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Alamo FCU To Offer Concierge Services

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SAN ANTONIO, Texas (5/30/13)--Alamo FCU has announced a plan to offer concierge service to its members. A credit union representative will arrive at members' home or office to provide personalized services.

"It's a differentiator for us," Max Villaronga, Alamo FCU president/CEO told News Now. "We are in a market with great credit unions and great banks. We wanted to develop a solution for people that don't think banks are that convenient, whether it's 10 branches, or 30 or 40 branches."

The $43 million asset San Antonio, Texas-based credit union will send a branded SUV with a representative to take loan applications, open accounts or assist with other products that Alamo FCU offers (The Financial Brand May 21). The vehicle will not carry cash, the credit union said.

The service is available to all prospective and current members, the credit union said.

The concierge service also saves Alamo the "headache" of further branch investment and maintenance, Villaronga said. "Rather than spending our members' money on facilities, we can provide a significantly upgraded level of service," he added.

The service is offer seven days a week from 7 a.m. to 7 p.m.

After a soft roll out 90 days ago, and a formal announcement earlier this month, the service has received an "excellent reception," Villaronga said.

"If they are not at appointments, they are busy prospecting for appointments," he added.

CFO Council Announces 2013 Exec Committee

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MADISON, Wis. (5/30/13)--The CUNA CFO Council announced its executive committee during the council's 19th annual conference, May 19-22 in Chandler, Ariz.

David D'Annunzio, senior vice president and chief financial officer (CFO) for Heritage Trust FCU, Charleston, S.C., was elected to his second term and will remain council chair. Suzanne Weinstein, CFO for Orlando (Fla.) FCU, Orlando, Fla., was elected vice chair. Bryanna Tapley, CFO for CP FCU in Jackson, Mich., will become second vice chair.

Steven Arbaugh, CFO for SECU, Linthicum, Md., and Bradley Schone, senior vice president of finance and lending for Park Community FCU, Louisville, Ky. were elected to their first terms on the executive committee.

Arbaugh and Schone replace outgoing committee members Pam Finch, vice president of administration and chief financial officer, Mid Minnesota FCU, Baxter, Minn. and Mary Torsney, senior vice president and chief financial officer, Financial Partners CU, Downey, Calif. 

Other executive committee members include:

  • Joan Hill, vice president accounting, VyStar CU, Jacksonville, Fla.;
  • Sonya Jaynes, CFO/strategic planning coordinator, Red River Employees FCU, Texarkana, Texas;
  • William Kennedy, CFO, Interior FCU, Washington, D.C.;
  • John Meeker, senior vice president and CFO, Caltech Employees FCU, La Canada Flintridge, Calif.;
  • G. Scott Morgan, senior vice president, finance and administration, League of Southeastern Credit Unions, Tallahassee, Fla.; and
  • Jason Peach, senior vice president and CFO, West Community CU, O'Fallon, Mo.

CU System Briefs (05/30/2013)

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  • REDDING, Calif. (5/30/13)--Father's Day is June 16 and one California credit union is conducting a video contest to celebrate the most deserving dad in Shasta and Tehama Counties. Members 1st CU in Redding, Calif., will offer two tickets to a San Francisco Giants game to the winning Dad. "We want to know what makes your dad special and the most deserving," said the $101 million asset credit union. "Does your dad go above and beyond in his daily actions? Has he overcome obstacles and given back to those in need? How has he fulfilled the role of being a good father?"  Fathers can be nominated by a child, spouse, family members or friend by creating a 30-second video explaining what sets Dad above the rest. Videos are due Friday; voters can vote between Saturday and June 14. The winner will be announced on Father's Day. For credit unions interested in the details, check out the credit union's Facebook page at facebook.com/members1stcu ...
  • SAN ANTONIO (5/30/13)--Security Service FCU has unveiled myBranch, a redesigned online banking platform formerly known as CompuBranch, to its nearly 190,000 online members. The new platform is on the heels of the $7 billion asset, San Antonio-based credit union 's launch of its mobile banking solution, myBranch Mobile. The overhaul includes a new design, the ability to pay loans and transfer funds from other institutions, pre-filled deposit account applications and download options for personal financial management software programs such as Quicken and Quick Books. "It's a long step from 1996, when SSFCU leapt into the online arena with one of the first interactive banking websites that featured 'handy little calculators' called wizbots, up-to-date rates and online loan applications," said Mike Chapman, SSFCU executive vice president and chief operating officers.  "myBranch is our new digital banking convergence platform that will provide members the same level of self-service no matter what device they choose to use."  SSFC plans to roll out additional myBranch functionality in the coming months ...

WOCCU Initiates CU Revitalization In Liberia

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MADISON, Wis. (5/30/13)--Thanks to a US$2.45 million, four-year grant to rapidly expand savings and improve livelihoods of poor and low-income households through credit unions in Liberia, the World Council of Credit Unions (WOCCU) is working with its new member organization, the Liberia Credit Union National Association (LCUNA), to revitalize the credit union system there.

Click to view larger image Liberia Credit Union National Association staff, shown here, and the World Council of Credit Unions will work to revitalize the credit union system in Liberia through a MicroLead program funded by the United Nations Capital Development Fund. (Photo provided by the World Council of Credit Unions)
WOCCU recently received the grant from the United Nations Capital Development Fund through its MicroLead program. It is WOCCU's first credit union development in the West African country.

"Liberia is celebrating its 10th consecutive year of peace and is transitioning from a period of stabilization to transformation," said WOCCU President/CEO Brian Branch. "Credit unions are a vital component to Liberia's economic and democratic revitalization as they have become a primary means of rural communities rebuilding their agricultural production and market trade."

The program will establish new credit union savings products, build credit union capacity and strengthen LCUNA's ability to establish and maintain a network of safe and sound credit unions in Liberia. WOCCU also will work with LCUNA to establish four regional credit unions as models for the national credit union system.

Today, LCUNA has 300 affiliated credit unions serving a combined 36,000 members. Before the first of two civil wars from 1989 to 2003, Liberia had 71 credit unions with US$10 million in savings and 20,000 members. Of the pre-war population of 2.8 million, more than 200,000 people lost their lives and 1.8 million were displaced.

Many credit unions lost member deposits and records during the conflicts. Since then, the volunteer-run institutions have received little training in modern standards or marketing strategies, said WOCCU.

Liberia's population today totals four million people. Liberia President Ellen Johnson Sirleaf has said the country can become a middle-income country by 2030. WOCCU said its program supports Liberia's hopes for financial inclusion to achieve that goal.

Equifax: Auto-loan Originations At Eight-year High

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ATLANTA (5/30/13)--Auto-loan originations and the number of new-auto loans in the U.S. each set eight-year highs during January and February, according to Equifax Inc.'s National Consumer Trends Report, released Wednesday.

The two months saw $69.6 billion originated in new credit for auto loans--more than 70% above the recession low of $40.2 billion for the same period in 2009, said the Atlanta-based credit information company.

Equifax noted that 3.5 million new-auto loans originated in January and February, with the total number of loans at 59.8 million, nearly a four-year high.  New loans funded during that time by credit unions, banks and thrifts increased by more than 20% to $35.6 billion from $29.5 billion.

"Sales of new cars and light trucks hit a five-year high in the first quarter on a seasonally adjusted basis, and consumers' demand for auto loans is similarly strong," said Equifax Chief Economist Amy Crews Cutts. 

"Light trucks in particular are in demand for the newly energized housing construction trade, and there is a lack of supply of used trucks available so prices on these vehicles are currently rising," said Crews Cutts.  "Consumers are also funding purchases of used cars with loans at attractive rates, and low delinquency rates are allowing lenders to make credit a bit more easily available."

For credit unions' loan portfolios, the auto-loan portion increased into a slightly bigger slice of the pie. New-auto loans in March accounted for 10.7% of loan portfolios, up from 10.1% in March 2012, according to the Credit Union National Association's March Monthly Credit Union Estimates. Used-auto loans in March were 19.4% of the loan portfolios, compared with 18.7% in 2012. (Note: CUNA's monthly estimates for April will be out early next week).

Other key findings:

  • Outstanding auto loan balances totaled $798 billion as of April, up more than 8% from the same time a year ago and a 51-month high;
  • The total number of loans is 59.8 million, nearly a four-year high;
  • As of April, total outstanding balances on loans funded by auto finance companies are $416.9 billion, a 50-month high, while the total number of outstanding loans is more than 31 million, a 46-month high; and
  • For outstanding balances funded by credit unions, banks and thrifts, balances totaled $381.1 billion, a more than 60-month high, while the number of loans outstanding totaled more than 28 million, a 41-month high.
Serious delinquencies on auto loans fell in April for loans funded by banks, credit unions and other depositories to 0.32% of outstanding balances, a 13.9% decline from March and a 9.1% drop from a year earlier.

For loans financed by auto finance companies, serious delinquencies dropped to 1.75% of outstanding balances--down 11.7% from March and 15.4% from April 2012.

Patent Troll's Latest Lawsuit Includes Texas CUs

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PLANO, Texas (5/30/13)--A company that has been filing remote-capture-image patent-infringement lawsuits against financial institutions and data processors for over a decade, filed another one Tuesday in a Texas federal court, naming 49 defendants, including four Texas credit unions and several credit union check processors as defendants.

Filed in the U.S. District Court for the Eastern District of Texas, the suit by DataTreasury Corp., names among the defendants  $30 million asset Cherokee County FCU in Rusk, Texas; $636 million asset DATCU CU in Denton, Texas; $1 billion asset Advancial FCU in Dallas; and $718 million asset United Heritage CU in Austin.

DataTreasury's complaint alleges infringement of its "Ballard Patent," which the company said, is "foundational to modern day, image-based check processing, enabling technological improvements that save the banking industry billions of dollars annually." It asks for a permanent injunction to prevent them from employing the technology and asks for damages based on reasonable royalty.

The Credit Union National Association is aware of DataTreasuryand its claims. The company has targeted large financial institutions with patents related to check processing and the digital capture and storage of checks, and has recently begun targeting small and mid-sized financial institutions, including credit unions and community banks.  The Eastern District of Texas, where the lawsuit is filed, is known to be particularly friendly toward patent plaintiffs.

DataTreasury is one of the earliest and perhaps most well-known "patent trolls" of the financial services industry. The company has generated more than $350 million from at least 41 financial institutions through settlements or license agreements. The companies with which DataTreasury has entered into license agreements include JPMorgan Chase, HSBS Bank, UBS, Citibank, Edward  D. Jones & Co., Merrill Lynch & Co., Bank of New York/Mellon, PNC Financial Services Group, Electronic Data Systems Corp., Diebold, and First Data Corp.

Half of Bank Customers At Risk Of Switching

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NEW YORK (5/30/13)--Within the next six months, 10% of retail banking customers worldwide say they likely will leave their bank, and an additional 41% of customers say they are unsure if they will stay or go, according to the World Retail Banking Report 2013.

That indicates one out of every two banking customers are at risk of switching, said the report.

Credit unions will want to take steps to make sure the people who do switch banks, switch to credit unions.

Meanwhile, banks are being told to make their customers a more important concern. "With half of retail banking customers globally not feeling loyal to their bank, it's clear that banks need to close the gap and build customer-centricity into their DNA," said Jean Lassignardie, chief sales and marketing officer, Capgemini Global Financial Services.

One way to draw new members--or keep existing members--is to go mobile. "The future of retail banking is mobile," said Patrick Desmares with Efma. "By the end of 2013, there will be more mobile devices than people. Banks need to go where the opportunity is ... and that is mobile."

The report is an annual survey of 18,000 customers globally conducted by Capgemini and Efma. The results are worse for banks but not for credit unions. In the 2012 survey, less than half of customers said they might leave their banks.

"Quality of service" emerged as the single most important factor driving customers to switch banks across the 35 markets studied, with the exception of North America, where fees mattered most, followed closely by quality of service.

Positive customer experiences are strongly correlated with the trust customers place in their financial institutions, and with customers' belief that their financial institutions have a good understanding of their needs, said the report. However, trust in banks worldwide has been eroded by scandals, including the rigging of benchmark interest rates, antimoney laundering schemes and other controversies, it added. Today, 49% of all consumers don't completely trust their financial institution.

Customers traditionally were hesitant to change banks because of the perceived complications or barriers involved. Britain plans to stimulate competition by introducing portable account numbers and new rules that allow customers to switch accounts within seven days.

In the survey, banks in nearly every region improved the percentage of customers having a positive experience in 2013. Latin America witnessed the greatest increase at 11.9%, followed by Western Europe at 7.2%, and North America at 5.5%.

Eleven of 35 markets recorded an increase of more than 20% in the number of customers with positive experiences, according to the study. Conversely, nine markets saw a decline in positive experience. Fifteen markets remained even.

Customer satisfaction was greatest in North America, with Canada taking the top spot with a 61% rating and the U.S. following with 57%. Italy, Saudi Arabia, China and Brazil saw the greatest improvements in share of customers with a positive experience. Hong Kong had the lowest rating at 15%, and Japan scored 22%. The report attributed the low ratings to more demanding customers in these markets.

Forty-four percent of those surveyed say they are satisfied with the consistency of experience at their bank across channels, while 57% don't think there's a good product-channel fit, and 63% feel strongly that banks could do a better job understanding their needs and learning their preference.

Fostering service excellence is one of the three prongs of the Credit Union National Association's Unite for Good campaign toward reaching CUNA's strategic vision for the credit union movement, in which "Americans choose credit unions as their best financial partners."

To download the full report, use the link.

Three Michigan CUs Net Innovation Awards

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LANSING, Mich. (5/30/13)--The Michigan Credit Union League's first annual Innovation Awards were given to three Michigan credit unions at its Annual Convention & Exposition.

MCUL launched the innovation contest earlier this year to showcase and highlight cutting-edge programs, products and services in the state's credit unions (Michigan Monitor May 28).

Jackson (Mich.) Community FCU, which began offering a recourse lending program in partnership with a local auto dealer, was the winner in the up to $50 million asset category. It allows members who have bad credit or unusual financial situations to get regular financing for responsible vehicles with affordable prices, payments, terms and rates. Through the program, the dealership backs the loan 100%.  If the member does not make the payments, the car is repossessed and returned directly to the dealership.

Frankenmuth (Mich.) CU is the winner in the $50 million-$400 million asset category. A few months ago, the credit union launched The Great $2 Million Community Challenge. The credit union is tracking how much it saves members who refinance their loans with Frankenmuth. When it saves members $2 million in interest, it will donate $10,000 to five charities. Members had the chance to vote on which charities would receive $2,000 each on Facebook and the credit union's website. Since September, the credit union has saved members more than $700,000.

Michigan First CU in Lathrup Village won in the more than $400 million asset category for its Every Member's Experience Counts program. The program induces members to build stronger emotional connections with the credit union by treating them the way they want to be treated. Members are broken into four different groups, depending upon how they emotionally approach handling finances. The groups are identified by different colors. Members' particular emotional or color predominance is then stored at the account level to help staff know how to best connect with a particular member.

Sixteen credit unions of all asset sizes submitted entries.

"We salute the winning credit unions for their forward-thinking, creative programs that take the credit union difference to a whole new level," said MCUL CEO David Adams.

HGTV Host, CU Dedicate Playground

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LANSING, Mich. (5/30/13)--Lake Michigan CU partnered with HGTV host Carter Oosterhouse to dedicate a new playground in Holland, Mich., with a ribbon-cutting ceremony May 11.

Click to view larger image From left, U.S. Rep. Bill Huizenga (R); HGTV personality Carter Oosterhouse; Jeremiah Kossen, vice president of operation for Lake Michigan CU, Grand Rapids, Mich.; and Holland, Mich., Mayor Kurt Dykstra cut the ribbon opening a new playground at Holland's Windmill Island. (Photo provided by the Michigan Credit Union League)
The project was initiated by Oosterhouse's charitable foundation, Carter's Kids, which aims to create and promote awareness of fitness and self-esteem for America's youth, the Michigan Credit Union League said (Michigan Monitor May 29).

U.S. Rep. Bill Huizenga (R-Mich) and Holland Mayor Kurt Dykstra took part in the dedication ceremonies.  

Funded by Grand Rapids, Mich.-based Lake Michigan CU and built by its employees, the new playground serves west Michigan youths as part of Windmill Island in Holland.

Huizenga is a long-time credit union supporter. In 2012, he co-sponsored legislation to raise the cap on credit union member business lending.

Lake Michigan CU recently landed Oosterhouse as its spokesman. Oosterhouse, the host of the new HGTV network show "Million Dollar Rooms," is a native of Traverse City, Mich., and a member of the credit union (News Now March 8).

Mid-Atlantic Corporate's Net Income Up 124%

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MIDDLETOWN, Pa. (5/30/13)--Mid-Atlantic Corporate FCU reported net income of $13.56 million in 2012--a 124% increase over 2011.

Year-end capital at the corporate was $176.05 million, including $167.65 million in tier-one capital. Assets were $3.22 billion, compared with $3.08 billion in 2011. Average assets totaled $3.43 billion, or $501.4 million more than in 2011.

Mid-Atlantic Corporate's merger in February 2012 with VACORP FCU contributed to the increase in assets, capital and net income.

"Mid-Atlantic Corporate is a safe and fiscally sound financial cooperative," said Jay Murray, Mid-Atlantic Corporate president/CEO. "We exceed all four of the required capital ratios that ensure our Corporate is adequately prepared for the future."

At year-end, the corporate's leverage ratio stood at 5.13%--or 1.13% higher than the level mandated by the National Credit Union Administration. The retained earnings ratio was 0.75%, which exceeds the 0.45% that will be required by October.

Its tier-one risk-weighted capital ratio was 20.84%, while its total risk-weighted capital ratio was 22.32%. Both ratios exceed the regulatory requirements of 4% and 8%, respectively.

MCUL, MCUF Honor Achievement At Annual Meeting

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LANSING, Mich. (5/30/13)--The Michigan Credit Union League's annual Honor Awards Breakfast took place May 18, recognizing the achievements of outstanding members of the credit union community during the past year.

Winners of this year's league awards (Michigan Monitor May 28) include:

  • Award for Excellence in Consumer Education--Jeremy Cybulski, Co-op Services CU, Livonia;
  • Credit Union Youth Advocate of the Year--Cindy Lardie, TBA CU; Traverse City;
  • Young Professional of the Year-- Kaye Chervenak, Alliance Catholic CU, Troy;
  • Chapter Effectiveness Award--Metro West Chapter;
  • Outstanding Credit Union of the Year--United FCU, Saint Joseph;
  • Credit Union Professional of the Year--Dan Harp, vice president of lending, Dort FCU, Flint; and
  • Distinguished Service Award--Catherine Roberts, in-Fusion Group;
The Michigan Credit Union Foundation also presented its annual awards.

Jan Rose, president/CEO of E&A CU in Port Huron was the recipient of MCUF's Community Volunteer of the Year award. Rose has served on the boards of Habitat for Humanity, the Economic Development Association, Community Action Agency, The Community Foundation, YMCA and the Blue Water Land Fund, and the Board of Trustees of Port Huron Hospital.

Communicating Arts CU in Detroit received the MCUF International Credit Union Development Award. CACU has impacted credit unions and their members in more than 10 countries during the past nine years through its involvement with World Council of Credit Unions.

Beginning in 2003 through a partnership with FULM Savings House in Macedonia, CACU lobbied to establish credit union law and development trainings for Macedonian staff. CACU also is involved in World Council in Africa, supporting the Busia Compassionate Centre program in Kenya and Global Women's Leadership Network initiatives.

This year's Chapter Effectiveness award went to the Metro West chapter, recognizing its efforts in political action committee fundraising, legislative advocacy and community service. In 2012, the chapter helped start up a food pantry, provided healthy alternatives to at-risk girls and women in Detroit, worked on boarding up abandoned homes, and helped with a center for troubled youth. Through 47 grant applications the chapter received, the chapter also was able to support 12 smaller charities.

U.S. Volunteers Learn Corporate Social Responsibility

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PUNTA CANA, D.R. (5/29/13)--More than 100 U.S. credit union board members learned lessons in social responsibility last week from $58 million asset credit union Maimon in Punta Cana, Dominican Republic.

Click to view larger image Victor Miguel Corro (left), Worldwide Foundation for Credit Unions vice president, translates as Board Member Ramon Diaz, of Maimon--a Dominican Republic credit union--shares his credit union's experience in corporate social responsibility.
The World Council of Credit Unions (WOCCU) facilitated the training with Maimon as a part of the Credit Union National Association's Volunteer Institute for a second consecutive year.

Maimon is affiliated with Asociacion de Instituciones Rurales de Ahorro y Credito Inc., (AIRAC), World Council's member association in the Dominican Republic.

Maimon board member Ramon Diaz opened with a presentation on the credit union's story and ways in which it helps its community. In 1990, in the midst of a banking crisis that had left many families without savings, 26 members with $300 founded Maimon. Today, it has 60,000 members and works on the sustainable development of their communities by establishing what they call "social responsibility reserves."

That fund meets basic needs, improves schools and offers cultural events in the community. Maimon also has partnered with other organizations to develop a "business incubator," which provides micro-entrepreneurs with start-up capital loans and free advice on business planning, financial management and accounting.

Click to view larger image Maimon, a World Council of Credit Unions member association in the Dominican Republic, manages a funeral home for members who cannot afford to bury loved ones. (Photos provided by the World Council of Credit Unions)
An example of Maimon's community involvement is the construction and management of a funeral home for those who cannot afford to bury their loved ones. Every member of Maimon is granted access to the service, including a hearse and crypt, for a monthly fee of 40 cents.

"Maimon's commitment to the growth and prosperity of its community readily encompasses the values that all credit unions strive toward," said Kevin Smith, CUNA director of volunteer education. "It's an invaluable benefit for our volunteers to be able to witness this eye-opening testament to how engaged a truly community-first credit union can be."

After the presentation, CUNA pledged $1,000 toward Maimon's social responsibility efforts, matching last year's donation.

Victor Miguel Corro, Worldwide Foundation for Credit Unions vice president, provided translation at the event and gave insight into the Dominican economy and credit union system.

"Part of what we do at World Council is connect peers in the industry, and having Ramon participate in the Leadership Institute was key to this priority," Corro said.

Corro also manages WOCCU's International Partnerships Program, through which AIRAC receives advocacy support from the Wisconsin Credit Union League.

CUNA Volunteer Institute gathers volunteers each year who serve on credit union boards across the U.S. Those attending gain an understanding of issues affecting their credit unions, including enterprise risk management, economic trends and strategies for reaching a younger demographic. Participants also can earn a Certified Credit Union Volunteer designation as expert board members.

For more information, use the link.

CU System Briefs (05/29/2013)

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  • O'FALLON, Ill.  (5/29/13)--Two Scott CU employees were robbed on Friday while loading money into an ATM in O'Fallon, Ill. A suspect approached the two employees and indicated that he had a weapon. He forcibly took the money and ran from the scene ( FOX2Now.com May 24).  Police are continuing their search and investigation. Both employees involved were unharmed ...
  • NEW CASTLE, Del. (5/29/13)--A man was robbed outside the Del One CU, New Castle, Del.,  after making an ATM transaction Sunday evening. Police say the man was driving away from the ATM when a car pulled in front of his vehicle and stopped. Two men approached his car and demanded the money he just withdrew from the ATM. After the victim turned the money over, the robbers hit him in the face with a handgun and drove off. The victim was later treated at a local hospital (Times Union May 27) ...
  • ENDICOTT, N.Y.  (5/29/13)--Visions FCU is warning members and non-members that someone is using the credit union's name in a phishing scam involving text messages. A text message  stating that their Visions card had been deactivated was sent to the recipients cell phones. They were told to call the number provided in the text immediately to correct the problem. These texts were not from the credit union but from people trying to steal bank and card information. Visions FCU President Tyrone Muse instructed people to not reply to the text message and, if they had already done so, to contact the credit union, where its staff would work with them to fix the problem ...

Christian Sci. Monitor: CUs, Co-ops Have No Investors To Please

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MADISON, Wis. (5/29/13)--The benefits that credit unions and cooperatives offer consumers through their cooperative ownership structure were emphasized in a May 26 article in the Christian Science Monitor.

"If you buy products--from a bunch of carrots to a car loan--why not buy from a company you own?" the article, headlined, "Co-op: shopping where you own the place," asked readers.

Member-owned credit unions added nearly two million members in 2012, the article said.

Commercial banks face competitive pressures because they must serve two masters: customers and shareholders, said Stephen Brobeck, executive director Consumer Federation of America, a Washington-based group of nearly 300 consumer advocacy organizations told the Christian Science Monitor. Banks tend to favor investors, Brobeck told the Monitor.

In contrast, members of Pennsylvania State Employees CU (PSECU), Harrisburg, Pa., pay $1 to join the credit union. To qualify for membership, they must be employees of state, county, and municipal governments, or graduates of affiliated universities, the article said.

PSECU members receive benefits such as a free credit score report each month. ATM surcharges are reimbursed up to $20 per month. In January, PSECU distributed $10 million in dividends to 234,000 members. The average beneficiary received $42. Some members received more than $3,000.

Cooperatives are experiencing growth in others sectors as well, the article said. Grocery co-ops, with 1.3 million members in the U.S., have increased memberships and revenues at a 10% annual rate during the past decade.

To read the article use the link.

In The Media: 'Liberate' CU Lending

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MADISON, Wis. (5/29/13)--A bill in Congress to raise credit unions' member business lending (MBL) cap should be cheered not just because of its bipartisanship, but also because raising the cap "spreads freedom," according to one of two articles that discussed the MBL issue this past week.

"Those concerned with government eroding options for entrepreneurs should cheer this legislation, which lifts regulatory barriers to an untapped source of capital for start-ups--America's credit unions," wrote John Berlau, senior fellow at Competitive Enterprise Institute, a nonprofit public policy organization, in Daily Caller.com (May 24).

He was referring to Senate Bill 968, sponsored by U.S. Sens. Mark Udall (D-Colo.) and Rand Paul (R-Ky.), which would raise the MBL cap to 27.5% of assets from 12.25%.

Traditional sources of small business lending have dried up, and "credit unions have stepped in to fill the void," Berlau wrote.  He referred to an interview on FoxBusiness.com with Rohit Arora, CEO of the Biz2Credit, who noted that government barriers to credit-union business lending would deprive thousands of entrepreneurial ventures of seed capital credit unions could provide.

"The bills don't go far enough; the cap should be eliminated entirely," wrote Berlau.  For the full article, which also cited statistics from the Credit Union National Association, use the link.

In another article, Public Service CU CEO David Maus said his Denver-based credit union expects to hit the MBL cap within a year unless Congress raises it (Coloradoan.com May 27). Of bankers' opposition to raising the cap, Maus said that even if credit unions doubled that the 6% market share they have, "it wouldn't hurt [the banks] but it would add tremendous benefit to the economy. We help a lot of small business, and usually the people we help are people who have already been turned down by banks."  Use the link for the full article.

CUNA has said that raising the MBL cap will generate $13 billion in funds for small business loans and help create 140,000 jobs.  CUNA, the leagues, and credit unions are working to remove barriers through the political process.

Removing barriers is one of the three prongs of CUNA's Unite for Good campaign toward reaching CUNA's strategic vision for credit union movement, in which "Americans choose credit unions as their financial partners."

TransUnion: Credit Card Delinquencies Drop

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CHICAGO (5/29/13)--The national credit card delinquency rate--the ratio of borrowers 90 or more days past due--decreased to 0.69% in the first quarter from 0.73% a year earlier, according to the most recent TransUnion report.

"We traditionally see credit card delinquencies and balances decline during the first three months of the year as many people pay down their holiday shopping balances or use their tax refunds to pay off their debts," said Ezra Becker, vice president of research and consulting in TransUnion's financial services business unit.

"In addition to the seasonal quarter-over-quarter drop, the year-over-year improvement in credit card delinquencies is indicative of how consumers continue to value their credit card relationships," Becker said.

The delinquency rate experienced a steep 18.8% seasonal decline from the end of 2012, when it stood at 0.85%, said the Chicago-based global company that specializes in information gathering and risk management.

At credit unions, members' 60-plus-day delinquency rate declined to 1% during March from 1.1% in February, according to the Credit Union National Association's March monthly sample of credit unions.

Average credit card debt per borrower also dropped 1.7% to $4,878 in the first quarter from $4,962 in first quarter 2012, said TransUnion. On a quarterly basis, card debt decreased 4.8% from $5,122 in the fourth quarter.

Since the beginning of the recession at the end of 2007, the credit card delinquency rate has declined five out of six first quarters on a quarterly basis. The average first-quarter decline for that timeframe has been 7.2%.

Twelve states saw their delinquency rates rise year over year, with Massachusetts and North Dakota the only ones to experience double-digit basis point increases--and those from low starting points.

Sixty-five percent of metropolitan statistical areas (MSAs) experienced declines in their respective delinquency rates in first quarter relative to one year ago. That is improved from the previous quarter, when only 33% of MSAs experienced year-over-year decreases. Some MSAs experiencing the largest year-over-year decreases in the first quarter included: Seattle (28.1% decline to 0.41%), Denver (26.9% decline to 0.49%) and Salt Lake City (22.6% decline to 0.48%).

The TransUnion quarterly analysis of credit card performance also examines origination rates, which are evaluated one quarter in arrears to account for the reporting lag of new accounts.

In the fourth quarter, new credit card originations dropped 1.6% relative to fourth quarter 2011 (to 7.57 million from 7.70 million accounts). The share of non-prime, higher-risk originations (with a VantageScore 2.0 credit score lower than 700 on a scale of 501-990) was 28.14% in the fourth quarter, slightly below 28.38% in fourth quarter 2011, but higher than the 27.72% in fourth quarter 2010.

"Though fourth-quarter credit card originations had dropped compared to the prior year, the number of new credit cards entering the marketplace is still significantly greater than what we saw just a few years ago," Becker said.

TransUnion forecasts credit card delinquencies to increase slightly to roughly 0.71% in the second quarter, based on current economic assumptions.

Visa, MasterCard Sue Retailers Opposed To Interchange Settlement

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BROOKLYN, N.Y. (5/29/13)--Visa Inc. and MasterCard Inc.Friday filed a lawsuit seeking declaratory judgment from a Brooklyn, N.Y., federal court against 11 retail organizations that opted out of a $7.25 billion interchange settlement proposal in an antitrust lawsuit against the card companies.

The card companies seek a declaration from the U.S. District Court Eastern District of New York that their fee practices from Jan. 1, 2004, to the proposed settlement date of Nov. 27, 2012--the period in which merchants opting out could seek damages under the interchange settlement--did not violate the federal and state antitrust laws.

Monday was the deadline for nearly eight million retailers to opt out of the proposed settlement, which would end an eight-year battle over fees the card companies charge merchants.  Last week Wal-Mart and 18 other major retailers said they would opt-out and consider separate legal action. They indicated the settlement offers inadequate compensation for the billions of dollars they pay in interchange fees each year and forces them to sign away rights to initiate future lawsuits over antitrust issues (Reuters  May 24).

"A declaration in plaintiffs' (card companies) favor...is necessary to prevent the continuation of endless, wasteful litigation between defendants and plaintiffs," argued the Visa and MasterCard motion, noting that the settlement isn't the first between the card companies and the merchant community. It referred to a Visa check litigation settlement in 2003 in which Visa paid a "substantial sum of money." That settlement did not stop other litigation, such as the interchange fee litigation.

The lawsuit names only organizations that originally were party to the negotiations of the proposed settlement but who opted out. They include the National Association of Convenience Stores, National Grocers Association and National Restaurant Association.

Credit unions are not a party in the lawsuit, but the Credit Union National Association is monitoring the outcome. Credit unions and other financial institutions would be impacted by the settlement's terms, which would require a reduced interchange rate fee of 10 basis points for an eight-month period and would apply to all card issuers.

If the total interchange rate fee were reduced by $1.2 billion, those credit unions with card programs would lose about $50 million in total revenues, roughly 0.5 basis points of their total assets, CUNA said. The loss would hit a small number of credit unions with especially active credit card programs.

CUNA said that interchange revenue means credit unions can provide cost-effective, essential credit card services to their members. The temporary reduction in interchange revenue that credit unions would experience will not likely find its way into the pockets of consumers, but more likely will go into those of merchants, said CUNA President/CEO Bill Cheney (News Now Nov. 12).

The card companies' motion for declaratory judgment noted that the settlement would be the largest private antitrust damages recovery in U.S. history and would require the card companies to make "significant changes" to some of their merchant rules.

AVCU's Meeting Hits Decade-high Attendance

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MONTPELIER, Vt. (5/29/13)--The Association of Vermont Credit Unions' Annual Meeting and Convention attracted more than 220 attendees last week, the event's largest registered attendance in more than a decade.

Association of Vermont Credit Unions Board members Bob Morgan, left, of North Country FCU, South Burlington, Vt., and Jim St. Peter, of New England FCU, Williston, Vt., were elected by acclamation to three-year terms at the association's annual meeting. (Photo provided by Association of Vermont Credit Unions.)
The conference exhibit hall was sold out with 20 exhibitors. Five vendors participated for the first time.

AVCU Board members Bob Morgan, North Country FCU, South Burlington, and Jim St. Peter, New England FCU, Williston, were elected by acclamation to three-year terms.

A bylaw amendment proposed by the board was passed by a voice vote. It would:

  • Allow for meetings and/or votes of the AVCU membership to be conducted through modern technological means whereby participants may be aware of comments by others, visually or audibly.  Voting electronically would be permissible when appropriate safeguards ensuring the integrity of the process are in place;
  • Create an associate membership category that carries no voting or right to hold office; and
  • Make housekeeping changes replace outdated bylaw provisions that were no longer relevant.

Oregon CUs Urge Parity On Occupancy Rule

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SALEM, Ore. (5/29/13)--Oregon state-chartered credit union representatives urged adoption of an occupancy rule that gives parity with rules applying to federally chartered credit unions in a meeting with the state Department of Consumer and Business Services (DCBS) this month.

In February, DCBS adopted a temporary rule allowing a state-chartered credit union up to six years to partially use unimproved property held for future expansion, according to the Northwest Credit Union Association (Anthem Recap May 24).

"It can be difficult to obtain permits, particularly when cities change building codes halfway through a project that can slow down the entire process," said Jerry Liudahl, chief credit officer at Oregon Community CU in Eugene, told NWCUA. "A three-year window is too narrow to effectively get things done and we would appreciate the DCBS permanently adopting a rule that gives us parity with the federal act."

DCBS took the next step toward adopting the rule in early May, convening an advisory group made up of state-chartered credit unions to discuss the permanent adoption of the rule. Nearly one third of Oregon's state chartered credit unions sent a representative to participate, said John Trull, NWCUA director of regulatory advocacy.

The temporary rule was set to expire after 180 days on July 31, said Rick Blackwell, DCBS senior policy analyst. Blackwell asked if there was interest in adopting the text of the temporary rule on a permanent basis. All of the credit unions' representatives expressed support for permanent adoption of the rule, said NWCUA.

Participants also were asked how the rule will impact small business--fiscally and from a regulatory standpoint. The rule potentially lowers the long-term cost for facilities and doesn't create a compliance burden, said Kevin Cole, chief financial officer for Maps CU in Salem.

Several participants encouraged DCBS to define unimproved real property, by using the same definition proposed in the National Credit Union Administration's Fixed-Asset Rule.

"Defining unimproved property ensures credit unions and the regulator are on the same page," Trull said.

After receiving input from the advisory group, the DCBS filed the notice of proposed rulemaking with the Secretary of State office.

CUNA's E-Scan: Mobile Services Head Three Of Top 10 Trends

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MADISON, Wis. (5/29/13)--Mobile banking, mobile payments and mobile malware head up the list of Top 10 trends credit unions will need to consider as they create their strategies and goals, according to the Credit Union National Association's just-released 2013-2014 Credit Union Environmental Scan.

The 86-page E-Scan is a strategic planning tool that boards and senior management can use during their strategic planning sessions in the summer and fall, said CUNA Editorial Director Steve Rodgers.

Mobile payments "is a new ballgame," according to the E-Scan. "Members used to come to credit unions to get cash and credit union-branded checks or plastic cards. But members won't be coming to credit unions to get their mobile payment-branded devices. Mobile payments will be driven by access, not devices. The challenge will be to retain your members in a mobile payments world."

The scan notes that mobile banking has gone from "cutting edge to mainstream faster than any other financial innovation" and is becoming a "basic expectation, especially among younger consumers."

And the proliferation of mobile services and devices have attracted malicious software (malware), which means credit unions must invest in malware detection and prevention while educating members to protect themselves.

Other key trends credit unions can expect to consider during their planning session:  

  • A rebound in lending;
  • Meager earnings due to downward pressure from the Federal Reserve's low-interest-rate policy;
  • The Unite for Good campaign toward the strategic vision in which Americans choose credit unions as their best financial partner;
  • Service in the new frontier--the unbanked and underserved;
  • A heavier compliance burden;
  • Prioritization  for CEO succession planning as more CEOs retire; and
  • Raising Gen Y's awareness about credit unions.

The E-Scan is available in paper or electronic formats and includes six chapters on recurring topics such as lending, marketing/demographics, economics, legislation and finance, and six chapters addressing issues of the day--such as mobile payments, serving the underserved, enterprise risk management, CEO succession planning, and more.

The E-Scan can be purchased by CUNA-affiliated credit unions as a single report or as part a strategic planning package that includes a DVD, monthly newsletter and PowerPoint presentation. For more information, use the link.

Minnesota Foundation CU Builder Award Goes To Krall

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ST. PAUL, Minn. (5/28/13)--Gail Krall, a 34-year leader of Minnesota Power Employees CU in Duluth, was honored with the Minnesota Credit Union Foundation's Credit Union Builder Award, which recognizes those who have dedicated time and energy to building the credit union movement.

Nominations for the award are made by credit unions and other organizations in honor of, or in memory of, a significant individual who has been instrumental in their success.

Krall became president/CEO of MPECU in 1979. During her tenure, it has grown to $85 million in assets from $1.9 million. Krall will retire later this year.

Krall has played a leadership role in the Minnesota credit union movement, serving on the Minnesota Credit Union Network (MNCUN) and Network Service Corp. Board of Directors for five years. She also has been a supporter of shared branching, through her role with the Minnesota Credit Union Service Corp.

Krall is an advocate for credit unions in the political arena through her work on the MnCUN's Political Involvement Committee, and recently was inducted into the Credit Union House Hall of Leaders in Washington, D.C.

She also was appointed to the Minneapolis Federal Reserve Bank's Community Depository Institutions Advisory Council.

Krall joins 17 other individuals who have been honored during the past six years with the MnCUF's Credit Union Builder Award.

Great Basin FCU Approved As SBA Lender

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RENO, Nev. (5/28/13)--The Small Business Administration granted approval to Great Basin FCU, Reno, Nev., to become one the agency's lenders.

The SBA approval allows the $125 million asset credit union to aid in the start-up or expansion of small businesses. Great Basin FCU is the first new SBA lender in Northern Nevada in more than nine years.   

"Our community needs this now more than ever," said Jennifer Denoo, Great Basin FCU chief operations officer. "We believe we can fill a gap in our market to assist small businesses needing loans in the $50,000 to $500,000 range.

"We look forward to being more than just a lender," explained Denoo. "We are here to see the process through from beginning to end. We have always prided ourselves in helping educate our members and support them in reaching their goals. So while we may not be able to give them a loan the day they come in, we will always make the time to listen to their dream and connect them with the resources they need to achieve it."

The Small Business Lending Enhancement Act introduced by Sen. Mark Udall (D-Colo.) would increase credit unions' member business lending cap to 27.5% of assets, from the current 12.25% (News Now May 17). Doing so would generate $13 billion in new loans and create 140,000 jobs, the Credit Union National Association said.

CU System Briefs (05/28/2013)

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  • FARMERS BRANCH, Texas (5/28/13)--Generations FCU in San Antonio, Texas, last week held its last event in support of National Financial Literacy Month. More than 40 high school students from Churchill High School participated in the event, a scavenger hunt  at the credit union. Students heard from the CEO, toured the vault, spoke to tellers and learned the day-to-day operations of the credit union. Generations FCU also partnered with the Alamo Community Colleges in the district to bring financial literacy classes to their students. Its Student Life Team taught more than 25 classes to hundreds of students during the month (LoneStar Leaguer May 24) ...
  • WICHITA, Kan. (5/28/13)--Wichita (Kan.) FCU has announced Jane Hammil will become its next president. Hammil is currently senior vice president and chief administrative officer at CU of America, also based in Wichita. She expects to begin her new role as president early next month. Hammil has been with CUA, Kansas' second-largest state-chartered credit union, for more than four years and has 27 years of experience in financial services. Hammil will replace Wayne Warfel, who is retiring after 19 years (The Wichita Eagle via Kansas.com May 23) ...
  • WILLIAMSPORT, Pa (5/28/13)--A member of the board of directors from Williamsport, Pa.-based Horizon FCU will be on the ballot in November for the Republican Loyalsock Township Supervisors seat. Paul Nyman received 579 votes during  lastTuesday's primary election and will continue his political campaign for the November election.  Nyman served as the Susquehanna Valley Chapter president in 2002, 2004, and 2013 and actively participates at the Governmental Affairs Conference and Hike the Hill events, said the Pennsylvania Credit Union Association (Life is a Highway May 24) ...

N.C. CU Talks Tax Exemption, MBLs In Newspaper

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CHARLOTTE, N.C. (5/28/13)--Bob Bruns, president/CEO of Charlotte (N.C.) Metro CU, discussed the necessity of maintaining credit unions' federal tax exemption and the benefits of raising their member business lending (MBL) cap to better meet local business needs, in a May 21 article in the Charlotte Business Journal.

In the question-and-answer article, Bruns said that maintaining credit unions' federal tax exemption is a more pressing issue at the moment.

"Right now, I'm more concerned about tax-exemption," Bruns told the Journal. "Credit unions are tax-exempt. And they're talking about changing the tax code."

He added: "We're doing a little prevent defense where we're making sure they understand what a credit union is and that we return the benefit to consumers 10-fold. Our motivation is different than the banks. Look at the mess they got in, and credit unions did relatively well. We're hopeful they'll see the light and leave us tax-exempt. I'm afraid if we were taxed, credit unions would be absorbed and you'd be left with just one choice, and that's no choice at all."

CUNA has joined with affiliated state credit union leagues to launch a large-scale, nationwide grassroots-mobilization campaign urging credit union members across the country to deliver a united message to the U.S. Congress: "Don't tax my credit union!" The campaign is being launched at a time when the U.S. House and Senate have made broad-based tax reform a major priority. The initiative will urge lawmakers as part of any final tax reform plan to preserve the federal tax exemption credit unions receive as not-for-profit, member-owned cooperatives.

Bruns was asked if he thought it was necessary to raise credit unions' MBL cap.

"I don't think we should have a cap at all," Bruns told the Journal. "The Treasury did a study and 67% of business in America is small business. If you want to get the economy cooking again, we need to stimulate small-business lending. The big banks consider it too small to be worth it. The community banks are still hurting pretty bad from the downturn and are reluctant to lend. Credit unions stand ready to fill that void. We've just got to convince Congress."

U.S. Sen. Mark Udall's (D-Colo.) Small Business Lending Enhancement Act (S. 968), introduced in the Senate May 16, would increase the credit union member business lending cap to 27.5% of assets, from the current 12.25% (News Now May 17). Doing so would generate $13 billion in new loans and create 140,000 jobs, the Credit Union National Association said.

To read the article, use the link.

Wanted Worldwide: CU Social Media Strategy

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MADISON, Wis. (5/28/13)--
Participants from five countries pose in front of the World Council of Credit Unions headquarters during last week's Build the Brand Workshop to develop strategies for reaching a younger audience through social media.  The workshop was funded by Vancity CU, Vancouver, B.C
Thirteen credit union and trade association marketing executives from five countries met last week at World Council of Credit Union's (WOCCU)  Madison, Wis., headquarters to develop strategies for credit unions to reach a younger audience through social media.

Executives from Australia, Brazil, Canada, Korea and the U.S. met for a Build the Brand Workshop funded by a grant from Vancouver, B.C.-based Vancity CU. The event built on last year's inaugural Build the Brand Workshop, which identified credit union messaging that resonates with today's consumers worldwide.

"Social media presents credit unions worldwide with an opportunity to deepen their relationship with members, especially Generation Y," said Brian Branch, WOCCU president/CEO. He noted that the results will be shared with the rest of the global community at WOCCU's  2013 World Credit Union Conference in Ottawa, Canada July 14-17. For more information, use the link.

David Southall, president/CEO of Innovations FCU, Panama City, Fla., and Build the Brand Workshop participants brainstorm ways to provide members relevant and timely social media content. One idea was to use employees across departments.
The day and a half workshop was moderated by Shel Holtz, principal of Holtz Communication + Technology and an expert in integrating technology into communications strategies. 

Workshop participants from outside the U.S. included:

  • Russell Allert, online communications coordinator, Queenslanders CU, Australia;
  • Daniel Ferretti, chief marketing officer, SICREDI, Brazil;
  • Heather Harmse, digital marketing manager, Vancity CU, Canada;
  • Gail Stepanik-Keber, chief brand and corporate social responsibility officer, Servus CU, Canada;
  • Tania Goodine, vice president brand, Libro Financial Group, Canada; and
  • Kevin Heo, international program officer, the National Credit Union Federation of Korea.
Russell Allert, online communications coordinator, Queenslanders CU, Australia, explains the importance of credit unions employing social media to engage with and listen to their members at the Build the Brand Workshop, hosted by the World Council of Credit Unions in Madison, Wis. (Photos provided by the World Council of Credit Unions)
Participants from the U.S. included:

  • David Southall, president/CEO, Innovations FCU;
  • Tansley Stearns, director of impact, Filene Research Institute;
  • Connie Fedor, communications manager, University of Wisconsin CU;
  • Sean McDonald; director of business development, MidState FCU;
  • Janet Garkey, manager of member education, Credit Union National Association;
  • Tara Bross, marketing specialist, Linn Area CU; and
  • Josh Allison, relationship development manager, Horizon CU.
Participants from all five countries addressed the challenges their credit unions face in meeting consumer expectations for social media engagement with limited resources, including a lack of employee training, relevant content curation tools and technological incompatibility with mobile and tablet devices.

They agreed that credit unions must incorporate a content strategy that articulates cooperatives' social responsibility philosophy, which they found resonates with younger audiences' personal values.

"The difficulty in attracting younger members is not unique to credit unions in the U.S.," said workshop participant Sean McDonald in a blog post after the event. "Our challenges are the same, our focus points are the same, and our goals are aligned."

ACUC Speaker Gladwell: CUs Are David To Banks' Goliath

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NEW YORK (5/28/13)--Credit unions are David to the banks' Goliath, and credit unions should look to use their smaller size to their advantage in a financial services arena that is as unsettled as it ever has been, said author and reporter Malcolm Gladwell. He will keynote at this year's America's Credit Union Conference, June 30-July 3 in New York City.

Gladwell was interviewed for a feature article in Credit Union Magazine by Paul Gentile, executive vice president, strategic communications and engagement, at the Credit Union National Association, which presents the conference.

Gladwell is known for turning conventional wisdom on its head as he does in his soon-to-be-released book, "David vs. Goliath."

"I am interested in the idea that a lot of our intuition about what is an advantage and what a disadvantage is are wrong--that we confuse those two things," Gladwell said. "We can make a list of things that help us or hurt us. I think the wrong things are on the list." 

Future success is not ensured by being more powerful in the marketplace, because bigger is not always better,  Gladwell explained.

"They [bigger institutions]  innovate less," he added. "They have less of a need to talk to their customers. They are less nimble. Prestige can limit you. People who are No. 1 in a marketplace have a smaller degree of freedom.

"True innovation comes from the marginal people who push innovation into the center," he concluded.

To read the full article, use the link. For more information about America's Credit Union Conference, use the link.

CUs Rallying To Raise Funds For Tornado Victims

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MADISON, Wis. (5/28/13)--While Oklahoma credit unions and staff, volunteers and members try to rebuild their lives after last week's tornados in Moore and Shawnee, credit unions around the country are doing what they do best: putting the cooperative, people helping people philosophy in action.

Many credit unions and state-level credit union foundations are working to collect funds to assist in the recovery. Foundations from other states are approving contributions for the recovery to assist the Oklahoma Credit Union Foundation in helping roughly 26-30 employees who have so far reported damages or have lost their homes.

The Louisiana Credit Union Foundation told Louisiana credit unions it made a donation on their behalf and would continue to work with Oklahoma's foundation (eNews May 22).

The Ohio Credit Union Foundation announced it had approved a $5,000 grant to assist.  "We know the need by our credit union friends in Oklahoma is great," said Stan Barnes, chair of the OCUF Board of Trustees. "The images from the scene are heartbreaking. It is the hope of the (Ohio) foundation that this contribution can help in the recovery process, and assist with the immediate needs of credit union members and staff impacted by this tragedy."

Those wishing to donate funds to assist credit union people in Oklahoma should make checks payable to the Oklahoma Credit Union Foundation, mark them designated for the Tornado Disaster Relief Fund and send to:

Credit Union Association of Oklahoma

631 E. Hill Street

Oklahoma City, OK 73105

For more information, contact Carrie Buchholz at 405-702-8622, ext. 215 or at carrie@cuaok.org.

The Texas Credit Union Foundation also is taking online donations and assisting the Oklahoma foundation in its disaster relief grant process.

Several credit unions have announced they are raising funds for victims.  Meritrust CU in Wichita, Kan., said last week it was delivering a corporate donation totaling $10,000 to the Oklahoma Credit Union Foundation this past Friday.

"Standing back and not helping our neighbors who are suffering in Oklahoma was not an option," said James Nastars, president/CEO of the $860 million asset Meritrust. "It's times like these when we all need to rally together. These donations from our members, staff and board of directors are coupled with our thoughts and prayers," he said.

The credit union's branches became donation sites for needed supplies, including water, baby formula, diapers, wet wipes, non-perishable food, pet food, paper towels, blankets, flashlights and batteries. Meritrust expected to deliver those Friday to the Credit Union House in Oklahoma City, where the Oklahoma foundation will distribute the items.

Clear across the country, Focal Point FCU, a $46.4 million asset credit union in Syracuse, N.Y.,   set up a relief fund and invited members and the community to make donations to be sent to the Oklahoma foundation. (Syracuse.com May 24).

It said it was prompted to assist after seeing photos posted by Tinker FCU of its destroyed Moore branch on its Facebook page. The branch's safe deposit box vault--with 22 people hunkered inside--was the only thing still standing after the storm. That story made headlines across the nation.

Focal Point's branches in Syracuse, Chittenango and Canandaigua are raising money for the victims. "Credit unions have a unique kinship so, for us, it's one of our own that is in trouble," said FocalPoint CEO Marilyn Marra-Crolick in a press release.

Two CUs To Change Their Names

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MADISON, Wis. (5/28/13)--Two credit unions in Massachusetts and North Carolina announced last week they are changing their names.

After 57 years, Greensboro (N.C.) Health Care CU will become HealthShare CU, effective July 1. Also NMTW Community CU, Lowell, Mass., will change its name to Align CU in September.

Greensboro Health Care CU CEO Genice DeCorte said its board members did not make the change lightly, according to the North Carolina Credit Union League (Weekly Conversation May 24). They believed the existing name did not truly reflect its field of membership and they are seeking to align its name with current membership and its strategic plan.

The $30 million asset credit union serves members throughout North Carolina and the country. "With more services being offered electronically, members don't necessarily bank where they live," said DeCorte.

The name HealthShare CU is a broad reflection of its field of membership--health care employees and their "share" of ownership in the credit union.  The new name will also position the credit union for future growth in the health care industry, it said.

In Massachusetts, the $543 million asset NMTW Community CU, which originally served Northern Massachusetts Telephone Workers, changed its charter in 2005 to a community charter. It is open to anyone living, working or going to school in communities in eastern Massachusetts and southern New Hampshire (framinghampatch.com May 22).

NMTW Community President/CEO Ken Del Rossi emphasized that the name is the only thing changing. The credit union has partnered with Single Source Marketing of Danvers to develop a collaborative brand.

The new name reflects the credit union's core of what sets it apart and its member-driven approach, and is about providing the right products and services, tailored to each member's need, said Lauren Robinson, assistant vice president and marketing director.

Both credit unions emphasized they are not involved in any merger or acquisition.

CFE FCU Pays $4M To Rename Florida Arena

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ORLANDO, Fla. (5/28/13)--Lake Mary, Fla.-based CFE FCU has acquired the naming rights to UCF Arena, a 10,000-seat facility on the University of Central Florida campus, for $3.95 million.

The deal expands a longstanding relationship between the $1.4 billion asset credit union and the university.  UCF President John C. Hitt announced the agreement Thursday.  The university will receive $3.95 million over the next seven years, and the arena will be renamed CFE Arena.

The arena hosts UCF men's and women's basketball games, concerts by popular artists such as Elton John and Lady Gaga, and university and 20 high school graduation ceremonies each year as well as other events.

"We have been a consistent supporter of education in Central Florida since our founding in 1937 and recognize UCF's unique presence as an ever-expanding community of students, staff and alumni," said Joseph A. Melbourne Jr., president/CEO of CFE FCU, in a press release.

"Our partnership with UCF offers us an even greater opportunity to provide the next generation with lifelong financial management skills and the products and services they will need throughout their lives," he added.

The naming of the arena is the latest initiative in the credit union's focus to becoming more recognized and accessible on the UCF campus.  In November 2011, it acquired UCF FCU, which had a 40-year history with the university, and its on-campus  and just-off-campus locations.

The credit union will open a branch inside the CFE Arena, with flexible operating hours, especially during arena events. It also will install ATMs and its indoor space will include a lounge where arena visitors can sit, study and charge their electronic devices.

"Our branch in the CFE Arena will be more than a place to conduct financial business," said Katie Thomason, director of UCF development for CFE. "We want to create a cafe vibe with a comfortable lounge area and a self-service coffee bar."  The space also will be used for money management coaching and training for students. "Helping our members manage their finances responsibly is a priority for CFE."

Members Save $449M In SaveUp Program

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LIVONIA, Mich. (5/28/13)--SaveUp, a member engagement program from CU Solutions Group of Livonia, Mich., has helped users save $449 million and pay down $296 million in debt as of May.

The program, which rewards members for saving and cutting debt, has completed more than 75,000 financial education session, CU Solutions Group said.

"SaveUp's rewards system is based on behavioral science and innovations in technology to engage members, particularly Gen X and Gen Y," said Priya Haji, SaveUp CEO. "It creates an opportunity for credit unions to be a long-term partner in their members' financial future, while originating new products and services as the member's ally."

More than 40 credit unions nationally incorporate the SaveUp program into their marketing and business development plans.

More than 45% of SaveUp users connect weekly with their credit union branded content, CU Solutions Group said. SaveUp has generated more than 2,600 inquiries for new products and services for credit unions through personalized recommendations. Product inquiries include new credit card applications, refinancing car loans, mortgages, and savings related products, CU Solutions Group said.

CU Solutions Group announced its partnership with SaveUp in October (News Now Oct. 5).

Popularity, Growth of CUs Reported in Several Dailies

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PORTLAND, Maine (5/28/13)--The Maine Credit Union League's outreach helped secure the placement of two recent articles on the popularity and growth of credit unions in state daily newspapers.

An article that ran in both the Bangor Daily News and the Sun Journal noted that total membership in Maine credit unions had increased by 5% in the past six years, (Weekly Update May 24).

John Murphy, league president, was interviewed by Whit Richardson, Bangor Daily News business editor. In the article, Murphy cited the cooperative structure of credit unions as one of the movement's strengths and among the reasons why credit union membership in the state was 625,000 at the end of 2012, the highest year-end total ever.

Consumers prefer to deposit their money in local institutions, Murphy said.

Richards also interviewed Steve Clark, president/CEO of Bangor (Maine) FCU. Clark said his credit union experienced member growth at the end of 2012, followed by loan growth in early 2013.

Lund Elected Board Chairman Of CU Direct

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LAS VEGAS (5/24/13)--John Lund, president/CEO of America First CU, Riverdale, Utah, was elected board chairman of CU Direct Corp. during the credit union service organization's annual lending conference this week in Las Vegas.

Lund has served on CU Direct's board since 2005. The company's board of directors also elected Jeff March, president/CEO of Citadel CU, Exton, Pa., as vice chairman, and Nader Moghaddam, president/CEO of Financial Partners CU, Downey, Calif.,  as the board's secretary and treasurer.

Lund and Moghaddam were also elected to new three-year board terms. Company shareholders also elected Chuck Purvis, president/CEO of Coastal FCU, Raleigh, N.C., to his first term as a director on the board.  Previously, Purvis served on the board as an associate director.

During the company's shareholder's meeting, CU Direct President/CEO Tony Boutelle and the board recognized outgoing chairman, Joe Brancucci, president/CEO of GTE Financial FCU, Tampa, Fla., for his service as chairman of the board from 2011to 2013. Brancucci, who has served on CU Direct's board since 2004, will continue to serve in his new position as ex-officio on the board.

Also serving on CU Direct's board are:

  • Diana Dykstra, president/ CEO, California and Nevada Credit Union Leagues;
  • David Reynolds, CEO, Security Service FCU, San Antonio, Texas;
  • Barry Jolette, president/CEO, San Mateo CU, Redwood City, Calif.;
  • Sterling Nielsen, president/CEO, Mountain America CU, West Jordan, Utah; and
  • Donna Bland, president/CEO, Golden 1 CU, Sacramento, Calif.

CU System Briefs (05/24/2013)

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  • HIGHTSTOWN, N.J. (5/24/13)--The New Jersey Credit Union League went digital with its awards program last year and has decided to use the same format for 2013. Last year's digital program led to more entries than previous years, and allowed the league's member credit unions to choose the winners through an online voting platform, the league said. The league also has renamed its Volunteer of the Year Award in memory of the late credit union volunteer Calvin Jackson, who was the epitome of credit union volunteerism, the league said. Jackson always was willing to get involved with the New Jersey credit union system, and entries for the award should focus on this same quality in other credit union volunteers, NJCUL said (The Daily Exchange May 23) ...
  • LeCLAIRE, Iowa (5/24/13)--Paul N. Lensmeyer, president/CEO of Ascentra CU in Bettendorf, Iowa, since April 1993, died Sunday at University Hospitals in Iowa City. He was 62. At Ascentra, he set the culture of "listening, caring, doing what's right" and strived to make the credit union better for members, employees and the community. He served as a board member of Des Moines-based TMG Financial Services and Community Business Lenders Service Corp., and recently was awarded the Iowa Credit Union League's Cooperative Spirit Professional Award for outstanding service, commitment and leadership to the Iowa credit union movement.  He is survived by his wife, two children, four grandchildren, his mother, and a sister.  Funeral services are today at 10 a.m. CT, with visitation an hour before at St. Mark Lutheran Church, Davenport (The Quad-City Times May 22) ...

Coach Carter Among Keynoters At CUANY Convention

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ALBANY, N.Y. (5/24/13)--The Credit Union Association of New York's 2013 Annual Meeting and Convention will feature three keynote speakers, led by nationally renowned film inspiration Coach Ken Carter, June 13-16 at Lake George, N.Y.

Carter, an author, educator and the inspiration for the film "Coach Carter" featuring Samuel L. Jackson, will challenge attendees to reach beyond the average to true greatness during his presentation, "The Average Is Not Good Enough."

The gathering will feature two other keynote presenters, Mike Schenk, vice president of economics & statistics at the Credit Union National Association, and Dr. Lance Secretan, an award-winning leadership speaker, professor and author.

Schenk will share insights on how shifts created by the recent fiscal crisis will impact credit unions throughout 2013. Secretan will explore what makes a great leader, and how leaders inspire and change the world.

In 1999, basketball coach Carter made history at California's Richmond High School by locking his undefeated team out of the gym for failing to honor their player contracts and academic requirements. Within two years, he single-handedly transformed the school and the team, motivating his players to pursue excellence both on and off the court. His story inspired the nation and was immortalized in the popular 2005 film "Coach Carter."

Secretan is an advocate for the integration of corporate life and spiritual integrity. Secretan is the former CEO of a Fortune 100 company, a university professor, an award-winning columnist and author of 15 leadership books that emphasize the connection between high performance and the heart, mind and soul.

Celent: FI Branches To Decline 30%-40% In Decade

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BOSTON (5/24/13)--The number of branches built by credit unions and banks are expected to decrease between 30% and 40% in the next decade, according to Celent, a Boston-based financial services research and consulting firm.

Branch growth the past 40 years has exceeded population growth, said Celent's report, "Branch Boom Gone Bust: Predicting a Steep Decline in U.S. Branch Activity. "The U.S. retail banking branch network has yet to respond to the obvious migration of customers to new digital alternatives," said the report's abstract.

In 1970, there were 107 branches for every million individuals. By 2011, that had grown to 270 branches per million.

"There is every reason to suggest branch densities would be substantially lower now than 30 years ago, but just the opposite has occurred," said Bob Meara, senior analyst with Celent's Banking Group and co-author of the report. "Given this trend, a slow, but inexorable reduction in U.S. branch density seems unavoidable."

"Beyond simply reducing the number of operating branches, what is needed is a fundamental redesign of retail operating models. Rather than resisting the trend, banks should welcome it and reinvest the savings," Meara added.

Jim Holt, president of Wichita, Kan.-based, $197 million asset Mid American CU, said branches will remain an important part of how the credit union delivers its services and are expected by members.  In the past 20 years, the credit union has learned that members want every conceivable option to access the credit union they can get, including Internet and mobile banking, ATMs and branches, he told the Wichita Eagle (May 23).

Branches likely will change by becoming physically smaller but still must meet consumers' expectations and needs, he told the newspaper.

Mid American CU opened a full-service branch earlier this year and the board likely will be discussing the credit union's branch strategy, he told the publication.  It has two full-service branches in Wichita, a branch it jointly owns and operates with Cessna Employees CU in south Wichita, and a branch it acquired in Arkansas City.

Still, Celent indicates that  financial institutions must adapt to consumers' increasing use of online and mobile banking services.

"If banks don't align their multichannel strategies with this seismic shift in consumer preference, they'll be at a significant competitive disadvantage," said Stephen Greer, analyst with Celent's Banking Group and co-author of the report. "Financial institutions have their work cut out for them because transforming the branch network is neither cheap nor easy."

Thanks To CU Employees, 22 Lives Saved, Report Nation's Media

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MADISON, Wis. (5/24/13)--While a vault in the now-destroyed Moore, Okla., branch of Tinker FCU is getting credit for saving the lives of 22 people during Monday's tornado, the stories they brought out with them indicate heroic measures taken by credit union staff to keep the vault door closed and people inside safe.

National media, knowing a good miracle story when they hear one, began reporting on the survival of the 14 employees and eight members Wednesday. Reports of the group making it safely through the tornado appeared on CNN, NBC Nightly News With Brian Williams, ABC News, the Huffington Post, NPR and more. The story went around the world, with United Kingdom's Daily Mail picking it up with photos of the vault's occupants being helped out of the vault after the tornado.

Jan Davis, the branch manager, and employee Teresa Price described to CNN's Wolf Blitzer how they hid in the small vault as the building around them."  Blitzer asked if it were crowded. Davis didn't hesitate. "It was crowded," she said, "but if there had been more people we would have crowded them right in."

Price described the loud crashing sounds and feeling the walls taking the impact. "The vault was rocking, cracking," and "people were praying out loud."

Davis said staff tried to keep everyone calm with constant conversation and good feelings and positive statements.  When it was over, there was "devastation," said Price.  Davis added they knew there would be nothing left when they opened the door.

"I was one of the members in the vault yesterday," Dena Clarke wrote on the credit union's Facebook page. "You all should be so proud of your employees! Everyone, especially Jan the branch manager, acted so heroically to keep everyone safe. I am so thankful! Our family loves TFCU!"

ABC News reported that Clarke, 23, was in the middle of a transaction, when the tornado sirens went off and the teller told her they needed to go into the vault.

As the group crowded into the vault, Davis and a police officer monitored the situation by watching the TV and looking out the window. At least one passerby came into the credit union seeking shelter. The group included a 10 year-old-boy with an iPad and elderly members.

The power went off and they closed the door just before the tornado hit.

But there was a problem. They couldn't get the door closed all the way from the inside. Someone took off a belt and looped it through an opening meant to let in oxygen and they tugged the vault door closed as much as possible. The manager, the police officer, and another employee held the door shut "just in case."

As the tornado hit and they could hear what sounded like a freight train and felt immense pressure in their ears, things started hitting the vault, said Clarke, who said that Davis, hanging onto the door to prevent it from opening, yelled, "Don't let go. Don't let go."

Clarke said she doesn't know how they kept the vault door shut.  Debris began flying in the cracks of the door and glass cut the feet of people wearing sandals. It became difficult to breathe because of the dust and debris.

Then it was over. They tried to open the door, but debris was piled up against it.  Someone texted 911 to say they were trapped and could smell gas. Before authorities arrived, however, the group heard people passing by and shouted, and everyone was rescued.

Comments on the CNN site after the interview lauded the credit union's staff for "quick thinking," although Davis said they were following the disaster procedures. One commenter wrote, "Those credit union members really got their money's worth on their membership."

Comments on the ABC site included one from a tornado survivor in Missouri.  "I tried to seek shelter at a Bank of America in Missouri when tornado sirens were going off. The employees had locked the door and were carefully not looking outside" for security reasons.

For more information, check out the videos, photos, and news reports.

Filene Report: Are CUs Measuring Right Performance Indicators?

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MADISON, Wis. (5/24/13)--Key performance indicators (KPIs) such as return on assets, net promoter score and loan to assets, are used by credit unions because they are the easiest to measure, aggregate and compare, according to a new paper from the Filene Research Institute. However, they do not address credit unions' identity crisis--the need to form and describe a business model that is different from noncooperative financial institutions.

The report, "An Examination of Key Performance Indicators Reported by Credit Unions In North America," surveys the key performance indicator practices of 23 medium to large U.S. and Canadian credit unions.

Most credit union managers are so devoted to their established KPIs that they don't stop to imagine what metrics are right for measuring a credit union's values and its value to members, said the report's author Daphne Rixon, associate professor and executive director, Centre of Excellence in Accounting and Reporting for Cooperatives, Saint Mary's University, Novia Scotia, Canada.

"Even though credit unions measure these and other common financial indicators, something is missing from a cooperative that obsesses about financial metrics while ignoring other important points," Rixon wrote. "Credit unions have to consider strategy, regulation, their own users, and industry benchmarks. But what about community engagement and social responsibility? What about engaging stakeholders, not just shareholders? What about meaningful reporting to shareholders and stakeholders?"

She offered several suggestions:

  • Address the identity crisis. Credit unions live many of the seven cooperative principles, but sophisticated and unsophisticated credit unions alike struggle to measure and, equally important, report on activities that are fundamental to cooperative credit unions.
  • Develop appropriate benchmark data. With confusion about how best to make comparisons, credit unions are left with measuring and comparing only financial results. Rixon recommended creating national committees (in Canada and the U.S.) to investigate and sponsor no more than 10 KPIs and calculate methodologies for each. She also recommended a two-year pilot with anonymous reporting from a cross section of credit unions to gauge the effectiveness of the KPI system.
  • Encourage stakeholder engagement. Rixon encouraged credit unions to get beyond "tokenism" at annual general meetings and in board elections. Incentivizing member and employee groups (beyond the board) to actively participate in setting strategic priorities would lead to more authentic involvement.
  • Monitor the International Integrated Reporting Council (IIRC). IIRC is an international group that is already working on KPIs that would apply well to the varied priorities of credit unions, Rixon said. The IIRC's pilot project concludes in 2013; credit unions should note the results and consider adopting or modifying the suggested KPIs for their own use, she said.
To download the report, use the link.

Connecticut Gov. Proclaims Value Of Reality Fairs

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MERIDEN, Conn. (5/24/13)--
Barbara Bass, vice president of education and human resource development at the Credit Union League of Connecticut, accepts a proclamation by Connecticut Gov. Dannel P. Malloy praising Connecticut credit unions' Financial Reality Fair program from Fred Brown, director of marketing and member development of Northeast Family FCU. (Photo provided by the Credit Union League of Connecticut)
Connecticut Gov. Dannel P. Malloy has sent an official proclamation to the Credit Union League of Connecticut praising the value of its Financial Reality Fair program. The program is sponsored by Connecticut credit unions.

More than 100 credit unions and businesses have participated and/or donated their time, effort, and monetary contributions to make this program not only successful, but also essential to the future of participants in the local as well as national economy.

"What makes this program so worthwhile," said Bass, "is the fact that when money management skills are learned early on, good financial habits are instilled and carried forward for a lifetime of security and success."

Since Connecticut began conducting Reality Fairs, the idea has caught on in a number of states. The National Credit Union Foundation's REAL Solutions program champions programs such as reality fairs and has encouraged them. In February, NCUF hosted its Financial Reality Fair during the Credit Union National Association's Governmental Affairs Conference  in Washington, D.C. (News Now Feb. 12).

Leagues and credit unions throughout the nation have been active in the interactive financial literacy tool for high school students.

GoBankingRates.com Recognizes Five CUs For Tech Features

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EL SEGUNDO, Calif. (5/24/13)--Five credit unions that are offering popular technological banking features were featured in an article this month by gobankingrates.com.

"More and more credit union online banking features are surfacing from financial cooperatives across the nation, giving these institutions the competitive technological edge to rival household bank names," said the article, "5 Credit Unions with Incredible Banking Technology."

"The fact that these credit unions and many others in the credit union family are joining the wave of online and mobile banking is promising to loyal members who enjoy the non-profit touch, but desire innovative banking technology," added gobankingrates.com.

gobankingrates.com commended these credit unions for providing technology that consumers desire:

  • Wright-Patt CU in Fairborn, Ohio, offers a WPCU Home Banking app in which members can check multiple account balances and initiate transfers. The app garnered a 4.5 out of 5 rating on iTunes for its iPhone version from 97 consumer reviews. Wright-Patt's Android version received a 4.5 out of 5 review based on comments from 687 users.

  • USC CU in Los Angeles has a mobile deposit service available to iPhone, iPad and Android users, which is already designed into its mobile banking app. Users select which deposit accounts the funds should go to, state the amount being deposited, and snap two camera images--front and back--of the endorsed check.

  • TwinStar CU in Lacy, Wash., provides members peer-to-peer fund transfers to make borrowing money from friends easier. TwinStar allows members to send funds to a third party using its mobile app via PayPal. They can select the account from which to pull funds, enter the recipient's name and e-mail address (or mobile phone number), and choose the type of transfer the transaction classifies as--"friends and family" or commercial--then click send. There is a $1 fee per transaction.

  • Credit Union ONE in Ferndale, Mich., will soon release online banking features that present a helpful look for consumers, including brand logos for retail account transactions, online bill pay capabilities and budgeting tools that provides depositors a visual of their spending habits.

  • IC FCU in Fitchburg, Mass., uses text messaging to update members on their accounts. Its Short Message Service makes it easier to perform a quick account balance check. By using shortcodes like "B" for balance and "H" for transaction history, members can receive an instant response with the information they seek. The service is free, but standard messaging rates may apply.

Minnesota CU Network Elects Board

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ST. PAUL, Minn. (5/24/13)--The Minnesota Credit Union Network (MnCUN) announced the results of its board elections at its Annual Meeting and Convention May 17-18 in Bloomington, Minn.

Click to view larger image More than 300 credit union professionals and volunteers, and 134 service organization representatives, attended the Minnesota Credit Union Network Annual Meeting, May 17-18 in Bloomington, Minn. (Photo provided by Minnesota Credit Union Network)

Three incumbents and one new representative were elected to three-year terms on the MnCUN Board of Directors. The election results include:

  • Karen Fleming of HBI Employees CU, St. Paul, re-elected to the 2,000-or-fewer members seat;
  • Terri Maloney of Catholic United Financial CU, St. Paul, elected to the 2,001-to-10,000 members seat;
  • Kelly McDonough of First Alliance CU, Rochester, re-elected to the seat for credit unions outside the Twin Cities metro area;
  • Jeff Schwalen of Hiway FCU, St. Paul, re-elected to the seat for credit unions in the Twin Cities metro area;

The MnCUN Board also re-elected the table officers below for another term. They include:

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

More than 300 credit union professionals and volunteers, representing 70 credit unions attended the annual meeting. Its tradeshow hosted more than 134 people from 61 service organizations.

Mary Dunn, Credit Union National Association senior vice president and deputy counsel, gave the opening address during the Friday business meeting and led a session that provided regulatory updates and advocacy advice.

CUNA Board Chairman Pat Wesenberg also attended. She encouraged attendees to rally their credit unions and join in CUNA's Unite for Good initiative. "Working together, we can reduce burden and foster excellence throughout our industry," Wesenberg said. "[Unite for Good] is a rallying cry for credit unions to spread the message that credit unions are the best financial partner."

Wesenberg also met with The Crew, MnCUN's young credit union professionals networking group. The networking session, "Coffee with the CEOs," featured Wesenberg and Mark Cummins, MnCUN president/CEO; Mary Hansen, CEO/administrator of Mayo Employees FCU, Rochester; and Kyle Markland, president/CEO Affinity Plus FCU, St. Paul.

CUNA Closed Monday For Holiday, No News Now

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WASHINGTON and MADISON, Wis. (5/24/13)--The Washington, D.C, and Madison, Wis., offices of the Credit Union National Association will be closed Monday in observance of the Memorial Day holiday.

News Now will not post a Monday issue but will resume regular publication on Tuesday.

CU System Briefs (05/23/2013)

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  • ONTARIO, Calif. (5/23/13)--Stephen Barden, former credit union president/CEO, California Credit Union League employee and Western CUNA Management School  (WCMS) Board of Trustee chair, has died, said the California and Nevada Credit Union Leagues. Barden retired in 1998 after 16 years as the president/CEO of Beckman Employees CU--now Fullerton, Calif.-based Pacific Community CU. He was the 1980 recipient of the league's Leo H. Shapiro Lifetime Achievement Award.  Prior to that, he was manager of Los Angeles County Employees CU No. 11, now First City CU, which he joined in 1971.  He served as an education specialist at the league from 1961 to 1971. Barden also served two terms as league director, served on 10 league committees, chaired Western Corporate FCU's supervisory committee and helped create the Credit Union Deposit Network. He was involved with WCMS since its inception in 1962 and chaired its Board of Trustees from 1971 through 1997. Dr. James Likens, WCMS president, said a WCMS scholarship will likely be established in Barden's name.  Barden was the son of Lance Barden, who organized more than 400 credit unions, including the first credit union in Nevada, and the Hawaii Credit Union League. His daughter, Sue Longson, is vice president of business development and community relations in Irwin-based SCE FCU ...
  • HARAHAN, La. (5/23/13)--Beatrice "Bea"  Rosenblath, former president/CEO of Shreveport, La.-based St. John Berchman FCU (now Louisiana Catholic FCU) died Sunday after a battle with cancer. A life-long resident of Shreveport, she was 62.  Rosenblath began working in finance at the credit union in 1973 after obtaining her business administration degree. She was with the credit union for 35 years, during which the credit union grew to serve members locally and nationwide. She is survived by her husband, Fred J. Rosenblath; one son, Jordan F. Rosenblath; six sisters; and five brothers. A Mass will be Saturday at 10 a.m. at Holy Trinity Catholic Church, with a celebration of life service from 11:30 a.m. to 2 p.m. at the Scottish Rite Temple in Shreveport (Louisiana Credit Union League eNews and Shreveport Times May 22) ...

In Canada, CUs Outperform Banks On Small Biz Needs

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TORONTO (5/23/13)--Like credit unions in the U.S., Canadian credit unions continue to outperform banks in serving the financial needs of small and medium-sized enterprises, according to a Canadian Federation of Independent Business (CFIB) research report.

"Banks need to pay close attention to the report's findings if they are serious about serving the small business market," said CFIB Vice President of Research Doug Bruce. "Overall, credit unions do the best job of serving entrepreneurs, while Scotiabank and BMO are tied in receiving the highest overall scores among the big banks. CIBC is the worst big bank for small business--that's the same as it was in 2010, when we issued our previous banking report."

The report, CFIB's Battle of the Banks, provides bank scores based on nearly 13,000 survey responses from small business owners on four key issues: Financing, fees, experience with account managers and service.

Battle of the Banks shows a trend: The smaller the business, the lower the overall bank score. Compared with larger businesses, smaller firms have a tougher time getting the financing they need from their bank, the report indicates.

"Access to affordable financing and banking services is essential for hard-working entrepreneurs, and it's clear that all of the banks should do more to serve small-business clients," said CFIB President/CEO Dan Kelly.

CFIB is Canada's largest association of small and medium-sized businesses with 109,000 members nationwide.

In the U.S., credit unions continued to lend to small businesses in aftermath of the financial crisis, while banks largely withdrew from lending and stayed on the sidelines, News Now has noted. The Credit Union National Association is urging Congress to raise a cap on credit unions' member business lending to 27.5% of total assets from 12.25%. This would open up more opportunities for credit unions wanting to serve small businesses. Raising the cap would inject $13 billion in loans into the U.S. market and help create 140,000 jobs, CUNA said.

CUNA Mutual Group: Mortgages Should Reflect Flood Zone Requirements

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MADISON, Wis. (5/23/13)--With a wet U.S. spring causing the potential for flooding to increase, all credit unions need to make sure they know whether a property is in a flood zone before approving a mortgage, according to an article by Kriss Besch, CUNA Mutual Group product support manager.

"It's been the rule for decades," Besch wrote. "All lenders have to determine whether a property is in a flood zone before approving a mortgage. That lender also has to make sure that properties in flood zones are covered by insurance."

However, because of changing flood zones, "a mortgaged property that did not need flood insurance at the time of loan origination might need it five years later," Besch added. "It's up to lenders to keep track of map revisions and any other Federal Emergency Management Agency (FEMA) changes regarding exclusions or exceptions."

The Biggert-Waters Flood Insurance Report Act has increased its penalty to a minimum of $2,000 from $350 per flood violation, and lifted its annual $10,000 cap after several years of record flooding, catastrophic hurricanes and historic super storms.

"That means that a credit union that does not monitor flood zone revisions and require its members to have flood insurance could find itself in hot water--and with a big bill due to the government," Besch added.

Among additional tips for credit unions that Besch offers in the article on CUNA Mutual's website:

  • There are two types of flood zone certifications: Basic and life-of-loan. A basic certification is a one-time read of flood maps, which leaves the burden of monitoring changes up to the lender. For ongoing monitoring of any loan, the credit union would need a life-of-loan service. That service would track FEMA maps and notify the credit union of any flood zone certification changes. The responsibility and risk belongs to the flood vendor if mistakes are made. That means credit unions don't need to monitor FEMA maps on their own. With life-of-loan plans, the vendor does the tracking.
  • Credit unions must recognize that flood zone certification services are purchased per loan, not per portfolio. It is possible that credit unions have some mortgages that carry life-of-loan flood zone determination service and some that do not. They should verify annually what kind of coverage each mortgage carries to remain compliant with federal regulations.
  • Flood vendors should provide certificates for member files as proof to auditors that current determinations have been made. A credit union can be fined for not having a certificate even if the loan is monitored by a flood zone certification vendor and is adequately protected. Good flood vendors will also assist with FEMA Letter of Map Amendments for lenders.
  • It is never safe to assume that the flood zone status of a property cannot or will not change. As builders increasingly change the topography of construction sites by moving ground, flood zones can evolve--and sometimes much farther away than a credit union would suspect.

Okla. Foundation Deploys Tornado Relief Fund, Insurer Reports Damages

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OKLAHOMA CITY, Okla. (5/23/13)--The Oklahoma Credit Union Foundation Tuesday deployed its Tornado Disaster Relief Fund to assist credit union people impacted by tornadoes Sunday and Monday in Shawnee and Moore. And CUNA Mutual Group reported major damage to just one credit union.

Gary Jones, president/CEO of the Credit Union Association of Oklahoma, was en route Tuesday morning to Shawnee to meet with two credit unions affected by Sunday's tornado. He had already met with credit unions in Moore, which was hit by an EFL5 tornado Monday. "I've been talking with a lot of people who are hurting. The human stories are incredible," he said.

Those wishing to donate funds to assist credit unions in Oklahoma should make checks payable to the Oklahoma Credit Union Foundation, mark them designated for the Tornado Disaster Relief Fund and send to:

Credit Union Association of Oklahoma

631 E. Hill Street

Oklahoma City, OK 73105

For more information, contact Carrie Buchholz at 405-702-8622, ext. 215 or at carrie@cuaok.org.

"We have a lot of individuals who are credit union people who have loss of property and displacement of homes," Jones told News Now.  CUAOK reached out early Monday to two credit unions  headquartered in Shawnee--Bison FCU and Tri CountyFCU--as well as credit unions in Moore and Oklahoma City., including Tinker FCU, whose branch was destroyed. (See News Now story, Tinker FCU Branch Destroyed, Assisting Staff And Members).

"All feedback indicated there was not significant damage to credit union property and no loss of life, which was encouraging," Jones said. "We're resilient here and we truly have experience dealing with tornados."

CUNA Mutual Group reported to News Now Wednesday afternoon that its Property & Casualty Claims Disaster Team had been in contact with the league as well as all credit unions in Moore and the surrounding area. 

"In total, direct phone contact was made with 57 credit unions in the path of the large [Monday] tornado within 24 hours of the event," said Phil Tschudy, CUNA Mutual media relations manager. "This included credit unions in Oklahoma, Kansas, Missouri and Iowa."

"Although we received reports of minor building damage to various credit unions along the storm's path, which reportedly was a mile wide, the only credit union reporting any significant building damage is Tinker FCU's branch in Moore, which has been widely reported as a total loss," he said.

"Fortunately, all employees at this branch were unharmed. Our main focus has been on Tinker, and we have had adjusters onsite meeting with its staff and assessing damages. Other than the major loss at Tinker, we will likely see minor building damage and power outage losses for credit unions in the Moore area."

The National Credit Union Foundation, which runs CUAid, the national online disaster relief fundraising mechanism for credit unions, has been in touch with the Oklahoma league, which has, at this time, decided not to activate CUAid given the number of people affected.

"As an individual, the outpouring from around the country from colleagues and others in the credit union movement and from vendors, reporters, regulators and  business partners has been universally positive and caring, and  their response  is a comfort," Jones said, noting the collaboration that credit unions enjoy.

The tornado in Shawnee killed one person, while estimates of the death toll in Moore 24.

Century Heritage FCU Staffer Wins Council Primary

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HARRISBURG, Pa. (5/23/13)--Bob Macey, Allegheny County councilman and business development/community relations director for Century Heritage FCU, won the Democratic primary election against opponent Arlene Jabbour in Council District 9 in Pennsylvania  Tuesday, the Pennsylvania Credit Union Association said.

In the Nov. 5 general election, Macey will face Ken Peoples (R), who ran unopposed in the primary (Life is a Highway May 22).

Macey plans to retire from Century Heritage FCU, Pittsburgh, on June 28, but will stay in public service and involved in economic development and community relations.

Catalyst Corporate Appoints Supervisory Committee

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PLANO, Texas (5/23/13)--Catalyst Corporate FCU, Plano, Texas, named two new members to its Supervisory Committee. 

Jon Hernandez, president/CEO of CalCom FCU, Torrance, Calif., and Mattel FCU, El Segundo, Calif., was appointed to a two-year term.

Steven Devan, president/CEO of Grossmont FCU, El Cajon, Calif., was appointed a one-year term.

Herandez and Devan join three other committee members.

With more than 20 years of credit union experience, Hernandez is a member of the Credit Union National Association's Small Credit Union Committee, the California Credit Union League Board Executive Committee, and the CUNA Mutual Group select council, and is founder and chairman of the Southern California Credit Union Alliance.

Devan has more than 40 years of experience in credit unions and community banks in Southern California and has spent the past 10 years leading Grossmont Schools FCU.

Ohio CU Helps Kids Find a Way To Play

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SMITHVILLE, Ohio (5/23/13)--Wayne County Community FCU in Smithville, Ohio, stepped in to fill a need when parents were disappointed that their three- to five-year-old children didn't have an option for playing organized sports in the community.

Click to view larger imageWayne County Community FCU in Smithville, Ohio, helped 44 kids and their families by creating a soccer league. The credit union created a six-week series of soccer games when parents said that their three- to five-year-old children didn't have an option for playing organized sports in the community. (Photo provided by the Ohio Credit Union League) 

Chris Blough, CEO of the $45.1 million asset credit union, got the idea after overhearing the parent of a Piggy Bank Club member mention that there were several sports for older kids, but none for younger ones (eLumination Newsletter May 15).

Blough found a lack of options for smaller kids when he investigated the situation and created a plan for the credit union to remedy the void. Wayne County Community FCU's board of directors saw value in Blough's vision and how it could fulfill the need and positively impact the credit union's target market (25-45 year olds).

As a result, the credit union created a soccer league--for $600 and a few hours of work a week--that helped 44 kids and their families.

Wayne County Community FCU spread word of the six-week series of soccer games through flyers sent to the YMCA and local preschools and churches. The program also attracted special needs kids who participated in a group setting and developed friends and teammates.

At each game, "Coach" Blough made sure to mention that the program was made possible by Wayne County Community FCU.

"Parents were amazed that a credit union CEO was actually investing time and energy in their kids, not just writing a check," said Blough. "Parents are busy and will forget nearly any form of marketing we can throw at them, but they never forget the way you treat their children."

CU Service Network Elects New Board

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LAKEWOOD, Colo. (5/22/13)--CU Service Network (CUSN) elected a new board of directors at its 21st annual meeting May 14 in Denver.

With 21 member credit unions and 66 attendees present, the board election results were:

  • Carla Hedrick, incumbent, president/CEO at Denver Community CU, Denver, was re-elected for a three-year term.
  • Gerry Agnes, incumbent, president/CEO of Elevations CU, Boulder, Colo., was re-elected for a three-year term.
  • Scott McNeil, president/CEO of Foothills CU, Lakewood, Colo., was elected to a three-year term.
CU Service Network CEO Doug Burke presented innovations that took place during 2012, including new mapping tools, peer-to-peer convenience analysis, and a learning-management system. He also spoke about upcoming 2013 changes, including a new website.

CU System Briefs (05/22/2013)

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  • HARRISBURG, Pa. (5/22/13)--Michael Williams, representing the Erie Chapter Credit Unions was named the 2013 Credit Union Youth Ambassador of Pennsylvania. The Pennsylvania Credit Union Association has been holding the Credit Union Youth Ambassador Contest since the early 1970s to attract young people to credit unions and help prepare them for leadership roles. Contestants are judged on their ability to communicate their knowledge of the credit union system. Williams, who is now the director of business development for Widget Financial FCU, Erie, will spend the next year representing PCUA at several events. Rebekah Frischkorn, who received the first alternate award, is a marketing specialist at AmeriChoice FCU and represented the Harrisburg Chapter of Credit Unions. The second alternate award was won by Nicholas Jones, a member service representative at Service 1st FCU. He represented the N.W. Susquehanna Chapter of Credit Unions ...
  • FARMERS BRANCH, Texas (5/22/13)--Shared Resources CU, Pasadena, Texas, has been approved by the Texas Credit Union League to be a "Juntos Avanzamos" credit union.  TCUL President/CEO Dick Ensweiler presented the credit union with a Juntos Avanzamos flag to fly, as a symbol to the Hispanic community that the credit union has the capacity, commitment, and compassion to serve their financial needs.  To receive the designation, Shared Recourses CU had to pass the program by offering members bilingual services and information, affordable products and services that fit the needs of Hispanic families, and important financial information to empower Hispanic families. It is an honor to receive the Juntos Avanzamos certification from the league," said the Shared Resources CU President/CEO Stephanie Salazar. "We believe this is exactly in line with the vision of Shared Resources, which is 'being the best at making life changes'" (LoneStar Leaguer May 21) ...

NEW: Oklahoma CU Foundation Activates Tornado Disaster Relief Fund

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OKLAHOMA CITY, Okla. (FILED 5/22/13 at 11:50 a.m. CT)--The Oklahoma Credit Union Foundation has deployed its Tornado Disaster Relief Fund to assist credit union people with the impact of tornadoes that occurred Sunday and Monday in Shawnee and Moore.

Gary Jones, president/CEO of the Credit Union Association of Oklahoma, was en route to Shawnee to meet with two credit unions affected by Sunday's tornado. He had already met with credit unions in Moore, which was hit by an EFL5 tornado Monday. "I've been talking with a lot of people who are hurting. The human stories are incredible," he said.

Those wishing to donate funds to assist credit unions in Oklahoma should may checks payable to the Oklahoma Credit Union Foundation, mark them designated for the Tornado Disaster Relief Fund and send to:

Credit Union Association of Oklahoma

631 E. Hill Street

Oklahoma City, OK 73105

For more information, contact Carrie Buchholz at 405-702-8622, ext. 215 or at carrie @ cuaok.org.

"We have a lot of individuals who are credit union people who have loss of property and displacement of homes," Jones told News Now.  CUAOK reached out early Monday to two credit unions  headquartered in Shawnee--Bison FCU and Tri CountyFCU--as well as credit unions in Moore and Oklahoma City, including Tinker FCU, whose branch was destroyed. (See Related Story: Tinker FCU Branch Destroyed, Assisting Staff and Members)

"All feedback indicated there was not significant damage to credit union property and no loss of life, which was encouraging," Jones said. "We're resilient here and we truly have experience dealing with tornados."

The National Credit Union Foundation, which runs CUAid, the national online disaster relief fundraising mechanism for credit unions, has been in touch with the Oklahoma league, which has, at this time, decided not to activate CUAid given the number of people affected.

"As an individual, the outpouring from around the country from colleagues and others in the credit union movement and from vendors, reporters, regulators and  business partners has been universally positive and caring, and  their response  is a comfort," Jones said, noting the collaboration that credit unions enjoy.

The tornado in Shawnee killed one person, while estimates of the death toll in Moore 24.

Peters Backs MBLs: CUs Helped Auto Industry In Darkest Days

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U.S. Rep. Gary Peters (D-Mich.) speaks at the Michigan Credit Union League & Affiliates Annual Convention and Exposition. Peters told why he backs raising credit unions' business lending cap and thanked them for their efforts to provide affordable auto financing during the financial crisis.
DETROIT (5/22/13)--Credit unions should have the authority to make more loans to small businesses, said U.S. Rep. Gary Peters (D-Mich.), who noted credit unions' auto lending during the darkest days of the financial crisis, at the Michigan Credit Union League & Affiliates Annual Convention and exposition.

"Credit unions should be able to make those loans. We need to raise that cap," Peters said (Michigan Monitor May 21).

Peters is one of the original co-sponsors of this year's version of the bill that would raise the cap on member business lending.

U.S. Sen. Mark Udall's (D-Colo.) Small Business Lending Enhancement Act (S. 968), introduced in the Senate on Thursday, would increase the credit union member business lending cap to 27.5% of assets, from the current 12.25% (News Now May 17). Doing so would generate $13 billion in new loans and create 140,000 jobs, the Credit Union National Association said.

Peters thanked credit unions and the credit union industry for maintaining affordable financing for new-car purchases during the bleakest days for the auto industry in 2009, while banks stood on the sidelines.

Entrepreneur Josh Linker speaks about fostering creativity on the job at the Michigan Credit Union League & Affiliates Annual Convention and Exposition.  (Photos provided by the Michigan Credit Union League).

"The credit unions said, 'We will lend for cars,'" Peters said, speaking at MCUL & Affiliates Annual Convention and Exposition. "You stepped up when your country needed you and you made those loans"

Peters also thanked the Michigan credit union community for its endorsement of him for U.S. Senate.

In other events at the convention, entrepreneur Josh Linker encouraged credit union leaders to embrace new ideas rather than stifle creativity.

Fresh thinking should be encouraged, he said, even if it leads to mistakes. "Mistakes are not failure," Linkner said. "Mistakes are the portals to discovery."

Equifax: Student Debt Up 27%, Credit At 5-Year High

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ATLANTA (5/22/13)--Student loans increased nearly 27%, to $11.7 billion in February from $9.2 billion in February 2012, according to Equifax's most recent National Consumer Credit Trends Report.

That reaffirms the results of the Credit Union National Association's Student Borrowing Survey, which found that student debt is increasing, with half of high school seniors having no idea what college will cost or how debt works and indicating many lack basic financial knowledge. CUNA surveyed 846 teens age 17-18 last month.

"Student borrowing continues to increase rapidly, and well beyond just tuition increases as more and more people are attending colleges and professional training," said Equifax Chief Economist Amy Crews Cutts.

"In the past, some students might have relied on their parents who would have funded tuition payments using home equity lines of credit, but the small volume of home equity lending that is occurring today, at a little over $12 billion, is not sufficient to cover those costs."

Overall, new credit generated during January-February 2013 was $141 billion--the highest balance for that time period in five-years--and an increase of more than 33% over recession lows of $94 billion originated during January-February 2010.

New credit balance changes year-to-date in February 2013 versus February 2012 were:

  • Home equity lines of credit increased nearly 16%, to $12.4 billion from $10.7 billion; and
  • Auto loans rose more than 13%, to $69.6 billion from $61.5 billion.
"The rise in auto loans is reflecting the strong demand for new cars and light trucks, which increased almost 9% over the same time a year ago," Cutts said.

"On a year-to-date basis through February, auto loan origination activity this year is the strongest it has been for banks since Equifax began tracking this information in 2006, totaling $35.6 billion, and the second strongest showing for non-bank auto financing companies at $34 billion. Consumers are tired of their old, patched-up cars and demand is really starting to pick up.

"At the same time, there is a slight increase in the willingness of lenders to finance car purchases for consumers with less than perfect credit," she added.

Other highlights from the most recent data include:

Student Loans:

  • The total new credit balances for February, year-over-year 2012-2013, nearly 29%--to $5.1 billion from $4 billion.
Auto Loans:

  • The total number of new loans increased nearly 9%, from 3.2 million in February 2012, to 3.5 million in February 2013, the highest in more than seven years.
  • By source, bank-funded auto loans increased more than 12% from February 2012 to February 2013--to $17.4 billion from $15.4 billion, while auto finance company-funded loans increased less than 3%, to $17.9 billion from $17.4 billion. 
Home Equity Revolving:

  • The total number of new loans year-to-date in February 2013, are 130,200, a year-over-year increase of more than 11%.
  • Year-over-year, the total balance of new credit increased more than 11%, to $6.3 billion in February 2013 from $5.6 billion the year before.

Oklahoma League On Tornado: 'We're Prepared To Get Through This'

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OKLAHOMA CITY, Okla.  (5/22/13)--Three credit unions in Moore, Okla., saw different outcomes when Monday's EF5 tornado swept through with 200 mile-per-hour winds that leveled thousands of homes and businesses in an area as much as two miles wide and 17 miles long.

"The good news is there is no loss of life or injury to credit union staff and there is minimal property damage to credit unions," said Gary Jones, president/CEO of the Credit Union Association of Oklahoma.  "But a lot of people are hurting, and credit union employees are among them.

"There are some stories of near misses, and credit union employees have lost their home and property. We are responding to help," Jones told News Now.

At least 26 credit union employees in the Oklahoma City area may have been affected by severe damage or loss of homes and automobiles, according to tallies of two of the credit unions in Moore--Tinker FCU and  Oklahoma Educators CU.

Jones noted that staff and members at Tinker FCU's branch took shelter in the credit union's vault and survived the event while the tornado destroyed the branch around them. (See related story and photo:  Tinker FCU Branch Destroyed, Assisting Staff and Members.) The branch is closed indefinitely.

The tornado packed winds between 200 and 210 mph, making it in the strongest category of tornadoes measured under the Enhanced Fujita Scale assigned by the National Weather Service. It killed at least 24 people, including nine children, and injured more than 230 as of late Tuesday afternoon (CNN.com and USA TODAY May 21).

Oklahoma Educators CU President Cindy White was on her way Tuesday afternoon to assess any damage to the credit union's Moore branch, which was closed at the time the tornado hit.

"We know our facility is not leveled, not like Tinker FCU down the street, but we have not been allowed into the area yet," she told News Now. "Our employees there report that the building is still standing, and it is locked." One staffer's home was directly impacted by the tornado.

The third credit union with a branch in Moore, WEOKIE CU, said that branch and the Express Branch South were closed Tuesday due to power outages, Moore's Credit Union Service Center, a shared-branch, also was reportedly closed.

WEOKIE  said it will provide no-interest and no-payment loan options to assist members through the crisis. "The WEOKIE family is saddened by the loss of lives and destruction resulting from the May 20 tornadoes," said a message on its website. "We are grateful for the remarkable survival stories, including our colleagues at Tinker FCU," it said.

CUNA Mutual Group told News Now Tuesday that its Property and Casualty Claims Disaster Team had been in contact with CUAO and the credit unions in the Oklahoma City area. As of late Monday afternoon, the only credit union reporting damage was Tinker FCU's branch in Moore, said Phil Tschudy, CUNA Mutual media relations manager. "Fortunately, no one was injured there."

CUNA Mutual is "making arrangements to get adjusters to the area as soon as authorities allow. However, that may not happen until later today or early Wednesday," he said Tuesday. "Any policyholder credit union that has sustained damage should contact our disaster claims line at 800-637-2676," Tschudy said. "It is staffed 24/7."

The Oklahoma Credit Union Foundation is mobilizing to put in place the ability to respond to the needs of credit union. "Our foundation and board will be meeting this afternoon to go over a proposal on how to deploy assistance," Jones told News Now on Tuesday.

The Texas Credit Union Foundation said it is working directly with the Oklahoma foundation and is accepting online donations to the Oklahoma Tornado Relief Fund, as well as assisting Oklahoma in its disaster relief grant process (LoneStar Leaguer May 21).

"We have had incredible amounts of outreach from around the nation from credit unions who have told us they want to help. It is humbling," Jones said, adding CUAO has received a number of e-mails and phone calls.  "We are still evaluating what is needed."

"Please convey our incredible gratitude for all the prayers and offers of help," CUAO's Jones told News Now," he said. "We're prepared to get through this."

Tinker FCU Branch Destroyed, Assisting Staff And Members

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OKLAHOMA CITY, Okla. (5/22/13)--
Click to view larger image Only the safe deposit box vault of Tinker FCU's Moore, Okla., branch was left standing in the aftermath of an EF4-scale tornado that hit the area near Oklahoma City. Fourteen staffers and eight members were inside the vault and escaped with no injuries. (Photo provided by Tinker FCU)
For nearly two dozen staff and members of Tinker FCU's branch in Moore, Okla., Monday afternoon had its moment of reckoning. A half-mile wide tornado bore down on the branch and they took cover in the credit union's safe deposit box vault. After it was over, they were safe and sound, and the only thing left standing was the vault.

"The branch is destroyed," said Matthew Stratton, senior vice president of marketing at Tinker FCU. "But the staff and members were safe inside the safe deposit box vault." He noted that 14 employees and eight to 10 members had sought shelter in the vault, "and everyone survived, with no injuries."

After the tornado ended, the building's debris blocked the vault door from opening, but first responders--who arrived within minutes--helped the employees and members get out. Because new storms were on the way, the group took cover a second time in a basement across the street until family members arrived, Stratton said.

The credit union had someone stay on site to keep the credit union's vault secure until 10 p.m. Monday, when the cash in the vault was removed and the safe deposit boxes were secured.

A second branch, the Northeast Oklahoma City branch, is also closed until power can be restored.

Tinker FCU's human resources department is now gathering information for assisting employees directly impacted by the tornado.

"All staff  have been accounted for, and they're OK," Stratton said. However, about 25 employees have some damage to their homes, and four employees' homes were destroyed.

"We've set up an account for donations and financial assistance, but have not yet set up a mechanism for donating property or things," Stratton said. The TFCU Employee Relief Fund, account No. 8599883, is set up to receive funds mailed to:

Tinker FCU

P.O. Box 45750

Tinker Air Force Base, OK 73145-0750

He noted that the Oklahoma Credit Union Foundation is also developing assistance for credit union employees and the American Red Cross is already on the scene.

"We've secured the safe deposit box vault and the branch's computer system is secure," Stratton said. "The branch's system doesn't hold any information. Its computers are more a connection conduit into the core system, which is located elsewhere. Members don't have to worry about their confidential information being housed in a damaged computer."

In addition to securing the cash and vault, ensuring employees are well, Tinker FCU is also offering members a disaster relief loan program. However, he noted that the credit union typically works one-on-one with members through any crisis. "This is just a bigger version."

(See related stories in today's News Now, "Oklahoma League On Tornado: 'We're Prepared To Get Through This,'" and "NCUA Activates Disaster Relief For Oklahoma.")

PCUA Names Desjardins, Maxwell, Herring Award Recipients

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HARRISBURG, Pa. (5/22/13)--The Pennsylvania Credit Union Association  announced winners of its Desjardins, Maxwell and Herring awards May 16-18 at its 79th annual convention in Hershey. 

The Desjardins Financial Education Awards recognize the financial literacy efforts of credit unions in educating youth. The Youth Financial Education first-place award-winners were:

  • HealthCare First CU, Johnstown--$50 million to $150 million in assets;
  • Service 1st FCU, Danville--$150 million to $500 million; and
  • TruMark Financial CU, Trevose--more than $500 million.
The Dora Maxwell Awards for Social Responsibility Award signifies a commitment to volunteering time, energy, and resources to boost the living standards of others. First-place awards were presented to:

  • Keystone United Methodist FCU, Cranberry Township--$5 million to $20 million in assets;
  • HealthCare First CU--$50 million to $100 million;
  • Tri County Area FCU, Pottstown--$100 million to $200 million;
  • Merck Sharp & Dohme FCU, Chalfont--$200 million to $500 million;
  • TruMark Financial CU--more than $1 billion: and
  • York Chapter of Credit Unions--Chapter/Multiple Credit Unions.
 

The Louise Herring Awards for Philosophy in Action Award display how credit unions put People Helping People credit union philosophy into action. First-place awards were presented to:

  • First Capital FCU, York--$50 million to $250 million in assets; and
  • TruMark Financial CU--$100 million to $200 million.
 

CUAD Grants Available For Fin. Lit. Efforts

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BISMARCK, N.D. (5/22/13)--Grants are available to community organizations and credit unions affiliated with the Credit Union Association of the Dakotas through the Credit Union Foundation of the Dakotas.

CUAD is funded by participating North and South Dakota credit unions. It funds projects in the areas of access to financial services, financial education, savings and asset accumulation, and small-credit union development.

Applicants must be an affiliated North and South Dakota credit union or a community organization. Non-credit union organizations may apply for grant funding, but must partner with a North or South Dakota credit union and demonstrate how the project will impact credit unions and their members.

Funds may be used for:

  • Education of credit union employees and volunteers;
  • Public education initiatives related to consumer finance;
  • Projects and programs that support new, small or community development credit unions:
  • Enhancement to league/association projects funded by other sources consistent with the foundation's mission and purposes
  • Programs or projects that extend credit union services to the full range of membership, with emphasis on the un-served, underserved or low-income consumers;
  • Affordable housing projects;
  • Disaster relief;
  • Partnerships that provide services or carry out projects consistent with the Foundation's mission and purposes; and
  • Other purposes consistent with the foundation's 501(c) (3) mission and purpose.
Applicants also must:

  • Solicit endorsement and/or funding from at least one local credit union or credit union-related supporter;
  • Be able to leverage funds from other community, philanthropic, government or other sources to maximize benefit and ensure sustainability after the grant's funding ends;
  • Obtain letters confirming in-kind support or funding commitments from partners both within and outside the credit union movement; and
  • Have tangible, achievable goals and objectives.
For a list of what applications should include, use the link.

Applications are due by June 21.

Ponzi Scheme Claims Process Made Available Until Sept. 5

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MADISON, Wis. (5/22/13)--A federal court in North Carolina has approved and implemented the claims process related to the Rex Venture/Zeek Rewards Ponzi Scheme, which victimized credit union members and involved at least $19.8 million in losses to credit unions.

As of May 15th, individuals may file a claim using the online claim form  provided at the Zeek Rewards Receivership website. To access, use the link. The claims process will be available until Sept. 5, according to a May 8 decision in the U.S. District Court for the Western District of North Carolina.

The Credit Union National Association was instrumental in providing advance notice to credit unions of the scheme. CUNA participated in BITS Fraud Steering Committee ad hoc calls related to the scheme. On August 12, 2012, the Securities and Exchange Commission had shut down the North Carolina-based Rex Venture Group, which did business as  Zeek Rewards and as penny auction site Zeekler.com.

Credit unions can share the information with members who were impacted by the scheme and appropriate individuals within the credit union to help answer any questions members may have, said Julie Esser, director of new alliances, CUNA Strategic Services, who is one of CUNA's staff liaisons with BITS.

In its complaint filed, SEC had said the $600 million Ponzi scheme, which was then on the verge of collapse, attracted  more than one million online customers, including many credit union members, who were promised 50% of the company's daily net profits through a profit sharing system that involved accumulating rewards points redeemable for cash payouts (News Now Oct. 26, 2012).

SEC's complaint said that 98% of Zeek Rewards' total revenues and  "net profits" paid to current investors was comprised of funds from new investors.  Other activity involved money orders, cashier's checks, debit and credit cards and automated clearinghouse transactions, with check amounts ranging from $10 to $10,000.

In October of 2012, CUNA said more than 8,200 checks, totaling $19.8 million, were issued by about 1,150 credit unions affected by the scheme. CUNA notified credit unions with valid e-mail addresses and whose members had been affected by the scheme, and notified CUNA Mutual Group, which issued three Risk Alerts to policyholders.

For more information use the links.

Morrow Named 2013 CU Hero Of The Year

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MADISON, Wis. (5/22/13)--Credit Union Magazine readers have posthumously named Warren Morrow, the late founder of the Hispanic market solutions company Coopera, as the 2013 Credit Union Hero of the Year.

Morrow founded Coopera with the belief that Hispanics need credit unions as much as credit unions need Hispanics.

He died Feb. 15, 2012, at the age of 34. His wife, Christina Fernandez-Morrow, will accept the award on his behalf during the America's Credit Union Conference in New York City June 30 to July 3.

Morrow believed deeply in helping underserved Hispanics receive dignified financial services, said Coopera CEO Miriam De Dios.

"By bringing financial stability to a home, Warren believed, you could begin to address other social issues," De Dios said. "Warren envisioned a credit union movement that rallied around serving the underserved Latino community. He would often say, 'Hispanics need credit unions, as much as credit unions need Hispanics.'"

"Warren had a powerful vision that outreach to the underserved Hispanic community should not be philanthropy," added Murray Williams, chief operating officer for the Iowa Credit Union League. "Instead, a business could do well by doing good--and everyone would benefit."

Coopera is owned by Affiliates Management Co., the holding company of the league.

Credit Union Magazine readers also lauded these leaders as credit union heroes:

  • Lily Newfarmer, CEO Tarrant County CU, Fort Worth, Texas;
  • Anabela Pereira, CEO Pioneer Valley FCU, Springfield, Mass.; and
  • Scott Prior, president/CEO Connection CU, in Silverdale, Wash.
Voting took place on creditunionmagazine.com through May 17.

CU To Hold Vigil For Missing Employee

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MILWAUKEE, Wis. (05/21/13)--A vigil has been planned for Wednesday by Milwaukee, Wis.-based Educators CU for an employee who has been missing since May 9.

Jessica Benson, 22, has not been heard from since calling in sick on May 11 and hasn't been seen since May 9. Benson was an employee of the credit union for six years and was to graduate from Mount Mary College last Friday with a degree in chemistry and a certificate in peace building (WITI.com May 19).

A robbery was reported at the credit union on May 7 while Benson was working but there is no indication that the two events are related (Milwaukee Journal-Sentinel May 20).  Benson is of mixed race and stands about five-foot, four inches tall with long black hair, brown eyes and usually wears glasses with black frames.

The vigil is set for 6 p.m. CT Wednesday at the credit union.

CU System Briefs (05/21/2013)

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  • WAUKEGAN, Ill. (5/21/13)--Consumers CU in Waukegan, Ill. is teaching students financial literacy by implementing a new reward programs. Its Student Choice Checking account has a $310 daily limit, mobile banking, online banking, free electronic statements and the option to open a Student Visa credit card. It is available to members, ages 13-21. Parents or legal guardians are required to be joint-owners, which will encourage them to work closely with their children, said the credit union.  Anyone opening a Student Choice Checking account before June 30 will be entered in a random drawing to win a $50 iTunes gift certificate. "Helping students understand the value of financial literacy by managing their own money and other resources is vitally important," said Sean M. Rathjen, CCU president. "Our iTunes promotion provides a way to encourage them to take an interest in securing their financial future. The program promotes sound decision making and responsible money management while encouraging the students to take charge of their lives as they budget their own finances, manage their own line of credit and learn other fundamentals that will better prepare them for the future." ...
  • WEST JORDAN, Utah (5/21/13)--The MyExpress Debit card is the newest addition to Mountain America CU's options for members to deposit and spend only what they need. The new type of debit card has the benefits of a prepaid card without paying monthly maintenance, deposit or other fees. "The MyExpress Debit card is a great low-cost way to pay children's allowance and teach them how to handle their money," said Dennis Bromley, senior vice president of member development and engagement for the West Jordan, Utah-based Mountain America. "Or members can use it as a travel card or for online purchases, minimizing risk if the card or number is lost or stolen. MyExpress was designed to be extremely versatile, giving our members another tool to help them and their families wisely and safely manage their money." MyExpress Debit has no activation, maintenance, deposit or overdraft fees and allows members to add funds at any time ...
  • CEDAR FALLS, Iowa (5/21/13)--Officers that have been elected to the Black Hawk Chapter of Credit Unions in Cedar Falls, Iowa, are: president, Helen Pearce, president/CEO of Cedar Falls (Iowa) Community CU; vice president, Nathan Tobey, business relationship officer with Veridian CU, Waterloo; treasurer, Gary Shontz, who has been Cedar Falls-based UNI CU board chairman since 1983; and secretary, Lindsey Smedley, business relationship officer with Veridian CU (Cedar Valley Business Monthly Online May 19)  ...

Elevations CU Attracts YouTube Hits With Random Acts Of Kindness

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BOULDER, Colo. (5/21/13)--Elevations CU has used the Random Acts of Kindness concept to generate a high volume of hits on YouTube.

While Random Acts of Kindness have gained popularity as a way to earn word-of-mouth publicity, Elevations CU collaborated with local businesses and nonprofits to create more online buzz.

Elevations recently commandeered a food truck from Comida, a mobile Mexican food business, and handed out free lunches throughout Longmont, Colo. The event helped spread goodwill among the Longmont community and raised money for the OUR Center, a local food pantry and shelter.

"All of the sudden you have several groups coming together that are very likely to [promote the event] to their constituents," said Dennis Paul, Elevations CU assistant vice president of business and community development. "You have a system where a number of folks are channeling this out."

The collaboration with local businesses and groups has engaged YouTube viewers. A YouTube video of the Comida lunch giveaway has attracted more than 13,000 views.

On Valentine's Day, the credit union bought gifts and flowers on behalf of shoppers, and later bought dinner for couples. Videos of the presentations attracted more than 39,000 and 67,000 views, respectively.

Elevations CU has similarly engaged its members on Facebook. In 2012, the credit union offered $1 donations to its foundation in exchange for Facebook 'likes." Currently, Elevations has more than 9,000 Facebook likes.

Iowa League Launches Pledge Campaign For Member Awareness

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DES MOINES, Iowa (5/21/13)--The Iowa Credit Union League has launched the Iowa Credit Union Pledge to encourage credit union members to show their support for their credit union.

The Pledge is part of an ongoing effort to educate credit union members about the value of membership and important legislative issues affecting their financial futures, said the league.

The Pledge says:

"I pledge to take pride in the people and places that make my community special.

"I pledge to use my voice to promote organizations that are committed to the long-term success of my community.

"I pledge to shop at local businesses that know me and value me as a customer and a neighbor.

"I pledge to invest in my financial future by supporting my credit union, an organization that respects me as a person, not as a number.

"I am proud to be a credit union member."

"Iowa's credit union members take pride in the people and places that make their communities special, and their local credit unions play an important role in this," said Emily Caropreso, league director of communications and marketing.

"The Pledge is a way for Iowa's one million members to show support for the local investment their credit union makes," she added.

Raising awareness is one of three goals in the Credit Union National Association's and state leagues'  Unite For Good campaign aimed at reaching the strategic vision in which "Americans choose credit unions as their best financial partner." For more information on the Unite For Good campaign, use the link.

ACUC Speaker's Message To Be: Take Bold Action During Duress

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MADISON, Wis. (5/21/13)--Attendees of the Credit Union National Association's America's Credit Union Conference in New York City will learn the secrets of taking bold action in times of duress from Lt. Col. Robert Darling, who served in the Gulf War as a decorated U.S. Marines combat helicopter pilot and was a key adviser to the Bush administration following the Sept. 11, 2001 attacks.

Credit Union Magazine senior editor Adam Mertz interviewed Darling in advance of his opening keynote address at ACUC, June 30. ACUC will be held June 30-July 3.

On Sept. 11, 2001, Darling had a front-row seat on history, standing side-by-side with President George W. Bush, Vice President Dick Cheney, then-National Security Advisor Condoleeza Rice, and other high-ranking government officials as they responded to the deadliest terrorist attack on American soil.

The author of "24 Hours Inside the President's Bunker" says he's "on a mission" to spread the word about the events he witnessed on Sept. 11.

In the interview Darling describes how leaders must combine decisive action with humility, allowing "people in the field" to be the difference makers.

"You're going to go to your most junior [employees] sometimes and you've got to have faith, trust and confidence in their abilities," Darling says. "You have to surrender control and follow what they're advising you to do because they know more about that potential crisis than maybe you do, and how to mitigate it or end it."

Darling will share the lessons he learned in a framework credit union leaders can apply to their operations, and underscore the importance of providing a firm financial foundation for members who are first responders and military personnel.

"In the credit union movement, we've got to give their families financial literacy," he said. "We've got to be able to offer programs where they feel they can get mortgages and buy cars and get those things they need so they can deploy away from their families and protect all of us."

PCUA Elects Board Officers, Presents Awards

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HARRISBURG, Pa. (5/21/13)--The Pennsylvania Credit Union Association elected its board of directors officers and presented its professional and volunteer of the year awards last week at its annual meeting.

Maria LaVelle, CEO of Westmoreland Community FCU, Greensburg, Pa., was elected board chair, succeeding Michael Kaczenski, and Louise Lingenfelser, CEO of ClearChoice FCU, Wyomissing, was elected vice chair (Life is a Highway May 20).

The board also approved two new appointees to the board of directors of the Pennsylvania Credit Union Foundation:  Amy Lichwa, CEO, Norwin Teachers FCU,  Irwin, and Jeff Albert, CEO, People First FCU, Allentown.  They replace outgoing members LaVelle and Edwin Williams, CEO, Discovery FCU,  Wyomissing, who vacated his seat to assume a position on the National Credit Union Foundation Board.

PCUA also presented lifetime achievement awards to Dave Ackerman, CEO of USX FCU, Cranberry Township, who received the 2013 William W. Pratt Professional of the Year Award, and Dr. Ross McFarland, treasurer of Tri County Area FCU, Pottstown, recipient of the 2013 Joseph A. Moore Volunteer of the Year Award.

Texas League Wins Removal Of Tax Status Review Amendment

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FARMERS BRANCH, Texas (5/21/13)--A revised version of Texas House Bill 500 provides nearly $1 billion in tax relief for Texas businesses, but has no provisions that are harmful to credit unions after the Texas Credit Union League lobbied a Senate subcommittee to remove amendments from the bill.

HB 500 was recently amended on the House floor to require a periodic review of state tax exemptions, the Texas Credit Union League said Friday (The Advocate May 17). Under the amendment, the state franchise tax exemption would have been subject to ongoing review. After additional amendments were added to the bill, it was sent to the Senate.

As soon as that legislative action occurred, the league began lobbying members of the Senate to gain their support for removal of the provision. A Senate subcommittee removed all amendments from the bill Thursday. In its revised form, the bill now provides tax relief for Texas businesses, but protects credit unions and other entities with the exemption.

However, it's still possible for lawmakers to amend the bill on the state Senate floor and the league will remain on guard, said Jim Phelps, political and grassroots director for the league.

The Dallas Morning News Thursday reported that Texas Attorney General Greg Abbott told Republican House members that a special session to address redistricting could be called after the regular session ends May 28.

The Credit Union National Association and state leagues earlier this month launched a large-scale grassroots effort which seeks to mobilize America's 96 million credit union members and deliver to Congress a direct, united message: "Don't tax my credit union!" Tomorrow at 3 p.m. ET, CUNA is conducting a free webinar on the new campaign. To register for the webinar, use the link.

NYIB Conference Sets Agenda

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CENTENNIAL, Colo. (5/21/13)--The National Youth Involvement Board's Annual Conference will be held July 29 to Aug. 1 in San Diego, celebrating the theme, "It's Electric."

Among the keynote speakers at the conference are:

  • Tim McAlpine, president and creative director, Currency Marketing, who will discuss what young potential members really look for from their financial institution, including which products, services and technology the credit union needs to remain relevant.
  • Troy Hall, chief operations officer, South Carolina FCU, North Charleston, S.C., who will address the impacts of generational-marketing knowledge and strategies.
  • Darrin Cates, president/CEO, eVibrant, who will provide examples of online marketing strategies.
  • Ryan Zilker, B2B marketing manager, CO-OP Financial Services, who will discuss the latest mobile and virtual banking technologies that credit unions can offer their members and where those technologies intersect the wants and needs of young people.
During the conference, the NYIB also will recognize its Outstanding Voting Delegate of the Year and Outstanding Volunteer of the Year.

The NYIB offers scholarships to the conference. For information, use the link.

Federation Conference Early Bird Registrations Due Today

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NEW YORK (5/21/13)--Today is the deadline for early bird hotel reservation for the National Federation of Community Development Credit Unions' 2013 Annual Conference: Financial Inclusion Through Cooperative Finance.

The conference for community development credit unions (CDCUs) will be in Baltimore, Md., June 5-8 at the Sheraton Inner Harbor Hotel. Affinity workshops and a visit to Municipal Employees CU will be on the agenda for June 5.

Baltimore Raven Offensive Tackle Michael Oher, inspiration for the Academy Award-winning movie,The Blind Side, will make a special guest appearance on June 6.

That day also will feature a breakfast open plenary on Innovations and New Directions in Financial Services and a lunch plenary on Economic Outlook: How CDCUs Can Prosper in a Rapidly Changing World, as well as morning and afternoon workshop sessions.

In addition to morning and afternoon workshops on June 7, the day will feature Baltimore Mayor Stephanie Rawlings-Blake as well as the Annie Vamper "Helping Hands" Awards Luncheon honoring Harriet B. May, former president/CEO of GECU, El Paso, Texas, and former Credit Union National Association chairman.

Events on June 8 include a member business meeting and the closing plenary on Consumer Financial Protection Bureau and the Impact on Credit Unions.

For more information, use the link.

Unite For Good: National Media Wake Up To CUs' Positive Power

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WASHINGTON (5/21/13)--

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As credit unions Unite for Good to get the good word out about the value of credit unions, the Credit Union National Association has succeeded in nabbing credit unions their share of the spotlight among nationwide media the past few weeks.

Since April 1, more than 14 of the nation's most prominent media outlets have featured CUNA and credit unions on topics ranging from student lending, the value of the credit union alternative, member business lending, financing automobiles, CUNA's regulatory agenda and more.  That doesn't count the background provided and interviews for upcoming media stories to be released soon or articles generated locally by credit unions and leagues..

"Some believe if the story is not in their local area, it's not important. But it certainly is," said Paul Gentile, CUNA executive vice president of strategic communications and engagement.

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"Often the local media play off what they see in the national press, so we always want to be sure we shine and are portraying credit unions as the excellent consumer choice that they are," Gentile said.

In May, CUNA and aSmarterChoice.org, the website that provides consumers with information about credit unions and helps them find one to join, were included in these articles, all centering on credit union student lending and CUNA's Student Borrowing Survey:

  • The Wall Street Journal Sunday (May 19);
  • The Wall Street Journal (May 11)'s Weekend Investor section;
  • USA TODAY's Money section "Snapshot" (May 10);
  • CNBC.com (May 4); and
  • NBC Charlotte/WCNC.com (May 1).

In April, nine prominent media displayed credit unions' value, including:

  • MSNBC "Your Business" TV (April 7), in a segment with Gentile on the credit union alternative;
  • Reuters (April 12), with CUNA Deputy General Counsel Mary Dunn addressing credit loss reporting standards;
  • U.S. News & World Report (April 22), with CUNA Senior Economist Mike Schenk discussing credit union financing for auto loans;
  • The Huffington Post (April 23), featuring CUNA's Student Borrowing Survey;
  • Fox Business News Online (April 23), featuring Gentile on credit unions' member business lending;
  • Loans.org (April 23), with Schenk discussing auto loan activity;
  • The Hill (April 24) ,  in which CUNA's President/CEO Bill Cheney, Executive Vice President of Governmental Affairs John Magill and Dunn discuss too-big-to-fail banks and CUNA's regulatory agenda;
  • National Association of Student Financial Aid Administrators (April 24), with Gentile discussing CUNA's Student Borrowing Survey; and
  • Accounting Web (April 25), CUNA's Student Borrowing Survey.

In March, articles were also featured in CNN.com (March 18); Bloomberg BusinessWeek (March 12); Compliance Week  (March 26) Accounting Today (March 19).

The initiatives of CUNA and the state leagues on credit union issues have also been mentioned in numerous regional, state or local articles and broadcast segments and podcasts that have been generated by leagues and credit unions locally.

Creating awareness about credit unions is part of CUNA's Unite for Good campaign to rally credit unions to support the system's strategic vision in which "Americans choose credit unions as their best financial partner.  For more information about United for Good and aSmarterChoice.org, use the links.

UNO FCU's Revamped Facebook Page Draws a Crowd

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NEW ORLEANS (5/20/13)--University of New Orleans FCU (UNO FCU) recently transformed its Facebook page to engage members rather than using it to post promotions and interest rates.

The page, created in 2009, focused primarily on announcing on-campus visits and educational programs or, posting pictures of past events. The feedback from members was positive. During the next three years, the page grew to more than 600 "likes." However, fans were not engaged with the page, said Christopher Maurer, UNO FCU president/CEO.

In late 2012, UNO FCU began the process of revitalizing the page by measuring its readership results. Each post was monitored to determine how many fans viewed it, if it engaged fans, when it was viewed, and if it earned positive or negative feedback.

"We had the best results with giveaways and sponsored advertising on Facebook" said Maurer.

A drawing for tickets to the New Orleans Jazz and Heritage Festival attracted 234,876 views and 865 likes, Maurer said. The credit union also posted more light-hearted content as opposed to only financial information, thus engaging visitors with local events and news.

UNO FCU has invested about $100 in Facebook advertising, Maurer said.

In two months, UNO FCU's fan base increased to 1,156 fans from 630. Fans are "liking," posting, and sharing daily. UNO FCU's posts are more external, highlighting online trends, university events, and New Orleans happenings, all creating a component of community involvement.

UNO FCU plans to continue this strategy with hopes to intensify awareness on campus and assist more University of New Orleans students in advancing their financial future.

"The elements that aren't advertising attract the most views," Maurer said. "By adding that human element rather than appearing as a machine that spits out advertising, we remain relevant to our audience. At the same time, we put out information that affects our members, such as financial information or school events. We promote campus organizations. No matter where you live or work, I think it's important to post things that are relevant to the group."

CU System Briefs (05/20/2013)

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  • WILKES-BARRE, Pa. (5/20/13)--An employee at Choice One Community FCU was charged with stealing roughly $50,000 in bonus point awards from member accounts. Officials became aware of the thefts after three members complained that bonus points to which they were entitled were not available. The Wilkes-Barre, Pa.-based credit union offered a points program to encourage members to use their debit cards. After accumulating a certain amount of points they would win a gift certificate. Donald G. Pientka, 49, Hanover Township, was an electronic services specialist at the credit union and allegedly had access to the account. He was charged with felony counts of receiving stolen property, theft  by unlawful taking, theft  by deception, using an unauthorized access device and identity theft. The credit union replaced the awards for members, and no members' personal or account information was compromised (Standard-Speaker May 12) ...
  • PLEASANT GARDEN, N.C.  (5/20/13)--A retired manager from the Greensboro (N.C.) Postal CU died Monday at her residence in Pleasant Garden,  N.C.  Evelyn Butler Arnold, 74, had given the Greensboro Postal CU 32 years of service. She was a member of the South Elm Street Baptist Church and the Order of the Eastern Star. Above all else Arnold enjoyed traveling and spending time with her family. She is survived by her husband, two daughters, one brother, three sisters, and five grandchildren. Funeral services were held Friday (Greensboro News & Record May 16 ...

Study: CUs, Community Banks Overpay For Core Services

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PALO ALTO, Calif. (5/20/13)--Credit unions and community banks aren't doing themselves any favors in negotiating information technology (IT) service provider contracts, according to a survey of executives about their top business concerns and management priorities.

Instead, community financial institutions are overpaying for one of their largest categories of non-interest expense--outsourced core processing and IT services, said "Less Burn, More Return," a report by the Business Performance Innovation (BPI) Network and Paladin fs.

The top priorities for the next 12 months of the credit union and community bank executives surveyed include increasing the size of their loan portfolios and cutting non-interest expenses.

Other key findings:

  • The top business concern of credit unions and community banks are tight net interest margins, 79%; increased government regulation, 72%; sluggish economic growth, 54%; and greater competition from larger institutions, 33%.
  • The top management priorities for the next year include growing loan portfolios, 82%; reducing non-interest expense, 63%; management new regulatory requirements, 50%;  increasing net interest margins, 37%; and adding new technologies and bank processes, 34%.
  • Community financial institutions continue to add new customer-facing technologies and processes, with 90% saying they added new technologies and service in the past three years, and 74% planning to add more services in the next three years.
By restructuring their provider contracts using national pricing data, the executives can reduce costs by as much as 43%, the report said. Those surveyed with financial institutions from $500 million to $1 billion in assets saved an average of about $1 million over a five-year period when they restructured existing contracts based on national pricing data.

"The secret to restructuring a contract with an incumbent vendor is having the right pricing data in advance of negotiations, getting started well before the current contract expires, and negotiating a win-win agreement with the vendor," said Aaron Silva, president/CEO of Paladin fs, which worked with the BPI Network on the study.

"Many community banks and credit unions feel they are playing catch-up with larger institutions when it comes to technology-enabled services for customers. Mobile banking is an area of particular interest," said Silva, adding that contract restructuring can play a significant role. "By restructuring existing core processing and IT service costs, community financial institutions can effectively pay for these new service offerings."

Georgia Trend Highlights CUs' Growth, Stability

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DULUTH, Ga. (5/20/13)--Georgia credit unions' stability and growth in 2013 following a  five-year recession were highlighted in a feature article and sidebar in the May issue of Georgia Trend magazine.

"We have really weathered the storms well," Doug Foote, president/CEO of Georgia United CU in Duluth, Ga. told Georgia Trend. "It wasn't easy to do, but we came out the other end and still are as financially strong as we were going into it."

The credit union nearly quadrupled in size during the past 10 years--to $940 million in assets from $250 million, Foote added. Also, Georgia United saw an increase in new-auto loans of 15.4% in 2012 from 2011, and a 7.9% rise in used-vehicle loans during the same period.

"I'd say it's more the norm than an exceptional example," Mike Mercer, president/CEO of Georgia Credit Union Affiliates, told the publication. "People want to get safe with their money, and they view credit unions as safe. In the dot-com bubble and the real estate bubble eras, credit unions weren't looked at as all that cool. But when times get tough, people bring their money to credit unions, and a lot of this money is going into savings accounts." 

Mercer also mentioned efforts of the Credit Union National Association and credit unions nationwide to reduce the regulatory burden and to increase credit unions' ability to make business loans to members. 

U.S. Sen. Mark Udall's (D-Colo.) Small Business Lending Enhancement Act (S. 968), introduced in the Senate on Thursday, would increase the credit union member business lending cap to 27.5% of assets, from the current 12.25% (News Now May 17).

The Georgia Trend article also featured a sidebar interview with consumer advocate Clark Howard, who is a member of two credit unions. Because of the spread of technology in the modern financial world, Howard believes credit unions have a bright future.

"That's the leveler for them, the thing that really helps, because most credit unions are smaller than banks, but most all banking now is electronic," he explained. "It's the great equalizer."

The article also includes comments about growth and some of the attributes of credit unions from Jerry Johnson, president/CEO of Georgia Power Valdosta FCU in Valdosta, and Janet Davis, president/CEO of TIC (The Infantry Center) FCU in Columbus.

Youth 'Stached Their Cash--All $25.2M--With CUs

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MADISON, Wis. (5/20/13)--Young credit union members deposited about $25.2 million into their share and savings accounts during this year's National Youth Saving Challenge, sponsored by the Credit Union National Association.

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The 224 credit unions participating this year collectively saw 117,244 youth deposit an average of $214 each.

In 2009, the Saving Challenge expanded beyond National Credit Union Youth Week to run the entire month of April. Credit union staff told CUNA that a week wasn't long enough. This year, more than half (60%) of the participating credit unions ran the challenge for the entire month--giving them more time to open 6,173 new youth accounts.

The National Youth Saving Challenge also rewarded 10 randomly drawn savers with $100 cash prizes. The winners were:

  • Click to view larger image Holding a magnifying glass that would make Sherlock Holmes envious, super saving sleuth Rhys Hollowood cracks the mustache mystery during National Credit Union Youth Week at Clearview FCU in Moon Township, Pa.
    Amara, age 8, from Electro Savings FCU, St. Louis;
  • Sydney, age 2, from Jax FCU, Jacksonville, Fla.;
  • Bryar, age 1, from Lakeview CU, Neenah, Wis.;
  • Rylee, age 5, from North Georgia CU, Toccoa, Ga.;
  • RJ, age 6, from Richmond Community FCU, Augusta, Ga.;
  • Christopher, age 9, from Rockford Postal ECU, Loves Park, Ill.;
  • Rylee, age 2, from Sioux Valley Coop FCU, Watertown, S.D.;
  • Charleigh, age 1, from Susquehanna Valley FCU, Camp Hill, Pa.;
  • Cheyanne, age 3, from United Health CU, Burlingame, Calif.; and
  • Max, age 4, of Monument, Colo., from Wilmington (Del.) Postal FCU.
Click to view larger image Hamilton the Pig--the Kids Club mascot at Unitus FCU, Portland, Ore.--took photos with young savers at an open house and entertained third-graders at a nearby school by leading The Dollar Holler Rap, after which every student received a Hamilton piggy bank. (Photos provided by CUNA)

CUNA also sponsors National Credit Union Youth Week, which was held April 21-27. The theme for this year's youth week was Saving Sleuth: Solve the Mystery. The week was created by CUNA so credit unions nationwide could focus on the financial needs of young people and provide financial literacy education. It teaches the benefits of saving and goal setting, and invites youth to open savings accounts at their credit union and make deposits throughout the year.

In 2014, National Credit Union Youth Week will be celebrated April 20-26.

Raising awareness about credit unions is one of the steps in CUNA's, leagues' and credit unions' Unite for Good campaign to achieve the vision of Americans choosing credit unions as their best financial institution. As that awareness grows, potential members will turn to aSmarterChoice and Unite for Good websites to locate credit unions they can join and find out more.

In 2014, National Credit Union Youth Week will be celebrated April 20-26.

Bankrate: Two-thirds Of Prepaid Debit Cards Have No Monthly Fees

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NEW YORK (5/20/13)--A study of 24 widely issued prepaid debit cards indicates all charge fees of some kind. However, two-thirds either have no monthly fee or offer a fee waiver.

The fees vary widely by card and how the consumer uses it, said Bankrate.com, which conducted the survey in February. Credit union prepaid debit cards were not among those in the study.

"The biggest development in the prepaid card market over the past year was the entry of several large national and regional banks," said Greg McBride, senior financial analyst at Bankrate.com. Many offer cards with fixed monthly costs. "The ability to know the monthly cost in advance is valuable to consumers, particularly with the decline in free checking accounts," McBride said.

Only 39% of banks offer stand-alone free checking accounts. That compares with 72% of credit unions, according to a previous Bankrate.com survey.

In the prepaid debit cards study, 15 cards (63%) charged a monthly service fee of $3 to $9.95. Eight of these offer either a fee waiver or fee reduction, based on how much is automatically loaded onto the prepaid card.

Other fee findings:

  • Activation fees: Two-thirds of the cards have no activation fee if purchased online, and 54% can be purchased in person with no fee. The fees are $2.99 to $14.95.
  • Reload fees: None of the cards charged reload fees.
  • ATM withdrawal fees: All cards charged a fee, which ranged from $1.50 to $2.75 per transaction, to withdraw from another institution's ATM. Fifteen cards have their own ATM networks. Of those, 67% charge in-network consumers between $1.50 and $2.75.
  • ATM balance inquiry fees: Fifty-four percent of the cards charge this fee, which ranges from 45 cents to $1 regardless of which network the ATM belongs to. Of the remaining 11 cards, five charge this fee at some ATMs, four don't charge at all and the other two don't permit ATM balance inquiries.
  • PIN/signature point-of-sale (POS)  fees:  Roughly 71% don't charge for PIN POS transactions, and two don't permit this type of transaction. The five cards with this fee charge from 49 cents to $2. Twenty of the 24 cards, or 83%, do not charge a signature POS transaction fee. Those that do, charge 95 cents to $1.
  • Monthly statement fees:  Fifty-eight percent of cards charge $1 to $5.95 for monthly statements by mail, 33% don't charge the fee and 8% don't offer mail statements. None of the cards offer a statement that can be printed at an ATM.
  • Bill payment fees: Twenty-two cards (92%) do not charge this fee. One assesses 99 cents for each payment and another charges $1 for bills paid via paper checks.
  • Customer service fees:  Of those surveyed, 17% charge for customer service calls, with $2 the most common fee, and 88% provide at least one free call per month. Two-thirds never charge for telephone customer service.
  • Declined transaction fees: Fifteen cards--63%--do not charge for declined transactions. Five (21%) assess 25 cents to $1.95 for each declined transaction. Four charge only for  transactions declined at an ATM; they assess $1 or $2.
  • Inactivity fees: In the study, 29% of the cards charged an inactivity fee, ranging from $1.95 to $5.95 after 90 days of inactivity, and 71% don't charge the fee but may close the card after three to six months of inactivity.
For a list of cards with their specific fees, use the link.

PCUA Meeting Speaker: To Reach Young, Serve Parents First

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HARRISBURG, Pa. (5/20/13)--To reach America's youth, credit unions should first serve their parents because children are highly influenced by their parents' recommendations, keynote speaker Mark Arnold told the opening session Thursday at the Pennsylvania Credit Union Association's 2013 Annual Convention and Expo.

Arnold, of On the Mark Strategies, presented 10 images of what future members will look like and challenged credit unions to find their own niche (Life is a Highway April 17). Credit unions are in a time of convergence between "bricks and clicks," when members value branches while also migrating using electronic/mobile services, he said.

Credit unions should train their frontline staff to ensure that members of all ages are served effectively, Arnold advised.

After the general session, Arnold conducted a special session for volunteers on how to run effective board meetings.

The exposition included 70 exhibitors offering products and services for credit unions.

MCUL & Affiliates Endorses Peters For U.S. Senate

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DETROIT (5/20/13)--The Michigan Credit Union League & Affiliates endorsed U.S. Rep. Gary Peters (D-9) for the U.S. Senate, citing his legislative record of supporting common-sense financial measures that help middle-class families, small businesses and community-based financial institutions such as credit unions.

"Congressman Gary Peters has been a true champion for reasonable, bipartisan financial solutions that benefit local economies, and Michigan credit unions are confident that he will continue the fight to move our economy forward as our next U.S. senator," said MCUL CEO David Adams (Michigan Monitor May 17).

"[He] has a been a leader in supporting families on Main Street and helping small businesses get access to much-needed credit and capital that can help them grow and create jobs," Adams added.

Peters has demonstrated understanding and support for the critical role credit unions play in moving the state and the nation's economy forward, MCUL said. Since taking office in 2009, Peters co-sponsored and helped pass the Small Business Jobs Act of 2010, making it easier for small, community-based financial institutions to increase their capacity to lend. That resulted in billions of dollars in new loans to help small businesses, MCUL said.

"Peters has a record of strong championing of credit union issues, and the Credit Union National Association  intends to work closely with the Michigan league to elect him to the U.S. Senate," Trey Hawkins, CUNA vice president of political affairs, told News Now. CUNA's Credit Union Legislative Action Council already has contributed to Peters the legal maximum of $10,000 for the 2014 election, Hawkins noted.

Peters also authored the Small Business Credit Initiative, which made available $79 million in federal funding for Michigan-specific lending programs, helping businesses create thousands of new Michigan jobs, MCUL said.

Three times Peters has co-sponsored legislation to raise the cap on credit union member business lending, a measure which would free up millions of dollars in capital for small businesses and create thousands of new jobs, without costing taxpayers a dime, MCUL said. CUNA has said raising the cap to 27.5% of a credit union's total assets from 12. 25% will generate $13 billion in new loans and create 140,000 jobs.

Maine Committee Nixes Foreclosure Bills, League On Work Group

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PORTLAND, Maine (5/20/13)--Six of seven foreclosure bills introduced in Maine's Legislature failed to make it out of the state's Judiciary Committee last week. The seventh, which is supported by the Maine Credit Union League, will be the basis for a study group, which will include the league as a participant.

The state Judiciary Committee on May 13 voted "ought not to pass" on six of the foreclosure bills and voted to carry over the seventh, L.D. 1389, a measure that would expedite the foreclosure process, said the league (Weekly Update May 17).

The league had opposed four of the six measures voted down in committee. The other two measures voted down included L.D. 125, which would have preserved lender equity during foreclosures and included an amendment drafted by the league, and L.D. 392, which dealt with the original mortgage note.

The Attorney General is expected to convene a study group, which would use L.D. 1389 as a basis to study and suggest changes to the foreclosure and mediation process.   The league testified recently in support of L.D. 1389 at a public hearing and said it  will participate in the group, which expects to meet over the summer and fall.

"Many of the components of L.D. 125 are expected to be brought forward as part of the study group's discussions, and, ultimately, the defeat of the original mortgage note bill does not negatively impact credit unions in any way," the league said.

"We supported this bill with an amendment we drafted last session, and it overwhelmingly passed the House and Senate before being vetoed by the governor, so we saw no valid reason not to support it again this year," said league President John Murphy.

"Our main focus is on making meaningful changes that will curb abuse in the foreclosure process which is what our credit unions have asked us to do," Murphy said.  "We will continue to work for changes that balance the interests of the lenders and consumers, and look forward to being involved in these ongoing discussions."

CU System Briefs (05/17/2013)

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  • DALLAS, Texas (5/17/13)--Theresa Portillo, 44, former CEO of the defunct Women's Southwest FCU has been sentenced for the embezzlement of more than $3.4 million from the Dallas-based credit union.  Portillo was sentenced to  six and a half years in prison, and ordered to pay  $3.4 million in restitution. She also forfeited nine properties in the Dallas-Fort Worth area, a time share in Cabo San Lucas, Mexico, and jewelry after pleading guilty in January to the embezzlement. Federal Bureau of Investigation investigators alleged that Portillo stole from 18 financial institutions, selling many certificates of deposit and having the proceeds wired to a JP Morgan Chase account in the credit union's name. Other credit union employees had assumed the account was inactive. She allegedly used an account under a fake name to make her transactions. The National Credit Union Administration liquidated the credit union in November (The Dallas Morning News May 10) ...
  • OKLAHOMA CITY, Okla. (5/17/13)--National Credit Union Administration Board Chairman Debbie Matz visited Oklahoma City-based WEOKIE CU's main office and operations center on May 14th. "As the leader of the National Credit Union Administration, Chairman Matz plays a very important role in the regulation of credit unions. We are honored that she visited our state and credit union," said Brent Taylor, WEOKIE president/CEO. Matz was visiting the area to speak at the Credit Union Association of Oklahoma's Annual Meeting this week. Pictured during the visit are, from left: WEOKIE CU Board Members Jack McCurdy, Ron Wynne and Leonard Well; Matz; and WEOKIE Board Members Gary Tarkington, Frank Cory, Wanda Beaman, Warren Pybas and Tony Carl. (Photo provided by WEOKIE CU) ...
  • MILTON, Pa. (5/17/13)--After 36 years, the founders of the Milton, Pa.-based NU Community CU, Leroy and Patricia Miller, have announced their retirement. The Millers founded the credit union in 1977, when Leroy Miller was employed with Chef Boyardee. He approached the union about forming a credit union. The credit union's board of directors would meet in the Millers' home on Sunday afternoons to complete the weekly transactions. The credit union began with $81 and now has nearly $20 million in assets, he said. Discussing changes over the years, he said computers made transactions easier but also added rules that complicated the process. The Millers both said they will miss the people they have worked with over the years. Their daughter, Mindy Plasters, will become manager after working for the credit union for 27 years (Standard Journal May 11) ...

Camilla, Duchess Of Cornwall, Joins a CU

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LONDON (5/17/13)--Camilla, the Duchess of Cornwall, has applied for membership at London Mutual CU in Peckham, England.

It will be the first credit union she has joined, although she has visited five credit unions in England and Scotland since 2010. She is eligible as a resident of Westminster (The Telegraph May 15).

A spokeswoman at Clarence House said the Duchess, who is married to Prince Charles, wanted to join the credit union to show her support of the credit union's bid to tackle payday lenders.

Last year, LMCU became the first British credit union to offer short term payday-loan alternatives. It offers short term loans at 28.6% annual percentage rate (APR), compared with other payday lenders who charge 4,000% APR. During its 12-month pilot, LMCU received 6,087 applications, with loans averaging nearly $363 (in U.S. dollars).

The credit union said it is attracting 250 new members a month. It plans to share its technology with other credit unions across the country, said The Telegraph.

A year ago, News Now reported on the Duchess' visit at Capital CU in Edinburgh,Scotland, where she praised credit unions' work to increase financial inclusion (serve the unbanked) and money management skills in disadvantaged communities (News Now May 14, 2012).

Cornerstone CU League Transitional Board Appointed

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NORMAN, Okla. (5/17/13)--The Cornerstone Credit Union League has appointed a transitional board of directors.

Member credit unions of the Arkansas Credit Union League, the Credit Union Association of Oklahoma and the Texas Credit Union League had voted to consolidate into the Cornerstone league, as of July 1.

The league's transitional board includes three directors from Arkansas, three from Oklahoma, and 12 from Texas. Some will serve one-year terms while others will serve two- and three-year terms, ensuring continuity on the board (LoneStar Leaguer May 16).

Arkansas directors are:

  • Dwayne Ashcraft, Arkansas Superior FCU, Warren;
  • Allen Brown, Mil-Way FCU, Texarkana; and
  • Windy Campbell, Electric Cooperatives FCU, Little Rock.
Oklahoma directors are:

  • Jason Boesch, Oklahoma RE&T Employees CU, Oklahoma City;
  • Michael Kloiber, Tinker FCU, Oklahoma City; and
  • Gina Wilson, Oklahoma Central CU, Tulsa.
Texas directors are:

  • Jim Brisendine, Resource One CU, Dallas;
  • James L. Boyd, Abilene Teachers FCU, Abilene;
  • Z. Suzanne Chism, Texas Health Resources CU, Dallas;
  • Nancy M. Croix Stroud, First Class American CU, Fort Worth;
  • Kenny Harrington, MemberSource CU, Houston;
  • Wayne Mansur, Texoma Community CU, Wichita Falls;
  • Carol Murray, Express-News FCU, San Antonio;
  • Robert Peterson, One Source FCU, El Paso;
  • Paul A. Trylko, Amplify FCU, Austin;
  • James S. Tuggle, Transtar FCU, Houston;
  • JoBetsy Tyler, First Central CU, Waco; and
  • Paul Withey, Texas Bay Area CU, Houston.

Filene: Top Factors In Consumers' Auto Finance Choice

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MADISON, Wis. (5/17/13)--Auto loan loyalty stems from more "high touch" factors, such as good member service, ease of contacting the lender and lender responsiveness, than from quantifiable factors, such as interest rates and down payment requirements, according to a new report from the Filene Research Institute.

Credit unions' relationship strengths play a large role in auto loan selection, while their historical pricing strength (at least in aggregate) seems to be less important, said the paper, "Predicting Members' Choice of Auto Lender: Borrowing from Credit Unions or Elsewhere?"

Members placing more importance on service were far more likely (by 41%) to choose a credit union for their auto loan. Similar increases in credit union share were found for ease of contacting the lender (40%) and lender responsiveness (38%).

Most members report being greatly satisfied with their credit union and being committed to credit unions in general. However, questions about those topics are not useful predictors of members' choice of an auto lender, the report said.

For instance, members who rate highly their credit union's prompt resolution of problems are only moderately more likely (by 13%) to choose credit unions for their auto loans. Members who report that they specifically seek out credit unions to serve their financial needs are barely more likely (by 5%) to choose credit unions for their auto loans than more "casual" members.

The research did not find a clear correlation between preferred communication channels and choosing a credit union for an auto loan. However, it did reveal a member preference for electronic information. The credit union website is the most preferred communication channel, followed by e-mail and then by credit union employees. The least preferred are branch brochures, and signage and social media.

"In short, credit unions should care about price, but not too much," the report said. "They should double down on electronic communication methods to advertise and originate loans. And they should remember that auto loan-loyalty stems from good member service and ease of contacting the credit union. Nurture those, and you'll do well."

CEOs Upbeat On Economy For Members, Cautious For CUs

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PLANO, Tex. (5/17/13)--Credit union CEOs are upbeat about economic conditions for their members, but are more downcast about the operating environment for their own institutions, according to the results of Catalyst Corporate FCU's First Quarter 2013 CEO Confidence Survey.

CEOs' confidence in their members' current and future  (six months from now) financial condition increased by 4.13 points and 1.17 points, respectively from the fourth quarter of 2012 survey levels. However, CEOs' confidence in their own institutions' financial condition--both current and future--dropped by 1.99 points and 0.18 points, respectively, from the previous quarter.

"Credit union executives see member finances improving as a result of declining unemployment, a protracted low interest rate environment and practically no inflation," said Brian Turner, Catalyst Strategic Solutions' director and chief strategist. "Although wages remain flat and job growth continues to be weak--keeping job security a concern--consumers have been branching out a little more with their spending, which certainly helps economic growth."

The overall Confidence Index in the most recent survey inched up by half a point over the fourth quarter. Similarly, CEO expectations for loan demand and share deposit growth saw relatively little movement from the previous report.

Tight marginal spreads between asset yields and cost of funds continue to challenge credit unions' net interest margins, Turner said. About 31% of total credit unions experienced loan growth in 2012, according to National Credit Union Administration data.

"That means the remaining 69% have elevated surplus cash and a greater reliance on investment portfolio income to replicate revenue streams--a difficult task to accomplish in this environment," Turner said. "With an outlook that reflects a continuation of the low-rate environment for two to three more years, CEOs don't see these challenges for their institutions going away anytime soon."

Idaho League Board Chair, Award Winners Announced

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BOISE, Idaho (5/17/13)--The Idaho Credit Union League elected a new board chair and a presented awards for outstanding professional of the year and outstanding volunteer of the year at the league's 77th annual meeting in Couer d'Alene.

Shane Berger, CEO of Beehive FCU in Rexburg, was elected board chair Former Board Chair Brent Neibaur, CEO of Advantage Plus FCU in Pocatello, completed his term May 10.

Berger, who has been CEO of Beehive FCU for 28 years, is a previous recipient of the Idaho Credit Union League's Professional of the Year Award. He has been an active member of the league for many years, serving on the board and the Board of League Services Inc.--a wholly-owned subsidiary--as well as committees, including Member Advocacy Subcommittee, Governmental Affairs Committee and League Finance Committee.

He also serves on the World Leadership Development Committee and on Catalyst Corporate CU's Advisory Council.

The league named Greg Sonnen, CEO of Cottonwood Community FCU in Cottonwood the winner of this year's Outstanding Professional of Year the Award.

When Sonnen began as CEO in 2004, the credit union had assets of $28,713,661. Under his leadership, the credit union now has more than $73 million in assets. Sonnen attends the league's educational and governmental affairs events and serves on its committees. He recently was appointed to the Board of Directors of League Services Inc. He participates at the national level by traveling to Washington, D.C., to present Idaho credit union concerns to Idaho's congressional delegation.

The league named Kimber Ricks, board director, Beehive FCU in Rexburg, as this year's Outstanding Volunteer of the Year Award-winner. Ricks has served as Beehive FCU's vice chair and on several committees.

Ricks also serves on a subcommittee of the league's Governmental Affairs Committee, and has participated in trips to Washington, D.C., to meet with the Idaho congressional delegation.

TCUF Assessing Tornadoes' Impact On CUs

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FARMERS BRANCH, Texas (5/17/13)--Staff of North Texas credit unions in the area of two tornadoes Wednesday in Granbury and Cleburne are reporting damage to their homes.

The Texas Credit Union Foundation said it was assessing the situation and is ready to assist credit unions and their employees impacted (LoneStar Leaguer May 16).

Tornadoes late Wednesday hit north-central Texas, damaging several homes, injuring 100 people and killing six (Property Casualty 360 May 16).

"I have spoken to the CEO [Paul Elkins] at Members CU in Cleburne," TCUF Executive Director Courtney Moran told News Now. "His staff is all OK, but almost everyone is without power, so they have not had much time to assess damage, if any. He has distributed the foundation's Phase I grant application to staff and we will stay in communication.

"I received word that a couple of staff members at Texas People FCU [in Fort Worth] did receive damage to their homes," Moran added. "Neither one of them are in the office today, but I did leave a message with her assistant, have sent her an e-mail, and they will receive all direct messages as well."

TCUF will activate its disaster relief fund if it is determined that the damage is widespread.

"In times of crisis, the foundation is here to help our credit unions and their staffs get back on their feet so that they in turn can be there for their members," said Moran.

"Already I received countless e-mails and phone calls from credit unions across the state wanting to know how they can help," Moran said. "It's so gratifying to know that we serve in a movement where people really care about each other."

News reports indicated more than 50 people were taken to a Granbury hospital, where 14 were admitted for treatment of injuries and two were transferred to a hospital in Fort Worth, TCUF said.  

TCUF will notify credit unions if and when its disaster relief fund is activated.

Ohio League: State Budget Still Absent Tax Reforms

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DUBLIN, Ohio (5/17/13)--Ohio's state budget bill is still being debated in the state's General Assembly, and so far it remains absent any major reforms that would impact credit unions' tax status, said the Ohio Credit Union League. However, the league said Wednesday, "until it passes, this could change at a moment's notice" (eLumination May 15).

"It is most likely that separate legislation will be introduced in the coming months that could change Ohio's tax code, especially considering the buzz by state legislators and administration officials about 'reform,' which suggests moderate tax implications at minimum," the league said.

Taxes are always on the top of the list for "reform" to make up lost revenue streams, said league General Counsel John Kozlowski.

In addition, entities such as the Ohio Chamber of Commerce are proposing that the state close tax exemptions to lessen the need for tax increases, the league reported.

Because of the fluid nature of the tax reform issues at the state and federal levels, the league said it is constantly monitoring lawmakers' discussions to protect credit union interests.

The league, like leagues in other states, have joined the Credit Union National Association in rallying 96 million credit union members to proactively advocate for preserving credit unions' tax exemption on the state and federal levels.  Preserving and defending the tax status is CUNA's and the leagues' No. 1 priority.

For more information, use the links.

New York CUs Award $225,000 In Scholarships

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

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

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

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

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

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

CU System Briefs (05/16/2013)

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

IC3: Online Fraud Losses Increased In 2012

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

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

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

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

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

Other highlights from the report were:

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

cuStudentLoans, joinStampede Form Student Loan Refinancing Program

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

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

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

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

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

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

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

CUNA Fees Report; CUs Continue As The Better Deal

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

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

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

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

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

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

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

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

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

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

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

NCUF's Sebastian Announces Retirement

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

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

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

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

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

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

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

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

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

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

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

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

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

Purvis Elected To CO-OP Board

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

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

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

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

Kansas CUs Pick Up Tab At Seven Businesses

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

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

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

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

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

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

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

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

N.J. Governor Nominates Mullen As Banking Division Head

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TRENTON, N.J. (5/15/13)--New Jersey Gov. Chris Christie Monday nominated Patrick Mullen to head the Division of Banking within the state's Department of Banking and Insurance (DOBI).

Mullen's nomination is subject to confirmation by the state Senate, the New Jersey Credit Union League said (The Daily Exchange May 14).

Mullen serves as the division's assistant director in charge of the Office of Consumer Finance (OCF). OCF regulates state-chartered credit unions and other consumer financial businesses and activities, including mortgage bankers and brokers, check cashers, foreign and domestic money transmitters and pawnbrokers.

As division director, Mullen will also oversee the regulation all state-chartered banks. 

Before joining DOBI in 2011, Mullen held senior positions at Alliance Capital Management, ABN AMRO Bank and Barclays Capital.

CU System Briefs (05/15/2013)

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  • NEW YORK (5/15/13)--A Supervisory Committee Webinar Series, hosted by the National Federation of Community Development Credit Unions,  continues Thursday with a webinar on detecting fraud and embezzlement from 6 p.m. to 7:30 p.m. EDT.  Deputy District Attorney James Teh will explore cases from the San Diego District Attorney's Office that demonstrate how the simplest oversight or mistake can reveal years of undetected fraud and embezzlement. His session also will cover reports and compliance information every supervisory member should know. Use the link for more information ...
  • CRANBERRY TOWNSHIP, Pa.  (5/15/13)--A customer service representative from Keystone United Methodist FCU saved a panicked member from becoming a victim of the "grandparent scam," according to the Pennsylvania Credit Union Association (Life is a Highway May 14). The member rushed into the branch asking for money and saying he had received a call from his grandson, who needed money immediately for bail to get out of jail in Haiti. Darlene Jewett, the first employee the man spoke to, sensed something wasn't quite right about the situation and consulted with other staff. "We asked him if he was sure that the voice on the phone was his grandson," said Patti Columbe, CEO. "He thought it was, but wasn't 100% sure." Staff notified the Federal Bureau of Investigation and verified that the call was an attempt to steal money from the member through telephone fraud.  According to the FBI, the grandparent scam started in 2008 but has become more developed and sophisticated since social networking sites have become more popular, said PCUA ...

Catalyst Corporate Launches Second Satisfaction Survey

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DULUTH, Ga. (5/15/13)--Responses to Catalyst Corporate FCU's Second Annual Satisfaction Survey are due Friday.

Survey results will be used to obtain data to support benchmarking and decision-making for allocation of Catalyst Corporate CU's resources.

"The online survey measures satisfaction with engagement and service, gathers a high-level assessment of Catalyst's products and services, and gauges the likelihood of respondents recommending Catalyst to other credit unions," said Kathy Garner, Catalyst Corporate president/CEO.

About 540 representatives from 300 credit unions responded to Catalyst Corporate's 2012 survey. Member feedback was collected by the Catalyst Councils and Catalyst Corporate's board of directors. The survey generated a Net Promoter Score (NPS) by calculating responses to the question: "How likely are you to recommend Catalyst Corporate to a friend or colleague?"

Catalyst Corporate scored an NPS of 64; any score above 50 is considered excellent, said the corporate. The average score in the banking industry is 18. Respondents cited Catalyst Corporate's quality of service and helpful staff as reasons they would recommend the organization to others.

Results will be tabulated during June and will contribute to Catalyst's strategic planning in September.

Cirque Director: Creative Fire Can Propel CU To Greatness

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WASHINGTON (5/15/13)--She's not saying that credit union folks should get up in the morning and put on shocking-colored leotards and tights. But when they rise and shine, credit union employees have every reason to compare themselves to the artists and athletes who hurl themselves beautifully and almost magically through the air on a Cirque du Soleil stage, according to Lyn Heward, director of creation for Cirque du Soleil.

Heward will address a credit union crowd during the Credit Union National Association's America's Credit Union Conference next month in New York City. Her presentation--and her recent book--are entitled, "The Spark: Igniting the Creative Fire that Lives Within Us All."

She brings this message: For their own good and the good of the entire movement, credit unions must make sure they are kindling their employees' creative fire.  It is what will set them apart from the competition.

In a recent interview, Heward told News Now that Cirque is like any organization--in some ways. It attracts both tough-minded practitioners--for Cirque, that is athletes with years of training behind them--and creative artists--who have the same amount of determination as the practitioners but a "broader focus on the world around them."

It is the diversity of tools that these employees bring, she says, that builds a successful operation. And it is any manager's job to recognize that "we are all creative" and to help open employees' minds to the idea of pushing boundaries and "using the tools of the past to build a better future."

And that, Heward emphasizes, is why employees' creativity is vital to any organization.

"We all have competition," she says, adding that part of what makes Cirque--or any organization--better is acknowledging that they are fighting a competitive battle--knowing there are other things out there for people to do, or see, or access.

"It's not what you do now that will bring you into the future.  It's having a vision of what you want to become--see how you can evolve and add to your relationships with members and your communities."

Heward advises that every organization must gear its creativity directly to its purpose: while Cirque entertains, credit unions provide financial services to members.

"Where you really have to be creative is in your initiative to show your members what steps you have taken to serve them better."

It's a manager's job, she says, to take two key actions to lead a creative team: inspire them and acknowledge them. Creativity will not flourish without these managerial elements, she says.  You can inspire your team in many ways, even by simply encouraging them to change things up--eat something different for lunch, take a different route to work, anything to get their creative brains out of their "regular track."

She shares another tip. "Remember not all ideas work," at least not the first time around.  But by encouraging employees to fire off many creative ideas all the time, a manager will have a deep pool of resourcefulness from which to fish at all times.

America's Credit Union Conference will be June 30-July3. For more information, use the link.

BizKid$ Nominated For Three Daytime Emmys

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MADISON, Wis. (5/15/13)--Biz Kid$, the credit union-funded public television series that teaches kids about money management and entrepreneurship, has received three Daytime Emmy Award nominations from the National Academy of Television Arts & Science.

"These nominations are a testament to the quality of the show" said Danielle Brown, Biz Kid$ program coordinator for the National Credit Union Foundation. "As a financial literacy resource, Biz Kid$ continues to teach millions of young people how to make and manage their money--something that is needed now more than ever." 

The series was nominated in the categories of: Outstanding Achievement in a Single Camera Editing, Outstanding Achievement in Sound Mixing and Outstanding Achievement in Sound Editing. Awards will be presented June 14 in Los Angeles. 

Biz Kid$ received 13 Emmy nominations in the past five years, winning once in 2009. The Daytime Emmy Awards recognize excellence in American daytime television programming. Emmys are considered the television equivalent to the Academy Awards (for film), Grammy Awards (for music) and Tony Awards (for stage).

Biz Kid$ has continually garnered attention in and outside of the credit union industry. The show has won the Environmental Media Award for Outstanding Children's Television Series, a Silver Telly Award for Outstanding Children's Financial Literacy Programming and most recently the Parent's Choice Gold Award.

In 2010, it also earned 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$. During the past six years, more than 300 credit unions and affiliated organizations have raised at least $13.8 million to support the show's production, website and curriculum.

Every Biz Kid$ episode begins and ends with a narrator reminding viewers that: "Production funding for Biz Kid$ is provided by America's Credit Unions, where people are worth more than money."

Okla. CUs Vote To Consolidate With Texas, Arkansas Leagues

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NORMAN, Okla. (5/15/13)--Member credit unions of the Credit Union Association of Oklahoma voted  49-10 in favor of consolidating with the Texas and Arkansas Credit Union Leagues into a single Cornerstone Credit Union League.

Oklahoma credit union delegates voted Tuesday afternoon during CUAOK's special member business meeting in Norman, Okla. Member credit unions of the Arkansas and Texas leagues have already approved the measure.

Cornerstone will become official July 1, according to the LoneStar Leaguer (May 14).

"Given the outcome of today's vote, it's quite clear that Oklahoma credit unions are progressive and forward-focused," said CUAOK President/CEO Gary Jones. "I'm very excited to have the voting behind us because now we can focus on building the Cornerstone Credit Union League."

"This is truly a momentous occasion," said Gina Wilson, CUAOK board chair. "We've been discussing and working toward this goal since last summer and it's wonderful to see our efforts come to fruition."

While the new organization won't become effective until July 1, the initial board of directors will meet before then to help ensure a smooth transition, said the association.

Media Comparisons Of CUs, Banks Tilt In CUs' Favor

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MADISON, Wis. (5/15/13)--In the 11th of a 12-part "Head to Head" series of articles, Business Insider Tuesday pitted credit unions versus big banks and asked: "Where Should You Put Your Money?" The verdict?  Credit unions.

The publication isn't alone in pointing out the value of credit unions. King5.com, Seattle's CBS affiliate, also focused on the cooperative difference in a segment Monday entitled "Credit Unions Vs. Traditional Banks."

The Business Insider discussed pros and cons of credit unions versus banks in four areas: accessibility, fees, interest rates, customer service. Credit unions won three of the four. On the fourth--accessibility--the best the banks got was a "draw."  Here's a sampling:

Accessibility: Credit unions are meant to serve local communities so they might not have as many ATMs but they compensate by offering surcharge-free banking.

Fees:  "Big banks are notorious for levying major fees against customers for everything from overdrafts to monthly maintenance fees and they've only gotten worse." The article cited a MoneyRates.com survey showing an 18-cent increase in banks' average monthly fees, and Bankrate.com's survey indicating 70% of the largest credit unions offer free checking while 5% of banks do. "Hands down, credit unions are friendlier on the fee front."

Interest rates: Credit unions offer higher yielding accounts but it noted that may not be enough to prompt bank customers to switch banks.

Customer service: "Once again, credit unions beat big banks. But as their customer base grows, it will be crucial for the industry to ramp up resources to meet demand."

"If you are able to take advantage of a credit union and don't mind the lack of ATMs and physical branches, they are by far the best option for banking today," said Business Insider.  "You'll pay fewer fees and get more personalized services out of the deal as well."

In Seattle, CBS's "New Day' producers, which partnered with Washington State Employees CU for the past year to provide consumers financial information, said the most common question it receives about the show is "What is the difference between credit unions and just traditional banks?"

WSECU's Suzanne Klenk discussed two key differences--cooperative ownership and philosophy--and outlined seven cooperative principles of credit unions: voluntary and open membership; philosophy, democratic member control, members' economic participation, credit unions' autonomy and independence, an emphasis on financial education, cooperation among cooperatives, and concern for community. Use the links to access both the article and the segment.

Spreading awareness about credit unions' value is one of the three prongs underlying the Credit Union National Association's and credit unions' Unite for Good campaign, which aims to rally credit unions toward the strategic vision in which Americans choose credit unions as their best financial partners. For more information, visit the Unite for Good and aSmarterChoice.org sites in the links.

Virginia League Announces Board Election Results

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LYNCHBURG, Va. (5/15/13)--The Virginia Credit Union League announced the results of recent elections in its board of directors' reorganization meeting.

Officers elected were:

  • Chairman--Suzanne Hodgins, UVA Community CU, Charlottesville;
  • Vice Chairman --Karen Orie, Hampton Roads Educators' CU, Hampton;
  • Treasurer--Rose Gilliam, Argent CU, Richmond; and
  • Secretary--Chris Williams, Henrico (Va.) FCU.
Other board election results include:

  • Stan Leicester, BayPort CU, Newport News, re-elected to represent credit unions with $50 million or more in assets in the Hampton Roads and Tidewater chapters;


  • Iris Ellis, Assurance FCU, Richmond, re-elected to represent credit unions with less than $50 million in assets in the Richmond and Southside chapters;


  • Cliff DeMars, Blue Eagle CU, Roanoke, re-elected to represent credit unions with $50 million or more in assets in the Lynchburg, Piedmont, Roanoke Valley and Southwestern Virginia chapters;


  • Carl Ratcliff, ABNB FCU, Chesapeake, elected as an At-Large Director;


  • Joe Thomas, Fairfax County FCU, Fairfax, re-elected as an At-Large Director.


They all will serve three-year terms.

The league board elected a slate of officers for the League Service Corp.--Virginia Credit Union Services Inc.--the league's wholly owned subsidiary, which provides products and services for credit unions, including insurance, lending assistance, shared branching, card services and share-draft processing.

Officers elected were:

  • Chairman--Ellis;
  • Vice Chairman--Gaye DeCesare, Belvoir FCU, Woodbridge;
  • Treasurer--Gilliam; and
  • Secretary--Cheryl Dickerson, Fairfax (VA.) City FCU.

WYCUP Announces Program Agenda, Speakers

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MADISON, Wis. (5/15/13)--Nominations for World Council of Credit Unions' (WOCCU) Young Credit Union People (WYCUP) scholarship program are due June 3.

Click to view larger image The 2012 WYCUP participants meet in Gdańsk, Poland. Five nominees won all-expense-paid scholarships to attend this year's World Credit Union Conference in Ottawa, Canada.
The program, an educational opportunity for credit union leaders age 35 and younger, and awards ceremony will take place at the 2013 World Credit Union Conference in Ottawa, Canada, July 14-17.

"We've heard from credit unions worldwide (of) the need to build up the next generation of leaders," said Brian Branch, World Council president/CEO. "The WYCUP program is an excellent opportunity to expose upcoming leaders to a global perspective that they can apply in their communities." 

The program seeks individuals who have made significant contributions to their own credit union organizations and have the potential to make a larger impact. Credit unions and credit union organizations affiliated with WOCCU can nominate young leaders to compete for the scholarship. Nominees must:

  • Be sponsored by their credit union or credit union organization to attend the 2013 World Credit Union Conference;
  • Be 35 years of age or younger as of this past Jan. 1; and
  • Submit a completed nomination form to WOCCU with supporting materials by June 3.
Click to view larger image Shel Holtz, principal of Holtz Communication + Technology, will present "Building the Brand through Social Media" during the World Council of Credit Unions' Young Credit Union People's educational session July 14. (Photos provided by World Council of Credit Unions)
Shel Holtz, principal of Holtz Communication + Technology and expert in integrating technology into communications strategies, will present a session on "Building Brand Through Social Media" during this year's WYCUP program.

The agenda will include general sessions, education and networking opportunities with WOCCU's board of directors and Shel Holtz. The program will conclude with the annual awards ceremony, during which five 2013 scholarship winners will be formally recognized.  Each receives an all-expense-paid trip to the 2014 World Credit Union Conference in Australia.

WOCCU will recognize WYCUP nominees in Ottawa. Conference registrants age 35 and younger qualify for registration discount. Those who would like to participate in the WYCUP events must RSVP to Lili Tangwall at ltangwall@woccu.org before June 14.

WYCUP nominees who won scholarships to attend this year's World Credit Union Conference in Ottawa included:

  • Miriam De Dios, U.S, CEO, Coopera;
  • Maire Doyle, Ireland, chairperson, Naomh Breandan CU Ltd.;
  • Brian Aalbers, Canada, manager, Libro Financial Group Branch;
  • Wesley Diniz Alves, Brazil, manager, Sicredi Social Programs and Marketing; and
  • Edyta Grzybowska, Poland, vice president, Credit Union Management Society.

Experian: Auto Loan Delinquencies Increase

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SCHAUMBURG, Ill. (5/15/13)--U.S. automotive-loan delinquency and repossession rates increased in the first quarter, announced Experian Automotive Tuesday. However, repossession rates are down for credit unions from the same time last year.

Thirty-day auto-loan delinquencies rose 1.3%, 60-day delinquencies increased 12.4% and repossessions rose 16.9%, compared with last year, according to the most recent State of Automotive Finance report.

"Obviously, we never want to see a rise in delinquencies or repossessions, but when you compare the current findings with previous years, they are still lower than the recession-level rates," said Melinda Zabritski, Experian senior director of automotive credit.

"As we continue to move forward, we should start to see more increases as some of the subprime loans coming onto the books begin to deteriorate. However, one thing most lenders will agree upon is that today's subprime borrower is less delinquent than those in the past."

Automotive repossessions jumped 16.9%, going to 0.50% in the first quarter from 0.43% in first quarter 2012, the report indicated. While repossession rates for banks, captives and credit unions are down year over year by as much as 14.9%, rates for finance companies increased 52.1%. In spite of the increase, overall repossession rates are still relatively low when compared with the peak rate of 0.71% in first quarter 2010, Experian said.

Other report findings:

  • Total dollar volume of automotive loans grew 9.6% in the first quarter, reaching $726 billion, compared with $663 billion in first quarter 2012;
  • Credit unions increased loan portfolios by $14 billion, banks increased by $20 billion, finance companies by $18 billion, and captive finance companies by $12 billion;
  • Average charge-off amounts for defaulted loans were $7,401 in the first quarter, up from $6,739 in first quarter 2012; and
  • Charge-offs still are below recession levels, with first quarter 2009 average charge-offs at $10,126.

Irish League Rejects Bank's Plan For Distressed Borrowers

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DUBLIN, Ire. (5/14/13)--The board of the Irish League of Credit Unions voted unanimously last weekend to reject a new pilot program from Ireland's Central Bank for dealing with mortgages in arrears.

The league said in a statement that concerns it had raised about the proposed framework of the plan were ignored during negotiations and that the discussions offered little in the way of meaningful relief to distressed mortgage holders (RTE and The Independent May 13).

The absence of a provision for a mortgage writeoff or write down essential to any relief plan was a "major flaw" in the proposal, the league said.  The plan was written to protect the bank's capital positions and maximize its income from mortgage interest payments "at the long-term expense of the borrower," said the league's statement.

The Central Bank had been negotiating for months with regulators of banks, credit unions and credit card providers.

CU System Briefs (05/14/2013)

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  • OREGON CITY, Ore. (05/14/13)--A woman inside the Oregon City, Ore.-based OnPoint Community CU lobby was injured May 3 after a car crashed through its front windows and landed in the lobby. Firefighters arrived and declared that the driver, an elderly man, didn't suffer any serious injuries after his car jumped the curb outside and crashed into the building (KPTV.com May 3). However, the woman inside was taken to the hospital for treatment. The building was evaluated after the accident and was determined to still be structurally sound. An estimate of the damages still hasn't been announced ...
  • EL PASO, Texas (05/14/13)-- GECU is breaking ground in El Paso, Texas, on a new concept for credit unions, partnering with a local coffee shop to appeal more to people's lifestyles.  "The new location features a warm, relaxing ambience and a mezzanine for free financial workshops. People will be able to enjoy conversation and refreshments. The latest technology will be available to conduct all financial needs with convenient extended hours that complement Kinley's Tea House hours," said Crystal Long, president of GECU. The credit union hopes to become a place where locals go to conduct business, learn about finances and enjoy a meal and Kinley's specially brewed coffee or tea (LoneStar Leaguer May 13) ...
  • WEST JORDAN, Utah (05/14/13)-- Mountain America CU just made buying a home easier with its electronic mortgage process. Homebuyers can apply online, upload all key application documents and view and sign their closing documents electronically. "There's no need to call or come into the branch to start your mortgage anymore," said Amy Moser, vice president of mortgage services for the West Jordan, Utah-based Mountain America. "One click can put members on the path to home ownership. With paperless origination now combined with Quick Close, our members are saving more time than ever during the traditionally hectic home-buying experience." The Quick Close secure paperless mortgage process provides homebuyers a quick, convenient, simple and secure way to purchase a home and allows them to have access the documents after they have closed, the credit union said ...

Corporate's FInection Video Channel Attracting Viewers

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MIDDLETOWN, Pa. (5/14/13)--The FINection video channel launched earlier this year by Mid-Atlantic Corporate FCU has generated more than 50 videos and 4,800 views during its first 10 weeks, announced the Middletown, Pa.-based corporate.

The channel, created and produced by the corporate, was launched during the Credit Union National Association's Governmental Affairs Conference in February. 

FInection  offers a range of content from economic overviews to updates on the corporate's financials. It also includes tips to increase computer speeds, news of an upcoming security conference and the fact that animal cracker boxes originally were marketed as Christmas tree ornaments, which is why the boxes have a string attached, said the corporate.

"Sometimes we share important but basic information," said Mid-Atlantic Corporate President/CEO Jay Murray." Other times, FInection is educational or helps us add interest and humor to our communications. We enjoy making the process interactive and entertaining."

Its name is a combination of the words "financial" and "connection." It can be viewed from any location with Internet access, including mobile phones and tablets. While the content is developed for Mid-Atlantic Corporate's members, other credit unions and business partners can share the news and information. Some videos address industry-wide issues and offer general fun facts.

To view FInection videos, use the link.

'Tis the Season For Student Scholarships

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MADISON, Wis. (5/14/13)--May is scholarship season, with students graduating from high school and making plans for college. Credit unions offer assistance, not only through student loans, but through scholarship programs awarded to deserving students.

Click to view larger image Joseph Wambach, executive director at the Pennsylvania Credit Union Foundation, was the guest speaker at Trevose Pa.-based TruMark Financial CU's Financial Jeopardy Game and stressed the importance of financial literacy for young adults. (Photo provided by Trumark Financial CU)

"There is no more important investment we can make in our next generation of leaders," said Anthony Pili, vice president of sales and marketing for Palisades FCU, Pearl River, N.Y., which awarded $2,400 in scholarships this year.

Many credit unions find creative ways to determine winners for financial assistance.

TruMark Financial CU, Trevose, Pa., designed The Financial Jeopardy Game, a spin-off of the long-running nightly quiz show, to award $11,400 in scholarships. The sixth annual Financial Jeopardy Game tested 10 students' knowledge in subjects relating to personal finance.

Joseph Wambach, executive director at the Pennsylvania Credit Union Foundation, was the guest speaker and stressed the importance of financial literacy for young adults.

Some credit unions asked applicants to submit an essay in addition to listing their academic accomplishments and community involvement.

Fort Campbell FCU, Clarksville, Tenn., asked scholarship applicants to submit an essay providing two ideas on ways to promote financial service to their generation. The credit union awarded six $2,000 scholarships.

In awarding $2,000 in scholarships, North Star Community CU, Cherokee, Iowa, required applicants to write an essay based on the question "Given the fragile state of the national economy, with record unemployment and deficits, describe how having an emergency saving account is more crucial than ever. How might someone utilize their credit union to focus on saving?" (Chronicle Times May 10).

Scholarship applicants at Palisades FCU submitted a written essay based on the people-helping-people philosophy.

Even scholarship winners who didn't submit essays showed a willingness to help others. "I hope to open up a local clinic where I can serve the under-served healthcare community," said Nadeen Dakhlallah, who received a scholarship from Community Choice CU, Dearborn Mich. (Dearborn Patch May 12). "I believe that the success of our state depends on future generations who are willing to put their time and effort into enriching our society."

Community Choice awarded $100,000 in scholarships this year:

Among the many other credit unions awarding scholarships recently were:

  • Peach State FCU, Lawrenceville, Ga., with $97,0000 in scholarships;
  • State Employees' CU, Raleigh, N.C. with $580,000 in scholarships;
  • Black Hills FCU, Rapid City, S.D., with $6,000 in scholarships, the Credit Union Association of Dakotas said (The Memo May 8);
  • First Community CU, Jamestown, N.D., $10,000 in scholarships (The Memo April 29);
  • First Financial CU, Lutherville, Md., $147,000 in scholarships (Baltimore Sun May 13); and
  • Vantage CU, Bridgeton, Mo., with $20,000 in scholarships (St. Louis Today May 8).

Raising awareness about credit unions is one of the steps in the Credit Union National Association's, leagues' and credit unions' Unite for Good campaign to achieve the vision of Americans choosing credit unions as their best financial institution. As that awareness grows, potential members will turn to aSmarterChoice and Unite for Good websites to locate credit unions they can join and find out more.

Wisconsin CUs' Net Income Rises 7.6% In 1Q

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MADISON, Wis. (5/14/13)--Wisconsin's state-chartered credit unions grew their net income by 7.6% during first quarter, compared with first quarter 2012, according to data released Friday by the Wisconsin Department of Financial Institutions (DFI).

"First quarter credit union performance continued the very positive trend of 2012," said DFI Secretary Peter Bildsten. "Assets and income are up. Loan quality continues to improve. Net worth remains strong at over 10%. These indicators are positive signs for the credit union industry and the Wisconsin economy," he added.

In the quarter that ended March 31, the state's 184 state-chartered credit unions grew total assets to $24.1 billion, an increase of 3.3% over year-end 2012. They also posted a return on average assets of 0.90%, down slightly from the 10-year high of 1% recorded in 2012.

Membership continued to increase, said Director of Credit Unions Kim Santos. "Another 13,000 people became credit union members in the first quarter," she said. "Total membership for all Wisconsin credit unions is closing in on 2.3 million people."

Wall Street Journal: CUs Step Up, Offer Student Loans

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NEW YORK (5/14/13)--U.S. credit unions are helping consumers who are struggling with the high costs of college education by offering more private student loans, according to an article in The Wall Street Journal Friday, for which the Credit Union National Association provided information.

"Nearly 590 of the nation's 6,955 credit unions--member-owned nonprofit financial institutions--offered student loans as of December, according to the Credit Union National Association, a trade group, up more than 50% since March 2011," the article said.

"Though credit unions account for just a tiny slice of the student loan market, the amount they hold nearly doubled to more than $2 billion in the same period," the Journal added.

2nd Order Solutions, a credit-risk advisory firm, said credit unions control 8% of the roughly $8 billion annual market in private student-loan originations--of which the federal government originates 90%, the article indicated.

For borrowers, credit unions' student loans tend to be among the least expensive options, Mark Kantrowitz, publisher of Edvisors.com, which operates financial aid and college planning websites, told the Journal.

The article mentions that consumers can find a credit union to join by using the aSmarterChoice.org website, a joint project of CUNA and the American Association of Credit Union Leagues aimed at helping create consumer awareness of credit unions and building membership.

The Journal also noted that the University of Wisconsin CU in Madison, Wis., will start allowing borrowers to consolidate private student loans this month. Four credit unions were featured in the article.

To read it, use the link.

CUNA's first annual High School Student Borrowing Survey, released last month, found that nearly half of high school seniors don't know how much they will need for college costs. That lack of knowledge translates to a greater student-debt burden after college. CUNA is lobbying the federal government to allow student loans of a longer duration than the current 15-year standard because today's loans are for larger amounts.

Raising awareness about credit unions is one of the steps in CUNA's, state leagues' and credit unions' Unite for Good campaign to achieve the vision of Americans choosing credit unions as their best financial institution. As that awareness grows, potential members will turn to aSmarterChoice and Unite for Good websites to locate credit unions they can join and find out more.

Calif. DFI Warns CUs About Ads' FOM Language

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SACRAMENTO, Calif. (5/14/13)--The California Department of Financial Institutions (DFI) issued a warning about credit unions using certain language about their fields of membership in their advertising.

In the April monthly bulletin, the California DFI issued a statement regarding "Impermissible Advertising by Credit Unions."

"The Department has recently become aware of certain impermissible advertising campaigns by credit unions. The advertisements state that 'everyone can join' or 'all individuals can join' the credit union," DFI said in the bulletin.

"Advertisements that display this message violate the Commissioner's regulation concerning common-bond requirements for field of membership," the bulletin continued.

"Title 10 California Code of Regulations 30.51 provides that members must share a common bond 'beyond obtaining financial services.' Stating that 'everyone can join' or that 'all can join' the credit union incorrectly suggests that the common-bond requirement of 30.51 does not apply.

"Please note this regulation when advertising to increase membership and do not use or display any advertisement that is in violation of Title 10 California Code of Regulations 30.51."

The type of credit union campaigns involved were in-branch signage and Internet/Web pages, Alana Golden, California DFI public information officer, told News Now.

"Three credit unions were sent a letter directly, and the bulletin announcement was sent to all licensees," Golden added.

The California regulator became aware of the issue when a DFI employee saw a window advertisement, which then led to Internet searches, she explained.

Two CUNA Events Offer Details On Implementing MBL Programs

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MADISON, Wis. (5/14/13)--The Credit Union National Association will host back-to-back member business lending (MBL) events for a week in late July in Madison, Wis. They are: CUNA Business Lending & Services Conference, July 19-20, and CUNA Business Lending Certification Institute, July 21-25.

The events offer the information and insight to take a credit union from "curious" about MBLs to knowing all the steps and details of program implementation.

"Together, these programs make for an impactful week for credit unions looking to serve their members' small businesses' needs," said Courtney Cantwell, instructional design manager at CUNA. "The Lending Conference and Certification Institute position credit unions to provide the people-first services that members look for in a financial institution."

CUNA Business Lending & Services Conference offers credit union executives and decision makers a chance to determine whether offering member business services is the right decision for their credit unions. Through an overview of the market, advice from experts and experienced credit unions, and an analysis of the current competition, attendees will gain a solid picture of what a member business services program would look like at their credit union.

CUNA Business Lending Certification Institute offers a credit union-specific, week-long curriculum designed by industry experts to increase attendees' business lending potential. The institute features core knowledge, case study analysis in teams and on-site solution building for credit unions' business lending. Expert-led sessions addressing real-life business scenarios leave attendees with a comprehensive understanding of the components involved in lending services, said CUNA.

For more information, use the link.

Forty Certified As CU Development Educators

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MADISON, Wis. (5/14/13)--Forty credit union professionals earned certification as Credit Union Development Educators (CUDEs) last week after being guided by eight program facilitators and mentors through Credit Union Development Education (DE) Training from the National Credit Union Foundation.

Click to view larger image The 40 graduates of the Spring 2013 Development Educator Training stand outside of the World Credit Union Center Campus in Madison, Wis. (Photo provided by The National Credit Union Foundation)
The May 1-8 training was conducted on the University of Wisconsin campus in Madison, Wis.

DE Training provides lessons in cooperative principles and credit union philosophy while incorporating challenges credit unions face today. Participants were involved in group exercises, field trips and issue discussions with speakers from in the credit union system, and were required to complete team projects proposing solutions for credit unions to help alleviate or eliminate challenging situations.

"During DE training, we work to ensure the lessons in credit union philosophy are applicable and relevant to current events," said Lois Kitsch, DE facilitator and NCUF national program director. "For example, for the final case studies, participants worked through and presented solutions to critical issues that included credit union solutions to payday lending, a small-credit union merger dilemma, the low-income designation, building an Islamic banking center, developing a credit union awareness campaign and league consolidation."

For a list of the 40 DE graduates, use the link.

The next DE Training will be held at the Lowell Center in Madison, Wis., Sept. 4-11. Registration still is open. For more information, use the link.

Atlanta Newspaper: Delta Community CU CEO Touts CUs' Service

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ATLANTA (5/14/13)--Delta Community CU's new CEO, Hank Halter, took the opportunity to educate The Atlanta Journal-Constitution readers about the credit union difference, credit unions' structure and service orientation during an interview published in Sunday's edition.

The $4.37 billion asset, Atlanta-based credit union saw record growth in 2012, with a 13% increase--amounting to 30,000 new members-- after big banks imposed new fees or introduced minimum balance requirements, Halter told the publication.

Service is the biggest difference between a credit union and a bank, he said. "Our loyalty isn't divided. We're in business to serve the best interest of our members, period. By the nature of their structure, for-profit banks have to hold something back for the benefit of their investors."

Service and pricing are better at credit unions, Halter  said. "Because we're a not-for-profit organization, we can take a longer view of the customer relationship more easily than for-profit banks. Banks are under a lot of pressure to return higher earnings each quarter. Our employees view themselves as partners and advisers to our members. We look for ways to save them money and direct them to the best options, even if it reduces our revenue."

Credit unions can compete with banks' convenience through ATMs and their shared branch network. Although banks are larger, "credit unions do something banks generally don't do. Credit unions collaborate more freely. Because they're not-for-profit, they pool resources and make joint investments in services and technology that benefit all credit unions," he said.

Although credit unions serve more than 95 million members,  that is just 8% of the market, according to Credit Union National Association statistics cited in the article. "It's mostly a lack of awareness," Halter told the Journal-Constitution. "Many consumers don't know what credit unions are or the benefits we offer."

Raising awareness about credit unions is one of the three-pronged goals-- along with removing barriers and fostering service excellence--of CUNA's and credit unions' Unite for Good campaign to achieve a strategic vision where all Americans choose credit unions as their best financial partner."

To review the full article use the link. Also use the links for more information about the Unite for Good campaign or to find a credit union through aSmarterChoice.org.

CU System Briefs (05/13/2013)

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  • YORKTOWN, Va. (5/13/13)--A Virginia man who pleaded guilty to robbing a Credit Union Service Center in Yorktown, Va., in August, was sentenced to 40 years in prison Thursday, with 25 of those years suspended (Williamsburg-Yorktown Daily and Daily Press May 10). Conway Cook received a harsher sentence than normal because during the Aug. 3 robbery, he allegedly passed a note to a teller, instructing her to keep her hands where he could see them or he would press a button on his cell phone to detonate a bomb. He pleaded guilty to one count of robbery in February. At the sentencing hearing, he told the judge Satan told him now to rob a bank to get money for drug ...
  • DURHAM, N.C. (5/13/13)--The civil and human rights community honored consumer advocate Martin Eakes May 2 with its highest honor--the Hubert H. Humphrey Civil and Human Rights Award--for his work as a champion of economic empowerment for women, low-income, rural and minority communities. Eakes is the co-founder and CEO of Self-Help CU in Raleigh, N.C., which provides consumer financial services, technical support, and advocacy for the economically disadvantaged. Self-Help has invested more than $6 billion in loan financing to female, low-income, minority and rural borrowers. As CEO of Self-Help's Center for Responsible Lending, Eakes has spearheaded the fight against predatory lending practices and is regarded as a leading national advocate for fair lending practices and sound economic policy, said The Leadership Conference website  (civilrights.org April 18) ...
  • MONTPELIER, Vt. (5/13/13)--Ginny Fleischman, president of Green Mountain CU, South Burlington, Vt., has retired after more than 20 years of service with the credit union, the Association of Vermont Credit Unions said (Newslines Express May 10). Fleischman served nine years on the AVCU Board of Directors, including three years as secretary and one year as treasurer. She also served on several AVCU committees. During her years at Green Mountain CU, the credit union grew to $20 million in assets from $3.5 million. Fleischman will stay on with the credit union in an administrative capacity ...

Coordinated Attack Hits N.Y. City ATMs With $45M Breach

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NEW YORK (5/13/13)--An alleged international gang of cybercriminals stole $45 million by hacking their way into a database of prepaid debit cards and then draining ATMs worldwide, federal prosecutors said Thursday.

Eight members of the alleged gang's New York City crew stole about $2.4 million from about 3,000 ATMs in the metropolitan area during February, according to a four-count conspiracy and money-laundering indictment unsealed  in Brooklyn (USA Today May 10).

After reaching out to its member credit unions in the New York City area Friday, the Credit Union Association of New York could not identify any credit unions with ATMs that had been compromised in the attack.

"New York City has a ton small credit unions," said Ron McLean, CUANY senior vice president of support services. "Most of them do not have a lot of ATMs."

The ATMs of Municipal FCU, New York, the largest state-chartered credit union in New York City, do not appear to have been compromised in the attack, Michael Mattone, the credit union's assistant vice president of public relations and corporate communications told News Now.

"We have not been contacted by authorities," Mattone said. "Our security department is double checking to be sure that none of our ATMs were used in the attacks."

The cybercriminals would hack into the computer systems of credit card processors, steal information involving prepaid debit card accounts and eliminate the withdrawal limits and balances of those accounts. Organized crime cells would then withdraw unlimited amounts of cash from ATMs before the operations would be shut down.

Thieves carried out two lucrative unlimited operations between October 2012 and last month, the indictment said. In the first attack, hackers working with the gang on Dec. 22 allegedly targeted a credit card processor that handled prepaid MasterCard debit cards issued by the National Bank of Ras Al-Khaimah, a United Arab Emirates bank also known as Rakbank.

The second unlimited operation allegedly took place between the afternoon of Feb. 19 and the pre-dawn hours of the following day. Hackers allegedly compromised computers of the processor of prepaid debit cards for the Bank of Muscat, located in Oman. In about 10 hours, gang members in 24 countries conducted about 36,000 ATM transactions, withdrawing an rougly $40 million, the indictment said. The withdrawals included $2.4 million by the alleged New York crew.

Two Elected To Maine League Board

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PORTLAND, Maine (5/13/13)--Two elections for the Maine Credit Union League Board of Directors were recently held at the York County and Jeannette G. Morin Chapter meetings, the league said.

The York County Chapter re-elected Luke Labbe, president/CEO of PeoplesChoice CU in Saco, to a new three-year term on the league board (Weekly Update May 10).

Also, the Jeannette G. Morin Chapter elected Roger Sirois, president/CEO of Atlantic Regional FCU in Brunswick, to a three-year term. Sirois replaces Gail Richardson, president/CEO of Midcoast FCU in Bath and a member of the league board since 2000. Richardson is retiring in June.

Both terms will begin following the league's Annual Meeting June 14.

Consolidation Among CUs Continues

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MADISON, Wis. (5/13/13)--Credit union mergers continue to occur nationwide, with smaller credit unions looking to pool their resources through consolidation to better serve members, while others look to garner larger memberships or growth in a specific community or area.

Among the mergers:

  • Cone Drive Gears FCU, based in Traverse City, Mich., with $3.6 million in assets, merged into Traverse City, Mich.-based Members CU with $210.5 million in assets. The recent economic downturn and regulatory pressure from the Dodd Frank Act led to Cone Drive Gears FCU seeking the merger, said Members CU (SNL Bank and Thrift Daily May 1).
  • The $10.4 million asset Brockton (Mass.) Postal Employees CU--the oldest U.S. postal credit union--merged into Brockton-based Crescent CU, with $401.8 million assets, and the new entity operating under the Crescent CU name. The merger will allow both credit unions to garner a more competitive edge amid a time of compressed margins and low interest rates, Crescent said (Banker & Tradesman May 8).
  • Oak Creek, Wis.-based Lakeside CU, with $8.8 million in assets, merged into Educators CU, based in Racine, Wis., with assets of nearly $1.5 billion. Educators' members were looking to get a branch in the Oak Creek area, so the addition of Lakeside fits that need, Educators said (MilwaukeeJournal-Sentinel April 25).
  • Two Houston credit unions, StarTrust FCU, the former Enron employees credit union, will merge with InvesTex CU, effective July1, to achieve competitive advantages and economies of scale, according to the StarTrust website. The merger will create a credit union operating as InvesTex CU, with six branches in the Houston area and more than $170 million in assets, serving roughly 27,000 members.

In The Media: Leagues Stress CU Difference, Tax Exemption

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MADISON, Wis. (5/13/13)--Leagues continue to set the record straight on why credit unions' not-for-profit, cooperative status have earned them their tax exemption. In Oregon and Illinois, where banks are seeking legislation to end that status, leagues have weighed in with opinion-editorials in local and statewide media.

An opinion-editorial by Illinois Credit Union League President/CEO Daniel Plauda, which originally appeared in the State Journal-Register April 24 and was reported in News Now (April 26), has been picked up for coverage by other publications in the state, including the Illinois Times (May 9), and the Belleville News-Democrat (May 8) .

In it, he said taxing credit unions won't save the state's budget deficit and that doing so would "pick the pockets of almost three million state residents who rely on credit unions to provide them with affordable financial services."

Northwest Credit Union Association President Troy Stang, in an opinion article, "Credit Unions are Different--They Value People Over Profits," in the Portland (Ore.) Business Journal (May 3), noted that Oregon banks are pushing a bill "that would impose extra regulatory burdens and expenses on credit unions. If the bill should pass, it could force some credit unions to eliminate services and drive up the costs of others."

Roughly 1.4 million Oregonians are credit union members "because they appreciate better interest rates and personalized service that comes from doing business with local, member-driven, not-for-profit financial cooperatives," he wrote, adding Oregon members saved an average of $152 per household in 2012, or $110 million statewide.

Credit unions pay their members, not stockholders and they "did not engage in the risky, irresponsible big-bank behavior that nearly brought out economy to its needs in 2008 and required tens of billions of taxpayer dollars to bail them out," wrote Stang.

He also cited Voter/Consumer Research that found 90% of Oregonians had a favorable view of credit unions, compared with 53% for banks.  "The poll also found that 82% of Oregonians believed that credit unions, regardless of size, should not be taxed more than they already are, because their cooperative structure allows them to return tangible benefits to members."

A third league president, Patrick La Pine of the League of Southeast Credit Unions, in an op-ed about accepting public deposits in the Orlando Sun-Sentinel, also addressed the attacks on the tax exemption. (See related story, LSCU CEO Sun-Sentinel Op-ed: Let CUs Accept Public Deposits, in today's News Now.)

LSCU CEO Sun-Sentinel Op-ed: Let CUs Accept Public Deposits

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TALLAHASEE, Fla. (5/13/13)--Florida lawmakers should consider legislation to allow credit unions to accept public deposits from municipalities and public offices, Patrick La Pine, president/CEO of the League of Southeastern Credit Unions, wrote Friday in an op-ed in an Orlando, Fla., newspaper, the Sun-Sentinel.

Because such a measure was not considered in the 2013 Florida legislative session, limitations will continue on municipalities and prevent them "from seeking better, more competitive rates of returns for their investments, as well as from establishing a financial relationship with their local credit union, with which they may already have a personal relationship," La Pine wrote.

When credit unions in the state receive deposit requests from local government agencies, the credit unions must deny them because Florida law permits only commercial, for-profit banks to receive those funds, he added.

Banks posit a specious argument that because credit unions "don't pay taxes" the way banks do, they should not be allowed to serve local governments, La Pine wrote. That claim is false because credit unions do pay "tangible property taxes, real property taxes and all employment taxes like a bank," he added.

The reason credit unions are exempt from paying state and federal income taxes is because they have a not-for-profit structure and a mission of serving their communities, La Pine explained.

"Credit unions are 100% locally owned and return all profits back to their Florida membership in the form of lower fees, better interest rates and better returns on deposits. If this good measure to allow credit unions to accept public deposits is not given a fair consideration soon, it's the taxpayers who will continue to lose out," La Pine concluded.

To read the op-ed, use the link.

Several other states allow credit unions to accept public deposits or have considered or are considering legislation. They include California, Illinois, Missouri, New Jersey, New York, Oregon and Washington.

USA TODAY Spotlights CUNA's Student Loan Survey

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NEW YORK (5/13/13)--
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USA TODAY shone a spotlight on the Credit Union National Association's High School Student Borrowing Survey by featuring a graphic of key survey results on the front page of its Money section in Friday's nationwide print edition.

The chart is in the popular "USA Snapshot" space in the lower left-hand column under the heading: I pick 'D. Don't Know' and shows the percentage of students who said "don't' know" when asked these questions about student loans and college expenses:

  • Average student loan rate: 83% didn't know;
  • Student loan duration:77%;
  • Number of loans needed to graduate: 61%; and
  • Expected debt at graduation: 50%.
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The source attribution says: "Source: CUNA survey of 846 teens age 17-18."

CUNA's survey found that half of high school seniors have no idea what college will cost or how debt works and indicates many lack basic financial knowledge, according to Paul Gentile, CUNA executive vice president of strategic communications and engagement.

USA TODAY's chart is another step in generating awareness about the plight of students overloaded with student loan debt when they graduate from college. Student loan debt, which was more than $1 trillion in 2012, is the largest source for consumer debt in the U.S., a fact that has caught the attention of federal agencies such as the Consumer Financial Protection Bureau (News Now April 23).

"Credit unions are a good source to go to for help. They can provide financial education so students better understand the basics and how their decisions on college funding impact their financial future," Gentile noted.  "Credit unions also provide affordable funding with private student loans at reasonable terms," he added.

CUNA and credit unions are urging Congress to permit credit unions to offer longer-term private student loans so students have an affordable alternative. Federal credit unions are limited to loans with maturities of 15 years or less, with certain exceptions such as mortgage loans, by laws that were enacted when the college tuition and other costs were less expensive.

A number of media have reported CUNA's survey findings, including NBC, The Wall Street Journal, Huffington Post and Bankrate.com.

Maine League Testifies On Seven Foreclosure Bills

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PORTLAND, Maine (5/13/13)--The Maine Credit Union League testified on seven foreclosure bills before the State Legislature's Judiciary Committee Wednesday.

The league testified on a bill that would establish a timeframe for mediation, allow for an option for the borrower to out of the mediation program and shorten the redemption period cases where mediation was completed (Weekly Update May 10).

The league helped draft the bill. Testifying on behalf of the league was attorney Ben Marcus, the league's legislative counsel. In his testimony, Marcus said the league believes the bill balances the interests of consumers and lenders by providing reasonable and modest changes to the current system.

Marcus also testified in support of LD 1389, which would expedite the foreclosure process. The changes in the bill would make the foreclosure system more efficient, effective and better able to serve those that need assistance, Marcus said.

Other bills Marcus provided testimony on included:

  • LD 612, which would protect owners of property in foreclosure from accumulating debts when mortagees refuse to complete the foreclosure process;
  • LD 1116, which would amend the attorney's fees provision in foreclosure actions; and
  • LD 784, which would impose penalties for residential mortgage fraud and false representation concerning title;
Another bill, LD 392, designed to protect homeowners and reduce foreclosure fraud, was passed by both the House and Senate before it was vetoed by Gov. Paul LePage. The bill required, upon request, that the original mortgage note be produced for foreclosure proceedings to continue.

"We feel that this bill makes certain that the consumer's interests remain paramount and a top priority throughout the process, while providing the appropriate safeguards to ensure foreclosures are not unreasonably delayed and protects against abuses of the system, Luke Labbe, president/CEO of PeoplesChoice CU, Saco, wrote in testimony submitted on behalf of Maine's credit unions in support of the bill.

The league also testified in opposition to LD 807, also would provide protection to a condominium when a condominium is foreclosed on. The bill had been presented in two previous legislative sessions.

LD 807 would negatively impact the availability and terms of mortgage loans to acquire condominium units throughout the state, Quincy Hentzel, the league's director of governmental affairs, said in her testimony.

National Co-op Bank Names Mercer As Vice Chair

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WASHINGTON (5/13/13)--Michael Mercer, president/CEO of Georgia Credit Union Affiliates, has been elected to a second term as vice chair of the National Cooperative Bank board of directors.

The announcement was made at the annual meeting of the financial services company, which serves  the nation's cooperatives, Thursday in Washington, D.C.

He will be next in line for the board chairmanship after 2013.

Al Plamann, who recently retired as president/CEO of Unified Grocers in Commerce, Calif., was re-elected as president.

The board also welcomed two new members:  Martin Lowery, executive vice president, external affairs of National Rural Electric Cooperative Association, Arlington, Va., and Mary Ann Rothmann, executive director of the New York City Council for Cooperatives.

Mercer was chairman of the Credit Union National Association last year.

NCB's board members represent different industries where cooperative play an important role.

Filene Reports On Immigrants' Needs In U.S., Canada

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MADISON, Wis. (5/10/13)--Serving the immigrant population is a long-term investment that begins with basic financial products, according to a new report from the Filene Research Institute and Credit Union Central of Canada.

Starting basic services may include remittances, check cashing, bill payment, short-term loans, basic checking and saving, and credit cards, said the report, "Financial Services Needs of Immigrant Communities in Canada and the U.S.."

As immigrants' time in a new country increases, their language skills and income often follow suit. The financial products that immigrants require increase in complexity as time goes on, the report said.

The 92-page report includes immigration statistics from the U.S. and Canada and financial institution best practices for reaching immigrant groups.

The report proposed several strategies for effectively serving immigrant populations. They include:

  • Target immigrant groups through segmentation. Immigrants have diverse needs based on originating country, tenure in North America, immigration, geographic area and other factors. Credit unions must use their resources wisely by selecting specific immigrant groups to focus on and communicating in a way that resonates with them.
  • Learn from successful programs. By conducting a deeper analysis of programs for immigrants and analyzing the quantitative results--such as those offered in the report--credit unions can determine winning strategies that not only build trust within the immigrant community but also yield a positive return on investment.
  • Enable immigrants to work with the credit union. With nearly 10 million Americans lacking traditional credit scores, alternative methods for determining an individual's credit risk are needed, the report said. One of the most common alternatives is collecting and analyzing data from sources such as rental and bill-payment history, insurance payments, debit card use, and public records.
To download the report, use the link.

Facebook or LinkedIn? For Financial Pros, It Depends

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NEW YORK (5/10/13)--While Facebook remains the most popular overall social network for personal use, LinkedIn's focus on business makes it the top platform for work-related issues--especially in the world of finance, according to new research.

Social media platforms had a penetration of 90% among financial professionals, according to a first quarter survey of finance professionals by Research Now and American Century Investments  (eMarketer.com May 9).

"In the finance world, knowledge is currency," said the research report. "And financial professionals seem to understand that staying tapped into their social networks is a great way to stay on top of the latest information."

One-third of those surveyed said they used LinkedIn only for business. That compares with 2% for using Facebook for this purpose and 3% for Twitter.

The financial pros reported they most often turned to social media to read up on commentary and expert insights about the finance world (28%).  Other popular functions included researching people (prospects, contacts and current clients), at 14%, and sharing relevant news content with their clients, 13%.

Other business uses for social media included monitoring industry/market news (11%) and business promotion or brand building (10%).  Receiving fewer than 6% were: maintaining a professional blog, posting commentary, sharing best practices with peers and colleagues, customer feedback/engagement and competitive intelligence.

Roughly 40% of those surveyed said they use social media several times a week, an increase from 31% the previous year.

For social media used for personal purposes, Facebook got the lion's share--55%--followed by Twitter at 21%, YouTube at 20%, Google+ at 14% and LinkedIn at 12%.

NCUA Asks Court To Reconsider Goldman Sachs Ruling Or Certify Appeal

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LOS ANGELES (5/10/13)--The National Credit Union Administration Wednesday asked a federal court hearing its residential mortgage-backed securities lawsuit against Goldman Sachs in Los Angeles to reconsider that court's dismissal of certain claims or certify the  ruling for interlocutory appeal to a higher court.

U.S. District Court of the Central District of California--Western Division Judge George Wu on Sept. 4 had dismissed several claims that NCUA made against the bank, ruling that the statute that allows for extension of the time period for filing a suit "does not apply to "statutes of repose" because the statute uses the phrase "statute of limitations." That meant NCUA did not file the suit within the period allowed for several of the securities certificates  in question.

However, Congress provided that "'the statute of limitations with regard to any action brought by the board as conservator or liquidating agent shall be' at least three years from 'the date of the appointment of the board as conservator or liquidating agent,'" said NCUA's motion for reconsideration.

NCUA cited new contrary rulings by other federal courts hearing similar lawsuits brought by the agency against Wall Street banks and seeking recompensation for losses related to the securities sold to several corporate credit unions. The losses led to the conservatorship of those corporates. NCUA filed the suits in its role of liquidating agency for U.S. Central FCU and Western Corporate FCU.

In its motion, NCUA maintained that the U.S. Court of Appeals for the Second Circuit recently issued a contrary ruling that said, "although the statutes of limitations and statutes of repose are distinct in theory, the courts--including the Supreme Court and this court--have long used the term 'statutes of limitations' to refer to statutes of repose."

In addition, the agency noted that courts in the Second Circuit, Southern District of New York, District of Kansas and the Central District of California "have disagreed with this court's interpretation of the language," according to the document filed in court.

"NCUA respectfully submits that the reasoning of these courts is persuasive, and on that basis, seeks reconsideration of this court's prior ruling that" the law does not displace statutes of repose. "In the alternative, NCUA asks this court to certify that question for interlocutory appeal," the document said.

N.C.- S.C. League Boards Recommend Consolidation

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COLUMBIA, S.C., and RALEIGH, N.C. (5/9/13)--The boards of directors of the South Carolina Credit Union League and North Carolina Credit Union League voted Thursday to recommend  consolidating of the two leagues, continuing a trend of collaboration among state associations.

The votes, made in independent meetings, acknowledge that the resulting league would be stronger and better positioned to serve credit unions in the Carolinas for years to come, said the leagues.

If the consolidation is approved by the leagues' members, it could be the second consolidation of leagues this year.  Members of the Credit Union Association of Oklahoma are set to vote next week on a proposed merger with the Texas Credit Union League and the Arkansas Credit Union League. Texas and Arkansas credit unions already have approved that consolidation into what would be called Cornerstone Credit Union League (News Now April 4).

The Carolina leagues had announced in December that they were considering a merger (News Now Dec. 7).

The new league would draw financial strength and stability from a broader base of credit unions to serve, a solid equity position, and league service corporations with track records of success.  Consolidating staff from both organizations would allow the new league to enhance its delivery of core association services: advocacy, compliance and professional development.

"Our board sees great promise in bringing together these two leagues," said NCCUL Chairman Maurice Smith.  "Consolidation provides clear value and sets us on a path to successfully meet the changing needs of credit unions in the Carolinas."

Each league will share details with its member credit unions in May and June. Final membership votes in each state are expected by September with a proposed effective date of Jan. 1 for the new league.

"Our board has concluded that a consolidated league creates a financially strong organization that can deliver powerful and effective advocacy in Columbia, Raleigh, and Washington, D.C., for years to come," said SCCUL Chairwoman Faye Crocker.  "We are excited about this opportunity and look forward to sharing more about our vision for the new league with credit unions in the coming weeks."

CU System Briefs (05/10/2013)

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  • WASHINGTON (5/10/13)--About 20 guests attended an informal luncheon for  U.S. Sen. Heidi Heitkamp (D-N.D.)  Wednesday at the Credit Union House in Washington, D.C. , said the Credit Union Association of the Dakotas (The Memo May 9). The event, hosted by the Credit Union National Association,  attracted advocates from credit unions, MasterCard, realtors and agricultural and insurance interests, including CUNA Mutual Group. Heitkamp spoke about the progress of the Farm Bill, tax reform, financial regulatory concerns and the privacy notification bill being considered by the Senate Banking Committee.  Pictured are, from left:  Heitkamp; Mechelle Johnson, president of East River FCU, Madison, S.D.; and Jeff Olson, CUAD's vice president of advocacy and awareness. (Photo provided by the Credit Union Association of the Dakotas) ...
  • JACKSON, Mich. (5/10/13)--Roger Ozier, 60, was convicted last week of the armed and bank robbery at Jackson, Mich.-based Aeroquip CU on Oct. 8 and fleeing with nearly $4,000.  A co-defendant, Darius Griffin, also charged with armed and bank robbery, pleaded guilty and testified at the trial.  A surveillance camera at a car wash down the street from the credit union allegedly showed Griffin removing a car's license plate and placing a fake license in the back window. Ozier was allegedly seen disposing of a bag that contained a draft of a faked plate. Nearly all the events leading up to, during and after the robbery were caught on tape. Jurors deliberated less than two hours. Ozier's sentencing is set for June 12 (Jackson Citizen-Patriot May 1) ...
  • ALBANY, N.Y. (5/10/13)--Covera, a provider of debit, credit and ATM solutions for credit unions, on the 2013 Communicator Award of Distinction for four projects. The Communicator Awards is an international program to recognize achievements in communications, media, advertising, creative and marketing. Sanctioned and judged by the International Academy of Visual Arts , the program received over 6,000 entries. Covera won the awards for its new website, copywriting for its corporate brochure, copywriting for its values brochure and for its "Right Hands" print advertisement.  It won the print and website categories for strong visual appeal, logos and content ...
  • ROLLA, Mo. (5/10/13)--Scott Shults has been named as president of Rolla (Mo.) FCU, succeeding Janet Honse, who retired in March.  Shults previously was vice president and branch manager of a community bank in Salem. He has 10 years of experience in the financial services industry, primarily in residential and commercial lending. Rolla has $33 million in assets (The Rolla Daily News May 8) ...
  • LULING, La. (5/10/13)--The board of directors at Luling, La.-based Barton Plant Employees FCU has promoted Lindsay Risinger to CEO of the $18 million asset credit union, according to the Louisiana Credit Union League eNews May 8). Risinger, who previously served as assistant manager, has eight years' experience in credit unions.  In addition to her new role, Risinger also is vice president of the West Orleans Chapter and is a member of Louisiana's Young Professionals Network ...

SECU's Youth Members Saved $3.15M in One Week

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RALEIGH, N.C. (5/10/13)--Young members of State Employees' CU (SECU), Raleigh, N.C, opened 612 youth accounts and deposited $3.15 million during the credit union's Youth Saving Challenge, April 22-26.

SECU was celebrating the "Stache Your Cash" theme of National Credit Union Youth Week, sponsored by the Credit Union National Association. SECU challenged the credit union's young Fat Cat and teen Zard members to "stache" a deposit into their share account during youth week.  Participating accountholders were automatically entered into a random drawing for a Nook HD Tablet, with one FAT CAT and one Zard winner. 

Staff at $26 billion asset SECU's 248 branches promoted the campaign with displays and visited local schools to teach financial education concepts. 

"The Youth Saving Challenge event is a great way to communicate and motivate young children to learn about the importance of saving," said Kevin Watson, vice president of SECU's Dunn branch. "The branch employees and FAT CAT, our youth mascot, have fun promoting the branch event with SECU's young members and their families and enjoy sharing the knowledge of basic money concepts through local school and community presentations."

News Now will publish the nationwide results of the Credit Union Youth Saving Challenge May 20.

The Youth Week activities also make youth--and their parents--aware of the benefits of credit unions. CUNA sponsors National Credit Union Youth Week to help credit unions nationwide focus on the financial needs of young people and provide financial literacy education. It teaches the benefits of saving and goal setting, and invites youth to open savings accounts at their credit union--and make deposits throughout the year.

Raising awareness about credit unions is one of the steps in CUNA's, leagues' and credit unions' Unite for Good campaign to achieve the vision of Americans choosing credit unions as their best financial institution. As that awareness grows, potential members will turn to aSmarterChoice and Unite for Good websites to locate credit unions they can join and find out more.

Mich. CUs, Lawmakers Team Up For Financial Literacy

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LANSING, Mich.  (5/10/13)--In Michigan, 41 lawmakers signed up to participate in a Financial Literacy Legislative Challenge and joined credit unions statewide for youth financial education events in April, which was Financial Literacy Month, according to the Michigan Credit Union League.

While it is often a challenge to coordinate financial education events to fit both the schools' and the legislators' schedules, participating credit unions understand the importance of the cooperative partnership and worked to schedule and present many events this spring, MCUL said (Michigan Monitor May 6).

Mich. State Rep. Andy Schor (D-Lansing) assists students at Lansing Sexton High School during a "Reality Fair" conducted by CASE CU in Lansing.
Mich. State Rep. Peter Pettalia ( R-Presque Isle) and Missy Cordes of Alpena Alcona Area CU in Alpena talked to two senior classes at Alcona High School April 29 about student loans and using credit cards wisely.

CASE CU in Lansing teamed with state Rep. Andy Schor (D-Lansing) at J.W. Sexton High School on April 19, where students learned real-world money-management skills during a "Mad City Money" reality simulation.

Also participating was Rep. Anthony Forlini (R-Harrison Twp.), who presented at Iroquois Middle School in Macomb Township.

CEO John Buckley of Gerber FCU in Fremont, Mich., and Mich. State Rep. Jon Bumstead (R-Newaygo) discuss money management with students at Fremont High School. (Photos provided by the Michigan Credit Union League)
"Financial education is important no matter what the age and I am thankful that the MCUL supports this message," said Shannon McIntosh, consumer education specialist at Michigan Schools and Government CU in Clinton Township. "It's a wonderful opportunity to be partnered with a local lawmaker."

Forlini and the credit union spoke with three eighth grade classes on the importance of money management.

State Rep. Colleen LaMonte (D-Montague) visited the Muskegon Area Career Tech Center with Sheryl Hogle, director of financial education at HarborLight CU in Whitehall, to participate in the challenge. Financial management/accounting students at the center run their own credit union, The Currency Corner.

State Rep. Jon Switalski (D-Warren) visited a financial literacy class at Fitzgerald High School in Warren. Switalski believes in the value of financial literacy education for all youth, but especially at the high school level, MCUL said. After talking to students, he answered questions about financial literacy and state government and the impact on their lives.

Many questions from students related to college funding, cuts in education programs and the high cost of college and charter schools. Switalski encouraged them to contact the governor, their state senator and himself regarding issues important to them. He also encouraged them to register to vote and exercise that right.

Caution On Twitter Account Impersonating a CU

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ROCHESTER, N.Y. (5/10/13)--A Twitter account has been found to be impersonating a credit union.

As of Wednesday there was an active Twitter account that claimed to be St. Pius X Church FCU in Rochester, N.Y., Gregory Hurley, editor of Credit Union Online, said in a column Wednesday.

A visit to the account (@SPXFCU) Thursday by News Now revealed no tweets on the account.

The account displayed the $70 million asset credit union's logo, with a link to its website and phone number. When Hurley visited the credit union's website, he didn't find any links to a Twitter account so he called St. Pius X Church FCU, and verified the Twitter account was not associated with the credit union.

Hurley listed some best practices before following a credit union  on Twitter:

  • Do not use Twitter's search feature to look for a credit union.
  • Members should visit their credit union's website and look for a link to its official Twitter account.
  • If members see an account that is impersonating their credit union, they should  contact the credit union and report it.
To report impersonations on Twitter accounts, credit unions should use the link below.

The Credit Union National Association recommends that consumers use aSmarterChoice.org to find a credit union they can join. aSmarterChoice.org is a joint project of CUNA and the American Association of Credit Union Leagues. It is aimed at helping create consumer awareness of credit unions and building membership.

League Of S.E. CUs Nets Seven Hermes Creative Awards

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BIRMINGHAM, Ala. and TALLAHASSEE, Fla. (5/10/13)--The League of Southeastern Credit Unions and Affiliates received seven Hermes Creative Awards for concept, writing and design of traditional and emerging media.

Hermes Creative Awards is an international competition, administered by the Association of Marketing and Communications Professionals, for creative professionals involved in the concept, writing, and design of traditional and emerging media.

The league received three top Platinum Awards, two Gold Awards and three Honorable Mentions.

The LSCU Cooperative Image Campaign "Coffee" TV ad, Signal magazine, and its John M. Floyd and Associates Direct Mail piece were awarded Platinum Awards, recognizing their quality, creativity  and resourcefulness. Only 15% of the entries received the top Platinum Award.

This is the third year in a row Signal magazine was recognized with a Platinum statue.

A Credit Union Service Centers of Alabama video and the Leadership Development

Conference Campaign received Gold Awards.

Honorable Mention acknowledgments went to the Florida Governmental Affairs Conference Direct Mail piece and the LEVERAGE website.

FBI: Phish Attacks Target Telecommunication Customers

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WASHINGTON (5/10/13)--The Internet Crime Complaint Center (IC3) is reporting that phishing attacks are targeting telecommunication companies' customers in an attempt to get personal information for possible use in frauds and identity theft, said the Federal Bureau of Investigation.

Credit unions can warn members that individuals are receiving automated telephone calls claiming to be from the victim's telecommunication carrier. Victims are directed to a phishing site to receive a credit, discount or prize ranging between $300 and $500.

The site duplicates the legitimate carrier's site and asks for log-in credentials and the last four digits of the victim's Social Security number.  Once they enter the information, the victims are redirected to the telecommunication carrier's actual site. The perpetrators then make changes to the customer's account.

Credit unions can urge members to be cautious of unsolicited telephone calls, e-mails and text messages that promise compensation for supplying account information.  Anyone receiving an offer should verify it with the legitimate business by using the information on the account statement.

Credit unions can also remind members that the credit union never will solicit account or financial information over the phone or via e-mails.

CU System Briefs (05/09/2013)

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  • TACOMA, Wash. (5/9/13)--Four people, including a credit union employee, received minor injuries when a car at the drive up station at Tacoma, Wash.-based Harborstone FCU's South Hill branch crashed into the credit union building. Injured were the employee, who was in the lunchroom; the 65-year-old woman driving the car; a 61-year old passenger and an eight-month-old boy, also a passenger. The driver said she hit the brake, but the car accelerated and plowed into the building at about 1:45 p.m. Monday (The News Tribune May 7) ...
  • MINNEAPOLIS (5/9/13)--Mark Edward Wetsch, 49, Minneapolis, a suspect in the robberies of 31 credit unions and banks in the past two years, pleaded guilty Monday to five holdups. He pleaded guilty last month to a sixth robbery, said the Minnesota U.S. Attorney's Office (Minneapolis/St. Paul Business Journal Online May 7). He allegedly held up Richfield-Bloomington CU, Richfield, twice but left empty handed. He wore a black mask and black hoodie, and allegedly stole $110,000 using a toy gun.  The last robbery by the "Man in Black" was in January 2012 ...
  • FLINT, Mich. (5/9/13)--A federal judge has ordered the former head teller of Security CU, Flint, Mich., to pay nearly $70,000 in restitution after she pleaded guilty to embezzlement. U.S. District Judge Mark A. Goldsmith also sentenced Jody Kravat to serve one day in jail and three years of supervised released in a judgment filed May 2.  Kravat pleaded guilty Jan. 9. While employed at the credit union's Burton, Mich. branch, she ordered currency from the Federal Reserve, then counted and secured the money when it was delivered. She allegedly admitted to removing 698 $100 bills from the credit union's vault and replacing them with $1 bills during 2011 (mlive.com May 7) ...
  • HAMPTON, Va. (5/9/13)--A U.S. Army staff sergeant accused of robbing a York County branch of the Hampton, Va.-based Langley FCU was denied bond Wednesday in Circuit Court.  Staff Sgt. Dorman Shaw is charged with robbing the credit union April 6 by allegedly passing a note to a teller demanding $4,000 and raising his shirt to indicate he had a hand gun in a side holster. The note also said the robber had an accomplice outside and that the teller should not press the panic button because he had worked in a bank and knew financial institutions' procedures, said Poquoson Commonwealth Attorney Ben Hahn. The sported a fake scar on his face and wore a wig and Virginia Tech hat.  He fled with an undisclosed amount of cash. After the heist, police spotted Shaw near the credit union, gave chase and apprehended him. Police found a wig, a Virginia Tech hat, a toy pistol resembling a .45-caliber Smith & Wesson handgun, some Langley FCU deposit slips and a note similar to the one in the robbery (Williamsburg Yorktown Daily May 8) ...

NEW: North and South Carolina League Boards Vote To Consolidate

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COLUMBIA, S.C., and RALEIGH, N.C. (Filed at 4:50 p.m. ET 5/9/13)--In independent meetings held today, the boards of directors of the South Carolina Credit Union League and North Carolina Credit Union League voted to recommend that member credit unions in both states approve consolidation of the two leagues.

The votes acknowledge that the resulting league would be stronger and better positioned to serve credit unions in the Carolinas for years to come, said the leagues.

The new league would draw financial strength and stability from a broader base of credit unions to serve, a solid equity position, and league service corporations with track records of success.  Consolidating staff from both organizations would allow the new league to enhance its delivery of core association services: advocacy, compliance and professional development.

"Our board sees great promise in bringing together these two leagues," said NCCUL Chairman Maurice Smith.  "Consolidation provides clear value and sets us on a path to successfully meet the changing needs of credit unions in the Carolinas."

Each league will share details with its member credit unions in May and June. Final membership votes in each state are expected by September with a proposed effective date of Jan. 1, 2014 for the new league.

"Our board has concluded that a consolidated league creates a financially strong organization that can deliver powerful and effective advocacy in Columbia, Raleigh, and Washington, DC for years to come," said SCCUL Chairwoman Faye Crocker.  "We are excited about this opportunity and look forward to sharing more about our vision for the new league with credit unions in the coming weeks."

Co-op Directive Seeks CUs To Mentor Young Leaders

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BERKELEY, Calif. (5/9/13)--The Cooperative Food Empowerment Directive (CoFED) is looking for credit union employees to mentor college students who work with food cooperatives.

Mentors will work with projects on campuses in the Northeast, Mid-Atlantic, Midwest, Pacific Northwest and California, connecting with students and creating opportunities to expand their younger membership.

Mentors will support small local businesses and connect with the greater co-op community while supporting young leaders as they build a cooperative food movement on college campuses.

Since its national launch in Fall 2010, CoFED has worked with more than 200 students starting or operating cooperative, sustainable food ventures on their campuses.

In August, CoFED will launch a training program for people in the food and cooperative movements. It will recruit six future food movement leaders for an immersive professional development experience. The fellows will support hundreds of students who grow cooperative and sustainable food businesses on their campuses. 

CoFed noted that fellows need expert help from credit union mentors in financial literacy, financial management, and general business development. The time commitment is two hours per month consisting of 20- to 30-minute calls or e-mails with teams and/or regional organizer fellows.

CoFED will feature mentor credit unions on its website. Use the link. Mentors also will have networking opportunities with students and local business partners. 

For more information, e-mail megan@cofed.org

Websites Defaced, But No Action So Far Vs. U.S. CUs

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MADISON, Wis. (5/9/13)--While some websites overseas experienced defacements by hacktivists Tuesday, the 133  U.S. credit unions and banks on an OpUSA list of targets were unaffected--as of early Wednesday afternoon--by distributed denial of service (DDoS) attacks that groups had threatened to  unleash "on or about" Tuesday.

However, credit unions--even those not on the list--took precautions to make sure they were prepared and Wednesday they were still monitoring their websites.

One credit union not on the hit list--SRP CU, a $635 million asset credit union based in North Augusta, Ga.--told local media that it shut down its online services for about 24 hours to protect its members' confidential information. It had its information technology department on high alert and used onsite tools as well as a third party to monitor activity (wrdw.com May 7).  A member who was interviewed took the inconvenience in stride, noting that protecting members' information was important.

Wright-Patt CU, Fairborn, Ohio--also not on the target list--monitored its online traffic throughout Tuesday for signs of any cyberattack. The credit union prepares for such events regularly and has internal processes to address any issues, Tracy A. Fors, WPCU's vice president of marketing and business development told the Dayton Daily News (May 7).

Twelve credit unions, as well as a handful of government agencies and 121 banks, were among those on the target list posted on PasteBin by the hacker group Anonymous.  The credit unions  reported no slowdowns but were continuing to monitor traffic on their websites. The Federal Bureau of Investigation--whose site was among the agencies targeted--said the threat  alert of possible DDoS attacks would continue into today.

Instead of DDoS attacks in the U.S., what materialized on Tuesday was a series of defacements of what USA Today (May 7) termed as "random government and commercial websites" around the globe.  Most of the sites defaced have no connection to the U.S., and were in Europe, South America and China.

Corero Network Security told the publication that it appears that hacktivists focused on smaller websites that have fewer resources and may be more easily compromised. Although there was no significant impact on the financial services industry, even nuisance attacks are costly with companies devoting more technical resources to monitoring suspicious activity.

On Tuesday, Information Week noted that al_Qassam Cyber Fighters, an organization responsible for a number of DDoS attacks disrupting financial websites--including credit unions--for months, had promised to take this week off  its own cyberactivities so it wouldn't duplicate the Anonymous efforts.

Court: CU Can Subpoena 3rd Parties On Phish Attacks

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COLUMBIA, S.C. (5/9/13)--A federal court in Columbia, S.C., has granted a credit union's motion for expedited discovery, allowing it to subpoena third parties to learn the identity and whereabouts of people using the credit union's name in a text-message SMS phishing scam.

In its suit against the unknown "John Does and Jane Does," filed April 17 in the U.S. District Court for the District of South Carolina, Columbia division, AllSouth FCU seeks information from third party Internet Service providers that are not considered part of the scam.

The Does conduct SMS phishing scams directed at consumers with telephone and cell phone numbers in the 803 area code and use Columbia-based AllSouth's identity in the messages. In its motion, the credit union said efforts to obtain the identities of the phishers were unsuccessful, but with discovery tools and subpoenaed documents it could learn identities and prevent further fraud.

The credit union began receiving notifications around April 4 from members and nonmembers who received SMS text messages indicating their account with the credit union had been restricted. The recipients were told to call a number to remove the restriction. Upon calling they were directed by a digitized automated recording to provide a member number, account number and other personal information, including Social Security number and driver's license number.

Since then, AllSouth has spotted suspicious activity on multiple members' accounts. More than 125 members reported they had revealed personal data.

The credit union has identified five Internet Provider addresses used in the scam, said the court documents.

The suit alleges infringement of registered trademarks, federal unfair competition, false designation of origin and false advertising, dilution of a famous mark, service mark counterfeiting, racketeering under the Racketeer Influenced and Corrupt Organizations Act, and violation of the South Carolina Common Law Unfair Competition.

NCUA To Appeals Court: Bailout Law Overrides Deadline Statutes

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DENVER (5/9/13)--Attorneys for the National Credit Union Administration and for RBS Securities and Wachovia Capital/Wells Fargo made their arguments Wednesday morning before an appeals court in Denver, which will decide key issues involving the statute of limitations in  NCUA's lawsuits over residential mortgage back securities (RMBS) the banks sold to corporate credit unions.

At issue is whether powers granted to financial industry regulators by Congress in the Financial Institutions Reform, Recovery, and Enforcement Act  of 1989 (FIRREA) would allow a three-year extension of time beyond the statute of limitations for securities claims--allowing NCUA more time to file lawsuits in the securities cases, including suits against RMBS Securities and Wachovia.

NCUA in a number of lawsuits against big banks and securities dealers alleges that the companies misled corporates into investing in RMBS products that generated billions of dollars in losses and caused the corporates to collapse.

The banks allege the lawsuits weren't filed within the proper statute of limitations and statute of repose filing times of one year and three years.

NCUA maintained in its brief--filed by David C. Frederick, an attorney with Kellogg, Huber, Hansen, Todd, Evans & Figel PLLC law firm in Washington, D.C., on March 1--that FIRREA displaces both the one-year and three-year periods. NCUA's brief notes that Congress passed FIRREA "in response to a major financial crisis: the mass failures of savings-and-loan associations in the late 1980s."

FIRREA, said the brief, provides "federal agencies acting as conservators, receivers, and liquidating agents with at least three years to investigate, evaluate, and if necessary pursue the claims on behalf of failed institutions, and further intended that these special provisions should be construed broadly to maximize recoveries by those federal agencies."

The decision by the Court of Appeals for the Tenth Circuit would have ramifications for several other cases that NCUA has brought against a variety of Wall Street banks and securities dealers. Those suits also involve the statute of limitations issue.  Recently a U.S. District Court judge in Kansas stayed eight NCUA lawsuits, pending the appeals court's decisions in the RBS Securities/Wachovia consolidated case (News Now May 1).

Federation Launches Co-op Fellowship For CUs

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NEW YORK (5/9/13)--The National Federation of Community Development Credit Unions is launching a pilot program to cultivate future leaders for the credit union movement. Completed applications for both the fellows and participating credit unions are due May 29.

The Cooperative Finance Leaders for America (CFLA) will recruit, train and support 15 professionals for leadership positions in credit unions dedicated to providing credit and safe financial services to low- and moderate-income communities. 

Participating credit unions will gain a source of staff drawn from recent college graduates, graduate students, returning veterans and displaced financial workers, the federation said. The  paid fellowship is for six months.

The CFLA's training program will include a two-week summer institute (one week in person and one week online) in August and ongoing support throughout the fellowship.

Also, CFLA alumni will receive long-term support, aimed at their becoming the next generation of credit union CEOs and leaders. All fellowships will begin in September and continue through February.

For more information, use the link. 

For questions, contact Pamela Owens, vice president of programs at 212-809-1850, ext. 215, or powens@cdcu.coop, or Jason Chang, program associate at ext. 205 or jchang@cdcu.coop.

CUNA Trainers To Present Generation-Tailored Mobile Learning

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MADISON, Wis. (5/9/13)--Two of the Credit Union National Association's professional development experts, Kevin Smith and Marlo Foltz, will present a session on generation-tailored mobile learning at the 2013 Mobile Learning Conference & Expo, June 18-20 in San Jose, Calif.

The conference, hosted by the eLearning Guild, informs attendees of the benefits, pitfalls and recent advances in mobile education delivery.

The session, "Assumptions Gone Awry: Mobile Learning for Baby-Boomers and The Silent Generation," will address CUNA's solutions to generational education constraints amidst quickly accelerating technological advancement. Participants will receive insights into CUNA's success with tailoring mobile learning for credit union board members by combining "old-school" training content with newer, more accessible delivery formats.

"Today's rapid advances in technology put more and more power into the hands of the adaptive younger generations," Smith said. "But within the credit union movement and a number of other industries, the traditionally technology-resistant generation still calls the shots. We need to acknowledge their needs as an industry."

While the majority of the conference's content is presented by professionals who have produced successful results for their organizations, Smith and Foltz said they believe ideas beneficial to the industry as a whole are the most worthwhile investment. They designed training programs and techniques to drive trends of positive change in the credit union movement.

"You can invest time and innovation within your company and you'll see results, but your success can only progress within the limits of your industry," said Foltz. "We're looking at the big picture."

As CUNA's director of volunteer education, Smith develops and oversees training and education for directors and supervisory committee members of more than 7,000 credits unions in the U.S.

Foltz is CUNA's director of blended learning, and she develops and implements training and certification programs for credit union employees, executives and volunteers.

Baltimore Raven To Share Co-op Spirit At Federation Confab

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NEW YORK (5/9/13)--Saying the cooperative spirit is what has made a real difference in his life, Baltimore Raven Michael Oher, who was the inspiration for the Academy Award-winning movie "The Blind Side," will appear at the annual National Federation of Community Development Credit Unions conference, June 5-8 in Baltimore.

"The federation's annual conference is a great opportunity for me to meet the people who are committed to bettering lives through community development credit unions," Oher said.

The event will be the nation's largest gathering of credit unions dedicated to community development, the federation said. It will offer strategies, ideas, partnership opportunities and practical solutions for connecting low- and moderate-income Americans to high-quality financial services.   

"Mr. Oher has such an uplifting story to share about perseverance and commitment," said federation President/CEO Cathie Mahon. "His life experience will resonate deeply with conference attendees and energize their commitment to serving their communities nationwide."  

The federation represents more than 250 community development credit unions that serve more than 2.2 million residents of low-income urban, rural and reservation-based communities nationwide.

For more information, use the link.

Wiemert Appointed Conn. League Interim CEO

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MERIDEN, Conn. (5/9/13)--The Credit Union League of Connecticut Board of Directors Wednesday announced the appointment of Keith Wiemert as interim president/CEO, effective immediately.

Wiemert is league board chair and president/CEO of Seasons FCU in Middletown.

Also, the league board has appointed a search committee for a permanent replacement for Tony Emerson, who has accepted a position at a Massachusetts credit union following five-and-a-half years of Connecticut league leadership.

The committee has met and devised a strategy for moving forward, the league said.

Michigan DIFS Hosts Meetings For Small CUs

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LANSING, Mich. (5/8/13)--The Michigan Credit Union League and the state Department of Insurance and Financial Services (DIFS) are hosting meetings around the state for credit unions with assets under $5 million to discuss a range of issues (Michigan Monitor May 6).

Among the topics are a credit union's board and fiduciary responsibility under the Michigan Credit Union Act, regulatory and legal implications for the board of directors, the purpose of the examination process, new regulations from the National Credit Union Administration and the Consumer Finance Protection Bureau, the Bank Secrecy Act and examiner hot topics.

Two meetings were held in April and were hosted by Public Service CU, Romulus, and Educational Community CU, Kalamazoo, said the league.  Meetings in the northern part of the state will be held May 29 at Filer CU, Manistee, and June 7 at UP Catholic CU, Marquette.

DIFS regulates state-chartered credit unions.

CU System Briefs (05/08/2013)

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  • KYLE, S.D. (5/8/13)--U.S. Sen. Tim Johnson (D-S.D.) attended the grand opening and ribbon cutting Friday of Lakota FCU on the Pine Ridge Indian Reservation of South Dakota.  "People should be proud of the role that the credit union is playing in the Pine Ridge economy," said Johnson. "Everyone deserves to have access to an insured financial institution, and this credit union can be another piece of the puzzle for this community." Credit unions from around the Black Hills, S.D., area and the Credit Union Association of the Dakotas  joined the celebration to show their support (The Memo May 7). Shown are employees and board members from Highmarck FCU, Northern Hills FCU, Dakota Territory FCU, Sentinel FCU, Rapid City Telco and Black Hills FCU, and CUAD staff in front of CUAD's "CU on the Road" vehicle. Manager of the new credit union is Whitney O'Rourke (Photo provided by the Credit Union Association of the Dakotas) ...
  • CHICAGO (5/8/13)--U.S. Rep Jan Schakowsky (D-Ill.), left, visited Algonquin Middle School in Des Plaines, Ill., May 1 to observe a class on checking and savings accounts, according to Alliant CU in Chicago. The class is part of a four-course curriculum called Banking on Our Future, which teaches the basics of banking and the importance of credit and investment. The financial literacy classes are taught by trained employee volunteers from the $8.27 billion asset Alliant CU, which is headquartered nearby. Schakowsky praised the concept of teaching youth about money matters. The classes occur quarterly during the school year for eighth graders at Algonquin and Chippewa Middle Schools. As a former elementary school teacher, Schakowsky has a strong commitment to education, Alliant CU said. (Photo provided by Alliant CU) ...
  • ONTARIO, Calif. (5/8/13)--CU Direct Corp., which provides lending solutions to credit unions, has been recognized by the National Association of Credit Union Service Organizations (NACUSO) with the 2013 NACUSO Collaboration and Innovation Award. CU Direct Corp. was recognized for its leadership in innovation and collaboration. The Collaboration and Innovation Award showcases the credit union or CUSO that exhibits leadership using the CUSO collaborative model to deliver value to the credit union and its members. The award was presented during NACUSO's annual conference in Las Vegas ...

Security Service FCU launches new ad campaigns

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SAN ANTONIO, Texas (5/8/13)--Security Service FCU, San Antonio, Tuesday launched two advertising campaigns: One targeting bilingual, bicultural members and a second focused on what great member service feels like.

The campaigns include television and radio spots and billboards showcasing expected and unexpected humor in life.

In the bilingual campaign, a father of the bride laments in Spanish that the cake his daughter wants "is bigger than my first house, the guest list is the phone book, and people are allergic to food--so we're serving every food." A Security Service teller reassures him in English, "You've planned and saved smart for this wedding. Everything's going to be fine." She then expresses her condolences that she won't be able to attend, prompting the gentleman to grasp her hands and say in English, "Bless you."  .

In a second ad, a harried mom sitting in her minivan at the Security Service drive thru reflects on a recent date night with her husband, complete with flowers, champagne and "not a single chicken finger." A Security Service teller tells her she "can make it" until the next weekend's date, sending her some wet wipes through the pneumatic tube to mop up a drink hurled at her from the back seat.

The second series focuses on conveying the unexpected joy of being on the receiving end of great member service. Each ad begins with a Security Service spokesman trying to explain the credit union's great service: "Service isn't something you hear," he says. "It's something you feel."

One spot in the campaign then cuts to a child's birthday party. The birthday boy swings at a large pinata hanging from a tree in the backyard. But instead of candy falling out, a shiny, new pickup truck drops to the ground.

Another ad cuts to a scene of average-guy Gary approaching a romantic restaurant to meet Veronica, an out-of-his-league, website-made match. Slow music plays as Gary meets the tall, friendly beauty. She smiles and utters a line that no online dater who has had a brush with reality has ever heard: "Your profile picture doesn't do you justice, handsome."

"Yep, feels like that," each commercial concludes, cutting quickly back to the Security Service spokesman. The spot ends with the tagline: "Feel how banking's supposed to feel. Feel it for yourself, at Security Service FCU."

Fostering great member service is one of the three-pronged goals aligned with the Credit Union National Association's strategic vision for credit unions where "Americans choose credit unions as their best financial partner." For more information about the Unite for Good campaign toward this vision, use the link.

The ads are scheduled to air in three states: Texas, Colorado, and Utah.

To view the ads, use the link.

Minnesota CUs' Growth Continued In 1Q

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ST. PAUL, Minn. (5/8/13)--Minnesota credit unions improved their financial strength in nearly every indicator during the  first quarter, according to the Minnesota Credit Union Network.

The state's credit unions have grown steadily since the financial crisis, with consumers and businesses choosing not-for-profit, locally owned credit unions as their primary financial institution.

"Minnesotans have always been strong advocates for the member-owned model of credit unions," Mark Cummins, MnCUN president/CEO. "Consumers trust credit unions more than other financial institutions," he said, noting they" align with their values of local and not-for-profit financial institutions."

Among the first quarter highlights:

  • Assets: Minnesota credit union assets grew 3.2% between fourth quarter 2012 and first quarter 2013. Assets grew 7.3% during first quarter from the same period a year earlier.
  • Deposits: Deposits grew 3.5% in first quarter from fourth quarter 2012, and 7.7% year over year from first quarter  2012 to first quarter 2013.
  • Loans: Year-over-year growth in loans made by Minnesota credit unions increased by 3.3% between first quarter  012 and first quarter 2013, while loans 0.5% between fourth quarter 2012 and first quarter 2013.
  • Net Income: Minnesota credit unions are rated as "well-capitalized" by the National Credit Union Administration with a net worth of 10.19%.
MnCUN based its summary and analysis on data credit unions submit quarterly to NCUA.

Tuesday's DDoS Fears Allayed, FBI Extends Alert

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MADISON, Wis. (5/8/13)--A dozen large credit unions on a hackers' hit list targeted for possible distributed denial of service (DDoS) attacks Tuesday got through most of the day without incident as of press time. An alert distributed by the Federal Bureau of Investigation Tuesday morning, however, indicated potential attacks could still exist until Thursday.

The 12 credit unions were among more than 133 financial institutions and nine government agencies, including the FBI and the White House, listed as targets on Pastebin by the hacker group OpUSA. The group had indicated that the cyber campaign would launch "on or about May 7."

Because of time zone differences between the U.S. and the countries where participating hacker groups may reside, the FBI said it expected most "significant" attack activity to occur during late afternoon or early evening EDT. However, it also warned that the groups might operate during late evening to early morning EDT, when U.S. organizations might be perceived as not have technology personnel available.

A DDoS attack involves using botnets of hijacked computers to overwhelm a website with so many requests that it can't respond to legitimate requests and stalls.

News Now checked in with credit unions on the list Tuesday and also logged into their websites and saw no evidence of a slowdown.

"So far, normal operations," said Jim Blaine, president of State Employees' CU in Raleigh, N.C., at around 3 p.m. ET. "We continue to monitor it closely," he added.

That sentiment was echoed by a number of the credit unions on the list, including BECU, Tukwila, Wash., and The Golden 1 CU, Sacramento, Calif. All are monitoring for developments.

"Everything looks good at this point,"  Patti Barrow, vice president  of marketing at Suncoast Schools FCU in Tampa,  Fla., told News Now.

Nicole Cypers, public relations and social media manager at American First CU, Riverdale, Utah, and Todd Camp, marketing communication analyst at American Airlines FCU, Fort Worth, Texas, reported no evidence of  DDoS attacks.

Others on the target list included Alliant CU, Chicago; San Diego (Calif.) County CU; Security Service FCU, San Antonio; SchoolsFirst FCU, Santa Ana, Calif.; Navy FCU, Vienna, Va.; and Pentagon FCU, Alexandria, Va. Their websites were working as usual on Tuesday afternoon.

The Credit Union National Association and several leagues alerted credit unions last week about the hacker campaign.

Even states that do not have credit unions on the public target list are warning the public of the potential attacks.  "We are taking it very serious," said Patrick Harris, director of media and public relations at the Ohio Credit Union League. The league and the Ohio Bankers League sent out their first joint widespread consumer notice warning of the coordinated online attack (Dayton Daily News May 7). Credit unions not on the list were monitoring their sites as well.

N.Y. Daily News: Fee-weary Consumers Wake Up To CUs

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NEW YORK (5/8/13)--Credit unions' growth continues as "fee-weary consumers" look for alternatives to high bank fees, said the New York Daily News, in an article Monday,

"As fee-weary consumers continue to wake up to credit unions, these alternatives to commercial banks are showing no signs of slowing down," said the Daily News.

The article notes that Brian and Carrie Packin, who own an upscale cocktail lounge midtown, pulled their money out of a savings account at a commercial bank and opened a checking account at the McGraw Hill FCU, which has a branch in their building in New York City. Now, their account earns 0.6% instead of the bank's 0.1%.  They also won't be paying ATM surcharges.

Last year was the best year to date for credit unions, which added two million members, the article pointed out.

For example, New York-based Municipal CU added 11,000 members, bringing its total membership to 350,000, and its assets grew to $1.8 billion from $135 million.  Members prefer to do business with MCU because they trust it to keep their money safe and secure and the credit union treats them like members, MCU told the newspaper.

The Credit Union National Association provided background information for the article.  The article also cited a recent Bankrate poll that compared rates between credit unions and banks on six areas. The credit unions' rates were better in five of the six.

For the full article, use the link.

Texas Bill To Expand Directors Sent To Governor

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FARMERS BRANCH, Texas (5/8/13)--A bill that contains a provision to expand the number of advisory/honorary directors on a credit union board to six from three has passed the Texas House and has been sent to Gov. Rick Perry, said the Texas Credit Union League.

"We anticipate that he will sign it in the next week or two," Jim Phelps, TCUL vice president of advocacy, said about SB 244. "It would take effect immediately and is a great bill for credit unions" (The Advocate May 6).

Making the change would allow credit unions to identify and engage new directors who wish to serve in a board governance role, and facilitate the transition of long-term directors who may no longer wish to serve as an active member of the board, but whose institutional knowledge will continue to benefit the credit unions and members, Phelps told News Now.

Also, SB 422--which makes a technical correction to the filing of process on a financial institution so that any claims must be served set on the proper party--has been signed by Perry and takes effect immediately, Phelps said.

"We had our lobby team work with the bills' sponsors to help shepherd them through the legislative process," Phelps told News Now Tuesday.

Some other Texas bills of interest to credit unions include:

  • HB 2662, which requires a class on financial literacy as part of the high school curriculum. The bill has passed the House.
  • HB 949, which adds to the statute 20 days of insurance coverage on a personal automobile when a motor vehicle is purchased based on an existing policy covering a motor vehicle. The bill passed the House and has been favorably reported from the Senate Business and Commerce Committee.
  • HB 1451, which would require the Texas Credit Union Department to establish a program to encourage credit unions to make micro-loans. The bill has been introduced but no hearings are scheduled.

Coopera: Hispanics Represent Different Market Segments

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DES MOINES, Iowa (5/8/13)--Like most cultural groups, the Hispanic market is made up of several smaller segments, many of which represent opportunities for credit unions, according to a new white paper from Coopera, a Hispanic market solutions company with a focus on credit unions nationwide.

In the paper, "The Multifaceted Hispanic Market," author Anna Pena, Coopera client account coordinator, suggests credit unions should go beyond making available a popular or emerging product to attract Hispanic consumers.

"Because there are so many facets to the Hispanic community, it's important for credit unions to understand the makeup of their local Hispanic community," Pena said. "After determining which of the Hispanic market segments exist within a credit union's field of membership, they can better define their target market and understand how service to these consumers aligns with the credit union's growth strategies."

The paper outlined three Hispanic segments in need of credit union services. They are:

  • Second generation and Generation Y. Second-generation Hispanics generally have higher incomes, more degrees and own more homes than their parents, making them attractive members
  • Small business owners. Often Hispanic business owners are on their own, without the benefit of boards of directors, shareholders or executive teams. Nearly 90% of Hispanic-owned businesses, in fact, are without paid employees. That underscores the importance of leadership support and guidance for this critical segment of the Hispanic population, the paper said.
  • Underserved. For many credit unions, the best marketing tactics for reaching the unbanked will be financial education outreach and word-of-mouth referrals, the paper said. With these methods, the credit union can begin to build awareness about the benefits of depositing and borrowing from a federally insured financial cooperative, as well as the credit union difference.
Getting Americans to choose credit unions as their best financial institution is a strategic vision for the credit union movement. One of the ways to do this--through the Unite for Good campaign--is by raising awareness of credit unions, said the Credit Union National Association. Consumers can find out more information about credit unions at aSmarterChoice.org.

CUNA Mutual: Go Paperless Effort To Raise Funds For NCUF

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MADISON, Wis. (5/8/13)--CUNA Mutual Group is encouraging its credit union members to sign up for paperless policy delivery to help the environment and raise money for the National Credit Union Foundation.

During May, CUNA Mutual will donate $5 to the NCUF for every credit union that signs up for paperless policy delivery. The insurer launched the month-long initiative with an e-mail May 1 to all credit union customers.

"As a strong 'green' advocate, CUNA Mutual launched this campaign to reduce waste, save money and take another step toward environmental sustainability," said Jennifer Norr, director, customer operations. "Plus it's a great way to support the NCUF and their programs that do so much to support credit unions."

A CUNA Mutual policy package averages 264 pages. With 6,000 credit union policies in force, the total number of printed pages can exceed 1.5 million. Reducing that provides enormous potential for savings, Norr added.

The company's goal is to inspire 2,000 credit unions to go paperless, which would raise $10,000 for NCUF. "But we won't stop there," Norr said. "If more than 2,000 of our customers go paperless within the month, we'll continue to add to the donation with the potential to give $30,000."

CUNA Mutual began making policies available online in 2012 in its Credit Union Protection and Collateral Protection business lines. Lending policies will be added later this year.

The 800 credit unions that have already gone paperless will benefit as well, with donations also being made on their behalf to NCUF.

League Surveys: Vacations Making a Comeback

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FARMERS BRANCH, Texas and COLUMBUS, Ohio (5/8/13)--Vacations are starting to make  a comeback among consumers, but travelers still are cost-conscious on vacation spending, according to separate surveys by the Texas, Ohio, and California and Nevada Credit Union Leagues.

A Texas league survey showed 64.4 % of survey respondents say they plan to take a summer vacation (LoneStar Leaguer May 2). However, the league found that even with a predicted growth in travel, some Texans are not planning to spend much more on a vacation. Nearly 45% of respondents' travel plans are identical to last year, the survey found.

Others reported these differences to their 2013 vacation plans:

  • Longer time--15.2%;
  • Shorter time--23.8%;
  • Greater distance--11.4%;
  • Shorter distance--19%;
  • Multiple vacations-- 5.7%; and
  • Different transportation--10.5%.
Credit unions can use this knowledge to help members plan their spending and save for future vacations.

For those seeking to add a vacation back into their budgets, Texas Credit Union Foundation Executive Director Courtney Moran suggested reducing leisure and entertainment expenses throughout the year to offset vacation costs.

"It's also a good idea put money away into savings from each paycheck," Moran added. "Consumers will find great savings products at their local credit union."

A survey of nearly 1,200 Ohioans by the Ohio Credit Union League shows more than 55% percent of respondents say they plan to take a summer vacation (Consider This ... May).

However, like Texans, many Ohioans are not ready to increase vacation spending. Nearly 55% of respondents' travel plans are the same as last year.

Others reported the following changes to their 2013 vacation plans:

  • Longer time--11.9%;
  • Shorter time--10.7%;
  • Greater distance--12.3% ;
  • Shorter distance--8.3%;
  • Multiple vacations--8.3%; and
  • Different transportation--5.6%.
"While we have not seen an increase in vacation loan requests yet this year, the overall feeling seems to be that members are looking for ways to add vacations back into their budgets," said Bill Burke, CEO of Day Air CU in Dayton.

Burke does see a trend toward limiting vacation spending, however. "It seems like the amounts spent on vacations remain scaled back. Instead of two or three trips, they combine them into one less costly trip or a day at local attractions,"  he added.

For those seeking to add a vacation back into their budgets, Burke suggested reducing leisure and entertainment expenses throughout the year to offset vacation costs. "We also advise people to put money away into savings from each paycheck," Burke said.

Also, 55% of Californians and 49.5% of Nevadans say they plan to take a summer vacation this year, according to a survey by the California and Nevada Credit Union Leagues.

"People take vacations to get away from everyday stresses," said Tena Lozano, leagues' consumer advocacy manager.  "However, without planning ahead or creating a budget, your vacation may generate debt that can take months or years to pay off, creating more headaches."

Ideal Mother's Gift--a Lesson In Personal Finance

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WASHINGTON (5/7/13)--A lesson in personal finance may be the ideal Mother's Day gift, given the results of a survey of consumers' opinions about their mother's personal finance skills.

More than 67% of those surveyed saw their mother as either someone who is intimidated by money (21%), views managing money as a necessary evil (26%) or has never managed money (18%), according to the survey by the National Foundation for Credit Counseling (NFCC). Only 35% said Mom is savvy managing money and enjoys it.

"What mothers may not realize is that a lack of financial skills has the potential to negatively impact not only their future, but also that of their children, as negative habits are picked up as readily as positive ones," said Gail Cunningham, NFCC spokesperson. "Mothers have an opportunity to influence multiple generations by improving their own personal financial abilities."

NFCC's 2013 Financial Literacy Survey results indicated that 33% of people surveyed learned their financial skills at home. NFCC also noted that the typical single parent is the mother who has the sole responsibility to demonstrate and teach sound financial habits, and that fewer than half of the states require taking a course in personal finance for graduation. Roughly 5% of those surveyed indicated schools were their main source of personal finance skills.

Credit unions, which have a wealth of financial education tools and programs on hand, should find it easy to tap into serving this need by considering some mothers' discomfort with finances in their educational efforts.

Perhaps that student branch can turn the tables and offer financial basics info to parents visiting the school or parent/teacher night. That reality fair for teens could include a family version. Or it may be a matter of just including personal finance information for Moms on your website or newsletter.  It's yet another opportunity to reach out to members needing solid financial information.

NEFCU Ad Seeks To Distance CU From Big Banks

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NEW YORK (5/7/13)--NEFCU, Westbury, N.Y., has launched a television commercial that highlights the differences between credit unions and big banks.

The commercial introduces NEFCU's new brand campaign: "Better banking because we're not a bank."

In the commercial, a group of banking executives gather around a boardroom table, sipping from cut-glass crystal while exchanging knowing winks and smirks, presumably making decisions to maximize profits. An Italian aria plays in the background.

"You gotta hand it to them," a narrator says. "Banks offer high-interest loans and have no shortage of takers. They get away with charging fees for most everything. When they mess up royally, they're bailed out by the government." 

The spot concludes: "Yeah, you gotta  hand it to them ... but you don't have to hand them your money."

The commercial, created by the New York advertising agency DeVito/Verdi, began airing last week throughout the New York city market. 

To view the commercial use, the link.

CU System Briefs (05/07/2013)

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  • EUGENE, Ore. (5/7/13)--Police are searching for a man who rammed his truck into a Northwest Portland, Ore., branch of Selco Community CU Sunday in an apparent attempt to steal an ATM. Selco Community has $1.03 billion assets and is based in Eugene, Ore. The crash smashed the front windows and caused significant damage to the ATM, which was just inside the credit union. The suspect got away with nothing, Portland police said. Afterwards, the man abandoned his truck a few blocks away. A nearby witness said someone tried to get into the truck but ran away when confronted, police said. They are searching for a Hispanic or white man in all-dark clothing (kgw.com and katu.com May 5)  ...
  • LAKE MARY, Fla. (5/7/13)--A woman impersonating an employee of the Lake Mary, Fla.-based CFE FCU was arrested last week on charges of grand theft, fraudulent use of personal-identification information, fraudulent use of a credit card and exploitation of the elderly. Tonya Tinch, 34, allegedly tricked an 89-year-old man into thinking she was an employee of his credit union before asking him to give her his debit card and personal information. According to the arrest report, more than $1,271 disappeared from his account, leaving the man a balance of $3.09. Tinch already was being held in the Orange County Jail with convictions of prostitution, burglary, theft and drug possession, her bail was set at $5,450 (Orlando Sentinel May 4) ...
  • SAGINAW, Mich. (5/7/13)--Catholic FCU, based in Saginaw, Mich., recently awarded more than $123,000 to 295 students through its Msgr. Forbes Scholarship Fund. "We are all very proud to support our members in need with scholarships. It is yet another perfect example of how we live our service mission to improve the financial well-being of our members," said President/CEO Alan Watson.  Scholarships are available to members that meet specific criteria such as financial need, community involvement and grade point average. Since the scholarship was founded in 1982, the committee has awarded more than $1.3 million to more than 2,800 students to begin or continue their education ...
  • TRAVERSE CITY, Mich. (5/7/13)--Members CU in Traverse City, Mich., announced that Andrew B. Kempf will be the new president/CEO of the $221 million asset credit union. A native to Michigan, Kempf has almost 20 years of experience within the credit union and finance industry. He most recently served as manager/CEO of Preferred FCU, based in Greenville, Mich., where he managed more than $50 million in assets (The Leader and the Kalkaskian May 6) ...
  • ENDICOTT, N.Y. (5/7/13)--Visions FCU in Endicott, N.Y., selected Tyrone Muse to become the new president/CEO of the $3.1 billion asset credit union. He succeeds Frank E. Berrish, who retired April 30. Most recently, Muse was the chief financial officer at Hudson Valley FCU in Poughkeepsie, N.Y. He led the $3.75 billion asset HVFCU's programs for diversity, financial performance and investment returns. Prior to that, he worked as finance manager at GE Asset Management, and as business assurance manager at PricewaterhouseCoopers LLC (Press & Sun-Bulletin, Binghamton May 5) ...

Teen's Ice Cream Co Is Northwest FCU's Youngest Biz Account

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HERNDON, Va. (5/7/13)--A 14-year-old with a neighborhood gelato and sorbet business is the youngest CEO to open a business account in the history of Northwest FCU.

Click to view larger image GG's Frozen Treats is a family business, with 14-year-old CEO Grayson Albers, his sister Gretchen and mother Mary each having a role. They are pictured with staff of the Leesburg branch of Herndon, Va.-based Northwest FCU, which provides the business account for GG's Frozen Treats. (Photo provided by Northwest FCU)

Grayson Albers, 14, started with the idea to sell lemon sorbet at his sister Gretchen's lemonade stand. A year later, GG's Frozen Treats had grown into a neighborhood hit, with a website, a menu of flavors, and shelf space at Ashburn Wine shop, Carolina Brothers BBQ and The Wine'ing Butcher.

When his company needed a financial partner, CEO Albers turned to Herndon, Va.-based Northwest FCU.

His family had been members of the $2.5 billion asset credit union for a long time, said Marty Albers, Grayson's mother. "We've had a good experience with them over the years, and knew they would be the right fit."

After studying Northwest Federal's website, Grayson arrived at the Leesburg branch with the completed paperwork and the required documents from the Internal Revenue Service and the State of Virginia. With his parents signing as joint account holders, he became the youngest business owner in Northwest Federal's history to open a business account.

With the credit union's help, Grayson set up a Basic Business Checking account, which comes with no monthly maintenance fee. Designed to help companies like GG's Frozen Treats keep more of the money they earn, it also lets businesses scan and make deposits remotely from their offices or homes--an important feature for Grayson, since he isn't old enough to drive.

While at the helm of his company, Grayson learned the value of having a good support team. In addition to local restaurants adding his product to their menus, the business receives help from a neighbor who is a lawyer, a local church that provides use of its commercial kitchen, and Northwest Federal, which offers financial services and advice.

Another key business lesson learned: You have to have a good product. "We make everything in small batches," Grayson said. "It's homemade, made fresh, with fresh ingredients."

The business is a family affair, with Mom doing the cooking, his sister serving as the taste tester, and everyone helping with kitchen cleanup. Grayson's key role is managing the business aspects. "I keep track of sales, expenses and taxes."

"It was clear that he had studied our products and services, and believed Northwest Federal would be a good financial partner for his business," said Sherry Henein, manager of its Leesburg branch, noting the credit union is excited "to help out such a young entrepreneur and to watch his business continue to succeed."

Fostering this kind of service is one of the three-pronged goals aligned with the Credit Union National Association's strategic vision for credit unions where "Americans choose credit unions as their best financial partner." For more information about the Unite for Good campaign toward this vision, use the link.

NC Legislature Passes CU Charter Bill

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RALEIGH, N.C. (5/7/13)--North Carolina's House last night passed HB 515, which would amend the state's credit union statutes, said the North Carolina Credit Union League.

"HB 515 just passed 113-0," said Lauren Whaley, North Carolina Credit Union League director of legislative and regulatory affairs, told News Now at 8:49 p.m. ET.  The league had predicted the vote would be unanimous in favor of the measure. "There are a series of three votes in each chamber--once when it is read in and then two more for passage."

FHB 515 involves modernizing changes to payable on death accounts, joint accounts and dealing with minors. It will now move to the state Senate where it will be heard in a committee before reaching the Senate floor, she added. It will be a few more weeks before it will go to the governor's desk for his signature.

The bill was introduced by John Bell (R-10), Larry Hall (D-29), Andy Wells (R-96) and Jonathan Jordan (R-93) after an overhaul of the North Carolina banking statutes by the Office of the Commissioner of Banks in 2011, the league said.

"With the input and feedback of credit unions over the last two years, the league reviewed the credit union statutes in North Carolina and listed several areas that would enhance the value of the credit union charter in North Carolina," Whaley said last month. "The league is grateful for the cooperative process that helped us identify key areas that would be of most benefit."

Andrews FCU's Gardner Tapped For Maryland Fin Ed Commission

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SUITLAND, Md. (5/7/13)--Melissa Gardner, community outreach coordinator for Suitland, Md.-based Andrews FCU, will serve as the credit union representative of the Maryland Financial Education and Capability Commission, which will conduct its first meeting Friday in Crownsville.

Gardner was appointed to the commission last October by Gov. Martin O'Malley. She fills the lone credit union seat.

"Andrews Federal has had a financial education department since 2005, and we, along with other credit unions in the state, continue to see financial education as an important part of our service to our members," said Gardner.

The commission's task is to improve financial education and capability of the state's residents by monitoring the implementation of public and private initiatives. The commission will make recommendations about the coordination of financial education and capability efforts across state agencies and by submitting reports on its findings.

State Sen. Katherine Klausmeier (Dist. 8) and Delegate Dana Stein (Dist. 11) are co-chairpersons of the commission.

NBC Among Media Reporting On CUNA's Student Loan Survey

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MADISON, Wis. (5/7/13)--NBC, along with several other media, have reported stories picking up information from the Credit Union National Association's first annual High School Student Borrowing Survey, released last month.

NBC covered the CUNA survey May 1, as did CNBC.com on Saturday, and Professional Services Close-up on April 29.

The CUNA survey also has been reported by other national media, including Bankrate.com and The Wall Street Journal (News Now April 17).

The survey found that nearly half of high school seniors don't know how much they will need for college costs, CUNA said. That lack of knowledge translates to a greater student-debt burden after college.

CUNA is lobbying the federal government to allow student loans of a longer duration than the current 15-year standard because most borrowers are taking out more loans for larger amounts.

A recap of the CUNA survey's key findings indicates:

  • 83% of students surveyed did not know the rates, and 77% didn't know the duration of their expected or existing college loans;
  • 74% of those aspiring to attend college said they will need a combination of federal and private loans, family money and jobs to support their tuition; and
  • 25% expect to take out two or more student loans; 13%, one loan; and 60% could not estimate how many they would need.

Pennsylvania Opens Its 50th Student Branch

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HARRISBURG, Pa. (5/7/13)--Tri County Area FCU, Pottstown, Pa., has opened the 50th student branch in Pennsylvania, the Pennsylvania Credit Union Association reported.

"The branch will provide a convenient opportunity for students to save and will help improve financial education in the area," said Andy Pistoria, Tri County Area FCU president/CEO.

Tri County Area FCU opened the branch in Pottstown High School (Life is a Highway April 6). It is the second in-school branch for the credit union, which opened its first branch in Pottsgrove High School four years ago.

The student branch in Pottstown High will open on Tuesdays and Thursdays during the school year from 11 a.m. to 1:30 p.m. ET.

A ribbon-cutting ceremony will be held before the 2013-14 school year.

Vancity Billboard Sports Nearly 61,000 Pennies

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VANCOUVER, B.C. (5/7/13)--The Canadian penny went out of circulation in February. VanCity, a Vancouver, B.C.-based credit union, turned the country's budget-cutting measure into an imaginative marketing opportunity, using 61,000 of the decommissioned coins to create a mosaic billboard.

Click to view larger image VanCity, a Vancouver, B.C.-based credit union, collected 61,000 of the out-of-circulation Canadian pennies to create a mosaic billboard touting its "Money Makes Good" philosophy. (Photo provided by The Financial Brand.)
In February, Vancity asked its members, "What do you plan to do with all your pennies?" on the credit union's Facebook page (The Financial Brand May 6).

The credit union offered members two ideas: Lead a penny drive to support a local cause or drop their pennies off at two of the credit union's new branches.

Vancity partnered with Vancouver-based social enterprise Starworks to use the pennies members recycled to build the "super billboard." Starworks provides employment opportunities to people with developmental disabilities.

The billboard is a demonstration of Vancity's "Make Good Money" philosophy, which seeks to create positive change within the local community, said Richard Seres, the credit union's vice president of marketing. The project put out-of-circulation pennies to use and created jobs for six people at Starworks, Seres told the The Financial Brand.

"Are you ready for change that counts?" asks the slogan on the billboard, underscoring Vancity's commitment to its community.

To watch a YouTube video about the mural, use the link.

Payment Systems' Future Is Topic Of CUNA Committee Paper

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WASHINGTON (5/7/13)--Mobile technology is here to stay and all evidence points to it having an increasing role in the payments ecosystem. Being at the center of members' payments is essential to the credit union's sustainability, relevance and competitiveness, reports a white paper commissioned by the Credit Union National Association's Community Credit Union Committee.

"The Future of Payment Systems for Credit Unions" was prepared by George A. Hofheimer, chief research and innovation officer at Filene Research Institute. (To access the full report use the link.) It outlines 12 trends in payments systems and offers tips for credit unions related to payments. They include:

  • Understand what your members need.
  • Take a holistic, collaborative approach to payments.
  • Capitalize on physical assets such as brick and mortar.
  • Leverage the power of payments data that can be gathered, mined and consolidated.
  • Continue to cooperate with payments aggregators.
  • Experiment and collaborate by taking advantage of credit unions' ability to work together.
To prepare, understand early (and sometimes weak) warning signs for disruptive innovation. Credit union strategists can:

  • Critically examine adoption of technology being implemented. "The public relations departments of new payment technology firms are very busy today," said the report. "Innovations abound, and credit unions must cast a critical eye at these new entrants to understand what is real and what is vapor."
  • Pay attention to the momentum in the payments ecosystem. Changes "will not occur overnight; therefore, keenly observe payments uptake by financial institutions, consumers, merchants, card associations, and processors. Traditional research tends to be late to the game on the topic of disruptive innovation, so rely on your payments provider who has an ear to the ground on these developments."
  • Understand the shifts in business models even if they are small. If momentum builds in the payments ecosystem but has little impact on the payment business model, pay attention. "Disruptive innovation tends to come from the lower end of the market, and entrenched players often ignore developments until it is too late."

Washington Post Features CUs' No Down Payment Loans

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WASHINGTON (5/7/13)--Two federally chartered credit unions bucking the nationwide trend of charging consumers a down payment for mortgage loans are featured in The Washington Post.

During a time of strict underwriting standards, when Fannie Mae and Freddie Mac, the Federal  Housing Administration and many others are requiring minimum down payments to qualify for mortgages, NASA FCU in Upper Marlboro, Md., is offering a zero-down payment loan option to qualified members, according to nationally syndicated real estate columnist Kenneth Harney (The Washington Post May 2). The article also was picked up by BostonHerald.com (May 5) and other media.

The $1.23 billion asset NASA FCU is offering the no-down-payment loans only to qualified members in the Washington, D.C.-area.  However, depending on local housing-market conditions, it may expand the program to other areas, it told the Post.

The maximum amount members can borrow is $650,000, and there are stringent underwriting standards. Preferred FICO scores start in the mid-700s, and seller concessions--contributions by home sellers to defray buyers' closing costs--are capped at 3%.

There have been zero delinquencies and zero foreclosures during the past year and-a-half, Bill White, NASA FCU vice president for real estate lending, told Harney.

Also, Navy FCU in Vienna, Va., with $52.4 billion in assets, offers a zero-down-payment option and no required mortgage insurance for qualified home buyers nationwide, the article said.

It allows seller concessions up to 6%, with a maximum loan amount of $1 million. The program is mostly aimed at first-time home buyers who often lack a sufficient down payment, but are otherwise creditworthy, Harney said.

To read the article, use the link.

Damm Appointed To Kansas CU Council

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WICHITA, Kan. (5/6/13)--Larry Damm, president/CEO of Cessna Employees CU, Wichita, Kan., has been appointed to the Kansas Credit Union Council by Gov. Sam Brownback.

Damm will serve a three-year term (Wichita Business Journal May 2).

The seven-member advisory council advises the Kansas Department of Credit Unions on the needs of the state-chartered credit union system.

Damm has led $233 million asset Cessna Employees CU since 1998.

Great Falls Teachers FCU Changes Name To Embark FCU

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GREAT FALLS, Mont. (5/6/13)--Great Falls (Mont.) Teachers FCU officially will change its name today to Embark FCU.

The key reason for the change is market confusion from the original name, which implied one had to be a teacher or affiliated with education to be a member,  President/CEO Deb Evans told the Great Falls Tribune (May 3).  The credit union adopted a community charter in 2001 that expanded membership to everyone living or working in five counties.

The word "embark" connotes starting a journey or investing in an enterprise, said the credit union. Many members are educators who help students embark on an educational journey every day. The credit union does the same for its members, said the credit union.

CU System Briefs (05/06/2013)

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  • VACAVILLE, Calif. (5/6/13)--Vacaville, Calif.-based Travis CU has teamed up with several schools and organizations to develop a new Work-Ready Certification Program for students. Travis will offer the Biz Kid$ financial literacy curriculum, which has been launched at all middle and high schools in Solano County. The WRC program uses entry-level job skills, identified by local business and industry, to validate that students in the area have the ability to succeed in the workplace and contribute to the community. As a stakeholder in the community, the credit union strives to empower its members and communities with information and knowledge that helps them understand their options, make smart choices, and take charge of their financial lives, Travis CU President/CEO Patsy Van Ouwerkerk told The Reporter (April 29). Partners include the Fairfield-Suisun Chamber of Commerce, Solano County Office of Education and the Fairfield-Suisun Unified School District ...
  • GREENSBORO, N.C. (5/6/13)--Tom Puckett, chairman emeritus of Charlotte, N.C.-based Postal CU, died April 25 at the age of 91, according to the North Carolina Credit Union League (The Weekly Conversation May 3). Puckett was the 79-year-old credit union's first employee. In the early years, he ran the credit union from the top drawer of his desk at the post office. "Tom loved his credit union," CPCU President/CEO Joy Watts told the league. Puckett also served as chairman of the board from 1984 to 1997, and as board treasurer. He was awarded the credit union's first chairman emeritus title in 2008. "He guided this credit union from a small credit union to over $40 million in assets" when he retired from the post office after 33 years, Watts said.  He was the Piedmont Chapter's Person of the Year. Funeral services were last week ...

Corporate America Board, Supervisory Committee Announced

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IRONDALE, Ala. (5/6/13)--Monte Hill, president/CEO of Family Savings CU, Gadsden, Ala., has been elected board chairman of Corporate America CU.

Other board officers at the Irondale, Ala.-based corporate include:

  • First Vice Chairman--Merrill Mann, president/CEO, APCO Employees CU, Birmingham, Ala.;
  • Second Vice Chairman--Brad Long, senior vice-president/chief financial officer, First Florida CU, Jacksonville, Fla.; and
  • Secretary/Treasurer--Joey Hand, president/CEO, eCO CU, Birmingham.
Other members of the Corporate America CU board are:

  • Jane Boysen, president, Alabama Rural Electric FCU, Montgomery, Ala.;
  • Kim Burkett, president, TVA Community CU, Muscle Shoals, Ala.;
  • Gary Fairley, president/CEO, Jackson Area FCU, Jackson, Miss.;
  • Joyce Harrison, president, Mobile Postal Employees CU, Mobile, Ala.;
  • Heath Harrell, president/CEO, Guardian CU, Montgomery, Ala.;
  • Steve Nix, president, First Educators CU, Hoover, Ala.;
  • Jim Phillips, director, Alabama One CU, Tuscaloosa, Ala.; and
  • Tangela Souders, president/CEO, Wiregrass FCU, Dothan, Ala.
Members of the Supervisory Committee include:

  • Chairman--Mark Johnson, president/CEO, Naheola CU, Pennington, Ala.;
  • Vice Chairman--Carrie Player, chief financial officer, Alabama Central CU, Birmingham;
  • Doug Key, president/CEO, Mutual Savings CU, Hoover, Ala.;

New Jersey League Names Michlig CEO

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HIGHTSTOWN, N.J. (5/6/13)--The New Jersey Credit Union League Friday named Greg Michlig as its new president/CEO.

Michlig, a long-time employee of the Credit Union Executives Society (CUES), will begin at the league May 20.

He succeeds Paul Gentile, who left in January to become executive vice president of strategic communications and engagement at the Credit Union National Association.

"I look forward to working with the team of the New Jersey Credit Union League to continue to build the momentum that has been so evident the past several years," Michlig said. "It has been a great pleasure working with the league board of directors throughout this process, and I am eager to begin meeting with the credit union community throughout the Garden State."

Michlig began working at CUES in 1995 in advertising sales. In 1999, he left CUES to work at PEMCO as a senior account executive. In 2008, Michlig returned to CUES, where he most recently held the position of senior director of member relations.

"Greg is widely known in the industry and has a long list of associates throughout the country, which will help him to continue to move the league forward as a respected resource," said NJCUL Chairman Lou Vetere.

"He has a proven track record of initiating and cultivating relationships that will serve him well as he meets with our credit union leadership.  His energy, drive and passion for the industry will be evident from the moment you meet him and he is focused on working with New Jersey's credit unions to help make all of them more successful," Vetere said.

Maine CU-backed Manufactured-home Bill Passes Committee

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PORTLAND, Maine (5/6/13)--The Maine legislature's Judiciary Committee gave its unanimous support to L.D. 854--a Maine Credit Union League-backed bill that clarifies when a manufactured home is considered residential real estate.

Credit union representatives testified about a week ago on behalf of the league and Maine's credit unions, supporting the legislation (Weekly Update May 3).

The league played an active role in developing the legislation's language and in seeking support from legislators. It amends the laws governing manufactured housing to say that manufactured housing--for which no certificate of title has been issued--is considered real property when it has been permanently affixed to real property owned by the owner of the manufactured housing.

The bill, sponsored by State Rep. Charles Priest (D-Brunswick), was brought forward, in part by the league, as the result of an issue raised by the Federal Home Loan Bank of Boston (FHLBB) in 2011.

"The FHLBB informed Maine lenders about a year and a half ago that they are not able to collateralize FHLBB with mortgage loans collateralized by mobile homes that were not titled and not permanently affixed to property," Ryan Poulin, president/CEO of New Dimensions FCU in Waterville, explained to the committee in his testimony.

The legislation now moves to the full legislature for consideration.

CU Icon Richard 'Doc' Heins Dies At 85

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MADISON, Wis. (5/6/13)--Richard "Doc" Heins, 85, who in 2010 was recognized with a Herb Wegner Award for  his lifetime achievements in the credit union movement, died Friday. For 27 years, Heins was with CUNA Mutual Insurance Group, starting in 1969 as a consultant and retiring in 1996 as its president and CEO.

Heins was well-known, well-respected, and well-liked throughout the credit union world, and many of the movement's top leaders who knew him best said he will not be forgotten.

"Doc was one of those rare individuals that possessed incredible creativity combined with a passion to collaborate," said Jeff Post, CUNA Mutual president/CEO. "The leadership and vision he provided--not only to the United States credit union system and its members, but other credit union systems and members around the world--is still being felt today. It was an honor to know him and learn from him."

Credit Union National Association President/CEO Bill Cheney also noted Heins' dedication to credit unions.

"Doc Heins was an icon for the credit union movement and for the CUNA/league system," Cheney noted. "In a very real way, he charted the course for the partnership between CUNA and CUNA Mutual that serves all credit unions so well to this day.  All of us will miss his visionary leadership and his consistent focus on supporting every aspect of our system."

"In his nearly four decades of association with CUNA Mutual, and more than 50 years within the cooperative movement overall, his influence was tremendous. When he was awarded the Herb Wegner Award, it was noted that throughout his career that 'he pushed us all to see beyond what is there and explore new possibilities.' No more appropriate words have ever been said for such a vital man in the credit union movement," Cheney added.

Susan Newton, executive director of the American Association of Credit Union Leagues, highlighted that Heins' dedication to credit unions was exemplified through his many achievements and innovations on behalf of credit unions, including: creating a program allowing credit unions to write loans for as little as 5% down; expanding the delivery of direct-response products including life insurance, his pioneering application of applying age and health factors to insurance risk ratings, his unwavering support of an independent federal regulator and insurer for credit unions, his backing for creation of the Filene Research Institute (and later the i3 group); and, his international work, including encouragement for rebuilding credit unions in Poland after the demise of the communist regime in that country.

"Doc was ceaseless in his devotion to credit unions and cooperatives worldwide; his legacy is stronger credit unions here in America, and a surging cooperative movement around the globe," Newton said.

The president/CEO of CO-OP Financial Services, Stan Hollen, remembered Heines as an inspiration to many over the years: "He formed his CEO Dialogue Group and Members Development Council years ago and I was fortunate to be a member.

"I still have the rocking chair he had delivered to my home that each Council Member received.  Doc was most comfortable in front of a group with an easel and marker to sketch out his ideas. His leadership in combining with Century Companies in Iowa set the stage for the future of CUNA Mutual. He will be missed but not forgotten."

Larry Blanchard, former senior vice president for special projects from CUNA Mutual Group, added that Heins was a visionary, mentor and philanthropist who embodied the philosophy of "helping people to help themselves."

"Among his great and unsung achievements was that as a young professor at University of Wisconsin in the 1960s, he conceived a novel idea to help millions of Americans become homeowners: private mortgage insurance. His interests ranged from credit unions as tools for economic and social development to urban development, manufacturing and more."

Dick Ensweiler, president of the Texas Credit Union League, said Heins was the one, along with former CUNA Mutual president Bob Curry, who recruited Ensweiler to CUNA Mutual.  He called Heins "a warm and personal gentleman who was both very bright and lots of fun" who was CUNA Mutual's "idea guy."

"Doc always had an open mind and sought input to what else the organization could be doing." Ensweiler also reminded of Heins' co-founder role for the Filene Research Institute, backing his strong belief that the credit union community needed a strong research function."

Funeral services for Heins will be held Thursday, May 9 at 11:00 a.m. (CT) at Our Redeemer Lutheran Church, 1701 McKenna Boulevard, Madison, Wis.

CUNA To League Meeting: Consumers Want Trusted Financial Partner

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DOVER, Del. (5/6/13)--Consumers are yearning for a financial partner they can trust after the banker bailout and that's why the credit union movement's Unite For Good campaign is important, Trey Hawkins of the Credit Union National Association told those attending the Delaware Credit Union League's 55th Annual Meeting and Trade Show.

More than 160 people from 20 credit unions in the state attended the April 18-20 meeting, said the league (Together April 30).

Click to view larger image Credit Union National Association Vice President of Political Affairs Trey Hawkins, in his keynote speech at the Delaware Credit Union League's 55th Annual Meeting and Trade Show, discussed protecting credit unions' tax status, CUNA's Unite for Good campaign, and regulatory burdens. (Photo provided by the Delaware Credit Union League)
Hawkins, CUNA's vice president of political affairs and keynote speaker at the event, outlined the campaign, discussed protecting credit unions' tax exempt status, and told of the "crisis of creeping complexity" in burdensome regulations faced by credit unions.

He reiterated the goals of Unite For Good--CUNA's campaign to rally credit unions toward the strategic vision in which "Americans choose credit unions as their best financial partner."  The campaign's goals are: remove barriers, create awareness and foster service excellence.

On the taxation issue, Hawkins warned that people in Washington are focused on what can be done to close the daily-increasing gap between federal spending and tax revenue. The political consensus, he said, seems to favor spending cuts or tax increases as the primary means of reducing the deficit.

Voters prefer stimulating the economy and reducing unemployment, he said, adding that credit unions contribute to the economy by providing loans that help families.

Some Americans do not know credit unions are tax exempt, Hawkins said. Now it is more important than ever to educate members about the exemption--before Congress and banks legislate it away, he added. "Members should know that 'a tax on credit unions is just another tax on people like me.'"

CUNA's Plan To Win can help credit unions both educate their members and prepare for a national call to action to protect the tax status, if needed. The plan includes four steps:

  • Educate;
  • Participate;
  • Communicate; and
  • Hold lawmakers accountable.
The Unite for Good website has action steps to help credit unions in determining how to begin or continue their advocacy. Use the link.

Regulatory burden is a major concern, Hawkins said. Credit unions were subjected to more than 120 regulatory changes from at least 15 federal agencies between 2008 and 2012--before the Consumer Financial Protection Bureau completed its first rule. CUNA recently introduced 35 regulatory relief proposals to Congress to help reduce the economic and compliance burden on credit unions.

Hawkins also discussed credit unions' electoral impact on political candidates, noting that voters were more likely to vote for someone who was a credit union champion--by 2 to 1 and discussed the role of the Credit Union Legislative Action Council in advocacy efforts.

Minnesota Man Opposes Student Branch

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COOK, Minn. (5/6/13)--An attorney working for the North Woods School in Cook, Minn., has advised the school district not to enter into an agreement with Cook (Minn.) Area CU to provide a student-run credit union branch at the school. The credit union says it is a misunderstanding.

There is no Minnesota statute that allows school districts to enter into collaborations or arrangements with private entities such as a credit union, attorney John Colosimo wrote in a letter to the school's district Superintendent Teresa Knife Chief. Colisimo said the agreement would provide opportunities for the credit union to expand its business--which would benefit the credit union and create liability issues for the school (Timberjay.com April 30).

"I think when the school superintendent contacted [Colosimo], and asked him questions about a credit union in the school, [Colosimo] assumed it was to create a regular branch, like a main branch, to sell loans and credit cards and to make money," Richard Crettol, president/CEO of Cook Area CU, told News Now.

"He thought of it as joint venture--a school going into the credit union business," Crettol added. "We look at it as an educational partnership to provide education to kids," he added.

The situation has been a misunderstanding from the beginning, Crettol said. "I told the superintendent to have a more-detailed discussion with the attorney to get him to reverse his position and send a letter to the [local] newspaper," he added.

There were more than 700 credit union branches in schools and youth clubs in 34 states last year, according the Credit Union National Association. The first school credit union branch in Minnesota opened in 2012, said Timberjay.com.

There have been no known legal problems with the three other student-run credit unions in the state, Kelli Sandhurst, communications specialist with the Minnesota Credit Union Network, told News Now.  

"We are following the situation and are going to be working with the Minnesota Department of Commerce and Department of Education to see if there is a precedent for this," she added. "We also reached out to the credit union to offer any help they want."

Delaware League Elects Board, Honors Awardees

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The 2013-2014 Delaware Credit Union League Board, includes, from left, front row: Vice Chairman Joel Romaine, Treasurer Cheryl Chilcutt, and Secretary Meredith Jeffries. Back row, from left, are: Chairman Allen Riley and Board Members Sharon Schaeffer, Jerry King, and Susan Winward.
DOVER, Del. (5/6/13)--The Delaware Credit Union League elected its board and presented awards at its 55th Annual Meeting and Trade Show in Dover April 18-20.

With "The Password Is Members" as a theme, more than 160 people from 20 credit unions statewide attended the event, with the support of 29 vendors.

The league elected three board members. Incumbent board members Cheryl Chilcutt, Louviers FCU, Newark; Allen Riley, Sussex County FCU, Seaford; and Joel Romaine, Community Powered FCU, Bear, were elected for three-year terms. At the reorganizational meeting, the following board officers were elected:

  • Chairman--Riley;
  • Vice Chairman--Romaine;
  • Secretary--Meredith Jeffries, New Castle (Del.) County Delaware Employees FCU; and
  • Treasurer--Chilcutt.
The remaining board members are Jerry King, DEXSTA FCU, Wilmington; Sharon Schaeffer, Delaware First FCU, Wilmington; and Susan Winward, Wilmington (Del.) Postal FCU.

The league recognized Pamela Fleuette, CEO of Sussex County FCU as 2012's Outstanding Credit Union Professional. She has been involved in the credit union movement as a National Credit Union Administration examiner, as a business consultant, and currently as CEO of Sussex County FCU.

The Delaware Credit Union League 2012 Outstanding Volunteer, Gerald Reynolds, (left), accepts the award from Delaware State Police FCU President/CEO Steve Cimo. (Photos provided by the Delaware Credit Union League)
Examples of the technology Fleuette has deployed to enhance existing members' services and to help attract new members:

  • SmartOffice, which combines flexible furniture and technology--the first of its kind in Delaware;
  • Interactive drive-thru teller machines;
  • Personal teller machine kiosks in each of the credit union's four branches, the first of their kind in the country; and
  • Digital advertising screens.
The league also presented the 2012 Outstanding Credit Union Volunteer award to former board chairman Gerald Reynolds of Delaware State Police FCU, Georgetown. He has been a credit union member for 50 years and a volunteer for 35 years.

Naval Base Wildfire Not Near CU Branches

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OXNARD, Calif. (5/6/12)--A credit union with six branches on or near the Naval Base Ventura County, Calif., said the branches are not located near wildfires that spread onto the naval installation's boundaries Friday.

Two wildfires had encroached the base, sending buildings and vehicles in flames as 900 firefighters fought the blaze. Its origin is being investigated. Thousands of residents along Pacific Coast Highway 101 fled the area when the fire jumped the roadway Friday morning (USAToday.com May 3). The fires had closed 10 miles of the highway as of Friday afternoon.

CBC FCU, based in Oxnard, has branches in Camarillo, Oxnard, Thousand Oaks,  and on the naval base at Port Hueneme and Point Magu.  Thousand Oaks has two branches. "None of our branches are near the fires," a spokeswoman told News Now.

The two encroachments occurred at Point Magu and near the Thousand Oaks and Camarillo Springs communities. By Friday afternoon the base announced mandatory evacuation of some residents on the base due to smoke.

CUNA Mutual Group Employees Ratify Three-year Contract

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MADISON, Wis. (5/6/13)--Office & Professional Employees International Union (OPEIU) Local 39 employees at Madison, Wis.-based CUNA Mutual Group have ratified a three-year contract.

The contract includes increases in wages and salary ranges as well as increased incentive plan payouts for leading performers; changes to pension and post-retiree benefits, including freezing the current defined benefit plan and replacing it with a cash balance defined benefit plan; and modifications to health insurance offerings and premiums.

"Union leadership and the company worked hard in the past two months to reach agreement on a contract that reflected both sides' most important issues," said David Sargent, chief human resources officer. "Our company has a goal of being an employer of choice who provides good-paying jobs, strong benefits, professional growth and development, and opportunities for employees to make a difference for the customers we serve and the communities where we live," he said.

"The bargaining committee representing OPEIU Local 39 members at CUNA Mutual Group remained focused on the issues that were important to members," said Karen Maund, chief steward.   She noted "all the innovative ideas shared at the bargaining table, at membership meetings, along with all the support and encouragement, as every member played a part in reaching an agreement that reflects good wages and benefits."

"Reaching an agreement of this sort during these economic times was difficult, but working together was key and both teams were determined to achieve results," said Debra Eveland, business representative for OPEIU Local 39. "The union looks forward to continuing a working relationship with the company."

CU Opens Fin Resource Center To Break Payday Loan Cycle

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SHREVEPORT, La. ( 5/3/13)--Pelican State CU celebrated the grand opening of its first Financial Resource Center last month in Shreveport, La. It focuses on relieving a fee burden on residents of the historic Highland Neighborhood--who do not have access to or do not qualify for low-cost financial products--through education and breaking the payday loan cycle.

Click to view larger image Pelican CU opened its first Financial Resource Center inside Volunteers of America (VOA) in Shreveport, La. The center will focus on relieving the fee burden of residents of the historic Highland Neighborhood through education and breaking the payday loan cycle. Pelican partnered with VOA and Church for the Highlands, which consider Pelican to be their "financial ministry" and refer clients to Pelican. (Photo provided by Pelican State CU).
The center was opened by the $200 million asset Baton Rouge-based credit union in partnership with Volunteers of America and the Church for the Highlands.

"Our Financial Resource Center shares a mission with the church and Volunteers of America-- to teach independence," said Jeffrey K. Conrad, Pelican CEO. "We want to convert unbanked Shreveport residents to credit union members, which will reduce the fee burden they now endure at payday lenders, check cashers and authorized utility bill payment centers."  

The center will specialize in financial education. Heike Reagan, a nationally certified credit counselor, will meet one-on-one to help members improve their credit score, budget and stretch their paycheck by avoiding fees.

The partnership was initiated by the church, which wanted to add a financial ministry to the programs already offered. Church leaders reached out to Pelican because of its long history of providing financial education and community outreach.

The center will focus on unsecured loans, credit cards, microbusiness loans, payday loan alternatives and second-chance checking for members of modest means in an effort to revitalize the community.

Although the center has the full operational capacity of a traditional branch including deposits, withdrawals and opening new accounts, it has no teller lines or conventional branch fixtures at the location.

"Pelican created an approachable, casual environment to make everyone feel welcome," Conrad said. "This, in addition to the wildly popular free coffee, has created a conversational atmosphere appreciated by our visitors."

SECU's Tax Prep Services Saves More Than $9M In Fees

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RALEIGH, N.C. (5/3/13)--State Employees' CU, based in Raleigh, N.C., helped more than 77,000 North Carolinians claim nearly $104 million in tax refunds this tax season, saving them about $9.4 million in tax-preparation fees.

A flexible "no appointment" process meant SECU assisted more members this year, the $25.5 billion asset credit union said.

It prepared and filed tax returns for 68,000 members under the Internal Revenue Service's free Volunteer Income Tax Assistance (VITA) program. That is an increase from last year's more than 57,000 filings.

SECU's low-cost tax preparation services, offered to members with income thresholds exceeding the $51,000 VITA guideline, also filed more than 9,000 tax returns, a 34% spike from last year's 7,000 returns.

Between the two programs, SECU helped members claim nearly $49 million in total tax credits, including $27.6 million in Earned Income Tax Credits, more than $18 million in Child Tax Credits and $3.1 million in Education Tax Credits.

"The success of SECU's tax preparation services is the result of the committed efforts of 1,800 SECU tax preparers who serve members' needs with diligence and patience during the busy season," said Tenesha Carter, senior vice president of SECU Tax Preparation Services.

The credit union's partnership with IRS led to an expansion of free tax preparation services in 248 SECU branches in all the state's counties and contributed to VITA's success in the state, said Debra Patterson, territory manager for IRS Stakeholder Partnerships, Education and Communication. "We value our strong relationship with SECU and support the VITA services that SECU provides to such a large contingent of eligible North Carolinians."

CU System Briefs (05/03/2013)

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  • BLACK HAWK, Colo. (5/3/13)--A former assistant manager of the Credit Union of the Rockies Black Hawk branch has been sentenced to five years in prison and ordered to pay $275,795 in restitution for a theft in 2011, according to the Jefferson County District Attorney's Office. Suspicions began after discrepancies in the ledger were found by auditors in November of 2011. Prosecutors say Autumn Rene Guillot, 31, of Central City allegedly altered the ledger to align with the small increments of cash stolen from the vault. Guillot was accused of spending the stolen funds at local casinos (Denver Post April 29) ...
  • NEW CASTLE, Pa. (5/3/13)--Victoria Rozanski, 59, of Ellwood City, Pa., has been indicted on one count of embezzling more than $100,000  from a credit union she managed in that city, the Holy Redeemer Parish FCU. The incidents allegedly occurred from January 2003 to May 2009, said the indictment. The small credit union, which operated out of a 10-foot-square room  and was open three hours a week, was absorbed a year ago by the $49.1 million asset Freedom United FCU, based in Rochester. At the time, Holy Redeemer had 234 members and nearly $630,000 in assets (New Castle News May 2) ...
  • STURGIS, S.D.(5/3/13)--The Northern Hills FCU is hosting its Second Annual Community Challenge, asking community members to save a combined total of $1 million in loan interests between now and the end of the year. When the challenge is completed, Northern Hills FCU will donate a total of $7,000 to five local charities. "We are very excited about bringing back the Community Challenge. The support we got from the community last year was overwhelming. We were even able to double our original savings goal of $500,000," said Cindy Griffin, the credit union's CEO. It offers a full line of services and products for mortgages, debt consolidation and vehicle loans to help members save ...
  • KIMBERLY, Wis. (5/3/13)--Capital CU, Kimberly, Wis., awarded $32,000 in grants to charities through its 2012 Capital CU Charitable Giving Fund. The fund, established in 2009, benefits local nonprofits and is administered by the Community Foundation of the Fox Valley Region Inc.  (Post-Crescent April 30). Receiving $5,000 each were: The Boys and Girls Club of the Fox Valley for a kids' meals program; Compassionate Home Health Care to educate residents about flu vaccinations; NAMI Fox Valley for education, support and advocacy related to mental illness; and St. Elizabeth Hospital Foundation to assist poor, homeless, under-insured or uninsured people. The St. Joseph Food Program received $4,000 for nutrition education; Housing Partnership of Fox Cities received $3,000 to support transitional housing to move families out of the shelter. Also, $2,500 each went to to Christine Ann Domestic Abuse Services and greater Fox Cities Area Habitat for Humanity ...
  • ARLINGTON, Va. (5/3/13)--National Cooperative Bank, which provides banking solutions to cooperatives nationwide, announced the appointment of Bill Stewart as vice president, credit union market leader. The bank said it plans to expand its presence in the credit union sector. Stewart has 15 years' experience, most recently developing new services and products at Southeast Corporate FCU, Lake Worth, Fla., where he was national member relationship manager. Among the services he helped create were a new institutional investment advisory service. He also served on a team that secured $70 million in member capital commitments to facilitate a major credit union merger, said NCB. NCB  has a partnership with The Members Group, a wholly owned subsidiary of the Iowa Credit Union League ...
  • SOUTH FORK, Pa. (5/3/13)--Former Board Chairman of PRR South Fork FCU George Yakicic died April 17th at Windber Hospice in South Fork, Pa. Yakicic served on the credit union board of directors for 17 years, and was chairman from 2009 to 2012,  said the Pennsylvania Credit Union Association (Life is a Highway May 2). He enjoyed hunting and fishing and was an avid Pittsburgh sports fan. He will be remembered for his produce and canned food auctions held at many different locations in the area (The Tribune Democrat April 17) ...

Wiley Named Publisher Of CUNA's CU Magazine

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MADISON, Wis. (5/3/13)--John Wiley--a veteran of the print and electronic publishing industry--is now the publisher of Credit Union Magazine, a monthly publication of the Credit Union National Association.

Wiley most recently spent 13 years as an advertising representative for the Credit Union Times.

"John is a seasoned publishing executive who also happens to have a passion and a dedication to the credit union system. That combination makes John the perfect leader to take CU Magazine to the next level," said Paul Gentile, CUNA executive vice president for strategic communications and engagement.

Gentile added that CUNA believes communication is paramount for ensuring its member credit unions are well-informed, not only on the credit union system, but the broader financial services market. For decades, he said, CU Magazine has given CUNA's membership the information necessary to best serve their credit unions. "John will help us continue that stellar record," he added.

Gentile noted that Wiley brings a broad digital media knowledge to the position that is vital for any publishing operation today. A key focus for Wiley will be to position CUNA to be interactive with readers, however they choose to engage.

"Publishing is no longer about 'one and done' deadlines. Media is constant," Gentile notes.

NH College Students Graduate With Nation's Highest Debt

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MANCHESTER, N.H.  (5/3/13)--More students pack their bags for home over financial/credit debt than academic performance, according to a release from the New Hampshire Credit Union League. Those lucky enough to graduate are confronted with student loan debt, which averages $27,000 throughout the U.S.

"What we know is that college students are 'signing on the credit card and student loan dotted line,' not realizing the full financial responsibility of these financial contracts," said Daniel F. Egan Jr., NHCUL president. "Student debt in this nation is reaching an epic level of more than $1 trillion and the financial stress is taking a toll on students via an increase in dropout rates."

New Hampshire college students owed the most, with average debt of $32,440. Adequate financial literacy education prior to graduating from high school could have alleviated many of the financial problems, the league said. NHCUL, in partnership with America's Credit Union Museum, has taken the lead in educating New Hampshire school children on basic financial literacy through the CU4 Reality Financial Education Program--in part with Financial Literacy Month events.      

Financially stressed students are six times more likely to drop out, which decreases their income earning potential, coupled with student loan obligations, which are unforgivable, NHCUL said.     

Nearly half of high school seniors in the U.S. don't know how much money they will need for college, and even more don't understand basic student loan terms, according to the Credit Union National Association's first annual High School Student Borrowing Survey released last month (News Now April 17). 

Most students (70%) are confident they will receive a high-paying job upon graduating, CUNA found. That indicates they are willing to pay the cost of college tuition even if they don't understand how the borrowing will affect their financial futures. Of the 847 17- and 18-year-olds polled nationally, 83% did not know the rates and 77% didn't know the duration of their expected or existing college loans.

In New Hampshire, "the goal of the CU4 Reality Financial Education Program is to teach students the basics of spending, budgeting, credit and savings, with the use of a classroom guide, that can be tailored to educate elementary, middle, and high school aged students," Egan said. "The goal is to establish good financial habits at a young age--habits that will last and benefit them for a life time."

The curriculum's culmination is the CU 4 Reality Financial Education Fair, a group event where students choose a fictitious "financial life"--a job and an income--and determine how they will budget. Participants must allocate funds for rent, utilities, insurance, credit card and student loans--then decide what they can afford to spend on discretionary expenses.

CO-OP White Paper Discusses How CUs Can Fight DDoS Attacks

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RANCHO CUCAMONGA, Calif. (5/3/13)--CO-OP Financial Services has released a white paper offering credit unions advice on fending off  Distributed Denial of Service (DDoS) attacks.

The white paper, "A Risk Based Approach to DDoS Protection for Credit Unions and Credit Union Service Organizations," is written by Ray Zadjmool, president and principal consultant of Tevora, a Lake Forest, Calif., information assurance consulting firm with a focus on compliance, risk management and solutions integration.

DDoS involves using an army of hijacked computers to overwhelm a site with so many requests for attention that it's unable to respond to legitimate requests and thus becomes unavailable. It has become a popular method to make a political or ideological point in which the target is some kind of symbol.

The paper makes four recommendations for combating DDoS:

  • DDoS Risk Assessments. A DDoS risk assessment should follow established methodologies for identification, impact analysis and treatment plan, the paper said. Credit unions should make a concerted effort to understand the effects of a disruption of services, the expected time to recover and the costs to remediate. Risk-reduction options also should be presented to offer a balanced approach that can be periodically evaluated for feasibility and cost effectiveness.
  • DDoS Incident Response Plan. As with any disaster recovery or incident, a plan for coordinating the credit union's response should be documented before an attack. A good DDoS Incident Response Plan must take in to account the tools and personnel at the credit union's disposal that will be needed to help in a DDoS attack.
  • Third-Party Due Diligence. Credit unions should look at this as an expansion of existing third-party and vendor management activities to include a good understanding of criticality, risk and readiness. One place to start is to classify third parties that may be susceptible to a DDoS. Consider critical infrastructure, but also Web hosting and member facing services.
  • Evaluate DDoS Mitigation Services. Currently four types of DDoS mitigation solutions exist: DDoS as a feature, dedicated DDoS protection services, Internet service provider pipe services and DDoS protection appliances.
To download the paper, use the link.

CUs Close Financial Literacy Month With More Festivities

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MADISON, Wis. (5/3/13)--As April gave way to May,

bringing a close to Financial Literacy Month, credit union activities ranged from credit card seminars, to tree distribution--all in the name of reminding members that credit unions provide a valuable partner for financial education.

Among the ways credit unions celebrated Financial Literacy Month:

  • McGraw-Hill FCU, East Windsor, N.J., presented "Credit Card Basics, Managing a Card That Matches Your Spending and Payment Habits" as part of its Financial Literacy Series April 23.
  • Security One FCU, Arlington, Texas, last month received the Texas Credit Union League's Juntos Avanzamos designation for its exceptional service to Hispanic families. Security One FCU conducted a bilingual presentation on the financial system to nearly 50 Hispanic church members; offered a presentation on the importance of saving to 20 middle and high school students; partnered with the local Head Start program to share information on basic budgeting; and offered sessions on how to build credit and secure auto financing.
  • Click to view larger image With Arbor Day and Earth Day falling during National Credit Union Youth Week, Horizon FCU, Williamsport, Pa., distributed trees to fourth graders at area school districts.  (Photo provided by Horizon FCU)
    Staff at Unitus CU, Portland, Ore., decorated branches celebrating the National Credit Union Youth Week theme "Savings Sleuth, Solve the Mystery. Week-long activities included a "Collect the Clues" scavenger hunt, a grand-prize drawing and refreshments. Young members who made a deposit or opened a uSavers account received a Moonjar Moneybox. The credit union also held an open house hosted by its uSavers Kids Club mascot, Hamilton the Pig. In addition to door prizes and food, young visitors received an "I Visited My Credit Union Today" sticker and Save, Spend and Share color book.
  • inTouch CU, Plano, Texas, raised $1,328 for the National Credit Union Foundation and the Texas Credit Union Foundation by offering employees "Jeans Days" on Fridays throughout April. Employees donated $5 each Friday in April or $18 for all four Fridays.
  • Click to view larger imageEighty-five high school seniors attended the "Bite of Reality" financial education event at San Rafael (Calif.) High School, presented by Redwood CU in partnership with the San Rafael Chamber of Commerce. Participants received a fictional occupation, salary, spouse and family, student loan debt, credit card debt, and medical insurance payments. (Photo provided by Redwood CU)
    UMassFive College FCU, Hadley, Mass., offered kids a free mustache each time they made a deposit to their Super Saver account during National Credit Union Youth Week.
  • The New Hampshire Credit Union League, in partnership with America's Credit Union Museum, helped educate New Hampshire school children on basic financial literacy through the CU 4 RealityFinancial Education Program. The goal of the program is to teach students the basics of spending, budgeting, credit and savings, with the use of a classroom guide. The program can be tailored to educate elementary, middle, and high school aged students. The curriculum's culmination is the CU 4 Reality Financial Education Fair.
  • TruMark Financial CU, Trevose, Pa., hosted Bring Your Child to Work Day April 25. Thirty-eight children ranging in age from seven to 15 shadowed their parent or guardian for part of the work day, toured the credit union's headquarters and branch offices, saw a demonstration of a cash recycler and participated in a question-and-answer session with the President/CEO Richard Stipa.
Click to view larger image Telcoe FCU, Little Rock, Ark., visited the Child Development Center to teach children about how earn money and choosing to save, donate or spend after receiving it. (Photo provided by Telcoe FCU)

CUNA created National Credit Union Youth Week, April 21-27, to help credit unions nationwide focus on the financial needs of young people and provide financial literacy education. It teaches the benefits of saving and goal setting, and invites youth to open savings accounts at their credit union--and make deposits throughout the year.

CUNA also conducts the National Youth Saving Challenge throughout April. The challenge rewards 10 savers with $100 cash prizes.

Raising awareness about credit unions is one of the steps in CUNA's, leagues' and credit unions' Unite for Good campaign to achieve the vision of Americans choosing credit unions as their best financial institution. As that awareness grows, potential members will turn to aSmarterChoice and Unite for Good websites to locate credit unions they can join and find out more.

N Dakota Governor Signs Electronic Lien Into Law

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BISMARCK, N.D.  (5/3/13)--It's now official. North Dakota Gov. Jack Dalrymple has signed into state law a measure requiring lenders, including credit unions, to file liens and security interests electronically.

He signed House Bill 1136 Tuesday, as expected, said the Credit Union Association of the Dakotas (The Memo May 1). North Dakota is the second state to mandate electronic lien filing, after Colorado.

CUAD supported the bill, which will make three changes:

  • Mandates the electronic filing of all lien documents into a Central Indexing System (CIS), which would allow for unlimited listing of collateral;
  • Reinstates SSN/FIN as a unique identifier used to search for debtor information, which were not accepted under national paper forms; and
  • Creates an upfront filing fee for the initial lien document and eliminates more than 35 fees and subscription charges, including a fee for searching and retrieving the document.
CUAD noted that the state hopes to have the CIS in operation by July 2014. Credit unions will be instrumental in developing it, said CUAD.

NerdWallet Announces GenY CU Contest

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NEW YORK (5/3/13)--Nerdwallet is holding a contest to encourage credit unions to come up with innovative far-reaching ways to reach Gen Y.

Generation Y makes up about 25% of the population, but only about 9% of credit union membership. At the same time, this tech savvy generation needs help from credit unions in the form of lower fees, higher savings rates and better financial literacy rates, Nerdwallet said.

Credit unions are eligible for the top overall prize of $2,000 and the runner-up prize of $1,000. One credit union under $500 million in assets and one credit union under $100 million in assets are each eligible for additional $1,000 prizes.

Entrants will be judged on a "commencement speech" that provides financial literacy advice to Gen Y and a proposal for using the funds awarded in the contest.

Contest participants will receive:

  • Access to the Gen Y ideas generated by other participants;
  • A listing in Nerdwallet's credit union search tool and chance to be features in the Nerdwallet blog; and
  • The potential to collaborate with Junior Achievement to receive financial literacy resource materials and training.
Bucky Sebastian, National Credit Union Foundation executive director, is among the judges for the contest.

For more information, use the link.

Bahamas CU Officials Visit Massachusetts CUs

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MARLBOROUGH, Mass. (5/3/13)--Eight credit union executives from the Bahamas traveled to Massachusetts for a four-day educational exchange, April 21-April 25, as part of an ongoing partnership between the Massachusetts Credit Union League and the Bahamas Cooperative Credit Union League.

The trip was coordinated by the World Council of Credit Unions.

Eight credit union executives from the Bahamas traveled to Massachusetts for a four-day educational exchange, April 21-April 25 as part of an ongoing partnership between the Massachusetts Credit Union League and the Bahamas Cooperative Credit Union League. The World Council of Credit Unions coordinated the trip. (Photo provided by the Massachusetts Credit Union League)
The relationship between the leagues has proven to be mutually beneficial, according to Rob Kimmett, senior vice president, marketing for the Massachusetts league (Visions & Values May).

"Over the past eight years, we have had seven different educational exchange visits in Massachusetts and in the Bahamas," Kimmet said. "Each one has produced great insight for the credit unions of each country. We are able to help our Bahamian friends with information about product development, strategic best practices and new communications techniques. They help us understand the value of our cooperative roots and provide us with a fresh way to look at the business."

During their visit, the group took advantage of two major credit union events.

One was a CU 4 Reality Fair in Leominster. The fair was presented by six credit unions and attracted more than 700 middle school students from north central Massachusetts. Its financial education curriculum impressed the visitors and they left with materials to implement a fair in their country. Later that day, they traveled to Lowell to visit Jeanne D'Arc CU and learn about the program of financial education services it provides to the community.

The other event that the group participated in was the Great New England Credit Union Show on April 24 in Boxborough. The show attracted hundreds of credit union officials and suppliers who networked and participated in numerous education sessions.

Massachusetts league President Dan Egan welcomed the group April 21 and spoke about the services that the league provides to credit unions. He then provided an overview of best practices in legislative and regulatory advocacy.

CU System Briefs (05/02/2013)

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  • ALEXANDRIA, Va. (5/2/13)--Illinois, the former home state of National Credit Union Administration board member Michael Fryzel, is the state with the largest number of federally insured, state-chartered credit unions, Fryzel told more than 120 attendees at the Illinois Credit Union System's Legislative Day held in Springfield, Ill. "NCUA enjoys a close working relationship with the Illinois Department of Financial and Professional Regulation in our efforts to protect the funds of credit union members and maintain a safe and sound credit union financial network," he told the group. Fryzel emphasized the importance of such events as the Legislative Day by saying, "Sharing concerns and ideas with elected officials is an important role in maintaining open communication about offering the best financial services to Illinois citizens. Your meetings continue to carry significant importance, and the success you achieve in them benefits the entire industry." The conference is hosted annually by the Illinois Credit Union System ...
  • MILWAUKIE, Ore. (5/2/13)--Bradley Lawrence Berg, 42, of Milwaukie, Ore., was sentenced Tuesday to four years in prison for  identity theft, stealing electronic equipment and breaking into Oregonians FCU near Milwaukie in October 2010. Berg also was ordered to pay $45,000 in restitution. He had pleaded guilty to charges of aggravated identity theft, wire fraud and burglary.  Preosecutors said Berg allegedly cut a hole in the credit union's roof, tampered with an ATM and removed the vault's keypad, His DNA was allegedly found on a used bandage found in the credit union's crawl space. He also was implicated in rooftop burglaries at office retail store in Clackamas in November and December 2010. A search of his home and storage locker uncovered identity-theft equipment, personal information of other people, PayPal checks, counterfeit Social Security cards and drivers' licenses (The Oregonian April 30)  ...

Alloya, CenCorp Complete Merger, Select Board

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WARRENVILLE, Ill. (5/2/13)--The merger between $1.4 billion Alloya Corporate FCU and $1.4 billion CenCorp was completed Tuesday at the end of the business day.

CenCorp members voted in favor of the merger on April. 4.

Under the merger agreement, the size of the board was expanded to 11 members. Board officers are:

  • Chair: Amy Sink, senior vice president and chief financial officer (CFO) Teachers CU, South Bend, Ind.;
  • Vice chair: John Fiore, president/CEO, Motorola Employees CU, Schamburg, Ill.;
  • Treasurer Leanne McGuinness, senior vice president and CFO, The Summit FCU, Rochester, N.Y.; and
  • Secretary: Curt Cecala, CEO, TCT FCU, Ballston Spa, N.Y.
Other board members include:

  • Cheryl DeBoer, president/CEO, First Community FCU, Parchment, Mich.;
  • Robin Frucci, CEO, LAFCU, Lansing, Mich.;
  • Peter Gates, CEO, Michigan Schools and Government CU, Clinton Township, Mich.;
  • Floyd Rummel, president, Dakota Territory FCU, Deadwood, S.D.;
  • Daniel Stoltz, president/CEO, SPIRE FCU, Roseville, Minn.;
  • David Suvall, president/CEO, Rhode Island CU, Providence, R.I.; and
  • Patrick White, general manager, Flint Area School Employees CU, Flint, Mich.
Supervisory Committee members are:

  • Chair: Charles Rogers, chief operating officer, Progressive CU, New York, N.Y.;
  • Michael Daugherty, president/manager, Community Plus FCU, Rantoul, Ill.; and
  • Bernard Williams, CEO, Wanigas CU, Saginaw, Mich.
Alloya serves more than 1,400 member-owner credit unions in 10 states with investment, financial, lending and correspondent services. Headquartered in Warrenville, Ill., Alloya also has offices in Southfield, Mich., and Albany, N.Y.

CU-backed ATM Fee Disclosure Bills Advance In NY Legislature

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ALBANY, N.Y. (5/2/13)--Two of the Credit Union Association of New York's highest priority bills--both governing ATM fee disclosures--have advanced to the floors of the State Senate and the State Assembly, bringing them one step closer to passage, the association said Wednesday.

A. 6234 and S. 4363 would help protect New York's credit unions from frivolous lawsuits by eliminating the requirement of physical fee disclosures on ATMs, said CUANY. The bills would bring New York law into conformity with federal statutes.

"This advancement represents a major step in the right direction in our efforts to reduce the regulatory burden for New York credit unions," said William Mellin, CUANY president/CEO.

The bills' progress was made two weeks after CUANY's annual Governmental Affairs Conference and lobby day. CUANY had made passage of the bills a priority this year.

Under current law, ATM operators are required to display notices on both the ATM screen and on the outside of the machine. However, in recent years, numerous disclosure lawsuits in several states were filed against credit unions and banks, charging violation of the Electronic Funds Transfer Act because of missing signage. In many cases, vandals had peeled off disclosure stickers from the ATMs and then sued the financial institution for noncompliance.

A similar bill passed the Nebraska State Legislature in February. Nebraska, Illinois, Nevada, New York, Vermont and Wyoming were the only states having statutes that required dual disclosures.  Nebraska was the first to amend its state law to conform with federal law (News Now Feb. 12).

On the federal level, Congress passed the ATM Bill, H.R. 4367, unanimously in December. It removes the duplicative ATM disclosure requirements, providing substantial regulatory relief for credit unions owning ATMs.

The federal law was the result of a Hike the Hill event, where a credit union CEO mentioned the issue to Credit Union National Association staff. Working together, CUNA, the leagues and credit unions drafted the federal legislation and advocated for  its passage (News Now Dec. 12).

Emmy Winner Mark DeCarlo To Emcee ACUC

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MADISON, Wis. (5/2/13)--The Credit Union National Association announced that Emmy Award-winning comedian and food/travel expert Mark DeCarlo is slated as the Master of Ceremonies for the 2013 America's Credit Union Conference, June 30 through July 3 at the Hilton New York in New York City.

"Mark DeCarlo will make an engaging emcee for this year's conference," said Todd Spiczenski, vice president of CUNA Center for Professional Development. "His witty nature and great cultural insights will be a great fit with the ACUC audience."

DeCarlo has contributed his charismatic expertise in broadcast for more than 10 years. He currently hosts and produces comedic segments on Chicago's No. 1 daytime show, "ABC's Windy City Live," in which he celebrates the people, places and off-kilter characters that define Chicago. His work on the show won him back-to-back Midwest Emmys in 2011 and 2012.

Prior to his work in Chicago, DeCarlo traveled across 400 cities for four seasons of Travel Channel's "Taste of America with Mark DeCarlo." He compiled the experience in his bestselling book, A Fork on the Road: 400 Cities, 1 Stomach. In 2013, DeCarlo will chronicle his book/performance tour nationwide in a HuffingtonPost.com Travel Blog and broadcast his new podcast/radio series, "A Fork on the Road Show."

ACUC features business innovators to deliver ideas for growth and inspiration to drive positive change for the credit union movement, CUNA said.

For more information, use the link.

Excellence Award Winners Honored By HR/TD Council

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MADISON, Wis. (5/2/13)--The CUNA HR/TD Council announced its Excellence Award winners during the council's 19th annual conference, April 21-24 in Anaheim, Calif.

The awards recognize and honor credit unions that exemplify excellence in the human resources and training disciplines and serve to promote credit union philosophies through people leadership.

This year's winners (by category) are:

  • Employee Engagement (assets less than $499 million): Town & Country FCU, South Portland, Maine, for its "Employee Experience Team" Program. The team, which guided the credit union in choosing initiatives, was led by human resources and employees who volunteered to help execute employee-centered activities and events reflecting the needs and desires of the staff.
  • Employee Engagement(assets $500 l to $1 billion): Member One FCU, Roanoke, Va., for its "Using the Humanities to Give Business Training a Soul" Program, which is a diverse offering of courses related to sales, soft skills, economics and leadership that are business related and humanities based. Each program involves music, poetry, literature, the fine arts, history or dance.
  • Employee Engagement (assets more than $1 billion): Mountain America CU, West Jordan, Utah, for its "How-to Training Videos," created in-house for use in the classroom to demonstrate a real life environment using a medium that is attractive and engaging to its audience.
  • HR/TD Management Practices (assets less than $499 million): Maps CU in Salem, Ore., for its "To the Olympics and Beyond  Health and Wellness" program, a multi-year implementation of a more defined wellness initiative concluding with a company-wide "Walk to the London Olympics" program.
  • HR/TD Management Practices (Assets $500 million to $1 billion): Red Canoe CU, Longview, Wash., for its "Commit to be Fit" program, a multi-year wellness program focusing on whole body wellness with a yearlong commitment to personal happiness.
  • HR/TD Management Practices (Assets more than $1billion): Mountain America CU, West Jordan, Utah, for its "IRA eLearning Suite," which successfully converted an entire operational training class to eLearning. The set of courses are 24/7 accessible, provide a consistent message and can be revised.
  • HR/TD Strategic Leadership(assets less than $499 million): Town & Country FCU for its "Online Banking Conversion." Using an all-in approach with employee focus groups, volunteer subject matter experts, and theme days, Town & Country FCU completed the fastest, most efficient conversion the vendor had ever seen.
  • HR/TD Strategic Leadership (assets more than $1 billion): University of Wisconsin CU, Madison, Wis., for its "Emerging Leader" program. Recognizing that internal candidates promoted to leadership roles were more likely to be successful leaders, the credit union created a 12-month program focusing on introducing candidates to leadership success criteria, corporate strategy, core functions and specific training on learning imperatives to equip emerging leaders for success.
For more information, use the link.

When Rivermark Members Speak, Lawmakers Listen

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BEAVERTON, Ore. (5/2/13)--Grassroots advocacy must be Rivermark Community CU's middle name. The Beaverton, Ore.-based credit union succeeded in getting more than 7,000 consumers to sign an online petition to "Say No to Big Banks"--within three days.

When the $547.3 million asset credit union sent an e-mail on Wednesday, April 24, asking members to sign the Northwest Credit Union Association's petition on saynotobigbanks.com, more than 2,000 signed the petition by that evening. By Friday, more than 7,000 consumers had signed it, said NWCUA (The Anthem April 30).

That's in addition to the 4,000 signatures already on the site.

"This is such a great demonstration of how powerful grassroots advocacy can be," said Jennifer Wagner, NWCUA vice president of legislative advocacy, in the article. "This is Main Street talking, and legislators listen to that.

"When you see thousands of credit union members step up so quickly, it makes it very clear that they want to protect the not-for-profit, cooperative structure of their credit unions, so that they can continue to see the real, tangible benefits of their membership," Wagner said. "If every credit union is able to engage their members at some level, the value of the credit union model will become loud and clear."

The petition stemmed from a Leadership Symposium during which attendees were "fired up discussing the bank lobby's attack on credit unions," said NWCUA, which co-sponsored the event.  Although state legislation attempting to impose additional regulatory burden is already dead in the Oregon legislature, the banks' push to eliminate credit unions' tax exemption, is active in 20 states and on the federal level, said NWCUA.

"We believe this is only the beginning of a protracted attack by the banking lobby," wrote Scott Burgess, Rivermark president/CEO, in his e-mail to about 30,000 members. "Your continued support will undoubtedly be important, both to Rivermark and to credit unions across the state."

It isn't the first time that Rivermark's members, staff and directors heeded the call to advocacy this year. More than 1,400 members wrote and e-mailed their legislators earlier in the state legislative session.

Protecting and defining the credit union tax exempt status is the top legislative priority for the Credit Union National Association, which has called on credit unions to Unite for Good to support its strategic vision in which "Americans choose credit unions as their best financial institution."

By working to remove barriers like regulatory burden and attempts to whittle away at credit unions' not-for-profit structure and tax exemption, by raising awareness of the value of credit union membership, and by continuing to foster service excellence that engages members, credit unions can expect such responses from their members.

For more information on that effort, use the link.

CUs In Three States Report Compromised Cards

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MADISON, Wis. (5/2/13)--Credit unions in three states are reporting fraudulent activity related to compromised cards from breaches and skimming devices. The incidents are in Illinois, California, and Alabama.

The University of Illinois Employees CU, Champaign, Ill., last week replaced about 3,400 debit cards and 1,400 credit cards that had been compromised by a data breach at Schnuck's supermarkets after a "tsunami" of fraud reports that may cost "tens of thousands" of  dollars, the credit union told the News-Gazette  (May 1).  

Schnuck's is a privately held chain of more than 90 supermarkets in the Midwest.  The breach was announced last month (News Now April 2).

The credit union accommodated debit card owners by waiving fees on Visa travel cards and offering shared-branching services so members could get cash. About one in four of the credit union's cardholders had used their cards at Schnucks during December to March, when the information was compromised.

In Capitola, Calif., Bay FCU members reported fraudulent transactions to the $678.5 million asset credit union.  Police are investigating more than 50 credit card reports related to information that may have been skimmed on devices planted at a local gas and automotive store.  The gas station was unaware of the devices and is cooperating with police, said the San Jose Mercury News (April 30).

Fort McClellan CU,  an $184 million asset credit union  in Anniston, Ala., sent a letter to members indicating that during March,  debit card accounts issued by banks and credit unions in Calhoun County, Ala., and nearby communities, were compromised and unauthorized transactions made on "many" accounts  (Examiner.com April 30).

Authorities have not determined how the account numbers were obtained, but they said credit union members and bank customers affected had used the cards in a common environment or merchant location. The account information was distributed to criminals who made unauthorized transactions "on a widespread basis."

The credit union is contacting members whose cards were compromised and is arranging to reissue new cards.

PCUA, PCUF, Cable Network Team Up On Financial Town Meetings

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HARRISBURG, Pa. (5/2/13)--The Pennsylvania Cable Network (PCN) is partnering with the Pennsylvania Credit Union Association and the Pennsylvania Credit Union Foundation to conduct a series of quarterly town meetings concerning financial literacy.

The second in the series, "Financial Do's and Don'ts," will take place on Friday, May 10. PCN will tape the educational session and air it statewide later that day.

The town meeting, which is free and open to the public, will start at 10 a.m. ET at the Mohler Center in Hershey.

Attendees will learn the financial "do's and "don'ts" when dealing with investments, reverse mortgages, estate and retirement planning, as well as how to avoid scams.

The panel leading the discussion includes:

  • Joseph Wambach, executive director, PCUF;
  • Diana Roberts, CEO, Hershey FCU, Hummelstown;
  • David Shallcross, senior community liaison, Pennsylvania Office of Attorney General;
  • Aimee Toth, deputy secretary for securities, Pennsylvania Department of Banking and Securities; and
  • Mary Bach, consumer advocate.

Top 10 News Now Stories For April

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MADISON, Wis. (5/2/13)--An article about the Credit Union National Association alerting credit unions to "chatter" detected about a potential widespread Distributed Denial of Service attack that could be planned for May 7 was the most read News Now article in April.

The Top 10 articles for the month:

10. TCUF Assessing Situation After Explosion In Central Texas

FARMERS BRANCH, Texas (4/18/13)--The Texas Credit Union Foundation says it is poised to help those credit unions and their employees impacted by the explosion at a fertilizer plant in the town of West.

9. Survey: 88% of ATM Owners Not Ready For Global Standards

SIOUX FALLS, S.D. (4/30/13)--Survey results confirm that ATM owners' concerns about the ATM liability shift that went into effect a week ago are justified, the ATM Industry Association announced Monday.

8. Cost Of Reg Burden Gets Human Face From CUNA Witness

WASHINGTON (4/10/13)--The overwhelming regulatory burden, and the difficulty of raising capital, have made it more difficult for her credit union to reach out effectively to the Hispanic community in her area, the Credit Union National Association's witness told a hearing today on providing credit unions with regulatory relief.

7. NCUA Sets Ethics Standard For Its Employees

ALEXANDRIA, Va. (4/18/13)--The National Credit Union Administration has enhanced its employee ethics standards, adding new rules that would prevent its workers, including examiners, from taking on additional credit union employment to avoid potential conflicts of interest.

6. Super Glue Latest ATM Skimmers' Weapon

SPOKANE VALLEY, Wash. (4/30/13)--Super glue is the latest weapon of choice among ATM skimmers--thieves who put devices on ATMs to skim personal identification numbers from cards used at ATMs, according to Numerica CU.

5. CU Participants At Boston Marathon Are Safe

BOSTON (4/16/13)--While credit unions maintained a presence at yesterday's Boston Marathon, no credit union representatives were reported injured as a result of the explosions that tore through the finish line of the race on Monday, killing at least two people and injuring dozens more.

4. Bank of America Settles With NCUA, Bringing Total Securities Suit Gains To $335M

ALEXANDRIA, Va. (UPDATED: 4/3/13, 10:20 a.m. ET)--Bank of America has agreed to pay $165 million to the National Credit Union Administration to settle an outstanding NCUA securities lawsuit. This settlement will bring the total amount of funds recovered from agency securities lawsuits to more than $335 million, according to the NCUA.

3. TDR Guidance Released For NCUA Examiners

ALEXANDRIA, Va. (4/3/13)--The National Credit Union Administration has shared with credit unions guidance it provided to agency examiners on how to review loan workouts, nonaccrual policies, and regulatory reporting of troubled debt restructurings.

2. Surcharge Bans Continue To Gain Momentum

MADISON, Wis. (4/2/13)--The number of states considering bans on imposing a surcharge on credit/debit cards is gaining momentum. At least 18 states are considering such proposals, with one measure reaching a governor's desk. That's in addition to 10 states with laws already on their books.

1. CUNA Warns Of Potential Denial Of Service Attack

MADISON, Wis. (4/26/13)--With the increasing prevalence of Distributed Denial of Service (DDoS) cyberattacks, the Credit Union National Association is alerting credit unions to "chatter" that has been detected about a potential widespread attack that could be planned for May 7.

Montana Network Honors Mayer, Rummel

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HELENA, Mont. (5/2/13)--The Montana Credit Union Network recently honored its Volunteer and Professional of the Year during the organization's annual meeting in Great Falls, Mont.

Click to view larger image Kevin Mayer, center, manager of Richland FCU, Sidney, Mont., was named the Montana Credit Union Network Professional of the Year. Mayer is pictured with supporters from Richland FCU.
Kevin Mayer, manager of Richland FCU, Sidney, Mont., was named the MCUN Professional of the Year. "He does so much to represent Montana's credit unions," said Tracie Kenyon, MCUN president/CEO.  "It's nice that he's getting some recognition in return."

Mayer has worked Richland FCU for nearly 30 years. He served on the MCUN Government Relations Committee and as a board member of the former Treasure State Corporate CU.

A strong proponent of financial education, Mayer serves on the business advisory council at Sidney High School and provides a strong financial education program for every eighth-grader and high school senior in the community.

Click to view larger image Carl Rummel of Missoula (Mont.) FCU was named the Montana Credit Union Network (MCUN) Mitch Reed Volunteer of the Year. From left, Tracie Kenyon, MCUN president/CEO; Rummel; and Gary Clark, president CEO of Missoula FCU. (Photos provided by Montana Credit Union Network)
"Our youth are not exposed to any financial education," Mayer said. "There is no curriculum in the schools, and I just think it's important for our youth to be exposed to financial education at a younger age."

Carl Rummel of Missoula (Mont.) FCU was named the Mitch Reed Volunteer of the Year. "Carl is a phenomenal credit union volunteer," said Kenyon. "He's educated on our issues, engaged, and really fun. He is truly deserving of this wonderful honor."

Rummel has volunteered for the past decade at Missoula FCU and been an active member of the credit union for 33 years. He has served on the supervisory committee and the board of directors. As a board member, he has served as treasurer, vice chair and chair. He is the first person in Montana to earn Credit Union National Association's Certified Credit Union Volunteer designation.

"He is an integral part of the board, but beyond that he is a true motivator and leader who brings staff and management together to work as a team," said Gary Clark, Missoula FCU president/CEO.

CUNA's Gentile Explains CU Difference On Dakotas Radio

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BISMARCK, N.D. (5/2/13)--Credit unions' value as not-for-profit cooperatives in today's economy was the subject of Credit Union National Association Executive Vice President of Strategic Communications and Engagement Paul Gentile's recent appearance on the Legislature Today Radio Hour, sponsored by the Credit Union Association of the Dakotas.

"We serve Middle America, given that we have 40% of the population as members, but just 6% of the marketplace," Gentile told CUAD. "Credit unions have no outside shareholders to please with high profits." 

Credit unions can play an important role in the economic recovery through small-business lending, he said, noting that credit union small-business loans average $217,000. "We do the true mom and pop loans that are so important to local communities, but banks don't want to touch," Gentile added.

The broadcast also featured Rep. Mark Owens (R-Grand Forks), a board member of First Liberty FCU, Great Falls, who noted the credit union's member business lending (MBL) for landscape trucks.

CUNA and credit unions are urging Congress to raise credit unions' MBL cap to 27.5% of assets, from the current 12.25% level. Doing so would generate $14.5 billion available for MBLs--and increase jobs by 158,000 in the first year without costing the taxpayer, according to CUNA statistics.

Gentile also spoke about aSmarterChoice as an outlet for consumers to find a credit union they can join. "Consumers can't join all credit unions, but there's certainly a credit union for everyone," he said.

Raising awareness about the value of credit unions is a key component of credit unions' Unite for Good campaign to achieve the strategic vision: "Americans choose credit unions as their best financial partner," CUNA says. For more information, use the link.

To listen to the CUAD Legislature Today Radio Hour, use the link.

NEW: Fed Policymakers Hold The Line

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WASHINGTON (FILED at  2:40 p.m.  ET 5/1/13)--As expected, the Federal Reserve's monetary policymakers, the Federal Open Market Committee (FOMC), held the line on the Fed's bond-buying and interest rates another month. However, it formally announced, for the first time, that it would increase or decrease the bond buying policy "as the outlook for the labor market or inflation changes."

Noting that "economic activity has been expanding at a moderate pace," the committee, in its statement  today after a two-day meeting, said it will continue buying back $40 billion a month in Treasuries and $45 billion a month in mortgage-backed securities (MBS) as part of its continued quantitative easing policy.

The targeted federal funds rate for short-term loans remains at 0% to 0.25%. The Fed has said in the past it would keep the rates at near-zero levels until unemployment fell to 6.5% or lower--if inflation forecasts were no more than 2.5%.  Currently the unemployment rate is at 7.6%, and the inflation gauge is below the 2% target.

The FOMC noted that labor market conditions have shown some improvement in recent months but the unemployment rate remains elevated. "Household spending and business fixed investment advanced, and the housing sector has strengthened further, but fiscal policy is restraining economic growth. Inflation has been running somewhat below the committee's longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices. Longer-term inflation expectations have remained stable," said its statement.

The committee said that "with appropriate policy accommodation, economic growth will proceed at a moderate pace and the unemployment rate will gradually decline toward levels the committee judges consistent with its dual mandate" of price stability and fostering maximum employment.

FOMC "continues to see downside risks to the economic outlook" and "anticipates that inflation over the medium term likely will run at or below its 2% objective."

In deciding to continue to purchase more agency MBS and longer-term Treasury securities, known as quantitative easing, FOMC said it "is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. Taken together, these actions should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative."

The committee "will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability," the statement said. It added the FOMC "is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes. In determining the size, pace, and composition of its asset purchases, the committee will continue to take appropriate account of the likely efficacy and costs of such purchases as well as the extent of progress toward its economic objectives."

In deciding to keep the target range for federal funds at 0% to 0.25%,  FOMC said it "expects that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens." It anticipates "that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6.5%, inflation between one and two years ahead is projected to be no more than a half percentage point above the committee's 2% longer-run goal, and longer-term inflation expectations continue to be well anchored.

In determining how long to maintain a highly accommodative stance of monetary policy, the committee will also consider other information, including additional measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. "When the committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2%."

Voting for the policy action were Fed Chairman Ben S. Bernanke; Vice Chairman William C. Dudley; James Bullard; Elizabeth A. Duke; Charles L. Evans; Jerome H. Powell; Sarah Bloom Raskin; Eric S. Rosengren; Jeremy C. Stein; Daniel K. Tarullo; and Janet L. Yellen.

Esther L. George, who voted against the action, said she was concerned that the continued high level of monetary accommodation increased the risks of future economic and financial imbalances and, over time, could cause an increase in long-term inflation expectations.

For the full statement, use the link.

Bethex's Cousminer Inducted Into Co-op Hall of Fame

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WASHINGTON (5/1/13)--Credit union activist Joy Cousminer, who has devoted 58 years to breaking economic and educational barriers and improving the lives of people in New York's economically distressed South Bronx area, will be one of four cooperative innovators honored May 8 at the Cooperative Development Foundation's (CDF) 2013 Cooperative Hall of Fame Induction Ceremony.

Gasper Kovach Jr., board chair of the CDF, says on the foundation's website that induction to the Cooperative Hall of Fame is reserved for those who have made "genuinely heroic contributions to the cooperative community."

Cousminer, founder and now president/CEO of Bethex FCU, is being recognized for bringing financial services into an area that had no banking facilities and no access to credit.

"The many innovative programs and partnerships offered by Bethex reflect (Cousminer's) recognition of the financial, educational, and business needs of the people of the South Bronx and her efforts to meet them. Her work embodies the ideals of community spirit, determination, vision, and cooperation. She is a leader with a quintessentially cooperative spirit," the CDF website says of Cousminer's nomination.

She will be honored at a dinner and recognition ceremony held at the National Press Building here next Wednesday. The other inductees on the program are:

  • Steven Dawson, founding president of the Paraprofessional Healthcare Institute;
  • Rebecca Dunn, executive director of the Cooperative Fund of New England; and
  • Leland Ruth, co-founder and board secretary, California Center for Cooperative Development.

Other credit union movement representatives who were inducted to the CDF Hall of Fame in recent years include David Chatfield, retired president/CEO of the California and Nevada Credit Union Leagues; former Credit Union National Association President/CEO Dan Mica; and Larry Blanchard, former senior vice president for special projects from CUNA Mutual Group.

Illinois League Legislative Day Kicks Off Today

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SPRINGFIELD, Ill. (5/1/13)--More than 110 credit union activists are expected to attend the Illinois Credit Union League's annual legislative day and reception today in Springfield.

The event continues a new format started last year with an earlier start time to provide attendees with opportunity to visit their local lawmakers earlier in the day.

Other events include:

  • Regulatory Update. Officials including National Credit Union Administration Board member Michael Fryzel and Illinois Department of Financial and Professional Regulation acting secretary Manny Flores will discuss key regulatory developments impacting the credit union movement.
  • "Debunking the Taxation Argument." Mike Schenk, Credit Union National Association economist, will refute banker taxation arguments.
  • Sponsor Award Presentation--SB16 (Foreclosure Fast Track and Funding Bill). ICUL Legislative consultant Joe Lyons, will present sponsor awards to state Sens. Jacqueline Collins (D-Chicago) and John Mulroe (D-Chicago), and Cook County Recorder Karen Yarbrough, in appreciation for their roles in passing critical mortgage foreclosure legislation in 2012.
  • Credit Union Legislative Issues Briefing. Steve Olson, ICUL executive vice president, general counsel, will brief participants on key credit union and league legislation to prepare for visits with legislators.
  • State Capitol visits. Participants will be shuttled to the Capitol so they can personally call on lawmakers and view the legislative process firsthand. The Illinois House already has passed its third reading deadline April 19, and the Senate reached its third reading of substantive bills April 25.
  • Open House of New Legislative Offices. A showcase of the league's new Springfield office space, including a ribbon cutting, is scheduled between Capitol visits and the Legislative Day Reception.
  • Legislative Reception. All 177 lawmakers from both sides of the aisle, plus constitutional officers, and other dignitaries, have been invited to a reception for further credit union networking.
Last week, the league hosted a new telesession to further brief registrants on the top credit union legislative issues.

Falkland Islands Seek Advice On Forming CU Framework

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STANLEY, Falkland Islands (5/1/13)--Dwayne Naylor, chief operating officer of Local Government CU in Raleigh, N.C., last month volunteered on behalf of the World Council of Credit Unions to help establish a sustainable credit union framework in the Falkland Islands.

Click to view larger image Michael Betts, left, Falkland Islands Development Corp. acting infrastructure development manager, explored credit union development for the islands with Dwayne Naylor, right, chief operating officer of Local Government CU, Raleigh, N.C., during Naylor's visit there in April. Naylor was on assignment for the World Council of Credit Unions. (Photo provided by the World Council of Credit Unions)
One bank branch operates on the Falkland Islands, located off southeastern coast of South America. Residents find it difficult to access credit. The government established the Falkland Islands Development Corp. to provide financing to island businesses that have been refused bank financing.

Islanders also want to share ownership of a financial institution with shareholders holding equal voting rights, said WOCCU. Residents had heard positive things about North American credit unions and requested WOCCU assistance to introduce credit unions in the Falkland Islands.

Naylor reviewed the necessary legislative framework and explained the credit union model to interested citizens and local authorities. He assessed local infrastructure, information systems and professional staff capacity and requirements to provide savings, consumer lending, transaction services, remittances, international transfer services and business lending.

Despite keen local interest, the Falkland Islands' small population makes credit union sustainability a challenge, said WOCCU. With 2,300 working-age islanders, Naylor and Development Corp. staff considered whether a credit union could be sustainable without achieving scale.

"The Falklands' economy is changing rapidly," Naylor said. "Increased access to a credit union will be in the community's interest to grow."

The team continues to review alternative information communication technology strategies for cloud-based, back-office processing and mobile services on the island.

"We knew this would be a challenge from the start when the Development Corp. approached us, but we remain optimistic that in today's world, credit unions can provide an empowering solution for this community as well," said Brian Branch, WOCCU president/CEO.

Court Stays Eight NCUA Suits Pending Appeal Resolution

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KANSAS CITY, Kan. (5/1/13)--Eight lawsuits by the National Credit Union Administration against big banks that sold residential mortgage-backed securities (RMBS) to corporate credit unions before the financial crisis hit are on hold, pending a decision by the Tenth Circuit Court of Appeals on two consolidated cases.

U.S. District Court Judge John W. Lungstrum in Kansas City, Kan., Monday ordered the stay in the cases, pending the appeals' court resolution of an interlocutory appeal. The lawsuits are against RBS Securities Inc., Wachovia Capital Markets LLC, J.P. Morgan Securities LLC, UBS Securities LLC, Barclays Capital Inc., and Credit Suisse Securities (USA) LLC, and others.

Lungstrum's decision was made after a status conference Monday. In the order, he wrote that a stay is "appropriate in each of these cases" because "the appeal may materially advance the ultimate termination of expensive and complex litigation.

"Indeed, the Tenth Circuit's opinion (applied to each of these cases) could result in the dismissal of all claims with respect to a number of certificates, including the dismissal of all claims against certain defendants," Lungstrum wrote.

"Interests of judicial economy and the time and expense that could be spared the parties depending on the outcome of the appeal, which are served by a stay, significantly outweigh the detrimental effect of a delay in starting the discovery process," said the order.

The stay halts all proceedings except the completed briefing and resolution of any pending motion to dismiss, and any submission by NCUA--if it chooses--of a motion related to statistical sampling it described in the status conference.

RBS Securities appealed a July 25, 2012, ruling by U.S. District Judge Richard D. Rogers in Topeka, Kan., in the two consolidated cases.  At issue is whether NCUA brought its claims within the three-year statute of repose period required to file a civil lawsuit. NCUA argued that an Extender Statute allows more time to file its lawsuits. Rogers had agreed that the extender statute applies, and RBS Securities appealed to the Tenth Circuit Court in Denver.

The appeals court will decide whether the Extender Statute applies to the state of repose as outlined in the Securities Act, and whether it applies to federal and state statutory claims (News Now Nov. 20).

Earlier last month, Lungstrum dismissed NCUA's claims on 12 of 20 certificates sold to U.S. Central FCU, Western Corporate FCU, and Southwest Corporate FCU by Credit Suisse, saying NCUA did not file its lawsuits in time (News Now April 11).

In each suit, NCUA claims the RMBS sellers misled the corporates as to the stability of the investments.

Members Borrow More In Q1, Save Less Than Year Ago

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MADISON, Wis. (5/1/13)--First-quarter credit union financial results indicate members were more willing to borrow and less willing to save than a year earlier, according to a Credit Union National Association economist's analysis of March's monthly sample of credit unions.

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"Loan balances rose 0.4% in the first three months of 2013, compared with a slight decline in the first quarter of 2012," Steve Rick, CUNA senior economist, told News Now. "Members are in the auto-buying mood with new- and used-auto loan balances rising 2.5% and 2.3%, respectively, in the first quarter, compared with 0% and 1.2% last year.

CUNA economists are forecasting overall credit union loan balances to rise 5.5% this year, "the fastest pace since 2008," he added. "The increase in loan balances, combined with the simultaneous drop in the dollar amount of delinquent loans, brought down the loan delinquency rate--delinquent loans to total loans--from 1.15% at the end of 2012 to 1.03% at the end of March 2013. We expect the delinquency rate to fall another 10 basis points to end the year around 0.93%."

CUNA released its Monthly Credit Union Estimates Tuesday. Credit union loans totaled $617.3 billion, compared with $586.9 billion in March 2012. Credit union loans outstanding rose 0.3% during March, compared with a 0.1% increase for the same month last year. Fixed-rate first mortgages led loan growth, increasing 1.6%. Used-auto loans rose 1.2%, home-equity increased 1%, and new-auto loans went up 0.9%. Adjustable-rate mortgages declined 1.6%, other loans outstanding dropped 1.4%, and unsecured personal loans decreased 0.5%.  

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Credit union savings totaled $931.1 billion in March--or $46.5 billion more than $884.6 billion in March 2012. Credit union savings balances rose 1.8% in March, compared with a 2.7% increase in March 2012. Share drafts led savings growth with an increase of 3.9%, followed by regular shares (2.8%), individual retirement accounts (1.6%), and money market accounts (0.9%). One-year certificates fell 0.2% during March.  

"First-quarter savings balance growth (3.8%) came in below last year's pace (4.6%) due to the expiration of the payroll tax cut, higher gas prices and an increased willingness by members to spend," Rick explained. "For the year, we expect savings balance growth to come in at 5%, slightly below last year's pace of 6%."

The movement's overall capital-to-asset ratio remained at 10%. The total dollar amount of capital is $111 billion.

"Credit unions reported first-quarter earnings of 0.75%--as a percentage of average assets--similar to the pace set last year," Rick said. "This earnings rate should be sufficient to boost capital-to-asset ratios from 10.2% today to 10.7% by year end."

Total credit union membership grew 0.3% during March 2013. As of February, credit union membership totaled 96.7 million.

With savings outpacing loans, credit union's average loan-to-savings ratio decreased one percentage point, to 66.3% in March from 67.3% in February. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--is 21%.

Credit unions' 60-plus-day delinquency rate declined to 1% during March from 1.1% in February.

CU Link Cooperative Ad Campaign Launched

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LANSING, Mich. (5/1/13)--Michigan's CU Link cooperative advertising campaign has launched on TV, radio, outdoor and online, said the Michigan Credit Union League.

The campaign has $2.4 million worth of advertising, plus an additional $500,000 provided to credit unions to spread the campaign at the grassroots level. It is backed by a record total of more than $1 million in contributions from credit unions (Michigan Monitor April 29).

This year's campaign emphasizes that consumers can do all their "banking" at a credit union, and highlights the value of membership that credit unions bring to the marketplace. The ads highlight the lower loan and credit card rates credit unions have compared to banks, and focus on how much members can save every year, the league said.

All of the media elements direct potential new members to www.culinkMichigan.com. The information that appears in all credit union finders online are pulled from one credit union finder, "A Smarter Choice."

Credit unions can update their own information. All participating credit unions also were sent a CU Link marketing kit with instructions that tell them how to create and maintain their profile page.

Raising awareness about the value of credit unions is a key component of credit unions' Unite for Good campaign to achieve the strategic vision: "Americans choose credit unions as their best financial partner," according to the Credit Union National Association. For more information, use the link.

Regulator: Wash CUs Can Offer Key-Person Insurance

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OLYMPIA, Wash. (5/1/13)--The Washington State Department of Financial Institutions (DFI) Division of Credit Unions, in an interpretive statement, outlined the permissibility and standards for state-chartered credit unions' purchase of "key-person" life insurance products.

The April 24 statement by Division of Credit Unions Director Linda Jekel addressed two types of insurance:  key-person insurance, known as bank-owned life insurance (BOLI) , which benefits the credit union, and employee benefit plans that include life insurance products that benefit the employee.

BOLI key-person insurance is commonly used by financial institutions to protect against the loss of a key person whose services are essential to the institution's continuing success and whose untimely death would be disruptive.

Federal credit unions also have the ability to make otherwise impermissible investments to fund employee benefit obligations, said the statement.

Jekel said the DFI has said that purchasing and holding of the two types of life insurance is permissible and facilitates the delivery of financial services to the credit union's members. 

They may purchase and hold life insurance products so long as the credit union follows the standards set forth in  the interpretative statement, including provisions from the National Credit Union Administration regarding the Employee Benefits Rule and an Interagency Statement of the Purchase and Risk Management of Life Insurance from four federal agencies--the Office of the Comptroller of the Currency, the Federal Reserve Board of Governors, the Federal Deposit Insurance Corp. and the former Office of Thrift Supervision.

The Northwest Credit Union Association also alerted its member credit unions to the interpretive statement in its Anthem newsletter Tuesday.

Kansas CUs End 2012 With Growth

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WICHITA, Kan. (5/1/13)--Kansas credit unions reported strong performances in several key areas for 2012, led by gains in assets and loans, the Kansas Credit Union Association said.

"Kansas credit unions are deepening relationships with members, exploring new delivery channels and finding ways to reach borrowers in the communities they serve," said Tammy Wendland, consultant for KCUA. "Despite increasing regulatory burdens, our credit unions continue to elevate the financial health of 626,000 Kansas member-owners."

Total assets at Kansas credit unions increased 7.84% from December 2011, exceeding the national average of 6.23%. Loans rose 6.15% in Kansas compared with the national average of 4.54%.

Kansas credit unions reported a 7.79% gain in shares. This exceeds the 6.09% growth rate in shares nationally. The growth was led by an 18.73% jump in money market shares.

Kansas credit unions reported an average capital ratio of 11%, compared with the national average of 10.4%. Revenues for 2012 grew 3% in 2011 and are beginning to return to 2009 levels, said KCUA.

Sales of mortgage loans on the secondary market have assisted in creating a 22.8% increase in non-interest income over 2011, KCUA said. The sales have helped hold up credit union bottom lines as loan yields continue to fall in the current low interest-rate environment.

Delinquency rates remained fairly constant among Kansas credit unions, compared with 2011, standing at 0.94% at the end of 2012 and beating the national average by 22 basis points. Net charge-offs at Kansas credit unions for 2012 was 0.58%, decreasing 71 basis points from the end of 2011 and beating the national average of 0.74%, KCUA said.