-place Louise Herring, and an honorable mention Desjardins Youth Financial Education Award.  She is pictured with Richard Dupuis, Maine Credit Union League board member and the president/CEO of Five County CU.
Maine credit unions raised nearly $1.5 million in fundraising for various causes including $447,000 for the Maine Credit Unions' Campaign for Ending Hunger, $75,000 for Maine Special Olympics, $50,000 for the Children's Miracle Network, $75,000 for the Maine Children's Cancer Program and many more.

Maine credit unions also volunteered more than 35,000 hours for community organizations and activities across Maine.

"Credit unions are involved in their communities not because they have to but because it is the right thing to do and is part of the credit union philosophy of 'people helping people,'" said John Murphy, president of the Maine Credit Union League. "The level of commitment and dedication to people and their communities by Maine's credit unions is significant."

Central Maine FCU received three awards--a first-place Dora Maxwell, a first-place Louise Herring, and a second-place Desjardins Youth Financial Education Award at the Maine Credit Union League's Annual Meeting and Convention. President/CEO Vicki Stuart, left, accepts them from Richard Dupuis, Maine Credit Union League board member. (Photos provided by Maine Credit Union League)
The 2012 recipients of the Dora Maxwell Social Responsibility Community Service Award are:

  • Great Falls FCU, Lewiston, first place, assets of $20 million-50 million;
  • Community CU, second place, assets of less $20 million-$50 million;
  • Central Maine FCU,  Lewiston, first place, assets of $50-100 million;
  • Five County CU, Bath, first place, assets of $100 million-$200 million; and
  • Midcoast FCU, Bath, second place, assets of $100 million-$200 million.  
 The 2012 recipients of the Louise Herring Philosophy-In-Action Member Service Award are:

  • Community CU, first place, Lewiston, assets of less than $50 million;
  • Central Maine FCU, first place, assets of $50 million-$250 million; and
  • Five County CU, second place, assets of $50 million-$250 million.
 The 2012 recipients of the Desjardins Youth and Adult Financial Education Awards are:

Youth
  • Community CU, first place, assets less than $50 million; and
  • Acadia Federal CU, Fort Kent, first place, assets of $50 million-$250 million.
Adult
  • Community CU, first place, assets less than $50 million.

REALTORS FCU members approve merger with Northwest FCU

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ROCKVILLE, MD and HERNDON, Va. (5/23/12)--REALTORS  FCU, Rockville, Md., members have approved a merger with $2.1 billion Northwest FCU, Herndon, Va. 

Martin Edwards, REALTORS FCU board chairman, told News Now it would have taken REALTORS FCU another five to seven years to provide its members the level of services that Northwest FCU offers its membership. Among those services is Northwest FCU's membership in the Shared Branch Network.

REALTORS FCU, with $75 million in assets, was chartered as a virtual credit union 2009 to serve the National Association of REALTORS. The association's members approved the merger at its annual meeting over the weekend.

The partnership of the two institutions is expected to close within the next 90 days. After the merger is completed, REALTORS FCU will continue to serve its current membership base under the brand, REALTORS FCU, a division of Northwest FCU. 

"REALTORS FCU was formed with one goal in mind, to provide the members of the National Association of Realtors with the most comprehensive menu of banking services possible, while providing the highest quality of personalized attention in the marketplace, all through our 'virtual' credit union," said Edwards. "Since the inception of the organization, we have been an innovator and are proud to have had the opportunity to forge a new path."

"The National Association (of Realtors) has more than a million members nationwide," Edwards told News Now. "This partnership provides our members with more options and I think it provides Northwest FCU with opportunities for membership growth."

"We view our partnership with REALTORS FCU as win-win opportunity for our two organizations and our members," Tom Conroy, Northwest FCU board chairman, said.

Conroy added, "With a potential field of membership of over a million members strong, we believe this merger presents excellent growth opportunities for the combined organization--not only from a membership perspective but from a business lending perspective.

"We have the infrastructure, expertise and financial strength to provide REALTORS FCU members with a wider range of business and mortgage loans."

Maine league raised 447k in 2011 to fight hunger

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PORTLAND, Maine (5/23/12)--The Maine Credit Unions' Campaign for Ending Hunger, which raised a record-setting $447,000 in 2011, distributed some of those funds Friday by making a donation to each of the state's Agencies On Aging Meals On Wheels Programs in honor of National Older Americans Month, said the Maine Credit Union League.

The Maine Credit Unions' Campaign for Ending Hunger, which raised a record-setting $447,000 in 2011 and has raised more than $4.3 million since it began in 1990, made a contribution in honor of Older Americans Month to Maine's five Agencies on Aging Meals on Wheels Programs. From left, at the Maine Association of Area Agencies on Aging in Hallowell are: Betsy Sawyer-Manter of Seniors Plus, Jon Paradise of the Maine Credit Union League, Julie Sexton of Spectrum Generations, and John Nale, board chair of the Maine Association Area Agencies on Aging.  (Photo provided by the Maine Credit Union League)
The campaign presented $1,500 to the five agencies that serve meals to Maine's older population through the program at its state headquarters at the William S. Cohen Community Center in Hallowell.  

Meals on Wheels Programs receiving contributions were:

  • The Aroostook Area Agency on Aging, which serves all of Aroostook County;
  • The Eastern Maine Agency on Aging, which serves Hancock, Penobscot, Piscataquis and Washington Counties;
  • The Eastern Maine Agency on Aging, which serves Hancock, Penobscot, Piscataquis and Washington Counties;
  • Seniors Plus, which serves Androscoggin, Franklin and Oxford Counties;
  • The Southern Maine Agency on Aging, which serves Cumberland and York Counties; and
  • Spectrum Generations, which serves Kennebec, Knox, Lincoln, Sagadahoc, Somerset and Waldo Counties.
In the latest rankings of senior food insecurity by the U.S. Department of Agriculture, Maine had the highest percentage of senior food insecurity in New England, and the 17th highest in the country. Currently, 6% of Maine's senior population are food insecure.

"This donation helps meet a need that is not felt just this month, but throughout the year," said Jon Paradise, governmental and public affairs manager for the Maine league. "Our seniors have contributed greatly to this state and making sure they have enough to eat is the right thing to do. For many seniors, the Meals on Wheels Programs not only provide much-needed meals but also provide important human interaction, especially to those seniors who live alone. In addition to making a monetary contribution, Maine's credit unions also hope to build awareness of the issue of senior hunger in Maine."

John Nale, board chair of the Maine Association of Area Agencies on Aging, expressed his appreciation for the generosity of Maine's credit unions. "Meals on Wheels is a vital program for our seniors, so this contribution will make a big difference," he said. "I applaud the success and commitment of Maine's credit unions in raising funds for ending hunger. Thank you for thinking of older Mainers who can sometimes be forgotten when the issue of hunger is mentioned."

Each year, nearly all of Maine's credit unions participate in the Maine Credit Unions' Campaign for Ending Hunger. Since 1990, when this collective effort began, Maine's credit unions have raised and distributed more than $4.3 million to help end hunger in Maine. And 100% of all funds raised stays in Maine and goes directly to ending hunger.

Montana high school students join CU board

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WHITEFISH, Mont. (5/23/12)--Although homework and hall passes still are daily concerns, seven Whitefish High School (WHS) students may have just become the most influential teenagers in northwest Montana by becoming members of the Whitefish (Mont.) CU (WCU) board.

The students, four seniors and three juniors, were recently hand selected by WHS from among 232 of their peers to become the first members of WCU inaugural junior board of directors. Their duties as junior board members will include conducting their own board meetings, writing articles for WCU's newsletter and implementing a community service project, said Sue Schenck, the $1.22 billion-asset credit union's business development director.

"One of the really important functions of a credit union, and also part of the credit union philosophy, is financial education," Schenck said. "This is a great way to get the credit union philosophy out there and hopefully have some fun with these students while we're doing it."

During their monthly meetings, the students also will spend time learning about the 77-year history of WCU and its place in the communities of northwestern Montana. Guest speakers will teach junior board members the grassroots movement that brought about credit unions in the United States and about basic credit union philosophies.

Hailey Vasquez a senior, is president of the Honor Society at WHS. She serves as chairperson of the junior board, and says she's excited to work with WCU and learn more about the inner workings of a credit union.

"I knew very little about WCU before I joined this program," said Vasquez. "I was definitely surprised by its size and the depth of its workings. It's very impressive for such a small town."

Junior board member Joseph Perry is also a WHS senior and the school's student body president. He's kept a 4.0 grade point average throughout high school and hopes one day to have a career working with lasers. Perry says he's already learned a number of new things about the credit union.

"Before being on the junior board of directors, WCU was just the place where my money stayed," explained Perry. "Now, WCU has a face and is more personal. I have begun to learn what makes WCU tick, what makes it special, and how we can help it grow."

Also serving on WCU's junior board are seniors Ally Pickeral and Abby Wagner, the board's vice chair. Whitefish High School's junior class is represented by Kelsey McFeely, Perrey Sobba, board secretary, and Rachelle Brown. The junior board of directors will continue meeting monthly until the end of the school year.

Schenck said she and WCU "expect great things this year from these amazing students," and plan to continue the program again with another group of high schoolers in January.

CUNA Mutual accepting Excellence in Lending entries

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MADISON, Wis. (5/23/12)--CUNA Mutual Group and the CUNA Lending Council are accepting entries for the 13th annual Excellence in Lending Awards, which recognize outstanding lending results and practices by credit unions. The deadline for submitting applications is Aug. 17.

The Excellence in Lending Awards identify and share examples of lending excellence within the credit union movement by recognizing individual credit unions for their ability to serve members while sustaining sound financial performance. Credit unions demonstrating an ability to meet their members' needs through innovation are excellent award candidates.

"Excellence in Lending recognition is one of the highest compliments a credit union can receive in our industry," said Dan Murray, vice president, lending services, at CUNA Mutual. "Being selected as the industry's best also provides a great opportunity for credit unions to promote their award-winning lending success locally to potential members."

CUNA Mutual and the CUNA Lending Council established the Excellence in Lending Awards in 2000.

Credit unions may be nominated for the 2012 award in the following categories:

  • Consumer Lending--Assets less than $250 million, and assets more than $250 million;
  • Mortgage Lending--Assets less than $250 million, and assets more than $250 million;
  • Low/Modest Means--Any asset level; and
  • Business Lending--Any asset level.
 

Applications and more information regarding the awards are available. Use the link.

Sponsored by CUNA Mutual and the CUNA Lending Council, the Excellence in Lending Awards will be presented at the CUNA Lending Council's Annual Conference, Nov. 4-7 in Miami Beach. Airfare, hotel and conference registration for one representative of each of the winning credit unions is included with the award.

The CUNA Lending Council is a community of credit union lending professionals dedicated to being the primary source of best lending practices and educational opportunities for the credit union industry.

Keynote speaker for CUNA FUSE announced

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MADISON, Wis. (5/23/12)--Lee Silber, bestselling author of "The Wild Idea Club," will be the opening keynote speaker at CUNA FUSE--Branch Operations and Business Development School, July 30-Aug. 2 at the Four Seasons in Las Vegas, the Credit Union National Association announced. 

Silber, a former surf shop owner who developed a collaborative system for improving workplace performance, will show credit union branch managers and business development professionals how to motivate their staff by finding ways to accommodate their talents and help them get the most out of their careers.

With talents recognized, Lee argues, each staff member will form a passion for the credit union movement and strive to make their local credit union stronger by finding the most efficient ways to operate.

The CUNA FUSE--Branch Operations and Business Development School allows credit union branch managers and business development professionals to network with other professionals and explore techniques to blend duties at their credit union. This conference will examine traditional barriers between these two departments and discuss possible solutions to blend responsibilities and maximize efficiencies that encourage growth in credit unions.

Topics include:

  • Branch management;
  • Business development and retention; and
  • Leadership and staff development.
Attendees will also have the chance to network with credit union professionals outside of their area of expertise and collaborate to discover new solutions. The flexible format of the school allows attendees to pick and choose which sessions to attend, encouraging business development and branch management professionals to step outside of their traditional mode of thinking and discover new ways to operate.

Maps CU illustrates real-life need for supplemental capital

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SALEM, Ore. (5/23/12)--Maps CU, Salem, Ore., provides a real-life example of how supplemental capital limits threatens the ability of credit unions to serve their memberships.

Under current law, a credit union's net worth ratio is determined solely on the basis of retained earnings as a percentage of total assets. As a consequence, a credit union that is successful in serving its members and attracting new shares runs the risk of diluting its regulatory capital ratio, triggering non-discretionary capital-based supervisory actions under prompt corrective action (PCA) rules.

"The most pressing concern for us is we continue to add new members and deposits to the credit union, and it continues to strain our net worth ratio," said Kevin Cole, chief financial officer for Maps Credit Union, told Northwest Credit Union Assocation (Anthem May 15).

Maps CU and other healthy credit unions may be forced to turn away deposits and to restrict lending to satisfy rigid regulatory capital requirements, Cole said.

The Salem, Ore.-based Maps serves 42,000 members and is currently able to offer highly desired services, including consumer loans, mortgage loans, deposit accounts, insurance, financial planning and business loans.

Consumers have found the $417 million state chartered financial institution so attractive that its average growth between 2001 and 2011 was 8.76%. Yet while new members were joining, the corporate credit union losses and share insurance assessments also took a toll.

Maps CU is a leader in support of a bill that would provide relief to credit unions being hamstrung by the current law. H.R. 3993, "Capital Access for Small Business and Jobs Act," was introduced Feb. 9, 2011, by U.S. Reps. Peter King (R-N.Y.) and Brad Sherman (D-Calif.).

"In 2010 and 2011, management has had to work aggressively to constrain asset growth," Maps stated in a position statement it shared with congressional leaders. "We have reduced deposit rates significantly and have shifted marketing resources to loan products. This has resulted in less value delivered to Maps members, and has perhaps discouraged potential members from joining, at a time when many people clearly see value in a Maps relationship."

In February, Maps CU added more new members and opened more new checking accounts than during any previous month in its 76-year history. "Absent the ability to raise supplemental capital, we feel we may be faced with the prospect of turning new members away," Cole said.

Supplemental capital will be one of the priorities next month when a delegation of Northwest credit union supporters travels to Washington, D.C.

"Garnering support from the Northwest delegation for H.R. 3993 will be one of the primary focuses of the June 'Hike the Hill' trip," said Jennifer Wager, vice president of legislative advocacy for the NWCUA. "Credit unions need this common-sense regulatory relief to allow them to continue to provide a full array of services to their membership and stimulate their local economies."

The Credit Union National Association supports H.R. 3993, which would allow credit unions to strengthen their ability to manage risks through the use of supplemental capital.

CU System brief (05/21/2012)

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  • MADISON, Wis. (5/22/12)--CORRECTION: In an article Friday, News Now incorrectly stated the status of former Western Corporate FCU exec Todd Lane in a lawsuit brought by the National Credit Union Administration (NCUA) against five members of senior management at WesCorp. Lane has not agreed to a settlement in the NCUA's lawsuit over mortgage backed security losses that WesCorp experienced before its collapse. A representative for Lane told News Now Monday that the former chief financial officer of WesCorp will continue to defend the action. News Now regrets the error.  …

N.J. league discusses CU difference on IEbru TVI

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HIGHTSTOWN, N.J. (5/22/12)--Speaking about the differences between banks and credit unions and the benefits of joining a credit union, New Jersey Credit Union League President/CEO Paul Gentile last week was a guest on Ebru Today, a national television news show.

"All of the money [at credit unions] goes for the lending and savings needs of the membership," Gentile said on the show. "So you can be assured your money is not being put out in credit derivative swaps or big Wall Street-type transactions. It's just for [the member] for lending and savings needs."

However, credit union members can get the same consumer products and services they get at banks such as credit cards, car loans, mortgage loans and certificates of deposit, Gentile added.

Also, the fee structure at credit unions is much lower than at banks, Gentile said.

A lot of people mistakenly think they cannot be a part of a credit union, he said. Although credit unions have roots with employers, they have expanded over the years to include other groups.

By going to SmarterChoice.org, the Credit Union National Association's consumer website, people can answer three questions about where they live, work and worship to find a credit union in their area are that they can join, Gentile said.

Also, because credit unions have a shared branching network, members can have access to more than 23,000 ATMs nationwide, with absolutely no surcharge fees, he said.

To view the video, use the link.

CUANY report N.Y. CUs outreach makes difference

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ALBANY, N.Y. (5/22/12)--The Credit Union Association of New York released its 2011 MORE (Member Outreach and Reinvestment Endeavor) Report--an annual compilation of New York credit unions' outreach efforts that indicates credit unions make a difference in their communities.

New York Credit unions conducted outreach efforts in areas such as adult financial education, community investment and outreach, customized products and services, financial counseling, immigrant outreach, Volunteer Income Tax Assistance and youth financial education.

"The information showcased in the 2011 MORE Report is inspiring," said William J. Mellin, association president/CEO. "Whether they are serving rural communities or New York City neighborhoods, this report shows how New York's credit unions are making a profound difference in every corner of the state."

This year's edition features more than 1,500 entries from 80 credit unions representing all 14 association chapters.

The MORE Report was shared with lawmakers during the association's Governmental Affairs Conference to offer tangible evidence of how credit unions are fulfilling their mission. The report also was shared with other credit unions and state associations/leagues.

Some of the stories documented in the 2011 MORE Report are:

  • Boulevard FCU, Amherst, presented basic money management workshops for refugees in English Second Language classes.
  • Bethex FCU, Bronx, supervised a 12-week course called Money Smart for Adults, which was provided to hearing-impaired individuals. With the help of an instructor proficient in sign language, eight permanently hearing-impaired students completed all 12 modules within the curriculum, and at least 15 individuals completed at least one module.
  • SeaComm FCU, Massena, partnered with the Akwesasne Housing Authority, OneWorkSource in Malone and the St. Lawrence County Cooperative Extension to host two "Super Saturday" tax events. Internal Revenue Service-trained volunteers prepared tax returns for low- and moderate-income workers.
  • ACMG FCU and Cooperative Federal CU, Syracuse, collaborated to host a Mad City Money event at Solvay High School.
  • Staff at SUNY Geneseo (N.Y.) FCU worked one-on-one with members to help them consolidate debt and learn about budgeting.
  • Southern Chautauqua FCU, Lakewood, in response to the lack of public transportation in the area, partnered with a local non-profit organization to write auto loans for people of modest means. The loans were not designed to make profits for the credit union, but to help people in the community have adequate transportation.
Also included in the report are the results from the 2011 MORE Survey. A sampling of the results include:

  • More than 70% of New York's credit unions offered customized products for youth;
  • More than 70%  of New York's credit unions sponsored community events;
  • 32% of New York credit unions offered their own VITA programs;
  • New York credit unions held more than 2,500 youth financial education sessions in schools statewide;
  • 32% of New York's credit unions worked with other community groups to provide financial or home ownership counseling; and
  • New York credit union staff contributed more than 12,000 volunteer hours to community organizations in 2011.

Filene report explores member service organizational efficiency

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MADISON, Wis. (5/22/12)--A new report from the Filene Research Institute questions the cost-effectiveness of credit union's traditional commitment to face-to-face service in the age of low-cost delivery channels.

"Balancing Member Service with Organization Efficiency" does not make the case that credit unions should turn members away, raise fees or diminish member value. Rather, it advises that, as cooperatives, credit unions "should constantly strive to minimize operating expenses in order to return more economic value" to members.

That means measuring account maintenance costs, including core system costs, transaction costs and the cost of staff downtimes. Tracking is the first step toward improvement, according to the report.

The report was authored by Joseph Prunty, CEO of CorePROFIT Solutions, a cost development and customer profitability measurement and management company.

A four-year analysis of member income contributions among 95 credit unions shows that 20% of members are responsible for 150% of net income. This means that the other 80% at some level eroded net income. A large part of that erosion comes from the cost of providing in-person service.

Members are often not willing to pay for services that have traditionally been free, so it is more realistic to push members toward lower-cost delivery channels such as online banking and e-statements.

The full report contains cost-of-serve benchmark numbers that can serve as a starting point for credit unions that have not started their own cost accounting.

CUs in Missouri and Malawi meet share cooperative ideals

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ST. LOUIS (5/22/12)--Six representatives from the Malawi Union of Savings & Credit Co-operatives Ltd. (MUSCCO) earlier this month traveled 8,600 miles to meet with their global peers at the Missouri Credit Union Association (MCUA) in pursuit of providing better service to their credit union members.

Mike Beall, president/CEO of the Missouri Credit Union Association (center), welcomes delegates from Malawi, including,  from left, Albert Moyo, Mzimba Teacher's Savings and Credit Cooperative (SACCO); Charles Nyekanyeka, Bvumbwe Community SACCO; Sylvester Kadzola, Malawi Union of Savings & Credit Co-operatives Ltd. (MUSCCO); Beall; Faith Manganda, MUSCCO; Brian Chyuse, Fodya SACCO LTD and Itai Msiska, Karonga Teachers SACCO. (Photo provided by the World Council of Credit Unions)
As a first step toward a partnership fostered by the World Council of Credit Unions (WOCCU), MCUA hosted the group from (SACCOs), or credit unions, with the hope of gaining greater knowledge of each other's credit union systems.

The goal of the May 5-16 visit was to establish education and networking opportunities between MCUA and MUSCCO, soon to be one of 18 relationships managed by WOCCU's International Partnerships Program. The program's purpose is to foster the sharing of information and technology between state and national organizations and their counterparts in developing countries for the economic well-being of credit union members worldwide, according to Brian Branch, WOCCU president/CEO.

"We very much appreciate MCUA's participation in the International Partnerships Program and their role in hosting the MUSCCO delegation," Branch said. "The two organizations have a great deal of information to share for the mutual benefit and development of more comprehensive and effective member services."

The visitors, led by WOCCU Director Sylvester Kadzola, CEO of MUSCCO, represented five credit unions from three districts in Malawi. During their stay, group members participated in Missouri's state credit union foundation conference, visited local credit union branches, were recognized by the Missouri General Assembly in Jefferson City, and traveled to Washington, D.C., for a Credit Union National Association briefing and a meeting with the National Credit Union Administration.

"It's astonishing how two leagues serving different countries and continents can mutually assist each other by sharing philosophies, best practices and ideas," said Mike Beall, MCUA president/CEO. "We are proud to share a partnership with our friends in Malawi to strengthen the international spirit of cooperation."

When asked what they will take back from their experience with MCUA, the Malawians cited as key learning outcomes fostering collaboration among credit unions to realize economies of scale, standardizing reporting techniques, sharing back-end analysis on quarterly reports and implementing financial literacy programs to better educate members on credit union products and services. The visit constituted the inaugural meeting of the two partnering organizations. A delegation from Missouri and World Council will travel to Malawi in early 2013 to sign the partnership agreement make the partnership official.

"The visit has been truly inspirational and educational, and the delegation from Malawi is going back with renewed confidence and optimism of the enormous benefits that will accrue to the Malawi SACCO movement from this partnership," says Kadzola. "We see tremendous growth and financial services diversification and sophistication ahead of us as a result of this partnership."

Iowa CU league receives NCBs Spirit of Cooperation award

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WASHINGTON, D.C. (5/22/12)--The Iowa Credit Union League (ICUL) has received the 2012 Stan Dreyer Spirit of Cooperation Award, which recognizes those who live and work with the spirit of the cooperative principles, presented by National Cooperative Bank (NCB).

The award was accepted on behalf of ICUL by Sara Flynn and Mike Powers of The Members Group (TMG), a subsidiary of ICUL. The official presentation took place during the bank's annual meeting May 3 in Washington D.C.

"We are pleased for the first time to present the Spirit of Cooperation award to a group of cooperatives--highlighting the sixth cooperative principle--cooperation among cooperatives," said Charles E. Snyder, NCB president/CEO. "The ICUL is a shining example of the strength of cooperation among organizations, and during the International Year of Cooperatives, it seemed very fitting to honor them with this award."

As corporate credit unions across the country faced challenges during the past several years, ICUL approached NCB to provide correspondent services.

The collaboration between ICUL and NCB further highlights the mission of the 2012 International Year of Cooperatives, the United Nations declaration and global campaign to educate the public about the benefits of cooperatives.

"We are honored to have received the 2012 Stan Dreyer Spirit of Cooperation Award," Flynn said. "We are so thankful that our collaborative partnership with NCB has provided great value to our Iowa credit unions for their correspondent banking needs."

Stan Dreyer, who is now retired from NCB, was one of the people instrumental in the passage of the 1978 Congressional Bank Act, which created NCB. The award is bestowed annually on an NCB employee or member-customer whose devotion and contribution to the cooperative community emulate those embodied by Dreyer.

Desjardins state lawmaker award presented to Pa. legislator

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HARRISBURG, Pa. (5/22/12)--Pennsylvania State Rep. Mark Longietti was presented with the Credit Union National Association's Desjardins Financial Literacy Award for State Lawmakers at the Pennsylvania Credit Union Association's (PCUA) Annual Convention & Exposition in Pittsburgh.

Pennsylvania State Rep. Mark Longietti was presented with the Credit Union National Association's Desjardins Financial Literacy Award for State Lawmakers at the Pennsylvania Credit Union Association's (PCUA) Annual Convention & Exposition in Pittsburgh. (Photo provided by CUNA)
The national award honors one state lawmaker annually for leadership on behalf of youth financial literacy. In bestowing the award, Jim McCormack, PCUA president/CEO, acknowledged Rep. Longietti's efforts to establish financial education programs statewide. 

Longietti accepted the award in a video presentation shown to the convention attendees.

"While I am honored to receive an award for advancing financial education, the people who truly deserve credit are the credit union volunteers and professionals who work one-on-one with credit union members," Longietti said.

Rep. Longietti sponsored the State House education bill that helps Pennsylvania's educational system incorporate financial education in school systems. Following a veto by the governor, Longietti gained bi-partisan support to overturn the veto by displaying the need for financial education. The bill was passed on Nov. 17, 2010, and officially became Act 104.  

Act 104 requires the Pennsylvania Department of Education to convene an Economic Education and Personal Financial Literacy Task Force to assess the trends and needs of economic education and personal financial literacy; consider how funds are used to support economic education and personal financial literacy; and make recommendations to the governor and the general assembly regarding legislative or regulatory changes to improve economic education and personal financial literacy.  PCUA serves on the Economic Education Task Force.

April Singleton of the Lan-Chester Chapter and Citadel FCU was named the PCUA's 2012 Credit Union Youth Ambassador of Pennsylvania.

Winners of the Desjardins, Dora Maxwell and Louise Herring Awards and the Communications Awards for annual report, newsletter, and website were also honored by the PCUA.

Winners included:

Desjardins Youth Financial Literacy

P & G Mehoopany Employees FCU, Tunkhannock, $50-$150 million in assets;

Service 1st FCU, Danville, $150-$500 million; and

TruMark FCU, Trevose, more than $500 million.

Desjardins Adult Financial Literacy

HealthCare First CU, Johnstown, $50-$150 million.

Dora Maxwell Award for Social Responsibility

PALCO FCU, Muncy, $50-$150 million;

Cross Valley FCU, Wilkes Barre, $100-$200 million;

Merck Sharp & Dohme FCU, Chalfont, $200-$500 million;

Clearview FCU, Moon Township, $500 million-$1 billion;

American Heritage FCU; Philadelphia, more than $1 billion; and

Chapter--Pittsburgh Chapter.

Louise Herring Award for Philosophy in Action

Timberland FCU, Dubois, $50-$250 Million;

TruMark Financial CU, more than $1 billion; and

Chapter--Erie Chapter.

Credit Union Communications Awards

Annual Report

Keystone United Methodist FCU, Cranberry Township, less than $20 million;

HealthCare First CU, $20-$100 million;

TruMark Financial CU, more than $100 million.

Newsletters

North Penn FCU, Colmar, less than $20 million;

Honorable mention--Keystone United Methodist FCU

CTCE FCU,  Reading, $20-$100 million; and

Service 1st FCU, more than $100 million.

Website

Keystone United Methodist FCU, less than $20 million;

Mountain Laurel FCU; St. Mary's, $20-$100 million; and

TruMark Financial CU, more than $100 million.

CU System briefs (05/18/2012)

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  • FORT WORTH, Texas (5/21/12)--A serial robbery suspect was indicted Wednesday for a September robbery of a credit union in Mansfield, Texas, but he is still at large. Jesus Alberto Esquivel, 29, had allegedly told a special agent at the Federal Bureau of Investigation during a phone call that he would turn himself in. Instead, he stalled and fled to Mexico, said the indictment papers (The Fort Worth Star-Telegram May 17). Court documents indicated that Esquivel allegedly robbed four credit unions and banks and attempted to rob a fifth financial institution between Sept. 2 and Oct. 21. The robberies occurred in Mansfield Fort Worth, Arlington, Plano and Denton. Each time the robber presented a teller with a note demanding money and threatened that he had a gun …
  • EUGENE, Ore. (5/21/12)--Lane County, Ore., credit unions beat their two-year Credit Unions for Kids goal of $150,000 for raising funds for Children's Miracle Network Hospitals. They completed the goal in one and a half years. They built two NeoNatal Intensive Care Unit rooms and added an identifying plaque to an upgraded waiting area at Sacred Heart Pediatric Medical Center in Eugene, Ore. "Their passion and ongoing support has allowed us to make a significant impact in the lives of children that we treat, and the completion of their $150,000 pledge this year continues to provide our caregivers with the tools they need to save lives," said Alexa Sharp, Children's Miracle Network Hospitals director at Sacred Heart …
  • SUPERIOR, Wis. (5/21/12)--Fran James, CEO of Metro CU in Superior, Wis., has announced her retirement, effective at the end of May. She has been CEO since June 2011. Before that, James was the $30 million asset credit union's vice president of lending. She arrived at Metro CU from First Superior Credit Union Center, where she served as manager for 17 years (Superior Telegram May 18) …
  • HARRISBURG, Pa. (5/21/12)--Dave Baker, CEO of York (Pa.) Education FCU, will retire after more than 40 years on June 1, according to the Pennsylvania Credit Union Association (PCUA) Life is a Highway May 18). At PCUA's annual meeting, which began Sunday and continues through Tuesday, Baker will be presented with the Lifetime Achievement Award for the 2012 William W. Pratt Professional of the Year. The award will be presented at the association's closing banquet Tuesday. York Educational Board Chairman Joe Dilling announced the credit union will offer a new scholarship in Baker's honor …

League chides banks attack on CUs 1Q success

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PEWAUKEE, Wis. (5/21/12)--The Wisconsin Credit Union League chided the Wisconsin Banking Association (WBA) in a press release Thursday for attacking state-chartered credit unions' first quarter 2012 success reported by state regulators.

"So which is it? WBA takes issues with credit unions' competence and stability in a tough economy at the same time it argues credit unions aren't competent enough to lend more money to small businesses," said league President/CEO Brett Thompson.

Earlier this month, the Wisconsin Department of Financial Institutions reported that Wisconsin's state-chartered credit unions showed increases in net income, total assets and return on assets during the first quarter (News Now May 11).

Credit unions' demonstrated competence represents a challenge to the WBA as it continues to fight the bipartisan S. 2231, the Small Business Jobs Act, in Congress, said the league. The bill would lift credit unions' member business lending (MBL) cap to 27.5% of assets from 12.25%. The Credit Union National Association estimates that lifting the cap would add $13 billion in new credit for small businesses as well as create 140,000 jobs nationally, without costing the taxpayer.

"This jobs bill is essential to small businesses; close to 90% of them have cited credit access problems in recent years," said the league.

A chief talking point banks make against the jobs bill is that credit unions are not competent enough to provide small business lending, said the league, "even though nationally over the last 15 years credit union business loan loss rates have averaged 0.23%, compared to 0.91% for banks. Wisconsin credit unions' business loan loss rate has also been below that of banks for more than a decade."

The facts are clear, said Thompson. "Credit unions are successful at their real mission: serving all of their members--consumers and businesses--regardless of income. The first quarter figures demonstrate that credit unions have done well by meeting economic needs in Wisconsin communities. It's time to pass the jobs bill and let them do more," he said.

Catalyst transition doubles check processing volume

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PLANO, Texas (5/21/12)--Catalyst Corporate FCU's transition of services for hundreds of credit unions that were formerly served by Western Bridge Corporate FCU has resulted in nearly doubling Catalyst's daily check processing volume.

In May, it averaged more than 800,000 items a day, up from 420,000 items per day, and one day the Plano, Texas-based corporate credit union processed more than one million checks.

The corporate met several transition milestones this month, including the transition of check processing, international item processing and remote deposit services.

"We were aiming for a seamless transition and we got very, very close," said Brad Ganey, Catalyst Corporate's chief operating officer.

In the past several weeks, staff assisted 385 credit unions in converting their check processing and an additional 212 in transitioning their remote deposit services. "We would have liked to have had 18 months to pull off this transition, but instead, we had just four," Ganey said.

Staff provided training to more than 1,000 participants via webinars. "Because of the tight timeline and the number of converting credit unions, we fully anticipated a large volume of calls and questions on the days of the major conversions," Ganey said. Catalyst activated a telephone call center that was to be dedicated exclusively to assisting members who remained on hold for longer than three minutes.

But the contingency was not needed during the checking conversion. The average hold time was seven seconds on the day that the check processing converted, and no caller was on hold for more than two-and-a-half minutes, he reported. Catalyst staff handled 536 calls that day.

Other services have been transitioned in recent weeks.  From May 1-11, Western Bridge member credit unions, holding nearly 4,000 securities, were moved onto Catalyst's new safekeeping system. Advance communications and training prepared credit unions--52 of the 81 transitioning credit unions attended Catalyst's webinars.

Kathy Garner, Catalyst Corporate president/CEO noted the critical transitions "have gone smoothly. Not only is this aggregation beneficial for the Western Bridge members who were impacted directly, but it also represents the fulfillment of a promise that Catalyst made to continue to pursue opportunities for growth that will result in bottom line impact for the organization and its members."

The corporate's capitalizing membership stood at 1,224 by mid-May and includes more than 300 credit unions that previously were members of Western Bridge.

More product and service deadlines are scheduled in the weeks leading up to the final July 2 consolidation.

Bank associations file amicus brief back mortgage recording tax

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ALBANY, N.Y. (5/21/12)--The American Bankers Association (ABA) and the New York Bankers Association (NYBA) have filed an amicus brief in Hudson Valley FCU's legal challenge against New York state's mortgage recording tax (MRT). The banking associations argue that federal credit unions should not be exempt from paying the state tax.

The banking associations, in seeking leave to file the brief in the Court of Appeals of the State of New York, the state's highest court, said their brief would "highlight the unwarranted competitive advantage that federally chartered credit unions stand to gain" if the $3.2 billion asset, Poughkeepsie, N.Y.-based Hudson Valley FCU succeeds in its argument "that such credit unions and their members are exempt from paying the New York mortgage recording tax at issue in this appeal."

Hudson Valley, in its suit, argued that the Federal Credit Union Act (FCUA) exempts federally chartered credit unions from the state tax, which it argues is not a "privilege tax" under federal law. Instead, the federal tax exemption and applicable U.S. Supreme court rulings should control the issue, it said.

The banking associations' argument is three fold:

1. The credit union is seeking a novel interpretation of the FCUA to obtain a competitive business advantage over other financial institution lenders, including state credit unions, in New York. Here, the banks challenge a Supremacy Clause argument, saying FCUA "clearly does not grant an exemption for taxes paid by borrowers; the statute expressly exempts only taxes paid on property or income of the credit union itself. The brief also noted, "Congress has never amended the FCUA to state that taxes paid by credit union members or taxes paid for the privilege of recording mortgages should be exempt from taxation."

2. There is no statutory basis for the tax immunity sought by the credit union. The brief noted: "FCUA makes it clear that it does not grant tax immunity to credit union borrowers or to credit unions for tax payments made on behalf of those borrowers. The FCUA also does not exempt either 'mortgages' or 'loans' from taxation."

3. Because Congress "expressly stated specific tax exemptions in the FCUA, it is unnecessary to conduct a constitutional analysis of Hudson Valley's status as an instrumentality of the U.S. government."  The brief noted that "Congress expressly defined and limited the tax exemptions granted to federal credit unions in the FCUA" and that legal issues "cannot override the Supreme Court's clear holding that courts should not inquire further into constitutional immunity issues when the governing statute is clear about what tax exemptions do and do not exist for a particular entity."

It noted that those who support the tax exemption "may pursue legislative amendments from the U.S. Congress to achieve the result they seek through this litigation." If that is pursued, the associations said, they, too, "will also weigh in on the proposed amendments through the normal legislative and lobbying channels.  This is precisely where and how the present controversy should be resolved--through the legislative process."

Hudson Valley has appealed two lower courts' decisions that denied its challenge to the MRT. It had filed suit on May 12, 2009, in the New York Supreme Court, a lower trial court, against the New York State Department of Taxation and Finance.

The lower court, in dismissing the case, said the MRT  was a tax on the "privilege" of filing the mortgage under state law. The case then went to the Appellate Division, which upheld the lower court ruling. The credit union appealed, and the New York Court of Appeals agreed on Oct. 18, 2011 to hear an appeal.

Hudson Valley's lawsuit has been supported in various amicus briefs from the Department of Justice, Federal Housing Finance Agency, the Credit Union Association of New York, the Credit Union National Association and the National Association of Federal Credit Unions.

New York's MRT requires a tax of 50 cents for each $100 of debt secured by a mortgage. Most states charge only administrative fees for recording a mortgage (News Now March 21).

AVCU unveils Vermont CU history project

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MONTPELIER, Vt. (5/21/12)--The Association of Vermont Credit Unions (AVCU) has unveiled the inaugural publication of its history project: "The Credit Union Movement in Vermont: A Brief History, 1934-2012."

The initial release has been in the works for the past year, when AVCU commissioned cooperative historian Matt Cropp to research and document the beginnings of credit unions in Vermont and AVCU through the present.  

The ongoing project will be updated as more historical facts come to light and new milestones occur.

Soon, AVCU will publish the project to a wiki so others can contribute to it, and create a "family tree" of Vermont's credit unions, charting incorporations and mergers through the decades, with pages for credit unions to include their own historical information.

A passage from the publication on early credit union activity in Vermont reveals: "While the credit union movement was rapidly spreading across the country under [Roy] Bergengren's leadership, it was slow to arrive in Vermont. Sparsely-populated and rural, the state had not attracted the attention of the CUNEB's [The Credit Union National Extension Bureau, which was the organization that advocated for and fostered credit unions in the U.S. from 1921 until 1934 and the Credit Union National Association's  predecessor] organizers (who tended to find industrial settings the most fertile ground for establishing new credit unions), and it remained one of just a handful of states to have no credit union enabling legislation on the books by the early 1930s.

"However, the ability to legally organize credit unions in the Green Mountain State was finally ensured by the passage of the Federal Credit Union Act in 1934, and the initial few credit unions were established in the subsequent decade."

To read AVCU's first attempt at documenting its history of credit union development in Vermont, use the link. Currently, there are 27 credit unions in Vermont.

Biz Kid receives three Emmy nominations

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MADISON, Wis. (5/21/12)--Biz Kid$, the credit union-funded public television series that teaches kids about money management and entrepreneurship, has received Daytime Emmy nominations in three categories from the National Academy of Television Arts & Sciences.

Biz Kid$ was nominated  for Daytime Emmys Awards in the Outstanding Children's Series, Single Camera Editing and Sound Editing categories, said the National Credit Union Foundation.

Awards will be given on June 17 in Los Angeles.

Biz Kid$ has received 10 Emmy nominations in the last four years, winning once in 2009. This is the first time it has been nominated for Outstanding Children's Series. 

Also, Biz Kid$ recently received its first Parent's Choice Silver Award. Established in 1978, Parents' Choice Foundation is the nation's oldest nonprofit consumer guide to quality children's media. Fewer than 20% of the products submitted to the Parents' Choice Awards program receive any commendation. Parents' Choice serves as an independent source for educators and librarians, journalists and families searching for quality children's media and toys, said NCUF.

Biz Kid$ has garnered attention in and outside of the credit union industry. In 2009, the show won the Environmental Media Award for Outstanding Children's Television Series and rang the closing bell ceremonies at both the New York Stock Exchange and the NASDAQ Exchange for three years in conjunction with National Financial Literacy Month.

In 2010, it also earned a Silver Telly Award for Outstanding Children's Financial Literacy Programming and the credit union industry's most prestigious honor, the Herb Wegner Award for Outstanding Program.

NCUF oversees fundraising, outreach and administrative responsibilities of Biz Kid$, which recently started its fifth season. In the past six years, more than 290 credit unions and affiliated organizations have raised more than $13.2 million to support the show's production, website and curriculum.

CUNA Mutual updates risk alert on Global Payments breach

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MADISON, Wis. (5/21/12)--CUNA Mutual Group has issued another risk alert to its policyholder credit unions on the Global Payments data breach.

The most recent update expands the exposure window back to Jan. 30, 2011 and the risk to additional card numbers for "card-present" and "card-not-present" exposures. The original alert notification mentioned only "card present" risk due to the compromise of the entire magnetic stripe track data, CUNA Mutual said.

Atlanta-based Global Payments  Inc. was removed from Visa's and MasterCard's "compliant service providers" list after revealing March 30 that part of its third-party card processing system had been breached.

Updated alerts are broken down into separate categories addressing "card present" and "card-not-present" exposures. Credit unions experiencing card fraud since January should review "card present" and "card-not-present" fraud and confirm the fraud cases have been reported to the card associations, the alert said.

Credit unions that have identified a common point of purchase should report it to their card associations.

Those experiencing "card present" or "card-not-present" fraud should continue to exercise available chargeback rights, CUNA Mutual said.

CUNA Mutual offered these risk mitigation tips:

  • Continue to evaluate the additional card numbers listed on the Visa compromised account management systems or MasterCard alerts addressing the expanded exposure window back to January.
  • In light of the expanded exposure window and fraud types for the additional card data involving both "card present" and "card-not-present" risk, CUNA Mutual recommends blocking and reissuing the at-risk card numbers. Review the active (open) account numbers listed in subsequent card association alerts from the expanded exposure window to determine if they should be blocked and reissued.
  • Review all other accounts contained on the subsequent alerts that have been closed due to fraud to determine if the fraud pattern can be tied to this event.
  • Continue to work with the card associations on any available dispute action on the fraud cases to determine if recovery can be obtained.
  • Confirm all fraud associated with the breach has been reported to the card association and to CUNA Mutual Group.

Montana league op-ed spotlights CUs cooperative nature

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HELENA, Mont. (5/21/12)--Credit unions' cooperative nature was highlighted in an opinion/editorial by Tracie Kenyon, president/CEO of the Montana Credit Network, published Friday in the Helena Independent Record.

Kenyon asks readers: "Were you aware that credit unions are financial cooperatives? Which means that they are owned by their depositors and created specifically to serve the financial needs of those engaged in the co-op--no stockholders, no paid board members--and what could be more Main Street than that?

"And, at the same time credit unions adhere to the great principles and values listed above, they provide a safe, local option for financial transactions," she added.

Cooperatives by their nature embody the essential idea of "Main Street" or home-grown, locally owned businesses, Kenyon wrote. This especially relevant since 2012 is the United Nations' International Year of Cooperatives, she noted.

"You see, each cooperative business abides by seven principles: voluntary and open membership; democratic control; member economic participation; autonomy and independence; education, training and information; cooperation amongst cooperatives; and concern for community," she explained. "Quite simply, cooperative businesses are owned by their users and organized to provide a service without profit motive."

Credit unions also provide a local option for financial transactions that is safe because credit union deposits are federally insured, Kenyon wrote.

"I invite you to try a locally owned, cooperative business like a credit union and put your money to work in your own community," she concluded.

To read the opinion/editorial, use the link.

Saving challenge 125867 youths deposit 21.3M

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MADISON, Wis. (5/21/12)--Young credit union members deposited about $21.3 million into their share and savings certificates during this year's National Youth Saving Challenge, sponsored by the Credit Union National Association (CUNA).

Kindergarten and first-grade students from St. Mary Magdalen School visited the Bay Atlantic FCU, Millville, N.J., branch during Credit Union Youth Week to learn more about credit unions. (Photo provided by New Jersey Credit Union League.)
Combined, the 241 credit unions that participated in this year's challenge saw 125,867 youths deposit $21.3 million--an average of $169 per child.

"The facts that hundreds of thousands of young people socked away more than $21 million in their credit unions as part of the Saving Challenge are testaments to the commitments of credit unions in reaching out to our nation's youth, and to the commitment of the young savers themselves toward financial responsibility," said Bill Cheney, CUNA president/CEO. "I could not be prouder of the work that credit unions are doing with the Saving Challenge, and I urge even more credit unions to get involved in the future."

During Youth Savings Week at Oregon Community CU, children could design their own pennies. (Photo provided by Oregon Community CU)
In 2009, the Saving Challenge expanded beyond National Credit Union Youth Week to run the entire month of April. This year, more than half (59%) of the participating credit unions ran the challenge for the entire month.

"Be a Credit Union Super Saver" was the theme for this year's Youth Week, held April 22-28. Credit unions hosted lobby and off-site super-hero-theme events, contests, tours, in-school presentations and giveaways.

Bay Atlantic FCU (BAFCU), with $54 million in assets, Vineland, N.J., opened 33 new youth accounts and recorded an additional 21 deposits to existing accounts during the Youth Savings challenge. Total youth deposits were $10,220.52, said the New Jersey Credit Union League (The Daily Exchange May 4). Kindergarten and first grade students from St. Mary Magdalene School visited the BAFCU Millville branch during Youth Week to learn more about credit unions.

 

Taylor Elementary School's third-grade class toured $119 million Communities of Abilene (Texas) CU during Credit Union Youth Week. After the tour, the class presented the credit union with a homemade "Federal Reserve" thank you note. (Photo provided by Communities of Abilene CU.)
Taylor Elementary School's third-grade class toured $119 million Communities of Abilene (Texas) CU during Youth Week. After the tour, the class presented the credit union with a homemade "Federal Reserve" thank you note.

Alexander the Great, a miniature horse, entertained youth at $19 million asset McPherson (Kan.) Co-op CU during Youth Week. Eighteen new youth accounts were opened at the credit union, which received $14,000 in deposits during the challenge.

Oregon Community CU, with $1 billion in assets, Eugene, Ore., opened 84 youth accounts during the challenge, with $1,708 deposits received from young members. They deposited $550,757. Employees visited local elementary schools to teach several classes about the importance of saving. The Salem branch provided a branch tour to kids who are home schooled, elementary through middle school age. Several Boy Scout troops toured the credit union's Coburg branch. The branch also ran coloring contests all month, and gave out gift bags, cookies and double Lucky Duck bucks all week.

Eight St. Louis-area credit unions combined efforts to raise money for Children's Miracle Network Hospitals during April. Together the credit unions donated $5,205 to Children's Miracle Network. In addition to promoting youth financial literacy during April, each credit union committed to donate $5 for each new youth account that it opened; collectively, the group opened 348 new youth accounts in April. Each credit union also agreed to hold its own fundraisers for the hospitals.

The participating credit unions included:

  • 1st Financial FCU, Wentzville;
  • Alliance CU, Fenton;
  • Arsenal CU, Arnold;
  • Electro Savings CU, St. Louis;
  • First Community CU, Parchment
  • Southpointe CU, St. Louis;
  • Vantage CU, Bridgeton,  and
  • West Community CU, O'Fallon.
The 2013 Credit Union Youth Week will be celebrated April 21-27 in 2013.

Wisconsin league board members announced

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The 2012-13 Wisconsin Credit Union League Board of Directors and Executive Committee include, front row, from left, Mike Mallow, Carol Pecsi, Jennifer Schilling, Jack Gill and Kevin Hauser. Back row, from left, Tim Tranberg, Brian Prunty and Kim Youngblood. Not pictured: Pat Lowney. (Photo provided by the Wisconsin Credit Union League)
PEWAUKEE, Wis. (5/21/12)--The 2012-13 Wisconsin Credit Union League members of the board of directors and executive committee were introduced during the league's Annual Convention in Milwaukee.

League board members include:

  • Region 1--Kevin Hauser, Westby (Wis.) Co-op CU;
  • Region 2--Treasurer, Jack Gill, First Community CU of Beloit;
  • Region 3--Chair, Jennifer Schilling, Empower CU, West Allis;
  • Region 4-- Pat Lowney, Lakeview CU, Neenah;
  • Region 5--Vice Chair, Mike Mallow, Sheboygan (Wis.) Area CU;
  • Class A (less than $20 million assets)--Carol Pesci, First CU, Oak Creek;
  • Class B ($20 million to $100 million assets)--Secretary, Kimberly Youngblood, Focus CU, Menomonee Falls;
  • Class C ($100 million to $500 million assets)--Tim Tranberg, Co-op CU, Black River Falls; and
  • Class D (more than $500 million assets)--Brian Prunty, CoVantage CU, Antigo.

Northern Hills branch to reopen today after fire

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STURGIS, S.D. (5/21/12)--The Spearfish branch of Sturgis, S.D.-based Northern Hills FCU is scheduled to reopen today after a fire early Thursday morning shut down the branch.

The branch was closed Thursday, Friday and Saturday due to heavy smoke damage from the fire, said Cindy Griffin, CEO, in press releases on Thursday and Friday on the $46 million asset credit union's website.

Friday's press release said crews would be working throughout the weekend to aerate the building and ensure its safety for employees and members.

The branch will be open today for regular business hours. The credit union encouraged members last week to visit the Sturgis or Belle Fourche branches for financial needs during the weekend.

"We apologize for any inconvenience encountered," said Griffin. "Our main concern is safety and we want to take every precaution before opening the doors Monday," she said Friday.

New Md. law requires CUs banks to report elder abuse

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BALTIMORE (5/18/12)--In October, a new Maryland state law requiring credit unions and banks to report suspected financial exploitation of Marylanders age 65 and older, or face a penalty, will take effect, said an article in The Baltimore Sun (May 15).

The law mandates that credit unions and other financial institutions must convey their suspicions about elder abuse within 24 hours by phone to Adult Protective Services in the state's Department of Human Resources or to law enforcement--and follow up in writing. Financial institutions that fail to do so would face a penalty of as much as $5,000.

The new law also requires financial institutions to train staff to recognize the signs of financial exploitation such as large wire transfers, lots of electronic withdrawals from an elderly person who never used an ATM before, plunges in account balances that the elderly person can't explain, or member/customers who seem afraid of the person who brought them to the credit union or bank.

The state's Adult Protective Services last year investigated 982 cases of financial exploitation--which account for about 15% of its investigations, the newspaper said.

More than a decade ago, Maryland had passed a law that allowed financial institutions to voluntarily report elder financial abuse without violating bank privacy laws.

MECU of Baltimore, a $1.1 billion asset credit union, told the publication it has referred cases of suspected elder financial abuse to authorities. Last fall, it updated its software program to recognize potential abuse, Dorothea Stierhoff, spokeswoman for the credit union, said.

More than 20 states have similar laws requiring financial institutions to report elder abuse. California reported that from 2007, when its law became effective, to 2010 it had received more than 26,000 cases from financial institutions reporting suspected abuse of elders.

Last year a study by MetLife Mature Market Institute reported older Americans were swindled out of $2.9 billion due to elder financial abuse. That was a 12% increase in three years, said the newspaper.

Georgia league elects Boutwell as chairman

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DULUTH, Ga. (5/18/12)--Marshall Boutwell, CEO of Gwinnett FCU, has been elected the 2012-2013 board chairman of the Georgia Credit Union League during its annual meeting held in conjunction with the Georgia Credit Union Affiliates annual convention in Savannah.

Boutwell has been active in the Georgia credit union movement for more than 25 years, 18 of them as CEO of the Lawrenceville, Ga.-based credit union. During his tenure, Gwinnett Federal grew to more than $220 million assets from $14 million.

He serves as a director on several industry-related boards and was honored with the Buck Levins Award, given to an outstanding professional whose efforts in the political arena have contributed to elevating the presence of credit unions at the state or national level, during the Credit Union National Association's Governmental Affairs Conference.

The league board also elected Tim Bridges, executive vice president/chief financial officer at Associated CU, Norcross, to the at-large director position, and re-elected these incumbents:

  • Stephen Smith, Fulton Teachers CU, Hapeville, District 1;
  • Stacy Tallent, Health Center CU, Evans, District 2; and
  • Barry Heape, DOCO CU, Albany, District 3.

CU airs Freedom From Banks media campaign

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WARMINSTER, Pa. (5/18/12)--Freedom CU's new "Freedom From Banks" media campaign will be broadcast on radio and television, and seen on billboards throughout the Greater Philadelphia area from May through October.

The campaign will feature commercials that address growing frustration with large financial institutions and extraneous fees. The commercials highlight the $560 million asset, Warminster, Pa.-based credit union's commitment to its members, and commitment to offer better loan rates and fewer fees with superior service.

The spots, which can be viewed on Freedom's YouTube channel (use the link), were filmed in the Warminster branch and will run on Comcast channels such as Bravo, ABC Family, FX, TLC, TNT, and USA Network. Radio spots will be heard locally. Billboards throughout the Philadelphia region, including a digital board, round out the full-scale media blitz.

Portland commissioners pass deposits-in-CUs bill

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PORTLAND, Ore. (5/18/12)--A proposal to allow more credit unions and local banks to accept city deposits from Portland, Ore., was passed into law Wednesday on a 5-0 vote by Portland city commissioners.

Portland Mayor Sam Adams' proposal--called the Responsible Banking Resolution--mandates depositing $250,000 of city money in each of 10 Oregon credit unions and banks (Portland Business Journal May 16).

The money for the move would come once the city liquidates $2.5 million of its $800 million in U.S Treasuries and other securities, the newspaper said.   

With the proposal, Portland also would improve transparency and rework its contract for financial services to make is easier for credit unions and local banks to compete for city business, the paper said. A similar ordinance was passed this week in Los Angeles.

The Los Angeles City Council on Tuesday adopted a "responsible banking" ordinance that will require banks doing business with the city to disclose detailed data on loans and foreclosure activity by the community (latimes.com May 16).

Since there has been an increased focus on big banks' roles in the economic collapse, such proposals have gained momentum nationwide, the paper said.

To read the article, use the link.

Ohio committee kills CU amendment

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COLUMBUS, Ohio (5/18/12)--An Ohio House committee Tuesday killed an amendment that would have made the state's credit unions eligible for deposits of public funds.

The Ohio House of Representatives' Ways and Means Committee voted 9-8 Tuesday to table an amendment to financial institution tax legislation (HB 510) that would have included credit unions as eligible depositories of public funds, said the Ohio Credit Union League (eLumination Newsletter May 17). 

The amendment was introduced by State Rep. Tom Letson (D-Warren), co-sponsor of other credit union public funds legislation HB 441. Fellow co-sponsor State Rep. Terry Blair (R-Washington Township) was the only Republican, along with all the committee's Democrat members, to vote against tabling the amendment.

"It is ironic that Ohio's banking sector supports tax reform for itself, but continues to vehemently oppose removal of restrictive mandates on credit unions that would expand opportunities for economic growth for many local governments, businesses, and citizens," said John Kozlowski, general counsel at the league.

Prior to the vote, the league sent a letter to committee members requesting their support of the amendment.

Blair and co-sponsor Tracy Maxwell Heard (D-Columbus) testified in favor of HB 441 earlier in the week before the Ohio House Financial Institutions, Housing and Urban Development Committee.  HB 441 is working its way through both chambers of the General Assembly.

The measure would give Ohio's schools, local governments, communities, libraries, police and fire districts and others greater choice by removing a state mandate preventing them from utilizing community-based credit unions as public depositories.

Current law "limits the ability of the more than 3,900 political subdivisions in Ohio from evaluating all available options when making decisions…on behalf of their citizens," testified Blair. "If we have learned anything from the past few years, it is that diversification in the placement of funds in a community is extremely important, and that local government needs more tools in its toolbox."

The legislation was the focus of meetings throughout the year between credit union and Ohio league leaders and members of the House and Senate financial institutions committees, including during last month's InVest48, the league's convention and expo.

Colo. CUs form business operational alliance

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DENVER, Colo. (5/18/12)--A group of mid-sized Colorado credit unions have formed a business and operational alliance that extends the credit union philosophy of "people helping people" to "credit unions helping credit unions."

The Alliance of Rocky Mountain Credit Unions will offer marketing, training, pricing and other business support and coaching to help credit unions thrive and grow (Denver Post May 15).

Among the group's initiatives is a program to assist small credit unions, said Sundie Seefried, alliance founder and president/CEO of Partner Colorado CU, Arvada.

The new group has collaborated on MyBank2Go, a Denver marketing project. It also provided four credit unions with $2000 sponsorships to develop social media programs working with a local public relations firm.

Although large credit unions are not part of the Alliance, $3.6 billion Ent FCU, Colorado Springs, and $1.1 billion Elevations CU, Boulder, sponsored small credit unions for the program.

The credit unions and their sponsors for the social media program are:

  • Community Choice CU, Commerce City, sponsored by Denver (Colo.) Community CU;
  • Electrical FCU, Arvada, sponsored by Elevations CU;
  • West Denver (Colo.) Community CU, sponsored by Ent FCU; and
  • Westminster (Colo.) FCU, sponsored by Partner Colorado CU.
The Alliance of Rocky Mountain Credit Unions includes:

  • Arapahoe CU, Centennial;
  • Aurora (Colo.) Schools FCU;
  • College CU, Greeley;
  • Colorado CU, Littleton;
  • Columbine FCU, Centennial; 
  • Community Choice CU;
  • Denver Community FCU;
  • Foothills CU, Lakewood;
  • Horizons North CU, Northglenn;
  • Metrum CU, Centennial;
  • Partner Colorado CU;
  • Sooper CU, Arvada;
  • Space Age FCU, Aurora; and
  • White Crown FCU, Denver.

CU System briefs (05/17/2012)

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  • TEXARKANA, Ark. (5/18/12)--Joe Glenn "Joe T" Thornton, who during his long credit union career held director positions with the National Association of State Credit Union Supervisors, Texas Credit Union Commission, Texas Credit Union League, Town North National Bank, Southwest Corporate FCU and Wright-Patman Chapter of Credit Unions, died May 15 at Scott and White Hospital in Round Rock, surrounded by family and friends. In 1962, upon graduating from the University of Houston, Thornton launched a successful career in accounting and finance when he accepted a position with Amoco. He followed that with a position at a credit union regulatory agency in Houston and then moved on to Teachers FCU in Texarkana. He retired after 18 years as president at Teachers. From 1991-1993, and again in 1995, Thornton was a national director of the Credit Union National Association. Thornton is survived by:  his wife, Patsy; daughter, Pamela Ward, and her husband, Kyle, of Leander; son, Gus, and his wife, Julie Thornton, of Texarkana; and four grandchildren. A memorial service will be held on Saturday   at Williams Memorial United Methodist Church in Texarkana …
  • SAN DIEGO (5/18/12)--A man dubbed the "well-dressed bandit" by the Federal Bureau of Investigation (FBI) was sentenced in San Diego Wednesday  to 51 months in a federal prison in connection with nine bank and credit union robberies between July 15, 2010, and Sept. 23, 2011.  Anthony Pernelle Burgess also was ordered by U.S. District Judge Michael M. Anello to pay restitution totaling $48,024 to the financial institutions.  Among the nine robberies were two credit unions that were hit twice each during 2011. Point Loma CU was robbed of $8,812 on Feb. 11 and of $5,506 on June 17.  Mission FCU was robbed of $7,338 on April 6 and $4,191 on Aug. 2, said the FBI press release …
  • COLUMBUS, Ohio (5/18/12)--The Ohio Credit Union Foundation  (OCUF) said 23 student members submitted videos that answered the question, "How Financially Savvy Are You," to its Video Scholarship competition. Matthew Kubiak, a member of Directions CU, Toledo, was announced the winner of the 2012 scholarship totaling $5,000. He will attend University of Dayton in the fall. Kubiak's video shared scenariosa of "what financially savvy people say," both before and after joining a credit union. Before joining, the character portrayed by Kubiak spent money carelessly and failed to worry about mounting credit card debt, hidden fees, expensive purchases, and saving for college. After begging for help, the unwise character joins a credit union. As a result, he learns to save money by using coupons, monitoring fees and spending only what he has. The video concluded with Kubiak cutting up a credit card and exclaiming, "I'm free!" Entries were judged on content, design, originality and use of enhancements. Watch the winning video and videos from the other four finalists …
  • MARLBOROUGH, Mass. (5/18/12)--John Morawski, chief technology officer of the Massachusetts Credit Union League has been reappointed to the BITS Liaisons Task Force, according to the lLeague (E-Weekly May 16) . BITS is a not-for-profit industry consortium whose members are 100 of the largest financial institutions in the U.S. It fosters the growth and development of electronic financial services and e-commerce for the benefit of financial institutions and their member/customers.  Morawski has worked with the league the past 13 years …

Maine league announces board officers (05/17/2012)

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PORTLAND, Maine (5/18/12)--The Maine Credit Union League board elected its slate of officers for 2012-2013 at its Annual Meeting and Convention.

The 2012-2013 table officers for the Maine Credit Union League Board of Directors are:

  • Chair--David Rossignol, president/CEO of NorState FCU with $148 million in assets, which is headquartered in Madawaska with additional locations in Ashland, Eagle Lake, Fort Kent, Presque Isle and Van Buren;
  • Vice chair--Gail Richardson, president/CEO of the $118.1 million asset Midcoast FCU, whose main office is in Bath with branches in Brunswick, Edgecomb and Thomaston;
  • Secretary--James Lemieux, president/CEO of Sebasticook Valley FCU, a $70.2 million asset credit union, which is headquartered in Pittsfield with a branch in Newport and an in-school branch at Nokomis Regional High School; and
  • Treasurer--Richard Lachance, president/CEO of $29.7 million asset Maine Education CU, which has three locations in Augusta including an in-school branch at Capital Area Technical Center at Cony High School.
In other board news from the convention, Normand R. Dubreuil, president/CEO of $329.1 million asset Maine State CU based in Augusta, with a branch in Waterville, was elected to another three-year term as an at-large director.

Central Ohio Chapter cash mobs hit local businesses

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COLUMBUS, Ohio (5/18/12)--The Central Ohio Chapter of the Ohio Credit Union League has organized a "cash mob" initiative to support local small businesses.

Each month, Central Ohio credit unions encourage their members and employees to descend upon a local business at a chosen date and time to buy products and services from that business, said the Ohio Credit Union League (eLumination May 17).

The inaugural event will be held from 4 p.m. to 7 p.m. ET May 24 at the Weiland Gourmet Market, Columbus, Ohio.

Local officials, including State Rep. Tracy Heard (D-Columbus) will join the chapter to launch the initiative. Heard was a co-sponsor of SB 441, an amendment that would have made Ohio credit unions eligible for deposits of public funds. The amendment was killed on Tuesday. Read "Ohio committee kills CU amendment" in today's issue.

Local media will be contacted about the event, the chapter said.

A cash mob also is scheduled for June 21 at The Peanut Shoppe in Columbus.

NCUA WesCorp figure settle lawsuit

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LOS ANGELES and WASHINGTON (5/18/12)--The chief investment officer at the now defunct Western Corporate FCU and the National Credit Union Administration (NCUA) have entered a settlement agreement in the lawsuit over the mortgage-backed securities (MBS) losses that WesCorp experienced before its collapse.

The settlement resolves all claims and counterclaims between Robert J. Burrell and NCUA, which was WesCorp's liquidating agent. It dismisses the case "with prejudice," according to court documents filed Wednesday in the U.S. District Court Central District of California, Los Angeles.

The settlement was followed by NCUA's announcement Thursday that it had issued a cease-and-desist order to Burrell, who consented to the order without admitting fault. The order bans him from:

  • Being an employee of, holding any office in, or otherwise participating in any manner in the conduct of affairs of any federally insured corporate credit union;
  • Consulting or advising any federally insured corporate on any matters involving or relating to investment securities, investment policy, or investment strategy; or
  • Selling any investment securities to any federally insured corporate credit union.
The order was one of the terms of the settlement.

Also, Magistrate Judge Margaret A. Nagle scheduled a settlement conference for May 24 between another key figure in the case, former WesCorp President/CEO Robert Siravo, and NCUA for May 24 at 10 a.m.

NCUA sued five WesCorp executives to try to recoup $6.8 million in investment portfolio losses from MBS, alleging the executives were negligent in monitoring the corporate's investments as well as breach of fiduciary duty and fraud (News Now April 6).

Church asks more time in suit vs. NCUA over losses

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CLEVELAND, Ohio (5/17/12)--An Ohio church suing the National Credit Union Administration (NCUA) over its losses from the collapse of St. Paul Croatian FCU in 2010 has asked a federal court for more time to respond to NCUA's motion last week that asked the court to reconsider its order allowing discovery on the issue of "bad faith" in the lawsuit, which involves a deposit insurance claim.

A status conference was originally supposed to be held today, but in a filing Wednesday in the U.S. District Court for the Northern District of Ohio Eastern Division, the Holy Love Ministries, based in North Ridgeville, Ohio, said it had not received NCUA's motion to reconsider and the church would need 20 additional days to respond to it.

NCUA's motion says the church is not entitled to discovery in the appeal because the discovery sought "relates to tort claims that are not before this court."

The case involves an appeal from the NCUA Board's decision that the church was entitled to the statutory maximum $250,000 in share insurance.  "Thus, the only question in this insurance appeal is whether the Board's decision….was arbitrary and capricious, or otherwise contrary to law," said the NCUA's motion to reconsider.

At the time the Eastlake, Ohio-based St. Paul Croatian FCU was  liquidated by NCUA on April 20, 2010, the church had two joint accounts totaling $1.7 million with multiple co-signers on the accounts but received only the $250,000 insurance payment available to single accounts, according to the church's complaint. It is suing to recoup the $1.5 million remaining or at least a second $250,000 payment because the two accounts were joint accounts, according to court document (News Now Feb. 23).

The church's complaint said that several days before the credit union's collapse, a church representative tried to withdraw funds from the accounts but was told not to by NCUA. As a result, said the court document, the church's two-year $12 million building project was endangered. It was also denied a "hardship" exception to the $250,000 insurance limit, said the court documents.

The issues in which the church is seeking discovery "cannot affect any remedy that the court has jurisdiction to award in this appeal," said the motion NCUA filed Friday. "As plaintiff should have done initially, plaintiff has now filed an administrative claim against NCUA under the Federal Tort Claims Act (FTCA)."  The FTCA, said NCUA, "is the only proper avenue by which plaintiff can assert the claims it is improperly trying to bring in this appeal."

NCUA noted the church doesn't allege bad faith in the board's determination of its share insurance claim, which is the decision at issue in the appeal. Bad faith, fraud, or misrepresentation claims that are not part of the insurance determination itself may not be adjudicated as part of an insurance appeal, said the court document.

Permitting discovery, said NCUA, "would permit plaintiff to circumvent the jurisdictional requirements of the FTCA, and allow plaintiff to litigate claims against the U.S. over which this court lacks subject matter jurisdiction," said the motion to reconsider.

NCUA's National Credit Union Share Insurance Fund lost $170 million when the credit union collapsed due to fraudulent activities of its leaders. It was one of the largest credit union failures in history.

Man files multiple lawsuits citing ADA

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PITTSBURGH, Pa. (5/17/12)--A Pennsylvania man who has filed multiple lawsuits against banks and claimed their ATMs have violated Title III of the Americans with Disabilities Act (ADA) by not offering accommodations for the blind has sued a Pittsburgh, Pa.-based credit union.

Robert Jahoda, 30, filed a class action suit on May 9 in the U.S. District Court in the Western District of Pennsylvania against Century Heritage FCU, a $128.6 million asset credit union,  alleging the Title III violation, according to the court documents.

"Title III of the ADA prohibits discrimination in the activities of places of public accommodation and requires places of public accommodation to comply with ADA standards and to be readily accessible to, and independently usable by, individuals with disabilities," said the complaint filed with the court.

Jahoda's complaint alleges that he is blind and visited the credit union's ATM in McKeesport, Pa., after March 15, the date in which certain communications provisions of the ADA and its 2010 standards became fully effective.

"At the time of the visit, the ATM was not fully accessible to, and independently usable by, blind people, in that there was no voice guidance function available at the ATM," said the court document, which also alleged that the credit union's ATM network did not have any voice guidance feature and had  function keys without specific tactile symbols required by the 2010 standards.

During the visit, the complaint alleged, Jahoda had an ATM card and headphones that are compatible with the law's 2010 standards. The complaint noted that he "intends to return to certain of defendant's ATMs to ascertain whether they remain in violation of the ADA."

The situation "threatens blind people with the loss of their private banking information," said the complaint. "Blind people who wish to use certain of the defendant's ATMs have no choice but to repeatedly reveal their private PINs to others to complete an ATM banking transaction."

Jahoda's lawsuits against financial institutions  allege some ATMs "are not, and have never been, speech enabled, or they have a speech-enabling feature that is not functional." Some input keys do not have the correct tactile symbol, do not contrast visually from background surfaces, do not meet font and visual contrast requirements, and do not provide auxiliary aids or services for full accessibility.

According to the Pittsburgh Post-Gazette (April 23), Jahoda as of April 23 had filed similar suits against at least seven banks during the previous four weeks claiming their ATMs did not comply with the law.

The banks are Citizens Bank of Pennsylvania, First Commonwealth Bank, Commercial Bank & Trust of Pennsylvania, Fidelity Bank, Charleroi Federal Savings Bank, lst National Community Bank, and Home Savings and Loan of Youngstown, Ohio, according to the Post-Gazette. The newspaper quoted Jahoda's attorney as saying more lawsuits were being planned.

The case is before Chief U.S. District Judge Gary L. Lancaster and has been referred to a U.S. magistrate judge for all non-dispositive pretrial proceedings.

Mountain West CU Association OKs foundation merger

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DENVER and PHOENIX (5/17/12)--At the Mountain West Credit Union Association's (MWCUA) First Annual Meeting and Convention, May 9-12, the board of directors from the Arizona, Colorado and Wyoming credit union foundations approved their proposed merger. 

The board of directors of the newly formed Mountain West Credit Union Foundation will include individuals representing the states' foundations. Members include:

  • Chairman--John Uchida, Space Age FCU, Aurora, Colo.;
  • Vice chair--Judy Auvil, San Tan CU, Chandler, Ariz.;
  • Secretary--Jane Prancan, Bellco CU, Greenwood Village, Colo.;
  • Treasurer--Marsha Tynsky, Trona Valley FCU, Green River, Wyo.;
  • Walt Marx, College Credit Union of Greeley (Colo.);
  • Brain Barkdall, American Southwest CU, Sierra Vista, Ariz.;
  • Scott Earl, MWCUA, Denver and Phoenix; 
  • Bob Hoel, Filene Research Institute, Madison, Wis.;
  • Todd Pearson, Arizona Central CU, Phoenix;
  • Tyler Valentine, Laramie (Wyo.) Plains Community FCU; and
  • Mike Williams, Colorado CU, Littleton, Colo.
 

MWCUA also named Jim Bender, a board member from Boulder (Colo.) Valley CU as its 2012 Volunteer of the Year.

Ensweiler letter to ed. Small biz needs loan opportunities

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GALVESTON, Texas (5/17/12)--Credit unions could significantly help small businesses that need lending opportunities--without the need for any new tax money to be spent--Dick Ensweiler, president/CEO of the Texas Credit Union league, wrote in a Wednesday letter to the editor of The Daily News in Galveston, Texas.

The letter was a response to a May 9 editorial in the newspaper by Eric Sandberg of the Texas Bankers Association that argued for limiting credit union lending to small businesses.

"The Credit Union Small Business Jobs Bill, Senate Bill 2231, would increase the cap on credit union business lending, adding $800 million in new loans to Texas small businesses in the first year alone and help create an estimated 8,900 new jobs--all without a dime of new taxes," Ensweiler wrote.

"And still Mr. Sandberg thinks we should limit credit union lending to small businesses?" Ensweiler added. "He's certainly alone in that opinion. Forbes calls it a 'no-brainer.' A coalition of conservative think tanks … says 'the bill is a sound, free-market, deregulatory action that will create jobs, help small business and assist veterans.' The Texas Association of Business wrote that the bill is 'sound policy for Texas business,'" Ensweiler added.

Ensweiler also emphasized that because credit unions are not-for-profit cooperatives owned by their members, they pay all taxes except corporate tax. "Half of Texas for-profit banks take advantage of S-Corp tax status to pay little or no corporate tax," Ensweiler added.

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase credit unions' member business lending (MBL) cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in business 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.

Filene piloting Amazon.com credit card program

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MADISON, Wis. (5/17/12)--The Filene Research Institute has launched a pilot program in which credit unions can offer credit cards online through Amazon.com's Credit Central storefront.

Credit unions will be charged a one-time fee by Filene, based on their asset size, to participate in the pilot program for 12 months.

Amazon.com shoppers will view online banner ads for credit cards, which they can click through for more information, said Sandy Naylor Amazon product manager. Amazon will also provide a ZIP code search capability.

Shoppers that purchase cards online will be able to review their experience online, similar to other Amazon.com purchases.

Amazon.com previously offered its Credit Central storefront in four countries--the United Kingdom, Japan, Canada and Germany--and is rolling out the program in the U.S.

Amazon.com previously could not sell credit cards online in the U.S. because of co-branding relationship with Chase, said Naylor.

"Amazon is a way for products that offer great features and benefits to rise to the top and compete with products that have well-known brands and bigger marketing budgets," Naylor said in a webinar announcing Filene's program. "Ratings and reviews are a way for them to shine. For a credit union that does not have a large marketing budget, that makes you a force to be reckoned with."

Participants in the pilot will be provided with benchmarking data and guidance for improving their online conversion rates.

Jason Milesko, Filene chief of advisory services, stressed that the pilot offers "an early mover advantage" in the online credit card market.

"It's a chance to beat the banks to this new sales channel," Milesko said. "If they do make it, you'll already be experts, and you'll be able to highlight your product advantage," he told credit unions.

Holy Rosary CU receives CDFI designation

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KANSAS CITY, Mo. (5/17/12)--Holy Rosary CU, Kansas City, Mo., has been certified as a community development financial institution (CDFI) by the U.S. Department of the Treasury.

The CDFI designation, which certifies community-based lenders as providers of critical services to low- and moderate-income communities and other target markets, allows certified institutions to apply for grant funding from the CDFI Fund and other sources to expand services and increase impact.

About 82% of Holy Rosary CU's membership is low income, the $11 million asset credit union said.

Established by the Riegle Community Development and Regulatory Improvement Act of 1994, as a bipartisan initiative, the CDFI Fund provides certified CDFIs with monetary awards and the allocation of tax credits to promote access to capital and spur local economic growth in urban, rural and reservation-based low-income communities nationwide.

The CDFI Fund has provided almost $1.3 billion to CDFIs nationally, including $120 million to CDFI-certified credit unions since 1996.

As an emerging CDFI, Holy Rosary submitted and received a technical assistance grant last year for $93,000.  This year Holy Rosary submitted a $600,000 request as a certified CDFI.  

Credit Union Strategic Planning based in Tacoma, Wash., worked with Holy Rosary to obtain the designation.

Leagues MBL message on airwaves at job fair

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A panel moderated by radio show host Geraldo Rivera at a "Putting America Back to Work" job fair at the Javits Center in New York City included, from left, Quick Check Senior Vice President of Operations Mike Murphy; New Jersey Credit Union League President/CEO Paul Gentile; Rivera; My Pillow inventor Michael J. Lindell; and Newtek CEO Barry Sloane. (Photo provided by the New Jersey Credit Union League) 
NEW YORK (5/17/12)--The New Jersey Credit Union League explained the credit union member business lending (MBL) message on the airwaves Tuesday on a panel moderated by radio show host Geraldo Rivera at a "Putting America Back to Work" job fair at the Javits Center in New York City.

League President/CEO Paul Gentile spoke on the panel along with Rivera; Michael J. Lindell, inventor, MyPillow; Barry Sloane, CEO, Newtek, a CUNA Strategic Services provider; and Mike Murphy, senior vice president  of operations, Quick Check, from 10 a.m. to noon. The panel discussion was broadcast live on WABC 770 AM (The Daily Exchange May 16).

When introducing Gentile, Rivera pointed out that credit unions are pushing for legislation that would help put America back to work.

Gentile explained that if Congress passed the legislation, credit unions could lend up to an additional $13 billion in the first year if the MBL cap were raised to 27.5% of assets from 12.25%, creating more than 140,000 new jobs nationwide at no cost to taxpayers--a position espoused by the Credit Union National Association.

Credit unions have been lending to their business-owning members for a century; there was no MBL cap prior to 1998, Gentile said. And unlike banks, credit unions have a sound track record when it comes to business loans, specializing in lower loan amounts, he added.

Banking You Can Trust ad grabs attention

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This billboard ad for New Jersey Credit Unions' "Banking You Can Trust" consumer awareness campaign received some different placement, juxtaposed next to a billboard for the biography on legendary Apple technology icon Steve Jobs at a New Jersey train station. (Photo provided by the New Jersey Credit Union League)
HIGHTSTOWN, N.J. (5/17/12)--The New Jersey Credit Union League's (NJCUL) "Banking You Can Trust" ad campaign features a series of ads placed in New Jersey Transit train stations in an effort to grab the attention of New Jersey's millions of train commuters.

NJCUL's ad was juxtaposed next to a billboard advertising the biography on legendary Apple technology icon, the late Steve Jobs, who challenged consumers to think differently about technology. The placement was nothing more than a coincidence, but hopefully the stories can marry up, said the league (The Daily Exchange May 16).

"If you think back just 10 years ago, Apple was nothing more than a niche computer player that was favored mostly by creative professions like publishing," league President/CEO Paul Gentile said. "Fast forward to today and Apple dominates smartphones, tablets and online music.

"We're challenging consumers to think differently about their financial lives and to wake up to the power of credit unions," he added. "Hopefully we will look back 10 years from now and remember this as the time that credit unions start to go mainstream for consumer financial services. As consumers grow weary of big bank fees and practices, the time has never been better for credit unions to tell their story to consumers."

CU System briefs (05/16/2012)

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  • LONGVIEW, Wash. (5/17/12)--A former employee of Cowlitz CU was sentenced to 90 days in jail Tuesday on charges of first degree theft for embezzling $120,000 from the Longview, Wash.-based credit union. Superior Court Judge Stephen Warning said he wished he could give Roxane Justine Ramey, 55, of Longview more jail time but the sentence was at the top of the legislative-mandated sentencing guidelines.Ramey, who was in charge of the credit union's vault, pleaded guilty to the theft, which occurred between July 1, 2010, and Dec. 2, 2011. Ramey and her husband, Ervin (Ron) Ramey apparently wracked up nearly $112,000 in losses at a nearby casino. Roxane Ramey was also ordered to pay $120,000 in restitution (The Daily News and tdn.com May 15) …
  • MADISON, Wis. (5/17/12)--The number of new businesses formed in Wisconsin through April increased 13,006--an 11.9% increase over the first four months of 2011, said the Wisconsin Department of Financial Institutions Monday. The increase was driven by a rise in the number of limited liability companies (LLCs). Year-to-date domestic LLC formation is up 14%, compared with 2011. DFI, which is the filing office for new businesses in the state, tracks data monthly and posts it on its website. Click the link to access the full report.  Credit unions are urging Congress to pass a bill that would allow them to loan more to small businesses. Raising their member business lending cap would infuse $13 billion in business loans into the economy and help create 140,000 jobs, says the Credit Union National Association ... 
  • ALBANY, N.Y. (5/17/12)--Jim "The Rookie" Morris, whose story inspired a Disney movie starring Dennis Quaid, will speak June 9 at the Credit Union Association of New York's Annual Meeting and Convention in Lake George. He will share with credit unions how he rose from a 35-year-old high school teacher to a flame-throwing big league pitcher in three months. The movie, "The Rookie," won the ESPY for Sports Film of the Year and recently was named by Sports Illustrated as one of the five greatest baseball films. Morris' childhood dream of becoming a major league baseball player was derailed by injuries and a lack of maturity, he has admitted. Eleven years after he retired from baseball, his dream was re-ignited when he made a bet with the players of a high school team he coached. He lost the bet, but won his dream: pitching for a major league baseball team …
  • COLLINSVILLE, Ill. (5/17/12)--Collinsville, Ill.-based Scott CU has pledged $100,000 during the next five years to support St. Joseph's Hospital, which recently broke ground for a 91,000-square-foot facility expected to be completed in the summer of 2013. "We realize that without the members of this area, we would not be successful," said Scott CU President/CEO Frank Padak, who met with hospital representatives recently to present a check and express the credit union's support.  "This is another great opportunity for us to give back to the residents of Highland," he added …
  • ST. LOUIS (5/17/12)--Vantage CU hosted a delegation of six Malawi credit union
    Click to view larger image Click for larger view
    leaders during the week of May 10 at its Bridgeton, Mo., headquarters. The visitors, from five credit unions in three districts in the small southeastern African country, were led by Sylvester Kadzola, CEO of the Malawi Credit Union League--Malawi Union of Savings & Credit Cooperatives (MUSCCO). Vantage was one of many credit union visits made by the group. Vantage leaders discussed lending practices, collections, information technology procedures and marketing tools with the group before a tour of its branch and operations. Shown with Vantage staff are, from left, front row: Albert Moyo, Mzimba Teacher's SACCO (Northern Region); Faith Manganda, MUSCCO; Itai Msiska from Karonga Teachers SACCO (Northern Region); Brian Chyuse, Fodya SACCO Ltd. (Central Region); Kadzola; and Charles Nyekanyeka from Bvumbwe Community SACCO (Southern Region). All are presidents or executive officers of their credit unions. (Photo provided by Vantage CU) …

Consumer credit-score knowledge improves says CFA

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WASHINGTON, D.C. (5/16/12)--During the past year, consumers' knowledge about credit scores improved significantly, with more awareness about who collects information on which most scores are based, the importance of checking this information, what good scores are, how to raise them and what service providers use these scores, according to a new study,

However, most consumers still don't know how costly a low credit score can be, when multiple inquiries hurt their scores and the risks of purchasing credit repair services, said the Consumer Federation of America (CFA) and VantageScore Solutions.  A representative sample of more than 1,000 adults Americans were polled by phone in April by ORC International for the report.

In the survey, 42%  of respondents said they had obtained or received at least one of their credit scores in the past year.  Nearly half of this group said their source was a consumer or mortgage lender (45%) and/or a website using credit reports at the three main credit bureaus (49%). On almost all questions, those who had recently obtained a score or scores were more likely to know the correct answers than those who had not obtained scores.

Despite improvements in their knowledge about credit reports and scores, most consumers still lack knowledge in key areas--areas that credit unions could easily include in their financial literacy and education efforts with members and nonmembers. 

For example:

  • Few (29%) know how costly low scores can be on a $20,000, 60-month auto loan.
  • Less than half  (44%)  understand that a credit score typically measures risk of not repaying loans, rather than amount of debt (22%), financial resources (21%), or other factors.
  • Over half still think, incorrectly, that a person's age (56%) and marital status (54%) are factors used to calculate credit scores, and 21% incorrectly believe that ethnic origin is a factor.
  • Few understood when one's credit score is potentially harmed by multiple inquiries while getting a loan. Only 9% knew that multiple inquiries during a one- to two-week window will not lower FICO scores or VantageScore credit scores; 34% incorrectly believed that each inquiry lowers one's scores.
  • More than half (51%) incorrectly believed that credit repair companies are "always" or "usually" helpful in correcting credit report errors and improving scores. According to the study, experts agree that credit repair companies often overpromise, charge high prices and perform services that consumers could do themselves.
Credit reports and credit scores are most influential in the lives of 18- to 35-year-olds because this group has fewer financial resources and is more likely to use credit, said CFA and VantageScore in a press release. They noted it is encouraging that young adults know more than older ones about credit reports and scores. That was the case on questions ranging from the cost of a low score to how to raise one's score to the importance of checking the accuracy of credit reports.

WOCCU at IRS hearing Adjust FATCA definitions

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WASHINGTON (5/16/12)--During a hearing convened by the Internal Revenue Service Tuesday, the World Council of Credit Unions (WOCCU) urged the agency to consider changes to its proposed Foreign Account Tax Compliance Act (FATCA) regulations that would reduce undue regulatory burdens on credit unions in other countries.

Expanding the definition of "non-registering local banks" to include credit unions would help relieve the strain of unnecessary IRS reporting for non-U.S.-based credit unions already unable to serve members like those the IRS seeks to tax due to membership restrictions.

"Credit unions are in most cases small, localized financial institutions that, like banks, provide their members with access to retail banking services such as lending and deposit products," said Michael Edwards, WOCCU chief counsel and vice president for advocacy and government affairs, to the panel of IRS representatives. "We therefore urge the IRS to amend the definition of 'non-registering local bank' in the final FATCA regulation to add the phrase 'or as a credit union or similar cooperative credit organization.'"

Representatives from 21 global financial organizations spoke at the hearing, including bank trade associations from Australia, Japan and Switzerland. WOCCU was only organization speaking on behalf of credit unions and financial cooperatives.

The proposed FATCA regulations, which currently require many foreign financial institutions (FFIs)--including credit unions--to register with the IRS for the purpose of detecting taxable account activity by U.S. citizens in foreign countries, would place unnecessary and inappropriate burdens on small non-U.S. credit unions, WOCCU said in an April 30 letter to the IRS.

The IRS last week invited WOCCU to testify in the hearing to make its case for evisiosn to proposed FATCA provisions.

WOCCU also urged the IRS to make other changes to the rule, including:
  • Raise the maximum  asset threshold for credit unions meeting the "non-registering local bank" definition to US$1 billion from the current $175 million.
  • Amend the proposed definition of "local FFI" to reduce regulatory burdens on non-U.S. credit unions and prevent unintended consequences. Some unintended consequences could include:  allowing credit unions with 95% or more of their accounts held by local residents to meet the "local FFI" definition, and allowing national or provincial credit union associations to register with the IRS on behalf of their member credit unions that meet the "local FFI" definition and obtain a single FFI Employer Identification Number that could be used by all the association's "local FFI" member credit unions.
  • Modify the proposed rule to permit institutions to receive refunds withheld erroneously under FATCA, even when the institution is a "nonparticipating FFI."
  • Exempt international workers' remittances from FATCA coverage to promote financial inclusion for underserved immigrant populations and their families in developing countries.
  •  Limit FATCA's regulatory burdens on credit unions that are "withholding agents," including U.S. credit unions that act as "withholding agents" under FATCA.

"In many countries credit unions already are challenged in providing critical financial services to their members," said Brian Branch, WOCCU president/CEO. "The easing of unnecessary and inappropriate regulations on these small institutions will allow them to commit more capital to better serve those members."

The final FATCA regulations, due to take effect Jan. 1, will be released before year-end.

IWall Street JournalI spotlights CUs video-teller kiosks

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RALEIGH, N.C. (5/16/12)--Raleigh, N.C.-based Coastal FCU's newest technology--remote video teller kiosks--was in the national spotlight Tuesday in an article in The Wall Street Journal about the latest "gizmos" that enable financial institutions to let their members and customers do-it-themselves.

"Banks join the Do-It-Yourself Craze" features two photos of Coastal FCU's video kiosks with remote tellers and notes that touch screens, video-tellers and self-serve kiosks can reduce waiting time for member/customers and free up employees to sell products that boost the bottom line.

"Coastal FCU in North Carolina last year found a way to go high-tech without sacrificing the virtues of face-to-face contact," the article said.  Members at its 15 branches are directed to video screens that connect to 36 tellers, who are in a room at the credit union's Raleigh headquarters. The remote tellers authorize transactions, review check images and dispense cash,  just as they would in person.

The credit union cut costs 40% by eliminating its branch tellers, Willard Ross, the credit union's chief retail officer, told the national newspaper. Members still get personal contact, and the remote tellers can make judgment calls that an automated system can't.

Branch managers don't have to worry about manning teller operations, so they can be totally focused on the members who walk in.  Product sales have nearly doubled in the branches, Ross said.

Use the link to read the complete article.

Ohio CUs have 24 hike in MBL originations

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COLUMBUS, Ohio (5/16/12)--Ohio credit unions loaned out $133.2 million in member business lending (MBL) originations during 2011, an increase of 27.3% from 2010's originations totaling $107.7 million, according to the Ohio Credit Union League.

The league's Ohio Credit Union Quarterly Performance Summary indicated that 105 of Ohio's 377 credit unions reported outstanding MBL balances, totaling $430.5 million statewide.

"Credit unions' ability to manage a strong loan portfolio during stressful economic times is an indicator of how they can benefit the economic engine and entrepreneurial spirit of our state," said league President Paul Mercer. "Most important, credit unions are safe, strong, and ready to do more. With prompt congressional action on S.B. 2231, credit unions can inject $275 million into the state's economy and create nearly 3,000 Ohio jobs," Mercer added.

S.B. 2231, the Credit Union Small Business and Jobs bill, would increase credit unions' ability to make MBLs by raising their MBL cap to 27.5% of assets from 12.25% of assets. The Credit Union National Association estimates that raising the limit would help boost the economy by injecting $13 billion in new small business loans and 140,000 new jobs, without costing taxpayers a dime.

In other statistics from the state report:

  • Share balances grew to $19.4 billion by year-end 2011, a 5.9% increase from 2010. Consumer loan originations rose more than 19%, to $3.5 billion during the period.
  • Ohio credit unions originated $1.5 billion in first mortgages, accounting for 26.6% of total loan originations during 2011. Overall, first mortgages declined 9.1% one year after setting record growth in the loan category.  However, fourth quarter was one of the strongest quarters in Ohio credit union history with $487 million in these loans.
  • In Ohio, credit unions' auto loan balances grew 6.3% annually. Used-auto loan balances for the state rose 9.2% annually, with new-auto balances rising 1.2% during the year.  Despite competition returning to the market, Ohio credit unions' share of the auto loan market improved to  12.5%--up from 12.2% in 2010. (For comparison, credit unions nationally have seen their market share drop to 14.6% by year-end 2011 from 15.2% in 2010.)
  • In membership, Ohio credit unions added nearly 12,000 members, with more than 6,400 arriving during fourth quarter following momentum from Bank Transfer Day on Nov. 6, the day designated for bank customers dissatisfied with bank fees to switch to smaller, local institutions including credit unions. The influx added up to annual growth of 44 basis points, slower than the national average of 1.4%.

Studies Social presence not enough need dialogue

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SAN FRANCISCO (5/16/12)--Although interacting through social media provides solid benefits for consumers and marketers, they also expect more engagement and interaction from brands, a recent social survey by Lithium technologies found.

Social media influence consumers but they expect a two-way dialogue with product brand across the social Web, the study said. For credit unions, this means social media they use must be interactive with a response feature.

The study found that while 25% of those surveyed expect to hear back from a company, when they tweet, 9% actually received a response.

Also, 35% of survey respondents said they expect to hear back from a company after "liking" a brand on Facebook. However, 58% say they never received a response from a company after indicating "liking" it.

A separate survey of marketer attitudes about social media, conducted by Lithium and MarketingProfs in April, found that for marketers surveyed:

  • 74% said creating a community around their brand is a social media business objective, but only 18% of marketers said their company has an online community;
  • 86% indicated they actively use Facebook in their marketing efforts, but only 2.8% reported that when fans "like" their brand on Facebook, it results in better quality interactions;
  • 42% said they are very concerned about demonstrating the value of social media to executive management, but only 4% said their ability to measure the overall impact of social media is excellent; and
  • 31% stated that customer retention is quite important, but only 4.6% of marketers said they are able to measure customer satisfaction extremely well.
An example of how one credit union is using interactive social media can be seen at Catholic Vantage FCU in Livonia, Mich.  

The $73 million asset credit union uses social media for more than promotion. In an effort to reach out to members, the credit union uses a Twitter account, which is an interactive way for young members to have a chance at winning park tickets at an area amusement park.

Its tweet poses a question, "Who is your savings hero?" Members share who they look up to financially through savings, the credit union says. And the question is a good way to get young people to think about the importance of savings and who they can model themselves after, the credit union added.

For children up to 14, Catholic Vantage Financial offers a super saver coloring sheet and savings word search as an age appropriate way to enter the amusement-park ticket drawing.

On the new Twitter account, Catholic Vantage also updates with leads to news stories and relevant blog posts. Some posts may be linked back to the active Facebook page. Throughout the year, it will provide other prompts for younger members to respond to, as a way to keep them informed and interacting with their community.

For members without a Twitter account, the same opportunity is available through the Facebook page. Members can share who their savings hero is on the page's wall for the same chance to win a prize. The Facebook page also is updated frequently with new information on mortgages, recent auto trends, finance news and other happenings at Catholic Vantage Financial.

PCUA Study on trust in local FIs an opportunity

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STATE COLLEGE, Pa. (5/16/12)--A Penn State University study that indicates consumers have more trust in local financial institutions may present an opportunity for credit unions.

A survey of State College, Pa., residents found that 52% of respondents trust local financial institutions more than Wall Street banks (Centre Daily Times May 15).

In a telephone survey of more than 400 State College-area residents, 50% of respondents trust their bank "to do what is right," regardless of the bank's size. But the informal survey found 25% of those who participated held the opposite opinion, and the remaining 25% had neither a favorable nor unfavorable opinion of banks' trustworthiness.

Penn State assistant professor Marcia DiStaso, who teaches marketing and public relations in the College of Communications, said consumers have a big issue with trust and banks, but also have a natural inclination to trust local financial institutions more than Wall Street.

That attraction to local financial institutions is an opportunity for credit unions, said Diane Powell, a spokeswoman with the Pennsylvania Credit Union Association, in the article.

Credit unions are structured to put the interests of their entire memberships before profits, Powell said. They are member owned and any excess revenue is shared among the membership, she explained.

Credit unions have more members and total assets than any time in history, Powell said. Many consumers have recently left their banks in protest over increased fees, she said.

But nontraditional competitors have also entered the marketplace, she added. Costco now offer its members mortgages through a third party. Walmart has added cash centers in its stores where customers can cash checks, get prepaid debit cards and wire money.

With stores nationwide, Costco and Walmart have branch networks already in place, Powell said.

Also, Facebook and Google are creating their own versions of electronic currency, she added. With these new competitors, the traditional concept of a banks account is changing, Powell said.

To read the article, use the link.

Illinois CUs honor lawmakers set priorities

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NAPERVILLE, Ill. 5/16/12)--More than 110 credit union officials statewide joined the Illinois Credit Union League (ICUL) for its annual Legislative Day event in Springfield last week to honor lawmakers and set legislative priorities.

Pictured at the Illinois Credit Union League (ICUL) annual Legislative Day in Springfield last week were, from left: Dan Plauda, ICUL president/CEO; Illinois State Rep. Joseph Lyons, (D-Chicago), assistant majority leader, and board member of Credit Union 1, Rantoul; Illinois State Rep. Lisa Dugan (D-Kankakee) and board member of Riverside Community CU, Kankakee; Keith Sias, ICUL vice president, state governmental affairs; and Steve Olson, ICUL executive vice president, general counsel and chief operating officer. (Photo provided by the Illinois Credit Union League)
Illinois State Treasurer Dan Rutherford provided keynote remarks. During his state legislative career, Treasurer Rutherford was a strong credit union supporter. At the event, he discussed the vital role credit unions play in the financial market and offered an update on the financial challenges facing members of the Illinois General Assembly (IGA) as they prepare the state's budget this session.

National Credit Union Administration (NCUA) board member Michael Fryzel discussed key regulatory developments impacting the credit union movement. 

As part of a luncheon, recognition of credit union champions state Rep. Joseph Lyons (D-19), assistant majority leader, and state Rep. Lisa Dugan (D-79), who will retire from the IGA after this spring session. Both lawmakers have been active on the boards of their credit unions, Credit Union 1, Rantoul, and Riverside Community Credit Union, Kankakee, respectively.

ICUL has been actively lobbying about more than 80 bills that could impact credit unions and their business operations. Of those bills, seven are supported by the league. The rest ICUL opposes or have been modified to allow a neutral position.

These include:

  • S.B. 3217: Illinois Credit Union Act amendments.  S.B. 3217 clarifies that the surviving credit union in a merger is a successor-in-interest and may enforce mortgages and other loans acquired from the merging credit union. It also addresses board authority to establish age eligibility voting standards, and membership status if a member doesn't have at least one fully paid share.  S.B. 3217 passed the Senate unanimously on March 22 and is on third reading in the House.
  • S.B. 2939: Fee caps/restrictions on reloadable debit cards. As a result of grassroots efforts by Illinois credit unions, as well as ICUL leading a coalition of lenders, retailers, and card issuers, S.B. 2939 was not called for a vote and is now essentially "dead," said the league. The measure would have adversely affected credit unions by establishing government fee restraints and other restrictions on reloadable general-use prepaid debit cards beyond the parameters of the federal Credit Card Accountability, Responsibility, and Disclosure Act.
  • Mortgage foreclosure bills: S.B. 2534 (Support)/S.B. 16 (Oppose). More than 50 bills relating to the mortgage foreclosure crisis were filed during the Spring Session of the IGA.  ICUL has been actively involved in efforts to provide meaningful relief to Illinois homeowners impacted by the foreclosure crisis, without burdening the financial services industry. ICUL's approach is to attempt to "fine-tune" the mortgage foreclosure process, rather than penalize lenders (and ultimately borrowers) through increased fines and penalties. These two competing bills are moving through the legislature and address foreclosures in different ways. ICUL supports S.B. 2534, which will create a "fast-track" mortgage foreclosure process for properties that are deemed to be abandoned. S.B. 2534 has passed committee and is on its second reading in the Senate. The Senate third reading deadline for the bill was extended until May 25.
The IGA is scheduled to adjourn on May 31.

Georgia survey Students put off first home to pay debt

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DULUTH, Ga. (5/16/12)--More than one in five respondents (21.8%) to a Georgia Credit Union Affiliates 2011 Year-End Consumer Survey indicated that they have existing student loans.

Of those loans, 10% have a balance of more than $20,000 and 7.6% of respondents with existing student loans said they are not on track to pay back their debt, according to the Georgia Credit Union Affiliates (Consider This … May 1).

The Georgia survey reflects a nationwide trend. Student loan debt recently passed the $1 trillion mark, according to the Consumer Financial Protection Bureau. The Federal Reserve Bank of New York reports that Americans 60 years of age and older owe about $36 billion in student loans and more than 10% of those loans are delinquent.

Experts say that many young people are putting off the purchase of a first house and other major life decisions based upon their need to pay off their student loans.

Brian Akin, president of North Georgia CU in Toccoa, Ga., said he has seen student loan activity increase in recent years, especially among young people starting their careers.

"We see so many college graduates with mortgage-sized student loans and they are frustrated when they can't afford the new car or house they thought would come so easily after college," said Akin.

Although there is no easy answer to avoiding the trap of student loan debt, Akin suggested that students consider working their way through school to limit the amount of student loans. "In the long run, the wisest course of action is to live frugally for a while right out of college to get the debt paid as soon as possible," he said.

CU System briefs (05/15/2012)

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  • (5/16/12)--SURPRISE, Ariz. (5/16/12)--Police are searching for a man who allegedly robbed Deer Valley CU, Surprise, Ariz., wearing women's clothing and clown makeup (Arizona Republic May 13). The man, who was also wearing a large-brim hat, made off with an undisclosed amount of cash after handing over a note demanding money to a credit union teller, according to police. He fled the scene on foot ...
  • ALBANY, N.Y. (5/16/12)--The Credit Union Association of New York (CUANY) earned five awards for its marketing and communications work, including three 2012 Communicator Awards and two 2012 Hermes Awards. The Communicator Awards are judged and overseen by the International Academy of the Visual Arts (IAVA), a member organization of leading professionals from various disciplines of the visual arts. The association received a Communicator Award of Excellence and a Communicator Award of Merit in feature article writing for articles that appeared in the association's quarterly magazine, Connection. CUANY also received a Communicator Award of Merit in print advertising for Covera's CO-OP ATM network advertisement series. The Hermes Creative Awards is an international competition administered and judged by the Association of Marketing and Communication Professionals. The association received a Platinum Award for Connection, and a Gold Award for Covera's CO-OP ATM network advertisement series ...
  • HARRISBURG, Pa. (5/16/12)--John F. King, left, CEO of Philadelphia-based Eagle One FCU, was re-elected to the board of the National Council of Postal Credit Unions during its Annual Conference in Charleston, S.C., last month, according to the Pennsylvania Credit Union Association (Life is a Highway May 15). King, who has been CEO of Eagle One since 2001, will serve his second term as chairman of the organization. King is shown with Patrick Donahoe, right, postmaster general and CEO of the U.S. Postal Service. (Photo provided by the Pennsylvania Credit Union Association) …
  • BYRON, Minn. (5/16/12)--Minnesota credit unions met with U.S. Rep. Tim Walz (D-Minn.) during an event for the congressman on May 11 at First Alliance CU, Byron, Minn. The event was coordinated by the Minnesota Credit Union Network (MnCUN).  Walz spoke to the group about several topics including challenges faced by credit unions.  He focused on regulatory compliance demands expected of financial institutions, agreeing that the growing list of rules and regulations can be burdensome. He noted the important role small businesses can play in continuing economic improvement. "Congressman Walz has been a supporter of credit unions and their MBL (member business lending) legislation," said MnCUN Political Advocacy Director Ryan Smith.  The Credit Union National Association and credit unions are urging Congress to pass S.B. 2231, which would raise the MBL cap to 27.5% of assets from 12.25% so credit unions can inject $13 billion in small business loans into the economy and help create 140,000 jobs, with no cost to the taxpayer. (Photo provided by the Minnesota Credit Union Network) …
  • HARRISBURG, Pa. (5/16/12)--Two Pennsylvania credit union movement leaders are among 25 professional women honored Friday as the Central Penn Business Journal's Women of Influence for 2012, according to the Pennsylvania Credit Union Association (Life is a Highway May 14). They are, from left:  Diana Roberts, president/CEO of Hershey FCU, Hummelstown, and Carol Fastrich-Aranos, vice president of marketing at AmeriChoice FCU, Mechanicsburg. Joining them at the luncheon was PCUA President/CEO Jim McCormack and Mike Wishnow, PCUA senior vice president, plus colleagues and directors from their credit unions.  Fastrich-Aranos is a member of the board of the Pennsylvania Credit Union Foundation. Roberts serves on the association's board and is past board chairman. She is also a former member of the Credit Union National Association board. (Photo provided by the Pennsylvania Credit Union Association) …

CU System briefs (05/14/2012)

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  • MADISON, Wis. (5/15/12)--Two men charged with robbing a Waunakee, Wis., branch of Madison, Wis.-based Summit CU on Aug. 29 were sentenced to prison terms in a U.S. District Court in Madison. Tyree Anthony Walker, 33, Madison, was sentenced to 12 1/2 years after pleading guilty on Feb. 17 to the robbery. On Monday, Gregory Calvin Taylor, 41, Fitchburg was sentenced to 19 1/2 years for bank robbery and possessing a firearm as a felon. Taylor is also facing a mandatory 14-year parole revocation sentence, which will be served consecutive to the robbery sentence. During the heist, Taylor allegedly entered the credit union wearing a ski mask and carrying a gun, and forced a member who was leaving to return to the credit union at gunpoint. He allegedly then jumped the teller counter and stole money from teller drawers. He fled to a getaway car allegedly driven by Walker. After a high speed, 10-mile chase and a brief foot race, they were apprehended (7thspace.com May 14) …
  • HIGHTSTOWN, N.J. (5/15/12)--A job fair today at The Javits Center in New York City that aims to get communities back to work will feature a panel with Geraldo Rivera, journalist and host of "Geraldo"; New Jersey Credit Union League President/CEO Paul Gentile; Barry Sloane, CEO of Newtek, the Small Business Authority (and CUNA Strategic Services provider);  Michael J. Lindell, inventor, MyPillow; and Mike Murphy, senior vice president of operations at QuickCheck. To listen to a recording of Rivera speaking about credit union member business lending and the benefits of joining a credit union, use the link …
  • EAST WINDSOR, N.J. (5/15/12)--McGraw-Hill FCU has introduced Mobile My Deposit, an enhancement to the credit union's mobile appls that allows members to quickly and securely deposit checks via their iPhone or Droid. Members snap a photo of the check using their smart phone and upload it to their savings or checking account. The $278 million asset credit union is among the first to adopted the technology, a head of far larger institutions including Bank of America and Wells Fargo, which haven't introduced the service yet to their customers, said the credit union in a press release …
  • LITTLE ROCK, Ark. (5/15/12)--Woodrow Keown, former chairman of the board of directors for the Federation of Southern Cooperatives, has died at the age of 91. He joined the board in 1969 and served as president and chair for more than 20 years. He was a key figure in organizing the College Station Arkansas FCU and served as its volunteer treasurer/manager for 21 years of the credit union's 28-year history. In 1980 he joined the board of the National Federation of Community Development Credit Unions. He also helped create several organizations that provide housing, literacy and other community services for low-income area …

ABCUL appoints Angus-Crawshaw as new president

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MANCHESTER, Eng. (5/15/12)--The Association of British Credit Unions Ltd. (ABCUL) has named Sharon Angus-Crawshaw of Wales as president for a two-year term.

Angus-Crawshaw, who is also ABCUL director for Wales, has been connected to the Welsh credit union movement for more than 20 years (CreditMan.biz May 14).  She is a director of the Llandudno-based North Wales CU, the largest credit union in Wales with more than US$9.6 million in assets and membership of more than 10,000 adults.

"The credit union scene in Wales is growing in profile and popularity, and my appointment is a compliment of how far Welsh credit unions have advanced in recent years," Crawshaw said in a statement. "People from all walks of life are now realizing that there is an alternative way of banking."

ABCUL is the trade association for credit unions in Great Britain and is a member association of the World Council of Credit Unions.

Michigan unveils new CU media campaign

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LANSING, Mich. (5/15/12)--Michigan's credit unions had a big day Monday. They launched their $2.48 million media campaign, a new CU Link website to "Tap into the power of credit unions," a $10,000 Own Your Money Sweepstakes, and a Facebook and Twitter social media campaign.

The Michigan Credit Union League announced it has invested $3.3 million in media and production costs for the 2012 CU Difference campaign (Michigan Monitor May 14).

The campaign includes:

  • Television ads, which focus on key value propositions including lower fees, higher returns on savings and lower rates on loans. Taglines include: "Get into a better relationship and get into a better rate."  (Use the TV link to view the spots.)
  • Radio spots that focus on selling products--loans, credit cards and free services such as ATMs and checking accounts, and reinforcing credit union's good relationship with members, with: "We never, ever forget whose money it is: Yours."  (Use the link to listen to radio spots.)
  • CU Link website, where consumers can enter a sweepstakes and see details about free checking, low interest rates, shared branching and free ATMs. Each participating credit union also has a profile page to feature several products and drive consumers to their own websites.
  • Collateral materials kits shipped to participating credit unions. Marketing kits include printed and electronic materials such as posters, take ones, lobby displays, window clings, Web banners, newsletter/website content, onhold message scripting, social media postings and e-mail blast copy.
  • The Own Your Money Sweepstakes, which will run through June 27, to create excitement and "buzz." Non-members and members can enter to win a $10,000 grand prize. Also they can be eligible for more than 1,000 instant prizes totaling $20,000 by watching a member-focused video. Credit unions promote the event to drive consumers to watch the video by using the marketing materials.  The sweepstakes winner will be drawn around July 2.
  • Facebook and Twitter pages, to reach younger members. Credit unions will regularly monitor and respond to follower inquiries related to financial questions, liking the updates, commenting on posts, sharing posts and starting conversations.
For more information, use the links.

Thirteen to crash first AVCU meeting

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MONTPELIER, Vt. (5/15/12)--Thirteen employees representing eight Vermont credit unions will attend their first Association of Vermont Credit Unions (AVCU) Annual Meeting this weekend through AVCU's inaugural Crash the Convention program.

The program attempts to get the next generation of credit union leaders more involved in the movement. The 13 Crash participants will learn new ideas during Saturday's educational presentations, interact with their peers from other credit unions, and meet and socialize with veteran leaders of Vermont's credit union movement (AVCU's Newslines Express May 11).

ACVCU said it hopes regular annual meeting attendees will reach out to the Crash group with advice, inspiration and help as they seek new experiences and new acquaintances. 

The 2012 Crash group comprises:

  • Hannah Etli, Central Vermont Medical Center Inc. CU, Berlin;
  • Wil Mobus, Green Mountain CU, South Burlington;
  • Sara DeLance and Megan Kuczynski-Bort, Heritage Family FCU, Rutland;
  • Leandra Lewellyn and Brandi Williams, Members Advantage Community CU, Barre;
  • Jami Blair and Kayla Robinson, NorthCountry FCU, South Burlington;
  • Ashlynn Clapperton, Nathan Cobb and Ben Drugg, One CU, Springfield;
  • Celina Ayers, River Valley CU, Brattleboro; and
  • Karen Rogers, White River CU, Rochester.

NWCUA Idaho league offer pro op-ed on MBL cap lift

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BOISE, Idaho and FEDERAL WAY, Wash. (5/15/12)--Credit unions could be more helpful to small businesses and help create more jobs if Congress were to pass Senate Bill 2231 and its companion bill, according to a Sunday editorial by the Northwest Credit Union Association and Idaho Credit Union League co-written in The Spokane-Review.   

"Senate Bill 2231 and a companion bill in the House of Representatives would raise the credit union business-lending limit from 12.25% of assets to 27.5%," wrote Debie Keesee, vice chair of the Northwest Credit Union Association and CEO of Spokane (Wash.) Media FCU, and  Alan Cameron, CEO of the Idaho Credit Union League.

"These common-sense bills allow credit unions to lend more money to businesses that need it," they added. "The Credit Union National Association (CUNA) estimates Washington and Idaho would see nearly $477 million in new business credit, enough to create more than 5,000 jobs."

The two provided specific examples of consumers who turned to credit unions to help them with their small businesses through: restructuring loans for lower interest rates, issuing loans for a business expansion, and providing funds for a business to diversify its offerings.  

"With Congress' help, credit unions can continue to assure a strong future for local entrepreneurs and the people they employ, and pave the way for even more jobs and more strength in our local economies," concluded Keesee and Cameron.

An editorial offering a counter-point that claims every loan that a credit union makes deepens the deficit for taxpayers was written by Dawn Justice, president/CEO of the Idaho Bankers Association.

CUNA said that increasing the member business lending (MBL) cap 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 editorials, use the links.

Fort Wayne CUs offer small loans to people in a bind

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FORT WAYNE, Ind. (5/15/12)--An article in The Journal Gazette describes how Fort Wayne, Ind., area credit unions are making small loans to help members hit with financial difficulties.

General CU, Fort Wayne, is expanding its mini-loan program because small loans are often the only way members can pay for unforeseen emergencies, such as dental work, car repairs or a blown furnace, said Kathy Knight, the credit union's vice president of business development and marketing.

The credit union makes about 15 to 20 small personal loans a month, Knight told The Journal Gazette.

For example, General CU loaned member Tom Golden $500 to help him pay a $1,000 bill to have a tree removed from his property.

General CU doesn't charge a loan application fee.

The $80 million credit union can't afford a marketing program to tout its lending program, so it provides brochures to a local service provider to pass along to clients needing financial assistance.

Randy Rolf, owner of Randy Rolf & Sons Heating and Cooling, has referred clients to the credit union for about three years.

Some service providers work with finance companies to help customers pay bills, but Rolf said he would rather work with General CU. His customers can contact the credit union directly and are provided more privacy with their financial information.

General CU offers a 7.99% interest rate to qualified borrowers for a two-year loan.

No amount is too low, Nancy Brandenberger, General CU's vice present of lending told the newspaper.

MidWest America FCU, with $466 million in assets, Fort Wayne, was also cited in the article for making home improvement loans to members.

To read the article, use the link.

Connecticut CUs assist first Trinidad Reality Fair

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MERIDEN, Conn. (5/15/12)--Representatives from the Connecticut International Partnership Committee of the Credit Union League of Connecticut learned that assisting youth with learning how to handle finances is universal, during a Financial Reality Fair April 30 in San Fernando, Trinidad.

Michele Wallace, left, finance manager with COPOS CU in Trinidad & Tobago, chose to create a Financial Reality Fair as her project upon graduation from CaribDE (Development Educator). The student on the right is a participant. (Photo provided by the Credit Union League of Connecticut)
Recently designated Development Educator Michelle Wallace, finance manager with COPOS CU in Trinidad & Tobago (TT), chose to create the Financial Reality Fair as her project upon graduation from CaribDE (Development Educator). The Connecticut International Partnership Committee donated a reality fair template based upon the Connecticut program. Volunteers from credit unions in Connecticut worked with Wallace to adapt the program for TT youth.

Going to Trinidad to assist with the inaugural Fair were: Joanne Todd, CEO, Northeast Family FCU, Manchester; John Keet, CEO, Personal Care America FCU, Trumbull; Carol Bayreuther, CEO, Hartford (Conn.) Healthcare FCU; and Barb Bass, vice president, Credit Union League of Connecticut. Keith Wiemert, CEO, Seasons FCU, Middletown, and Kathy Chartier, CEO, Members CU, Cos Cob, who were in Trinidad attending the CaribDE program, stayed and also assisted the partner credit unions.

CUNA Mutual's Gerry Singleton--also a recent CaribDE graduate and volunteer at Financial Reality Fairs during the Credit Union National Association's Governmental Affairs Conference (GAC) in Washington D.C.--joined in to assist.

"This Financial Reality Fair was a success on so many levels," Chartier said. "Cooperation among cooperatives, collaboration between international partners, the Connecticut Reality Fair Program going global with adaption, and a CaribDE completing her project--it all came perfectly together. Bottom line: the biggest success was bringing financial education to the youth of Trinidad and Tobago."

COPOS CU, Neal & Massey CU, and CUNA Mutual Carib partnered to bring the fair to 140 students from six schools in the Port of Spain area. Several other Trinidad credit unions and their business partners, joined to bring the experience to TT students.

"The opportunity to experience a cooperative and collaborative reality fair with credit unions in Trinidad was fabulous," said Bayreuther, whose Trinidad partner credit union, San Fernando Community CU, sent four volunteers to assist in the fair. "The kids were so excited and it was obvious that they took the purpose of the fair very seriously."

The National Credit Union Foundation, through its REAL Solutions program, champions experiential financial learning programs such as reality fairs. It hosts the reality fair at the GAC.

SECUs mortgage foreclosure prevention helps homeowners

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RALEIGH, N.C. (5/15/12)--State Employees' CU (SECU), Raleigh, N.C., has helped nearly 500 of its members receive benefits of $3.1 million through the North Carolina Foreclosure Prevention Fund offered by the state Housing Finance Agency (NCHFA). 

The fund offers a Mortgage Payment Program (MPP) to North Carolina homeowners struggling to make their mortgage payments, due to no-fault job loss or other temporary financial hardship such as divorce, serious illness, or death of a co-signer. 

For those who qualify, the program offers zero-interest loans for a maximum of $36,000 to cover mortgage and related expenses up to 36 months. 

The $23 billion asset SECU's delivery of MPP information complements its Mortgage Assistance Program (MAP), which has helped 8,400 families remain in their homes since early 2009.  MAP was created to assist members facing job loss income reduction by providing foreclosure prevention options such as mortgage extensions, modifications, refinances and partial payment alternatives.

iWash. Posti columnist touts CUs investor program

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WASHINGTON (5/15/12)--A nationally syndicated Washington Post column touts the benefits of the Investor Protection Trust, a workplace investment program initiated by credit union employees.

Columnist Michelle Singletary recalled when she began her journalism career her grandmother urged Singletary to arrange a portion of her paycheck to be automatically deposited to a savings account--preferably at a credit union.

Singletary describes the Investor Protection Trust, a workplace education program that helps employees save. The program began as a pilot in Wisconsin, Pennsylvania and North Carolina with the help of state securities agencies and the National Credit Union Foundation (NCUF).

The institution includes a nine-part, 10-hour online education series on topics such as saving, investing, risk and financial advisers.

The program was initially tested in three states and is expanding to Alaska, Colorado, Iowa, Michigan, Oklahoma, Vermont, Washington, and the District of Columbia.

Lois Kitsch, NCUF national program director, told the Post that the Investor Protection Trust gives would-be savers a place to take the all-important first step in beginning a savings program.

Workplace financial education programs are a good fit because that's where consumers earn their money and are most likely to begin saving and investing, J. Michael Collins, an assistant professor and director of the Center for Financial Security at the University of Wisconsin-Madison, told the Post.

To the read the article, use the link.

CU-backed small claims bill heads to Mich. governor

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LANSING, Mich. (5/ 15/12)--Michigan Credit Union League-backed legislation that would increase Michigan's small claims court threshold has passed the state Senate and is headed to Gov. Rick Snyder for consideration.

SB 269 passed the Senate, 37-0,  on May 8. The House had passed an amended version, 107-2, earlier, said the league (Michigan Monitor May 14).

Introduced by state Sen. Tonya Schuitmaker (R-Antwerp Twp.), the bill provides for an immediate increase of the threshold to $5,000 from $3,000, followed by four $500 increases occurring every three years.  The $5,000 threshold is larger than in 20 other states. It would significantly increase access to small claims court for both consumers and businesses, said the league.

Ringleader sentenced to 18 years in St. Paul Croatian FCU collapse

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CLEVELAND (5/14/12)--The alleged ringleader in the loan fraud scheme that contributed to the collapse of Eastlake, Ohio-based St. Paul Croatian FCU--one of the largest credit union failures in U.S. history--was sentenced Friday to 18 years in prison.

Koljo Nikolovski, 49, of Eastlake and Skopje, Macedonia, had pleaded guilty in the U.S. District Court in Cleveland to obtaining several loans worth about $2.9 million from 2003 through 2005 from the credit union (News-Herald May 12). He originally was charged with 10 counts of bank fraud, three counts of bank bribery and five counts of money laundering.

Nikolovski allegedly enlisted the help of family members, including his ex-wife, Rose Ann Nikolovski, to obtain loans.  They were among 19 people charged in the scheme. which included a county commissioner and the credit union's former CEO, Anthony Raguz.

Raguz, 51, pleaded guilty to six charges related to issuing the loans and accepting more than $500,000 in bribes, kickbacks and gift and is scheduled to be sentenced Nov. 20 (News Now Feb. 28 and May 17). (See related story in News Now's CU System briefs section).

The scheme  involved more than 1,000 fraudulent loans totaling more than $70 million and made to 300 account holders between 2000 and 2010 (News Now Feb. 28 and May 17).

St. Paul Croatian was the one of the largest credit union failures in history, costing the National Credit Union Share Insurance Fund $170 million.  It was placed into conservatorship on April 23, 2010, and closed on the following May 1. At the time of the collapse, the credit union held $238.8 million in funds from 5,400 members.  The collapse prompted lawsuits by the National Credit Union Administration to recoup some of the fund's losses.

Mich. league CEO to receive regional SBA honor

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DETROIT (5/14/12)--Michigan Credit Union League and Affiliates President/CEO David Adams will be among three Michigan small business leaders to receive regional honors from the U.S. Small Business Administration (SBA).

The 2012 Region V Small Business Awards acknowledge achievements on behalf of small businesses in Michigan and through Region V, which includes Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin.

Adams will receive the region's Financial Services Champion of the Year award on Tuesday at the league's office in Lansing. SBA said his innovation and leadership has led to double-digit growth in small business lending among Michigan credit unions.

According to the SBA's press release, "Adams is an important advocate for increasing access to capital for small businesses through his lobbying efforts in both Lansing and Washington, D.C. Working closely with Congressman Gary Peters, Adam played an instrumental role in lobbying for the Small Business Jobs Act of 2010. As a result, Michigan credit union business loans have far outpaced business loan activity as compared to national credit union statistics."

He is also this year's National Financial Services Champion Award Winner and will receive that award from SBA during an award ceremony later this month in Washington, D.C.  See related News Now article "Mich. league CEO is SBA National Fin Services Champion."

Car dealer Albany area CUs tout business loans

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ALBANY, N.Y. (5/14/12)--Some Albany, N.Y., area credit unions are aggressively pursuing small business lending, which has benefited small businesses such as a local hotel and an auto dealership, said The Business Review (May 11).

The Credit Union National Association (CUNA) estimates credit unions account for about 6% of business lending in the nation, reported the Review.  Among those lending are four local credit unions: $2.3 billion asset SEFCU, $364 million asset Sunmark FCU, $906 million asset CAP COM FCU and $241 million asset First New York FCU all offer member business loans (MBLs),

First New York FCU told the publication that it has $4 million in business loans on its books and hopes to increase that this year by several million.

SEFCU has expanded its commercial services business in the past year and has set a goal of lending $70 million this year in MBLs. It already has more than $100 million in the pipeline in various stages as of early May, said Tom Arnell, president of commercial services for SEFCU.

In the past few weeks, it has approved $7 million toward the repurchase and renovation of the historic Adelphi Hotel in Saratoga Springs, and $2.5 million for a new Clifton Park auto dealership, said the article.

Car dealer James Zappone told the Review he had spoken to several banks he had done business with in the past before deciding on SECU to finance his purchase of the Clifton Park property and the building of Zappone Chrysler Jeep Dodge, which he plans to open in June. He noted that the credit union came in wanting to do business.

"They looked at the project and said, 'How can we make this work?'" Zappone said. SEFCU worked with him to get a $4 million U.S. Small Business Administration 504 loan, in conjunction with Albany-based Empire State Certified Development Corp. SEFCU's share was $2.5 million.

It also provided $3.15 million to help purchase the Adelphi Hotel and will provide another $4 million toward renovations.

Although it has a way to go, SEFCU is concerned about reaching the MBL cap, said the article. Its lending cap is $306 million, which means it still has $143 million in wiggle room. It is among the nation's credit unions urging Congress to raise the MBL cap to 27.5% of assets from its current 12.25. Raising the cap would mean that SEFCU could increase its business lending power to $688 million in small business loans, it told the publication.

Nationally, raising the MBL cap would mean credit unions would have an extra $13 billion to inject into the economy through small business loans. That, in turn, would result in 140,000 new jobs the first year, without impacting the taxpayer, said CUNA.

CU System briefs (05/11/2012)

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  • CLEVELAND (5/14/12)--A former county commissioner has pleaded guilty to participating in a loan fraud scheme that contributed to the collapse of the now defunct St. Paul Croatian FCU in Eastlake, Ohio. Former Trumbull County Commissioner Ted M. Vannelli, 66, of Willoughby, Ohio, pleaded guilty in a federal court to two charges of fraud and money laundering. He and his son-in-law, A. Eddy Zai, and a local accountant were among 19 people who have been charged in the scheme, which involved more than 1,000 fraudulent loans totaling more than $70 million and made to 300 account holders between 2000 and 2010. At least half of those charged have been convicted. They include the credit union's former CEO, Anthony Raguz, who allegedly admitted issuing the loans and accepting more than $500,000 in bribes, kickbacks and gifts, and the alleged ringleader, Koljo Nikolovski, who pleaded guilty to fraud and money laundering (TribToday.com May 11 and News Now March 8 and Feb. 28). Nikolovski was sentenced Friday to 18 years in prison, and Raguz is awaiting sentencing (Herald-News May 12). (See related story in today's issue:  "Ringleader sentenced to 18 years in St. Paul Croatian FCU collapse.") St. Paul Croatian FCU was one of the largest credit union failures in history, costing the National Credit Union Share Insurance Fund roughly $170 million ...
  • ALEXANDRIA, Va. (5/14/12)--National Credit Union Administration (NCUA) Board Member Michael E. Fryzel addressed more than 110 attendees at the Illinois Credit Union System's Legislative Conference recently in Springfield, Ill. He updated the group on credit unions and corporates, pending and proposed rules, staff changes, underwriter settlements, pending federal legislation, the future of credit unions, and Illinois credit unions. Fryzel told the group that Illinois has the largest number of federally insured, state-chartered credit unions in the nation. He also highlighted the continued importance of events such as the league's legislative conference. "Your exchange of concerns and ideas coupled with the sharing of the credit union story with elected officials continues to have a positive impact," Fryzel said. (Photo provided by the Illinois Credit Union League) …

Filene CUs MBLs weathered economy better than banks

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MADISON, Wis. (5/14/12)--Allowing credit unions to expand their commercial loan growth not only could help the economy, but also would improve the resiliency of their loan portfolios in times of economic stress, according to a recent Filene Research Institute study. Policymakers should consider relaxing regulatory caps concerning credit union business lending or consider alternative routes to promote that lending, the study concluded.

The study also found that while U.S. credit unions are newer to business lending, their delinquency and charge-off rates compare favorably to those at commercial banks during the past 15 years.

The study, "Commercial Lending During the Crisis: Credit Unions vs. banks" by David Smith, an economist at Pepperdine University's Graziadio School of Business and Management, looks to quantify credit unions' member business lending (MBL) at a time when they seek to widen their access to the business lending market.

Implications for credit unions found by the study are:

  • Credit union commercial loan growth has been steady during the past 15 years from 1996 through 2012. More important, it has been resilient during the last two recessions, suggesting that credit unions can buoy both lending growth and, as a consequence, overall business activity.
  • While banks tend to contract commercial lending during economic stress, the opposite is true for credit unions. Commercial loan growth rates for banks turned negative following the recessions beginning in 2001 and 2007, but credit union growth rates remained positive during both periods.
  • Despite the positive trends noted above, commercial lending, as measured by delinquency and charge-off rates, is more sensitive to the business cycle for credit unions than it is for banks. Yet, the data show that credit unions continue to offer business loans when others retreat.
At a time when the economy needs assistance from any area, credit unions' stable commercial lending history shows they may be a helpful source, said the study.

The study builds on previous research in 2010 by Smith and Stephen Woodbury in "Withstanding a Financial Firestorm: Credit Unions vs. Banks," in which the authors indicated that credit unions are surprisingly resilient to the downside of the business cycle, especially compared with commercial banks. That study indicates credit unions' aggregate loan portfolios appear to be roughly 25% less sensitive to macroeconomic shocks than those of banks, Filene 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 business loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.

For more information, use the link.

Maine league honors five leaders elects board

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Donn Goodwin, right, board chair at Brewer (Maine) FCU, received the Maine Credit Union League's Alexander Ferguson Award for Outstanding Maine Credit Union Volunteer.  He is pictured with Rick Kaul, president/CEO of the credit union.
PORTLAND, Maine (5/14/12)--The Maine Credit Union League recently honored five individuals for their contributions to the success of Maine's credit unions and elected its board for 2012/2013. Recipients were recognized and presented with their awards at a special ceremony held May 4 in Portland in conjunction with the league's Annual Meeting & Convention.

The 2012 Maine Credit Union League award winners are:

Ferguson Award for Outstanding Credit Union Volunteer--Donn Goodwin, board chair, Brewer (Maine) FCU. Goodwin has been involved with the credit union for more than 50 years, first as a member, then as a member of the supervisory committee and, for the past 20 years, as chairman of the credit union's board.

One nomination describing his character said, "This person puts our credit union and the
Roland Poirier, right, president/CEO of Otis FCU of Jay, was recognized with the Maine Credit Union League's James M. Gratto Award for Outstanding Maine Credit Union CEO.  He is pictured with Ronald McAllister, board chair of Otis FCU.
community first." Another nomination added: "This person has been the most vocal supporter of our credit union and in staying true to the credit union philosophy. This person is our most active board member and, as board chair, leads by example."

James M. Gratto Award for Outstanding Credit Union Manager--Roland Poirier, president/CEO, Otis FCU, Jay, is a 35-year employee of the credit union movement, including the past 25 years at Otis FCU. Through his leadership, the credit union has been able to give members a bonus dividend for the past six years. Borrowers and savers have received a combined total of nearly $2.5 million in bonus dividends, which has been especially remarkable during the challenging times of the past few years, the league said.

"While a number of members have stopped by to say 'thank you', we are the ones that are thankful for having built the trust and relationships with
Cindy Giroux, vice president of human resources and marketing at Oxford FCU, Mexico, received the Maine Credit Union League's Jeannette G. Morin Award for Outstanding Maine Credit Union Employee.  She is pictured with Matt Kaubris, president/CEO of the credit union.
our members that makes it possible to pay a year-end rebate and bonus," Poirier said. 

Jeannette G. Morin Award for Outstanding Credit Union Employee--Cindy Giroux, vice president of human resources and marketing at Oxford FCU, Mexico, is retiring June 1, after 13 years with the credit union. She is praised as someone who lives the credit union's philosophy of people helping people every day.

As a member of the credit union's management team, she is recognized as someone who thoughtfully shares her insight and expertise while making sure the human portion of any decision is always the credit union's first priority. She is a tireless advocate of financial education and has been a driving force in helping her credit union educate students and consumers to become more financially successful.

Tucker Cole, left, president/CEO of Evergreen CU,  Portland, was presented the Maine Credit Union League's President's Award for Outstanding League Volunteer by John Murphy, league president.
Maine CU League President's Award for Outstanding League Volunteer--Tucker Cole president/CEO of Evergreen CU, Portland, was honored by league President John Murphy for his leadership role on issues important to credit unions, frequently participating in meetings with lawmakers.

"As CEO of one of Maine's largest credit unions, he makes the time to participate in and support activities not only to improve the lives of members but to improve the operational and political environment for credit unions," Murphy said, recognizing that credit unions are cooperatives. Cole has coordinated activities to encourage local credit unions to work together.

Diane L. Oceretko "People Helping People" Award--Johanna Dorr, loan officer and marketing coordinator at Seaboard FCU, Bucksport, was described as being "so instrumental in all facets of
Johanna Dorr of Seaboard FCU, Bucksport, received the Maine Credit Union League's Diane L. Oceretko "People Helping People" Award for community-service.  Pictured with her is Kyle Casburn, president/CEO of the credit union. (Photos provided by the Maine Credit Union League)
our credit union's community relations that it is difficult to know where to begin to list this person's impact on the many lives this person has touched."

From the beginning, Dorr has been a champion for ending hunger, having been part of the original group that helped to begin the Maine Credit Unions' Campaign for Ending Hunger in 1990. She continues to work to create fundraisers that members look forward to, all the while raising funds for Ending Hunger.  

Also, at the league's 74th Annual Delegates' Meeting, Normand Dubreuil, president/CEO of Maine State CU, Augusta, was re-elected to a new three-year term on the league board. Dubreuil has served on the board since 1997, including as chair from 2001-2004 and, most recently, as league chair of the Technology Services Committee.

Following the Dele­gates' Meeting, the league board elected its new table officers for 2012/2013. The board elected:

  • Chair--Dave Rossignol, president/CEO of NorState FCU, Madawaska;
  • Vice chair--Gail Richardson, president/CEO of Midcoast FCU, Bath;
  • Secretary--James Lemieux, president/CEO of Sebasticook Valley FCU, Pittsfield; and
  • Treasurer--Richard Lachance, president/CEO of Maine Education CU, Augusta.
 

After the league's Annual Meeting and Convention, the league board voted to change the location of next year's convention from Augusta to Port­land (Weekly Update May 11).

Mayor announces fin ed grant teams with Conn. CUs

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BRIDGEPORT, Conn. (5/14/12)--Bridgeport, Conn., Mayor Bill Finch last week announced a $15,000 financial education grant from the U.S. Conference of Mayors and a resulting partnership with the Credit Union League of Connecticut.

Bridgeport, Conn., Mayor Bill Finch last week announced a $15,000 financial education grant, to be used in partnership with Credit Union League of Connecticut. The grant was one of five awarded nationally by the U.S. Conference of Mayors. From left, John E. Keet Jr., CEO, Personal Care America FCU, Trumbull; Finch; and Tony Emerson, president/CEO of the Credit Union League of Connecticut. (Photo provided by Credit Union League of Connecticut)
The announcement was made at a financial reality fair sponsored by Connecticut credit unions at Housatonic Community College in Bridgeport.

The grant, one of only five awarded nationally by the Conference of Mayors, was applied for by the Bridgeport mayor's office in partnership with the league, with assistance from the office of  U.S. Rep. Jim Himes (D-Conn.) and John E. Keet, Jr., CEO of Personal Care America FCU, Trumbull. It is intended for financial education in the Bridgeport area. Future events will include education for middle school students and low-income adult residents.

The financial reality fair was the first event funded by the grant, said the league. More than 600 students from 12 schools paced their way through realistic budgets to see how well they might manage financially if they were out of school and on their own.

The fair was staffed by 104 volunteers, mostly from Connecticut credit unions, the league and its business associates.

CUs have best reputation of any sector--survey

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DENVER (5/14/12)--Credit unions were rated No. 1 in a new survey in which 5,000 consumers were asked to rate the reputation of 34 business sectors.

Click to view larger image Click for larger view
Consumers were randomly asked in the survey, conducted by Denver-based Prime Performance, to rate the reputation of five of the 34 sectors using a scale where "one" is "a very bad" reputation and "seven" is a "very good" reputation.

Excluding sectors unfamiliar to them, consumers gave more than 23,000 ratings.

Credit unions topped all business sectors in reputation with an average reputation score of 5.78, followed by grocery stores (5.50), and community banks (5.40). Regional banks came in seventh at 5.04 and national banks 18th at 4.15. Financial advisers were ranked 14th. Consumers gave the banking industry an average score of 3.98, ranking 24th. Overall, the financial services industry ranked 21st.

The bottom five sectors were the mortgage industry, 3.35; the federal government, 3.30; oil and gas industry, 3.26; Wall Street firms, 3.09; and the tobacco industry, 2.71.

Credit unions have consistently rated strong on customer satisfaction indices.

In 2011, credit unions set an all-time American Customer Satisfaction Index (ACSI) record, with 87% of credit union members surveyed saying they are "more satisfied than ever before" with their credit unions. The 87% score was the highest score reached in any of the ASCI's 47 industries that it surveys (News Now Dec 14, 2011).

A survey of 10,000 U.S. consumers about their loyalty to 206 large companies across 18 industries showed only seven companies have "very strong" loyalty ratings. Credit unions ranked No. 5, just behind  Sam's Club, Aldi, USAA, and Publix and ahead of Amazon.com, and H.E.B. (News Now March 21). The survey was released earlier this year by the Temkin Group.

The 2011 Northeast U.S. Bank & Credit Union Customer Experience Survey, also conducted by Prime Performance, rated credit unions as the overall leader with a Prime Experience Index (PXI) of 79%, well ahead of the overall bank average of 59%  (News Now Jan. 5).

Duchess of Cornwall makes first visit to CU

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EDINBURGH, Scotland (5/14/12)--Camilla, the Duchess of Cornwall--also known as the Duchess of Rothesay in Scotland-- paid a visit Wednesday to Edinburgh-based Capital CU and proclaimed a fascination with credit unions.

Camilla, the Duchess of Cornwall and Rothesay, stopped by Capital CU, Edinburgh, Scotland, Wednesday to learn about the work credit unions do and promised to help "spread the word" about them. (Photo provided by Capital CU)
It was the first time she has visited a credit union in Scotland. She praised the credit union's work to increase financial inclusion (serve the unbanked) and money management skills in disadvantaged communities, the credit union said on its website.

The Duchess met staff and members to hear about the work they do. "I did learn a lot today and am fascinated by the credit union movement. It is important to get the message out to people that these organizations are here, and I will do my best to help spread the word," she told the credit union.

One person to meet the royal visitor was Robert McEwan, who said Capital CU has helped finance his son's boxing career. He is the father of Craig McEwan, a world renowned professional middleweight fighter based in Hollywood, Calif.  McEwan told the Duchess about his son's career and that his son is currently part of the Golden Boy Promotions stable run by the legendary U.S. boxer, Oscar De La Hoya.

Marlene Shiels, Capital CU CEO, said that the Duchess "has a particular interest in the work of credit unions in their communities and the importance of money management, and this was a great opportunity for us to showcase the tremendous work that we do in this area."

As she departed, the royal visitor was given an application form to join the credit union, which she promised to "study carefully."

The duchess and her husband, Prince Charles, will be visiting Canada next. For more information about the visit, use the link to Capital CU's website.

CU System briefs (05/10/2012)

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  • WASHINGTON (5/11/12)--The Internet Crime Complaint Center (IC3) is alerting people traveling abroad that laptops have been infected with malicious software while travelers use hotel Internet connections.Travelers attempting to set up a hotel room Internet connection receive a pop up window that offers a seemingly routine update to a legitimate software product for which updates are frequently made. If the traveler clicks on and accept the update, the malware installs on the laptop. The Federal Bureau of Investigation recommended taking extra caution before updating software in this situation. Check the author or digital certificate of any prompted update to see if they are legitimate. Also perform software updates on the laptops immediately before travelling and download software updates directly from the vendor's website …
  • MADISON, Wis.(5/11/12)--Brian Nelson has been promoted to senior vice president and chief financial officer (CFO) of the Credit Union National Association (CUNA), announced CUNA President/CEO Bill Cheney Thursday. Nelson had been serving as interim CFO since late last fall. He succeeds Joanne Duncan. Nelson began his career with CUNA Finance in April 1988. Prior to his becoming interim CFO, he was vice president of Finance. As part of CUNA's senior management team, Nelson will direct and administer the trade association's overall financial plans, business policies and accounting practices …
  • NEW YORK (5/11/12)--The New York Coalition of Community Development Financial Institutions, operated and staffed by the National Federation of Community Development Credit Unions, will host its fifth Annual Statewide Conference for New York's community development financial institutions (CDFI) on May 14-15 in Albany, N.Y. The meeting's theme is "New York CDFIs: Impact Where it Matters Most." …
  • PORTSMOUTH, N.H. (5/11/12)--Service CU in Portsmouth, N.H., reports it has surpassed the $2 billion assets milestone as well as a record high worldwide membership of 164,000. In January, 1957, eight men established the credit union on Pease Air Force Base to serve soldiers and their families stationed there. In the past 18 years it has grown from a $282 million asset credit union to $2.08 billion--an increase of more than 600% in two decades (fosters.com May 9) …

Study CUs best practices on credit cards prevent loss

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DURHAM, N.C. (5/11/12)--Credit card issuers who make their pricing unclear and are more aggressive in their marketing ended up eating more losses during the recession, according to a new study.  But issuers with "best practices"--which tended to be credit unions and community banks--had fewer losses, the report said.

The study, "Predatory Credit Card Lending: Unsafe, Unsound for Consumers and Companies," was conducted by Joshua M. Frank, senior researcher, at the Durham, N.C.-based Center for Responsible Lending. The study examined 23 practices in marketing and pricing that were common among the top 100 credit card issuers, based on managed credit card loans, in the summer of 2009 before implementation of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act.

Best practices included more transparency and straightforward pricing that were less dependent on complex fee policies, said the study.

Among the findings:

  • A credit card issuer that engaged in one unfair, deceptive or abusive tactic tended to engage in many. "In general, smaller banks and credit unions had better practices," said the report's executive summary.
  • Bad practices were a good predictor of complaint levels. The study correlated complaints to the Better Business Bureau with specific practices, regardless of the institution's type or size.
  • The more obscure an issuer's pricing and the more aggressive its marketing, the more its losses jumped during the recession. In fact, credit card practices were the best predictor of how quickly losses would mount compared to competitors' losses--better than a lender's location, type or size.
  • Credit card issuers' claim that high-cost penalty fees and interest were risk-management tools is false. Risk-management practices didn't explain the correlation between unfair, deceptive or abusive practices and accompanying increases in losses. "That's because these fees and rates didn't mitigate risk, they were the risk,'" said the study.
  • The larger the financial institution was that engaged in deceptive or misleading practices, the worse the practices tended to be. "In general, regional or smaller banks or credit unions tended to have clearer, fairer pricing," the report said.
  • A strategy of maximizing short-term revenue by using unfair, deceptive or abusive lending practices led to a higher risk and lower profits during the [economic] downturn, undermining a bank's safety and soundness.
  • Card issuers' claim that consumer protections have the unintended consequence of undermining the safety and soundness of financial institutions is wrong. "Common sense curbs on abusive lending practices increase market transparency and bolster firms' financial strength," the report concluded.

Auto leases growth rate twice that of auto loans

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ATLANTA and NEW YORK (5/11/12)--Total U.S. auto lease balances rose 9% in March over a year ago, more than twice the growth rate of auto loan balances, which grew 4.2% during the same period, said a study conducted by Equifax and Moody's Analytics' CreditForecast.com.

The data indicate that most consumers looking to buy a new car are still financing their purchases with loans, rather than leases, but lease volume is increasing rapidly, said CreditForecast.com, which provides consumer credit data and forecasts.  It forecast that leases could grow about 50% by the end of 2017.

This could impact auto loan portfolios at credit unions, since leases are mostly originated by auto finance companies. If leases grow at auto finance companies, that means fewer auto loans for other lenders such as credit unions.

At credit unions, new auto loans in March represented 10.1% of their loan portfolio, a decrease from 10.8% in March 2011, according to the Credit Union National Association's Monthly Credit Union Estimates. Used-auto loans represented 18.7%, compared to last year's 18% of credit unions' loan portfolio.

Lease balances originated by auto finance companies rose 11% in March from March a year ago, and those balances are expected to grow at an 8% average annual rate through the end of 2017. Auto loan balances, however, are expected to increase between 2% and 3% annually during the same period.

"Auto finance companies have ramped up the number of leases they are providing to well-qualified borrowers with higher credit scores," said Amy Crews Cutts, senior vice president and chief economist of Equifax.  She noted leases are growing in particular in California, Florida and the Northeast.

"Growth in originations by auto finance companies will drive further expansion in lease balances over the next five years," said Dr. Cristian de Ritis, director of consumer credit economics at Moody's Analytics. "Auto finance companies, who issue the large majority of auto leases, are more sensitive to the growth of the U.S. Economy, and as the economy grows, they are likely to grow their auto lending originations faster than banks will," de Ritis said.

Lease financing represents 10% of all U.S. auto lending provided by finance companies, which originate just over half of all U.S. auto credit.  Financing from banks and credit unions comprise the remaining portion of auto lending.Drive a Bargain on Your Next Car drive-up envelope

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Take the Wheel: Get the Best Car Deal member seminar kit

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What Beats 0% Financing? drive-up envelope

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SunCorp adds 26 new member CUs

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WESTMINSTER, Colo. (5/11/12)--System United Corporate FCU (SunCorp) in Westminster, Colo., announced the addition of 26 new member credit unions from the Western states--including 19 from California--during the first four months of this year.

The new members cited SunCorp's financial position, management team, Western presence and personal service as reasons for joining, the corporate said.

"Our member-focused business development and implementation staff has done a great job receiving and serving our newest members," said Thomas R. Graham, president/CEO.

SunCorp transitioned the new members from Western Bridge Corporate, with an average conversion time of 38 business days, including three conversions that were completed in less than 30 business days.

SunCorp is adapting to meet the needs of the new members by extending service hours and transaction deadlines to better serve those in the Pacific Time Zone.

The corporate also has opened new relationships with Western Vault and courier providers to serve member credit unions' coin and currency needs.

Appeals court upholds NCUAs foreclosures from defunct CUs

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LAKELAND, Fla. (5/11/12)--An appeals court in Florida has upheld a decision allowing the National Credit Union Administration's (NCUA) foreclosures of 17 homes involved in distressed land deals made by defunct Huron River Area CU in Michigan.

The ruling was issued Wednesday without comment in the District Court of Appeals of Florida, Second District in Lakeland.

NCUA had asked a lower court to dismiss claims of at least 27 borrowers from nine states who invested in real estate in southwest Florida and whose loans were held by the now-defunct Huron River Area CU (News Now Oct. 5, 2011).

NCUA, as liquidating agent for the credit union, had begun foreclosure proceedings on mortgages made by the borrowers, who invested in the undeveloped Cape Coral and Lehigh Acres projects in Florida, which went bust when the real estate market bottomed out.

In the 2011 ruling, U.S. District Judge Charlene Edwards Honeywell indicated that the group of borrowers had raised seven new valid arguments about the credit union's relationship with Construction Loan Co. and Whitney Education Group, which conducts real estate investment seminars under the name "Millionaire University."

In defending against the summary motion, the borrowers noted they were not asserting a right to payment but merely were asserting to defeat NCUA's foreclosure action.

NCUA assumed control of the $360 million asset credit union in February 2007 and liquidated it on Nov. 18, 2007.

The credit union is one of three credit unions--the others being Fort Collins, Colo.-based Norlarco CU and Denver-based New Horizons Community FCU--that provided the mortgage construction loans (News Now Sept. 16, 2009).

Pa. House committee passes short-term loan bill

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HARRISBURG, Pa. (5/11/12)--The Pennsylvania House Consumer Affairs Committee voted short-term lending legislation, H.R. 2191, out of committee Wednesday, said the Pennsylvania Credit Union Association (PCUA).

The legislation, sponsored by State Rep. Chris Ross (R-Chester), requires persons making short-term loans or renewing loans to obtain a license from the state Department of Banking (Life is a Highway May 10).

The bill also outlines requirements for short-term lenders, protections for consumers, and establishes a state Financial Literacy Account within the Pennsylvania Banking Department Fund.

Committee Chairman Bob Godshall (R-Montgomery) noted the department submitted a letter to the committee supporting the bill. This proposal would implement the most stringent payday lending regulation in the country, Godshall added.

PCUA attended the meeting and will follow up with a few legislators who have questions about the Credit Union Better Choice program, the association's short-term loan alternative to payday loans.

Maine CUs logged 35000 volunteer hours in 2011

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PORTLAND, Maine (5/11/12)--Maine credit unions volunteered a record 35,008 hours last year--a 13% increase over 2010, the Maine Credit Union League has announced.   

The league issued a report that coincided with the conclusion of National Volunteer Week, April 15-21 (Bangor Daily News May 8).

More than 2,000 people, including credit union staff and board members, volunteered in their communities in 2011, said the league, which coordinated the tracking program Credit Unions Share for ME. Each month last year, an average of 318 credit union staff and directors collectively volunteered nearly 3,000 hours.

The value of time volunteered by Maine's credit unions equaled $590,000 last year, based on figures provided by the U.S. Bureau of Labor Statistics, which calculates the value of one hour volunteered in Maine at $16.84.

The program started in 2002.  Since then, credit union staff and volunteers put in more than 215,000 volunteer hours. 

To read the article, use the link.

Mountain America CU expands into Idaho

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WEST JORDAN, Utah (5/11/12)--Mountain America FCU, based in West Jordan, Utah, is expanding its presence in Idaho, after opening its first branches in the state last year.

Mountain America FCU, with $2.9 billion in assets, has purchased a former Home Federal Bank branch building in Boise, Idaho (Idaho Business Review May 2). Remodeling of the facility is expected to begin by the end of June, Jason Rogers the credit union's vice president of branch administration told the paper.

The new branch is set to open by the end of the year with six or seven employees, Rogers said.

Mountain America has a concentration of members in the Boise area, Rogers said.

Many of Mountain America's Idaho members include people who moved to the state after completing college in Utah, he added.

Wisconsin state-chartered CUs show growth in 1Q

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MADISON, Wis. (5/11/12)--Wisconsin's state-chartered credit unions showed increases in net income, total assets and return on assets (ROA) in the first quarter of 2012, according to data compiled by the Wisconsin Department of Financial Institutions (DFI).

Wisconsin's 199 state-chartered credit unions improved the ROA to 0.88%, up from 0.59% in the fourth quarter of 2011.

The first-quarter return on assets was the highest for any quarter since 2005, said Peter Bildsten, DFI Secretary. "The fact that this ratio is returning to pre-recession levels is very encouraging," Bildsten said.

State-chartered credit unions posted a net income of $49.4 million--an increase of 21.4% over the previous quarter and up 77.5% from a year earlier.

While lending was basically flat in the first quarter of 2012, credit unions improved their net income through prudent expense management and a reduction in delinquent loans, which dropped to 1.70% from 1.83%, said Ginger Larson, director of the Office of Credit Unions, the DFI division that oversees credit unions.

Assets grew to $22.88 billion from $21.92 billion, an increase of 4.4%. The net worth ratio dipped slightly to 9.73% from 9.96% at year-end 2011.

"The overall health of Wisconsin credit unions appears to be quite strong," Bildsten said. "Their solid performance in the first quarter is good for Wisconsin consumers and the state's economy."

CUs revel in Cinco de Mayo celebrations

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SAN JOSE, Calif. and DALLAS (5/11/12)--Credit unions hoping to attract Hispanic members often take the opportunity during the culture's celebrations to offer their message about the credit union difference. Two credit unions did just that during Cinco de Mayo celebrations last weekend.

Redwood CU (RCU) sponsored and participated in Roseland's Cinco de Mayo Festival in Santa Rosa, Calif. From left, Efren Carrillo, Sonoma County supervisor; Bill Cheney, Credit Union National Association president/CEO; Brett Martinez, RCU president/CEO; and Donna Zapata, Sonoma County Hispanic Chamber of Commerce executive director. (Photo provided by Redwood CU)
Cinco de Mayo is an annual celebration of Hispanic history and culture.

Redwood CU (RCU), with $2 billion in assets, San Jose, Calif., sponsored and participated in Roseland's Cinco de Mayo Festival in Santa Rosa.  RCU volunteers, including employees, family and friends, participated in the festival, which carried the theme, "Celebrando en union: Celebrating in Unity."

Bill Cheney, president/CEO of the Credit Union National Association was also on site to help celebrate.

RCU provided financial information and literacy, both in Spanish and English. RCU's mascot, Reddy the Redwood, entertained children and promoted the message that saving money is fun.

Neighborhood CU, Dallas, was a presenting sponsor for the Cinco de Mayo Dallas 2012 Festival May 5. The credit union also sponsored a booth at the event. (Photo provided by the Texas Credit Union League.)
"Redwood CU realizes the value of staying connected and being involved each and every day," said Rene Meza, RCU branch manager and festival organizer. "I am honored to work with the Hispanic community in many ways and partnering with many others who also value community involvement like we do here at Redwood CU."

In Dallas, Neighborhood CU, with $314 million in assets, was a presenting sponsor May 5 of the Cinco de Mayo Dallas 2012 Festival, which is in its 22nd year.

As a part of the sponsorship, the credit union was the "Official Credit Union of Cinco de Mayo," according to the Texas Credit Union League (Lone Star Leaguer May 8). Neighborhood CU participated in the event's annual parade, which was viewed by thousands of spectators.

Neighborhood CU also sponsored a booth at the event. Representatives from the credit union's Oak Cliff branch greeted spectators, offered financial education and games along with a drawing for a Fiesta Mart gift card.

Credit Union National Association (CUNA) has partnered with Coopera to help credit unions nationwide grow by serving the Hispanic community. Coopera and CUNA designed "El Poder es Tuyo" (The Power is Yours), a customizable, Spanish-language personal finance website for Hispanic credit union members and potential members. Use the link.

Catalyst Corporate First Corp. plan purchaseassumption

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PLANO, Texas (5/10/12)--Catalyst Corporate FCU and FirstCorp CU have signed a non-binding letter of intent to enter a purchase and assumption agreement.

The transaction takes the form of a purchase and assumption of certain FirstCorp assets and share accounts. Legacy assets will not be acquired by the Plano, Texas-based Catalyst Corporate, but will remain in the Phoenix-based FirstCorp charter until they mature or are sold.

"This approach protects FirstCorp's membership capital, which will remain at FirstCorp, and also will immunize Catalyst's members against risk of future losses on these assets," said Kathy Garner, Catalyst's president/CEO.

The deal must be approved by the National Credit Union Administration and the Arizona Department of Financial Institutions.  The two corporates said they do not anticipate any obstacles. The agreement benefits the members of the corporates, the regulatory agencies and all credit unions impacted by the status of the National Credit Union Share Insurance Fund, they said.

"The board of directors believes that this combination with Catalyst Corporate provides the best long-term value proposition for the members of FirstCorp," said David Doss, chairman of the $1.1 billion corporate and president/CEO of Arizona State CU, Phoenix.  "We have studied the Catalyst business plan closely, and we see a sustainable model that will allow our 48 members to continue to enjoy low-cost, comprehensive wholesale financial services well into the future."

Catalyst Corporate's business model is driven largely by efficiencies generated through scale and technological innovation, making this move part of a logical progression, said Lin Hodges, chairman of Catalyst Corporate and president/CEO of Associated CU, Norcross, Ga. "Since the early planning stages, Catalyst has promoted the reality that corporates must be able to achieve scale in this new operating environment in order to thrive," Hodges added. 

The consolidation will follow the completion of Catalyst's acquisition of the Western Bridge Corporate operations on July 1. FirstCorp's board of directors has voted to have Catalyst Corporate take on processing of FirstCorp's member ACH in advance of the full conversion.

The early conversion is scheduled to ensure that FirstCorp APEX-ACH can transition from the U.S. Central Bridge Corporate platform before Sept. 30, said Greg Harden, First Corp. interim CEO.

IHuffPoI graphic tells why CUs are better than banks

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WASHINGTON (5/10/12)--A large graphic in The Huffington Post Tuesday tells why credit unions are often better than banks. The graphic, which accompanies an article on "Credit unions: The Pros and Cons of Moving Your Money to A Nonprofit Financial Institution," was produced by IBM Southeast Employees' FCU, Boca Raton, Fla.

The HuffPo article notes the rise of credit unions in membership "as banks have come under more scrutiny for their never-ending profit-making measures." 

The graphic, "Credit Unions vs. Big Banks," explains the difference in ownership structure. It notes they both offer financing for major purchases and money management options, "but they're not as similar as you'd think. On average, credit unions offer more attractive rates and better returns on account holdings."

It compares interest rates on various new- and used-auto loans, fixed-rate and adjustable-rate mortgages, credit cards and savings and checking accounts.

The graphic also outlines other reasons to choose a credit union--low minimum balance requirements, less restrictive eligibility requirements, and secure, insured funds; some of the drawbacks; and customer satisfaction scores for credit unions and banks.

Check out the graphic by using the link.

Matz reiterates MBL support at Maine league meeting

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PORTLAND, Maine (5/10/12)--National Credit Union Administration  (NCUA) Chairman Debbie Matz reiterated her support for raising credit unions' member business lending (MBL) cap during a speech to the Maine Credit Union League's Annual Delegates' Meeting in Portland Friday.

Click to view larger image National Credit Union Administration Board Chairman Debbie Matz addressed delegates at the Maine Credit Union League's annual meeting Friday, offering her perspective on topics including member business lending, regulatory issues and the growing popularity of credit unions. (Photo provided by the Maine Credit Union League)
Matz told more than 100 delegates from credit unions across Maine that she supports raising the cap because "credit unions know their members and generally lend in a responsible manner, so raising the cap could enable more small businesses to access credit at their local credit union."

Credit unions have a measure before Congress, S 2231, which would raise the MBL cap to 27.5% of assets from 12.25% to allow credit unions to make more small business loans.  The Credit Union National Association has estimated that raising the cap would help inject the economy with $13 billion in new small business loans and help create 140,000 jobs in the first year at no expense to the taxpayer.

Matz also told attendees she believes that NCUA and credit unions have a lot of common ground, and "we can and do work well together. Although our role is to regulate credit unions and ensure the safety and soundness of the Share Insurance Fund, NCUA wants to create an environment that protects consumers and allows credit unions to operate successfully. That is why, under our Regulatory Modernization Initiative, we are conducting a comprehensive review of all regulations and policies to determine which ones can be eliminated, streamlined and/or updated."

Matz also highlighted consumers' heightened awareness of credit unions and "the positive benefits that this increased awareness is having on credit unions.  Membership has grown by nearly 2 million since 2010. In the aggregate, net worth, assets and earnings have all increased, while delinquencies and charge-offs have declined.

"The worst appears to be behind us," she noted. "Credit unions overall have been improving year-by-year and are growing even stronger."

Matz also noted that credit unions in Maine and across the country are coming through the economic recovery safe and sound, and I think they have a bright future." She applauded Maine credit unions'  "for the great work you do" and expressed appreciation for their feedback on improving the regulatory and examination process.

WOCCU program provides Guatemalan CUs practical knowledge

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WASHINGTON (5/10/12)--Ten Guatemalan International Credit Union Leadership Program (ICULP) scholarship recipients finished their month-long internships with U.S. credit unions in California and Iowa by traveling to Washington, D.C., where they met with credit union organizations and participated in the Professional Fellows Congress.

Click to view larger image Steven Sapp, left, president/CEO of San Francisco FCU (SFFCU), welcomed Carolos Enrique Paredez to California, where Paredez participated in the World Council of Credit Unions' International Credit Union Leadership Program. SFFCU, which hosted Paredez, was one of eight California and Iowa credit unions hostintg 10 Guatemalan visitors in April.
The World Council of Credit Unions (WOCCU) program, which is part of the U.S. Department of State's Professional Fellows program, paired participants with eight U.S. credit unions coordinated with the help of the California and Nevada Credit Union Leagues and the Iowa Credit Union League.

Carlos Enrique Paredez, a branch manager for Cooperativa de Ahorro y Credito Guayacan in Guatemala, knows his credit union must keep pace with the market to remain competitive. Lessons he learned in ICULP, particularly about involving  Web page development and maintaining a balanced member focus, will help his institution achieve greater success.

"One of my objectives was also to learn how I could increase deposits in my credit union," Paredez said. "I realized that we focus too much on youth savings and should instead focus on older adults who have more of a capacity to save."

"The lessons learned by program participants will be invaluable to the growth and success of their credit unions in Guatemala," said Brian Branch, WOCCU president/CEO. "We greatly appreciate the participation of the credit unions in California and Iowa and their trade associations in providing exceptional internship opportunities."

Participating California credit unions included: Family FCU, Wilmington; SCE FCU, Irwindale; Nikkei CU, Gardena; Patelco CU, Pleasanton; San Francisco FCU, San Francisco; and Water and Power Community CU, Los Angeles. Participating Iowa credit unions included Des Moines Metro CU, Des Moines; and Greater Iowa CU, Ames.

Click to view larger image Credit unions from Guatamala who participated in the World Council's International

Credit Union Leadership Program  visited the Credit Union National Association in Washington, D.C. From left: Billy Rodas, Fondo de Garantia FENACOAC; Juan Jimenez, COPECOM; Roberto Monge, FENACOAC;  Victor Garcia, Acredicom; Carlos Paredez, Guayacan; Derik Rudeen, UPA; Sandra Chacon, Cootecu; Carlos Mucun, Colua; Cintia Alvarado, Chiquimulja; and Rene Lopez, Guadalupana. (Photos provided by the World Council of Credit Unions)
Last September, WOCCU's Worldwide Foundation for Credit Unions received a grant to run a Professional Fellows project that became ICULP. It educates young entrepreneurs in the credit union industry through a series of four exchanges. The next exchange will include a delegation of 10 U.S. credit union representatives traveling to Guatemala for a two-week credit union internship in June.

While in Washington, the Guatemalan interns visited the National Credit Union Administration (NCUA) to study the regulatory structure governing U.S. credit unions. The NCUA visit was particularly relevant since the Guatemalan credit union system, MICOOPE, recently launched its own private deposit guarantee fund to protect its 26 credit unions that serve an aggregate one million members.

The group also met with Credit Union National Association (CUNA) and World Council officials to better understand the roles played by national and international trade associations in protecting and advocating for credit union interests. Pat Sowick, CUNA senior vice president of league relations, also shared how CUNA advocates on behalf of its more than 7,300 member credit unions and discussed the importance of the league relations in communicating with those member credit unions.

The week ended with the Professional Fellows Congress organized by global education firm World Learning and sponsored by the U.S. Department of State, Bureau of Educational and Cultural Affairs, Office of Citizen Exchanges. The two-day event brought all 18 Professional Fellows programs together with a total of 200 participants from 49 countries. The congress featured Ambassador Wendy R. Sherman, the U.S. Department of States' undersecretary for political affairs, as a keynote speaker and involved other U.S. Department of State staff from the Office of Citizen Exchanges. Many breakout sessions focused on ways to implement the ideas and best practices learned in participants' home countries.

MnCUN article Co-ops strong in Minnesota

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ST. PAUL, Minn. (5/10/12)--Cooperatives offer Minnesota consumers an alternative way to conduct business, and credit unions are a strong presence within the state's cooperative community, Minnesota Credit Union Network President/CEO Mark Cummins wrote in an opinion editorial article published Tuesday in Finance & Commerce.

"The state's 140 credit unions make up the financial sector of the cooperative movement, providing financial products and services to 1.5 million Minnesotans," Cummins wrote.

Throughout 2012, cooperatives worldwide are celebrating the United Nations-designated International Year of the Cooperatives.

Cummins cited Russ Plunkett, president/CEO of Postal CU, Woodbury, who is a member of the Cooperative Network, a trade association that serves more than 600 member cooperatives in Minnesota and Wisconsin.

He noted the organization "helps cooperatives most effectively serve 6.3 million residents who are members of a variety of cooperatives, including health, financial, livestock marketing, telecommunications, electric, housing, insurance and more," Cummins wrote.

Plunkett also serves as a board member of the Credit Union National Association's Cooperative Alliance Committee, Cummins said.

Dan Stoltz, president/CEO of SPIRE FCU, with $561 million in assets, Falcon Heights, was also cited in the article for his involvement as a member of the Cooperative Network Board and as the former chairman of the Cooperative Foundation Board. SPIRE also offers a Visa card program through a partnership with four local grocery co-ops.

At the kickoff of the International Year of Cooperatives, United Nations officials stated that as a "catalytic force," cooperatives build economic power, create opportunity and enable communities to compete in the global economy," Cummins concluded. "Living in the state of cooperatives, Minnesotans have a unique opportunity to fully embrace the cooperative movement."

Chip will ease data breach concerns experts

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MADISON, Wis. (5/10/12)--Data breaches continue to grow in the U.S., and that trend will likely continue until the U.S. adopts chip technology, fraud experts said during a plastic card fraud webinar sponsored by CUNA Mutual Group Wednesday.

Data breaches were up 33% in 2011, according to statistics from security research company Trustwave cited in the webinar. About 44% of those incidents occurred in the food and beverage industry, where debit cards are increasingly used--and small merchants are notoriously lax about security, Trustwave reported.

"Another trend that we've been seeing for about a year is that franchise business models are being targeted by cyber criminals," said Visa Senior Business Leader Joe Majka, one of the webinar presenters.

About 10% of the credit unions participating in the webinar Wednesday offer chip technology to their members.

Ann Davidson, CUNA Mutual Group senior risk manager, recommended that credit unions make the Europay-Mastercard-Visa standard chip technology a part of their strategic plans and begin discussions with their vendors about migrating to the technology.

"Mag stripe fraud is continuing to mushroom and the chip will be ever so important in eliminating that exposure," Davidson said.

Chip technology comes in two types: contact and contactless, Davidson said. Contact chips include an integrated circuit or chip that communicates information to a point of transaction terminal. Contactless chips employ a radio frequency or infrared technology that allows the terminal to communicate or transact without physically touching the card.

Because of increasing fraud risk, member convenience is no long the primary factor driving chip adoption, Davidson said. The cost of fraud also is driving the investment in chip technology, Majko and Davidson stressed.

The U.S. is the last major country to adopt chip technology, Davidson said. Visa has stepped forward to accelerate chip migration in the U.S.

Visa announced last year it will institute a U.S. liability shift for domestic and cross-border counterfeit card-present point-of-sale (POS) transactions, effective Oct. 1, 2015. Currently, POS counterfeit fraud liability is held by card issuers. With the liability shift, if a contact chip card is presented to a merchant that has not adopted contact chip terminals, liability for counterfeit fraud will shift to the merchant's acquirer, according to Visa's website.

Visa will also require U.S. acquirers to support merchant acceptance of chip transactions by April 1, 2013.

As credit unions and their members migrate to chip technology, most merchants will continue to accept magnet stripe technology, Davidson said.

Most instant issue card devices used by financial institutions are also enabled for chip technology, she added.

Marketing chip technology to members will be critical, Davidson said. "Your members are going to be asking about it as they see other consumers put their cards in chip readers," Davidson.

Credit unions can educate their members through newsletters statements inserts, social media, websites and employee training, she said.

CU System briefs (05/08/2012)

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  • MEDFORD, Mass.(5/9/12)--A man robbed Medford, Mass.-based Members Plus CU Monday morning and threatened the teller's life in a note, according to Medford police (patch.com May 8). A white male in a hooded sweatshirt entered the $218 million asset credit union at about 9:50 a.m. and presented a note that told the teller "give me all the cash in your drawer or you die in five minutes." He received an unknown amount of cash and fled on foot. He also wore rubber gloves, a faded green baseball cap and blue jeans. The suspect was still at large at press time …
  • IRONDALE, Ala. (5/9/12)--Attendees from more than 60 credit unions from 10 states helped Alabama-based Corporate America CU celebrate 30 years of serving credit unions during its annual meeting in Destin, Fla. April 30-May 2. Speaker topics included: Investment Strategies, Credit Union Operations and the Economy, Board Governance, Replacing Lost Fee Income, Vendor Due Diligence and Vendor Management Programs, Remote Deposit and Mobile Deposit Security, and Strategic Foresight in Financial Institutions. Joy Breedlove, education consultant with Corporate America, said the corporate now offers attendees Continuing Professional Education (CPE) credits. The corporate credit union was recently approved as a registered sponsor on the National Registry of CPE Sponsors, offered by the National Association of State Boards of Accountancy. The $3.7 billion asset Corporate America serves more than 500 credit unions in 39 states, Puerto Rico and Guam …
  • ROCHESTER, N.H. (5/9/12)--Holy Rosary CU (HRCU), Rochester, N.H., has partnered with The Monarch School of New England and will serve as a training site for students of the school. The organization serves students with significant disabilities from ages 5 to 21 and designs programs based on their individual needs and capabilities. Jordan Brown, 16, is the first student to take part in the program with HRCU in a partnership that began in March. While serving as HRCU's ambassador, Brown is learning new skills and "reminding us about diversity and acceptance," said Chris Patrowicz, vice president of human resources at HRCU. "Jordan arrives by 10 a.m., proudly wearing his HRCU shirt and excited to be a part of our team. Our employees look forward to his arrival and really enjoy his friendly nature." His duties include distributing mail to employees, collating and applying postage to daily outgoing mail and ensuring the employee lounge is clean and replenished with supplies. Pictured are, from left:  Kathy Perry, occupational therapist at The Monarch School of New England; Patrowicz; Brown; and Brian Hughes, Holy Rosary CU's president/CEO. (Photo provided by Holy Rosary CU) …

Altura turnaround continues with 7.03M in net income

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RIVERSIDE, Calif. (5/9/12)--Altura CU, based in Riverside, Calif., reports that its financial turnaround from last year's losses continues, with an improved net income of $7.03 million on assets of $708.2 million for first quarter 2012--a "substantial turnaround" from first quarter 2011, when it reported a loss of $1.63 million on assets of $724.8 million.

"This was a great quarter for us, and the prospects are for that to continue," said Mark Hawkins, CEO at Altura. "Not only is this our fourth straight quarter of strong net income, it's the best three-month period in our history."

Altura serves the Southern California's Inland Empire, which was hit hard by the Great Recession, with an unemployment rate that exceeded 15% at one point. The area saw record home foreclosures, which required bolstering of the credit union's allowance for loan losses, said the credit union.

"Like everyone else in the Inland Empire, the last few years have been extremely difficult for our organization," Hawkins said. "Our main focus was on our members and helping them as much as we could through these difficult times," he said, noting the credit union "made adjustments necessary to secure that we had a future, that we were here for our members now and for years to come."

As of March 31, Altura reported a net worth ratio of 8.10%, more than 250 basis points greater than the same period last year when it had a 5.56% net worth ratio.  The March ratio is also up from year-end 2011's net worth ratio of 7.84%.

Hawkins attributed the good financials to March loan production, which "was the best we've seen in the better part of two years.  We are finally seeing an uptick in members seeking new auto and home loans. To us, this signals widening improvement in the Inland Empire's economic health. The housing market is finally stabilizing, and Altura has been able to reduce its provision for loan loss expense significantly compared to the same period last year."

Altura realizes there are still challenges. "Unemployment still isn't where it needs to be in our communities," Hawkins said. "But we have been positioning Altura so that when a full market recovery takes place, we are ahead of it and ready to step up for our members."

Altura's membership for first quarter stood at nearly 95,000, down from 104,000 a year ago. Its cost of operations is 24% lower than a year ago.  Last year it closed a branch inside a Wal-Mart and converted three others to all-electronic branches to cut costs.  However, last month it was able to re-staff its Murrietta location and return it to full services. "We are thrilled that came to fruition last month," Hawkins said.

Missouri newspaper CUs bumping up against MBL cap

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SPRINGFIELD, Mo. (5/9/12)--Some Springfield, Mo.-based credit unions are bumping up against their member business lending (MBL) limit--or are close to it, according to an article Monday in the Springfield Business Journal. A local business also told the newspaper about the difficulty in getting banks' backing of a loan for expansion.

Both situations underscore the need to lift the MBL cap so credit unions can offer more loans to the "backbone of America"--small businesses, they said in the Journal (May 7-13). Credit unions nationwide and the Credit Union National Association (CUNA) are urging Congress to support S. 2231, which would lift the cap to 27.5% of assets from the current 12.25%.

CU Community CU, whose assets are at $74 million, with a $9.06 million MBL cap, told the publication that its cap is tapped out, unless assets grow, other loans are paid off, or legislators pass S. 2231.  "We're stuck until a decision is made or that bill is brought to the floor for a vote," Carolina Decker, vice president of lending, told the publication.

BluCurrent CU 's business lending services department is about a year old, so the need for a higher cap is less pressing. However, the credit union is keeping tabs on the issue, said Brian Roy, BluCurrent's vice president of business lending services. The credit union has more than $130 million in assets, but is working with a self-imposed cap of roughly $15 million to make sure it doesn't exceed the limit. Its current business loan volume is more than $6 million, but it will be in the $10 million range by mid-year, Roy told the publication. He expects the credit union likely will bump against its limit by this time next year. Then, potential borrowers would be placed on a waiting list.

Shane Rudminat, owner of a small Springfield business, Grace Vending LLC, noted that when he approached two banks about financing an expansion of his business, he got little traction and the process was "extremely complicated."  However, he secured a loan from BluCurrent for more than $100,000 to buy out a partner and purchase a competitor, he told the Journal, saying the credit union turned out to be "the better choice." Now the company has 200 vending machines throughout the Ozarks and has grown from a side business to Rudminat's full-time job.  The business now sustains his family and has grown.  Since getting the original loan, he also has financed business vehicles and other needs with the credit union.

"Small business is the backbone of America," CU Community CU's Decker said in the article. "That's where job creation starts, so every month that I turn somebody away, that's impactful for my community. There are a lot of folks who want to grow and want to do new things, or need help, and we can't meet their needs,' she told the newspaper.

If Congress lifts credit unions' MBL cap to 27.5% of assets, CUNA estimates that it would create $13 billion in new business loans and help generate 140,000 new jobs in the first year. All of this would be at no cost to the taxpayer, CUNA said.

Use the link for the full article.

Member growth spurt Half a million in March

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MADISON, Wis. (5/9/12)--Credit unions gained half a million new members in March, bringing total membership to 95.2 million, according to the Credit Union National Association's (CUNA) Credit Union Monthly Estimates. The growth spurt indicates the momentum credit unions gained leading up to Nov. 5's  Bank Transfer Day activities is alive and well five months after that  event, and credit unions should continue to make the most of that momentum, said CUNA.

March's membership total is an increase of 2.3 million members since March 2011's membership total of 92.9 million members. The new monthly figure also represents a gain of 1.6 million members since Nov. 1, just before Bank Transfer Day, a date targeted by a viral social networking campaign for consumers fed up with big banks' debit card fees to switch accounts from big banks to credit unions and community banks. Roughly 40,000 new accounts were opened at credit unions on Nov. 5 alone.

March's growth spurt is close to a record for a single month. CUNA Chief Economist Bill Hampel says the estimates likely will be revised downward a little, but even so, the March growth would still stand out. The 500,000 gain in March comes on the heels of very strong increases in membership of 400,000 in February, 300,000 in January and 200,000 each in November and December.

At the same time that membership has accelerated, total assets have crossed the $1 trillion mark as members continue to increase their deposits in credit unions.

"Clearly, Bank Transfer Day has a tail to it," Hampel told consumeraffairs.com (May 4). "Net membership growth at credit unions during the first three months of 2012 is greater than growth for the whole of 2010. People are discovering it is easier to join a credit union than they think, and they get a great deal both in terms of pricing and service," he said.

In the past decade, credit unions have seen a gain of 11.8 million members, according to CUNA's monthly estimates. Here's a year-by-year comparison the past decade:

  • 2011--94 million members, a gain of 1.4 million
  • 2010--92.6 million members, a gain of 600,000
  • 2009--92 million members, a gain of 1.3 million
  • 2008--90.7 million members, a gain of 1.4 million
  • 2007--89.3 million members, a gain of 1.1 million
  • 2006--88.2 million members, a gain of 1.2 million
  • 2005--87 million members, a gain of 900,000
  • 2004--86.1 million members, a gain of 1.2 million
  • 2003--84.9 million members, a gain 1.5 million
  • 2002--83.4 million members, a gain of 1.8 million
Consumeraffairs.com pointed out that as more consumers desert big banks, those who remain customers at those banks can expect even higher fees. Already major banks are seeking ways to increase their profits as their customer base declines.

CUNA expects to see a faster rate of growth for the foreseeable future as credit unions continue educating the public and media about the benefits of credit unions.

Alloya announces key exec promotions

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WARRENVILLE, Ill. (5/9/12)--Alloya Corporate FCU in Warrenville, Ill., has announced expanded responsibilities for two of its executives: Todd M. Adams and Kevin A. Brauer.

"Their leadership has been instrumental in making the members' desire for a new corporate credit union a reality," said Alloya CEO Charles Furbee. "With their new responsibilities, they will both continue to guide and help the corporate grow as we move forward with new and enhanced products, operating platform conversions and strategic partnerships."

Adams, based in the corporate's Warrenville office, will maintain his current role as chief financial officer, which includes oversight for the accounting, information systems, compliance, operational integrity and project management functions of the corporate.

He will add the title of senior vice president and director, affiliated business service, which will ensure consistent administration of the corporate's affiliated business services and provide a focal point for new ventures.

Brauer, based in the corporate's Albany, N.Y., office, will maintain his current role as senior vice president, member relations, leading the corporate's member relations division. He oversees the corporate's sales, member call center, marketing and payments processing operations, and its relationships with state and national credit union organizations.

Brauer will add the title of chief operating officer and will lead the corporate through several simultaneous operating changes (conversions from U.S. Central Bridge platforms, including Automated Clearing House, the outsourcing of item processing operations to VSoft Corp. and the launch of its Remote Deposit Capture suite). Brauer also will fulfill a key role in the integration of operations between Alloya and any future strategic partners.

Financial services do well on global satisfaction survey

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SAN FRANCISCO (5/9/12)--Consumers worldwide are satisfied with the customer service they receive--with financial and insurance services doing very well--according to the Zendesk Customer Satisfaction Index, March 2012. The study has implications for credit unions.

Zendesk provides cloud-based customer service software for credit unions, small and regional banks, mortgage companies and startups.

The global customer satisfaction index for all customers surveyed in 19 industry categories was 86%.  

The satisfaction benchmark for financial and insurance services was 93%, putting the industry in the upper third for satisfied customers. The high was for real estate at 96%, and the low was for entertainment and arts at 77%.

The formula for customer satisfaction developed by Zendesk indicates that bigger companies that efficiently deliver high-quality support at large scale have the most satisfied customers. 

Zendesk also found three clear guidelines best-in-class companies follow that separate them from the rest:

1. Immediate response matters: Responding quickly has the single greatest impact on customer satisfaction. First response time for financial and insurance services clocked in at 28.6 hours, compared with the average of 23.6 hours for all industries.

2. Be where your customers are: Today it is critical to be available where your customers want to reach you: a company website, Facebook, Twitter, e-mail, phone or chat.

3. Let your customer serve themselves: Companies that offer rich self-service customer support forums and frequently asked questions have a higher level of customer satisfaction.

The study also found that 82% of Americans stopped doing business with a company because of poor service, costing companies $338.5 billion a year worldwide.

Newtek on panel at Riveras jobs fair

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NEW YORK (5/9/12)--Barry Sloane, president/CEO of Newtek Business Services, The Small Business Authority, will appear on a panel with Geraldo Rivera, journalist and host of "Geraldo," at a job fair on May 15 at The Javits Center in New York City.

The event aims help communities get back to work. Rivera will broadcast his "Geraldo" show on 77 WABC from the event at 10 a.m. to noon ET. He will host an on-air panel discussion about how businesses can help put America back to work.

The job fair will be held from 11 a.m. to 3 p.m. (ET). 

Newtek Business Services, The Small Business Authority, is a CUNA Strategic Services provider.

"Putting America back to work is clearly a goal of all American citizens and a priority for Newtek Business Services, The Small Business Authority," Sloane said. "Through its lending subsidiary Newtek Small Business Finance, we were the nation's No. 1 non-bank [Small Business Association] 7a lender in 2011, and since our inception, have provided over a half a billion in loans to small business." 

The SBA requires that a minimum of every $55,000 of funding to small businesses creates or stabilizes one job, according to Newtek. "Therefore, we are estimating that we have created or saved roughly 9,000 jobs," Sloane said. "Our services reduce business expenses, minimize risk and enable small businesses to improve their cash flow, which consequently will allow them to grow and hire more."

WYCUP scholarship program agenda announced

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MADISON, Wis. (5/9/12)--Enrollment ends June 1 for the 2012 World Council of Credit Unions' (WOCCU) Young Credit Union People (WYCUP)  program, to be held in conjunction with the World Credit Union Conference, July 15-18 in Gdańsk, Poland.

Click to view larger image The World Council of Credit Unions' Young Credit Union People Class of 2011 meets in Glasgow, Scotland. Five nominees won all-expense-paid scholarships to attend this year's WYCUP session in Gdańsk, Poland. Enrollment ends June 1 for the 2012 WYCUP program, to be held in conjunction with the World Credit Union Conference, July 15-18 in Gdańsk, Poland. (Photo provided by the World Council of Credit Unions)
WYCUP is designed to foster professional growth of talented credit union professionals and volunteers age 35 and younger. Each year, five outstanding participants are chosen for all-expense-paid scholarships to the following year's program.

"One of the true signs of any profession is the willingness of its practitioners to educate the next generation of leadership," said Brian Branch, WOCCU president/CEO. "The WYCUP program does that, assuring that credit unions worldwide will thrive to serve future generations of members."

The agenda for this year's WYCUP program, which runs parallel to the conference, stresses a mix of conference general sessions, education and networking opportunities designed for younger professionals. Events include:

  • July 15: A daylong educational and networking session tailored to those age 35 and under, and the conference's opening ceremonies;
  • July 16: general session and lunch with the WOCCU Board of Directors (nominees only);
  • July 17: Specially designed educational sessions, lunch with a WYCUP speaker and dinner with WYCUP participants and their families; and
  • July 18: The annual awards ceremony, during which five 2013 scholarship winners will be introduced, followed by the 2012 World Credit Union Conference closing celebration in the historic Gdańsk Shipyard, the birthplace of the Solidarity movement.
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 WOCCU 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 the conference in Gdańsk; be 35 years of age or under as of Jan. 1; and submit a completed nomination form to WOCCU with all supporting materials by June 1.

MCUA announces new board members

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ST. LOUIS (5/912)--The Missouri Credit Union Association (MCUA) announced the election of two new board members.

Glenna Osborn, president at Missouri Central CU in Lee's Summit, was elected to represent credit unions in the Kansas City Chapter.

Randy Yeck, executive vice president at Vantage CU in Bridgeton, joins the board representing credit unions from the St. Louis Chapter.

Yeck has been in the financial services industry for more than 35 years, with more than 25 years at Vantage CU. As Vantage executive vice president, Yeck has oversight for the human resources, compliance, facilities and security departments. Before joining the credit union movement, Yeck worked in item processing, human resources and as a stockbroker with a major brokerage firm.

The two new members join 10 others who were sworn in to office at the MCUA annual business meeting in April. They are:

  • Chair--Dennis Pierce, president/CEO of CommunityAmerica CU, Kansas City;
  • First vice chair--Brian Eyestone, president, Southpointe CU, St. Louis;
  • Second vice chair--Judy Hadsall, president/CEO, CU Community CU, Springfield;
  • Treasurer--Rick Nichols, president, River Region CU, Jefferson City;
  • Secretary--Michael O'Brien, senior vice president and chief marketing officer, St. Louis (Mo.) Community CU;
  • Chair emeritus--Stan Moeckli, president, Electro Savings CU, St. Louis;
  • Louie Delk, president, Conservation Employees CU, Jefferson City;
  • Tony DiGiovanni, president, CSD CU, Kansas City;
  • Coby Lamb, president, Northwest Missouri Regional CU, Maryville; and
  • Kirk Mondy, president, Poplar Bluff (Mo.) FCU.

Illinois league legislative day kicks off today

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SPRINGFIELD, Ill. (5/9/12)--Nearly 120 credit union activists are expected to attend as the Illinois Credit Union League (ICUL) kicks off its annual legislative day and reception today with a new format for the event in Springfield.

Part of the strategy behind the new format is an earlier start time to provide attendees with an improved opportunity to visit local lawmakers earlier in the day than in the past.

This year's event also features a new luncheon, where Illinois State Treasurer Dan Rutherford will be the keynoter. During his state legislative career, Rutherford has been a strong credit union supporter, said the league. He will discuss the role credit unions play in the financial market.

Other highlights will include:

  • A regulatory update from National Credit Union Administration board member Michael Fryzel, who will discuss key regulatory developments impacting the credit union movement;
  • A corporate credit union update from Michael Lee, vice president of member relations, Midwest region, for Alloya Corporate FCU, Warrenville;
  • ICUL staff members Steve Olson, executive vice president, general counsel and chief operating officer, and Keith Sias, vice president of state governmental affairs, who will brief participants on current issues critical to credit unions before their visits with lawmakers;
  • Recognition of credit union champions Joseph Lyons (D-19), and assistant majority leader, and Lisa Dugan (D-79), who will retire from the Illinois General Assembly after this spring session;
  • State Capitol visits, so participants can personally call on their lawmakers and view the legislative process firsthand; and
  • A legislative reception at the Governor's Mansion. All 177 lawmakers from both sides of the aisle, constitutional officers and other dignitaries have been invited.
The Illinois General Assembly is scheduled to adjourn its spring legislative session on May 31.

Eleven Iowa CU execs join womens network

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DES MOINES, Iowa (5/9/12)--Eleven executives from the Iowa Credit Union League and its affiliated organizations have joined the Global Women's Leadership Network (GWLN).

Click to view larger image World Council of Credit Union's Global Women's Leadership Network includes 11 new enrollees from the Iowa Credit Union League and its affiliated organizations. From left to right: (front row) April Schmaltz, TMG Financial Services; Anne Whatley, Affiliates Management Co.; Emily Caropreso, Iowa league; and  Miriam De Dios, Coopera; (middle row) Cynde Urness, The Members Group; Darlis Wambold, Iowa league; Andrea Stritzke, vice president, regulatory compliance, PolicyWorks; (back row) Marybeth Foster, executive director, Iowa Credit Union Foundation; Ginger Heckman, Community Business Lenders; Dianne Taylor, Iowa league; Shazia Manus, The Members Group. (Photo provided by the Iowa Credit Union League).
GLWN is international education and advocacy group created in 2009 by the World Council of Credit Unions (WOCCU) to provide women with the opportunity and resources to make a measurable difference in the lives of each other, in the lives of credit union members and in their communities.

"An essential aspect to leadership development is continuing education and awareness, and for credit unions that takes on a worldwide scope," said Patrick S. Jury, Iowa Credit Union League president/CEO. "As members of the GWLN, our enrollees will have the opportunity to collaborate, learn, and share solutions with other credit union leaders both in the U.S. and across the globe."

The network offers exposure to international perspectives on common challenges faced worldwide, such as growth strategies, alternative capital and efficiency in operations.

The leadership network also helps strengthen financial stability for families. In many countries, women often are the financial decision makers for the family, responsible for spending and saving, but sometimes lack expertise or face stigma about a woman's role.

The Iowa members of the GWLN are:

  • Marybeth Foster, executive director, Iowa Credit Union Foundation;
  • Ginger Heckman, member business lending coordinator, Community Business Lenders;
  • Dianne Taylor, management consultant, Iowa league;
  • Shazia Manus, CEO, The Members Group;
  • Cynde Urness, senior vice president, product management, The Members Group;
  • Darlis Wambold, senior executive assistant, Iowa league;
  • Andrea Stritzke, vice president, regulatory compliance, PolicyWorks;
  • April Schmaltz, vice president, marketing, TMG Financial Services;
  • Anne Whatley, general counsel, Affiliates Management Co.;
  • Emily Caropreso, director of communications and marketing, Iowa league; and
  • Miriam De Dios, CEO, Coopera.

Maine league annual convention tries new format

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John Murphy, president of the Maine Credit Union League, addresses delegates at the league's 74th Annual Meeting in Portland Friday and Saturday.
PORTLAND, Maine (5/9/12)--More than 650 attendees participated in the 2012 Maine Credit Union League Annual Meeting & Convention held in Portland Friday and Saturday. The event featured a new format, including an opening session, a new time for the delegates' meeting and a closing session.

The convention also featured a sold-out exhibit area that was well-attended by convention-goers, the league said.  

The opening session featured Ken Gronbach, a demographer, presenting an analysis on the role demographics has in the world and "the opportunity that the changing demography offers to credit unions."

Following Gronbach, the league held its 74th annual meeting, attended by 275 representatives from 56 of the state's 62 credit unions who heard Debbie Matz, board chair of the National Credit Union Administration (NCUA), praise Maine's credit unions "for remaining strong during the past four years, and for being well-positioned for the future."

Maine Credit Union  League Director John Doe (left), who is board chair at Eastmill FCU in East Millinocket, and Linda Scott (right), league event coordinator, pose with Walter Bond (center), former National Basketball Association player and one of the world's top-rated motivational speakers. (Photos provided by the Maine Credit Union League)
Matz also discussed her support for member business lending, and gave an update on the comprehensive review of regulations and policies that NCUA is undertaking.

She also called on credit unions to "remain involved in an ongoing dialogue with your regulator to focus on the best interests for the system and the members."  

After the annual meeting, many attendees took in educational sessions.

On Saturday, the convention's new closing session was welcomed by a full house who were treated to a presentation by Walter Bond, former National Basketball Association (NBA) player.

Bond's presentation focused on "the difference that having a positive outlook in the world can make in business and in life."

Because 90% of life is good, rather than focus on the 10% that isn't, you will be happier and more successful if you look at the good, Bond said.

Study Economy attracting new members top priorities

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TALLAHASSEE, Fla. (5/9/12)--The credit union movement and philosophy increasingly are resonating with consumers across the country. However, credit unions still have concerns for the future: the economy, attracting new members, and consumers' understanding of the benefits of credit unions over banks, according to a new survey.

Of credit unions polled for the fourth annual Credit Union Industry Survey by Credit Union 24, a credit union-owned electronic funds transfer network, 53% indicated that their membership increased during 2011, with 46% of those citing Bank Transfer Day, the day set aside on Nov. 5 to transfer accounts from big banks to credit unions and community banks, as the reason for their membership increase.

Click to view larger image Click for larger view
However, credit unions still face challenges. Of those polled, 56% cited the economy as the greatest challenge facing credit unions today. The economy was also the No. 1 challenge in 2010 (with 70%) and 2009 (with 59%), said Credit Union 24. (See chart.)

Attracting new members was the No. 2 challenge with 54%-- a drop from the No. 1 position last year. Consumer understanding of credit union benefits over those of banks was cited as the greatest challenge in attracting new members for the fourth consecutive year.

"The industry took a very aggressive approach to member recruitment during 2011 and it was successful," said Jim Park, president/CEO of Credit Union 24. "Bank Transfer Day, robust marketing strategies and an overall increased awareness of credit unions in the consumer marketplace all helped advance the credit union movement; however, credit unions are rightly concerned with how to keep this momentum going in 2012."

Credit unions continue to believe that misperceptions exist about credit unions in the marketplace and that this is the leading challenge in attracting new members, he said. "Overall, we have moved the needle forward in advancing the credit union movement, but we all need to continue to work together to keep credit unions top-of-mind for consumers so we can continue our upward trajectory."

Other findings:

  • Of those responding, 56% made changes to their interchange income model as a result of imposed regulations, while 33% made no adjustments.
  • Most (66%) said they made no changes to their network relationships in 2011. Roughly 33% did or considered adding or eliminating networks in response to a fluctuating economy and legislative changes during the past few years.
  • Point-of-sale (POS) transactions for 2011 continued the same year-over-year trend as in the past, with 56% increasing their use of POS among their membership.
  • Roughly 55% said ATM usage was steady for their credit union, year-over-year, while 42% said usage had increased.
  • Of those surveyed, 99% said it was important for CUSOs to advocate legislatively and/or lobby on behalf of the industry on Capitol Hill, while 1% indicated CUSOs' legislative efforts do not matter. For the fourth consecutive year, a majority (55%) of those polled said CUSO providers do a "better job" than other providers of serving credit unions.
"It was reassuring to know that the industry, as a whole, wants collaboration at all levels--grassroots, legislatively, and from a product/service perspective," Park said.  Credit unions were "founded on the principles of collaboration and member-ownership, and our survey revealed that a majority …see these principles as remaining at our core," he added.

CU System briefs (05/07/2012)

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  • LAFAYETTE, Ind. (5/8/12)--Two Indiana men have pleaded guilty to a May 24, 2011 robbery at Lafayette, Ind.-based Purdue FCU. Xxavier Jones, 26, and Christopher A. Whirl, 25, pleaded guilty Friday in Tippecanoe Superior Court to robbery while armed with a deadly weapon and theft  (Journal & Courier May 5). During the robbery, both suspects displayed semi-automatic handguns. One suspect jumped the counter, demanded cash, and placed a handgun against an employee's chest. The getaway vehicle was registered to Whirl and Whirl's girlfriend. In it, police discovered the suspects left their cellphones, snapshots of the handguns they used, and one of Jones pointing a gun at the camera.  Sentencing will be May 31 for Whirl and June 20 for Jones …
  • WILLINGBORO, N.J. (5/8/12)--Command Sgt. James Cotten, a board member and director emeritus of Rancocas, N.J.-based ABCO FCU, has received the Tuskegee Airmen Congressional Gold Medal, according to the New Jersey Credit Union League (The Daily Exchange May 7).  He was presented the bronze replica by U.S. Rep. Jon Runyan (R-N.J.) during a ceremony at the Joint Base McGuire-Dix-Lakehurst. Cotten is a member of the group of the prestigious group of Tuskegee Airmen, the first all-black pursuit squadron, which was formed in 1941. The group became one of the most highly respected fighter groups in World War II.  Cotten served more than 20 years in the Army and Air Force, followed by 45 years of civil service at the joint base. For more, read  an interview with Cotten in the Burlington County Times.  (Photo provided by the New Jersey Credit Union League) …

Louisiana Corporate says 2011 data reflect strength

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METAIRIE, La. (5/8/12)--The 2011 financials for the Louisiana Corporate CU indicated it is strong and growing, with member confidence high, LaCorp announced Monday.

CPA firm Carr, Riggs and Ingram issued an unqualified ("clean") opinion in LaCorp's 2011 financial report. LaCorp's net income after assessments by the National Credit Union Administration (NCUA)  rose more than 15% over 2010.  Its deposits totaled $200 million, a 35% increase, and members' shares grew by 35%.

"Our 2011 financials affirm that LaCorp is fiscally sound and in good health," said David Savoie, president/CEO. "And along with members' capital, they are strong indications of credit unions' confidence in our corporate."

LaCorp conducted a campaign in 2011 to raise Perpetual Contributed Capital, resulting in $6.6 million in capital subscriptions. "We raised 120% of our initial target amount," said Savoie. "Service to our members is our top priority, and that commitment is responsible for not only our members' loyalty but also our ongoing success," he added.

The corporate also said that its migration from U.S. Central-based payment systems in nearly complete. LaCorp anticipates completing the conversion by late May, at which time it will have no remaining dependencies on U.S. Central for payment, credit or investment services.

LaCorp's planned merger with Corporate America CU has received approval from the Louisiana Office of Financial Institutions, the Alabama Credit Union Administration, and the board of directors of both institutions. However, approval from NCUA is still pending, said LaCorp.

Matz to IGlobeI Bank charter wont benefit members

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BOSTON (5/8/12)--National Credit Union Administration Chairman Debbie Matz took time out from a Listening Session in Boston to weigh in with the Boston Globe on the matter of a  Massachusetts credit union switching to a bank charter. Her main point: A bank charter won't benefit members.

Members should be fully informed that voting for a conversion isn't in their best interests, Matz has said in the past about credit union-to-bank conversions.  In the article, she said did not see how a decision by Brockton, Mass.-based HarborOne to convert to a mutually owned cooperative bank would help its 140,000 members (Boston Globe May 7).

"I am concerned when they say they are doing it for the benefit of the members," she told the publication. "There is no reason to think that members will be better served by a bank than a credit union."

The $1.8 billion asset credit union, the state's second largest credit union, in February revealed plans to seek a conversion. Its board approved the conversion plan and is waiting for approval from the state and federal regulators.  The credit union has said a conversion would give it the ability to: reach a broader group of potential member/customers, make more commercial loans and raise more capital.  It cannot open a branch in Boston because it is restricted to serving four counties in Southeastern Massachusetts, it declined to make $70 million in loans last year, saying it was bumping up against its MBL ceiling, and it could not sell stock to raise capital.

Matz pointed out that HarborOne is not near its member business lending cap and could petition the state to expand its geographic boundaries.

NCUA has found that credit unions generally offer lower rates on consumer loans than banks. Credit unions that have converted to banks historically offered even higher rates than most other banks, said the article.

Matz told the Globe there is no organized opposition among HarborOne's members so she expects its members would approve the merger.  "I just think it's not going to be in the best interests of their members," she emphasized.

According to NCUA statistics, 20 of 28 credit unions that converted to a mutual bank since 1995 subsequently became stock-owned banks, a move that is controversial because some maintain this creates a windfall for bank executives and leaves the bank vulnerable to a takeover, said the article.

Mich. House passes CU-backed small-claims bill

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LANSING, Mich. (5/8/12)--Legislation supported by the Michigan Credit Union League (MCUL) to increase Michigan's small-claims court threshold moved one step closer to becoming law, with the state House of Representatives passing the measure on a 107-2 vote.

SB 269 was introduced by state Sen. Tonya Schuitmaker (R-Antwerp Township) (Michigan Monitor May 7).

The legislation was amended two weeks ago to provide for an immediate increase to $5,000 from $3,000, followed by four $500-increases occurring every three years.

The MCUL-supported amendment, offered by state Rep. Peter Pettalia (R-Presque Isle) helped the legislation advance through the House Judiciary Committee, providing necessary bipartisan support from the panel's members prior to consideration by the full House.

The amended legislation now heads to the state Senate for approval, prior to going to Gov. Rick Snyder for final consideration.

If approved by the governor, Michigan's new $5,000 threshold would surpass those of more than 20 states, significantly increasing access to the state's small-claims court for consumers and businesses, MCUL said.

The Senate is likely to consider the amended legislation as early as next week. MCUL said it continues to encourage the governor to sign the measure.

CUs tell Mich. House committee about fin lit efforts

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LANSING, Mich. (5/8/12)--Michigan credit unions marked the end of Financial Literacy Month in April by going to the state House Banking and Financial Services Committee, where they testified about all the things credit unions do to support financial knowledge, according to the Michigan Credit Union League (MCUL).

Beth Troost, left, financial education coordinator at the Michigan Credit Union League & Affiliates, and Jennifer Slaughter director of marketing at CASE CU in Lansing, explain some of the efforts by credit unions to increase financial literacy to the state House Banking and Financial Services Committee.
Beth Troost, MCUL financial education coordinator, told members of the committee that Michigan credit unions lead the nation in youth financial education. Those efforts start with the 366 student credit union branches operated by 57 Michigan credit unions (Michigan Monitor May 7).

During the 2010-2011 school year, nearly 50,000 students attended one of 1,909 classroom financial literacy programs conducted by Michigan credit unions.

She highlighted several credit unions that have won industry awards for financial education programs, including:

  • Michigan Schools & Government CU in Clinton Township, which was recognized for providing monthly financial education seminars to hundreds of adult members and free financial counseling to members struggling with money management;
  • Public Service CU in Romulus, which won a national award for its youth financial education outreach; and
  • Extra CU in Warren, which brings the curriculum of the National Endowment for Financial Education to teachers and students at seven high schools in five school districts.
Michigan House Banking and Financial Services Committee members listen to Beth Troost, financial education coordinator at the Michigan Credit Union League & Affiliates, and Jennifer Slaughter, director of marketing at CASE CU in Lansing, highlight the many ways credit unions support financial literacy. (Photos proved by the Michigan Credit Union League)
"These financial education outreach activities, coupled with credit union products geared toward helping members build assets, avoid excessive fees and use debit appropriately, will continue to make a positive impact in the financial lives of Michigan consumers," Troost said.

Jennifer Slaughter, director of marketing at CASE CU in Lansing, told the committee her credit union supports financial education for everyone from elementary children to senior citizens.

CASE offers seminars and workshops that are free to the public, with 20 to 25 people normally attending each one. Session topics have included Identity Theft, How to Buy Your First Car, Teaching Your Child the Importance of Saving and Credit Card presentations at Lansing Community College.

CASE has reached more than 1,500 students with financial education topics at 63 presentations in area schools thus far in 2012.

"Teachers understand that a lot of their students are missing the message of financial literacy at home," Slaughter said.

Bethex FCU lends hand to South Bronx business

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NEW YORK (5/8/12)--Bethex FCU, Bronx, N.Y., last week helped a long-time member purchase the property that houses his retail business with a $1.2 million member business loan (MBL), the largest loan in the credit union's 42-year history.

The loan enabled Abdul Nashir to secure the building that houses his New Orleans 99 Cent Store and Soundview Laundromat enterprises in the Soundview section of the South Bronx.

"This closing is a milestone in our commitment to community revitalization," said Joy Cousminer, CEO and founder of Bethex FCU.

Bethex FCU underwrote 50% of the loan with the Bronx Initiative Corp. providing 40% of the financing. Nashir contributed 10%.

Lawyers Alliance for New York and Linklaters, LLC acted as counsel to the credit union on a pro bono basis, said Bethex.

Bethex FCU, a community development credit union serving more than 5,000 members with assets of $30 million, has been granting Small Business Administration (SBA)-guaranteed loans since 1999. The credit union was named among the top SBA lenders in New York for 2011 by Crain's New York Business. During the 2011 fiscal year, Bethex FCU granted 18 SBA loans with a value of $2.5 million.

The Credit Union National Association (CUNA) and credit unions are urging Congress to increase their MBL cap to 27.5% of assets from 12.25%, to allow credit unions to make more loans. CUNA estimates that lifting the cap would infuse $13 billion into the economy through small business loans and help create 140,000 jobs.

Marylands savings raffle law kicks in next month

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BALTIMORE (5/8/12)--A new Maryland law takes effect June 1 that will allow credit unions and banks to offer raffles with cash prizes to promote member/customer savings.

In Michigan, credit unions began a similar campaign that resulted in thousands of depositors saving tens of millions of dollars (The Baltimore Sun May 6). 

Members of Michigan credit unions saved $34 million in 2011 through the statewide Save to Win program. Launched in 2009, Save to Win offers cash prizes to persuade families to save money instead of spending it on the lottery or other games of chance (News Now Feb. 23).

"We were very involved in this effort two years ago, but the Maryland bankers attached an amendment to it," Ricardo Pineres, vice president of advocacy for the Maryland and District of Columbia Credit Union Association, told News Now.

At that time, the state passed a similar law allowing financial institutions to offer savings promotion raffles with a caveat--which was due to banks' fear that federal regulations would keep them from offering lotteries, the Sun said. An amendment was added to the law, which stipulated the law would only take effect if federal rules were revised so banks also could participate.

"This time, we spoke to the bill's sponsor and decided to back off," Pineres told News Now. "The sponsor wanted to get bankers on board. But we were there to help testify on how it would affect state charters versus federal charters."

House Bill 786 was sponsored by Maryland House Delegate John Olszewski (D-6).

What comes next remains to be determined, Pineres said. "We haven't had a discussion on how we will move forward with the legislation," he explained. "The law still requires no purchase necessary for all entrants in the raffle. It also requires the approval of the state financial commissioner before it starts.

"The association is going through the language [in the law] to see if it can be a large-scale promotion [driven by the association] or if it will be a credit union-by-credit union implementation," Pineres added.

CU meets net-worth restoration goal two years early

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PORTLAND, Ore. (5/8/12)--Point West CU, Portland, Ore., achieved a net worth of 6% in the first quarter, just three years after self-initiating a prompt corrective action plan approved by the National Credit Union Administration.

The $88 million asset credit union also maintained a high level of member satisfaction, with 88% of responding members saying they would refer family and friends to Point West, and 76% saying they consider it to be their primary financial institution. Also, 90% gave the staff good or excellent ratings, according to the Northwest Credit Union Association (Anthem May 4).

The net worth restoration plan included a dual CEO arrangement, with Amy Nelson and Nick Hodson leading the credit union.

The plan also included adjustments to the lending program, a rebranding initiative and technology and website updates, Nelson said.

Staff was trimmed to 29 employees from 57.

Hodson and Nelson cited the assistance and advice from credit union partners, including the Northwest Credit Union Association; OnPoint Community CU, Portland; Oregonians FCU, Milwaukie; MaPs CU, Salem; Unitus Community CU, Portland; and Advantis CU, Milwaukie.

Hodson and Nelson specifically cited Unitus Community CU CEO Pat Smith for her mentorship.

The net-worth improvements have allowed Point West to offer more competitive products and services to its members. Members will be rewarded with a 1.49% annual percentage rate on 36-month auto loans, double credit card points and an annual percentage yield of 2.5% paid on checking accounts with balances of up to $25,000.

PCUA presents testimony for state payday loans

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HARRISBURG, Pa. (5/8/12)--The Pennsylvania Credit Union Association (PCUA) provided testimony Thursday during a State House Consumer Affairs Committee hearing on payday lending.

The legislation, sponsored by state Rep. Chris Ross (R-Chester), requires persons making short-term or renewing loans to obtain a license from the state Department of Banking, outlines requirements for short-term lenders and protections for consumers, and establishes a Commonwealth Financial Literacy Account within the Pennsylvania Banking Department Fund, the PCUA said (Life is a Highway May 7).

The association submitted written testimony about the Credit Union Better Choice program, a payday lending alternative product in which credit unions offer borrowers a 90-day loan with a $500 limit. The PCUA's testimony included the most current statistics of the program.

Credit Union Better Choice was developed jointly by the PCUA, Pennsylvania Treasury Department and the Pennsylvania Department of Banking.

A typical $500 payday loan costs consumers $15 for every $100 borrowed for two weeks, or about $450 for 90 days. A $500 Credit Union Better Choice loan costs consumers

roughly $42.50 for 90 days, and at the end of the loan term, the consumer has $50 in a savings account, said PCUA.

Since launching in 2006, more than 53,000 Credit Union Better Choice loans have been issued to credit union members for short-term cash needs, the PCUA said in its testimony. The 79 participating credit unions have issued 53,714 loans for roughly $26 million dollars. The program has saved borrowers more than $18 million, compared with using a traditional payday lending product.

Mike Mercer elected vice chair of NCB board

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WASHINGTON (5/8/12)--Credit Union National Association Chairman Mike Mercer, who is also president/CEO of the Georgia Credit Union Affiliates, was elected Thursday as vice chair of NCB,  the financial services company serving cooperatives in the U.S., during its annual meeting in Washington, D.C.

Elected chairman for 2012 was Al Plamann, president/CEO of Unified Grocers, Commerce, Calif.  Mercer will be in line to become chairman of the group after his term as chairman at CUNA expires in 2013.

The annual meeting also celebrated the 2012 International Year of Cooperatives (IYC), which was formed under a United Nations declaration. IYC is a global effort to educate the public on the benefits of cooperatives.

NCB's  board members are from different industries where cooperatives play an important role.

In addition to Mercer and Plamann 2012 board members are:

  • Stuart Saft, partner, Holland and Knight LLP, New York;
  • Ray Moncrief, executive vice president and chief operating officer, Kentucky Highland Investment Corp., London, Ky.;
  • Peter A. Conrad, president/CEO of The Co-operative Central Bank, Boston;
  • Jane Garcia, CEO of La Clinica de La Raza, Oakland, Calif.;
  • Janis Herschkowitz, president/CEO of PRI Inc., Cornwall, Pa.;


  • Kenneth Rivkin, managing director, 227 East 57th Street Corp. New York;
  • Robynn Shrader, CEO, National Cooperative Grocers Association, Iowa City, Iowa;
  • Walden Swanson, CEO, Co-op Metrics, Andover, Mass.;
  • Nguyen Van Hanh, professor of economics, California State University, Sacramento, Calif.;
  • Doug Wille, chief financial officer of Wakefern Corp., Keasbey, N.J.; and
  • Judy Ziewacz, former executive director, Wisconsin Office of Energy Independence, Madison, Wis.

CU System briefs (05/04/2012)

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  • FAIRBANKS, Alaska (5/7/12)--An Alaska woman was sentenced Tuesday to 10 years in jail after a plea bargain for crimes that included robbing Fairbanks-based Alaska USA CU on Jan. 30.  Jessica Nel Brown, 33, of Fairbanks, pleaded guilty to one count of first-degree felony robbery. Other charges involving identity theft to obtain prescription pills were dismissed. In the robbery, Brown allegedly passed a threatening note to a teller and escaped with $4,275. She was arrested later that day and the money was recovered, according to Fairbanks police (newsminer.com May 1) …
  • NEW CASTLE, Pa. (5/7/12)--A second woman has been indicted in connection with an embezzlement  of more than $1,000 at the defunct Lawrence County School Employee FCU in New Castle, Pa.  Stacy L. Attisano, 42, Portersville, former assistant manager at the credit union, faces five counts of embezzlement and income tax evasion for the years 2006-2009, announced the U.S. Attorney's Office in Pittsburgh.  She faces a maximum sentence of 50 years in prison, $2 million fine or both.  In April, the credit union's former CEO and board member, Holly Cowan of Ellwood City, pleaded guilty to embezzling and tax evasion. She allegedly admitted stealing $222,888 from the credit union and filing a false income tax return for 2009.  Her sentencing is scheduled for Aug. 17. She faces a maximum sentence of 30 years for the embezzlement and another five years for tax evasion, as well as fines and restitution costs. The National Credit Union Administration shut down the credit union in March 2010. First Choice FCU agreed to take over the defunct credit union's accounts and operations. In the final quarter of 2009, it had a net loss of $3.4 million (New Castle News May 2) …
  • JANESVILLE, Wis. (5/7/12)--A former loan officer of Parker Community CU, Janesville, Wis., has been sentenced to eight years in federal prison and eight years of extended supervision, for fraud. Laura A. Powers, 51, of Janesville, was charged with using her position to take out more than $600,000 in loans in other people's names. In February, Powers pleaded guilty to one count of theft of more than $10,000 in a business setting and four counts of identity theft. The court dismissed six other ID theft counts but read them into the record for purposes of restitution. She had faced a maximum sentence of 70 years in prison. (The Janesville Gazette May 2) …

IL.A. TimesI Islanders moved money love their CU

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VASHON ISLAND, Wash. (5/7/12)--Far from the Occupy Wall Street movement, a group of people on small Vashon Island, Wash., have become the darlings of the Move Your Money campaign, according to the  Los Angeles Times. What did they do?  They formed a credit union branch, and it was love at first sight.

In an article entitled, "Islanders move love and money to their own credit union," the Times points out that "Fed up with corporate indifference, a green haven in Puget Sound, Wash., finds a novel way to snub big banks."

Vashon Island has 11,000 residents living among its fir forests, lavender fields, organic farms, a tofu factory and a monastery that makes its own coffee. A group of Vashon activists decided that instead of going through a capital intensive process of chartering their own credit union, they would offer to merge with Puget Sound Cooperative CU to get a branch on the island. According to the Times, the credit union "has been a hit with islanders fed up with impersonal corporate banks."

The credit union turned out to be an easy sell to local residents. In its first year, the branch office  managed "to enroll an astonishing 16% of the population and collect local deposits of almost $20 million," the Times reported. The fast growth took some on the organizing committee by surprise. Committee member Rob Harmon told the newspaper: "We had wild dreams that in the first year $10 million would move … And in the first year, $17.5 million moved. So we're 70% above our wildest dreams."

The credit union still needs to grow in loans. It has written about $6.5 million in home loans on the island and about $2 million in other kinds of loans. But it is seeing growth in mortgage loans and energy-efficiency loans.

The Times noted that last year 1.3 million people across the U.S. joined credit unions. The anti-Wall Street movement has "kicked that trend into high gear, painting credit unions as the financial equivalent of eating home-raised chickens," the Times wrote.

The article reported several stories of people who moved their money to the credit union after negative experiences at their banks. An artist and acupuncturist joined after she tried to get an extra copy of her Chase bank statement and was charged for it. Since becoming a member of the credit union, she has bought the small cottage she had rented for years.  A local bartender and her husband--both steadily employed--left their bank after being told they couldn't have a credit card with more than a $300 limit. Earlier they had been turned down for an auto loan. The credit union approved their loan application.

The move toward credit unions is part of a wider search for banking alternatives, said the Times. It discussed tiny $5.4 million asset Permaculture CU, in Santa Fe, N.M., which makes earth friendly and social responsible project loans, and noted that San Francisco Occupy activists are trying to form a credit union to provide low-interest loans to students, families and businesses.

To read the full article, use the link.

Eleven CUs receive CDFI designations

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NEW YORK (5/7/12)--Eleven credit unions were certified as community development financial institutions (CDFIs) by the U.S. Department of the Treasury in the first quarter, nearly matching the 12 credit union certifications in all of 2011.

Ten of the newly certified credit unions are members of the National Federation of Community Development Credit Unions, and seven received direct certification assistance from the federation's CU Breakthrough consulting service.

The new CDFI-certified credit unions are:

  • 1st Valley CU, San Bernadino, Calif.;
  • Cross Valley FCU, Wilkes-Barre, Pa.;
  • ERDA FCU, New York;
  • Financial Health (Clarian) FCU, Indianapolis;
  • Forward Financial CU, Niagara, Wis.;
  • Manatee Community FCU, Brandenton, Fla.;
  • Mid-Cities Financial CU, Compton, Calif.;
  • Military and Civilian FCU, Fort Wainwright, Ark.;
  • Nueva Esperanza Community CU, Toledo, Ohio;
  • UBC Southern Council Industrial Workers FCU,  Minden, La.; and
  • Xavier University Employees FCU, New Orleans.
 

The CDFI designation, which certifies the community-based lenders as providers of critical services to low- and moderate-income communities and other target markets, allows certified institutions to apply for grant funding from the CDFI Fund and other sources to expand their services and increase their impact.

Established by the Riegle Community Development and Regulatory Improvement Act of 1994, as a bipartisan initiative, the CDFI Fund provides certified CDFIs with monetary awards and the allocation of tax credits to promote access to capital and spur local economic growth in urban, rural and reservation-based low-income communities nationwide.

The CDFI Fund has provided almost $1.3 billion to CDFIs nationally, including $120 million to CDFI-certified credit unions since 1996, according to the federation.

Cabot Community Tour touts co-ops CUs along East Coast

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CABOT, Vt. (5/7/12)--Cabot's 2012 East Coast Community Tour to celebrate the International Year of Cooperatives (IYC), sponsored by Cabot Creamery Cooperative in Vermont, begins this weekend in Florida. The two-month program will honor and celebrate farmers, cooperatives, credit unions and volunteer groups who take time to strengthen their communities.

Community Tour participants--including credit unions--will bike and ride 2,300 miles along the East Coast Greenway, making major weekend stops in cities from Florida to Maine from May to July, said the Association of Vermont Credit Unions (Newslines Express May 4).

Cabot Creamery Cooperative is one of the sponsors of the Credit Union National Association's Weekly Home & Family Finance Radio Show

There will be free events with family-friendly activities at public parks and festivals in Miami; Charleston, S.C.; Durham, N.C.; Fredericksburg, Va.; Wilmington, Del.; New York City; Providence, R.I.; and Portland, Maine. Cabot and its fellow sponsors and supporters will celebrate the importance of cooperatives and volunteerism.

The tour will depart from Miami on May 12, pass through every state along the Atlantic coastline, finishing in Portland, Maine, on July 7.

In addition to small events during the weeks, weekend stopover highlights in major cities include a Children's Festival in Charleston, S.C., an outdoor fun base camp in New York City's Central Park, and the Grand Finale in Portland, Maine, where a multinational children's chorus will entertain as the riders finish their journey. That's also where Cabot will announce its Reward Volunteer Grand Prize winners.

Also, credit union volunteers in the North Carolina Research Triangle area of Chapel Hill-Durham-Raleigh will join to participate in a Co-op-A-Fair event in Durham on June 2, according to the North Carolina Credit Union League. Several Co-op-A-Fairs are planned along the tour route.

North Carolina's Team Little Guy will ride the route for 366 miles in North Carolina to raise money for the Charlotte-based Levine Children's Hospital Rooftop Garden Renovation project. When the 2012 Democratic National Convention ends, credit unions will leave behind a rejuvenated children's playground on the rooftop of the hospital. The Credit Union National Association, state credit union leagues, credit unions nationwide and the National Journal are working with the Democratic National Convention Committee to complete the project in time for the September convention (News Now April 6).

Illinois foundation awards 42880 in grants

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NAPERVILLE, Ill. (5/7/12)--The Illinois Credit Union Foundation awarded $42,880 in Small Credit Union Development (SCUD), Community Service, Marketing and Business Development, and Financial Independence & Revitalization Effort (FIRE) grants.

SCUD grants totaled $17,880 and were awarded to nine credit unions. Purposes for the SCUD grants included technology upgrades, office equipment, marketing materials and upgrading security systems. The recipients were:

  • Chicago Fire Officers' Association CU;
  • Decatur (Ill.) Policemen CU;
  • Elgin (Ill.) Mental Health Center Employees CU;
  • Kaskaskia Valley Community CU, Centralia;
  • Oak Lawn (Ill.) Municipal Employees CU;
  • Parish Members CU, Metamora;
  • Peoria (Ill.) Journal Star CU;
  • Springfield (Ill.) City Employees CU; and
  • Urbana (Ill.) Municipal Employees CU.
The foundation also awarded $2,000 in Community Service Grants. Credit unions and chapters can qualify for grants by hosting an established event, creating an event, or volunteering at an established event. Community service grants went to: the Danville Area Chapter, the Bloomington Chapter, Alton (Ill.) Bell Community CU and Altonized Community CU, Alton.

Also, six credit unions received Marketing and Business Development grants that totaled $21,500. The recipients were:

  • Alton Bell Community CU;
  • Altonized Community FCU;
  • Armstrong Preferred Members FCU, Bourbonnais;
  • C.T. Community CU, Fairmont City;
  • Rockford (Ill.) Municipal Employees CU, and
  • SIUE CU, Edwardsville.
The grants were established in 2006 to help credit unions with assets of up to $30 million start or expand outreach efforts. The maximum grant award is $5,000 per credit union per year.

One credit union received a $1,500 FIRE grant. FIRE grants provide assistance to credit unions expand their ability to build and maintain viable communities by providing credit and financial services to residents and businesses in low-income and underserved areas of Illinois. Park Manor Christian Church CU, Chicago, will use its FIRE grant for financial education--specifically to bring financial reality fairs to credit union members and the community.

There are two more grant request deadlines in 2012--July 31 and Oct. 31, said the foundation. Also, scholarships are reviewed while funds last. Online and downloadable grant request forms are available on the league's website. Eligibility is limited to Illinois credit unions and chapters.

Story of NIH FCUs growth told in Maryland paper

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ROCKVILLE, Md. (5/7/12)--More than 90% of new business at the National Institutes of Health FCU is Web-based, an increase from 5% in 2009, when President/CEO Juli Anne Callis arrived, according to The Gazette (May 4).

Callis has committed NIH FCU to growth through innovation. The credit union has grown to $560 million in assets and about 44,000 members, with 10-branches in Maryland, Washington, District of Columbia, Virginia and West Virginia--with annual growth rates of 34% in assets and 10% in membership since Callis took over.

Callis has a personal connection with National Institutes of Health, the federal medical research agency served by the credit union. She lost her son Adam, 10 years old at the time, to cardiomyopathy, a disease that causes inflammation of the heart muscle.

Her husband, Charles, and daughter, Lisa, later acquired the disease. Charles underwent a heart transplant. Lisa acquired a defibrillator. Both are doing well, Callis said.

Callis has expanded NIH FCU's lending footprint to include business loans, the result of feedback from focus groups.

Focus group input is also among reasons for the credit union's online growth.

Before she arrived at NIH FCU, Callis had experience leveraging technology to serve credit union members. At KeyPoint CU in Santa Clara, Calif., where she served as chief operating officer and president of its mortgage credit union service organization, Callis helped serve high-tech companies such as Apple and Google.

NIH FCU's branches have also been modernized. One branch features an open design with a video kiosk and offers members paperless transactions, remote deposit capture and mobile banking.

Callis also has innovated NIH FCU's work force, putting in place leadership training that allows employees to branch into different areas and develop new skills.

Despite her belief in the modern touch, Callis told The Gazette NIH FCU maintains the credit union personal touch of building "deeper, more intimate relationships" with members.

CUANY annual state scholarships awarded

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ALBANY, N.Y. (5/7/12)--The Credit Union Association of New York (CUANY) awarded $13,000 in scholarships to 20 college bound students through its annual scholarship program.

The association awarded six $1,000 scholarships and 14 $500 awards. Scholarship applicants competed against other credit union members statewide. Judging was based on academic performance, extracurricular and community activities, and an essay question.

High school seniors who belong to a credit union and were planning to attend college for the first time were eligible for the scholarships.

CUANY received 1,886 applications through 102 credit unions and association chapters. The winners came from 10 of the association's 14 chapters.

Many chapters and credit unions will also award their own scholarships.

Williams joins West. CUNA Management School board

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CLAREMONT, Calif. (5/7/12)--Darren Williams, president/CEO of Wescom CU in Pasadena, Calif., is the newest member of the Western CUNA Management School (WCMS) Board of Trustees.

Comprising nine credit union CEOs, two league presidents, the WCMS president, and WCMS provost, the board is responsible for oversight and direction of the school.

Williams also serves as president/CEO of Wescom Holdings LLC, a holding company of Wescom CU's insurance, investment, mortgage lending and technology subsidiaries.

He is on the Credit Unions for Kids Advisory Board for Children's Hospital of Los Angeles and is chairman of the Credit Unions for Kids Wine Auction, a major fundraiser for the Children's Miracle Network Hospitals in California and Nevada.

Williams has served in the credit union movement for more than 27 years. 

WCMS is sponsored by the leagues of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming, in cooperation with Pomona College in Claremont, Calif.

CU in political power center goes extra mile for MBLs

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TACOMA, Wash. (5/7/12)--A Tacoma, Wash.-based credit union situated in a political power center has gone the extra mile to make sure that elected leaders and key political groups know it supports lifting the member business lending (MBL) cap for credit unions.

Even though  IBEW #76 FCU doesn't offer MBLs--yet--it got creative with its situation and hung a banner (see photo)  asking its senators to support S. 2231, legislation that would raise the MBL cap to 27.5% of assets from 12.25%, reported the Northwest Credit Union Association in its newsletter, Anthem (May 4).

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The credit union, founded in 1957 by a group of electricians to serve the International Brotherhood of Electrical Workers Local 76 members and their families, is located in the same building as important elected leaders, the Pierce County Democratic Party headquarters and three unions. Many of the officials travel through the credit union lobby to get to work.

Thus, the banner, which urges senators to "Please support S. 2231 so credit unions can make more small business loans.  It's about jobs."

"We don't currently offer any MBLs, but what an opportunity to get our message out," said CEO Sheila Augustine. "Our branch is in the building housing the local Democratic Party, the Pierce County Labor Council and several unions. When politicians go on their Neighbor-to-Neighbor walks in this area, they start here. This is their power center."

Augustine said both U.S. Sens.  Maria Cantwell (D) and Patty Murray(D),  Gov. Christine Gregoire and gubernatorial candidate Jay Inslee have all visited recently.

For her newfound passion for raising the MBL cap, Augustine tells a story about her inability to serve two members who approached her for small business loans.

"IBEW #76 FCU doesn't currently offer MBLs, but this fight has opened my eyes and my board's eyes to the possibility that offering them to union members represents a possible road to future growth," she said. "So many union electricians are out of work --a small-dollar MBL would help them start their own businesses so they would have a chance to succeed."

Ohio leagues i48 conference unveils small-CU program

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COLUMBUS, Ohio (5/7/12)--More than 470 leaders from 125 Ohio credit unions gathered in Columbus, Ohio, for InVest48, the Ohio Credit Union League's annual convention, during which the league unveiled its new entity for small credit unions--the Haynes Circle.

At the direction of the Small Credit Union Success Task Force, the league created a single umbrella under which all things related to small credit unions can be easily identified and which accurately portrays the thriving community of small credit unions, the league said (eLumination Newsletter May 2).

The league noted the Haynes Circle is more than what the league provides, but is tailored to the challenges and needs of  257 smaller credit unions.

The Haynes Circle was named after Rita Haynes, who recently retired as CEO of Faith Community United CU, after 50 years of service. Faith Community is a $12 million asset credit union in Cleveland.

InVest48's agenda included multiple keynoters and special guests,  including Credit Union National Association President/CEO Bill Cheney and Gov. John Kasich. Cheney discussed the rise of credit unions, noting their survival during tough times, their rising capital and income levels, the highest favorability ratings every among members and nonmembers, and a net gain of 1.3 million new members in 2011. Gov. Kasich spoke about the accomplishments of the state the past two years and current initiatives.

Juan Williams, political analyst for Fox News and i48 keynoter, told credit unions attending,  "You're where change starts …people who make a difference." He encouraged credit unions to continue leading and adapting to today's environment of economic and demographic influx.  He also noted two powerful political and demographic forces that everyone--including elected officials and credit unions--would be wise to understand: the generational divide between those under age 35 and those over 65, and the rising influence of women.

During the event, Jerry Guy, CEO of KEMBA Financial CU, Gahanna, was presented with the 2012 Professional of the Year award.

The event featured 17 breakout sessions and nearly 80 vendor exhibits, and meetings with public officials, said the league.

Guatemalan CUs meet with Calif. assemblywoman

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SACRAMENTO, Calif. (5/4/12)--Five Guatemala credit union professionals met with California state Assemblywoman Norma Torres (D-61) in Sacramento recently to discuss the credit union difference in the U.S. and Guatemala.

Click to view larger image From left, front row:  intern Rene Lopez, California and Nevada Credit Union Leagues President Diana Dykstra, California state Assemblywoman Norma Torres, and intern Carlos Mucun. Back row: Interns Roberto Monge and Derik Martinez; San Francisco FCU CEO Steven Stapp; Nikkei CU CEO Erick Orellana; intern Carlos Paredez, and SCE FCU Director of Community Relations and Business Development Pascual Garrido. (Photo provided by the California and Nevada Credit Union Leagues)
They were in California as part of the World Council of Credit International Credit Union Leadership Program, which is part of the State Department's larger Professional Fellows Program. The program is supported by a grant from the U.S. Department of State, Bureau of Educational and Cultural Affairs, Office of Citizen Exchanges.

Six interns were hosted by these credit unions:  Family FCU, Wilmington; Nikkei CU, Gardena; Patelco CU, Pleasanton; San Francisco FCU; SCE FCU, Irwindale; and Water and Power Community CU, Los Angeles.

Rene Lopez, Derik Martinez, Roberto Monge, Carlos Mucun and Carlos Paredez attended the California and Nevada Credit Union Leagues' Government Relations Rally April 24 in Sacramento and visited with Assemblywoman Torres, the first person of Guatemalan descent to serve in the state legislature.

Mucun, who is branch manager at Colua R.L. CU and was hosted by Family FCU, said of the visit with Torres: "We appreciated the time she took to listen to us; we all had the chance to speak about our credit unions in Guatemala."

Roberto Monge, human resources director with Federacion Nacional de Cooperativas de Ahorro y Credito, Guatemala's credit union trade association, noted all the advocacy work the leagues do. "It's an excellent organization…everything is well planned and, above all, you have clear and well-defined objectives. It was a pleasure to see so many credit union people working together behind a common objective." He was hosted by Patelco CU.

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. In addition, participants focus on finding new ways to attract younger members to their credit unions.

Young CU pros active in La. Minn. Del.

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MADISON, Wis. (5/4/12)--Young professionals have been a busy lot lately, crashing conventions, forming networks and making plans to put their footprint on the credit union movement. Recently they were active at meetings in three states--Minnesota, Delaware and Louisiana.

Members of the Minnesota Credit Union Network's (MnCUN) young professional group, the Crew, received insight from industry experts April 14 during MnCUN's annual meeting.  Credit Union National Association (CUNA) President/CEO Bill Cheney, MnCUN President/CEO Mark Cummins and credit union branding expert Mark Arnold provided career advice and wisdom to the group, whose members are aged 35 or younger.

Cheney encouraged the Crew members to take responsibility for their careers by finding a mentor "who is willing to invest their experience in your career," and challenged them to strive to be industry leaders--regardless of their current position. "Don't be afraid to be a leader," Cheney said. "Don't be afraid to do what's right, even if it is not popular or exactly profitable."

Young professionals attending the Delaware Credit Union League annual convention included, from left, front row: Kristin Gregory, Tania Peralta, Vernonica Nhan-Nock and Tara Merwin; back row: Tanya McDaniels, Kevin Murphy, Shallyn McGinnis, Ashley Cole, Rikki Handy, Amanda Carrozza, and Amy Minckler. Not pictured: Heather Nasatka. (Photo provided by the Delaware Credit Union League)
Cummings urged attendees to take full advantage of networking opportunities offered at chapter meetings and other industry events. Emphasizing the importance of pursuing and embracing challenges, Cummins stressed the value of taking risks in one's career. "Sometimes you have to take a big leap in your career--even when you don't know how it will turn out," Cummins said. Career "leaps of faith" often lead people directly to where they were meant to be, he added.

Arnold built on that advice, encouraging young professionals to follow their passions, even if they don't know where it will take them.

The Crew also participated in a networking pizza party during the annual meeting to connect with other young credit union professionals from around the state. MnCUN said it will continue to provide programs and activities aimed at helping young professionals to grow professionally.

In Delaware, 12 young credit union professionals were selected to be among the 155 attendees at Delaware Credit Union League's annual convention April 19-21, according to the league (Together April 30). League Education Director Bernadette Hines hosted the 2012 Young Professionals' Network (YPN). Members attended the convention and special networking sessions.  "These young professionals are tomorrow's leaders. The network provides them an opportunity to connect with one another," said Hines.

Attending were:

  • Del-One FCU, Dover--Tanya McDaniels and Shalyn McGinnis;
  • Delaware First FCU, Wilmington--Kevin Murphy;
  • DEXSTA FCU, Wilmington--Tara Merwin and Heather Nasatka;
  • Dover (Del.)  FCU,--Ashley Cole and Rikki Handy;
  • Eagle One FCU, Philadelphia (Claymont, Del.)--Amanda Carrozza;
  • Louviers FCU, Newark --Tania Peralta and Kristin Gregory;
  • New Castle County Delaware Employees FCU, New Castle --Amy Minckler; and
  • Seaford (Del.) FCU--Vernoica Nhan-Nock.
Sixty-two Young Professionals Network  (YPN) members in Louisiana got down to business at roundtables on marketing, compliance, lending and operations at the Louisiana Credit Union League's first YPN workshop (Photo provided by the Louisiana Credit Union League)
The Louisiana Credit Union League hosted its first Young Professionals Network Workshop in Baton Rouge April 21, with 62 YPN members attending (eNews April 25). It aimed to compel young professionals to get involved in the movement, connect them with other young professionals and encourage collaboration to create long-term success for the credit union movement.

YPN Committee Chairman Ronaldo Hardy oriented the group on the YPN vision and benefits, and LCUL Executive Vice President Connie Major provided an overview of the league and its services. Tyler Grodi, CEO of Baton Rouge-based E FCU, discussed his journey from an auditor with an insurance agency for credit unions to CEO.

The group also participated in roundtables on marketing, compliance, lending and operations and heard Brent Dixon, an adviser specializing in young adult issues with the Filene Research Institute, discuss bringing innovative ideas to life.

"Not only were we able to gather more than 60 young professionals on a Saturday, but we were able to ignite a passion in the next generation of our credit union leaders," said Hardy. "Many people expressed how inspired they felt when they left. Our goal is to continue to ignite this drive, passion and energy in our generation for the sustained growth of our Louisiana credit union movement."

The league said there are 180 members of the Louisiana YPN, which is open to any credit union professional in Louisiana aged 40 and under. It emphasized there is no cost to join the network.

CUs assets hit an eye-popping 1 TRILLION

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MADISON, Wis. (5/4/12)--Credit unions in the U.S collectively reached a major milestone--$1 trillion in assets--as of the end of March, according to the Credit Union National Association's (CUNA) monthly sample of credit unions.

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Credit union total assets passed the $1 trillion mark for the first time in March--ending the month at $1.02 trillion. Overall, assets grew by 2.4% in the month and by 4.1% during the past year. Credit union assets have more than doubled since year-end 2000, when they were $450 billion.

"We generally don't see big increases or declines in the monthly data so what we typically report isn't eye-popping, headline-grabbing news--so this definitely is one of the most significant developments we've reported from our survey in quite some time," Mike Schenk, CUNA vice president of economics and statistics, told News Now. "It's especially important because it is a direct reflection of the fact that consumers have been increasingly recognizing and embracing the credit union difference."

As member-owned financial cooperatives, credit unions have no stockholders demanding market rates of return on their investments--so credit unions can take the money that other financial institutions use to reward stockholders and return that directly to depositors and borrowers in the form of higher deposit yields, lower loan interest rates, and fewer and lower fees, Schenk explained.

"In 2011, the direct financial benefits accruing to members because of this difference was estimated to exceed $6.25 billion," Schenk noted. "In other words, on average, credit union members saved $6.25 billion, compared with what they would have if they did all of their business at banking institutions."

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Credit union loans outstanding remained constant during March, after a 0.2% decrease in February, according to the monthly credit union estimates. Fixed-rate mortgages led loan growth with a 1.5% increase, followed by used-auto loans (0.8%) and new-auto loans (0.2%). Credit card loans declined 0.7%, followed by home equity loans (1.0%), adjustable-rate mortgages (1.1%) and unsecured personal loans (1.2%). Credit union loans totaled $585.3 billion in March, compared with $573.2 bilion in March 2011.

Credit union savings balances grew 2.5% in March, compared with a 2.1% increase in February. Share drafts led savings growth with a 6.9% rise, followed by regular shares, money market accounts, and individual retirement accounts, which grew 4.7%, 1.9%, and 1.5%, respectively. One-year certificates declined 0.6%. Credit union savings in March totaled $881billion--or $51.7 billion more than the $829.3 billion in March 2011.

"March data reflect continued strong growth in savings balances and relatively weak loan growth," Schenk said. "Savings grew by 2.5% in March while loan portfolios were essentially unchanged in the month. That translated into even more liquidity."

The loan-to-savings ratio dropped to 66% from 68% in February. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--grew to 22% from 21% in February. Regarding asset quality, credit unions' 60-plus-day delinquency rate fell to 1.5% from 1.6% in February. "This is in line with our expectations," Schenk said, "and is entirely consistent with the improvements we've been tracking in the macro economy--especially the improving labor markets and the resulting marginal gains in consumer income."

The movement's overall capital-to-asset ratio remained at 10%. The total dollar amount of capital is $102 billion.

MBL cap not at issue in lawsuit says CU

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BETHPAGE, N.Y. (5/4/12)--Allegations in the press that the member business lending (MBL) cap of Bethpage (N.Y.) FCU caused it to reject a commercial construction loan that is at the heart of a $55 million lawsuit against it, are erroneous, said the credit union.

"Bethpage FCU has been in ongoing communication with the parties involved and was surprised by the filing of the lawsuit," said Kirk Kordeleski, CEO of the $4.5 billion asset credit union.

He was referring to a lawsuit filed Wednesday by Liberty Meadows of Hauppauge, N.Y., and its managing members Demetrius A. Tsunis and Enrico Scarda in the New York Supreme Court in Suffolk County, N.Y. According to the court documents, the suit alleges fraud, negligent misrepresentation, and breach of contract stemming from the credit union's rejection of a loan to  Liberty Meadows for a development of senior citizen townhouse condominiums.

The suit alleges that the credit union promised it would make a loan for the condo development but the loan committee refused to approve the funding. As a result, the court document said, the project was stalled 15 months and the plaintiffs experienced losses, it said.

"Clearly we believe the suit is without merit and plan to appeal," said Kordeleski. "Like any prudent commercial lender, we engage in a comprehensive analysis before making a loan and decided not to move forward with this one.

Also, "to suggest that Bethpage withheld the loan because it came up against a commercial lending cap is false. Qualified commercial applicants will find we have millions of dollars available for lending," he said.

"We are very comfortable with our position in this case and strongly believe we will prevail," Kordeleski told News Now.

LIBN.com on May 2 had reported comments by the plaintiffs' attorney that the credit union may have bumped up against its MBL cap. And some trade press had reported that the MBL cap is at issue. The cap is not mentioned specifically in the complaint filed, according to court documents. Instead, the document alludes to "lending capacity" and "lending authority."

"Many of the issues referenced in the LIBN article are incorrect, not the least of which is that we are not near our cap or our internal construction lending limits," Kordeleski told News Now. "While we are at 65% of the MBL cap, and will reach that limit over the next three years, the limit did not affect this decision," he said.

The MBL cap issue is a key issue for credit unions. The Credit Union National Association and credit unions are urging Congress to increase their MBL cap to 27.5% of assets from 12.25%, to allow credit unions to make more loans. CUNA estimates that lifting the cap would infuse $13 billion into the economy through small business loans and help create 140,000 jobs.

NEW CUs assets at 1 TRILLION

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MADISON, Wis. (5/3/12)--Credit unions in the U.S collectively reached a major milestone--$1 trillion in assets--as of the end of March, according to the Credit Union National Association's (CUNA) monthly sample of credit unions.

Credit union total assets passed the $1 trillion mark for the first time in March--ending the month at $1.02 trillion. Overall, assets grew by 2.4% in the month and by 4.1% during the past year. Credit union assets have more than doubled since year-end 2000 when they were $450 billion.

Credit union loans outstanding remained constant during March, after a 0.2% decrease in February.  Fixed-rate mortgages led loan growth with a 1.5% increase, followed by used-auto loans (0.8%) and new-auto loans (0.2%). Credit card loans declined 0.7%, followed by home equity loans (1.0%), adjustable-rate mortgages (1.1%), and unsecured personal loans (1.2%).

Credit union savings balances grew 2.5% in March, compared with a 2.1% increase in February. Share drafts led savings growth with a 6.9% rise, followed by regular shares, money market accounts, and individual retirement accounts, which grew 4.7%, 1.9%, and 1.5%, respectively. One-year certificates declined 0.6%.

Regarding asset quality, credit unions' 60-plus-day delinquency rate fell to 1.5% from 1.6% in February.

The loan-to-savings ratio dropped to 66% from 68% in February. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--grew to 22% from 21% in February.

The movement's overall capital-to-asset ratio remained at 10%. The total dollar amount of capital is $102 billion.

Super Savers galore at CUs savings results TBA

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MADISON (5/4/12)--News Now will announce the results of the Credit Union National Association's (CUNA's) National Youth Savings Challenge in its May 21 issue.

Armondo Lopez, with his mother, Mandy, learns about personal finance during a youth budgeting workshop at Santa Cruz (Calif.) County Employees CU. Armondo has attended these workshops for about five years and now helps to teach them. (Photo provided by Santa Cruz County Employees CU)
The 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.

National Credit Union Youth Week, held April 22-28, was also created by CUNA 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."

Here are some of the ways credit unions celebrated National Credit Union Youth Week:

  • In Eugene, Ore., $1 billion asset Oregon Community CU, offered coloring contests, branch tours, double Lucky Duck bucks and treats.
  • AmeriCU, $1 billion in assets, Rome, N.Y.,  partnered with the USO to benefit children of military members. For every new account, a child received a free $5 deposit, and the credit union also donated $5 to the USO in that child's name. The credit union also set a goal of collecting 1,500 books in April for military families at Fort Drum.
  • Heritage FCU, with $426 million in assets, Newburgh, Ind., hosted a youth week website. Among the comic-strip-inspired graphics was information on cape-and-art contests and efforts to support the Ark Crisis Center.
  • To call attention to youth week activities, $1.8 billion asset Grow Financial FCU, Tampa, Fla., posted daily pictures on Facebook of a reinvention of Grant the Ant, the credit union's mascot, dressed up as a superhero around town and in its branches.
  • Click to view larger image SESLOC FCU, San Luis Obispo, Calif, created a Super Saver cutout for kids to put their face through for a photo. (Photo provided by SESLOC FCU)
    Communities of Abilene (Texas) FCU, which has $119 million in assets, hosted 25 elementary students on a credit union tour and mentored 60 children from the Child Development Center on becoming Super Savers through story time and a coloring activity at the Dyess AFB Base branch.
  • Kelly Community FCU, with $84 million in assets, Tyler, Texas, staff dressed up as their favorite superheroes to kick off Youth Week. In addition to receiving free flimsy Frisbees for making deposits, kids could be one of two to win $100 from an essay competition on how they are "Super Savers."
  • Each year in conjunction with youth week, $26 million asset Santa Cruz (Calif.) County Employees CU presents a youth budgeting workshop. Parents may chose to attend with their children and share the experience of budgeting, making family members aware of their financial responsibilities. Students learn the difference between credit unions and banks, wants and needs, basic budgeting and many more tips for managing finances.
  • Branches of $97 million asset Service 1st FCU, Danville, Pa., handed out glow-in-the-dark pencils, bookmarks, tattoos, coloring pages and T-shirts to during youth week, said the Pennsylanvia Credit Union Association (Life is Highway April 30). Children also were encouraged to dress up with props provided by staff at the branches and pose in front of a skyline backdrop as if they were flying over a city. The Ironmen Hub, the credit union's full-service branch located inside the Danville Area High School, kept the Credit Union Super Saver spirit alive after hours by posting the students dressed up as superheroes to the Service 1st Facebook page. Student Services Coordinators Heidi Stradnick and Coleen Snover deliver financial literacy presentations throughout the Danville Area School District year-round, but emphasized the Credit Union Super Saver message during youth week.
  • Click to view larger image Northwoods CU, Cloquet, Minn., announced the arrival of Spidycat--the credit union's Youth Week superhero--on Facebook before she zoomed into branches to interact with youth. (Photo provided by Northwoods CU)
    SESLOC FCU, San Luis Obispo, Calif, created a super saver with a cutout for kids to put their face through for a photo. Staff dressed up as super heroes on Monday and Friday. The credit union gave away a customized "Share, Save and Spend" moon jar savings bank to kids with new accounts, and in the spirit of  sharing, the $526 million assets credit union ran a fundraiser during April to benefit a local food bank program that provides meals to low-income kids during the summer. The credit union donated $6,500 to the program.
  • Louisiana FCU, with $157 million in assets, LaPlace, La., celebrated youth week with two well-attended events. On April 25, teen members at East St. John High School enjoyed popcorn and T-shirts at the in-school branch (Louisiana Credit Union League eNews May 2). Two days later, a special gathering was held for members of the Money Mammals Savings Club. Kids and their parents dined on pizza and snacks while they watched a super hero movie. The event also featured entertainment by a balloon artist and a special appearance by Joe the Monkey, the Money Mammals mascot.
  • Bethlehem (Pa.) Teachers FCU, with $39 million in assets, celebrated youth week by inviting children to have their photo taken in front of the Superhero Wall of Fame. The credit union provided a cape and each Super Saver received a small mask. The youngest participant was only 10 weeks old and was dressed in her own superhero outfit (Life is a Highway April 27).
  • Lebanon (Pa.) FCU, with $170 million in assets, hosted a scholarship breakfast to honor six area high school students who applied for the "future business leaders" scholarship. Each student will receive a check for $500 toward their continued education and a framed award certificate at their high school awards ceremony (Life is a Highway April 27).
  • WEST-AIRCOMM FCU, Beaver, Pa., celebrated youth week with a coloring contest at all three of its branches. Each branch of the $188 million credit union randomly picked a winner for a $15 gift card to a locally-owned toy store. Each child who visited the credit union during youth week received a gift bag loaded with a Super Saver temporary tattoo, rainbow pencil, and a snack.

Biz Kid to premier on American Forces Network

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MADISON, Wis. (5/4/12)--Biz Kid$, the Emmy Award-winning, credit union-funded public television series that teaches kids about money management and entrepreneurship, will premiere June 8 on the American Forces Network (AFN).

Biz Kid$ is donating the first 26 episodes to AFN. The episodes cover personal finance topics such as budgeting, saving, entrepreneurship and credit. 

The Department of Defense operates AFN, a worldwide radio and television broadcast network that serves nearly one million American service men and women, Department of Defense civilians and their families overseas. They are stationed at bases in 175 countries, and 140 U.S. Navy ships at sea.  AFN broadcasts popular American radio and television programs and is a service of the American Forces Radio and Television Service.

The National Credit Union Foundation oversees fundraising, outreach and administrative responsibilities of Biz Kid$, which recently started its fifth season. During the past six years, more than 290 credit unions and affiliated organizations have raised about $13.2 million to support the show's production, website and curriculum.

Every Biz Kid$ episode begins and ends with the narrator reminding viewers: "Production funding for Biz Kid$ is provided by America's Credit Unions, where people are worth more than money."

BTD offers lesson to Russian CU leaders

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ST. PETERSBURG, Russia (5/4/12)--Global credit union trends, including a look at the success of social media in promoting Bank Transfer Day (BTD) in the U.S., formed the focal points of presentations given by members of a World Council of Credit Unions (WOCCU) delegation who spoke at the sixth Russian Credit Union Forum, held last week in St. Petersburg.

Social media made a difference in helping the success of Bank Transfer Day, Credit Union National Association Executive Vice President and General Counsel Eric Richard (center) told participants at the recent Russian Credit Union League Forum in St. Petersburg. The group included, from left: World Council of Credit Unions (WOCCU) President/CEO Brian Branch, WOCCU Second Vice Chair and Louisiana Credit Union League President/CEO Anne Cochran, Richard, Russian Credit Union League Acting CEO Tatiana Ivashkina and administrative staffer Natalia Vydrina. (Photo provided by the World Council of Credit Unions)
The three-day event, hosted by the Russian Credit Union League, a WOCCU member, attracted participants and speakers from throughout Eastern Europe, the U.S. and Ireland. While many issues were specific to Russian credit unions, several themes emerged that pose challenges for credit unions everywhere, according to Brian Branch, WOCCU president/CEO, who led the delegation.

"The global credit union movement has made significant strides during the past few years and in the wake of the global financial crisis," said Branch, who offered an international credit union perspective to attendees as part of the event's opening plenary session. "The ability to keep pace with market growth and meet emerging issues head-on remains the challenge facing credit unions everywhere."

The U.S. delegation also included World Council Second Vice Chair Anne Cochran, president/CEO of the Louisiana Credit Union League; Rod Taylor, president/CEO of Barksdale FCU, Bossier City, La.; and Eric Richard, executive vice president and general counsel for the Credit Union National Association (CUNA), World Council's U.S. member.

The Russian and Louisiana leagues have been paired as part of WOCCU's International Partnership Program since 2007. Also, Barksdale FCU is partnered with Russia's Altai Credit Union Association, further strengthening the tie among the organizations.

Cochran spoke about the role played by credit union trade associations in helping build their members' identities in the marketplace. She also addressed the rise of new technologies and provided her own perspective on U.S. credit union practices.

Taylor participated in a panel that looked at ways to attract youth members to credit unions, a perennial challenge for credit unions around the world.

The importance credit unions play in a free-market economy and social media's role in fostering credit union growth became the focus of Richard's session. He discussed the origins of BTD and how it grew from a social movement into a significant win for U.S. credit unions.

"I have been asked to speak to you about why Americans are switching from banks to credit unions," Richard said. "Perhaps the greater mystery is why more Americans didn't take this step much sooner."

The global economic crisis, which began in the fall of 2008, caused financial hardships for countries worldwide, particularly the U.S. The role of commercial banks in fostering the crisis has been well-documented, which gave credit unions a growing market advantage and began increasing member growth. The dissatisfaction of California art gallery owner Kristen Christian with a $5 monthly debit card fee imposed by Bank of America led to a call on social media outlet Facebook for consumers to move their accounts from banks to credit unions on Nov. 5.

BTD joined with Occupy Wall Street and other movements to reflect consumer dissatisfaction with banks and other commercial financial interests. Christian's Facebook campaign is credited with helping increase U.S. credit union growth in 2011 by 1.3 million members, more than double the 600,000 who joined during the previous year, Richard told his Russian audience.

"BTD has truly proven to the credit union movement how much impact one individual can have through the power of social networking," said Richard. "Credit unions hopefully will continue to see positive growth from additional deposits and new members throughout 2012 and beyond, which should help strengthen the credit union movement both in the U.S. and internationally."

Equifax Credit write-offs down home delinquencies at three-year low

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ATLANTA, Ga. (5/3/12)--Credit write-offs for March are 50% lower than in March 2009, when banks wrote off $39.7 billion (excluding home finance write-offs), according to Equifax's March National Consumer Credit Trends Report.  New credit is at its highest point since 2008, and home finance delinquencies are at a three-year low.

The report indicates that the credit landscape is continuing to improve.  At the end of first quarter, U.S. consumer debt totaled $10.9 trillion, down more than 11% from its $12.4 trillion peak in October 2008, said Equifax.

Credit write-offs in March totaled $20 billion. During the recession, the average size of delinquencies increased rapidly when dollar rates outpaced total number of delinquent accounts. That trend has reversed in auto, bankcard, consumer finance and retail card categories, Equifax said in a press release.

More than 72% of total delinquencies  and 36% of balances are from loans originated between 2005 and 2007. Loans opened in 2009 and later performed better, with 12.6% of those delinquent.

New-auto,  bank and retail cards, consumer finance, home equity and student loan credit rose to $61 billion in January, 11% more than January 2011 when new accounts totaled $55 billion.

Key auto loan findings:

  • Auto loan and lease balances rose to a post-recession high of $727.5 billion in March.
  • Auto finance loans totaled more than $380 billion, the highest since third quarter 2009.
  • Delinquency rates among all auto loans are at their lowest in five years.
  • As auto sales rise fast, so do new-auto loans. New-auto loans from banks in January rose to 728,000 accounts, from 630,000 a year ago; those from finance companies grew to 753,000 from 735,500 in January 2011.
Bankcard and consumer finance findings:

  • Outstanding bankcard balances in March totaled $532.8 billion, or  $8 billion less than in March 2011. The drop is modest, compared with the $54 billion decrease from 2010 to 2011.
  • March delinquencies and write-offs on existing bankcards were well below pre-recession levels and the lowest in five years.
  • Available credit--the difference between the credit limits and balances-- climbed to nearly $1.9 trillion in March, the highest since September 2009.
  • New consumer finance loan volume totaled 1.4 million new accounts in January, an 8% increase from a year earlier.
  • Consumer finance loans taken out in January totaled $4.3 billion, a 12.1% increase over January 2011.
Student loans findings:

  • Write-offs, while still elevated from previous years, decreased from March 2011 to March 2012, the first reverse in the trend in six years.
  • In the first decline in three years, the average amount per new loan is $4,548--20% less from the $5,572 in January 2011.
  • Loan amount per student dropped 12% to $6,917 from the same time last year.
  • Borrowers aged 30-39 took out 17% of the nearly 15 million new student loans in January. However, they represent 24% of the total $157 billion in new loans opened in January.
  • Borrowers aged 23 and under took out nearly twice as many student loans (more than 30 million) but accounted for nearly the same dollar amount.
"Aside from home finance, which will require a longer recovery time due to the long foreclosure process, the data reflect the improving U.S. economy as consumers explore new financial options and exercise due diligence in repaying their existing debts," said Equifax Chief Economist Amy Crews Cutts.

On the home mortgage front, the trends report by Equifax and Creditforecast.com, a joint product of Equifax and Moody's Analytics, indicated that total delinquent first mortgage balances in March totaled less than $500 billion--the lowest since January 2009.

As of March, homeowners took out 49.5 million outstanding mortgages, nearly an 11% decrease from the 55 million mortgages made in March 2008. Equifax noted that the decline is caused by high foreclosures and loan payoffs, and low homebuyer demand.

Of delinquencies in existing home equity lines of credit, 79% were from mortgages originated between 2005 and 2007. The number of revolving home equity lines is at a five-year low, with 11.6 million outstanding in March. Credit levels also fell 25% from 2008's peak of $1.3 trillion.

Other mortgage highlights:

  • March mortgage balances were 3.5% below March 2011 balances. The balances have posted year-over-year declines for 36 consecutive months.
  • Of first mortgage delinquencies, 71% were from loans originated in 2005-2007.
  • The share of first mortgages moving to a 30-day past due status is at its lowest since June 2007, while the share of mortgages moving from 60-days past due to 90 days past due is at its lowest level in 59 months.
  • Severely delinquent loans (90 days or more past due) or those starting foreclosure fell the past 24 months ending in March and now stands at $477 billion.
Home equity revolving credit balances dropped 17% from March 2009 to 2012, as home loan originations struggle while foreclosures force write-offs. New home equity lines of credit opened in January were 16% more than the recession low of $4.3 billion in January 2009, but 67% lower than the $15.2 billion in January 2008.

Home equity installation loan balances dropped 46% to $150 billion in March, from $275 billion in March 2008.  Delinquent balances in foreclosures totaled nearly $862 million in March 2011, and decreased in March 2012 nearly 30% to $604 million--the lowest since mid-2007.  Total delinquency rates for March are 14% lower than in March 2011.

"The residual effect from the recession and housing bust continues to be an obstacle for both lenders and borrowers in the housing market," said Crews Cutts. "We're seeing effects of the economic recovery within existing accounts in the form of fewer delinquencies and foreclosures, but not a substantial amount of new activity as home sales and the resulting new home financing fail to keep pace with payoffs and foreclosures."

Banks are using a cookie-cutter approach to MBL

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MADISON, Wis. (5/3/12)--While banks are submitting opinion pieces to media outlets to oppose credit union member business lending legislation, it appears that they don't have anything original to say--submitting cookie cutter co-ed pieces to newspapers across the country. Several bank associations submitted identical opinion-editorials to newspapers in their states.

Instead of putting their opposition on into their own sincere, heartfelt words--or even taking a list of talking points and disguising it a little with their own language and providing a paragraph or two of information local to their state, or localizing the information to their state-- the banks took the one-size-fits-all approach--the kind of approach that many banks' customers accuse them of taking with their services and products.

For example: Look at the independent thinking in the beginnings of these editorials by different bank associations:

  • "Sometimes in Washington, the facts get in the way.  Credit unions are once again pleading with Congress to increase their business lending authority. Sound good? " From the Pennsylvania Bankers Association op-ed in the April 24 issue of the Patriot-News.
  • "Sometimes in Washington, the facts get in the way.  Credit unions are once again pleading with Congress to increase their business lending authority. Sound good? Not so fast. " From the Texas Bankers Association op-ed in Liberty County Vindicator (April 29).
  • "Sometimes in Washington, the facts get in the way. Credit unions are once again pleading with Congress to increase their business lending authority. Sound good?"  The same letter from the same Texas Bankers Association, this time in the Times Record News (May 1).
  • "Sometimes in Washington, the facts get in the way. Credit unions are again pleading with Congress to increase their business lending authority. Sound good? Not so fast." From the Missouri Bankers Association op-ed in the News-Leader (April 21).
The entire letters are similar and nearly word for word (use the links to compare the articles). Occasionally a word is edited out, probably by a publication's editor. The only exception: one of the Texas letters adds a paragraph about a local credit union as a "prime example" of the banks' point.

Someone wrote that original op-ed piece the associations are copying, but the readers of those editorials won't know who the author is or the agenda the true author has.  Perhaps banks think consumers and Congress won't notice. In the days of instant everything, taking short-cuts is exposed faster, and the Internet is almost gleeful at catching sloppy habits and pointing out follies. 

There is a lesson to be learned, at the expense of the banks. Credit unions, too, must continue to argue their case for lifting the member business lending cap in their own words.

The Credit Union National Association has said that lifting the cap to 27.5% of assets from the current 12.25% will help generate 140,000 new jobs and provide $13 billion in new small business loans.

IChristian Science MonitorI blog CUs help with debt

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MADISON, Wis. (5/3/12)--Credit unions can be an essential tool for consumers who are looking to get out from under a pile of debt, said a guest blogger in an article posted on the The Christian Science Monitor website.

Trent Hamm, author of "365 Ways to Live Cheap," in the article "Buried in debt? How a credit union can help," mentioned how several years ago he was in debt, looking to find a path to a better personal financial situation. He took the advice of a friend and went to a local credit union.

"Most credit unions are also founded with the mission of participating in the community and helping out people in the community in various ways," Hamm wrote. "Often, this can mean extending credit to people in marginal situations through loans of various kinds, as well as financial education and assistance to its members."

He told readers that whether they have valuable assets or not, a credit union is a great option for people attempting to manage a large burden of debt.

Hamm also provides several tips on how to prepare for a meeting with a financial adviser at a credit union.

"A credit union is a very useful tool for someone who is trying to get their debt load under control. Don't neglect to use it," Hamm concludes.

To read the article, use the link.

CO-OPs THINK 12 conference raises 90k for kids hospitals

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RANCHO CUCAMONGA, Calif. (5/3/12)--Nearly $90,000 was raised in donations to Children's Miracle Network Hospitals, including $75,000 from Transaction Network Services Inc. (TNS) at the THINK 12 Conference held April 29 through May 2 in Boca Raton, Fla.

"The amount donated to Children's Miracle Network Hospitals during THINK 12 is a testimony to the people-helping-people ethic of the credit union movement," said Stan Hollen, president/CEO of CO-OP Financial Services, which presented the THINK conference. "It's not just a slogan, people in this industry really are committed to the well-being of others."

"TNS is focused on supporting organizations that help provide a brighter future for children," said Mike Keegan, president/chief operating officer of TNS, Reston, Va. "We initially became involved with the Children's Miracle Network Hospitals after seeing the passion of CO-OP and its credit union members for this important cause. We look forward to continuing our support of Children's Miracle Network Hospitals."

The 2012 meeting included three scheduled charitable events Monday, which are a tradition of the THINK conferences. Activities included a golf tournament, a 5K run/walk and an "Interactive Cooking Challenge."

In the latter event, attendees donated $150 each to learn the art of using herbs and spices from one of the executive chefs of the Boca Raton Resort and Club, site of the conference. The amount contributed by participants to these three events totaled $4,716.

At the conference's gala and dinner on Tuesday, host CO-OP Financial Services of Rancho Cucamonga, Calif., donated a further $10,000. This is in addition to the $1 million that CO-OP Financial Services donates on behalf of its member institutions to Credit Unions for Kids fundraisers annually. TNS' Keegan presented the check from TNS for $75,000 to the hospitals.

The Tuesday donations by the two companies combined with the Monday events bring the total amount raised to $89,716 at the THINK 12 conference.

For more information, use the link.

Kase voted iCU Magazinesi CU Hero of the Year

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MADISON, Wis. (5/3/12)--Ron Kase, president/CEO of Landmark CU, New Berlin, Wis., has been voted Credit Union Magazine's 2012 CU Hero of the Year.

In a time when many consumers are rethinking their relationships with for-profit financial institutions and increasingly joining and doing business with credit unions, Landmark offers several programs for specific member needs, said the magazine.

Those programs include:

  • First-Time Homebuyer Program, which waives all closing costs for qualifying first-time buyers;
  • Rescue Refinance Program, which helped members at the beginning of the recent recession break free of subprime mortgages;
  • Investment services, to encourage members of all means to save regularly;
  • Home-buying and credit counseling seminars, offered in English, Spanish, and Hmong; and
  • Hispanic initiative, which includes hiring bilingual staff, serving as an authorized Internal Revenue Service representative in issuing individual taxpayer identification numbers, issuing Matricula Consular cards, and offering inexpensive ($5) wire transfer services.
Landmark's mortgage servicing portfolio currently tops $1.6 billion. And for nine consecutive

quarters, Landmark has been the No. 1 auto lender in southeastern Wisconsin.

When asked about his proudest accomplishments, Kase told Credit Union Magazine, "I'm most proud of the fact that we've been able to help many people help themselves at the start of their economic lives."

Kase also said he is proud that during his tenure, Landmark has created about 450 jobs for people in southeastern Wisconsin.

Credit Union Magazine readers also commended three other credit union leaders this year as CU Heroes:

  • Rudy Hanley, president/CEO, SchoolsFirst FCU, Santa Ana, Calif. His political involvement, work ethic, and integrity have benefited his own credit union and the credit union movement overall.
  • Frank Matous Sr. (posthumous), former CEO of Tandem FCU, Warren, Mich. A credit union pioneer, he encouraged his four sons to stay active in the credit union movement.
  • Joe Robertson, retired president/CEO, Our Community FCU, Shelton, Wash. His credit union garnered a record $18 million increase in total deposits for 2009 (doubling the previous year's increase), during the slow recovery from the recession.
The award will be presented during the Credit Union National Association's (CUNA) America's Credit Union Conference in San Diego June 17-20. Credit Union Magazine is published monthly by CUNA.

Delaware league elects officers presents awards

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NEW CASTLE, Del. (5/3/11)--The Delaware Credit Union League elected two board members and presented its outstanding volunteer and professional awards its 53rd annual meeting held Saturday in New Castle.

The Delaware Credit Union League presented its outstanding volunteer and professional awards at its 53rd annual meeting Saturday in New Castle. The 2011 Outstanding Credit Union Volunteer was awarded to Karen Whitaker, left, board member at Del-One FCU, Dover. James Everhart, right, CEO of Louviers FCU, Newark, was named the Outstanding Credit Union Professional. (Photo provided by the Delaware Credit Union League)
Incumbents Sharon Schaeffer, Delaware First FCU, Wilmington, and Susan Winward of Wilmington Postal FCU, Newport, were re-elected to serve three-year terms.

The league also announced its 2012 board officers at a reorganizational board meeting. Officers include:

  • Chair--Jerry King, DEXSTA FCU, Wilmington;
  • Vice chair--Sharon Schaeffer, Delaware First FCU;
  • Secretary--Meredith Jeffries, New Castle (Del.) County Delaware FCU; and
  • Treasurer--Cheryl Chilcutt, Louviers FCU, Newark.
The board also includes:

  • Allen Riley, Sussex County FCU, Seaford;
  • Joel Romaine, Community Powered FCU, Newark; and
  • Susan Winward, Wilmington Postal FCU.
James Everhart, CEO of Louviers FCU, was honored as the 2011 Outstanding Credit Union Professional.

The 2011 Outstanding Credit Union Volunteer award was presented to Karen Whitaker, Brown, board member at Del-One FCU, Dover.

CUs in several states reporting scams

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MADISON, Wis. (5/3/12)--Credit unions in Ohio, Michigan and Georgia are reporting fraud attempts related to unauthorized transactions.

At least three Ohio credit unions reported instances of debit card fraud. The credit unions have put in place additional security monitor transactions, the Springfield News-Sun (May 1) reported.

Wright-Patt CU, with $2.4 billion in assets, Fairborn, has identified an increase of fraud in unauthorized debit card transactions taking place outside of Ohio, said Tracy Fors, a spokeswoman for Wright-Patt CU.

The credit union has advised members to use their personal identification number on all debit card purchases made outside the state.

River Valley CU, a $216 million asset credit union in Miamisburg, reported about 200 compromised cards during the weekend, said John Bowen, president/CEO of the credit union, in the Dayton Daily News (May 2).

Fraud has increased at the credit union roughly 150% since the first quarter, Bowen said.

River Valley is limiting non-PIN transactions that take place out of state.

The $100 million asset CODE CU, Dayton, has issued a fraud alert on its website. The credit union reports that fraudulent transactions have taken place at several Walmart locations. It has restricted non-PIN transactions in some areas.

University Health CU, with $19 million in assets, Augusta, Ga., warned area residents of scammers calling texting and e-mailing people to trick them out of their money (Augusta Chronicle April 30).

The scammers leave messages claiming a card has been lost or stolen and the member needs to verify credit information.

University Health CU has posted a message on its website that the credit union will not text or call members to verify account information. The message also urges members not to respond to any calls or messages they receive concerning their debit cards.

CASE CU, with $217 million in assets, Lansing Mich., reported  a series of text message scams that began April 13. It  issued a press release reminding members and non-members that no legitimate financial institution will send an e-mail or text asking for passwords, PIN numbers, card numbers, or other confidential information in an unsecure manner.  The credit union assured members it would never call, e-mail or send a text message asking for banking credentials.

CASE CU offered its members these tips to ensure their safety on the Internet:

  • Set strong passwords;
  • Don't reveal personal information via e-mail;
  • Exercise website caution;
  • Recognize file downloads can be dangerous;
  • Always logoff;
  • Monitor account activity;
  • Assess these risks:

    a. Who has access to online accounts?

    b. How and where are user names and passwords stored?

    c. How strong are passwords and how often are they changed?

    d. Do you have a strong antivirus protection program that is up to date?

CU System briefs (05/02/2012)

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  • RANCHO CUCAMONGA, Calif. (5/3/12)--
    Click to view larger image Click for larger view
    PaulYang, right, of Premier Community CU, Stockton, Calif., receives a trophy and the $10, 2012 CO-OP THINK Prize from Curtis Fish, vice president, MasterCard, which sponsored the award presented during the CO-OP Financial Services THINK 12 Conference Tuesday in Boca Raton, Fla. Yang won for his idea for a "P2P (person-to-person)  Payment Card for CO-OP Network Cardholders."  "Anyone with a CO-OP Network card can send money to anyone else having a CO-OP Network card," Yang explained, adding it means "members can easily pay one or another member, at any CO-OP ATM," he said. Yang and two other finalists presented their business plans to conference attendees Monday.  Other finalists were Maricela Jauregui, branch manager, Mid Cities CU, Compton, Calif., who presented "QR Code Verification," and Jay Schwartz, vice president, sales and service delivery, Marriott Employees' FCU, Bethesda, Md., who presented "Social Networking for Credit Union Members."  CO-OP Financial Services President/CEO Stan Hollen said the goal of the prize "is to promote and inspire creative thinking on industry issues, and Paul's plan is a wonderful display of that." Judging criteria included four standards: impact, creativity, aggregation ( application of the idea across the country) and implementation (can be adopted quickly) .  Entries for the CO-OP THINK 13 Prize for 2013 will open June 1 at www.co-opthink.org. (Photo provided by CO-OP Financial Services) …
  • PITTSBURGH (5/3/12)--Sandy Lazzara, retired CEO of Greater Pittsburgh Police FCU, was honored Friday by the Fraternal Order of Police Fort Pitt Lodge No. 1 with its service recognition award, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway May 2). Lazzara is the first civilian to receive the award, which was "in appreciation of her professional service in addressing the financial needs of the [members of] FOP Lodge No. 1 and their families over the past 11 years" and for her work on the Fallen Heroes Fund.  Lazzara retired Jan. 31 after 35 years in the movement. She received PCUA's  Lifetime Achievement Award  as the Professional of the Year in 2004. The credit union received the state (2010) and national (2011) Dora Maxwell Award for collecting nearly $2 million in donations from across the country for the Fallen Heroes Fund, which was designated for the families of three slain police officers, said PCUA …
  • ALBANY, N.Y. (5/3/12)--Edwin G. Pustelnik, former president/CEO of Buffalo (N.Y.) Fire Department FCU and statewide movement leader, died April 20, according to the Credit Union Association of New York (CUANY). Pustelnik began serving on the board of the credit union about 40 years ago. He then joined the credit union staff, working his way up from a clerk to a loan officer, and eventually to president/CEO.  When he retired, he returned to the credit union board and became its chairman.  He also served on the CUANY's Buffalo Chapter council from 1982 to 1988. He was elected to the association's board in 1988 and served until 1993. In 1989, he joined the board of CUC Mortgage Corp., where he served for a number of years.  "We are saddened by the loss of a true credit union advocate and supporter," said William J. Mellin, CUANY president/CEO. "Throughout his career, Ed brought great energy and vision to preserving the well-being of Buffalo Fire FCU and all credit unions." He is survived by two daughters, one son and six grandchildren …

Miriam De Dios succeeds Morrow as Coopera CEO

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DES MOINES, Iowa (5/3/12)--Miriam De Dios has been named CEO of Coopera, according to Affiliates Management Co. (AMC), the  Des Moines, Iowa-based Hispanic consulting firm's parent company.

De Dios has been with Coopera since its inception and most recently served as vice president. She will fill the position held by founder Warren Morrow, who died unexpectedly in February.

Since helping launch Coopera, De Dios has overseen the company's client operations, managed the innovation of Coopera products and led the company's marketing and public relations efforts. She is a nationally known speaker on the importance of outreach to underserved Hispanics.

According to Patrick Jury, president/CEO of AMC and the Iowa Credit Union League, De Dios' background, skills and talents "make her the perfect fit" as Coopera's CEO." Credit unions have an outstanding opportunity to serve the Hispanic community, which is today the fastest-growing, youngest and most underserved group in our country," he said. "With leadership from Coopera, I am confident our movement will increase its commitment to reaching this deserving community."

A native of Jalisco, Mexico, De Dios worked with State Farm Insurance Cos. and John Deere Credit prior to Coopera. Witnessing her parents' struggles to navigate the U.S. financial system, she is passionate about furthering Coopera's mission of connecting more Hispanics--both immigrant and U.S. born--with the financial mainstream. Credit unions, she says, are the answer.

"We have an immense opportunity to continue providing dignified financial services to the Hispanic community through credit unions," De Dios said. "Although the need for Hispanic growth in the credit union industry is greater than ever, I see it being met with increased motivation and momentum by credit unions, which is energizing."

Coopera works in partnership with the Credit Union National Association (CUNA) and credit unions to help credit unions nationwide grow by serving the Hispanic community. They designed "El Poder es Tuyo" (The Power is Yours), a customizable, Spanish-language personal finance website for Hispanic credit union members and potential members. (For more information, use the resource link.)

"At CUNA, we have the utmost respect and confidence in Miriam and applaud her promotion," said Mark Condon, senior vice president of business and consumer publishing at CUNA. "We look forward to continuing our strategic alliance with Coopera to help credit unions grow through the underserved Hispanic community."

De Dios is a member of the national Network of Latino Credit Unions and Professionals, and the World Council of Credit Unions' Global Women's Leadership Network.  She is active in a number of organizations in the Latino community in Des Moines.

Coopera's Interim CEO, Murray Williams, will return to his roles as AMC chief administrative officer and Iowa league chief operating officer.

Rivermark Community CU to close Salem branch

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BEAVERTON, Ore. (5/2/12)--New technology and location were the primary reasons cited for a branch closure announced by Beaverton, Ore.-based Rivermark Community CU.

The credit union, which has more than $550 million assets, said it will close its Salem branch this summer because of fewer branch transactions, its location, and a growing trend by members to use online banking and ATMs.

The last day of operation for the branch will be Friday, June 29. The branch had been acquired through a merger with Oregon Territory FCU in August 2009.

Scott Burgess, Rivermark Community president/CEO, said that the branch was impacted in part because of new technology and by location. "We had optimistic expectations for the future of the branch," he said in a press release posted on the credit union's website.  "By closing this branch, however,  Rivermark will be able to make further investments in online services and technology which is becoming more in demand."

Burgess noted that "our members like the convenience of online and mobile banking. Having access to services online 24 hours a day, seven days a week has become an easy, safe and secure option."  Many members use secure online and mobile banking services to make deposits, open new accounts, apply for loans and transfer funds from their computer or mobiledevices. "It's no longer necessary for members to come to us when we are always available online to them, when they need us," Burgess said.

Rivermark said it is the first credit union in Oregon to offer Mobile Deposit where members can deposit paper checks using their iPhone or Android device.  In two months, more than 5,000 members had downloaded the free DeposZip Mobile app.

Members wanting to visit a branch can visit a credit union shared branch and have access to 28,000 free ATMs nationwide. More than 50 ATMs are located in Salem and most accept deposits, said the credit union.

Connecticut CUs kick off cooperative ad campaign

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MERIDEN, Conn. (5/2/12)--The Credit Union League of Connecticut (CULCT) Monday kicked off its 2012 CULCT Cooperative Advertising Campaign, educating the public about the credit union difference and directing them to the ASmarterChoice.org website.

The campaign  is funded by voluntary contributions from member credit unions, which will be listed in the newspaper and broadcast ads.

"It is important that people in Connecticut are aware that credit unions are here, available to them, and offer convenient and affordable financial services in a friendly and informative manner," said Tony Emerson, league president/CEO.

The television ads will end in December. They will be aired on WTIC and WCCT on these dates:

  • April 30-May 13;
  • May 20;
  • May 28-June10;
  • Aug. 27 to Sept. 9;
  • Oct. 1-24;
  • Nov. 12-26; and
  • Dec. 3-17.
The newsprint campaign will be printed on May 10, June 14, Sept. 13, Oct. 11, Nov. 8 and Dec. 13 and will appear in The Hartford Courant, The New Haven Advocate and the Fairfield County Advocate.

Credit unions contributing to the campaign include:

  • Achieve Financial CU, Berlin;
  • American Eagle FCU, East Hartford;
  • Charter Oak FCU, Groton;
  • Connex CU, North Haven;
  • Greater Hartford Police FCU, Hartford;
  • Hartford (Conn.) FCU;
  • Hartford (Conn.) Municipal Employees FCU;
  • Members CU, Cos Cob;
  • Northeast Family FCU, Manchester;
  • Northeastern CT Healthcare CU, Putnam;
  • Nutmeg State FCU, Rocky Hill;
  • Personal Care America FCU, Trumbull;
  • Seasons FCU, Middletown;
  • SoundView CU, Bethel;
  • Stamford (Conn.) Healthcare CU;
  • Torrington (Conn.) Municipal and Teachers FCU;
  • Wepawaug-Flagg FCU, Hamden.
Use the resource link to view the television commercial.

CUs deserve upgraded lending limit say new op-eds

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MADISON, Wis. (5/2/12)--Credit unions deserve an upgraded member business lending (MBL) limit, say opinion-editorials in Connecticut and Pennsylvania media. That message also will be a focal point at a credit union booth at a "Putting America Back to Work" event this month in New York City.

On May 15, the New Jersey Credit Union League will man a booth at a "Putting America Back to Work" event hosted at The Javits Center in New York City by 77 WABC, 95.5 WPLJ and news correspondent Geraldo Rivera. The event aims to take action to help communities get back to work. Rivera will broadcast his "Geraldo" show on 77 WABC from the event from 10 a.m. to noon, and he will host an on-air panel discussion about how businesses can help put America back to work.

New Jersey league representatives will be at the booth "to spread the word about the taxpayer-free, common-sense approach to job creation that MBL legislation entails," said the league (The Daily Exchange April 30).

They and several op-eds from businesspersons and others have urged Congress to lift the MBL cap to 27.5% of assets from the current cap of 12.25%. The Credit Union National Association has said that lifting the cap will enable credit unions to inject $13 billion in new small-business loans into the economy and help create 140,000 jobs the first year, at no expense to the taxpayer.

In  HartfordBusiness.com (April 2) Norman Halls, chairman of the board at STCU CU, Springfield, Mass., and a businessman with Madsen Group LLC, which provides workplace solutions, urged support of the Small Business Lending Enhancement Act of 2011, which will increase the MBL cap.

He outlined why credit unions deserve to make more business loans.  "Back when credit unions started, over 100 years ago, banks wouldn't assist the workers. Nowadays, 'it's deja vu all over again,' with banks today unwilling to assist the average consumer," he wrote. Halls noted that credit unions offer better deals in all services and products, have helped members having a hard time making ends meet, are member owned and have volunteer board members.

Bankers are opposed to the MBL cap, he wrote. "Here again the banks do not want to assist the small business like they wouldn't assist people who wanted a small loan for a household item. Bankers do not like competition," he said, referring to the exodus of bank accounts to credit unions surrounding Bank Transfer Day last November. "Banks didn't like the movement and are trying to get back at credit unions for assisting small depositors and small businesses," Halls wrote.  "Throughout this whole financial crisis, the credit unions have held strong. Why? Because we assist our member," he said.

Meanwhile, banks have showed little ingenuity in their efforts at discrediting the MBL bill in the media. The same opinion-editorial--word for word--was sent to the Patriot-News (April 24) by the Pennsylvania Bankers Association; to the News-Leader (April 21) by the Missouri Bankers Association; and to the Liberty County Vindicator (April 29) and the Times Record News (May 1) by the Texas Bankers Association.

Pennsylvania Credit Union Association President/CEO Jim McCormack responded to them in a letter to the editor published Friday on PennLive.com.  "The cap on small-business lending is constraining credit unions nationwide and here in Pennsylvania. Nationally, an increase in the cap will likely result in $13 billion additional small-business loans, creating 143,000 jobs throughout the U.S. in year one," he wrote. "In Pennsylvania, we'd see $275 million in new loans, creating almost 3,000 jobs."

McCormack clarified the type of small-business loans the bill would address. "In Pennsylvania, the average credit union small-business loan is $153,000. We aren't financing strip malls or hotels; we are helping the local small-business owner buy a piece of equipment to expand his or her business--often, only after they have been refused by a bank."

"Credit unions have never taken one dime of bailout money, and we don't intend to. We would, however, welcome the opportunity to provide more small-business loans to our members who can't find credit elsewhere," McCormack said.

N.Y. taxi CUs sue state over new licensing law

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NEW YORK (5/2/12)--The Taxicab Service Association (TSA)--an association of credit union lenders that finance New York City yellow taxi medallion purchases--and four individual credit unions filed a lawsuit Friday in New York State Supreme Court, asking the court to invalidate the HAIL Act, which when passed in 2011 allowed up to 18,000 new taxi licenses in the city. 

The credit unions include Lomto FCU, Melrose CU, Montauk CU and Progressive CU--all from the New York area. 

Defendants in the suit include the state, the city, the state senate and assembly, New York Gov. Andrew Cuomo, New York City Mayor Michal Bloomberg, the New York City Taxi and Limousine Commission, and the commission's Chairman and Commissioner David Yassky.

The credit unions argue that the HAIL Act is invalid because it represents an illegitimate state takeover of many aspects of New York City's local property, affairs and government which violates the New York State Constitution's Municipal Home Rule Law, according to the court documents filed.

The complaint further alleges that the state interfered with the New York City Council's long-standing regulation of the local taxi system.

Bloomberg implemented a plan last year to fill a hole in the city's budget, the plaintiffs allege in the court documents. They also allege that the issuance of HAIL licenses would flood the once-exclusive market, siphoning both customers and drivers away from yellow cabs.

The HAIL Act is illegal and unconstitutional because it "imposes dramatic private costs" on the existing taxi drivers and lenders "to address a public problem, but provides no just compensation for medallion owners or lenders," said the complaint.

The lawsuit asks for a declaration from the court that the HAIL Act is illegal and an order preventing the defendants from implementing the act.

Taxi medallions are symbols that are usually attached to the hood of New York City cabs. The medallions are licenses that are regulated by the city and allow drivers to pick up curb-side passengers who "hail" a cab. Credit union service organizations may originate business loans that are used to purchase taxi medallions, the National Credit Union Administration said in a legal opinion released in October 2010 (News Now Nov. 1, 2010).

In New York, the state Supreme Court is a lower-level trial court.

Two surveys indicate Americans need financial overhaul

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MADISON, Wis. (5/2/12)--Two recent surveys indicate Americans need a finance habit overhaul and represent an opportunity for credit unions to provide financial education to members.

Credit unions can sit down with members and educate them on savings, investing, spending and their financial goals by providing counseling, educational services and brochures.

A majority of consumers surveyed are not financially prepared for a medical emergency, with 28% saying they have less than $500 saved for medical expenses, and 51% indicating they have less than $1,000, according to an April 2012 Aflac Workforce Report.

There are roughly 38.9 million medically consulted injuries per year, according to the National Safety Council.

When asked how they would pay for out-of-pocket expenses due to an unexpected illness, more than half (57%) of respondents said they would have to tap into savings, 30% would use a credit card and 19%--nearly one out of five people--would have to withdraw funds from their 401(k) plans to cover the costs.

Of those surveyed, 58% admitted they have no financial plan to handle a large, unexpected cost, while 8% said they're financially prepared.

Also, 51% said one of the major reasons for not setting money aside for emergencies is that they were trying to pay down debt, the survey said.

In a related matter, when asked to describe the state of their personal financial situation, 80% of more than 1,400 respondents admitted their finances were in need of a major overhaul, according to an April poll hosted on the National Foundation for Credit Counseling (NFCC) website. 

"This statistic parallels the findings of the recent NFCC Financial Literacy Survey in which 80% of adults indicated they could benefit from additional advice and answers to everyday financial questions from a professional," said Gail Cunningham, NFCC spokesperson. "It is encouraging that people recognize how perilous their financial situation has become. Now they need to take action to resolve the problem and keep it from spiraling out of control."

To help consumers determine if their finances could use an overhaul, the NFCC developed a 10-question true/false quiz.

A summary category question on the state of respondents' overall finances and the results:

  • Are [going] along just fine--4%;
  • Could use a tune-up-- 13%;
  • Are in need of a major overhaul--80%; and
  • Have never been better-- 3%.

WOCCU urges key changes to proposed FATCA rules

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WASHINGTON, D.C.  (5/2/12)--The World Council of Credit Unions (WOCCU) this week said it is opposed to some aspects of the U.S. Internal Revenue Service's (IRS) proposed implementation of the Foreign Account Tax Compliance Act (FATCA).

The proposed regulations would require many foreign financial institutions (FFIs), including credit unions, to register with the IRS to detect taxable account activity by U.S. citizens in foreign countries. They would place unnecessary and inappropriate burdens on small non-U.S. credit unions, WOCCU said in an April 30 letter to the IRS.

"Credit unions are in most cases small, localized financial institutions that, like banks, provide members with retail banking services," wrote Michael Edwards, WOCCU chief counsel and vice president for advocacy and public affairs. "Unlike banks, only people within the credit union's common bond can become members. Credit unions are unlikely to have accounts held by 'U.S. persons' who are not residents of the credit union's home country."

WOCCU further urged the IRS to revise current definitions within FATCA rulings so that small local credit unions are exempt from compliance with the rule. Some credit unions' current inability to qualify as "nonregistering local banks" as defined by the proposed legislation puts an undue and inappropriate burden on the institutions, a concern of credit union leaders around the globe. Appropriately revising the proposed rule would help small credit unions avoid noncompliant activities, the letter said.

WOCCU also urged the IRS to make other changes to the rule, including actions that would:

  • Raise the maximum asset threshold for credit unions meeting the "nonregistering local bank" definition to $1 billion from the current $175 million;
  • Revise the definition of "U.S. account" to exempt accounts less than $50,000, even when a "U.S. person" holds such an account;
  • Allow non-U.S. credit unions meeting the "nonregistering local bank" and "local FFI" definitions to offer U.S. dollar-denominated financial products to members on their websites;
  • Amend the proposed definition of "local FFIs" in several other respects to reduce regulatory burdens on non-U.S. credit unions and prevent unintended consequences;
  • Modify the proposed rule to permit institutions to receive refunds withheld erroneously under FATCA, even when the institution is a "nonparticipating FFI;"
  • Exempt international workers' remittances from FATCA coverage to promote financial inclusion for underserved immigrant populations and their families in developing countries; and
  • Support the Credit Union National Association's comment letter on the proposed FATCA rules with respect to FATCA's impact on U.S. credit unions. (To read an April 30 News Now article about CUNA's position on FATCA, use the link.)
"We appreciate the opportunity to comment on the proposed FATCA regulations," said Brian Branch, WOCCU president/CEO. "We urge the IRS to review our recommendations and act in a way that removes undue compliance burdens on small, locally owned credit unions, freeing them to use their resources to serve their members."

The public comment period on the proposed FATCA regulations closed April 30. WOCCU has petitioned the IRS to be allowed to participate in a public hearing in Washington, D.C., on May 15 to further support its recommendations. The final law, due to take effect Jan. 1, will be released before year-end.

Filene accepting applications for innovators group

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MADISON, Wis. (5/2/12)--The Filene Research Institute is accepting applications for 17 spots in its innovation program, called i3.

The group for innovators has a lower acceptance rate than Cornell University and 13% of its participants become credit union CEOs, said Filene, noting "the future of credit unions depends on its success."

The recruits will help create new products, services, business models and processes that aim to help transform consumers' financial lives.

To be considered, candidates must be executives at credit unions or credit union service organizations (CUSOs) who are not quite at the CEO level but who are considered a leader or future leader in the credit union system.

Seventeen candidates will be selected for two-year terms. The program requires they have commitment and support from their credit union's CEO or manager to participate in the program. Other requirements include a commitment to:

  • Pilot at least two i3 ideas;
  • Attend two national meetings per year in their entirety (two to three days each);
  • Cover all travel costs associated with involvement; and
  • Attend regular group work and project meetings beyond national meetings.
The next meeting is in Ann Arbor, Mich., Oct. 9-11.

Applicants must complete the application form, take an online 100-question behavioral/entrepreneurial assessment, and take a short "grit" test (to determine perseverance and passion for the work).  

Application deadline is at 12 a.m. CT May 31. Candidates will be selected and notified by mid-August. For more information, use the link.

Lawsuits breaches top iNews Nowsi Top 10 April stories

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MADISON, Wis. (5/2/12)--ATM fee notification lawsuits and new data breaches dominated the top 10 News Now stories for April. Here are the top 10 stories for the month:

10. MBLs and more on tap as Congress returns

WASHINGTON (4/16/12)--Although increasing member business lending (MBL) authority for credit unions remains the top priority for the Credit Union National Association (CUNA) and credit unions as members of the U.S. Congress return to Washington this week, CUNA Senior Vice President of Legislative Affairs Ryan Donovan said there are a number of other issues of interest to credit unions brewing.

9. Former WesCorp officials ask court for jury trial

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).

8. CUNA releases 12-question CU overdraft survey

WASHINGTON (4/23/12)--The Credit Union National Association (CUNA) is asking credit unions to share information regarding their overdraft protection programs, and overdraft transfer and marketing practices, through a short, 12-question CUNA survey.

7. What to do to mitigate breach risks--CUNA Mutual

MADISON, Wis. (4/2/12)--The large-scale data breach revealed Friday at Atlanta-based card processor Global Payments Inc. has prompted CUNA Mutual Group to send its credit union bond policyholders a Risk Alert with advice on what they should do.

6. Visa drops Global Payments from 'compliant' list

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.

5. Two CUs settle ATM lawsuits in Michigan federal courts

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.

4. CU savings up, loans down, assets close to $1 trillion

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.

3. CUNA takes on banks for MBL claims

WASHINGTON (4/12/12)--The Credit Union National Association is warning lawmakers to not be fooled by the misinformation being circulated by bankers in an attempt to derail potential Senate action that could increase the credit union member business lending cap."

2. CUNA seeks CU info in massive breach

WASHINGTON (4/2/12)--The Credit Union National Association (CUNA) is seeking specific credit union information from Visa and MasterCard in the wake of the disclosure Friday that the companies are notifying card-issuing credit unions and banks of a massive data breach at a third-party payments processor, Atlanta-based Global Payments Inc.

1. Judge throws out ATM notice lawsuit vs. PSECU

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 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.

CU System briefs (05/01/2012)

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  • ONTARIO, Calif. (5/2/12)--The California and Nevada Credit Union Leagues have named Dwight Johnston as chief economist. Johnston has been president of Dwight Johnston Economics since it was formed in 2010. He began his new role on Tuesday.  He will operate from the leagues' Ontario, Calif., office.  In his new role, Johnston will provide member credit unions with daily commentaries, breaking economic news, regular economic updates, monitoring and interpretation of Federal Reserve pronouncements, webinars, educational tools for consumer members, and board strategy planning services. He has more than 30 years of investment experience with financial institutions. For the past 14 years, including 12 as chief economist for Western Corporate FCU, Johnston has focused on economic and market information and education for credit unions …
  • ST. PAUL, Minn. (5/2/12)--For the first time in the Twin Cities, a credit union will operate out of a high school.  St. Paul FCU will open a student-run branch this fall at Como Park Senior High School, reported KSTP.com  (April 30). The new branch will be the second student branch in Minnesota, said the Minnesota Credit Union Network. Use the link for the full article and a video …