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CU System briefs (05/30/2014)

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    WASHINGTON (5/30/14)--In a May 29 entry about Congressional gridlock on The Washington Post's "The Fix" blog, author Aaron Blake cited an article by Ryan Donovan, senior vice president of legislative affairs at Credit Union National Association. The percentage of salient issues in gridlock has doubled since 1950, Blake noted, and a full 75% of today's issues are in gridlock. However, Blake called out a Credit Union Magazine graphic that shows the percentage of legislation enacted as a percentage of legislation introduced. "Here's a great visualization of that 'gross' approach," he wrote, using the magazine's chart and linking to Donovan's article ...
  • BATON ROUGE, La., and KNOXVILLE, Tenn. (5/30/14)--Sometimes it's a surprise and sometimes it's announced, but almost always the acts of kindness by credit unions are appreciated. Through its #PelicanPays campaign, Baton Rouge, La.-based Pelican State CU bought free snow cones for all the customers at the Alexandria Sno-Shack May 20 (eNews May 28). The $219 million-asset credit union bought more than 530 icy treats during the two-hour "takeover." On Thursday night, ORNL FCU held a cash mob at Diamond Car Wash and Deli in Knoxville, Tenn., where the first 30 customers received a $20 gift card. The $1.4 billion-asset credit union has held nearly 20 cash mobs as part of its Small Business Counts program that supports local businesses by attracting consumers with social media and other promotions ...
  • LINDEN, N.J. (5/30/14)--Joanette Hall Keyes, CEO of Heard AME FCU, Roselle, N.J., died May 23. She was 76 (Daily Exchange May 28). A lifelong member of the Heard African Methodist Episcopal Church, Keyes was the founding member and CEO of the $256,400-asset credit union, which is open every Sunday morning. She worked for New Jersey Bell Telephone Co. for 30 years and managed Pinewood Hall, Roselle, for 12 years ...

Familiar names could woo young consumers from FIs

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WASHINGTON (5/30/14)--Google, T-Mobile, Wal-Mart. These are not names normally associated with the financial industry.

But a survey by Accenture of 4,000 Americans has found, especially in young consumers, that if these tech giants and others offered services similar to credit unions and other financial institutions, many would flock to their doors.

Digitally, of course.

The 2014 North America Consumer Digital Banking Survey found that 72% of people age 18 to 34 would manage finances with tech and retail companies such as Wal-Mart, Google or T-Mobile if they offered banking services.

The survey also found that nearly 40% of Canadian and U.S. adults under 35 would switch to an online-only, or branchless bank, compared with 29% of consumers age 35 to 55 and 16% of consumers over 55.

"The game is changing for banking in Canada and the U.S., and tomorrow's consumer is coming of age with a very different perception of what a bank could be," said Jodie Wallis, managing director of Accenture's Canadian banking practice (The Wall Street Journal May 27). "These new customer expectations will prove disruptive to banks, if non-bank entrants gain momentum and if banks do not adapt quickly."

While these retail giants have yet to evolve into fully functional financial institutions--which would require obtaining a bank charter, as Wal-Mart tried and failed to accomplish several years ago due in large part to opposition from the banking industry--several still have started offering certain financial products.

Some offer prepaid debit cards, allow consumers to make purchases and deposit checks with smartphone cameras, provide check-cashing services, and even offer cash loans to businesses, such as Square's recently unveiled cash advance program (See News Now May 29).

If credit unions and other financial institutions want to keep up with these tech giants, some say, they have to step it up.

"Digital technologies are dissolving the boundaries between industry sectors," Juan Pedro Moreno, Accenture global banking practice senior managing director, told The Wall Street Journal. "For banks, simply being 'more digital' versions of what they are today will not be enough to assure success in the future."

Other key findings of the survey:  
  • More than 1 of 4 customers would likely consider a branchless digital bank if they chose to leave their current financial institutions;
     
  • Nearly 75% of U.S. consumers consider the relationships they have with their financial institutions as merely transactional, rather than based on one where they can receive financial advice or have a broader relationship;
     
  • More than half of consumers want their financial institutions to proactively suggest products and services that would help them meet their financial needs; and
     
  • Nearly half of all consumers are interested in spending analysis that is forward-looking and available in real time.

Applications open for cooperative finance fellowships

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NEW YORK (5/30/14)--The National Federation of Community Development Credit Unions is accepting applications for the second year of its Cooperative Finance Leaders for America (CFLA) program.
 
The program recruits, trains and supports 15 new and emerging credit union leaders who provide credit and safe banking services to low- and moderate-income communities.
 
During the six-month paid fellowship, the CFLA participants will go through an intensive training program that includes a weeklong summer institute in New York City in August.
 
The federation encourages credit unions to recruit candidates. Both the credit union and the candidate must submit completed applications by July 2. 
 
Fellowships are expected to begin in September and continue through February.

Consumers tuck savings into checking accounts: America Saves

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WASHINGTON (5/30/14)--Traditional savings accounts hold a strong advantage for savers, but according to a survey released Thursday by America Saves, transaction-based checking accounts are a common place for consumers to stash their cash.
 
Ruling out retirement accounts, checking accounts were cited by one-third of respondents as a place to put money aside for savings. When selecting more than one option for saving, another 13% said they kept their savings in a "safe place at home."
 
Two-thirds selected credit union or bank accounts as their primary savings vehicle followed by brokerage accounts (11%) and money market accounts (10%).  
 
Although 3% said a "safe place at home" was their primary place to house their savings, nearly 10% of those who make less than $25,000 reported using home as a literal piggy bank.
 
The survey of 1,220 America Saves participants also found that automated savings--either through direct payroll deposit or automatic electronic funds transfer--was the most popular method of saving at 70%.
 
"For years America Saves has promoted automatic savings as the key to successful saving. We also consistently receive tips from savers which say setting up automatic savings methods is one of the best ways to save because they can set it and forget it," said Director Nancy Register.
 
In-person contact increased with age and was higher among those with less than $25,000 in income.
 
Of the 15% who said they had only one goal, 34% focused on saving for retirement.  Nearly a third of the savers had three goals in their minds to achieve.
 
The America Saves campaign is managed by the Consumer Federation of America.

CU helps students attend re-opened college

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YELLOW SPRINGS, Ohio (5/30/14)--YS FCU has stepped in to provide loans to students of recently re-opened Antioch College, allowing young adults to study at their school of choice.
 
Because it was closed from 2008 to 2011, Antioch College won't be accredited until 2015, which means students can't use federal student loans for tuition until then. As of May, the $16 million-asset Yellow Springs, Ohio-based credit unions has saved nine students from dropping out due to lack of finances, according to President/CEO Sandy Hollenberg

YS FCU has experienced no losses and there is "greater than 80% share-security pledged from unencumbered endowments to ensure low risk to the credit union," Hollenberg said (eLumination May 28).
 
Because the Yellow Springs economy is largely dependent on the college, helping Antioch College succeed is critical to the community, Hollenberg said.
 
Credit union staff also provide loan recipients with financial education, creating a budget and payment plans.
 
Several students at Antioch College have agreed to form a student advisory committee, which will share the credit union philosophy and market YS FCU to other students. Hollenberg also plans to invite students from other area colleges and high schools to join the advisory committee.
 
Also, the credit union has hired three students as part-time interns, participates in the school's student body meetings and offers educational sessions to the student body.

Ala. CU gets final OK for Flint River Bank buy

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DOTHAN, Calif. (5/30/14)--In what an industry lawyer says is becoming a trend, the National Credit Union Administration Wednesday approved $260 million-asset Five Star CU acquisition of Flint River National Bank in Camilla, Ga.
 
The deal is expected to close in June, Michael Bell, attorney Howard & Howard, Royal Oak, Mich., who is representing Dothan, Ala.-based Five Star CU, told News Now.
 
"This is a great deal for everyone involved," Bell said. "The credit union acquires assets at a reasonable price and gains new customer/members. It's also a great deal for the community, which gains exposure to credit union's services.
 
Robert Steensma, president/CEO of Five Star CU, said the deal was "right in our wheel house." Five Star already has a presence in Georgia, and the acquisition of Flint River National Bank will allow the credit union to expand its agricultural lending portfolio.
 
"We will also offer the only free checking account in the area," Steensma told News Now. "There are four or five other banks in the area, but none of them offer free checking."
 
Since 2011, four other credit unions have acquired or are in the process of acquiring bank operations. Municipal Employees CU of Baltimore, with $1.2 billion in assets, took over operations of Advance Bank in December (News Now Dec. 4). GFA FCU, Gardner, Mass., with $409 million in assets, acquired Monadnock Community Bank in December 2012. United FCU, based in St. Joseph, Mich., with $1.6 billion in assets, purchased Griffith (Ind.) Savings Bank in December 2011.
 
In March, $2.3 billion Landmark CU, New Berlin, Wis., announced the completion of its planned acquisition of Hartford, Wis.-based Hartford Savings Bank.
 
Bell, who has served as attorney on four of what he calls cross-industry transactions, told News Now that more are in the works and other credit union acquisitions could involve other types of financial service providers such as loan companies and payday lenders.
 
"These deals are instantly profitable for credit unions," Bell told News Now. "Not only are they a source of growth, they bring credit union services to a new segment of the population to new communities that didn't previously have them. It's a very exciting development."

New CUNA E-Scan sets course for strategic planning

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MADISON, Wis. (5/30/14)--Once an annual fall event, strategic planning sessions now occur throughout the year as credit unions re-evaluate and address challenges as they crop up.  The Credit Union National Association just released its annual research and analysis publication--2014-2015 CUNA Environmental Scan--that provides information and insights to help credit unions in these endeavors.
 
"The nature of strategic planning is to make the tough decisions to drive positive business outcomes," said Doug Benzine, CUNA vice president of publishing and strategic resources. "We prepare the E-Scan report each year in user-friendly formats to make sure credit unions have the reliable data and valuable insights they need to make those tough decisions and plan with confidence."
 
E-Scan's introduction notes that growth is the No. 1 priority for 72% of credit unions, but it will be more difficult due to competition and an ever-changing environment.
 
Chapters cover marketing and business development; human resources; economics, finance and lending; compliance and legislation; political advocacy; and technology and payments (See News Now May 23: Real-time transactions disrupt payments systems: E-Scan).
 
Additionally, the report identified trends for credit unions to be aware of mobile payments and banking, Europay-MasterCard-Visa card migration, lending, operating ratios, lower fee and non-interest income, and interest-rate risk.
 
The E-Scan app will be included with purchases of the E-Scan report, which is available in print, eBook and PDF formats.

NFCC survey: Worth it to have diploma in one hand, debt in the other

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WASHINGTON (5/30/14)--Is financing a college education a good investment? There's no simple answer, according to a National Foundation for Credit Counseling (NFCC) Financial Literacy Survey. U.S. adults have a varied range of opinions and experiences when it comes to how they view student loan debt--and many adults say they would have benefited from the type of financial advice that credit unions can provide.
 
By a 2-1 margin, borrowers were more likely to say that their student loan was a good investment than a bad investment.  At the same time, however, more U.S. adults would not recommend student loans as a way to finance a college education compared with those who would recommend doing so.  Some felt that if they had realized the amount of student loan debt that they would accumulate, they never would have taken out loans. 
 
Many adults say that they would have benefited from financial counseling on both ends of the loan--before taking out their loan, as well as after--for many admitted that it is difficult to find the right student loan repayment program for their situation.
 
Others in the survey expressed interest in obtaining a graduate degree, but felt they could not afford it.  Some predicted that they would probably still be paying off their own student loans when their children begin college.
 
Even if a person secures a good-paying job, an average student loan debt of close to $30,000 can start graduates off in a financial hole, especially as interest accumulates, said Gail Cunningham, NFCC spokeperson. A number of income-based repayment plans are offered by the government, but sorting through them to find the right plan can be challenging. Financial counseling can help graduates identify optimal repayment plans that can minimize the amount of interest paid over the life of the loan, while maintaining an affordable monthly payment.

N.Y. prize-linked savings bill headed to Gov. Cuomo

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ALBANY, N.Y. (5/30/14)--A revised version of a bill that would allow credit unions and other financial institutions to offer prize-linked savings accounts has again passed the New York Legislature, and for the second time awaits the signature of Gov. Andrew Cuomo.

The Senate recently voted to approve the bill, and an identical companion bill has already been passed by the Assembly (The Point May 29).

The bill should be familiar to Cuomo, who vetoed an earlier iteration last year over concerns he had about certain language violating the state's constitution.

In response, the Credit Union Association of New York, which strongly advocated for the bill, worked closely with the governor's office, the Department of Financial Services and the state Gaming Commission to put together the updated piece of legislation, a concept for which Cuomo has shown public support.  

"The governor's office wants to see it happen," Michael Lanotte, CUANY senior vice president/general counsel, told News Now earlier this year (March 26).

Prize-linked savings accounts are products that can be offered by credit unions and other financial institutions that incentivize and reward members and consumers for healthy savings behavior.

Nearly half of U.S. adults are victims of compromised personal data

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NEW YORK (5/29/14)--The personal information of 110 million U.S. citizens, or almost half of the nation's adult population, has been exposed by hackers sometime in the last 12 months, researchers have found (CNNMoney.com May 28).

Perhaps even more eye-opening, Ponemon Institute, the organization that compiled the data for CNNMoney, discovered that 432 million individual accounts have been compromised during that time.

"It's becoming more acute," Larry Ponemon, head of the Ponemon Institute, told CNNMoney.com. "If you're not a data breach victim, you're not paying attention."

Each compromised record often includes personal information such as names, debit or credit card numbers, emails, birthdays and passwords.

Breaches have become so common that researchers say consumers are beginning to experience "data-breach fatigue."

To illustrate that point, CNNMoney compiled a list of the most notable breaches in recent months: 
  • 70 million Target customers had personal information stolen, including information from 40 million credit and debit cards;
     
  • 33 million Adobe user credentials were compromised, including 3.2 million stolen credit and debit cards;
     
  • 4.6 million Snapchat users' account data were accessed;
     
  • 3 million payment cards at Michaels were exposed;
     
  • 1.1 million cards from Neiman Marcus were exposed;
     
  • A "significant number" of AOL's 120 million account holders' information was compromised; and
     
  • Possibly all of eBay's 148 million customers' credentials were exposed.  
While exposures at these retailers have grabbed headlines, what might be even more alarming is that healthcare and pharmaceutical companies rate even worse than retailers in terms of security performance, according to recent analysis performed by BitSight Technologies (Businessweek.com May 28).

"To see (healthcare companies score) below retail--having seen what we've witnessed in retail over the last six to nine months--we thought it was pretty sobering," Stephen Boyer, BitSight chief technology officer, told Businessweek. "They're failing to do even some of the basic level protections."

CUs need tech to be top of millennials' minds

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WATERLOO, Canada (5/29/14)--When it comes to serving millennials, think pragmatism, not philosophy, and it wouldn't hurt to reinforce the difference between credit unions and other financial institutions.
 
Debunking the idea that millennials base their purchasing practices on values, the May 28 Digital Fieldwork report contends that credit unions aren't high on the list because of a lack of awareness and a perception that they are behind the times technologically.
 
"Millennials are very pragmatic and have high expectations around technology," said Laurie Paleczny, co-founder of Digital Fieldwork. "If convenience and functionality aren't there, they'll do business with banks, even if they do not always respect their values."
 
"Strangers in the Night: Credit Unions, Millennials and Digital Behavior" examined thousands of online data points for 18- to 34-year-olds from January to April.
 
Although millennials may have positive attitudes toward credit unions and negative ones toward banks, they still are confused about the differences. The question of "What is a credit union?" is asked on Google and user forums such as Reddit--most frequently by those considering switching from a bank.
 
Digital Fieldwork noted that millennials crowd source their financial advice on blogs and forums--areas that provide anonymity--not on Facebook, which is better for social engagement.
 
With more industry stakeholders than consumers as followers, Twitter is in effect an echo chamber for credit unions--40% of a credit union's followers follow at least one other credit union--the report noted.

Ala. CUs credit co-op structure, community for success

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BIRMINGHAM, Ala. (5/29/14)--A May 28 Business Alabama article discussed the recent growth of state credit unions--as evidenced by their record total of 1.9 million members after the addition of 40,000 newcomers in 2013.
 
Alabama credit unions have added 150,000 members and grown assets to $18.3 from $13 billion, according to the League of Southeastern Credit Unions (LSCU).
 
With assets that are roughly 10% of those of the state's two largest banks, credit unions have grown through focused grassroots marketing efforts and creating income through innovation and increased technology, said Steve Swofford, president/CEO of $620 million-asset Alabama CU, Tuscaloosa, and LSCU board chair-elect.
 
Technology has leveled the playing field, according to Merrill Mann, president/CEO of $2.4 billion-asset APCO Employees CU, Birmingham. For example, the credit union introduced online mortgage lending within the past five years, he said. Members can complete and application within 20 minutes from the comfort of their homes. That convenience has helped the credit union increase its lending portfolio considerably.
 
America's First FCU in Birmingham added mobile banking and mobile check deposit within the past few years, and both offerings have been popular with members, according to Bill Connor, president/CEO of the $1.2 billion-asset credit union.
 
Swofford said the structure of member-owned credit unions and their focus on members rather than profits are crucial to success. "Our customers are owners of the credit union, and that's a big, big deal," he told Business Alabama. "And at most credit unions, I think great customer service is still a huge deal. I think personal service is a differentiating factor between us and banks."
 
Credit unions have also lent money to small businesses at a time when many banks wouldn't extend credit, according to Patrick La Pine, LSCU president/CEO.
 
"Credit unions are doing more commercial lending because there is a niche there to be filled," La Pine told Business Alabama. "Our loans are truly for small businesses, under $250,000 and often under $50,000. There's really a niche in there for us, because the banks don't want to make a loan under $1 million. There's a lot of room for us to help those small business owners."
 
The Credit Union National Association and credit unions are urging Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. CUNA and credit unions say that increasing the cap would open up more opportunity to offer MBLs, inject $13 billion in business loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers.

Entrepreneur cites CUNA in its CU business lending article

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WASHINGTON (5/29/14)--The Credit Union National Association was featured front-and-center recently in an Entrepreneur Magazine article describing how credit unions are "the perfect partners for entrepreneurs and small businesses."

Member business lending, up 9.2% in the first three quarters of 2013, is the fastest-growing segment of the credit union industry, Patrick Keefe, CUNA senior vice president/chief communications officer, told Entrepreneur.

The May 27 article "Credit Unions Are Increasingly Business Friendly" goes on to describe a constellation of ways in which credit unions have immersed themselves in the member business lending industry. 

Entrepreneur first notes the example set by Bethpage (N.Y.) FCU, with $5.4 billion in assets, which has opened up a new division that works with local businesses, and now boasts more than 5,000 accounts and $230 million in deposits in its business lending portfolio.

The piece also reports how credit unions in Wisconsin have ramped up business lending by 73% since the Great Recession, while business lending at banks has only edged up 1.5%, according to numbers from the Wisconsin Credit Union League.

Keefe further illustrates in the article how credit unions support entrepreneurs with the example of a freelance photographer from New York who, in need of an infusion of cash to upgrade his equipment, chose a credit union over a bank to lock down a loan.

The member-owned institution helped the business owner secure a $25,000 loan to modernize and expand his online video services.

"While banks may seem like an obvious choice, credit unions are an increasingly important funding source for small businesses," wrote Daniel Carlsson, the article's author.

Cash mobs also have become popular with credit unions, Carlsson noted, especially in Ohio and in Michigan, where more than 50 credit unions have employed the practice to support small businesses.

Cash mobs are coordinated shopping sprees where a large group of community members assemble and buy products from local businesses en masse.  

Credit unions also support local businesses, the article said, through initiatives such as "Shop Main Street," a rewards program that incentivizes consumers to shop locally.

"The Shop Main Street rewards program is a winner in every respect," said Stan Hollen, president/CEO of the credit union service organization CO-OP Financial Services. "It all adds up to creating a sense of community, with a program that keeps local dollars in the local economy."

NWCUA elects new members to board, 2 retain seats

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PORTLAND, Ore. (5/29/14)--Jim Lumpkin, president/CEO of $72 million-asset USAgencies CU, Portland, Ore., and John Zmolek, president/CEO of $422 million-asset Verity CU, Seattle, have been named to the Northwest Credit Union Association's board of directors after their nominations for open seats were not contested.
 
Veteran directors Jack Fallis, president/CEO of $370 million-asset Global CU, Spokane, Wash.; and Bob Newcomb, president/CEO of $1.1 billion SELCO Community CU, Eugene, Ore., will retain their seats on the board. Their nominations also were not contested (Anthem May 28). Newcomb will continue to represent District 1, while Fallis remains the District 2 representative.
 
All four will begin their three-year terms immediately following the NWCUA's annual business meeting, which will be held Oct. 7 during the 2014 Amplify Convention in Spokane, Wash.

Lumpkin will represent medium asset-size credit unions. He replaces Shirley Cate, president/CEO of $122 million-asset Providence FCU, Milwaukie, Ore., who served on the Oregon Credit Union League board and the NWCUA board for many years.
 
Zmolek will take the place of Terry Belcoe, president/ CEO of $174 million-asset North Coast CU, Bellingham, Wash., who opted not to seek re-election to his District 8 seat after serving on the Washington Credit Union League board and the NWCUA board for seven years.

Public funds depository legislation voted out of Ohio House committee

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COLUMBUS, Ohio (5/29/14)--The Community Access and Local Government Choice Act, House Bill 221, which would permit credit unions to accept public deposits up to $250,000, was voted out of the Ohio House of Representatives State and Local Government Committee Tuesday by an 11-6 vote.
 
"This is the first time we've got this bill out of committee after working more than a decade on this legislation," Patrick Harris, the Ohio Credit Union League's director of legislative affairs, told News Now Tuesday. "But we aren't celebrating by any means. It's just one of several hurdles we have yet to clear."

The bill now moves to consideration before the full House, which goes into recess June 4. "We're going to push to have it heard before then," Harris said. "It will be a tough challenge with such a short time frame. If that doesn't work, we will look toward a lame duck session in November to try to get it out of the House and into the Senate."

The bill faced strong opposition from banks in the House committee process--and that opposition will continue before the full House and Senate, Harris noted.

On Monday, banks introduced an amendment to the bill that would subject state-chartered credit unions to a financial institutions tax. The amendment was defeated by an 11-6 vote after Harris provided testimony in which he defended the intent of the legislation and asked legislators to consider the difference between the structure of credit unions and banks.

"If the playing field is to truly be level, then those same institutions should operate as cooperatives, and return their corporation's profits to their members, rather than a select number of stockholders," Harris testified.



 

N.Y. CUs collect Desjardins, Maxwell awards

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ALBANY, N.Y. (5/29/14)--The New York Credit Union Foundation recently recognized credit unions' financial education efforts for youth and adult audiences as well as their social responsibility programs.
 
The first-place award for the Alphonse Desjardins Adult Financial Education Award went to Hudson River Community CU, Corinth, with $179 million in assets.
 
Winners of the Alphonse Desjardins Youth Financial Education Awards are:
  • Less than $50 million: Clarence Community and Schools FCU, Clarence;
  • $50 million to $150 million: CORE FCU, Syracuse; and
  • More than $500 million: Corning FCU.
The Dora Maxwell Social Responsibility Community Service award winners by asset size include:
  • $5 million to $20 million: Clarence Community and Schools FCU;
  • $20 million to $50 million: Western New York FCU, West Seneca;
  • $50 million to $100 million: CORE FCU;
  • $100 million to $200 million: Hudson River Community CU, Corinth;
  • $200 million to $500 million: Sidney FCU; and
  • More than $500 million: AmeriCU CU, Rome.
The Utica-Rome Chapter received first place in the association/league category.

Bank branch purchase in Floridacentral's future

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TAMPA, Fla. (5/29/14)--Looking to provide more access for its members in the Sarasota area, Floridacentral CU has initiated the purchase of a First Federal Bank branch.
 
"We don't have a touch point there, and we've wanted to be in that area for some time," Vice President/Chief Marketing Officer Brian Robinson told News Now Wednesday.

Bradenton and Port Charlotte are the two branches furthest south for the $386 million-asset credit union, which is based in Tampa. Adding the Sarasota branch would fill a gap in the region and make the credit union more convenient for its members who live in the area.
 
President/CEO Laida Garcia told the Tampa Bay Business Journal that Floridacentral is "healthy and strong" and has been waiting for the right opportunity to expand (May 28).
 
Pending approval from state and federal regulators, the purchase is expected to be completed by July.

CU System briefs (05/29/2014)

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  • LAS VEGAS (5/29/14)--
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    Nevada credit union leaders recently met with Gov. Brian Sandoval in Las Vegas. Among the discussion topics were improvements to the state's economy and how credit unions are working in their respective communities to assist members. From left, Andy Hunter, president/CEO, $637 million-asset Silver State Schools CU, Las Vegas; Rick Schmidt, president/CEO, $131 million-asset WestStar CU, Las Vegas; Eric Estes, president/CEO, $489 million-asset Boulder Dam CU, Boulder City; Sue Longson, retired vice president of business development and community relations for $595 million-asset SCE FCU, Irwindale, Calif., and president/CEO of SONEPCO FCU, Las Vegas; Gov. Sandoval; Wayne Tew, president/CEO, $504 million-asset Clark County CU, Las Vegas, and chairman of the Nevada Credit Union League; Wally Murray, president/CEO of $454 million-asset Greater Nevada CU, Carson City; and Melissa Ameluxen, vice president of state government affairs for the California and Nevada Credit Union Leagues (Photo provided by the California and Nevada Credit Union Leagues) ...
  • OKLAHOMA CITY (5/29/14)--The Focus FCU, Oklahoma City, recently increased ATM fees to non-members by 25 cents, donating the extra money received to the Children's Miracle Network, the Cornerstone Credit Union League reported. The change was implemented on April 1. The first month, the $96 million-asset credit union increased donations by $594 and is on track to contribute more than $7,000 to CMN in 2014 (Leaguer May 28). "Credit unions have a national partnership with the Children's Miracle Network Hospitals," said Kyle Roush, The Focus FCU president/CEO. The Focus FCU sponsors a number of programs and events throughout the year supporting Children's Miracle Network and the Children's Hospital Foundation as part of the national Credit Unions for Kids initiative. Last year, Oklahoma credit unions donated $198,000 to the Children's Miracle Network ...
  • KANSAS CITY, Kan. (5/29/14)--Midwest Regional CU, Kansas City, Kan., named Thad Jones its new president/CEO, effective July 1. Jones succeeds Lloyd Nugent, who will be retiring from day-to-day operations of the $58 million-asset credit union after 22 years as president/CEO (Vision May 27). Jones has been with the credit union since 1992 as controller and vice president of accounting and technology ...
  • JACKSON, Miss. (5/29/14)--Mississippi Credit Union Hall of Fame inductee James L. "Jimmy" Dewey of Gulfport, Miss., died May 23, noted the Mississippi Credit Union Association's CU Connection (May 28). He was 67. After serving in the U.S. Army Reserves and the U.S. Marine Corps, Dewey worked as a member of the security team at the Veteran's Administration hospitals in Gulfport and Biloxi, Miss., for more than 30. Over the course of 40 years, he volunteered for a number of Gulf Coast credit unions, including a stint as treasurer of $80 million-asset Gulf Coast FCU, Gulfport. Dewey was inducted into the Mississippi Credit Union Hall of Fame this year ...

CU System brief (05/28/2014)

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  • COLCHESTER, Vt. (5/28/14)--The Vermont Legislature honored Ron Hance, president/CEO of Heritage Family FCU, Rutland, with $347 million in assets, for his nearly 40 years of service to the credit union movement (NewsLines Express May 23). House Concurrent Resolution 342, offered by both state senators and representatives, recognized Hance for his longtime contributions to the cooperative credit union movement as well as for his commitment to Rutland as an employer and the positive impact the credit union has had on the local workforce and economy. Hance plans to retire in early 2015. State Rep. Larry Cupoli (R-Rutland), left, presents the resolution to Hance. (Association of Vermont Credit Unions photo) ...

Chartway fully funds children's equine therapy program

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VIRGINIA BEACH, Va. (5/28/14)--The We Promise Foundation, the charitable arm of $1.9 billion-asset Chartway FCU, Virginia Beach, Va., donated $43,500 to help 40 children with disabilities benefit from equine-assisted therapeutic riding lessons.
 
For the third straight year, the grant to EQUI-KIDS will help provide weekly riding lessons to help riders strengthen muscles and improve their balance and coordination. Just as importantly, sessions will provide lessons in communication and socialization as children bond with horses and learn from instructors.
 
"Our foundation and its supporters and volunteers are deeply dedicated to making a difference in our communities," said John Blum, We Promise Foundation chairman. "The joy and freedom children experience, the leadership skills they gain, and the therapeutic progress they make is remarkable. This program is unmatched, and we are humbled to help children who can benefit from it."
 
For a person whose disability confines them to a wheelchair, riding lessons provide independence and a rare chance to move with strength and grace, according to EQUI-KIDS. For a child with autism spectrum disorder who rarely speaks or avoids eye contact and touch, lessons break boundaries, helping children connect with both animals and people.

Special Bellco loans to help post-hailstorm recovery

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The parking lot of Bellco FCU, Wyomissing, Pa., was covered with hail after last week's storm. (Pennsylvania Credit Union Association photo)

HARRISBURG, Pa. (5/28/14)--A severe storm that dropped hailstones as large as golf balls prompted Wyomissing, Pa.-based Bellco FCU to offer special loan rates for auto and home repairs.

The $107 million-asset credit union itself suffered damage at its Wyomissing branch, and some cars belonging to staff and members were totaled (Life is a Highway May 27).
 
In response to the losses, Bellco is offering a 0.5% discount rate on auto, home and unsecured loans to replace cars and fix damaged homes.
 
"We are just trying to help our neighbors get back to normal and move on," said CEO Tom Gosling.
 
The May 22 storm hit Berks and Lehigh counties, shattering car windows and damaging homes and businesses. It also smashed through the skylights at the Berkshire Mall in Wyomissing. Hail accumulations were as deep as 1 1/2 inches (WCAU-NBC 10 May 23).

Two teachers to have mortgages covered by CU for excellence

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PORTLAND, Ore. (5/28/14)--For one teacher's work helping students get on track to college, and another's efforts to inspire students to think critically and engage, a Portland, Ore.,-based credit union has named each the 2014 Educators of the Year and, for that honor, will make their mortgage payments for one school year.   

OnPoint Community CU, with $3.3 billion in assets, announced last week that Elizabeth Lawson, a fifth-grade teacher from Vancouver, Wash., was named K-8 Educator of the Year, and Susan Bartley, a high school English teacher from Portland, was named 9-12 Educator of the Year.

The OnPoint Prize for Excellence in Education recognizes teachers from Oregon and southwest Washington for their ability to foment creativity, inspire and positively impact students.

In addition to covering their mortgages for the next year, the credit union will donate $1,000 to each teacher's school to pay for various resources and supplies.

Four other finalists received $500 personally and $500 for their schools.

"Our annual OnPoint Prize award celebrates extraordinary teachers whose work sparks enthusiasm and passion in students and their parents," said Rob Stuart, OnPoint president/CEO. "This award is an opportunity to recognize the educators who make a difference in the lives of students and the communities where we live."

Bartley earned the award for her role in developing an Advanced Placement (AP) program at her school, which requires students to pledge to take at least four college-level courses, meet twice a month with a mentor and apply to at least three colleges (OregonLive.com May 26).

Enrollment in Bartley's AP class has climbed to 40% of students of color, special education students or English language learners, as a result of her focus on diversity and equity work.

Lawson, meanwhile, was recognized for fostering an environment of engaged students, which she built on the principles of mutual trust, empowerment and critical thinking.

Lawson works collaboratively with teachers, parents and students to create a community of lifelong learners, and has been called an inspirational leader among peers.

Crowdfunding exemption starts June 1 in Wis.

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MADISON, Wis. (5/28/14)--Wisconsin businesses will be able to raise money through Internet crowdfunding under a new law that takes effect June 1, and credit unions are among the financial institutions that can hold contributions.
 
The law, approved by the state legislature and signed by Gov. Scott Walker, allows a Wisconsin business to raise up to $1 million from state investors through crowdfunding portals. The amount can be increased to $2 million if the issuer has had an audit in its most recent fiscal year, and has provided the audit to prospective investors and the Department of Financial Institutions (DFI).
 
"This change could result in new opportunities for Wisconsin entrepreneurs to raise capital and launch new businesses, thereby creating jobs and helping the state's economy to grow," said Patricia Struck, DFI Division of Securities administrator. "As with any investment opportunity, we encourage consumers to do their homework in advance and make sure the investment is right for them."
 
To qualify for the state securities exemption, issuers must:
  • File a notice with the Division of Securities through the DFI website at least 10 days before the offering;
  • Comply with the "intrastate" federal law exemption under federal law, meaning that all offers and sales must be to Wisconsin investors;
  • Make the offer available through one or more Internet sites;
  • Provide a copy of the disclosure document to each prospective investor; and
  • Hold all payments in escrow in a Wisconsin-chartered financial institution and not access them until the target offering amount has been raised;
  • Provide a quarterly report to investors;
  • Not be subject to the "bad actor" disqualification under federal securities law.
The new law also regulates Internet site operators used in crowdfunding. The Internet site operators must be organized under Wisconsin law and authorized to do business in Wisconsin. Businesses must also be registered with the state Division of Securities. Records of offers and securities sales must be maintained on the Internet site.

CUNA Mutual's Davidson to retire June 2

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MADISON, Wis. (5/28/14)--Risk management expert Ann Davidson will retire from CUNA Mutual Group June 2.
 
Davidson has spent 40 years working with the credit union industry, specializing in fraud prevention and compliance, payments systems and risk management.
 
 "It's been a privilege to work with credit unions these many years to help educate and protect them against the many risks and loss scenarios they face in their everyday business," Davidson said.
 
In addition to her speaking and training activities, she has been responsible for researching and analyzing emerging risks for product development.
 
Davidson began her career with CUNA Mutual Group in 1974 and has worked in claims, underwriting and loss prevention within the Credit Union Protection division.

UW only CU bestowed with EPA 100% Green Power title

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MADISON, Wis. (5/28/14)--UW CU is among the businesses featured on the Environmental Protection Agency's (EPA) list of companies that use 100% green power for their electricity needs.
 
Since 2013, the $1.7 billion-asset, Madison, Wis.-based credit union has purchased wind energy to power its community branch locations and corporate office.
 
"Making our communities healthier places to live and work is a priority for us," said Paul Kundert, UW CU president/CEO. "Just as we look out for members' financial best interests, we believe in protecting the environment for future generations."
 
UW CU is ranked 161 out of 639 companies nationwide for the amount of green power purchased. It is the fifth-largest company in Wisconsin that purchases 100% green power and the only Wisconsin-based financial institution to do so. The green power purchased by the credit union will eliminate an estimated 2,569 metric tons of carbon dioxide emissions, which is the equivalent of the greenhouse gas emissions from 541 passenger vehicles each year.
 
In 2013, UW CU became the first credit union in the nation to receive the EPA Green Power Leadership Club distinction for its commitment to purchasing green power. It also was one of eight organizations to receive the EPA Green Power Leadership Club Award for its contribution in advancing the development of the nation's voluntary green power market.
 
UW CU has been an EPA Green Power Partner since 2011.

Expect more tech spending, especially in mobile: CUNA

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MADISON, Wis. (5/28/14)--According to the latest Technology Spending Survey from the Credit Union National Association, nearly 50% of credit unions increased their technology budgets compared with last year, putting a higher priority on mobile banking.
 
The 2014 survey, spotlighted in the June issue of Credit Union Magazine, noted that larger credit unions had the largest increases in their budgets compared with last year. Twenty-eight percent of credit unions with $500 million in assets bumped their spending by more than 10% compared with 2013. Another 25% nudged their tech budgets up between 6% and 10%.
 
Smaller credit unions--those with less than $50 million in assets--said their tech budgets would remain the same.
 
In the hardware category, iPads and tablets are being purchased for CEOs (30%), senior management (27%) and directors (25%).
 
Of the credit unions responding to the survey, 97% offer online banking, and just over 40% of members who have checking accounts are signed up for online banking.
 
The transactions least likely to be included in online banking are making person-to-person payments, applying for a mortgage, transferring funds to a different financial institution  or opening an account as a new member.
 
Credit unions have been quick off the block for mobile banking with 60% of respondents offering this service. Asset size appears to be a factor in this category: 100% of credit unions with more than $500 million in assets offer mobile banking, while the credit unions that have no plans to launch the service have less than $50 million in assets.
 
This is the first part of CUNA's 2014 Technology Spending Survey, which will be published in its entirety this fall.

Filene: Fin. lit., debt challenges continue for Gen Y

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MADISON, Wis. (5/28/14)--Millennials have a difficult time grappling with debt--which they shoulder at a high rate--and don't demonstrate strong levels of financial literacy, a report by Filene Research Institute has found.

The findings are drawn from the first of four reports from Filene that will be released as part of a broader National Financial Capability Study, an effort that seeks to ferret out indicators of financial capability and evaluate how these indicators change between demographics (See News Now Dec. 18, 2013).

Two-thirds of "Gen Yers," or those born between the late 1970s and mid-1990s, bear at least one type of outstanding, long-term debt, such as student loans, mortgages or car loans, the report found. About 30% are dealing with two or more.  
 
Further, more than 50% of credit card users report carrying a balance in the past year, and nearly 70% of respondents--5,500 in all--rated themselves as highly financially knowledgeable, despite the report also finding pervasive poor financial literacy based on responses to financial questions posed during the study.   

Given their experience with financial education, credit unions have an opportunity to intervene and help address the growing problem, researchers said. 

"With tactics that focus on debt management and financial literacy, credit unions can target the most problematic areas for Generation Y," researchers from George Washington University, a partner on the study, wrote.

Researchers also found that overconfidence and a reliance on alternative financial services, such as payday loans or pawn shops, exacerbates the financial problems.
 
The authors of the report also listed other insights credit unions should be mindful of:

"Gen Yers may be ambitious and driven, but a closer analysis reveals a generation deeply indebted and relying too heavily on alternative financial services," the authors wrote. "Credit unions should promote financial literacy through products and real-life behaviors in order to create a meaningful impact with young adults."

  • Debt management tactics will resonate with millennials, such as helping individuals understand sources of debt;
     
  • Millennials are difficult to engage, especially when many believe they already comprehend their financial situations;
     
  • A college degree doesn't guarantee financial literacy, even for those with high levels of education; and
     
  • Millennials access high-cost borrowing products too often.

Expect more tech spending, especially in mobile: CUNA

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MADISON, Wis. (5/28/14)--According to the latest Technology Spending Survey from the Credit Union National Association, nearly 50% of credit unions increased their technology budgets compared with last year, putting a higher priority on mobile banking.
 
The 2014 survey, spotlighted in the June issue of Credit Union Magazine , noted that larger credit unions had the largest increases in their budgets compared with last year. Twenty-eight percent of credit unions with $500 million in assets bumped their spending by more than 10% compared with 2013. Another 25% nudged their tech budgets up between 6% and 10%.
 
Smaller credit unions--those with less than $50 million in assets--said their tech budgets would remain the same.
 
In the hardware category, iPads and tablets are being purchased for CEOs (30%), senior management (27%) and directors (25%).
 
Of the credit unions responding to the survey, 97% offer online banking, and just over 40% of members who have checking accounts are signed up for online banking.
 
The transactions least likely to be included in online banking are making person-to-person payments, applying for a mortgage, transferring funds to a different financial institution  or opening an account as a new member.
 
Credit unions have been quick off the block for mobile banking with 60% of respondents offering this service. Asset size appears to be a factor in this category: 100% of credit unions with more than $500 million in assets offer mobile banking, while the credit unions that have no plans to launch the service have less than $50 million in assets.
 
This is the first part of CUNA's 2014 Technology Spending Survey, which will be published in its entirety this fall.

Filene: Fin. lit., debt challenges continue for Gen Y

 Permanent link
MADISON, Wis. (5/28/14)--Millennials have a difficult time grappling with debt--which they shoulder at a high rate--and don't demonstrate strong levels of financial literacy, a report by Filene Research Institute has found.

The findings are drawn from the first of four reports from Filene that will be released as part of a broader National Financial Capability Study, an effort that seeks to ferret out indicators of financial capability and evaluate how these indicators change between demographics (See News Now Dec. 18, 2013).

Two-thirds of "Gen Yers," or those born between the late 1970s and mid-1990s, bear at least one type of outstanding, long-term debt, such as student loans, mortgages or car loans, the report found. About 30% are dealing with two or more.  
 
Further, more than 50% of credit card users report carrying a balance in the past year, and nearly 70% of respondents--5,500 in all--rated themselves as highly financially knowledgeable, despite the report also finding pervasive poor financial literacy based on responses to financial questions posed during the study.   

Given their experience with financial education, credit unions have an opportunity to intervene and help address the growing problem, researchers said. 

"With tactics that focus on debt management and financial literacy, credit unions can target the most problematic areas for Generation Y," researchers from George Washington University, a partner on the study, wrote.

Researchers also found that overconfidence and a reliance on alternative financial services, such as payday loans or pawn shops, exacerbates the financial problems.
 
The authors of the report also listed other insights credit unions should be mindful of:
  • Debt management tactics will resonate with millennials, such as helping individuals understand sources of debt;
     
  • Millennials are difficult to engage, especially when many believe they already comprehend their financial situations;
     
  • A college degree doesn't guarantee financial literacy, even for those with high levels of education; and
     
  • Millennials access high-cost borrowing products too often.
"Gen Yers may be ambitious and driven, but a closer analysis reveals a generation deeply indebted and relying too heavily on alternative financial services," the authors wrote. "Credit unions should promote financial literacy through products and real-life behaviors in order to create a meaningful impact with young adults."

UW only CU bestowed with EPA 100% Green Power title

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MADISON, Wis. (5/28/14)--UW CU is among the businesses featured on the Environmental Protection Agency's (EPA) list of companies that use 100% green power for their electricity needs.
 
Since 2013, the $1.7 billion-asset, Madison, Wis.-based credit union has purchased wind energy to power its community branch locations and corporate office.
 
"Making our communities healthier places to live and work is a priority for us," said Paul Kundert, UW CU president/CEO. "Just as we look out for members' financial best interests, we believe in protecting the environment for future generations."
 
UW CU is ranked 161 out of 639 companies nationwide for the amount of green power purchased. It is the fifth-largest company in Wisconsin that purchases 100% green power and the only Wisconsin-based financial institution to do so. The green power purchased by the credit union will eliminate an estimated 2,569 metric tons of carbon dioxide emissions, which is the equivalent of the greenhouse gas emissions from 541 passenger vehicles each year.
 
In 2013, UW CU became the first credit union in the nation to receive the EPA Green Power Leadership Club distinction for its commitment to purchasing green power. It also was one of eight organizations to receive the EPA Green Power Leadership Club Award for its contribution in advancing the development of the nation's voluntary green power market.
 
UW CU has been an EPA Green Power Partner since 2011.

CU System brief (05/28/2014)

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  • COLCHESTER, Vt. (5/28/14)-- The Vermont Legislature honored Ron Hance, president/CEO of Heritage Family FCU, Rutland, with $347 million in assets, for his nearly 40 years of service to the credit union movement ( NewsLines Express May 23). House Concurrent Resolution 342, offered by both state senators and representatives, recognized Hance for his longtime contributions to the cooperative credit union movement as well as for his commitment to Rutland as an employer and the positive impact the credit union has had on the local workforce and economy. Hance plans to retire in early 2015. State Rep. Larry Cupoli (R-Rutland), left, presents the resolution to Hance. (Association of Vermont Credit Unions photo) ...

Crowdfunding exemption starts June 1 in Wis.

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MADISON, Wis. (5/28/14)--Wisconsin businesses will be able to raise money through Internet crowdfunding under a new law that takes effect June 1, and credit unions are among the financial institutions that can hold contributions.
 
The law, approved by the state legislature and signed by Gov. Scott Walker, allows a Wisconsin business to raise up to $1 million from state investors through crowdfunding portals. The amount can be increased to $2 million if the issuer has had an audit in its most recent fiscal year, and has provided the audit to prospective investors and the Department of Financial Institutions (DFI).
 
"This change could result in new opportunities for Wisconsin entrepreneurs to raise capital and launch new businesses, thereby creating jobs and helping the state's economy to grow," said Patricia Struck, DFI Division of Securities administrator. "As with any investment opportunity, we encourage consumers to do their homework in advance and make sure the investment is right for them."
 
To qualify for the state securities exemption, issuers must:
  • File a notice with the Division of Securities through the DFI website at least 10 days before the offering;
  • Comply with the "intrastate" federal law exemption under federal law, meaning that all offers and sales must be to Wisconsin investors;
  • Make the offer available through one or more Internet sites;
  • Provide a copy of the disclosure document to each prospective investor; and
  • Hold all payments in escrow in a Wisconsin-chartered financial institution and not access them until the target offering amount has been raised;
  • Provide a quarterly report to investors;
  • Not be subject to the "bad actor" disqualification under federal securities law.
The new law also regulates Internet site operators used in crowdfunding. The Internet site operators must be organized under Wisconsin law and authorized to do business in Wisconsin. Businesses must also be registered with the state Division of Securities. Records of offers and securities sales must be maintained on the Internet site.

CUNA Mutual's Davidson to retire June 2

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MADISON, Wis. (5/28/14)--Risk management expert Ann Davidson will retire from CUNA Mutual Group June 2.
 
Davidson has spent 40 years working with the credit union industry, specializing in fraud prevention and compliance, payments systems and risk management.
 
 "It's been a privilege to work with credit unions these many years to help educate and protect them against the many risks and loss scenarios they face in their everyday business," Davidson said.
 
In addition to her speaking and training activities, she has been responsible for researching and analyzing emerging risks for product development.
 
Davidson began her career with CUNA Mutual Group in 1974 and has worked in claims, underwriting and loss prevention within the Credit Union Protection division.

Two teachers to have mortgages covered by CU for excellence

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PORTLAND, Ore. (5/28/14)--For one teacher's work helping students get on track to college, and another's efforts to inspire students to think critically and engage, a Portland, Ore.,-based credit union has named each the 2014 Educators of the Year and, for that honor, will make their mortgage payments for one school year.   

OnPoint Community CU, with $3.3 billion in assets, announced last week that Elizabeth Lawson, a fifth-grade teacher from Vancouver, Wash., was named K-8 Educator of the Year, and Susan Bartley, a high school English teacher from Portland, was named 9-12 Educator of the Year.

The OnPoint Prize for Excellence in Education recognizes teachers from Oregon and southwest Washington for their ability to foment creativity, inspire and positively impact students.

In addition to covering their mortgages for the next year, the credit union will donate $1,000 to each teacher's school to pay for various resources and supplies.

Four other finalists received $500 personally and $500 for their schools.

"Our annual OnPoint Prize award celebrates extraordinary teachers whose work sparks enthusiasm and passion in students and their parents," said Rob Stuart, OnPoint president/CEO. "This award is an opportunity to recognize the educators who make a difference in the lives of students and the communities where we live."

Bartley earned the award for her role in developing an Advanced Placement (AP) program at her school, which requires students to pledge to take at least four college-level courses, meet twice a month with a mentor and apply to at least three colleges ( OregonLive.com May 26).

Enrollment in Bartley's AP class has climbed to 40% of students of color, special education students or English language learners, as a result of her focus on diversity and equity work.

Lawson, meanwhile, was recognized for fostering an environment of engaged students, which she built on the principles of mutual trust, empowerment and critical thinking.

Lawson works collaboratively with teachers, parents and students to create a community of lifelong learners, and has been called an inspirational leader among peers.

Chartway fully funds children's equine therapy program

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VIRGINIA BEACH, Va. (5/28/14)--The We Promise Foundation, the charitable arm of $1.9 billion-asset Chartway FCU, Virginia Beach, Va., donated $43,500 to help 40 children with disabilities benefit from equine-assisted therapeutic riding lessons.
 
For the third straight year, the grant to EQUI-KIDS will help provide weekly riding lessons to help riders strengthen muscles and improve their balance and coordination. Just as importantly, sessions will provide lessons in communication and socialization as children bond with horses and learn from instructors.
 
"Our foundation and its supporters and volunteers are deeply dedicated to making a difference in our communities," said John Blum, We Promise Foundation chairman. "The joy and freedom children experience, the leadership skills they gain, and the therapeutic progress they make is remarkable. This program is unmatched, and we are humbled to help children who can benefit from it."
 
For a person whose disability confines them to a wheelchair, riding lessons provide independence and a rare chance to move with strength and grace, according to EQUI-KIDS. For a child with autism spectrum disorder who rarely speaks or avoids eye contact and touch, lessons break boundaries, helping children connect with both animals and people.

Special Bellco loans to help post-hailstorm recovery

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HARRISBURG, Pa. (5/28/14)--A severe storm that dropped hailstones as large as golf balls prompted Wyomissing, Pa.-based Bellco FCU to offer special loan rates for auto and home repairs.
 
The parking lot of Bellco FCU, Wyomissing, Pa., was covered with hail after last week's storm. (Pennsylvania Credit Union Association photo)
The $107 million-asset credit union itself suffered damage at its Wyomissing branch, and some cars belonging to staff and members were totaled ( Life is a Highway May 27).
 
In response to the losses, Bellco is offering a 0.5% discount rate on auto, home and unsecured loans to replace cars and fix damaged homes.
 
"We are just trying to help our neighbors get back to normal and move on," said CEO Tom Gosling.
 
The May 22 storm hit Berks and Lehigh counties, shattering car windows and damaging homes and businesses. It also smashed through the skylights at the Berkshire Mall in Wyomissing. Hail accumulations were as deep as 1 1/2 inches ( WCAU-NBC 10 May 23).

CU System briefs (05/27/14)

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  • COLCHESTER, Vt. (5/27/14)--The Association of Vermont Credit Unions elected its board members and executive committee at its recent annual meeting (NewsLines Express May 23). Bernie Isabelle, president/CEO, Vermont FCU, Burlington, with $394 million in assets, and Jeff Morse, president/CEO, River Valley CU, Brattleboro, with $73 million in assets, were re-elected to three-year terms. Carrie Allen, senior vice president of business development, Heritage Family FCU, Rutland, with $347 million in assets, was elected to the board for the first time. Officers are Chair Sean Gammon, president/CEO, Members Advantage Community CU, Barre, with $82 million in assets, and Vice Chair Susan Poczobut, president/CEO, Granite Hills CU, Barre, with $34 million in assets. Morse and Isabelle will serve as treasurer and secretary, respectively. Other directors are Bob Morgan, president/CEO, NorthCountry FCU, South Burlington, with $435 million in assets, and Jim St. Peter, senior operations director, New England FCU, Williston, with $988 million in assets. Susan Best, loan officer, ORLEX Government Employees CU, Newport, with $5 million in assets, retired from the board after nine years as secretary ...
  • HELENA, Mont. (5/27/14)--Montana's Credit Unions for Community Development (MCUCD) awarded its Philosophy in Action Award to the Student Assistance Foundation (SAF)--the first time the award has been given to an organization outside of the immediate credit union family. Karen Smith, MCUCD executive director, said SAF deserves the award because of its long-term commitment to the Matched Education Savings Account program, which helps students with limited incomes save for college by matching funds and establishing savings habits. SAF has helped MCUCD with the savings account program by connecting it with school partners, providing financial education to participants and promoting the program. Kelly Cresswell, vice president of foundation activities, Student Assistance Foundation, left, and Karen Smith, executive director, Montana's Credit Unions for Community Development (MCUCD photo) ...
  • LYNCHBURG, Va. (5/27/14)--The Credit Unions Care Foundation of Virginia contributed $10,000 to the Anthem LemonAid Campaign benefiting the Children's Miracle Network Hospitals in Richmond and Hampton Roads, Va. LemonAid stands will be set up in both areas of the state--as well as online--July 18-20, with each donated dollar going to Children's Hospital of the King's Daughters, Norfolk, and Children's Hospital of Richmond at Virginia Commonwealth University. Each hospital has a $15,000 campaign goal ...

Maine membership movement makes media mark

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WESTBROOK, Maine (5/27/14)--The media in Maine has gobbled up recent news of strong growth at the state's credit unions, described in the 2013 year-end statistics released by the Maine Credit Union League last month.

Newspapers, local television affiliates and radio shows have particularly honed in on membership growth at credit unions in Maine, reporting the trend of 40,000 new members over the past six years (Weekly Update May 23).

"Adding 40,000 new members since the Great Recession in 2008 is a real positive story," said league president John Murphy. "Our hard work in cultivating strong media relationships throughout the state paid dividends by giving us the opportunity to tell our story and tout our growth."

Over the past month, league representatives have sat down for a multitude of interviews for stories that have appeared in publications such as the Portland Press Herald, the Kennebec Journal, The Morning Sentinel, the Times Record and the Journal Tribune.

League leaders also gave a lengthy interview on a popular morning radio news show in Maine, "The WGAN Morning News with Ken and Mike" on 560 WGAN, and have provided content for news stories airing on radio stations across the state.

Representatives have appeared in news briefs on a handful of TV stations as well, including WGME CBS 13, WAGM TV, WABI TV 5 and WVII ABC 7.

Often, the stories and interviews remind consumers that Maine credit unions feature the largest surcharge-free ATM network, a shared-branch network with nearly three times more branches than any bank in the state, new technology with mobile deposit, and the benefits of the cooperative structure of credit unions.

THINK 14 raises $126K for CMNH

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RANCHO CUCAMONGA, Calif. (5/27/14)--Participants and credit union organizations donated $126,500 to Children's Miracle Network Hospitals at CO-OP Financial Services' THINK 14 Conference held last week in New Orleans.
 

The donations included $75,000 from Transaction Network Services Inc. and $25,000 from FIS.
 
The $126,500 in contributions sets a record for charitable giving during a THINK conference, CO-OP said.
 
"The amount donated to CMN Hospitals during THINK 14 is a testimony to the people-helping-people ethic of credit unions," said Stan Hollen, president/CEO of CO-OP Financial Services, Rancho Cucamonga, Calif. "It's not just a slogan; people in this industry really are committed to the well-being of others."
 
A tradition of the THINK conferences, the 2014 meeting included charitable events for attendees on May 19 and May 22. Activities included a golf tournament, a New Orleans city tour, a Garden District tour, an "Airboat Swamp Romp," a cooking demonstration of traditional New Orleans delicacies and "Miracle Jeans Day." The amount contributed by participants totaled $13,000.
 
In addition, $823 million-asset 1st United Services CU of Pleasanton, Calif.; $1.3 billion-asset Elevations CU of Boulder, Colo.; Mitchell, Stankovic, & Associates, Boulder City, Nev.; and $1.2 billion-asset Vantage West CU of Tucson, Ariz., made contributions totaling $3,500.
 
Event host CO-OP donated $10,000. This is in addition to the $1 million CO-OP donates on behalf of its member institutions to Credit Unions for Kids fundraisers annually through the CO-OP Miracle Match program.

Click to view larger image Transaction Network Services donated $75,000 to Children's Miracle Network Hospitals during the THINK 14 conference, part of a total of $126,500 raised during the conference. At the check presentation are, from left, Joe Dearborn, senior director, CMN Hospitals; Mike Keegan, co-chief executive officer, Transaction Network Services; and Caroline Willard, executive vice president, markets and strategy, for conference sponsor CO-OP Financial Services. (Photo provided by CO-OP Financial Services)

Local Gov't FCU commits $7M to UNC-Chapel Hill gov't school

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RALEIGH, N.C. (5/27/14)--Local Government FCU (LGFCU), Raleigh, N.C., with $1.3 billion assets, has pledged $7.1 million to the University of North Carolina at Chapel Hill for initiatives to support state local governments.
 
The pledge will go to several programs, including $2.84 million over the next decade for the school's Development Finance Initiative (DFI), which helps economically distressed communities attract private investment with new financial tools.
 
Another $2.22 million will go to a fellowship program to develop new local government leaders, and $2.04 million will be invested in the school's innovation fund.
 
In 2011, LGFCU granted the UNC's School of Government $1 million to partner with local governments to attract private investment for transformative projects by providing specialized finance and development expertise.
 
Since that time, DFI has worked on more than 50 projects in nearly 40 communities in North Carolina. Projects range from analysis of a historic downtown building to an assessment of district-wide financial tools to attract private investment to distressed neighborhoods.
 
With the new grant, DFI will continue to work with existing local partners to move their projects from pre-development to development, while exploring new partnership opportunities for development in additional communities.
 
"The initial investment that LGFCU made in the Development Finance Initiative and the LGFCU Fellows program continues to deliver on its intended purpose of enhancing North Carolina communities at the local level," said Maurice Smith, LGFCU president/CEO. "We believe continued support of these initiatives is a wise and fitting investment in the North Carolina communities where our members live and work."

Members' down-payment savings matched by CU

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TEMPE, Ariz., (5/27/14)--TruWest CU, Tempe, Ariz., with $826 million in assets, is helping make homeownership more attainable for its members through a federal funds program.

The Workforce Initiative Subsidy for Homeownership (WISH) program pairs low- to middle-income families with the funds necessary to achieve the dream of homeownership.
 
WISH provides up to $15,000 for each household, matching up to $3 for each $1 saved by the homebuyer, to be used for the down payment and closing costs involved with purchasing a home. Grant funds are available on a first-come, first-serve basis.
 
"The most difficult obstacle for me to overcome in buying a home for my family was coming up with the down payment," says Dustin L., a recent WISH recipient. "The process was easy. In fact, I applied online at truwest.org, and within a week completed the housing counseling course that the WISH program requires. Within a month, I found my house and made an offer."
 
Program applicants must:
  • Complete a free counseling program;
  • Be first-time homebuyers;
  • Meet income eligibility guidelines;
  • Open escrow on a home purchase prior to March 31, 2015;
  • Meet normal credit qualifications; and
  • Not have a combined household income exceeding certain limits.Members' down-payment savings matched by CU
     

Compromised non-payment card data on the rise: Trustwave

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CHICAGO (5/27/14)--Payment card data continues to lead the way in the type of online information most often compromised by data breaches, but data thefts involving non-payment card data is gaining ground, according to analysis from online security technology company Trustwave.

Last week, Trustwave released a report digging into trends in cybercrime, data breaches and security threats.

The report analyzed topics such as what type of information is targeted, which industries are most targeted and how criminals gained access to that information.

While payment card data topped the list of data most-compromised, 45% of data thefts last year involved confidential, non-payment card data, a 33% jump from 2012.

Non-payment card data includes sensitive information such as financial credentials, internal communications and personal information such as names and birthdates.
The Trustwave report also found:

"Security is a process that involves foresight, manpower, advanced skillsets, threat intelligence and technologies," said Robert J. McCullen, Trustwave CEO. "If businesses are not fully equipped with all of these components, they are only increasing their chances of being the next data breach victim."

The Credit Union National Association continues to urge federal lawmakers to pass legislation that would place merchants and financial institutions such as credit unions on a level playing field.

Merchants, CUNA leaders have said, aren't beholden to the same security standards that financial institutions must adhere to.

Trustwave experts compiled the data from 691 breach investigations in 2013--a number that increased from 54% since 2012--across 24 countries, among other sources, to complete the report.

  • The United States is home to the most victims of data breaches at 59%;
     
  • Retail was the top industry compromised, making up 35% of the beaches, with food and beverage second at 18% and hospitality third at 11%;
     
  • Malware was the most popular method of extracting data illegally;
     
  • Spam made up to 70% of inbound emails, though malicious spam dropped by 5% in 2013;
     
  • Weak passwords led to the initial intrusion of 31% of compromises; and
     
  • "123456" topped the list of most commonly used passwords, followed by "123456789," "1234," and "password."

CUs do more than close in honor of Memorial Day

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MADISON, Wis. (5/27/14)--Credit unions and other financial institutions often close their doors in observance of Memorial Day, but many credit unions throughout the country found additional ways to honor the military this year for Memorial Day, and for National Military Appreciation Month.

Click to view larger image Arizona State CU hangs a banner and flags to recognize fallen heroes for their service. (Business Wire photo)
For example, Arizona State CU gained national coverage for its decision to hang all 27 versions of the American Flag on its headquarters in Phoenix to celebrate the national holiday Monday.

The flags will hang from May 22-28, and a banner reading "Honoring Fallen Heroes" will grace the southwest side of the building (Reuters May 22).

"It is important to recognize the sacrifices of the heroes who safeguard our nation," said David E. Doss, president/CEO of the $1.6 billion credit union. "On behalf of Arizona State Credit Union associates, we would like to thank our servicemen and women for everything that they do, and we wish all Arizonans a happy and safe Memorial Day."

InTouch CU, Plano, Texas, with $811 million in assets, will match donations made at its branches this month to the Cell Phones for Soldiers organization, which raises funds by recycling used cell phones (Daily Tribune May 22).

The funds are used to purchase prepaid international calling cards for servicemembers stationed overseas to call loved ones back home (See News Now May 20: Financial worries challenge nation's servicemembers).

America's Christian CU (ACCU), Glendora, Calif., with $278 million in assets, will host Patriot Week this week in celebration of military heroes and first responders at their headquarters in Glendora.

The celebration has been put together in partnership with Project Glendora Yellow Ribbon, a grassroots outfit aiming to gain public recognition for Glendorans serving in the military.

The week starts off with opening ceremonies today, where city officials, military groups and community members will dedicate the week to celebrating and expressing gratitude for their local military heroes.

ACCU also will donate $10 to Project Glendora for every new account opened at the Glendora branch during Patriot Week to raise funds to replace banners that have been damaged by recent strong wins and storms.

Meanwhile, several Illinois-based credit unions have been working to support military members all year.

More than 140 gravesites at the Abraham Lincoln National Cemetery were recently decorated with wreaths thanks to a sponsorship by NuMark CU, Joliet, Ill., with $187 million in assets; and Alliant CU, Chicago, with $8 billion in assets, recently was recognized by the Professional Women's Foundation for its work in helping women veteran's gain access to financial literacy resources.

Other ways credit unions celebrated Memorial Day:

  • Dover-Phila FCU, Dover, Ohio, with $354 million in assets, was credited by the organizer of a 2K race on Memorial Day for approaching her about hosting the event. The credit union is a major sponsor of the race, called Color US United 2K Run (TimesReporter.com May 21). 
     
  • Bay Area CU, Oregon, Ohio, with $54 million in assets, launched a Facebook campaign where the credit union has created an "honor wall" where they posted numerous photos of past and present servicemembers.

CUNA closed Monday for holiday, no News Now(1)

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WASHINGTON and MADISON, Wis. (5/23/14)--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 publish a Monday issue but will resume regular publication on Tuesday.

CU System briefs (05/23/2014)

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  • BOISE, Idaho (5/23/14)-- Dr. Larry Neznanski, board chair for Capital Educators FCU, Meridian, Idaho, received the Volunteer of the Year award from the Idaho Credit Union League . He has been on the nominating committee for the $365 million-asset credit union's Teacher Grant program, where he recommends grant recipients, attends grant presentations, participates in events to recognize teachers, and seeks ways to maximize the credit union's reach to get dollars into the classroom. Neznanski has been a credit union volunteer for 17 years ...
     
  • GREENWOOD VILLAGE, Colo. (5/23/14)-- The American Red Cross has been in the state of Colorado for 100 years, and Bellco CU, Greenwood Village, is contributing to the celebration . All 21 branches of the $2.4 billion-asset credit union are handing out free "Celebrating a Century in Colorado" bracelets to help spread the word and encourage donations by phone or in person. In June, American Red Cross experts will give free disaster preparedness workshops in three of Bellco's branches. Attendees will receive free USB drives that include critical disaster and financial preparedness ...
     
  • CHICAGO and WAYCROSS, Ga. (5/23/14)-- Eugene J. Stransky, president of CPT CU, Arlington Heights, Ill., died May 21 ( Chicago Tribune May 22). He was 75. Stranksky had been president of the $957,000-asset credit union for more than 35 years. He worked for telecommunications company Centel Corp. for 33 years. In Valdosta, Ga., Dr. Glen Willis Herrin died May 15 . He was 80 ( Waycross Journal-Herald May 20). A faculty member of the School of Business Administration of Valdosta State University, Herrin was instrumental in founding Valdosta Educators CU , which was merged into MEA FCU, a $67 million-asset credit union in Columbus, Ga., in 2011 ...

Complete mobile solution nets THINK 14 grand prize

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NEW ORLEANS (5/23/14)-­-A vision to consolidate the fragmented mobile banking environment earned the $10,000 CO-OP THINK Prize 14 for Christopher Whalen, Connex CU, North Haven, Conn.
 
CO-OP Financial Services announced the winner of the $10,000 CO-OP THINK Prize 14 Thursday. Caroline Willard, executive vice president of markets and strategy, CO-OP Financial Services (left), winner Christopher Whalen, marketing and e-services specialist, Connex CU, North Haven, Conn., and Chris Ensley, senior account manager of strategic partners, MasterCard. (CO-OP Financial Services photo)
Whalen, who is a marketing and e-services specialist for the $399 million-asset credit union, submitted "Mobile One: A Complete Financial Solution" for CO-OP's innovation contest.
 
Whalen explained that, "MobileOne will make mobile banking truly mobile banking. (The vision is) to consolidate fragmented mobile solutions from within and outside the credit union industry into one platform."
 
The two other finalists were:
  • Sanam Kazi, project coordinator; Chicago Patrolmen's FCU, with $378 million in assets, for "Customizable Website for Financial Education to Credit Union Members;" and
     
  • Brett Wooden, senior vice president of marketing and information technology, Cy Fair FCU, Houston, with $191 million in assets, for "Embrace a Child's Imagination to Develop Financial Literacy."
The $10,000 award to Whalen was presented by CO-OP Financial Services and CO-OP THINK Prize 14 sponsor MasterCard.
 
"Our goal with the CO-OP THINK Prize is to promote and inspire creative thinking on industry issues, and each of the three final business plans were wonderful displays of that," said Stan Hollen, CO-OP Financial Services president/CEO.
 
Though the ideas varied, the judging criteria for entries are based on four main standards--impact, creativity, aggregation (the application of the idea across the industry) and implementation (the ability to be adopted quickly).
 
Judges from CO-OP and the Filene Research Institute selected the three finalists, and the winner was determined by judges, online voters and registered THINK 14 attendees.

Maine league prepares for World Acadian Congress

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WESTBROOK, Maine (5/23/14)--The World Acadian Congress (WAC) 2014 is coming to Maine this August, and the Maine Credit Union League, a major sponsor of the event, wants credit union people there.

Slated for Aug. 8-24, the WAC is a 16-day celebration of Acadian heritage and culture. Acadians were French colonists who settled in parts of Maine and in what is now southeastern Canada.

Acadian Congress events will take place in Aroostook County, Quebec and New Brunswick, and the league announced this week it wants strong participation.

"Many Maine credit unions can trace their history back to the French Canadian culture and roots," said league president John Murphy. "So our support and partnership with the World Acadian Congress recognizes the connection."

Furthering its ties to Maine's Acadian heritage, the league also is the exclusive distributor and coordinator of the sales of World Acadian license plates, the first plates since the Bicentennial to be approved by Maine's Legislature for the front of vehicles.

Real-time transactions disrupt payments systems: E-Scan

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MADISON, Wis. (5/23/14)--For consumers who can't wait a second for their Candy Crush games to load, the idea of waiting days for payment transactions to be completed seems archaic. As the payments landscape changes, credit unions should be aware of the pieces that shift faster than falling red jelly beans or lemon drops.
 
"Consumers--especially younger consumers--demand immediacy in all areas of their lives," said Mark Sievewright, president of credit union solutions at Fiserv, in the June edition of Credit Union Magazine . "Even email seems too slow for younger consumers. They've come to expect the real-time benefits of instant messaging, texting and social media.
 
"When members have access to instant everything, waiting for anything seems passe," he noted.
 
"Real time" needs to apply to the entire payments process from start to finish--from initiating the payment though the funds settlement, Sievewright said. The challenge is to find an option that provides immediacy and meets regulatory standards.
 
Consumers accept costs for wire transfers and out-of-network services because of the convenience factor. Added Sievewright, "Many observers believe they'll pay for the same immediacy when it comes to other services."
 
Financial institutions that offer instant, person-to-person payment options--in addition to three-day and next-day payment options--see much higher adoption rates among potential users of the service, said Sievewright, pointing to research by Fiserv.
 
Sievewright's take on the changing payments landscape is only one of the topics covered in the newly released 2014-2015 Credit Union National Association Environmental Scan . CUNA's annual strategic planning resource also includes overviews of the economy, technology, board involvement, and the regulatory and legislative environment.

Ga. league documents state CU community outreach

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ATLANTA (5/23/14)--Georgia credit unions raised more than $1.68 million for charitable initiatives around the state, including $400,000 for Children's Miracle Network Hospitals, according to a Georgia Credit Union Affiliates (GCUA) survey.

"We are a service organization and our employees always enjoy giving back to our community," said survey respondent Debbie Smith, president/CEO, $957 million-asset Georgia United CU, Duluth. Her credit union donates a day of service on a federal holiday each year. In 2013 the Georgia United CU team assembled and donated 8,000 meal and hygiene kits for the Gateway Center homeless service organization, doubling the total from the previous year.
 
The Helping People Afford Life 2014 Outreach Report showed employees of responding credit unions donated an average of 385 hours in support of local causes, and 88% make direct monetary donations to charitable programs.
 
"Credit unions stand side-by-side with working people in the middle class," said Mike Mercer, GCUA president/CEO. "This means digging in right alongside them trying to make the lives of their families and their neighbors better. Credit unions exist to serve members and help them afford the lives they aspire to in the communities they care about."
 
Sometimes that means serving the global community. Platinum FCU, Lilburn, Ga., with $51 million in assets, raised more than $10,000 from members and staff, and the credit union contributed an additional $5,000 to the Aga Khan Foundation to support projects in developing countries in Africa and Asia.
 
"There are so many people in the world who are lacking the basic necessities that we take for granted," said Platinum FCU CEO Kabir Laiwalla. "We are a collaborative, cooperative organization. This gives us an opportunity to put the values of our credit union to work in areas of the world that can really benefit from our support."
 
More than half of credit unions surveyed offer or plan to offer programs designed specifically to help low-wealth members save. Eighty-eight percent offer used vehicle loans to low-wealth members, and 68% have credit builder programs. Almost 90% held financial educational events last year, with 13,747 Georgia consumers attending.
 
Additional findings from the report on Georgia credit unions' outreach activities include:
  • 75% have bilingual or multicultural staff;
  • 75% offer free checking accounts;
  • 68% have financial literacy programs for adults;
  • 84% have financial education programs for teens; and
  • 82% have financial education programs for youth.

CU advises big savings for big-ticket items

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KANSAS CITY, Mo. (5/23/14)--Big household items can mean big bills, but a commitment to saving can take a bite out of the balance, as WDAF-TV 4 learned from CommunityAmerica CU's Stephanie Wiley.
 
Wiley, one of the $1.8 billion-asset credit union's "Savin' Mavens," appeared on Wednesday's morning show on the Kansas City, Mo., TV station.
 
Around Memorial Day, retailers amp up the sales on major purchases such as computers, TVs and household appliances. Wiley offered tips for how to avoid overspending:
  • Always start with savings. Have a budget for these items and set aside funds in an account that's easily accessible to you when you need the money, Wiley said.
  • Avoid in-store credit deals. The "same as cash, zero percent" offers sound like a great plan, but if you don't pay it off within the allotted time, the interest can skyrocket to as much as 29%, she noted.
  • Look beyond the store. Consider purchasing used items by perusing Craigslist or checking thrift stores. If your heart is set on new items, comparison shop online and locally, Wiley advised.
To view the full video, use the resource link.

Advice pays off--by 79%--in retirement planning

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WASHINGTON (5/23/14)--A little help can go a long way for retirees.

Results of a study on people saving for retirement were released Thursday, revealing that investors who sought help, such as using a managed account or seeking out online advice, entered retirement with 79% more wealth than the average investor ( MarketWatch May 22).

The study was conducted by the global benefits consulting firm Aon Hewitt, which tracked hundreds of thousands of savers between 2006 and 2012.

More than one-third of retirement-plan participants relied on some kind of investment help and leveraged it into median returns every year that rose 3.32% higher than those who went it alone.

In the end, the study found, an investment of $10,000 brought in $32,800 to the investor working on his or her own, while that same investment ballooned to $58,700 for the person who sought out help.

Aon also found that, when looking for retirement help, younger savers opted for target-date funds, a popular offering for new employees at many companies.

While target-date funds helped investors, however, those who switched to a personalized investment plan put together by a financial adviser earned 50 basis points or about 0.5% more.

"A well-designed, risk-adjusted basket of low-cost index fund plus professional oversight gives you the best of both worlds," the author of the MarketWatch article wrote. "(It's) cheap and effective, especially in markets where you might be tempted to cash out of a target-date fund.

The study also found that six out of 10 investors working on their own took on inappropriate levels of risk, with some being exposed to risk higher than someone who's invested entirely in a stock portfolio.

NFCC provides 'snapshot' of consumers seeking financial counseling

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WASHINGTON (5/23/14)--The National Foundation for Credit Counseling (NFCC) has provided a picture of the typical consumer who came to an NFCC member agency for financial counseling in 2013, offering credit unions a benchmark to identify members who may be in need of education and advice.

"More than 1.5 million consumers reached out to an NFCC member agency last year for answers and solutions to their financial concerns around debt, housing, budgeting and bankruptcy.  Examining their financial profile can provide guidance for others, helping them determine their own level financial wellness," said Gail Cunningham, NFCC spokesperson.  
 
Among the characteristics of consumers who sought financial counseling from an NFCC member agency in 2013:
 
  • The No. 1 reason to seek counseling was "poor money management," eclipsing "reduced income" which had held the top spot since 2009.  An improving economy may put more money in people's pockets, but if not managed properly, it can still result in financial distress.
  • The age of the majority of consumers was fairly evenly divided between 25 to 54, with young adults in the 25 to 34 age group leading the way (24%), followed by the 35 to 44 range (23%), and the 45 to 54 group (21%). Financial problems can occur at any stage in a person's adult life which, if left unaddressed, can begin a negative spiral from which it can be difficult to recover.
  • The average household take-home income was $35,081, with an unsecured debt of $17,548, resulting in an unsecured debt-to-income ratio 0.50.  Owing too much relative to income resulting in a high debt-to-income ratio not only makes it harder to meet all debt obligations, but can hinder future borrowing.
  • Consumers seeking help carried an average of 5.7 credit cards. The number of credit cards a person has is not as important as how they manage them. Whatever the number of cards, maxing out the lines of credit will likely harm a person's credit score.
"Consumers are smart to contact a trusted organization for financial help," said Cunningham.  "However, the one mistake many of them have in common is that they wait too long to reach out for assistance.  Delaying taking action allows the problem to escalate, often causing financial damage that could have been prevented."

Global Women's Leadership Network Scholarship winners announced

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MADISON, Wis. (5/23/14)--Six women from Azerbaijan, Kenya, Liberia, Malawi, Thailand and the United States have been awarded a 2014 Global Women's Leadership Network scholarship, which promotes emerging women credit union leaders by providing them with access to a network of credit union professional expertise.
 
The 2014 Global Women's Leadership Network scholarship recipients include:
  • Nigar Agamaliyeva, administrative manager, Azerbaijan Credit Union Association, Azerbaijan;
  • Esther Cherono Keino, general manager, cooperative cevelopment, Belgut Rural Women SACCO, Kenya;
  • Kristi Lozano, financial education specialist, $748 million-asset San Mateo CU, Redwood City, Calif.;
  • Elenita V. San Roque, manager member services, Association of Asian Confederation of Credit Unions, Thailand;
  • Triza Tsiga Magreta, general manager, Mudi SACCO, Malawi; and
  • Kortoe D. Woloquelli, women's coordinator, Trust Savings Credit Union Women's Organization, Liberia;
 Scholarship recipients will join nearly 100 women from 13 countries for the sixth annual Global Women's Leadership Forum, July 26-27, and World Credit Union Conference, July 27-30, in Gold Coast, Australia. This year's agenda will feature Dr. Louise Mahler, renowned expert on vocal intelligence, as the keynote speaker. In 2013, more than 100 high-level female leaders worldwide participated in the Leadership Forum.

CU System briefs (05/22/2014)

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  • SAGINAW, Mich. (5/22/14)-- The Saginaw Arts and Enrichment Commission gave the All Area Arts Award to Catholic FCU, a $321 million-asset credit union in Saginaw, Mich. The award honors those that have contributed to improving the quality of life in Saginaw and the Great Lakes Bay Region. "Supporting the arts is part of our culture," said Bridget Looby, vice president of community development. Catholic FCU backs Jazz on Jefferson, Saginaw Bay Symphony Orchestra, Temple Theater and the Saginaw Art Museum, among others ...
  • HELENA, Mont. (5/22/14)-- The Montana Credit Union Network named Deanna Brost, manager of McCone County FCU, Circle, as the Montana Credit Union Professional of the Year ( President's Report May 16). Brost has been with the $60 million-asset credit union for more than 30 years, during which it received the Philosophy in Action Award from the Montana Credit Unions for Community Development ...

Minn. members share #whyIlovemyCU

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ST. PAUL, Minn. (5/22/14)--How, or why do Minnesotans love their credit unions? Let us count the ways. 

Click to view larger image Minnesota Valley FCU, Mankato, with $98 million in assets, collected its members' sentiments during the Minnesota Credit Union Network's "Why I Love My CU" social media campaign.
"Because it's people-helping-people, making each other's life easier, and dreams bigger," tweeted Pete Nohelty.

"(It) makes a positive impact in the community and in the lives of the members," tweeted Julie Frey.

"Because of friendly service, speedy service and no fees," testified Sherry, member of Spire FCU, Falcon Heights, Minn., with $607 million in assets, in a video posted on YouTube.

The Minnesota Credit Union Network recently launched the "Why I Love My Credit Union" campaign to spice up its advocacy and member outreach efforts.

The initiative asks credit union members from across the state to share what makes their not-for-profit- financial cooperative special to them through online story submissions, videos, social media posts and postcards.

Based on the volume of tweets, videos and written testaments that have been submitted, it so far appears to be a success.

A dedicated page on the league's website (use the resource link) is packed full of video testimonials, like one from Joanna, member of Affinity Plus CU, St. Paul, Minn., with $1.7 billion in assets, who loves her credit union because, "They're an advocate for me and for my financial well-being," and because, "I know when I have questions or when I need help managing my money I know they're going to be there for me. "

Meanwhile, since the launch of the campaign, Twitter has overflowed with reasons offered by members and employees of Minnesota credit unons about why they love their respective credit unions.

Reasons have ranged from the ease of securing a car loan, to because they trust the member-owned institution, to "being treated like a human being, not just another number," as one Affinity member explained in a tweet.

The league plans to share the stories submitted by members with various media outlets and others to "paint a full picture about how credit union members are an extraordinary bunch that takes pride in being a member-owner of their credit union."

CUs trounce banks regionally in NerdWallet's Consumer Banking Index

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SAN FRANCISCO (5/22/14)--At a regional level, credit unions, not banks, consistently and overwhelmingly had all the features that consumers want in their financial institution, according to the latest Consumer Banking Index from NerdWallet .
 
The consumer finance website evaluated the 150 largest credit unions and the 150 largest banks in the country on seven key factors that it found consumers desire from their financial institutions:
  • Free checking;
  • High-yield savings;
  • Free online bill pay;
  • ATM access;
  • Branch access;
  • Mobile access; and
  • Customer/member service.
Among its findings of the financial institutions that had all seven attributes:
  • In the Northeast, seven of the nine financial institutions were credit unions;
  • There was only one bank compared with 11 credit unions in the Mid-Atlantic;
  • In the Southeast, 17 credit unions were in the list of 20;
  • Credit unions outscored banks 8-1 in the Great Lakes list of nine;
  • In the Midwest, 14 of the 17 financial institutions were credit unions; and
  • Seventeen of the 19 financial institutions in the Pacific region were credit unions.
" NerdWallet 's Consumer Banking Index should serve as a reminder that not all financial institutions are equally suited to meet consumer needs," said NerdWallet Senior Analyst John Gower.
 
Regions were based roughly on the regulatory districts of the Federal Reserve and the National Credit Union Administration. Banks and credit unions may have crossed regions, and those with only an online presence or with a physical presence in at least half of all U.S. states were included in the national category.
 

Catalyst's CU CEO survey captures highest confidence in 6 years

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PLANO, Texas (5/22/14)--Faith in the economy appears to be mounting, at least in the eyes of credit union CEOs.

In Catalyst Corporate FCU's most recent confidence survey, CEO confidence in the economy reached its highest mark since the economic downturn in 2008.

The overall confidence index, tracked by the Plano, Texas-based corporate credit union, climbed three points in the first quarter, its second straight increase, up to 30.32 points.

The last time the index surpassed the 30-point mark was in 2007.

"Hopefully this latest enthusiasm won't be short-lived, and the recovery will begin to expand enough that member spending will strengthen, and credit unions will experience a more broad-based growth trend in loan demand at higher interest rates," said Brian Turner, Catalyst Strategic Services director and chief strategist.

Responses from CEOs to every question in the survey were more positive than the previous quarter, according to Catalyst, which hasn't occurred since late 2008.

The largest increase in confidence centered on the financial health of members. CEO confidence in present and future member financial health both rose by about 5.5 points.

For their own institutions, the survey recorded a 2.47-point increase in how confident CEOs are in current financial conditions, and a 0.95-point increase in future conditions.

CEOs also expect to see growth in both loan demand and share deposits over the next six months; the first time in three years CEOs have forecasted improvements in both areas.

The confidence survey was sent to more than 2,000 credit union CEOs throughout the country in April, with just more than 200 of the credit union leaders responding.

CO-OP launches campaign to 'empower, amplify' young generation

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RANCHO CUCAMONGA, Calif. (5/22/14)--CO-OP Financial Services has launched "Empowering People. Amplifying Dreams," a marketing program to promote credit unions membership to consumers born after 1980 featuring singer/songwriter Daria Musk as a spokesperson.

Musk has leveraged social media to launch her career in pop music. In 2011 she began to establish a market for her music by performing a live concert via Google+'s video chat feature, Hangouts. In fact, Wednesday night, she kicked off the program with a live concert from the House of Blues in New Orleans, the site of CO-OP's THINK 14 conference.

"Credit unions are the best option for consumers as a primary financial institution in wide variety of ways, including personalized service, convenient access to funds and great lending rates," said Stan Hollen, CO-OP president/CEO. "Yet studies show very low awareness of credit union benefits, especially among the young. CO-OP is a financial technology organization with nearly half of the more than 7,000 U.S. credit unions as clients. We are launching this initiative so that consumers can better understand how our industry empowers individuals to achieve their financial goals."

The campaign will make use of primarily digital content from both CO-OP and Musk to cross promote credit unions and her music. It will also follow Musk as she uses her credit union membership to establish herself financially.
 
A key component of CO-OP's initiative is a new website designed to tell consumers more about the advantages of credit union membership. 
 
The CO-OP campaign will also be supported by paid advertising and marketing; public and media relations and events; and promotion through Facebook, Twitter and other social networks.

Retirement, economic roadmaps featured at CUNA CFO Council

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LAS VEGAS (5/22/14)--Balance sheets, investments, fraud and the economy were just some of the topics covered at this week's CUNA CFO Council Conference in Las Vegas.
  • CUNA Mutual Group's Scott Knapp addressed how employers can engender a sense of security for their employees and 401(k) retirement plans.
     
    "Retirement security is contingent on the employer's decision to offer a well-designed retirement plan and employees' decision to participate, save enough and invest appropriately," said the director of retirement investment strategy.
     
    He offered seven steps of a "defined benefit-ization" program, which includes frequent assessments to ensure the plan provides a steady stream of income for retirees.
  • Over the next two years, there will be "more economic tailwinds and fewer headwinds," Credit Union National Association Senior Economist Steve Rick told a Tuesday audience.
     
    With U.S. economic growth forecast to reach 3% this year and 3.75% in 2015, credit unions can expect to see a surge in housing construction, rising home prices, higher auto sales, stronger business investment spending, and a robust energy sector, he said.
  • According to CPA Jennifer Hoskins, when auditors look for fraudulent activity, they have a road map they can follow.
     
    Hoskins, who is a partner at Nearman, Maynard, Vallez CPAs, shared the seven most common things that trip up an audit: Supervisory and file maintenance reports, dormant and no-mail accounts, annual disclosure statements, Statement on Standards for Attestation Engagements (SSAE) 16 reports, and reconciliations.
For coverage of the 2014 CUNA CFO Council Conference from Credit Union Magazine , use the resource link.

Superior service a special blend of skill, knowledge: Filene report

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MADISON, Wis. (5/22/14)--Credit unions must become familiar with the characteristics of the best account representatives and tellers to improve their organization's sales and service cultures, and shape their hiring, training and performance expectations around those attributes, according to a new white paper from the Filene Research Institute.
 
"Attributes and Skills of High-Performing Sales and Service Staff," written by credit union sales and service consultant Michael Neill, draws on a study of 4,667 credit union service representatives in which the top 20% of performers were identified with a minimum of eight shopping experiences.
 
"Credit unions will attract, retain, and improve superior member-facing employees only to the extent that they strengthen the several mechanisms they have for interacting with those employees," the report advises. The mechanisms include:
 
Hiring. Credit unions shouldn't simply hire "people persons," but look for look for employees who pick up on behavioral cues, ask good questions, and listen with ears attuned to finding solutions, the report advised. "What's important is what your employees do and the skills they exhibit when they are with members," the report said.
 
Training. Don't train employees on how to "do their job" with only operational behaviors, adding sales and service behaviors later. This requires employees to relearn their job, so to speak. Such relearning is like trying to learn a second language as an adult instead of learning it naturally, within the culture, over time. In such cases, employees will have a tendency to see sales and service behaviors as secondary to operational training; after all, the organization is signaling that sales and service behaviors are secondary due to their positioning in the training progression.
 
Coaching. Reading recipes for healthy foods and watching exercise videos won't make you lose weight, so don't assume that training alone will shape the right behaviors, the report said. Modeling good sales behavior, reinforcing good practices and critiquing bad ones are all essential to building the right sales and service culture.
 
Managing. The best sales and service employees have plenty of options, and they will leave managers who don't lead well. Include them in decision making, give them appropriate autonomy, and reward them not just for results but for the behaviors that lead to results, the report said. High performers in credit union selling are more likely to be turned on by how much they helped than achieving goals. Make sure management language reflects this desire.

To download the report, use the link.

CU System brief (05/21/2014)

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  • SEATAC, Wash. (5/21/14)-- In an interview with the Northwest Credit Union Association's Anthem newsletter, Numerica CU President/CEO Carla Altepeter said the decision to serve marijuana-related businesses was one that was slowly and carefully reviewed . "We're simply a financial institution that is serving an important need in our community," she said, adding, "We are very concerned about the possible crime associated with large-scale, cash-only businesses. " The $1.3 billion-asset credit union, based in Spokane Valley, Wash., announced earlier this month that it would serve businesses that grow or process pot ( News Now May 9) ...

CFO Council honors 6 CUs for providing high value to members

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LAS VEGAS (5/21/14)--During a Monday session of the 2014 CUNA CFO Council Conference in Las Vegas, six credit unions were honored for being top performers for their members.
 
"Today we recognized some credit unions for their uniquely credit union performance," said CUNA CFO Council Chairman David D'Annunzio. "We work solely for member service and benefit," added D'Annunzio, who is chief financial officer/vice president at $842 million-asset South Florida Educational FCU, Miami.
 
Based on an analysis of participating CFO Council Conference attendees' rates and fees, these credit unions received 2014 Member Benefits Top Performance awards for providing the greatest value to members:
  • Less than $450 million in assets: Department of the Interior FCU, Washington, D.C., with $146 million in assets; Memorial CU, Houston, with $74 million in assets; and NorthCountry FCU, Burlington, Vt., with $435 million in assets.
     
  • More than $450 million in assets: Neighbors FCU, Baton Rouge, La., with $632 million in assets; Scott CU, Edwardsville, Ill., with $928 million in assets; and Star One CU, Sunnydale, Calif., with $6.6 billion in assets.
For coverage of the 2014 CUNA CFO Council Conference from Credit Union Magazine , use the resource link.

Respect, positive experience draw millennials, CO-OP survey finds

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RANCHO CUCAMONGA, Calif. (5/21/14)--A recent study from CO-OP Financial Services delved into what millennials, or those born after 1980, look for in their financial institutions.

And what these young consumers desire, the study "Unlocking the Millennial Mystery" discovered, is more often found at credit unions.

"Both credit union members and bank customers are generally satisfied with financial institutions, (but) credit union members much more so," coordinators of the study reported.

Polling an even number of credit union members and bank customers, nearly 500 in all, the study uncovered that 81% of Gen Y members of credit unions said that their institution provides an "outstanding customer experience."

Only 59% of bank customers felt similarly.

Further, more than 95% of credit union members reported being very satisfied or at least somewhat satisfied with their financial institutions, compared with only 88% of customers of banks.

The survey also found that 38% of millennial credit union members would likely recommend their institution to others, compared with 16% of bank consumers. 

"Positive customer experiences (for millennials) are largely driven by the basics," the study said. "Deliver on expectations and treat people with respect. Positive staff attitudes are more strongly recognized on a local scale."

To better understand this demographic, CO-OP Financial Services initiated the study to accomplish several goals: to better define consumer expectations at financial institutions; contrast expectations with actual experiences; and identify what consumers want in a credit union brand.

The survey looked at services and products offered by credit unions with a special focus on millennials and their decision making in selecting a financial services provider. All respondents said that they had switched financial institutions in the past 12 months or were open to doing so.

Results were presented Tuesday to attendees of CO-OP Financial's THINK 14 conference in New Orleans.

$10M embezzlement suspected in Parsons Pittburg CU closing

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WICHITA, Kan. (5/21/14)--Gambling is suspected as a motive for the embezzlement of $10 million from Parsons Pittsburg CU, which was placed into conservatorship in January.
 
Court documents, filed with the U.S. District Court in Kansas, reveal that a January examination by the National Credit Union Administration found about $10 million in non-member deposits were missing ( The Kansas City Star May 20).
 
According to FBI statements in the court filings, the suspect and spouse spent more than $192,000--an amount that could not be attributed to their income--at casinos in Oklahoma and Missouri casinos between Jan. 20 and March 13.
 
An April search at the suspect's home uncovered two cashier's checks totaling $130,000, gold coins, silver coins, a Prada handbag, and documents showing the purchase of U.S. savings bonds, among other paperwork.
 
No criminal charges have been filed.
 
Parsons Pittsburg CU, with $13.4 million in assets, was a state-chartered, federally insured credit union. Golden Plains CU, Garden City, Kan., with $418.5 million in assets, assumed the Parsons, Kan.-based credit union's assets, members, loans and shares in March ( News Now March 23).

CU scholarships for higher ed total thousands

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MADISON, Wis. (5/21/14)--The school year is coming to a close, and students are determining which college they will attend this fall: trade, community, private or public. Regardless of where they go, hundreds of students will have the financial help of their credit unions and their generous scholarship programs.
  • Kayla Imani Vincent of Kings Fork High School, Suffolk, Va., received the $10,000 John Alan Glasgow Memorial Scholarship from Bronco FCU, a $182 million-asset credit union in Franklin, Va. Credit unions nationwide recognize their student members for their academic and extracurricular achievements with scholarships ranging from small to large--all of which help their young members achieve their academic dreams. (Bronco FCU photo)
    Winners of $5,000 scholarships from America's First FCU, Birmingham, Ala., with $1.29 billion in assets, were selected from the student of the week program, co-sponsored by ABC-TV 33/40 ( eSignal May 9).
  • More than $54,000 has been distributed by $185 million-asset Arsenal CU through its scholarship program. This year, three students received $4,200 from the Arnold, Mo., credit union ( Missouri Difference May 12).
     
  • A+ FCU, Austin, Texas, awarded $21,000 in scholarships to students, from those just beginning their college careers to those working on graduate studies. Each scholarship from the $1.06 billion-asset credit union was worth $1,000.
     
  • Philadelphia-based American Heritage FCU offered 21 scholarships worth $1,000 each to students, who also had to submit essays about their educational and financial goals and how the $1.3 billion-asset credit union could help achieve them.
     
  • Six members of the VIBZ youth program at $984 million-asset Black Hills FCU, Rapid City, S.D., each received a $1,000 scholarship.
     
  • Bronco FCU, Franklin, Va., with $182 million in assets, distributed $20,000 in scholarships ranging from $500 to $10,000.
     
  • The Central Massachusetts Chapter of the Massachusetts Credit Union League presented $4,500 worth of scholarships during its recent annual meeting ( Daily CU Scan May 19).
     
  • CMC-FCPI Employees FCU, Scranton, Pa., with $5.9 million in assets, awarded three Paul Bordi Memorial Scholarships to three students who wrote about how sports made them a better person.
     
  • A $100,000 commitment to end Michigan's "brain drain" is the cornerstone behind $513 million-asset Community Choice CU's scholarship program. The Farmington Hills-based credit union awarded $5,000 to 20 high school seniors from the metro Detroit area for pledging to attend college in Michigan and committing to giving back to the state by building their careers in-state.
     
  • Community Financial CU, Springfield, Mo., with $57 million in assets awarded the Linzee W. Leonard Scholarships, worth $1,000 each, to two Springfield, Mo., high school seniors ( Missouri Difference May 8).
     
  • Del Norte CU, Los Alamos, N.M., with $463 million in assets, announced the seven winners of its scholarship program, which provides $1,000 for students' academic studies for fall 2014.
     
  • Birmingham, Ala.-based eCO CU, with $119 million in assets, awarded two high school seniors with $1,000 scholarships that are given in honor of the late Rev. A.L. Bratcher, who founded the Canaan Baptist Church FCU, Bessemer, Ala. ( eSignal May 9).
     
  • Multi-year scholarships were awarded by $471 million-asset First Community CU. The Bismarck, N.D.-based credit union awarded a four-year $1,000 scholarship, a two-year $1,000 scholarship and two one-year $1,000 scholarships ( Bismarck Tribune May 18).
     
  • Fort Campbell FCU, Clarksville, Tenn., with $455 million in assets, distributed six $2,000 scholarships. Its essay question asked for two ideas on ways to promote financial services to applicants' generation.
     
  • With $149 million in assets, Fort Lee FCU, Prince George, Va., announced the winners of its four scholarships--worth between $500 and $1,000--during its annual meeting.
     
  • At its 60th annual meeting, Hanscom FCU, Hanscom Air Force Base, Mass., awarded $12,000 in scholarships to six young members. "Hanscom FCU makes a lot of investments every year, and I'll put these eight up there with any of them," said Paul Marotta, board chair of the $1.07 billion-asset credit union ( Daily CU Scan May 16).
     
  • OSU FCU, Corvallis, Ore., granted $1,000 "Tomorrow's Leaders Today" scholarships to 15 high school seniors who are members of the $830 million-asset credit union.
     
  • The Shenango Valley Chapter of the Pennsylvania Credit Union Association held its 14th annual scholarship dinner where it awarded 20 scholarships worth $500 each ( Life is a Highway May 15).
     
  • SIU CU, a $278 million-asset credit union in Carbondale, Ill., distributed $1,000 scholarships to five local students for the upcoming academic year.
     
  • United San Antonio Community FCU, Austin, Texas, with $221 million in assets, awarded $1,000 scholarships to four high school seniors.
     
  • The University of Kentucky FCU, Lexington, donates $15,000 in scholarship funds each year--$5,000 to each of the three main schools it serves: University of Kentucky; Eastern Kentucky University, Richmond; and the Kentucky Community and Technical College System, Versailles. The three students who are attending the Kentucky Community and Technical College System at enrolled in the North American Racing Academy to become jockeys.
     
  • Western Cooperative CU, Williston, N.D., with $318 million in assets, distributed "CU Succeed" scholarships, each worth $500, to six young members of the Class of 2014.
 

'Labor of love,' Rep. Larson tells Conn. GAC of CU support

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MERIDEN, Conn. (5/21/14)--The Credit Union League of Connecticut's State and Federal Issues Governmental Affairs Conference attracted some big names to its annual event last week, including Gov. Dannel P. Malloy and Rep. John Larson (D-Conn.).

Gov. Dannel P. Malloy. left, meets with Credit Union League of Connecticut President/CEO Jill Nowacki during the league's Governmental Affairs Conference. (Credit Union League of Connecticut photo)
Nearly 100 credit union professionals attended the event.

In addition to Malloy, Rep. John Larson (D-Conn.) was on hand to share his positive feelings about credit unions, calling his support a "labor of love" due to the important role credit unions play in assisting the middle class.

"When no one else heard the story of the working person, you did," Larson said. "That is why members of Congress overwhelmingly support credit unions' tax-exempt status."

Malloy, meanwhile, has supported credit unions broadly as well, specifically backing sales and use tax exemptions at the state level. The state's governor spoke of the unique value of the member-owned institutions.

Banks are not in the business of forging appropriate savings habits, especially with young people, like credit unions are, he said.

Malloy also revealed that every member of his family financed their education through a local credit union, and said he believed credit unions will help people throughout the state develop savings habits that will one day allow them to pay for college tuition.

Also speaking was Ryan Donovan, Credit Union National Association senior vice president of legislative affairs, who trumpeted the success of Connecticut credit unions of late.

Among other efforts, credit unions in Connecticut have locked down a sales tax exemption for state-chartered credit unions, and received the unanimous support from Connecticut's representatives in the U.S. House for a letter detailing concerns with the National Credit Union Administration's proposal on risk-based capital.

Five advisers selected for CUNA's Experience Learning Live! program

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MADISON, Wis. (5/21/14)--The five credit union professionals who will serve on the Credit Union National Association's Experience Learning Live! Advisory Committee were revealed this week.

Selected from a list of applicants, the committee will spearhead CUNA's credit union learning and development program at this year's conference, scheduled for Oct. 26-29 in San Antonio.

The event will feature updates on the latest training trends, provide insight and advice from leading experts in employee engagement, and offer access to top educational development tools.

The 2014 advisory committee members are:
  • Sarah Best, learning and development specialist, Summit CU, Madison, Wis., with $1.9 billion in assets;
     
  • Diane Faris, functional trainer, Sun FCU, Maumee, Ohio, with $441 million in assets;
     
  • Ashley Frost, training assistant, GCS CU, Granite City, Ill., with $315 million in assets;
     
  • Amy Ivey, assistant vice president of marketing and development, Bay FCU, Capitola, Calif., with $687 million in assets; and
     
  • Rieanne King, training specialist, Trona Valley Community FCU, Green River, Wyo., with $159 million in assets.
The committee is charged with producing timely and relevant session topics by using feedback, networking and community awareness.

Advisory members--who will host events, introduce speakers and contribute to the overall onsite experience later this year--will serve until the end of the conference.

Financial worries challenge nation's servicemembers

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WASHINGTON (5/20/14)--A large majority of U.S. military service personnel worry about their income and job security, according to a National Foundation for Credit Counseling (NFCC) survey, which was administered in recognition of Military Appreciation Month.

More than 75% of the servicemembers polled worry about their finances, while 57% said they're very concerned that defense cuts and downsizing may jeopardize their salaries and jobs.

Conducted last month, the NFCC polled 267 adults ages 18 and older who are currently enlisted members of the U.S. military.

"Unfortunately, the survey findings indicate ongoing financial concerns for many military families," said Joe Freeman, CEO of Pioneer Services, the division of MidCountry Bank that sponsored the survey.

The survey also found that 28% of service people are more concerned than they were a year ago about how their financial situations will affect their future in the military. Additionally, 55% reported feeling unprepared for a financial emergency.

Further, three out of five servicemembers who took out loans over the last year said that limited lending options forced them to look for alternative, non-traditional lenders to meet their financial needs.

"It is incumbent upon all of us to ensure that military families have access to the same credit options many civilians take for granted, and to financial education resources that help empower them to make the right decisions," Freeman said.

The military survey was also compared with a similar NFCC poll posed to the general public. The comparison found that 25% more servicemembers carry over credit card debt month-to-month than those from the general public.

The comparison also revealed that twice as many military personnel applied for new credit cards in the last 12 months than civilians. 

Additional findings:
  • Nearly half of servicemembers have taken out a loan in the past 12 months;
     
  • Twice as many servicemembers have paid less than the minimum required payment on debt than those from the general public over the last year; and
     
  • Servicemembers were more than twice as likely to search out a cash advance on a credit card as civilians.

Youth tuck away more than $20.5M during saving challenge

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MADISON, Wis. (5/20/14)--Young members deposited $20.5 million into their credit union accounts during this year's National Youth Saving Challenge, sponsored by the Credit Union National Association.
 
Two young members--Jeremy and McKenzie--of Spokane (Wash.) FCU, with $127 million in assets, were rewarded for their guessing prowess for how much money was in the savings jar during National Credit Union Youth Week.  (Spokane FCU photo)
The 238 participating credit unions reported 94,466 young people deposited an average of $217 each, with 8,844 new accounts.
 
In 2009, the challenge expanded to the entire month from National Credit Union Youth Week because credit unions said one week wasn't long enough. Seventy percent of this year's credit unions ran the challenge for the full month.
 
In 2004--its first year--the weeklong challenge had 143 participating credit unions, with nearly $1.4 million deposited by young members.
 
This year's challenge also included incentives provided by GreenPath Debt Solutions. The credit counseling organization provided sponsorship funds that increased the number of youth cash prizes to 25, up from 10 in previous years.
 
"Knowing our support helped increase the number of winners is fulfilling," said GreenPath CEO Jane McNamara. "We hope this will serve as an incentive for young savers to use the good saving practices they learned during the National Youth Saving Challenge."
 
Last week, CUNA awarded $100 in cash to kids from 25 randomly selected credit unions. Use the resource link to see the winners' names.
 
In addition, from Jan. 23 through April 2, CUNA awarded a prize every two weeks to a credit union that had signed up for the Youth Saving Challenge. Prizes included one-year subscriptions to two of CUNA's personal finance microsites, 100 copies of "Guide to Money" and other handbooks, a Seminars in a Box for Members kit, and a Mad City Money kit. The seven credit union winners were:
  • Central Missouri Community CU, Warrensburg, Mo., with $98 million in assets;
  • St. Joseph FCU, Canton, Ohio, with $43 million in assets;
  • TruNorth FCU, Ishpeming, Mich., with $121 million in assets;
  • Manistique (Mich.) FCU, with  $22 million in assets;
  • Via CU, Marion, Ind., with $298 million in assets;
  • Kearney (Neb.) FCU, with $34 million in assets; and
  • Rockford Postal ECU, Loves Park, Ill., with $16 million in assets.

Tenn. league, VolCorp add 3 to Hall of Fame

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NASHVILLE, Tenn. (5/20/14)--The Tennessee Credit Union League (TCUL) and Volunteer Corporate CU  jointly inducted three individuals into the Tennessee Credit Union Hall of Fame during the league's annual convention and expo in Chattanooga, Tenn. 
 
The 2014 inductees are:
  • Sara Broxterman, retired president/CEO, $103 million-asset Kimberly Clark CU, Memphis;
  • R. Bruce Runyan, director, $1.6 billion-asset Ascend FCU, Tullahoma; and
  • Jimmie Bearden, former president/CEO, Ascend FCU (posthumously inducted).
Broxterman began at Navy Memphis CU in 1960 working as a clerk making $0.50 per hour.  She retired in 2004 as president/CEO of Kimberly Clark CU in Memphis.  During her 23 years at Kimberly Clark CU, assets grew to $73 million from $11 million. 
 
Through regular attendance at board meetings and numerous committee meetings in 34 years as a volunteer, Runyan's service has been vitally important to the purpose, mission, and vision of a credit union that serves more than 144,000 members from 16 locations. 
 
For 36 years, Bearden guided the growth and expansion of AEDC FCU, now Ascend FCU, as CEO. Her credit union career spanned almost 50 years. As CEO, Bearden implemented checking accounts, offered mortgage loans, individual retirement accounts and ATMs, and opened branches on Saturdays.  All of these services, which are now considered standard offerings in many credit unions, were pivotal in the credit union's growth.

Card fraud scares citizens most, security index finds

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BLUE PELL, Pa. (5/20/14)--More than any other type of security threat, U.S. citizens worry most about credit and debit card fraud, according to the 2014 Unisys Security Index, released last week in partnership with Lieberman Research Group.

Likely driven by the recent spate of data security breaches across the country, 59% of respondents reported being "extremely" or "very" concerned about someone stealing and using their credit or debit cards, a 7% jump from last year's poll.

Identity theft and national security ranked second and third--at 57% and 47% respectively--on the list of top security concerns. The index is based on a survey of 1,005 U.S. citizens.

"In today's hyper-connected world, people are wary of losing their financial and personal data to cybercrime, and it is crucial that businesses review and enhance their security measures on a continuous basis," said Dave Frymier, Unisys chief information security officer.

The Credit Union National Association continues to prod federal lawmakers to develop legislation that would force merchants to abide by the same data security standards as credit unions and other financial institutions. As it stands, CUNA leaders say, merchants are not required to shoulder enough of that responsibility.

The index also found that nearly 60% of those polled would be less likely to do business with a commonly used financial institution or store if a security breach involving their personal or credit card data occurred there.

Almost 40% said, however, they would not likely change how they shopped or did business in response to a breach. 

Legislature hears Mich. league testimony on electronic lien titling

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LANSING, Mich. (5/20/14)--The Michigan Credit Union League testified before two Senate committees on legislation that would assist credit unions with making recordkeeping more efficient.
 
The Senate Transportation Committee heard from the league and Credit Union ONE, Ferndale, with $821 million in assets, regarding electronic lien titling and lien transactions ( Monitor May 19). Michigan is one of a small number of states in which titles are still mailed to the owner instead of the lienholder.
 
The paper-based title-holding system can enable "title washing," a type of fraud that hides the history of a vehicle, including whether it was salvaged or written off as a loss. SB 915, 916, 917 and 918 would move the state toward full electronic and centralized titling and holding of titles, along with placement and release of security interests.
 
The centralized and electronic system would offer improved technology to allow for quick and secure electronic title checks for member institutions and help minimize title fraud for consumers, Monitor noted.
 
Last week, league-supported legislation was passed by the Senate Banking and Financial Institutions Committee. HB 4638, 4639 and 4640 would allow a copy of an original instrument that is verified by an affidavit and recorded to be deemed in compliance with property recording.
 
The bills would protect lenders in the case of lost documents by allowing the creation, verification and recording of copies of the mortgage and property deeds on record. Under this legislation, verified mortgage document copies would be recorded within the meaning of the Michigan recording statutes, giving protection to the lender's position as a secured creditor.
 
It also creates a clearer chain of title on certain parcels of property and removes potential questions about electronic recording, which has the potential to save credit unions and recording offices time and money.

Mixed emotions for Tinker FCU one year after the storm

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OKLAHOMA CITY (5/20/14)--One year ago today a half-mile-wide tornado destroyed Tinker FCU's (TFCU) branch in Moore, Okla. While the EF5 tornado devastated much of the Moore area, killing 24 people and injuring 377 others, it somehow spared 23 employees and members who took shelter in the branch's vault.
 
Click to view larger image The Moore, Okla., branch of Tinker FCU was the first business in Moore that was destroyed in May 20, 1013 tornado to reopen. The new branch opened its doors Jan. 27. Today is the first anniversary of the tornado.
Today, on the anniversary of the storm, employees of the credit union are back at the newly rebuilt Moore branch, serving the community after an emotion-filled year that tested the resiliency of the entire Moore community. The TFCU Moore branch reopened its doors on Jan. 27--eight months after the storm.
 
The anniversary has stirred up a mix of emotions for Moore branch employees, said Matt Stratton, vice president of marketing for the $1.6 billion-asset Oklahoma City-based credit union. "It's somber and reflective, because there was loss of life around the city of Moore, but we're also excited to be open again," Stratton told News Now . "Of the businesses in town that were completely destroyed, we were the first to re-open. We like being part of recovery. Moore is tough town. Oklahoma is a tough state."
 
On the day of the tornado, TFCU employees monitored the approaching storms and followed the established protocol for severe weather, taking shelter in the safe deposit box vault. All 14 employees, eight TFCU members and one passer-by rode out the storm and walked away from the destruction without injury.
 
"I am so grateful for the people at the Moore branch and the friendships we have made from that day," said TFCU member Dena Clark, who took shelter in the vault during the storm. "Yes, it happened and it's part of my family's story now. My husband and I just celebrated our first year of marriage and buying our first house--none of that would have happened without TFCU and how the people there saved my life."
 
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 ( News Now May 22, 2013).
 
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 EF5-scale tornado that hit the area near Oklahoma City. Fourteen staffers and eight members were inside the vault and escaped with no injuries. (Photos provided by Tinker FCU)
Immediately following the storm, TFCU employees worked to communicate to members about the destruction of the branch, the safety of everyone inside and that all of their information was secure. TFCU leadership met to begin the plan of recovery.
 
"We began a conversation with our community almost immediately through social media, and the outpouring of support was inspiring," said Stratton. "There was never any doubt that we would rebuild and be a part of Moore's recovery, and we are so thankful for all of the support and encouragement we received from everyone who helped out along the way, beginning only moments after the tornado passed right through to opening day of the new branch."
 
While the new branch was being built, Moore branch employees were assigned to other locations within TFCU's branch network. "We gathered all the branch employees together right after the tornado to decompress, if you will, and let them know we would have a job for everyone that was the best fit for what they were doing that was as close to their homes as possible," Stratton told News Now.
 
The safe deposit box vault was the only remaining, intact structure of the branch. The vault walls were constructed of 5-inch-thick concrete panels with steel rods that penetrate through the foundation to securely affix the vault to its location in the building.
 
TFCU memorialized the strength of the vault and the events of May 20, 2013, with the installation of a monument made from a recovered section of the vault where people took shelter during the storm. The monument, located outside of the rebuilt branch, displays the original building dedication plaque and an etched inscription to pay tribute to the lives saved and the spirit of Oklahomans in times of need.

CU System briefs (05/20/2014)

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  • RIEGELWOOD, N.C. (5/20/14)-- Logan Connor may be the first member of Riegelwood (N.C.) FCU's just-launched "Buck Buddy" kids' club , but he is a long-established saver at the $96 million-asset credit union's Acme Delco Elementary School branch in Ransom, N.C. The third-grader makes weekly deposits at the in-school branch and said, "I love the credit union because I can save my money there, and no one can steal it." The wise 8-year-old, who has had an account since 2008, also offered this advice: "Put needs before wants" (Riegelwood FCU photo) ...
     
  • WASHINGTON (5/20/14)-- Navy FCU, with $55.5 billion in assets, is expanding its global reach by opening 60 new branches by 2016 , primarily in its areas of growth near Washington, D.C.; Tidewater, Va.; Jacksonville, Fla.; and San Diego, according to The Washington Post (May 18). The Vienna, Va.-based credit union--which serves U.S. military personnel and their families, as well as Defense Department employees--is the world's largest and already has nearly 230 branches ...
     
  • WATERLOO, IOWA (5/20/14)- -Members at Ashworth CU, with $6.7 million in assets, voted in favor of a merger with Waterloo, Iowa-based Veridian CU, with $2.4 billion in assets ( Cedar Valley Business May 17). The single employee group credit union serves a membership of 900 employees at GuideOne Mutual Insurance in its West Des Moines, Iowa. Its two employees will be moved to jobs within Veridian CU. The Iowa Division of Credit Unions and the National Credit Union Administration also approved the merger, expected to be effective June 29 ...

CU System briefs (05/19/2014)

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  • MARLBOROUGH, Mass. (5/19/14)-- The Massachusetts Coalition for the Homeless honored its longtime partner, the Massachusetts Credit Union League, for its support during Thursday's annual fundraising gala ( Daily CU Scan May 16). The evening's theme was "sweet dreams" because proceeds will fund the coalition's "A Bed for Every Child" program. Coalition advocates found that children in low-income households were falling asleep in school because they didn't have a bed of their own at home to sleep in. Every $250 raised buys a mattress, box springs, frame and bedding for a child. As part of its general appeal campaign, the league's Community Hope Initiative will be dedicated to "A Bed for Every Child" ...
  • OMAHA, Neb. (5/19/14)-- Omaha's Children's Hospital and Medical Center is the latest recipient of box sets of the "Biz Kid$" TV show, thanks to Nebraska credit unions . The Old West Chapter of Credit Unions; the Nebraska Credit Union League; $78 million-asset People's Choice FCU, Lincoln; and $61 million-asset Omaha Police FCU ( The Affiliate May 16). The donation is part of the National Credit Union Foundation and Credit Unions for Kids campaign to get copies of the financial education TV show into every Children's Miracle Network Hospital during the month of April, which was National Financial Literacy Month ...
  • DAYTON, Ohio (5/19/14)-- Heartland FCU, Dayton, Ohio, named Ronald Huist as president/CEO . He previously was executive vice president at the $78-million asset credit union and has spent 23 years as a member of the board ( Dayton Business Journal May 15). Huist has a bachelor's degree in accounting from Wright State University, Dayton, and a master's of business administration from the University of Dayton ...

The envelope please: CUNA's Blockbuster Awards announced

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WASHINGTON (5/19/14)--"People helping people" and credit union cooperative philosophies were common themes among this year's winners of the Credit Union National Association's Blockbuster Awards.
 
The Virginia Credit Union League's "Quit the Hit" campaign, featuring the softer side of George Washington, won best of show in the Credit Union National Association's Blockbuster Awards.
The awards highlight state credit union leagues' work in marketing, advertising and publications.
 
The Virginia Credit Union League's (VCUL) "Quit the Hit" campaign was honored in best of show and best use of social media, which included a video of a surly George Washington. The Northwest Credit Union Association (NWCUA) picked up five awards.
 
The winners are:
  • Best ad on behalf of league or league service corporation: Credit Union Association of New Mexico, "Claim Your Youth" conference book;
     
  • Best campaign on behalf of league service corporation: Missouri Credit Union Association, "Bank on More;"
     
  • Best credit union campaign (tie): Pennsylvania CU Association, "iBelong," and NWCUA, "Say No to Big Banks;"
     
  • Best logo design: NWCUA, Amplify;
     
  • Blow your own horn: League of Southeastern Credit Unions (LSCU), "LSCU from the Governmental Affairs Conference" videos;
     
  • Best community relations program: Credit Union Association of Dakotas (CUAD), CU Social Good;
     
  • Best league publication, magazine: California and Nevada Credit Union Leagues, CU Digest ;
     
  • Best league publication, newsletter: NWCUA, Anthem ;
     
  • Best league piece on the uniqueness of credit unions: Nebraska Credit Union League, "Credit Union Awareness" insert;
     
  • Best public relations project: NWCUA, "Truth Speaks" SOS (Save Our Tax Status--Oregon);
     
  • Best league annual report: Pennsylvania Credit Union Association, 2012 annual report;
     
  • Best website: NWCUA, Truth Speaks;
     
  • Best online publication: CUAD, The Memo ;
     
  • Best use of social media: VCUL, "Quit the Hit;" and
     
  • Best of show: VCUL, "Quit the Hit."
 
Winners will be honored at CUNA's GAPS/Communicators Conference June 16 in Washington, D.C.

CU Magazine seeks movement's rock stars

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MADISON, Wis. (5/19/14)--Nominations are now open for this year's Credit Union Magazine's Credit Union Rock Stars--individuals who demonstrate outstanding innovation and creativity in their chosen fields for the betterment of the credit union movement.
 
Nominations are due July 7.
 
"Last year, we honored nearly 50 outstanding individuals as Credit Union Rock Stars--and we know there are many more out there," said Ann Hayes Peterson, Credit Union Magazine's acting editor-in-chief. "We look forward to the 2014 round of nominations, showcasing the inspiring people who have not only furthered the credit union mission, but made it their own."
 
Credit Union Rock Stars are individuals with the passion and drive to put bright ideas into action and champion the credit union ideal of "people helping people." Their contributions range from teaching weeklong money camps and developing a new conference to forming a credit union-themed band and becoming a superhero to fight off predatory lenders.
 
Among last year's Credit Union Rock Stars was Laura Aguirre, president/CEO of $32 million-asset Hawaii First FCU, Kamuela, Hawaii. She helped her credit union earn its low-income designation and Native Community Development Financial Institution certification. The credit union serves the community with free access to job-seeking assistance, credit and debt management, one-on-one financial counseling and financial education workshops.

Rock stars are selected for their dedication and accomplishments in the following pursuits:
  • Raising the bar on creativity, strategy and execution;
  • Taking a unique approach their work; and
  • Possessing the admirable qualities of a role model.
This year's Credit Union Rock Stars will be showcased in a bonus issue of Credit Union Magazine and online.
 
Use the resource link for the nomination form.

Three generations, three views of retirement

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LOS ANGELES (5/19/14)--When credit unions help their members with retirement planning, they must be ready for vastly disparate expectations based on their members' differences, according to research from Transamerica Center for Retirement Studies (TCRS).
 
The 15th annual Transamerica Retirement Survey, one of the largest and longest-running national surveys of its kind, examines current trends among American workers and compares the retirement outlooks of baby boomers, Generation X and millennials.
 
Baby boomers (born between 1946 and 1964) are proving that working in retirement and taking time for leisure are not mutually exclusive. Many baby boomers were already mid-career when the retirement landscape shifted from defined benefit plans to 401(k) or similar plans. They have not had a full 40-year time horizon to save in 401(k)s and experience the full effects of long-term compounding of their investments.
 
"Many baby boomers were hit hard during the Great Recession and, unlike younger generations, they have less time to financially recover before they retire," said Catherine Collinson, TCRS president.
 
TCRS found baby boomers to have total household retirement savings of $127,000 (estimated median), an increase from $75,000 in 2007, however, not enough to meet retirement needs for many.
 
This savings shortfall helps to explain the sharp increase in baby boomers who expect to rely on Social Security as their primary form of income when they retire--now 36%, up from 26% in 2007.
 
Sixty-five percent of baby boomers plan to work past age 65 or do not plan to retire. Fifty-two percent expect to continue working, with 42% working on part-time basis when they do retire. Only 21% plan to immediately stop working when they retire. Most of those who plan to continue working say it's for income or health benefits.
 
Generation X (born between 1965 and 1978) entered the workforce in the mid- to late 1980s just as 401(k)s were being implemented and defined-benefit plans were beginning to disappear. It is the first generation to have access to 401(k)s for most of its working careers.
 
"Generation X is the 401(k) generation," said Collinson. The survey found that among Generation Xers:
  • More than half (52%) expect to self-fund their retirement with 401(k)s, 403(b)s or IRAs;
  • Ninety-one percent highly value 401(k) or similar plans as an important benefit; and
  • Among those offered a plan, 84% participate in the plan, and participants contribute 7% (median) of their annual salary.
Millennials (born after 1978) have lofty aspirations about their future retirement. The majority (60%) plans to retire either before or at age 65. Most plan to continue working when they retire; many simply for enjoyment.
 
"Millennials are a digital do-it-yourself generation of super savers," said Collinson.  "They've heard and responded to the message they need to start early and save as much as possible." The survey found that 70% of millennials are already saving for retirement and started at median age of 22.
 
Two of three (66%) Millennials expect to self-fund their retirement through retirement accounts--401(k)s, 403(b)s and IRAs--or other types of savings and investments. Among millennials who are offered a 401(k) or similar plan, 71% are participating and contribute a median of 8% of their annual salary. Even more impressive, among millennials currently participating in their plan whose employer offers a matching contribution to the plan, the salary contribution rate increases to a median of 10%.

Tension in a tinderbox: CUs brace for fire season

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SAN DIEGO (5/19/14)--Some credit unions in Southern California are virtually surrounded by wildfires, but as of Friday afternoon they have escaped damage, according to reports.
 
Several credit union branches were closed late last week due to air conditions or their proximity to evacuation areas.
 
Sony San Diego Employees FCU, with $7 million in assets, closed for "a couple of hours" because its sponsor, Sony Electronics, issued a voluntary evacuation notice, Sandra Crane, the credit union's president/CEO, told News Now .
 
"They wanted us to reach our homes, evacuate if necessary, and also the air quality was poor, so there were multiple things going on," Crane said.
 
Crane lives within a mile of one of several fires in the area.
 
"It is pretty nerve-wracking," Crane said. "Fortunately, here at the credit union we have an excellent disaster recovery policy in place. We are completely mobile and can access information from anywhere and work from anywhere. It's also nice that we are on-site at Sony Electronics. We have a great group of people taking care of us."
 
California Coast CU, San Diego, with $1.7 billion in assets, closed two branches Thursday, but the locations were re-opened Friday.
 
"The situation is very fluid," Marjorie Rice, California Coast CU communications and community relations manager, told News Now . "The weather changes rapidly, and we adjust accordingly. Not only do have to think about our members coming into the branch, but our staff as well."
 
Other credit unions reporting branch closings to the California and Nevada Credit Union Leagues were $206 million-asset Cabrillo CU, San Diego; Point Loma CU, San Diego, with $436 million in assets, and Pacific Marine CU.
 
"We are monitoring the situation and stand ready to assist credit unions that may become affected by the fires," Tena Lozano, California and Nevada Credit Union Leagues consumer advocacy manager, told News Now . "Thankfully, we're not aware of any damage to credit unions or their employees at this time."
 
Pacific Marine CU closed one branch in San Marcos, Calif., due to air quality and its proximity to an evacuation area, Brad Smith, vice president of strategic development, told News Now . The branch re-opened Friday.
 
The $685 million-asset credit union also closed a branch at Marine Corps Base Camp Pendleton last Wednesday. The branch re-opened Thursday.
 
Pacific Marine CU's corporate headquarters in Oceanside is located within a few miles of several fires, Smith said. "We're virtually surrounded in this area," he said. "There's been something like nine fires in San Diego County.

"There's smoke everywhere, and it changes direction depending on the wind," he said, adding, "I'm looking out my office at a huge plume of smoke from a fire at Camp Pendleton that has burned more than 8,000 acres."
 
Smith said the situation has made employees nervous, especially when freeways are closed, making commuting uncertain. "All the schools are closed as well," Smith said. "Some employees went home to take care of their families. There's a lot going on here."
 
At the same time, he said employees have taken time to distribute supplies, such as Gatorade and personal hygiene products, at local evacuation centers. "It's not that the Red Cross couldn't handle it, but I think it helps people to connect emotionally, to reach out to others during a time like this," Smith said.
 
The entire state of California has been declared in a state of severe drought or worse, according to the U.S. Drought Monitor. While it is waiting for needed water, other parts of the country are preparing for an onslaught of it as the June 1 hurricane season nears.

Minn. judge wants quick movement on Target breach cases

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ST. PAUL, Minn. (5/19/14)--Last week, U.S. District Judge Paul Magnuson set the stage for the next steps for the multitude of class action lawsuits filed against Target Corp. for its 2013 data security breach.
 
"I know Target would like to have big, long, indefinite stays," Magnuson said at Wednesday's case management meeting ( St. Paul Pioneer Press May 15). "I don't think it's appropriate."
 
In April, the U.S. Judicial Panel on Multidistrict Litigation determined that the class action lawsuits would be consolidated in the District of Minnesota. Magnuson and U.S. Magistrate Judge Jeffrey Keyes first grouped the cases into three categories:
  • Consumer lawsuits. With 111, this is the largest group and represents those whose information was compromised.
     
  • Financial insitutions. Twenty-nine cases are from financial institutions that had to cover costs of reissuing cards and reimbursing consumers. Four credit unions are among the plaintiffs: Alabama State Employees CU, Montgomery, Ala., with $211 million in assets; First Choice FCU, New Castle, Pa., with $38 million in assets; Employees CU, Dallas, with $63 million in assets; and KC Police CU, Kansas City, Mo., with $107 million in assets.
     
  • Shareholders. Four cases have been filed on behalf of shareholders.
The retail giant revealed Dec. 19 that about 40 million debit and credit card numbers were compromised as was the personal information of as many as 70 million customers. Much of the stolen information was sold online to other criminals.
 
"I'm beginning to learn this data breach business is quite a cottage industry," Magnuson said in the Pioneer Press .
 
A survey by the Credit Union National Association found that credit unions incurred $30.6 million in costs directly related to the breach--not including fraud costs. CUNA is pressing federal lawmakers to address data security relative to merchants, who are not held to the same standards of security as credit unions and other financial institutions.
 

CU System briefs (05/16/2014)

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  • WASHINGTON (5/16/14)-- Alex McVeigh is the new communications specialist at the Credit Union National Association and will be serving primarily as the Washington reporter for  News Now . He will primarily write stories involving legislation, regulation and policy events that are of interest to credit unions. He comes to CUNA after six years working in newspapers as a reporter and online publications as an editor.  McVeigh has broad experience, having covered everything from politics and government to business and feature stories during four years in local journalism. He has also covered the military in the Washington, D.C., area. McVeigh graduated from Virginia Polytechnic and State University--popularly known as Virginia Tech--with a bachelor's of arts degree. McVeigh joined the News Now team on May 5. He is based in CUNA's Washington office and can be reached at amcveigh@cuna.coop ...
  • Kendra Baker, right, United Northwest FCU, picks up the tab for diners at Town and Country Kitchen in Norton, Kan., as part of the Kansas "the CU way" campaign Thursday. (Kansas Credit Union Association photo)
    WICHITA, Kan. (5/16/14)-- On Thursday, Kansas credit unions gave away $10,000 as part of this round of the Kansas Credit Union Association's (KCUA) Make a Difference campaign . During "the CU way" events Tuesday and Thursday, 16 credit unions in 11 Kansas communities either paid for meals or offered gift cards to cover diners' meals. (See News Now May 14:CUs make Kansans' day 'the CU way.') "Not only were credit unions surprising the people who live in their community, they were also supporting local businesses," said Susan Dyer, KCUA director of communications. To date, Kansas credit unions have given away $55,500 to consumers through the Make a Difference campaign, including two gas giveaways and a similar "It's On Us" event ...
  • DAVENPORT, Iowa (5/16/14)-- To help Prophetstown, Ill., rebuild its downtown, IH Mississippi Valley CU, with $868 million in assets, is planning to build a branch there this summer. "We've been serving the Prophetstown community for more than 10 years," said Dennis Hall, president of the Moline., Ill.,-based credit union ( Quad-City Times May 14). "When we learned of the devastating fire on Main Street, we were committed to helping the recovery efforts." A groundbreaking ceremony will be held July 15 in conjunction with a memorial to commemorate the first anniversary of the fire that destroyed eight buildings, damaged two others and left more than a half-dozen people homeless ...

LSCU's 'Better name for banking' adds muscle to social media

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BIRMINGHAM, Ala., and TALLAHASSEE, Fla. (5/16/14)--The League of Southeastern Credit Unions will regenerate its "Credit unions, we're giving banking a better name" image awareness campaign in Florida and Alabama later this month with an enhanced social media push.  
 

The LSCU & Affiliates Cooperative Image Campaign will kick off May 26 and run for eight to 10 weeks in the 14 media markets in both states.
 
The campaign will steer consumers to the www.betternameforbanking website, where they can learn about the benefits of credit union membership. Traditional TV and radio ads will run, along with billboards in some markets, the league said. Many markets will see traffic sponsorships on TV and radio.
 
In addition to traditional online behavioral targeting and YouTube promotions, the online buy will also employ Pandora, search engine marketing, Facebook, mobile targeting, domain email marketing, Twitter, and video pre-rolls. All of the content can be shared by credit unions that participate in the campaign.
 
The league said 115 credit unions are participating in the $1 million media buy.

Boston Marathon's fast fleet of CU feet fetches $180K

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BURLINGTON, Mass. (5/16/14)--Fleet of feet. Strong of heart. Deep of generosity. The 16 racers who participated in this year's Boston Marathon as part of the Credit Unions Kids at Heart (CU K@H) program raised more than $180,000--the most in the team's history--for the Boston Children's Hospital.
 
Click to view larger image With 16 racers and a wealth of supporters, Credit Unions Kids at Heart raised more than $180,000 for Boston Children's Hospital at this year's Boston Marathon.
The CU K@H marathon runners are each paired with a patient-partner child who is receiving care at the hospital. The relationships are inspiring--the children motivate the runners as they train through the winter, and the runners build bonds with the children.
 
"It is a commitment to training, fundraising and building relationships," said Alan Bernstein, Credit Unions Kids at Heart spokesman and president of Vertifi Software.
 
In addition to raising funds on their own, runners are sponsored by a credit union, or the CU K@H program. This year, the team had six rookie runners, including Carrie Fitzgerald, who was paired with 3-year-old patient Colin Hill.
 
Click to view larger image Boston Children's Hospital patient-partner Joey Corcoran cheers on his runner, Suzanne Garwood, as the duo took part in its first Boston Marathon as part of the Credit Unions Kids at Heart program. (Credit Unions Kids at Heart photos)
"Every now and then someone would really yell my name with a purpose, and then I knew that it was someone I knew who was there offering everything they had to give me encouragement," said Fitzgerald, who was sponsored by Merrimack Valley FCU, Lawrence, with $495 million in assets. "It seemed like so many people all along the route were cheering for Children's! It was a tremendous feeling to know how many lives Children's has touched."
 
Patient-partner Andy Martin, who had been participating with runner Ray Phillips for 15 years, took to the course himself this year in the wheelchair division. Martin clocked in at 2 hours, 49 minutes, crossing the finish line in a special wheelchair purchased by his sponsor credit union, Hanscom FCU, Hanscom Air Force Base, Mass.  (See News Now April 10: Hanscom FCU supports Team Andy in Boston Marathon.)
 
The number of runners is growing every year, Bernstein told News Now. The marathon is fun for people to participate in, and the patient-partner program is a big part of the team's success, he said.
 
Since its inception, CU K@H has contributed more than $4.2 million to Boston Children's Hospital.

Financial stress seeps into workers' lives, CU-sponsored survey finds

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EAST WINDSOR, N.J. (5/16/14)--Stress over personal finances is diminishing the productivity of U.S. employees and negatively affecting the bottom line of employers, according to a new survey sponsored by McGraw-Hill FCU, East Windsor, N.J.
 
"Business leaders should be troubled that many of our nation's workers continue to face financial hardships and related stress, especially during working hours," said Shawn Gilfedder, president/CEO of the $310 million-asset credit union. "Companies can and should take action to help employees effectively address their financial concerns, which will help improve the lives of workers and their families and also help strengthen company performance," he added.
 
While the sluggish economy is on the rebound from the Great Recession, many consumers are still reeling financially, according to the survey, which was conducted by the Society for Human Resource Management.  Employees are facing ongoing struggles for a variety of reasons, such as medical expenses, credit card debt, and child and elder care expenses. Employees continue to need financial education.
 
Nearly two of five workers (38%) are facing more personal financial challenges now compared with the onset of the recession in late 2007, and slightly less than one-quarter (23%) of respondents indicated employees are experiencing more personal financial challenges now compared with 12 months ago.
 
"To overcome these challenges, companies must make the financial wellness of their employees a priority," said Gilfedder. "The good news is that there are easily accessible solutions to this problem--some with no cost to employers."
 
Gilfedder suggests companies consider a number of actions that can help to reduce employee financial stress, enhance employee retention, build loyalty and ultimately, improve company productivity and performance:
  • Employers should offer employees financial education programs and make financial wellness a vital component of organizational culture.
  • Financial wellness initiatives should be provided as part of a package which includes employee health and wellness programs to maximize benefits for individuals and organizations.
  • Financial wellness programs should be customized to address the specific needs of different generations of workers.
  • One-on-one financial counseling, financial and retirement planning and debt restructuring services should be key parts of every employer's financial wellness program.
  • Partnering with a credit union is an attractive no-cost means for employers to provide financial wellness benefits to employees. Because credit unions are not-for-profit financial institutions, they can provide employees with many low- and no-cost personal finance services including financial planning and counseling, higher interest rates on savings accounts, free checking and usually lower interest rates on loans and credit cards.
"Credit unions' financial wellness programs are an excellent no-cost benefit for companies to share with their employees," said Gilfedder. "We work as a trusted partner to deliver financial wellness for employees through a caring, consultative, and prescriptive approach.  We offer financial wellness resources that help employees gain greater control of their finances, resulting in fewer financial worries, less stress, better health and increased job productivity."

CUNA RegTraC adds new mortgage lending resources

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MADISON, Wis. (5/16/14)--The Credit Union National Association's compliance resource site, CUNA RegTraC, has added new mortgage lending regulation information.
 
"This is a significant addition to CUNA RegTraC, and something we know will bolster the compliance efforts of our nationwide subscriber base," said Melisa Kallestad, CUNA instructional design manager for compliance.
 
"Having easy reference to major regulatory disclosure requirements with real-time updates on closed-end mortgage loan regulation will prepare our credit unions to stay one step ahead of the 2014 compliance game," she added.
 
The newly added information identifies the major regulatory disclosure requirements for closed-end home-secured loans, starting with the requirements at the time of application through servicing of  closed-end mortgage loans. It also provides additional resources that may be helpful in understanding the regulatory provisions involved.
 
Designed for compliance professionals, management, senior executives and anyone needing a detailed regulations reference, RegTraC features compliance and legal updates in a downloadable PDF format.

Ohio governor appoints 2 to CU council

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COLUMBUS, Ohio (5/16/14)--Two credit union leaders have been appointed to the Ohio Credit Union Council by Gov. John Kasich.
 
Bill Burke, president/CEO of $278 million-asset DAY AIR CU, Kettering, and Greg Harper, president/CEO Ohio Valley Community CU, Clarington, with $129 million in assets, will fill vacancies and serve on the council through September 2016, the Ohio Credit Union League reported ( eLumination May 15).
 
The council advises the Ohio Division of Financial Institutions on matters affecting state-chartered credit unions, including field of membership, regulation, examination, and safety and soundness.
 
The council also confirms the annual supervisory fees assessed by ODFI to state charters.

Other council members include:
  • Christine Blake, president/CEO, $175 million-asset Cardinal Community CU, Mentor;
  • Vidya Iyengar, president/CEO, $56 million-asset Marion Community CU; and
  • Greg Kidwell, president, $214 million-asset, Pathways Financial CU, Columbus; and
  • Mike King, president/CEO, $11 million-asset Genesis Employees CU, Zanesville.

Branchless CU distributes $10M dividend

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WYOMISSING, Pa. (5/16/14)--Utilities Employees CU, a $1 billion branchless credit union serving America's utility and energy industry, has issued a $10 million dividend to its members.
 
Utilities Employees CU, based on Wyomissing, Pa., has made the branchless model work to its advantage since 1934, when the cooperative financial institution was formed to serve America's utility workers and their families, long before the development of the Internet and online banking. Today, the credit union serves more than 44,000 members in all 50 states, from its single facility in Pennsylvania.
 
"In 2013, we launched new services that add an even greater level of personalization to the UECU membership experience--all to help members achieve greater financial wellness and conveniently manage their family's finances from anywhere, at any time," said President/CEO Glen A. Yeager.

"On top of these new initiatives, our commitment to member giveback remained strong, with members receiving more than $10 million in financial benefits through UECU's 2013 Member Loyalty Bonus, rewards programs, and earnings on their savings," he said, adding, "Members saved millions more through lower loans rates and fewer fees than if they'd dealt with a bank."
 
Yeager credits his members' financial success to the organization's cooperative structure, and without shareholders or branches to maintain, the credit union is able to return a greater share of profits to its member-owners.
 
The credit union's annual meeting was held at its Wyomissing, Pa., headquarters and broadcast on the UECU YouTube channel for its nationwide membership.

GCUA's Mercer named chair of National Cooperative Bank

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WASHINGTON (5/15/14)--Mike Mercer, president/CEO of Georgia Credit Union Affiliates, was named chair of the National Cooperative Bank (NCB) during the organization's annual meeting last week.

NCB is a financial institution that serves cooperatives nationwide. Its 14 board members represent grocery, electric and housing co-ops, among others.
 
Mercer also served as NCB's board chairman in 2003.
 
He is also a member of the Credit Union National Association board of directors. He previously served as chairman of the CUNA board.
 
Mercer came to Georgia in 1980 as president of Georgia Central CU. He was named to his present position in 1985.

Education initiatives focus of N.Y. foundation report

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ALBANY, N.Y. (5/15/14)--In the New York Credit Union Foundation's annual report, education of credit union staff and members was a recurring thread.
 
Highlights from the 2013 report include:
  • The foundation provided 72 credit union employees and volunteer leaders with more than $39,000 in professional development grants for industry training and education;
  • Nearly 30 financial educators attended FEST 2013.
  • Seventeen credit unions received a total of $35,874 in financial fitness grants to enhance operations and improve member service.
  • A total of $10,941 in Smart Money grants was awarded to seven credit unions to help provide financial education to members or consumers.
Additionally, the foundation provided disaster relief grants to credit union employees, volunteers and members affected by Colorado floods and Oklahoma tornadoes in 2013.
 
"Supporting credit unions is what drives the foundation, and support from credit unions is what makes it all possible," said Vicki O'Neill, foundation board chair and president/CEO of ACMG FCU, Solvay, N.Y. "In the year ahead, the foundation will continue to provide credit unions, credit union professionals and volunteer leaders with grants to help fund professional development and financial education programs/initiatives."

Consumer debt load burdened most by student loans

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WASHINGTON (5/15/14)--Led by $31 billion in student loans, household debt increased for the third consecutive quarter, according to the Federal Reserve Bank of New York.
 
As the fastest-growing category, student loan balances now stand at $1.1 trillion--a number that is weighing down the economic capability of college graduates.
 
Led by $116 billion in mortgages, outstanding household debt ticked up 1.1% from the previous quarter to a total $11.65 trillion. However, new mortgage originations slumped for the third straight quarter, hitting $332 billion, the lowest since the third quarter of 2011.
 
Increased student-loan debt may be keeping those borrowers from taking on more debt in houses and cars, Fed researchers said Tuesday (The Wall Street Journal May 14).
 
A new Pew Research Center analysis of the most recent Survey of Consumer Finances, student debt was held by 37% of households headed by an adult age 40 or younger--up from 22% in 2001 and 16% in 1989. Those debt obligations are hindering wealth accumulation, Pew noted.
 
A household headed by a young, college-educated adult without any student debt obligations has about seven times the typical net worth, or $64,700, of households headed by debt-laden young adult at $8,700.
 
"We're simply saying that young adults with student loan debt are far behind in building their nest eggs," said report author Richard Fry (CNN.com May 14).
 
With auto loans and credit cards, younger households tend to be more indebted than older households, Pew noted, adding the leverage ratio of outstanding debts to household assets is even more heavily weighted in the young, college-educated, debt-holding households. At 67%, student debtor households are nearly twice as leveraged as those with no student debt at 34%.
 
The dissatisfaction with personal finances is higher in those who borrowed for college vs. those who didn't. They also are less likely to say their education has paid off.

Just4You streamlines product choices for members

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MADISON, Wis. (5/15/14)--Filene Research Institute and seven credit unions will test a Just4You, a product that helps consumers select financial products and services while avoiding overload.
 
"Our research has shown that when new members are faced with an onslaught of products, their easiest decision may be to make no choice at all," said Andrew Downin, Filene innovation director. "That's bad for credit unions and bad for members. We're testing Just4You in our alpha lab to validate our hypothesis that with effective systems in place, credit unions can offer the right products to the right members."

Originally developed and tested through Filene's i3 innovation program, Just4You is rooted in research that shows too many options lead to lower probability of purchase and decreased consumer satisfaction. This prototype helps credit union employees to open accounts for members that meet their individual financial needs based on six quick questions around financial preferences and habits.
 
Initial tests of the Just4You prototype at $1.2 billion-asset Westerra CU, Denver, and $1.1 billion Fort Knox FCU, Radcliff, Ky., showed that it increased the percentage of new members taking three or more products to 13% from 4% during the test period. Using Just4You more than doubled the rate of credit card acquisition by new members.
 
Credit unions that will test the Just4You product include:
  • County-City CU, with $24 million in assets, Jefferson, Wis.;
  • Heritage FCU, with $454 million in assets, Newburgh, Ind.;
  • Liberty Savings FCU, with $73 million in assets, Jersey City, N.J.;
  • Mid-Atlantic FCU, $268 million in asset, Germantown, Md.;
  • Park View FCU,  $127 million in assets, Harrisonburg, Va.;
  • Select FCU, $32 million in assets, San Antonio; and
  • St. Helens (Ore.) Community FCU, $172 million in assets.
Participants commit to using the Just4You prototype to open new member accounts in at least one branch. Filene will share the quantitative and qualitative results in a key findings report later this year.

Longtime CEOs stepping down, new leaders stand ready

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MADISON, Wis. (5/15/14)--New credit union leaders are stepping into the shoes of longtime credit union CEOs--some with decades of experience in the movement--who are retiring.
  • Lee T. MacMinn, a credit union advocate for 40-plus years, announced his retirement from Freedom CU, Warminster, Pa. When MacMinn became president/CEO in 1986, the credit union had $18 million in assets. As he hands the keys over to John King, current executive vice president/chief operating officer, the credit union will have more than $620 million in assets.

    In 2003, MacMinn initiated Freedom CU's application for a community charter, which was countered with a lawsuit by the Pennsylvania Bankers Association (PBA).  After two years of delays and administrative hearings, the Pennsylvania Department of Banking approved the field of membership, including the five-county Philadelphia area. The PBA continued to fight the expansion, finally losing its appeal in 2009 in the Commonwealth Court of Pennsylvania.
     
  • Anita Rauch is the first woman president/CEO of 80-year-old Heritage CU, a $259 million-asset credit union in Madison, Wis. Rauch has worked for the credit union for 31 years and has been president for the past three years. She succeeds Robert Lestina, who retired in March after 15 years at the credit union.
     
  • Tulsa, Okla.-based Red Crown FCU, President/CEO Marsha Schmidt is trading one nonprofit movement--credit unions--for another--early education (Leaguer May 14). Schmidt joined the $146 million-asset credit union as chief financial officer in 2003 and was promoted to CEO in April 2004. Her last day is May 31. Mike Moyer, senior vice president of lending at the credit union, has been selected as her successor.
     
  • In Springfield, Mo., the board of Community Financial CU, hired Loretta Roney to succeed Cathy Stroud, who is retiring June 2 after 32 years with the $57 million-asset credit union. Stroud's 42 years in the credit union movement included a stint as board chair for the Missouri Credit Union Association. Roney comes to Community Financial CU after being president/CEO at $18 million-asset Highway Alliance CU, Jefferson City, Mo.

Alliance FCU is 26th to fly Juntos Avanzamos flag

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FARMERS BRANCH, Texas (5/15/14)--Alliance FCU will become the 26th credit union recognized with the Cornerstone Credit Union League's Juntos Avanzamos designation or serving the financial needs of Hispanic families in Texas (Leaguer May 14).
 
Click to view larger image Click for larger view
The Juntos Avanzamos or "Together We Advance" designation is presented to credit unions that have successfully completed and passed a rigorous application process that demonstrates their commitment to Hispanic families.
 
The league will present the $217 million-asset Lubbock, Texas-based credit union with a Juntos Avanzamos flag on May 29. Cornerstone Credit Union League President/CEO Dick Ensweiler will officiate the ceremony.
 
Among the dignitaries attending the event will be Lubbock Mayor Glen Robertson.
 
Being a part of the Together We Advance "family" means that Alliance FCU offers member services such as:
  • Financial education;
  • Second-chance checking;
  • Credit-building loans and lines of credit;
  • Literature in Spanish; and
  • 24-hour automated service line and ATM services in Spanish.

UW CU commits $150K to UW financial life skills program

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MADISON, Wis. (5/15/14)--UW CU, Madison, Wis., has partnered with its namesake university, University of Wisconsin, to establish a series of life-skills courses focused on financial capability.
 
The UW Credit Union Financial Capability Fund, launched with a $150,000 donation from UW CU, was formed in collaboration with the university's School of Human Ecology (SoHE). It will support a series of three, one-credit "financial capabilities for life success" courses for students at the Madison campus.
 
"This innovative course is one in a series of SoHE courses designed to provide UW students with practical life skills, knowledge and experiential learning they will need to be successful after graduation," said Soyeon Shim, SoHE dean.
 
The program will start with a pilot group this fall and officially roll out in spring of 2015.
 
President/CEO Paul Kundert said the $1.7 billion-asset credit union is committed "to improving students' lives by giving them the foundation they need to make sound financial decisions."
 
Last year, UW CU delivered 25 financial education seminars to more than 1,800 students and faculty members.
 
"Financial literacy is a critical issue facing college students," said Jaimes Johnson, UW CU director of community and campus relations. "That's why we believe in doing our part to make a difference by giving students the tools they need to achieve financial stability."

CUNA institute advances service, sales skills

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MADISON, Wis. (5/15/14)--Registration is now open for CUNA Sales and Service Culture Institute, to be held Sept. 8-10, in Nashville, Tenn.

"Successful credit unions are demonstrating that sales and service, when practiced together, can deliver impressive results," said Carla Schrinner, Credit Union National Association Creating Member Loyalty implementation manager. "We often see service pursued at the expense of sales--or the other way around--and we'd like to change that trend by showing credit union professionals that they cannot only have both, but that each can help the other grow."

Advancing sales and service is about changing staff and organizational behaviors.  Using a change management model, the institute's sessions will explore the importance of organizational alignment and highlight the three distinct change phases and accompanying steps that an organization should go through to achieve a successful culture shift:
  • Transition;
  • Advancement; and
  • High performance.
This year's institute features best-practice discussions and networking opportunities that prepare attendees to define and develop a credit union culture that shapes member experiences, exceeds expectations and builds loyalty.
 
For attendees interested in aligning their credit union sales efforts, registrants receive a discount to attend CUNA Succeeding in Member Sales eSchool, to be held Aug. 13 to Sept. 3.

Car owners holding on to their wheels for more than 11 years

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WASHINGTON (5/15/14)--Americans are holding on to their vehicles longer, a development that could mean fewer lending opportunities for credit unions.
 
The average age of households' cars, vans, sport utility vehicles (SUVs) and trucks increased from 10.1 years in 2007 to just over 11.3 years in 2012, according to Bureau of Labor Statistics Expenditure Survey. The average age of cars, vans, SUVs and trucks reported in the survey all increased at similar rates from 2001 to 2012, even as the share of trucks and vans increased to 47.3% from 36.2%
 
The trend in aging autos coincides with declines in average household income in 2008 dating back to the recession. However, subsequent recovery in households' incomes and a return to previous levels of expenditures on vehicles in 2012 do not appear to have reversed the trend from consumers keeping their vehicles longer.
 
The proportion of newer vehicles, or those less than five years old, dropped to 15% from 22% between 2002 and 2012, while the proportion of older autos, or those manufactured at least 11 years ago, jumped to 42% from 34%.
 
The average annual maintenance cost per vehicle climbed to $537 in 2012 from $514 in 2011, not including average car insurance expenditures of $593 per vehicle and auto repair service policies averaging $7 per vehicle.
 
In 2012, households owning vehicles less than five years old reported the lowest maintenance and repair costs per vehicle. Households with vehicles averaging six to 15 years of age paid $151 more per vehicle per year, on average, for maintenance and repair than did households with newer vehicles.

CU System briefs (05/14/2014)

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  • HELENA, Mont. (5/14/14)--The Montana Credit Union Network recently hosted two officials from the Financial Regulatory Commission of Mongolia, including the director of the Microfinance Department (President's Report May 2). Jack Lawson, president/CEO, Missoula (Mont.) FCU, was their Montana contact and helped them gather information about building and supporting the credit union movement in central Asia ...
     
  • HIGHTSTOWN, N.J. (5/14/14)--On Friday, Bay Atlantic FCU, Vineland, N.J., hosted a Mother's Day bake sale that benefited the credit union's local Children's Hospital of Philadelphia (The Daily Exchange May 12). "Our staff did an awesome job baking and packaging the goodies for Mother's Day," said Gail Marino, president/CEO of the $50 million-asset credit union. Branch Manager Dominique Woodson, left, sells a Mother's Day treat to member James Mabry Friday. (New Jersey Credit Union League photo) ...
     
  • HIGHTSTOWN, N.J. (5/14/14)--The New Jersey Credit Union Foundation named Candice Nigro as the organization's executive director. Nigro, who is the director of marketing and communications for the New Jersey Credit Union League, had been staff liaison to the foundation since 2008 ...
     
  • KAILUA-KONA, Hawaii (5/14/14)--Hawaii Community FCU, Kailua-Kona, Hawaii, honored interim president/CEO Tom Griffiths, center, on his last day at the $385 million-asset credit union with "a hui hou" ("until we meet again") celebration. Griffiths spent four months at Hawaii Community FCU, which has hired Vice President of Corporate Development and Marketing Tricia Buskirk, left of Griffiths, to be president/CEO. The lei Griffiths is sporting is made of dollar bills folded to resemble leaves and held together in part by golf tees (Hawaii Community FCU photo) ...

Wis. league focuses on RBC proposal during annual meeting

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PEWAUKEE, Wis. (5/14/14)--Wisconsin Credit Union League President/CEO Brett Thompson stressed the negative effect the National Credit Union Administration's risk-based capital proposal would have on state credit unions during his membership address at the league's 80th annual convention last week.
 
Click to view larger image During the Wisconsin Credit Union League's annual meeting, Legal Counsel Paul Guttormsson gave some pointers on writing an effective comment letter to Jennifer Schilling, president/CEO of Empower CU, West Allis, and league board chair. (Wisconsin Credit Union League photo)
The Wisconsin league also assisted members in writing comment letters on the risk-based capital proposal to the NCUA.
 
Wisconsin credit unions will experience $200 million in lost capital. A full 82%, or 60 of 73 Wisconsin credit unions over $40 million in assets, would have their capital cushion shrink below "well capitalized" levels under the proposal.
 
The impact of the proposal would be far-reaching and long-lasting, Thompson said. Even though the new capital standard applies only to credit unions with more than $50 million in assets, every credit union should be concerned because the new standards would affect more credit unions as they grow, seriously curtailing their future plans for member service, Thompson said.
 
In related news on the risk-based capital proposal, Credit Union National Association President/CEO Bill Cheney said Tuesday that the hundreds of House members' signatures collected on a letter of concern over the National Credit Union Administration's proposed risk-based capital regulation--and the short timeframe in which they were collected--could never have been accomplished without the outstanding efforts of credit unions and their state leagues.
 
Also at the meeting, the league announced the results of its board elections:
  • Region 1--Jack Peplinski, president/CEO, $967 million-asset Altra FCU, Onalaska; 
  • Region 2--Jack Gill, president/CEO, $95 million-asset First Community CU of Beloit (treasurer);
  • Region 3--Jennifer Schilling, president/CEO, $104 million-asset Empower CU, West Allis (Chair);
  • Region 4--Kevin Ralofsky, president/CEO, $395 million-asset CitizensFirst CU, Oshkosh;
  • Region 5--Mike Mallow, president/CEO, $38 million-asset Sheboygan Area CU (vice chair);
  • Class A, less than $20 million in assets--Carol Pesci, president/CEO, $13 million-asset First CU, Oak Creek;
  • Class B, $20 million to $100 million in assets--Kimberly Youngblood, senior vice president/chief operating officer, $40 million-asset Focus CU, Wauwatosa (secretary);
  • Class C, $100 million to $500 million in assets--Tim Tranberg, executive vice president, $258 million-asset Co-op CU, Black River Falls;
  • Class D, more than $500 million in assets--Brian Prunty, president/CEO, $1 billion-asset CoVantage CU, Antigo; and
  • Young professional advisers to the board (non-voting)--Katy Cowdy, member finance representative, $1.4 billion-asset Educators CU, Racine; and Josh Roberts, controller, $28 million-asset Enterprise CU, Brookfield.

Filene paper: Women comprise 70% of CU staff, 41% of leadership

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MADISON, Wis. (5/14/14)--Among the facts highlighted in a new white paper from the Filene Research Institute, women comprised only 41% of credit union senior staff in 2012 despite making up 70% of the credit union workforce in the United States.
 
The white paper will serve as the touchstone for a colloquium hosted by the Filene Research Institute and the World Council of Credit Unions on the challenges and opportunities faced by women at every level in credit unions on June 19 at the University of Southern California.
 
"Women in Leadership: Obstacles and Opportunities," is the first report from Filene's Credit Union Women in Leadership International Research Series.  
 
"To begin to understand the processes that might drive the differential percentages of female CEOs across different-sized credit unions, we must step back to understand the barriers and accelerators in women's leadership roles in a broader sense," the report stated.
 
"The preponderance of female employees in credit unions creates the expectation of a culture that diverges from that of other financial institutions. Shouldn't that preponderance foster the advancement of all employees and allow women to maneuver to the top management positions within the credit union system? The data suggest that this has not universally been the case."
 
The report goes on to consider if people resist women's leadership, and if family concerns hold women back from leadership positions.
 
In coordination the Women in Leadership Colloquium, Filene will host a free webinar June 5 to explore woman's perspective in leading credit unions. To register use, the link.

CUs make Kansans' day 'the CU way'

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TOPEKA, Kan. (5/14/14)--On Tuesday, diners at Juli's Coffee and Bistro, Topeka, Kan., were greeted with the offer of a free lunch, courtesy of three Topeka credit unions and the Kansas Credit Union Association's "theCUway" promotion.
 
Three Topeka, Kan., credit unions told diners at Juli's Coffee and Bistro Tuesday that "lunch is on us" during #theCUway campaign. (New Century CU photo)
Beginning at 11 a.m., Jennifer Kirmse, Educational CU, with $185 million in assets; Tina Pfeifer, New Century CU, $19 million in assets; and Valerie Taylor, Quest CU, $271 million in assets, bought the downtowner lunch special for anyone who was interested (The Topeka Capital-Journal May 13).
 
The credit unions gave away a total of $1,000 during the "Make a Difference" campaign, which was teased through Facebook and Twitter with the hashtag "theCUway." One customer, who learned about the event on Facebook, brought in her two daughters for lunch.
 
Taylor, who is vice president of business development at Quest CU, said the campaign helps raise awareness of credit unions and show the values and benefits they give to the community.
 
"We think that doing this through a random act of kindness is the best way to do it," Taylor told the newspaper. "Sometimes that face-to-face interaction means so much more than a commercial spot or a billboard."
 
"TheCUway" campaign will continue Thursday in Arkansas City, Augusta, El Dorado, Lawrence, Manhattan, Marysville, Ness City, Newton, Norton and Wichita.

Card use shows more moms wined, dined for Mother's Day

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RANCHO CUCAMONGA, Calif., and FRANKLIN, Mass. (5/14/14)--Restaurants, book stores and craft shops were among the merchant groups that reported increased sales on Mother's Day 2014 compared to the same event the previous year, according to an analysis of debit card transactions by CO-OP Financial Services and Saylent.
 
"Did you know that Mother's Day was first celebrated in the United States in 1908, the same year that the country's first credit union was founded?" said Stan Hollen, CO-OP Financial Services president/CEO. "The purchasing activity this weekend by credit union members shows one great American tradition supporting another--and is another encouraging sign for the economy."  
 
The sales analysis is based on more than 11.4 million transactions made Friday through Sunday. The results cover debit card activity nationwide by members of credit unions that use CO-OP for transaction processing. The year-over-year comparison was performed through CO-OP Revelation analytics solution and conducted by Saylent's Insight360 consulting team. 
 
Among the highlights of the CO-OP Revelation data:
  • Restaurant transactions were up 12% from 2013 with a corresponding growth in total dollars spent of 11%.
  • The highest overall growth came from artist supply and craft shops, showing an 83% increase in total transactions.
  • Book stores showed solid growth, with a 17% increase in transactions and an 18% increase in total spend.
  • Among smaller volume merchants, precious stone, watch and jewelry merchants posted a 31% increase in overall spend.
  • Gas stations and fuel purchases grew slightly at a 6% rate in volume and a 7% rate in spend.
  • Mother's Day sales at florists, department and discount stores were generally flat from 2013 to 2014.

Hands-on reality fairs popular way to bring fin. ed. to students

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MADISON, Wis. (5/14/14)--Simulating the challenges of staying on a budget--with the occasional temptation or emergency thrown in--is the main focus of reality fairs that credit unions use to educate students of all ages.

Commonly held throughout the year, reality fairs pick up speed during National Financial Literacy Month, which was in April.

Students at Ocean County College Southern Education Center, Toms River, N.J., look over the housing options during a financial reality fair sponsored by New Jersey credit unions. (New Jersey Credit Union League photo)
Thirty-five students Ocean County College, Toms River, N.J., took part in the financial reality fair as part of a pilot program between New Jersey credit unions and the college's Southern Education Center (The Daily Exchange April 15).

For the college-level fairs, students are asked to provide information ahead of time. By submitting their current credit score, checking and savings account balances, current rent payment, number of dependents (children or adults), and expected student loan payment, the students then receive worksheets that are even more tailored to the simulation.

Many of these students were frugal, The Daily Exchange noted. Most chose to live at home, bought the least expensive car and worked part-time at a second job to make ends meet and stay within their monthly budget.

This week, the Pineywoods Chapter of the Cornerstone Credit Union League and People's Trust FCU, Houston, with $445 million in assets, presented CU 4 Reality programs to Hudson High School, Lufkin, and Kerr High School, Houston, respectively.

"These students from the time they first make money at a part-time job until long after they retire will need to be responsible and manage their money in a way that we more seasoned adults do not," said Julianne Slusher, CEO of $29 million-asset Lufkin FCU and vice president of the Pineywoods Chapter (Leaguer May 12).

John Kebles, REAL Solutions program manager, sets the stage for a Uniontown, Pa., credit union reality fair for students from Laurel Highlands High School, Albert Gallatin High School and the intermediate unit of Fayette County Technical Institute. (Pennsylvania Credit Union Association photo)
"These students may not have Social Security, or company retirement plans to fall back on. Their future could be what they save, so it's critical that they have the tools to do so," she added.

The El Camino Chapter of the California and Nevada Credit Union Leagues facilitated a "Bite of Reality" fair at Burlingame (Calif.) High School. Teacher Annie Miller, who also is a board member for $52 million-asset United Heath CU, helped bring the simulation to the high school.

Mad City Money also is a popular program during National Financial Literacy Month.

Rantoul, Ill., credit unions Community Plus FCU, with $19 million in assets, and Credit Union 1, with $745 million in assets, presented the program to Eater Junior High School, Rantoul. A total of 128 eighth-graders were assigned a profession then tasked to manage finances based on situations given to them.

Media often pick up on these community financial literacy programs. Mad City Money and Central Macomb Community CU, Clinton Township, Mich., with $163 million in assets, were the subject of a feature article in The Macomb Daily (April 23). Photos of earnest students at L'Anse Creuse High School and quotes such as "Money goes fast, and the kids are expensive--I need to make more than $3,000 a month," help show the impact that these exercises have.

CU System briefs (05/13/2014)

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  • COLCHESTER, Vt. (5/13/14)--Two representatives of Williston, Vt.-based New England FCU, with $988 million in assets, have been named to the Vermont Financial Literacy Task Force (NewsLines Express May 9). Art Woolf, director, and Susan Leonard, senior vice president/chief financial officer, join 17 others from education, government, business and the nonprofit sector to help policymakers understand the state's financial illiteracy problem  ...
     
  • DENVER (5/13/14)--Colorado CU, Littleton, with $118 million in assets, and Englewood (Colo.) FCU, with $3 million in assets, announced their merger. The merger was unanimously approved by the board of Englewood FCU, whose members include City of Englewood employees ...
     
  • ST. CLOUD, Minn. (5/13/14)--St. Cloud (Minn.) FCU hired Jed Meyer as president/CEO to replace Bill Winter, who retired from the $104 million-asset credit union March 31. Meyer previously was a director at St. Paul-based Affinity Plus FCU, with $1.7 billion in assets (St. Cloud Times May 10). He also has worked at SharePoint CU, Hopkins, Minn., with $182 million in assets ... 
     
  • HERRIN, Ill. (5/13/14)--Erma Petroski, who served on three credit union boards in southern Illinois, died Friday in Herrin, Ill. She was 83 (The Southern Illinoisan May 11). Petroski was president, treasurer and board member of the Southern Illinois Schools CU, Herrin, with $15 million in assets. She also was a director for the Egyptian Chapter of the Illinois Credit Union League. Petroski also served on the boards of the Vienna (Ill.) Correctional Center CU (now River to River CU), with $15 million in assets, and the Williamson County Catholic CU, Herrin, with $2 million in assets ...

Minn. CUs sustain growth pattern in 1st quarter

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ST. PAUL, Minn. (5/13/14)--Minnesota's credit unions showed year-over-year growth in assets, deposit and loan growth in the first quarter, according the Minnesota Credit Union Network.
 
Assets increased by $704 million, deposits rose $605 million and loans were up $687 million compared with year-ago figures for the first quarter, the league said.
"The growth we're seeing is a good sign of consumer and business confidence," said Mark D. Cummins, president/CEO of the league. "Credit unions are helping communities grow and are also contributing to Minnesota's overall economic health."
 
The latest available membership results show that Minnesota credit union membership grew by 10,000 in the fourth quarter of 2013 to reach 1,617,000--a 0.6% growth rate. The pace is faster than the 0.4% reported in the fourth quarter of 2012.
 
Minnesota credit union assets grew by 3.82% year-over-year between the first quarters of 2013 and 2014, with a 3.14% growth between the fourth quarter of 2013 and the first quarter this year.
 
Deposits at Minnesota credit unions increased 3.74% year-over-year from first quarter 2013 to 2014. Between the fourth quarter of 2013 and the first quarter this year, deposits increased by 3.36%.
 
While loan balances fell 0.72% in first quarter of 2014, reflecting a continuing seasonal slowdown in loans seen nationwide, year-over-year loan growth for the same period was strong at 6.67% between 2013 and 2014.
 
Minnesota credit unions are rated as "well-capitalized" by the National Credit Union Administration (NCUA), with a reported net worth of 10.05% in the first quarter of 2014. The NCUA considers a credit union as well-capitalized if its net worth is above 7%.
 
"Minnesotans are strong advocates for local, member-owned credit unions," said Cummins. "Credit unions work for people--not for profit--and consumers continue to choose credit unions because they align with their values."
 

Fewer carry currency as cards crush cash

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NORTH PALM BEACH, Fla. (5/13/14)-­-What's in your wallet? A $20 or smaller? According to the May Financial Security Index from Bankrate.com, two of five consumers carry less than $20 cash on a daily basis.
 
Instead of greenbacks, consumers are using alternatives such as debit cards, prepaid gift cards, credit cards and smartphones with electronic payments apps.
 
The electronic payments industry "is doing a good job shifting people away from cash," said George Peabody, a payments strategist at research firm Glenbrook Partners (Bankrate.com May 12). But, he added, "Cash is going to be remarkably resilient. I'm not expecting cash to disappear anytime soon."
 
On a day-to-day basis, more than two-thirds of the respondents carry $50 or less, 49% have $20 or less in their pockets, and 9% said they don't carry cash at all.
 
Women tend to carry less cash than men which, said Bankrate's chief financial analyst Greg McBride, suggests that some women "may prefer to carry less cash than men so as to reduce the risk of being a target for criminal activity."
 
Carrying cash can have a psychological effect on spending. University of Missouri student Hannah Cushman, 22, told Bankrate that if she has cash, not only does she spend it, but she also spends more on her debit card. "It's a weird kind of wealth effect," she said.
 
Cash is the dominant payment form for transactions worth less than $10, according to an April report from the Federal Reserve. It's most commonly used for gifts, transfers to people, food and personal care.

However, data security breaches like the one at retail giant Target have made some consumers wary of plastic payments. A March survey by cybersecurity firm Feedzai found that 40% of consumers who knew about data breaches were using cash more often and plastic less so (The Wall Street Journal March 21).
 
Natural disasters are an example of where cash is still important, said Paul Sullivan, vice president/general manager of Agility Recovery (News Now April 30). "We all know that during a major event cash is always king. You may not always be able to use cards because services could be down."

Survey: Savers get higher CD rates from CUs than banks

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LOS ANGELES (5/13/14)--Old news is good news for consumers who make credit unions their financial institution of choice. Credit unions continue to have better rates than banks on certificates of deposits, on average--between 1.5 and 1.75 times higher, depending on the term, according to the latest information from GoBankingRates.com.
 
GoBankingRates surveyed current CD interest rates across six-month, 12-month and 24-month terms, finding that rates have steadied in the last year.
 
Credit unions offered an annual percentage rate of 0.65% on 24-month CDs, compared with a 0.47% APY for banks on certificates with the same term. On 12-month CDs, credit unions offered an average a 0.42% APY, while banks offered 0.29%. Credit unions on average extend a 0.28% APY on six-month CDs, compared with a 0.18% rate for banks.

Three CUs tapped as Mich. innovators

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LIVONIA, Mich. (5/13/14)--The Michigan Credit Union League announced the winners of its Innovation Awards, which celebrate creative thinking and groundbreaking ideas (Monitor May 12).
 
By asset size, this year's honorees are:
  • Up to $50 million in assets: Greater Niles Community FCU, Niles, launched its Hometown Connections program in which members receive a card that entitles them to discounts at select local businesses.
  • $50 million to $400 million in assets: KALSEE CU, Kalamazoo, not only raised money for bulletproof vests for the city's K-9 police dogs, it also set a Guinness World Record for the most coins--869--tossed in a bucket in one minute.
  • $400 million in assets and above: Impact Saginaw is an effort by 16 credit unions in Saginaw County to support free events for children and families who might otherwise not be able to attend due to financial hardship. The events, which spotlight the Saginaw community, have included a youth triathlon, a back-to-school celebration at the Saginaw Children's Zoo and a recent family concert by The Verve Pipe.
This year's winners will be recognized at the league's annual convention June 5-7.

Carolinas foundation awards inaugural philanthropy honors

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KERNERSVILLE, N.C. (5/13/14)--The Carolinas Credit Union Foundation (CCUF) announced the recipients of  its individual and partner philanthropy. The awards will be presented at the CCUF Awards Gala May 30 in conjunction with the Carolinas Credit Union League annual meeting.
 
The Carolinas Credit Union Foundation will present the awards the first time. The foundation takes over the responsibilities from the former North Carolina and South Carolina credit union leagues, which merged in 2013. The foundation will award four individuals and one business partner with Individual Achievement and Partner in Philanthropy Awards.
 
Award winners include:
  • Individual Professional Achievement--David Brehmer, president/CEO, First Carolina Corporate CU, Greensboro, N.C.
  • Individual Volunteer Achievement--Travis Walters, chairman, $125 million-asset Sonoco Products Company (SPC) CU, Hartsville, S.C.;
  • Lifetime Professional Achievement--John Carlson, retired president/CEO, $1billion-asset Sharonview FCU, Fort Mill, S.C.;
  • Lifetime Volunteer Achievement--George Price, vice chair, $5 million-asset Piedmont Advantage CU, Statesville, S.C.; and
  • Partner in Philanthropy--CUNA Mutual Group, Madison, Wis.

Retirement fairs put post-work assumptions to the test

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MADISON, Wis. (5/13/14)--The National Credit Union Foundation's retirement fairs appear poised for growth that, with some good fortune and planning, could mirror that of the similar financial reality fairs that credit unions offer to students.

Click to view larger image Click for larger view
In just a year-and-a-half throughout Illinois, more than 560 people have participated in retirement fairs, and 70 credit union staff and volunteers have completed the "train-the-trainer" program which teaches people how to host and conduct the fairs.

The Illinois Credit Union Foundation introduced the National Credit Union Foundation's (NCUF) "Route Your Retirement" retirement fair program during the fall of 2012.
The interactive fair is designed to have people think more carefully about the type of lifestyle they would like to pursue in retirement and then link it to their financial plan.

Participants visit seven lifestyle booths during the fair. At each booth they ponder a series of questions and then make an assessments about how much they will most likely spend on that aspect of their retirement lifestyle. After visiting each booth they then hear how to link their lifestyle choices to their retirement savings.

Participants are strongly encouraged to get detailed advice from a retirement planner who will help them assess whether they are on track to be able to finance the lifestyle options they chose. A participant takes between 45 and 60 minutes to complete the process.

With support from CUNA Mutual Group, NCUF offers retirement fairs for leagues and credit unions nationwide. For example, credit unions in Illinois have embraced the fairs as an effective way to educate adults about the importance of saving for retirement.

"It is a new, fresh approach to an important subject," said Melanie Murphy, Illinois Credit Union Foundation manager. "The fairs are a great way for credit unions to interact with members and potential members that provides educational value to the participants and also allows the credit unions to showcase how they can help people throughout their lives."

The New Jersey Credit Union Foundation recently announced it would offer the program to state credit unions at no cost. The foundation hosted an informational session on the retirement fair earlier this year. Based on interest from credit unions, the foundation decided to adopt the program, the New Jersey Credit Union League reported (The Daily Exchange May 12).

NCUF opens nominations for Wegner awards

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MADISON, Wis. (5/12/14)--Credit union supporters have until July 31 to nominate individuals and organizations for the Herb Wegner Memorial Awards to be presented by the National Credit Union Foundation.
 
Winners will be honored at NCUF's annual awards dinner March 9 in conjunction with the Credit Union National Association Governmental Affairs Conference in Washington, D.C.
 
Nominations are for:
  • The Individual Achievement Award, which honors an unsung hero for innovative concepts, accomplishments that are ongoing and current, contributions to the credit union community, and work within the past three to five years. Accomplishments must have had a significant impact or potential impact on the local, national or international credit union movement with measured results. Nominations must cite a specific subject of achievement such as financial literacy, service to the underserved, alternatives to predatory lending, or new products.
  • The Outstanding Organization/Program Award, which honors an organization, program or business for innovative concepts, product or services that have had a significant impact on the local, national or international credit union movement with measured results.
  • The Lifetime Achievement Award, which honors an individual who has dedicated his or her life to promoting the credit union philosophy, created innovative concepts and provided leadership that has had a significant and lasting impact on the local, national or international credit union movement.
Nominations can come from individuals or organizations. To make a nomination:
  • Complete the Wegner Awards nomination form on the NCUF website;
  • Gather at least five letters of recommendation citing examples of the nominee's achievements relevant to the award criteria; and
  • Send the nomination form and recommendation letters electronically to NCUF by July 31.
Questions about the Wegner Awards can be directed to Danielle Brown at dbrown@ncuf.coop or (608) 556-2406.

CU System briefs (05/12/2014)

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  • ALBANY, N.Y., and CHARLOTTESVILLE, Va., (5/12/14)-- The numbers of "Biz Kid$" recipients keep rolling in as credit unions continue to report their donations of the financial education television program to Children's Miracle Network (CMN) Hospitals . Every CMN Hospital that serves New York residents received DVD box sets thanks to the efforts of the Credit Union Association of New York's multiple chapters ( The Point May 9). University of Virginia Community CU, Charlottesville, with $655 million in assets, donated a set to University of Virginia Children's Hospital. The $655 million-asset credit union also underwrites the series on WVPT-TV . Ryan Lightner, left, Children's Miracle Network program coordinator, University of Virginia Children's Hospital;  Rebecca Cardwell, vice president of community relations, University of Virginia Community CU; and Anne Jolly, WVPT-TV. The donation program is an initiative of the National Credit Union Foundation which sought to get copies of "Biz Kid$" in every CMNH during the month of April, which was National Financial Literacy Month. ...
     
  • ALBANY (N.Y.) (5/12/14)-- The Credit Union Association of New York won two Communicator Awards , a program judged and sanctioned by the International Academy of Visual Arts, in the newsletter/association and brochure/capabilities categories. It also earned four Hermes Creative Awards from the Association of Marketing and Communication Professionals for video/corporate image, publications/brochure, writing/publication article, and writing/opinion piece ( The Point May 9) ...
     
  • HAVERHILL, Mass. (5/12/14)-- Merrimack Valley CU, Lawrence, Mass., had a Friday morning surprise for its Facebook fans. The first 265 drivers who showed up at Haffner's gas station in Haverhill had their gas pumped and paid for by the $495 million-asset credit union . "Social media has made special events fun to host and promote," said CEO Peter J. Matthews Jr. "It feels good to reward our Facebook followers for their loyalty." Matthews himself was manning the pumps. At right, Merrimack Valley CU employee Elizabeth Pearl encourages drivers to stop and get free gas during the credit union's #FreeGasFriday program. (Merrimack Valley CU photo). ...
     
  • SOMERVILLE, Mass. (5/12/14)-- Cambridge Portuguese CU (CPCU CU), Somerville, Mass., announced a name change that reflects its Portuguese-American heritage . The name change to Naveo CU was approved at the $112 million-asset credit union's annual meeting April 29. The name has strong ties to the navigational skills of the Portuguese people and s derived from the Portuguese word "navio," meaning ship. According to the credit union, Naveo is about providing support and helping members find the way on their financial journey ...
     
  • WESTBROOK, Maine (5/12/14)-- Donald Fortin, former president/CEO of KV FCU (former St. Augustine CU), Augusta, Maine, died April 30 . He was 76. Fortin, who led the now $56 million-asset credit union from 1966 to 1990, received the Maine Credit Union League's James M. Gratto Award for Outstanding CU CEO in 1989. "Don was committed to his credit union and members, as well as helping his community," said league president John Murphy ( Weekly Update May 9) ...

Ill. foundation distributed $52K in first quarter

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NAPERVILLE, Ill. (5/12/14)--The Illinois Credit Union Foundation has been on a tear of late, awarding nearly $52,000 in grant funding to state credit unions through their various grant programs.

The grants committee--for this first round of grants for 2014--delivered $27,900 in small credit union development, community service, and marketing and business development grants in the first quarter, and $24,075 in scholarships.

Broken down, the foundation handed out the bulk of its grant funding in the form of small credit union development grants, totaling $22,250 spread among 14 Illinois credit unions.

Five community service grants, created by the league to encourage participation in local community projects, were also awarded, totaling $1,150 among four credit unions and one league chapter.

Applicants for grants qualify by hosting or volunteering at an established event, or developing their own event.

Finally, four credit unions received marketing and business development grants worth a combined $4,500. The grants were formed in 2006 to assist credit unions with assets of $30 million or less to start or expand their outreach efforts.

The next grant request deadlines are July 31 and Oct. 31. Scholarships are reviewed on an ongoing basis and awarded as funds permit. 

Member business lending force for social good

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BISMARCK, N.D. (5/12/14)--A column in the Credit Union Association of the Dakotas' May 7 Memo newsletter by Phil Love, president/CEO Midwest Business Solutions (MWBS), praises credit union business lending as a force of social good.
 
MWBS is a Rapid City, S.D.-based commercial and agricultural lending credit union service organization.
 
"What comes to your mind when I mention how a credit union improves the social well-being of a community?" Love wrote. "One item I rarely hear mentioned is how business lending from a credit union improves the social good of a community.  I believe that commercial and agricultural lending provide one of the best methods a credit union has to impact its territory. "
 
Love praises small business owners for their impact on job creation, citing national statistics that show the U.S. workforce shed 806,000 jobs in April.
 
"Every commercial or agricultural loan we have closed at MWBS has either added or retained jobs from the business client," Love wrote. "The impact we have is families being started on sound financial footings, allowed houses and other items to be purchased, sent kids to college, and started families. Many times, the greatest social good can be accomplished through your activities with your business or farm client."
 
The Credit Union National Association and credit unions are urging Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. CUNA and credit unions say that increasing the cap would open up more opportunity to offer MBLs, inject $13 billion in business loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers.
 
To read the article use the link.

Va. CUs report $882M in member benefits

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LYNCHBURG, Va. (5/12/14)--With better loan and savings rates, and fewer fees than for-profit banks, Virginia-based credit unions delivered $882 million in direct financial benefits to their members in 2013, the Virginia Credit Union League reported Friday in its 2013 Impact Report.

"As member-owned financial cooperatives, our mission is simply to serve our members and work toward the betterment of our communities," said Rick Pillow, league president. "Our credit unions touch the lives of millions each day, meeting their needs for home loans, car loans and many safe, insured options for retirement savings."

Among the highlights in the impact report:
  • At year-end, the state's 166 credit unions boasted a membership total of 8.41 million, adding 653,000 members in 2013. Owed to the large number of credit unions based in Virginia that serve the military and various federal agencies, members of Virginia-based credit unions are spread worldwide. An estimated 3.25 million credit union members reside in Virginia.
  • Virginia-based credit unions have modified $741 million in mortgage loans in the years following the financial crisis of 2008. More than $57 million in mortgage loan modifications were originated in 2013 alone.
  • The state's credit unions originated 72,920 first mortgages totaling $18 billion in 2013.
  • Virginia credit unions provided $386 million in member business loans during. These loans help state businesses create jobs, purchase equipment and grow. At year-end, state credit unions had a total of $1.1 billion in outstanding member business loans.
  • In a survey conducted by the league, the 26 credit unions that responded noted that they originated $25.2 million in small loans (non-credit card loans of $3,000 or less) in 2013. These loans aided almost 20,000 members, 53% of whom were characterized as having "poor" or "very poor" credit--comparable to a credit score of 620 or below.
  • During the 2012-2013 school year, Virginia-based credit unions reported reaching 21,174 students with lessons on budgeting, saving and spending money wisely. Since 1999, state credit unions have collectively reached 282,849 students with lessons in personal finance basics.
  • In 2013, credit unions collectively donated $406,236 to the Children's Miracle Network Hospitals serving Virginia, the highest single-year donation to date in the decade-long partnership between CMN Hospitals and Virginia's credit union system. Since the start of that partnership in 2003, Virginia's credit unions have collectively contributed more than $2 million to CMN Hospitals.
To download the report, use the link.

Extreme, leadership synonymous to ACUC speaker

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MADISON, Wis. (5/12/14)--While the idea of "Extreme Leadership" is the cornerstone of Steve Farber's work, to the man who travels the country championing this message, the term is actually redundant.

To lead, Farber believes, one must be extreme.

"People use the words leader and leadership too loosely," Farber told News Now . "It's so much more than a title. Someone who is really leading is involved in the active transformation of their (organization). We're looking at what's around us and thinking 'How it can be significantly better?'

"It's my way of trying to get people to understand that it's not enough to call yourself a leader. You need to be extreme--it's just real leadership."

Farber, founder of The Extreme Leadership Institute and author of "The Radical Leap" and "Greater Than Yourself," will introduce these principles and more at the Credit Union National Association's 2014 America's Credit Union Conference, set for June 29 to July 3 in San Francisco.

As a keynote speaker, the leadership consultant hopes to imbue the idea of extreme leadership into credit union leaders from across the country by offering explicit ways they can continue to drive the success of their organizations, in addition to the global credit union movement.

"I'm going to give them a road map for practicing extreme leadership in credit unions," Farber said. "It's not a theoretical discussion. (I'll give) lots of examples, give them very specific things to think about and talk about and work with when they go back to work."

CUNA's ACUC will bring together the credit union movement's top experts and decision makers and will provide leaders with the opportunity to network and share ideas about how to further the success of the industry.

In addition to Farber, the conference will feature several other keynote speakers, including Marcus Luttrell, a former U.S. Navy Seal who will tell his story of courage, integrity, patriotism and community; Simon Sinek, an adjunct member of the RAND Corp., who will talk about how organizations and their leaders can inspire others; and recently announced Amber MacArthur, a digital media expert.

For more details on the event, use the resource link.

Farber has worked with a wide array of organizations and businesses, but with several speaking engagements at various credit union events already on his resume, he finds that his idea of leadership seems to particularly align with the philosophies held by those involved in the credit union movement.

Consider the credo of extreme leadership: Doing what you love in the service of people who love what you do. That sentiment lends itself quite well to the work carried out every day by credit unions and their leaders, Farber says.

"The relationships that credit unions strive to build with their members, it's a very special thing, and that's why I find myself being drawn into that credit union world," Farber said, adding, "Extreme leadership is an act of the heart.

"(Members) choose a credit union because there's a more intimate relationship there; extreme leadership is a very personal thing."

Members reap benefits from CU's credit score analysis

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FARMERS BRANCH, Texas (5/12/14)--By taking the mystery out of credit scores, FAA CU, Oklahoma City, Okla., has put money back in the pockets of consumers.
 
The free Credit Score Analysis (CSA) program has reportedly saved Oklahoma residents more than $10 million over 18 months ( Leaguer May 9). The $551 million-asset credit union thoroughly reviews a consumer's current credit score and identifies areas of improvement.
 
The amount saved is calculated by comparing what the consumer would have paid in interest over the life of the loan vs. the new, lower interest loan options.
 
In addition to the financial benefit, consumers walk away with greater knowledge about how a healthy credit score positively affects many areas of their lives such as insurance premiums, utility deposits and job opportunities. They also can use FAA CU's SeeYourScoreSoar.com website to learn more.
 
"FAA Credit Union is the only financial institution in central Oklahoma providing this type of service,"  President Steve Rasmussen told Leaguer . "We understand the importance of credit scores in today's world and we want to do everything we can to help our neighbors save money."
 
Following a review by specially trained FAA CU representatives, consumers receive a step-by-step plan with ways to potentially increase the credit score. Once the CSA is completed, the credit union is often able to offer lower interest rates on existing loans.
 
"FAA Credit Union is the only financial institution in central Oklahoma providing this type of service," says FAA CU President Steve Rasmussen. "We understand the importance of credit scores in today's world and we want to do everything we can to help our neighbors save money."
 
Appalachian Community FCU, Gray, Tenn., is turning its credit score analysis toward the needs of the small business owner. The Kingsport Office of Small Business Development and Entrepreneurship, the Kingsport Chamber of Commerce and Small Business Development Center ETSU--Kingsport Affiliate also will be on hand for the May 22 session.
 
Candy Craig, executive director of community development of the $170 million-asset credit union, said, "Many of us want to take advantage of flexibility in our spending plans by using credit. When used wisely, credit can be a great tool."
 
"Boost Your Credit Score in 2014" is open to anyone interested in learning the ins-and-outs of bettering their credit score, especially as it relates to small business capital.

Five elected to LSCU board

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BIRMINGHAM, Ala., and TALLAHASSEE, Fla. (5/12/14)--Five credit union leaders have been elected to the League of Southeastern Credit Unions (LSCU) board of directors, the league announced last week.

Three new board members and two incumbents were selected to round out the 16-member body, which draws from both Alabama and Florida.  

The incumbents are Tina Williams, CEO, Mobile (Ala.) Educators CU, with $74 million in assets, and current vice chairwoman; and Mary Ott Wood, CEO, Florida West Coast CU, Brandon, Fla., with $83 million in assets, and current board chair.

Williams and Wood will be joined by Brad Green, CEO, Listerhill CU, Muscle Shoals, Ala., with $629 million in assets; Jerry Bolduc, CEO, Monroe County Teachers FCU, Key West, Fla., with $21 million in assets; and Caryl Greene, CEO, MembersFirst CU of Florida, Pensacola, with $159 million in assets.

Both Green and Greene each have served as directors of LEVERAGE, the league's service corporation, for several years. Bolduc will only serve a two-year term on the league board as he will replace Leianne Harden, CEO, Florida Customs FCU, Tampa, Fla., with $9.2 million in assets, who stepped down halfway through her term.

The nomination and election process unfolded in May. All five will officially begin their terms following the league's annual business meeting in June.

R.I. annual meeting fetes 80 years

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PROVIDENCE, R.I. (5/12/14)--The Credit Union Association of Rhode Island celebrated its 80th annual meeting May 7 with an award presentation and the announcement of election results.
 
Click to view larger image The Credit Union Association of Rhode Island presented state general treasurer Gina Raimondo, middle, with the Desjardins Financial Education Award on behalf of the Credit Union National Assocation at the league's 80th annual meeting. Joining Raimondo are league Chairman David Suvall, left, president/CEO of Rhode Island CU, Providence; and league President Paul Gentile. (Photo provided by Credit Union Association of Rhode Island)
Rhode Island General Treasurer Gina Raimondo was presented with the Desjardins Financial Education Award by league Chairman David Suvall, president/CEO of Rhode Island CU, Providence; and league President Paul Gentile, on behalf of the Credit Union National Association. 
 
Raimondo praised the commitment that Rhode Island credit unions share with her in providing financial education to young people. "It's what we do together, strengthening Rhode Island one young person at a time, one family at a time," she said.
 
Also at the meeting four directors were re-elected to three-year terms:
  • Ellen N. Ford, CEO, $379 million-asset The People's CU, Middletown;
  • James M. Irving, president/CEO, $387 million-asset Greenwood CU, Warwick;
  • Eugene V. Leco, president, $12 million-asset Kent County Memorial Hospital FCU, Warwick; and
  • Kenneth Saunders, president/CEO, $22 million-asset Community & Teachers FCU, East Providence. 
 Newly elected to three-year terms were: 
  • Stephen J. Angell, president/CEO/general counsel, $123 million-asset Dexter CU, Central Falls;
  • Robert T. Falso, executive vice president/chief financial officer, $224 million-asset Westerly Community CU; and
  • David L. Root, president/CEO, $230 million-asset Coventry CU.
Board member Stephen White, president/CEO of Westerly CU, who did not to seek re-election, was honored for more than 35 years of service to the credit union movement. White served as a league director since 2002 and was chairman from 2010 to 2011.

Public funds, prize-linked savings advance in N.Y.

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ALBANY, N.Y. (5/12/14)--Just after the Credit Union Association of New York completed its state Governmental Affairs Conference (GAC), two key pro-credit union pieces of legislation passed through the Senate Banks Committee.
 
During the May 7 session, the committee approved S.5016, a bill that would create a credit union state funds deposit program, and sent it to the Senate Finance Committee. Financial institutions could offer prize-linked savings programs under S. 6805, which is headed for the Senate floor for vote ( The Point May 8).
 
The advancement of the legislation came just days after nearly 150 credit union advocates gathered in Albany. Several sponsors added their support after the GAC meetings.
 
House legislation regarding the state credit union charter, penalties for demand note robberies and credit unions' ability to be depository institutions for local government also gained supporters after the GAC.

American Airlines' Owens named to CUNA Mutual board

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MADISON, Wis. (5/9/14)--Angela K. Owens, president/CEO of American Airlines FCU, has been appointed to the CUNA Mutual Group board of directors.
 
Owens has been president/CEO of the $5.6 billion-asset, Fort Worth, Texas-based credit union since 2008. American Airlines FCU employs 580 people and has more than 230,000 members.
 
Owens brings finance and accounting experience to the CUNA Mutual board, having also held multiple leadership positions at commercial air carrier American Airlines.
 
"Angie has been a results-driven leader at every point in her career," said Robert N. Trunzo, CUNA Mutual Group president/CEO. "She's a strategic thinker who understands an organization's balance sheet and will be a valuable addition to the CUNA Mutual Group Board."
 
Also this month, terms are expiring for three CUNA Mutual Group board member.  All three are former board chairs, including: Alan Peppers, president/CEO, $1.2 billion asset Westerra CU, Denver; Larry Wilson, retired president/CEO, $2.2 billion-asset Coastal FCU, Raleigh, N.C.; and Loretta Burd, retired president/CEO, $1.1 billion Centra CU, Columbus, Ind.
 
With the expiring terms, and the addition of Owens, the board will stand at 11 director positions going forward, with 10 of them being outside directors, along with the CEO.
 
"Our board of directors brings strong insight to lead CUNA Mutual Group to long-term success," Trunzo said. "The board is an even mix of leaders from the credit union industry and those with business experience from other businesses.  This ensures we remain true to our credit union heritage while also embracing broad viewpoints. Our policyholders can be assured this board composition means their insurance company is being guided by world-class leadership."

CU System briefs (05/09/2014)

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  • MORGANTOWN, W.Va. (5/9/14)-- The West Virginia Credit Union League elected its executive committee at its recent annual meeting in Morgantown, W.Va. Donna Gordon, manager, Mercer County WV Teachers FCU, Bluefield, was re-elected chair. Also re-elected to the committee were: First vice chairman, Carol Johnson, CWV Tel FCU, Clarksburg; second vice chairman, Lynne Teets, Whetelco FCU, Wheeling; treasure, Mike Tucker, WV Central CU, Parkersburg; and secretary, Joetta Heck, Kemba Charleston FCU, Dunbar. William "Bill" Milam, Pioneer WV FCU, Charleston, received the William Bryan Hawkins Award, the league's highest volunteer honor among credit union officials ...
  • BISMARCK, N.D. (5/9/14)-- Credit Union Association of the Dakotas President Robbie Thompson announced the following staff updates : Jeff Olson is now executive vice president of government affairs; Amy Kleinschmit is now vice president of compliance; and Trish Shomion is now vice president of marketing. "We have a lot of great things in the works and a lot going on, and the new titles recognize the good work of these employees," Thompson said ( Memo May 7) ...
  • ALBANY, N.Y. (5/9/14)-- The credit union movement in New York was noted once again for having great places to work. In the small- to medium-employer category, the Credit Union Association of New York placed ninth in the 2014 Best Companies to Work for in New York, based on employee surveys and workplace evaluations by the Best Companies Group. Also in the category were SeaComm FCU, Massena, with $460 million in assets, and Quorum FCU, Purchase, with $7778 million in assets, in 12th and 13th place, respectively. Hudson Valley FCU, Poughkeepsie, with $3.8 billion in assets; Empower FCU, Syracuse, with $1.2 billion in assets; and AmeriCU CU, Rome, $1.2 billion in assets, received awards in In the large-employer category for 250 or more employees. "The Credit Union Association of New York is committed to maintaining a culture that empowers employees both personally and professionally, so being recognized as a top 10 employer in the state is very validating," said President/CEO William J. Mellin ...
  • ST. LOUIS (5/9/14)-- The Missouri Credit Union Association's Bank On More campaign earned three Communicator Awards, a program sanctioned and judged by the International Academy of Visual Arts ( Missouri Difference May 5). It was honored with two excellence awards in print advertising-advertising campaign and outdoor/environmental advertising-advertising campaign and an award of distinction for integrated campaign-business to consumer. "It was wonderful to hear that Bank On More's messaging and creative concepts resonated with communication industry experts," said Halley Abbott, league vice president of communications. The initiative also was shortlisted for this week's SABRE Awards Americas under the financial services category ...

Schools book $520K from Texas Trust CU reward program

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MANSFIELD, Texas (5/9/14)--Buy a pack of gum, fill up your tank with gas, spring for dinner--make sure to pay with your credit union-issued debit card--and raise a whole bunch of cash for local schools.

A student designed a Texas Trust CU Spirit card for Cedar Hill (Texas) Independent School District, one of the participating schools.
That's exactly what residents from Grand Prairie, Mansfield, Cedar Hill, DeSoto and Athens school districts in Texas have been doing for the last few years, and it's raised more than a half-a-million dollars for areas schools so far.

Every time a member of Texas Trust CU, Mansfield, with $824 million in assets, made a purchase with their Spirit debit reward card, the credit union donated 15 cents to one of the schools.

From August 2011, when the credit union kick-started the effort, until March of this year, the program raised $520,213, with more than $25,000 raised every month this year for area schools.  

"Texas Trust continually supports the students and faculty of our schools," said Susan Hull, Grand Prairie independent school district superintendent. "The Spirit card is an easy way for parents, teachers and the community to support the school of their choice without having to do anything other than use a Spirit card to pay for gas, groceries, movies, or anything else they purchase."

Cardholders are able to track online how much money they raise for each of the participating schools.

Each school has had a custom-designed debit card made for it. There are 14 high schools, two administration offices and one education program participating in the program.

In 2013, Cedar Hill High School received over $50,000; Grand Prairie High School took in more than $27,000; and Mansfield High School just over $20,000. Each school in the program receives a check every month based on card usage from the previous month. The schools can use the money however they see fit.

The rewards program is part of Texas Trust's "Spirit in Action" campaign, which awards schools when members open new checking accounts, or take auto loans, personal loans or mortgages.

CUs planting seeds for mergers

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MADISON, Wis. (5/9/14)--Seasons mean change, and for some credit unions, this spring season means a merger with another credit union.
 
  • In California, the boards of South Western FCU, La Habra, with $132 million in assets, and CU of Southern California (CU SoCal), Whittier, with $710 million in assets, approved a merger. Pending approval by regulators and members, the resulting credit union will have about 75,000 members and retain all its branches. CU SoCal President/CEO Dave Gunderson will remain president, while South Western FCU's President/CEO Laura Poore will serve in an advisory role. "In planning for the future, both credit unions realized that a combined organization will bring greater strength and competitive advantages moving forward than either credit union had on its own today," Gunderson said.
     
  • Garden Savings FCU, a $280 million-asset credit union in Parsippany, N.J., and Essex Division Telephone FCU, Maplewood, N.J., announced plans to merge effective May 31 ( The Daily Exchange May 8). The credit unions will continue to operate under the name of Garden Savings and operate full-service branches in six different New Jersey locations. "Our members will be delighted with the added convenience now available to them," said Essex Division President/CEO Frank Maniscalco, while Garden Savings President/CEO Lou Vetere noted the serving the Maplewood area will help expand its overall presence in northern New Jersey.
     
  • According to its CEO, regulatory requirements and the associated costs were "part of the motivation" for the merger between Resources FCU, Richmond, Va., with $17 million in assets, and Petersburg, Pa.-based Peoples Advantage FCU, with $52 million in assets. Patsy Smith, CEO of Resources FCU, said the merger helps the smaller institution better deal with rising regulatory costs ( Richmond BizSense May 8). Smith will stay on as CEO of the combined credit union, which will retain the Peoples Advantage brand. Peoples Advantage's CEO Audrey Bollinger retired April 30.
     
  • On Wednesday, the boards of DuTrac Community CU, Dubuque, Iowa, with $571 million in assets, and School District 40 Employees CU, Moline, Ill., announced plans to merge ( Telegraph Herald May 8). After regulator and member approval, the combined entity will continue to be called DuTrac Community CU with Andrew Hawkinson as president/CEO. The merger "has tremendous potential to bring our members much more through the combined deposit and capital base and economies of scale available through a larger organization," said Mike Daly, board chair for $15 million-asset School District 40.
     
  • The members of Grove Community FCU, Greencastle, Pa., voted Saturday in favor of the approved merger with $1.03 billion-asset Corning (N.Y.) FCU. Ninety-six percent of the members in attendance voted in favor of the merger, set to occur this summer ( Chambersburg Public Opinion May 6). All Grove Community employees will join Corning, which is the remaining entity, and its current branch will remain open.

Conn. scores victory for sales tax, state-chartered CUs

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MERIDEN, Conn. (5/9/14)--In the final minutes of the state legislative session Wednesday, Connecticut credit unions secured the passage of a sales-and-use tax exemption for state chartered credit unions.

The exemption was passed by the Legislature as a part of the Gov. Dannel P. Malloy's budget implementer bill. The provision was passed with an effective date of July 1, 2016.

"This is a significant victory for state-chartered credit unions, and frankly, for our federally chartered credit unions as well," Jill Nowacki, Credit Union League of Connecticut president/CEO, told News Now . "The sales tax has been a deterrent for Connecticut credit unions in pursuing a state charter, and this provides parity between the state and federal charters."

Nowacki praised credit union advocates throughout the state for their grassroots efforts in supporting the exemption measure and offered "tremendous kudos" to Kelly Fuhlbrigge, league vice president of government relations.

The measure was initially proposed as a standalone bill. Nowacki said the league worked closely with the state Department of Banking and the governor's office to secure the exemption as part of the budget bill.

"Connecticut credit unions will now be able to choose the charter that makes the most sense for their members without a disincentive," said Howard Pitkin, Connecticut Department of Banking commissioner.

League neutral on Colo.'s 'cannabis credit co-ops'

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DENVER (5/9/14)--The Mountain West Credit Union Association (MWCUA) has taken a neutral position on the Colorado General Assembly's vote Wednesday to create the first state-run financial cooperative for marijuana retail businesses in the U.S.
 
The co-ops are designed to provide newly legalized cannabis sellers access to key banking services through the U.S. Federal Reserve. (See related story: Wash. CU sets standards for serving marijuana businesses.)
 
The so-called "cannabis credit co-ops" would allow licensed marijuana businesses to pool resources, have checking accounts and take out loans. The co-ops would be able to make investments on behalf of their members in municipal bonds and certain other securities.
 
The league's primary concern was that a clear distinction exist between credit unions and the cannabis credit co-ops because the marijuana co-ops are not federally insured, said Austin DeBay, MWCUA vice president of legislative affairs.
 
"We wanted a clear distinction that there is a difference between what this co-op attempts to do and what a credit union does because credit unions are insured by the National Credit Union Administration," DeBay told News Now . "We want it perfectly clear that the co-op has a limited scope of business."
 
Lawmakers from both parties supported the bill which  Gov. John Hickenlooper, a Democrat, is expected to sign into law.

The legislation will only go into effect if the U.S. Federal Reserve allows access to its services. "Whether or not that is going to happen still remains to be seen," DeBay said. 'It's an attempt at a state solution, but whether or not it is going to work is uncertain because they still need access to the Federal Reserve."

Filene's new projects tackle credit, member service

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MADISON, Wis. (5/9/14)--The Filene Research Institute unveiled eight new types of financial innovations at its spring i3 meeting in Montreal, Canada.

The institute hopes the new innovations will address issues for credit unions such as connecting with young adults, access to credit, auto lending, switching financial institutions, and knowledge management and collaboration.

More than 50 participants from consumer finance backgrounds attended the i3 meeting, which was hosted by Filene and Desjardins Group. Teams at the meeting presented products, services and business models they had developed, then tested them further throughout the U.S. and Canada, eventually producing the final financial innovations. 

These meetings have produced products in the past such as prize-linked savings accounts, Debt in Focus, and The Savings Revolution.

The new innovations include:
  • CUCrowdSpeak--offers independent vendor reviews by the credit union crowd without the influence of advertising or endorsements;
     
  • DreamRide--puts car ownership information at consumers' fingertips with an easy-to-use app that connects consumers with their "dream cars," in addition to credit union financing;
     
  • Employees' First--improves sales and service by giving member-facing credit union employees access to the collective knowledge of other credit union employees;
     
  • The Independence Card--helps young adults establish credit with a starter credit card product that rewards them for positive behaviors;
     
  • Members Market--matches individual consumers with coupons and offers from small businesses that also belong to the credit union;
     
  • MyDime--allows consumers to design a loan with terms that fit their specific needs, while also connecting them with local credit unions;
     
  • StatusTrack--connects credit union members and employees to real-time system status updates, increasing consumer satisfaction and reducing call center volumes; and
     
  • Switch Ninja--removes the complexity of switching to a credit union by automating the transfer of information and communicating with consumers throughout the process.

ACUC adds social media maven MacArthur to lineup

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MADISON, Wis. (5/9/14)--The Credit Union National Association announced Thursday that it has added Amber MacArthur, a digital marketing expert, to the lineup of keynote speakers that will headline CUNA's 2014 America's Credit Union Conference later this year.

MacArthur, or Amber Mac, is the president and co-founder of Konnekt Digital Engagement and author of the book "Power Friending: Demystifying Social Media to Grow Your Business."

ACUC will be held from June 29 to July 3 in San Francisco.

"Amber Mac's success in reaching today's audiences will give attendees insights on how to optimize their member and social media efforts," said Todd Spiczenski, senior vice president of CUNA Association services. "We are thrilled to have her join Simon Sinek, author of "Why Leaders Eat Last;" Marcus Luttrell, decorated Navy SEAL and author of "Lone Survivor;" and Steve Farber, founder of The Extreme Leadership Institute."

In addition to running her agency, MacArthur co-hosts the CTV program "App Central," which features the latest developments in mobile technology.

She also has worked for Microsoft and for various television and online projects, and at one point emerged as the first major "new media" reporter in Canada.

For more information about ACUC speakers and sessions, or to register, use the resource link.

Wash. CU sets standards for serving marijuana businesses

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SPOKANE, Wash. (5/9/14)--A Spokane Valley, Wash.-based credit union has emerged as the first financial institution in the U.S. to welcome businesses from the marijuana industry to open accounts at their branches--a move meant to bolster public safety.

While retailers, or the dispensaries that sell marijuana directly to consumers, aren't eligible, businesses that grow or process pot can manage their finances at Numerica CU, with $1.3 billion in assets, as of last week.

Recreational marijuana was approved by voters in Washington in November 2012. Marijuana also became legal in Colorado on Jan. 1 of this year. (See related story: League neutral on Colo.'s 'cannabis credit co-ops.')

"These businesses are cash-run, which is not good for a community," Kelli Hawkins, Numerica communications manager, told News Now. "It invites crime, and so we think it's the right thing to do. It's in the best interest of our members and our communities."

Numerica leaders said earlier this year that they were preparing to allow all marijuana businesses, including retailers, to bank at their branches. However, guidelines publicized by the U.S. Justice Department have kept them from moving forward with that plan.

The guidelines place massive regulatory burdens on financial institutions that elect to accept deposits from pot-retailers, such as requiring the institutions to monitor the retail stores so that marijuana isn't transferred to states where it's still illegal.

In a May 7 article in The Spokesman- Review, Numerica representatives said they felt they could not fully control such circumstances in order to comply with the federal guidelines.

The processors and growers that can open accounts at Numerica, meanwhile, still face fairly strict rules:
  • Each marijuana business bank account will be limited to $5 million in total deposits;
     
  • No debit or credit cards can be issued for the accounts;
     
  • All deposits must be made in person, with no night deposits permitted; and
     
  • Account holders won't be allowed to conduct shared-network banking, a unique service of the credit union industry where members can access their accounts at other credit unions in a shared-branch system, among other restrictions.
A spokesperson for the Northwest Credit Union Association (NWCUA), which represents Washington-based credit unions, told News Now the association supports Numerica's decision, and that it appears to be a "well-thought-out policy decision" based on what federal guidance allows the institution to do.

Lynn Heider, NWCUA vice president of public relations, said the association would still like to see clearer direction from Congress about the role of financial institutions in this industry.

"We would like to see an act of Congress to put more structure and definition around how financial institutions can bank these legal businesses," Heider said Thursday.  

"For credit unions, there is too much of a gray area."

Numerica worked extensively with representatives of the state and federal liquor control boards to learn about the industry and craft the appropriate, and legal, menu of services.

Businesses who qualify only will be able to deposit funds, view their accounts online, write checks, send wire transfers and use automated clearing house services.

To qualify for Numerica's services, a business must have received a license to operate from the state of Washington, from the municipality where they run their business, and they must reside in a city where the credit union operates one of its 17 branches.

Hawkins told News Now that only two businesses who have applied have qualified so far, but neither have finished applications to open accounts.

CUs stand watch as legislative sessions wind down

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MADISON, Wis. (5/8/14)--From patent "trolls" to financial literacy to legalized marijuana sales, state legislatures addressed key issues affecting credit unions during recent sessions that are winding down.
 
Colorado ended its session last night by sending a bill to Gov. John Hickenlooper's desk that would create uninsured financial cooperatives for marijuana businesses. Of HB 1398, Andrew Freedman, the governor's director of marijuana coordination, said, "This gives us an avenue to go to the Federal Reserve, and get cash off the street. That was by far our No. 1 priority" ( Denver Post May 7).
 
Because of strict regulations--and the fact marijuana is illegal under federal law--legitimate sellers in Colorado and Washington have been running their businesses on a cash-only basis. Both states consider safety a main reason to allow financial institutions to serve the marijuana industry.
 
In Missouri, the House voted in favor of SB 706, a bill that sets clear criteria to help distinguish legitimate patent infringement from patent "trolls" that send frivolous demand letters. Passed by the Senate in April, SB 706 now heads to Gov. Jay Nixon's desk. (See News Now May 1: Session end in sight, Mo. patent 'troll' bills keep moving.)
 
"We know several credit unions in Missouri were affected by patent trolling," said David Kent, director of state legislative affairs, Missouri Credit Union Association ( Missouri Difference May 6). "They had little to no protection against the allegation, forcing them to decide either to spend thousands of dollars in court or on a settlement--which, unfortunately, is what many small businesses end up doing. SB 706 flips the scenario, creating parameters that a patent infringement assertion must contain to be considered valid."
 
The Credit Union National Association supports the demand-letter language within Sen. Patrick Leahy's (D-Vt.) Patent Transparency and Improvements Act of 2013, which would aid credit unions and other businesses that have been targeted with financial threats through demand letters by bad actors who have been come to be referred to as patent "trolls."
 
In Florida, of the 1,812 bills filed by the legislature, only 258 are headed to the governor's desk. One of those bills, SB 1012, updates state statutes regarding credit unions including the authority of the Office of Financial Regulation ( eNews May 6). The legislature also took up a data security bill after the Target breach in December, which is also headed to Gov. Rick Scott's desk.
 
Although they did not pass, bills on financial literacy requirements for high school student "gained an awful lot of traction," according to the League of Southeastern Credit Unions, in part because of credit unions' work with the bills' sponsors.

Message matters when marketing to moms

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MADISON, Wis. (5/8/14)--The flowers. Breakfast in bed. These heartfelt images swirl around consumers with Mother's Day right around the corner. Credit unions, though, can benefit from focusing on moms throughout the year.
 
Verity CU and Fort Worth Community CU have distinguished themselves as two credit unions that market specifically to women. Marketers from both credit unions primarily attribute their individual decisions to focus on women to a simple concept: market segmentation.
 
Verity CU developed its Verity Mom marketing strategy in 2008 after the credit union's leadership team read and discussed the popular business book, "Blue Ocean Strategy" by W. Chan Kim and Renee Mauborgne. Kim and Mauborgne show that companies can succeed not by battling competitors, but rather by creating "blue oceans" of uncontested market space.
 
Click to view larger image Verity CU gives Seattle-area mothers a voice with its Verity Mom program, which was launched in 2009.
"We decided that we needed to focus on a segment, and be everything to that segment instead of being all things to all people," Shari Storm, a former senior vice president at the $422 million-asset credit union based in Seattle, told News Now . "As credit unions we hate to leave anyone out. We want to open our arms and welcome everybody."
 
In the financial services marketing arena, that uncontested space was women, or more specifically, moms. And moms were "sticky" targets, according to Storm, who convinced the credit union's board and management that targeting mothers made business sense.
 
Storms, a mother herself, cited three reasons why moms are a desirable target market:
  • They control 85% of household spending decisions, according to research and statistics from the Credit Union National Association;
     
  • They are the No. 1 influence on where their kids do their banking; and
     
  • They influence each other.
To the last point, Storm challenges skeptics to Google the name of any mid-sized or larger city followed by the word "moms" and look at the results. "Moms congregate online, which is really something to take note of," she told News Now .
 
Launched in 2009, Verity Mom not only targets Seattle-area mothers but gives them a voice. Every two years the credit union holds a social media campaign to choose a Verity Mom, who blogs, connects with Verity CU members through social media, and represents the credit union at public events.

The Verity Mom contest was developed by Currency Marketing and is similar to the Vancouver, B.C.-based marketing firm's Young and Free brand. Contestants vie for the Verity Mom title, staging social media-driven campaigns that include a sample blog and a one-minute YouTube video.

Verity changed the name of its checking account to the whimsical and mom-friendly "Cartwheel Checking" and rolled out remote deposit. Branches were redesigned with kid-friendly play areas and changing tables in both men's and women's bathrooms.
 
"We've even made an effort to hire moms for part-time jobs so they can provide for their families," Melina Young, Verity CU's director of marketing, told News Now . "I've always said that this helps us walk the walk instead of just talking the talk about being a financial institution for families. We really are dedicated to this concept."
 
That dedication has helped the credit union lower the average age of its new members by three years. Forty percent of new members in 2012 were between the ages of 18 and 34, Storm said. Only 25% of closed accounts were in the 18 to 34 age set.
 
Click to view larger image The Gabby communications team at Fort Worth Community CU, Bedford, Texas, uses social media to interact with the credit union's target audience.
Recognizing the influential role women play in household financial decisions, Fort Worth Community CU, with $819 million in assets, Bedford, Texas, also wanted to connect to local women in a targeted, meaningful way.
 
"The reason was not to be all things to all people, but to really focus on women and buying and saving," Rochelle Drake, the credit union's vice president of marketing, told News Now . "We defined an age group (28 to 55 years old), and we defined women as our focus."
 
Why women? "All of the statistics we looked at told us that women indicated that women were the primary person in the family that handled finances in the home," Brandy Scarlett, Fort Worth Community CU marketing assistant, told News Now . "When it came to deciding which financial institution you were going to use, more than likely it was going to be a woman who was going influence that decision."
 
The credit union also sought to increase its use of social media with the goal of growing membership and increasing product awareness. "The point was not to make social media a broad audience but to create a girlfriend-type of spokesperson who connects with other girlfriends," Drake said. "As consumers, when women want a pair of shoes, or go to new salon, or open a new checking account, they want to talk to other women."
 
To ensure employees understood and embraced the initiative, Fort Worth Community CU marketers and its marketing firm Third Degree "introduced" Gabby to employees before her public debut. Staff received branded items and a training guide.

The external launch included social media platforms, billboards, drive-thru banners, boards behind the teller counters, an on-hold message and lobby displays. An initial external push also included direct mailers, HTML emails, and online advertisements with Google, Facebook and a local newspaper.

A team of 10 employees--nine women and one man--from Fort Worth Community CU serves as the Gabby communication team. Members blog and post to Twitter and Facebook based on their personal experiences.
 
"It's really increased our interaction with members and helped us energize social media," Drake said. "There's a group who communicate with us almost every day."

If targeted marketing connects with women, why don't more credit unions try it? "Because credit unions have been taught that one member is as good as another member, so everyone was treated equally," Drake said. "For so long there wasn't segmented marketing. As credit unions moved to community charters, we've started to break our memberships into demographic groups."
 
And Storm dismisses the notion that marketing to women will leave male members feeling alienated. She tells the story about one Verity Mom promotion that featured garden gnomes in branches. "Women were walking in telling us, 'I love the garden gnomes. Can we have them when you're done with them?' The men? They didn't even notice them."

Ill. CUs pay tribute to retiring league CEO

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NAPERVILLE, Ill. (5/8/14)--The Illinois Credit Union League and credit unions from around the state are feting league president/CEO Dan Plauda before his June retirement this year.
 
Dan Plauda, president/CEO, Illinois Credit Union League, is inducted into the Illinois Credit Union Hall of Fame by outgoing league Chair Geri Burek, CEO, South Division CU, Evergreen Park. (Illinois Credit Union League photo)
Plauda's career in the credit union movement began 37 years ago when he joined the league as general counsel. In 1984, he became president of the league, succeeding then-president Dick Ensweiler, now president/CEO of the Cornerstone Credit Union League.
 
For his accomplishments in establishing the Illinois Credit Union Foundation (ICUF), initiating the league's major conferences and overseeing the recodification of the Illinois Credit Union Act, Plauda was inducted into the Illinois Credit Union Hall of Fame, and a second ICUF Perpetual Tribute Award was established in his name. More than $16,000 has been donated to the Daniel D. Plauda Perpetual Tribute Award.
 
"Dan is a real life example of someone who has given his all, and by doing so, has achieved what he sought--a positive future for the credit unions of Illinois," said outgoing league Chair Geri Burek, CEO, South Division CU, Evergreen Park.
 
Also paying tribute to Plauda at the league's annual convention were Credit Union National Association President/CEO Bill Cheney, who presented a framed resolution on behalf of the CUNA board of directors, and Plauda's predecessor Ensweiler.
 
Plauda's successor, Sean Hession, began his tenure at the league May 1. Plauda will help the transition process until his June retirement.

Payments Roundtable homework: Look at ACH data

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LAS VEGAS (5/8/14)--Suzanne Savage of Savage Consulting helped Credit Union National Association Payments Roundtable participants boil down two days of intensive sessions that covered a range of issues that included topics ranging from digital currency to payment systems abroad to digital wallets.
 
Suzanne Savage, of the Savage Consulting Group, spoke Tuesday at the Credit Union National Association Payments Roundtable. "You will need a loyalty program as part of your member-retention strategy," she said. "We're all conditioned to be rewarded for our patronage." (CUNA photo)
Savage also provided attendees with direction in starting their payment strategies when they return to their credit unions.
 
Payments innovation is largely being driven by non-financial institution players, Savage said.  "Google, PayPal and others are disintermediating our members in favor of these non-FI driven programs," she said. "And this is not driven to get your payment transactions. These guys want to sell stuff. Amazon wants to sell stuff. PayPal wants to facilitate selling stuff. They want to promote loyalty."
 
Also, card-based revenue-generated transactions are being threatened by programs such as Target's Red Card and PayPal. Savage advised credit unions to work with their transaction processing partners to determine if their transactions are dropping and work with their providers to migrate transactions back to cards.
 
"If I give you one homework assignment, it's to go back and look at your ACH data," Savage said. She noted that credit unions have "crazy good" data on ACH reports. For instance, she told of working with one credit union that found its top ACH transactions were going to Chase, Capital One and American Express. "Now they knew which members they could target for credit card accounts," Savage said. "The already had their DDA accounts."
 
Credit unions must develop a bottom-up payments strategy that begins with accounts and cards that are desired by members. This means accounts that provide surcharge-free ATM access, ease of use and mobile device access.
 
The next level of strategy is technical competence.  Websites, call centers and mobile applications must be easy to use. "In terms of interface ease of use, your credit union is competing with Apple and Amazon," Savage said.
 
Credit unions must work to build loyalty the way Amazon and Apple have done, Savage said. The best way for credit unions to be relevant in the digital wallet space to today is to offer accounts and cards desired by members.
 
"You want your cards to be in the wallets that don't belong to you," Savage said. "The best way to do that is by providing accounts and cards that members want and building loyalty."
 
For credit unions, a payments strategy boils down to relationships, Savage said. This includes member service, personalization and, again, offering products that members want, such as remote deposit and personal financial management tools.
 
Even as the payments landscape changes, building loyalty and retaining members remains more important than ever. "It will always be cheaper to keep members than to acquire new ones," Savage said.

CUNA HR/TD Council taps exec committee

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MADISON, Wis. (5/8/14)--The CUNA HR/TD Council announced its executive committee and officers during its recent annual conference in Fort Lauderdale, Fla.
 
Executive officers are:
  • Chair: Robert Davis, senior vice president of human resources, VyStar CU, Jacksonville, Fla., with $4.9 billion in assets;
  • Vice chair: Cindy Swigert, chief human resources officer, United FCU, St. Joseph, Mich. with $1.6 billion in assets; and
  • Second vice chair: Lisa Baron, senior vice president of human resources and talent management, Baxter CU, Vernon Hills, Ill., with $1.8 billion in assets.
New members of the executive committee are:
  • Buddy Bennett, manager of human resources and training, Cyprus FCU, West Jordan, Utah, with $630 million in assets;
  • Mark Millwood, director of human resources, Eastman CU, Kingsport, Tenn., with $2.8 billion in assets; and
  • Nora Swart, senior vice president of talent, Lake Michigan CU, Grand Rapids, Mich., with $3 billion in assets.
Other members of the CUNA HR/TD Council executive committee are:
  • Robert Carmichael, senior vice president of human resources and training and development, Maine Savings FCU, Hampden, Maine, with $265 million in assets;
  • Jennifer Huggard, assistant vice president of talent, Northwest Credit Union Association, Federal Way, Wash.;
  • Suzanne Oliver, senior vice president of educational services and governmental affairs, Mountain America FCU, West Jordan, Utah, with $3.6 billion in assets; and
  • Linda Steger, vice president of human resources for NRL FCU, Alexandria, Va., with $447 million in assets.

Calif. economist advises CUs to 'dig deep' to build loan-to-share

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ONTARIO, Calif. (5/8/14)--Despite improvements to the economy, loan-to-share ratios have remained weak at California and Nevada based credit unions, prompting one credit union leader to implore member-owned institutions to step up their marketing efforts moving forward.

Dwight Johnston, chief economist for the California and Nevada Credit Union Leagues, reports that both California and Nevada have fallen behind the rest of the country in loan-to-share ratios and membership growth ( In the News May 7).

"We don't have first-quarter numbers yet, but we're hearing from most credit unions the first quarter was a bit on the slow side," Johnston said.

California and Nevada credit unions have seen some improvements of late, especially in California where membership growth climbed 1.3% last year, grabbing hold of 25% of the state's population.

That mark falls well short of the national rate of membership growth last year of 3.4%.

While the answer to this growth problem could be different for all credit unions, to help member-owned institutions in both states catch up to their national counterparts, Johnston offers a variety of measures to take.

First, credit union leadership should identify the job sectors in which the majority of their members work, whether that be construction, manufacturing, education, and so on.

"Pay particular attention to the gains since the recession lows," Johnston said. "Some of the sectors are growing strongly, and the outlook for future gains in business/professional and health care are especially bright."

Johnston also recommends that credit unions focus on job sectors within close proximity to their branches. With a bit of research, perhaps through the U.S. Bureau of Labor Statistics' website, credit unions can identify where there are gains to be had.

Lastly, Johnston suggests implementing a target marketing campaign.

"For those who don't have the resources, there are organizations that can work with you to develop strategies and materials to accomplish this," Johnston said.

"The message is clear," Johnston added. "California and Nevada credit unions are lagging. Given the bright prospects ahead, there is no reason this should become a permanent conditions. It's time to dig deep."

CUNA institute powered by extreme leadership

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MADISON, Wis. (5/7/14)--The Credit Union National Association Leadership Institute will be held Dec. 7-12 in San Diego, organizers announced Tuesday.

"Building on a successful launch last year, we are excited to bring cutting-edge leadership development to credit union executives," said Marlo Foltz, CUNA vice president of blended learning. "We weave together Steve Farber's nationally acclaimed Extreme Leadership program with credit union-specific scenario planning empowering participants to drive success at their credit unions."

The institute will feature a two-day workshop presented by Farber, author of the book "The Radical Leap" and founder of the Extreme Leadership Institute. Farber also will be a keynote speaker at CUNA's America's Credit Union Conference, held June 30 to July 3 in San Francisco.

News Now will preview ACUC with an exclusive interview with Farber later this week.

CUNA's Leadership Institute will introduce participants to various innovative and entrepreneurial approaches to leadership development at credit unions.

Attendees will be challenged to "rethink what it takes to oversee an organization while discovering inspiration for their personal leadership styles."

Other sessions include:
  • Calculated strategic decision-making;
     
  • Disruptive thinking and innovation;
     
  • Scenario planning and management team preparedness;
     
  • Attracting, harnessing and developing a talented staff; and
     
  • Individual leadership style assessment.
 
Registration for the event, in its second year running, and additional school details can be found at http://events.cuna.org/cli14.

CU System briefs (05/07/2014)

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  • SEATAC, Wash. (5/7/14)--The Northwest Credit Union Association (NWCUA) announced the hiring of Jamie Dedmon as the community manager for its communications team (Anthem May 6). She will be responsible for NWCUA's professional networking councils, the Credit Unions for Kids program and outreach strategies for credit union chapters and small credit unions. She previously worked for Spokane Teachers CU, Liberty Lake, Wash., and was a board member for the Spokane Chapter of Credit Unions. She can be reached at jdedmon@nwcua.org and (206) 340-4814 ...
  • NAPERVILLE, Ill. (5/7/14)--Jack Teausant, CEO, Financial Plus CU, Ottawa, Ill., with $219 million in assets, was honored with House Resolution 776 on the Illinois State House floor for his 38 years in the credit union movement. State Rep. Frank Mautino (D-Spring Valley), left, presented the resolution to Teausant during the Illinois Credit Union League's (ICUL) annual legislative day. Teausant followed in the credit union footsteps of his grandfather Charles Munks, who organized Glass Workers CU (now Financial Plus) in 1951, and his mother, Marilyn Dudgeon, who was the credit union's first full-time employee. Teausant was promoted to president in 1979. The resolution stated, "Jack Teausant has ensured that all people have a credit union where they feel respected, valued and able to conduct their financial business with trust."  His work includes the board of the Tri-County Chapter of Credit Unions, the Credit Union Political Action Committee and ICUL. He was inducted into the Illinois Credit Union Hall of Fame in 2012 ...
  • FARMERS BRANCH, Texas (5/7/14)--James L. "Jim" Bryan, retired president/CEO, Texans CU, Richardson, Texas, died May 1. He was 75. Bryan served as president/CEO of the $1.4 billion-asset credit union for more than three decades (Leaguer May 6). He was inducted to the Cornerstone Credit Union League's Credit Union Hall of Fame in 2004. His contributions include involvement in the Dallas Chapter of Credit Unions, Town North Bank, Catalyst FCU, the Credit Union National Association, Filene Research Institute, CUNA Mutual Group and the Cornerstone league ...
 

Mobile payments interest higher than activity

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LAS VEGAS (5/7/14)--"There is high interest in mobile payments right now, but low activity," Jason Oxman, CEO of Electronics Transactions Association, told attendees at the Credit Union National Association Payments Roundtable Monday in Las Vegas.
 
Consumers love shopping electronically, and they love their smartphones, but the two interests have not converged into acceptance of mobile payments, Jason Oxman, CEO of Electronics Transactions Association, told the Credit Union National Association Payments Roundtable Monday in Las Vegas. (CUNA photo)
"About 70% of U.S. gross domestic product is attributed to consumer spending," Oxman said. "And 70% of consumer spending is being done electronically. There are one billion plastic cards in circulation in the U.S. today. Clearly, consumers love electronic payments. They also love mobile phones. There are 325 million mobile phone subscriptions in the U.S. and about 65% of those mobile phones are smartphones."
 
Oxman said, "If consumers love electronic payments, and if consumers love mobile phones, the logical conclusion is that there's high potential for acceptance of mobile payments."
 
That acceptance might not take place a quickly as some people think, he noted. About 90% of retail sales are at brick-and-mortar stores with 10% of retail sales online.
 
Consumer and retail acceptance of mobile payments will take some time, Oxman said. Acceptance of mobile payments has been growing at about 120% annually for the past five years, but it's still relatively low.
 
"Consumers need to be given an incentive to use mobile payments," Oxman said. "Surveys have shown that consumers actually think their credit and debit cards are more secure than their smartphones. It's not true, but that's what they think."
 
Incentives or rewards carry more sway than security when it comes to consumer adoption of mobile payments.
 
Frontrunners in mobile payment technology include Bluetooth low energy; near-field communication (NFC); or Europay-MasterCard-Visa (EMV) technology.
 
"It's estimated that one-third of all smartphones will be NFC-enabled by 2015," said Oxman. "The big question is whether or not the new iPhone will be NFC-enabled."

Kirsch: Bitcoin moving toward regulation

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LAS VEGAS (5/7/14)--Bitcoin investor Steve Kirsch compared the state of digital currency--and Bitcoin specifically--to the dawn of the Internet during a Credit Union National Association Payments Roundtable presentation Tuesday in Las Vegas.
 
Kirsch, the principal of Cointrust, a company that claims to take "high road" in digital currency compliance, said the Bitcoin technology could have other uses besides currency, including "anything that is tradable, such as cell phone minutes."
 
He added that Bitcoin is adding as many as 500 merchants a day, despite concerns from regulators.
 
"The reality is that it is gaining momentum, but that momentum, as the regulators gain clarity, could mean we shift to a more regulated version of bitcoin," Kirsch said. "The concept of digital currency I don't think is ever going away--it's just going to change in terms of how we think of it in being compliant with laws instead of being out there in the Wild, Wild West."
 
In contrast to conventional currency networks, the Bitcoin network is decentralized. The network processes bitcoin transactions on a peer-to-peer basis rather than through a centralized processing system. The Bitcoin network has its own unit of value, which is called the bitcoin.
 
Kirsch explained that Bitcoin with a capital "B" means the software and the system; bitcoin with a lowercase "b" means the currency.
 
Bitcoins are mathematically generated as the computers, a procedure known as Bitcoin "mining."
 
The market for bitcoins is volatile, in part because the crypto-currency is not backed by any assets and is unregulated.
 
Recently, some credit union state regulators have warned credit unions not to deal in the bitcoin currency.
 
Kirsch acknowledged there are concerns with bitcoin currency and the Bitcoin network, primarily concerning safety, security and compliance. But he said reputable companies are working to address these concerns to work with regulators and financial institutions and advance the technology. 
 
Kirsch compared the Bitcoin networks current status to the early days of the Internet. "When the Internet was created it didn't take off until somebody came up with the idea of the World Wide Web," he said. "Right now the Bitcoin is this enabling technology, and there are going to be some interesting applications. There are lot economists and experts who say it is going to fail, but they fail to account for the innovation that is going to happen."

Consumers of all ages more concerned about online data protection

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MADISON, Wis. (5/7/14)--While U.S. Internet users are becoming increasingly more concerned with the safety of their personal data, many still aren't taking action when a legitimate threat presents itself, new research has found.

Click to view larger image Click for larger view
A recent study conducted by GfK, a market research agency, revealed that 60% of Internet users are more concerned about their data than they were last year, with higher levels of concern reported by all age demographics (eMarketer May 6).

The Temkin Group, a customer experience consulting firm, also reported Monday a significant jump in the number of consumers who worry about the security of their personal information: an increase up to 74.8% in the first quarter of 2014 from 68.7% in the last quarter of 2013.

The Credit Union National Association continues to urge federal lawmakers to address data security relative to merchants, who aren't required to meet the same security standards as those of credit unions and other financial institutions.
 
CUNA leaders maintain that all payments system participants must be held to comparable levels of federal data security requirements.

Despite these concerns, the research uncovered that consumers often fail to take steps to safeguard sensitive personal information when an actual threat materializes.  

After March's Heartbleed incident, which may have exposed personal information stored on more than 500,000 websites, less than 40% of those who knew about the problem had moved to protect their online information, according to a study by Princeton Data Source. Less than three of 10 respondents reported being concerned about their personal information at all following the issue.

Research has found that in general only 39% of U.S. Internet users change their computer passwords regularly. 

Meanwhile, more than three-quarters of Internet users at least "somewhat agreed" they'd stop using a service, product or retailer if they believed their privacy had been violated, according to a poll conducted by Radius Global Market, reported by eMarketer.

Nearly 80% of Internet users said they only purchased goods or services from companies they trusted, and more than two-thirds said they only did business with companies they felt could properly handle their personal data.

Further, companies who can assuage consumers' data security concerns may in fact attract more business, the study found, as the majority of respondents said they would pay higher prices if they believed the company valued the privacy of their information.

Values, community built into Vancity payments strategy

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LAS VEGAS (5/7/14)--Financial literacy and building a healthy community are values supported by the products, services and strategies offered by Vancity CU, Vancouver, Canada, said its vice president of payment solutions.
 
Vancity CU's payments products and services reflect the Vancouver, Canada, credit union's values of promoting financial literacy and building healthy communities, Vice President of Payment Solutions Mohamed Ladak told the Credit Union National Association Payments Roundtable in Las Vegas Tuesday. (CUNA photo)
The $17.5 billion-asset credit union's credit card program focuses on members' needs, Mohamed Ladak told attendees at the Credit Union National Association Payments Roundtable in Las Vegas Tuesday.
 
Vancity's enviroVisa credit card has an 86% approval rate, and it can be customized for high-risk members so those members also have access to credit. The card program uses a "wallet" approach to enable access to multiple payment types that address members' needs and preferences.
 
Each year, Vancity takes 5% of the profits from its enviroVisa card program and places it in the credit union's enviroFund. Those funds are then invested in environment-enhancing initiatives, such as sustainable urban food production and farmers' markets.
 
The card is coupled with a rewards program, and about 70% of rewards points go to members' savings or loan accounts. Only about 25% of rewards points are redeemed for travel bonuses and 5% are redeemed for merchandise.
 
Vancity believes in ongoing member education and awareness. The credit union contributes $1 million annually to its credit card financial literacy initiative. It has produced two YouTube videos to help members understand the benefits of paying off their card balances quickly. "By posting these two videos, we actually make less money, but the videos are consistent with our values, and our values are our differentiator," said Ladak. The credit union's vision statement is, "We make good money by putting money to good."
 
Ladak said that tap-and-go technology is very popular in Canada right now, so Vancity is incorporating that technology into its payments systems. "We're taking a wait-and-see approach to a mobile wallet until a dominant technology solution emerges and we know exactly what our members want.
 
"A payments strategy is not one solution but many incremental steps," he noted.

Today is Wis. CU league day, proclaims Milwaukee mayor

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PEWAUKEE, Wis. (5/7/14)--As the Wisconsin Credit Union League gears up for its annual convention in Milwaukee, the city's mayor is giving special recognition to the group for its 80th anniversary.
 
Milwaukee Mayor Tom Barrett issued a proclamation that today is Wisconsin Credit Union League Day (The League News May 5).
 
The City of Milwaukee proclamation cites:
  • The league's service to 177 member-owned financial cooperatives;
     
  • The dedication of these institutions to improving the financial position of Wisconsin citizens by helping them make ends meet, weather job losses, and save for education or retirement;
     
  • The more than $2.7 billion in small business loans made to strengthen Milwaukee's and Wisconsin's economy;
     
  • The support provided to 3,000 charities and local causes; and
     
  • Eighty years of service and leadership to the community.
The league's convention begins today in Milwaukee and runs through Saturday. Barrett is scheduled to be at the annual meeting Thursday.
 
In addition to the week's keynote speakers and networking sessions, on Saturday the league will hold a day of service. Volunteers will assemble financial literacy kits, make bag lunches and assemble toiletry kits, among other volunteer activities, for charities in the greater Milwaukee area.

CU gets minor league team off the bench, onto the field

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KALAMAZOO, Mich. (5/7/14)--A credit union has helped build it, and now baseball will come to Kalamazoo, Mich.

Consumers CU, Kalamazoo, Mich., with $501 million in assets, announced a partnership Monday with the Kalamazoo Growlers, a new minor league baseball team, to help "bring baseball back" to town.

As a founding partner of the club--and as the official financial institution for the Growlers--Consumers CU will sponsor events at the ballpark throughout the season, such as Super Saturdays, Scout Night and "Star Wars" Night when the team will give out light sabers to the first 500 kids in attendance.   

"The Growlers are excited for Consumers CU to join the family this season and beyond," said John Bollinger, assistant general manager of the team.  

Members of Consumers CU will benefit from the partnership as well. In addition to access to concession, merchandise and ticket discounts for future games on Saturdays, members also will be able to enter to throw the first pitch at Super Saturday games.

Young members of the credit union, meanwhile, will be invited to a special Kids Day at the Park where they can participate in hitting, fielding and throwing drills.

"We look forward to bringing the community together around this great summer pastime and offering added benefits to our members," said Lynne Jarman-Johnson, Consumers CU chief marketing officer.

Consumers CU also is the official sponsor of both the "Growlers Cub Club" and the bat boy/girl who will hand out tickets, prizes and offer special opportunities to young Growlers fans.

Young professional at N.Y. GAC says be your members' voice

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ALBANY, N.Y. (5/7/14)--Legislative issues were top of mind when credit union advocates attended the Credit Union Association of New York's (CUANY) Governmental Affairs Conference, but Corning (N.Y.) FCU's Stephanie Carl had another bit of advice: Tell your credit union's story.
 
Carl, who is manager of marketing and communications at the $1.03 billion-asset credit union, said she talked with a novice GAC attendee "who was getting caught up in learning all of the information about the numerous bills and issues," Carl said in a May 2 column in The Point.
 
"Her role was to be the voice of her members," she advised.
 
Carl, who serves as communications chair for CUANY's Young Professionals Commission, said the more than 100 meetings with elected officials had one purpose--to advance credit union issues and legislation--but likely no two meetings were the same.
 
"When we go to events like state GAC, we represent our own individual credit unions and our reason for being there is to share our unique stories," Carl said, adding, "As a credit union representative, there's no more amazing experience than sitting across from an elected official and talking about how your credit union has made a difference in a specific member's life."
 

CU System briefs (05/06/2014)

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  • NEW CASTLE, Del. (5/6/14)-­-At the Delaware Credit Union League's 56th annual meeting, board members and the board executive committee were elected. Re-elected to three-year terms were incumbents Jerry King, DEXSTA FCU, Wilmington, with $206 million in assets, and Meredith Jeffries-Snedeker, New Castle County Delaware Employees FCU, with $20 million in assets (Together May 2). Other board members are Sharon Schaeffer, Delaware First FCU, Wilmington, $26 million in assets, and Susan Winward, Wilmington Postal FCU, with $16 million in assets. Board officers are: Chairman Allen Riley, Sussex County FCU, Seaford, with $249 million in assets; Vice Chairman Joel Romaine, Community Powered FCU, Bear; Treasurer Cheryl Chilcutt, Louviers FCU, Newark, with $234 million in assets; and Secretary Jeffries-Snedeker ...
  • MARLBOROUGH, Mass. (5/6/14)--St. Anne's of Fall River (Mass.) CU is distributing a $10,000 grant over two years to the Boys and Girls Club of Fall River (Daily CU Scan May 5). The Keystone Club runs from September to June for about 30 students who exemplify community service, education and career exploration. This the second such donation from the $825 million-asset credit union. Members of the Keystone Club surround Kelly Baldwin, marketing and Community Reinvestment Act officer, and Ross R. Upton, president/CEO (Daily CU Scan photo)  ...
  • CLAREMORE, Okla. (5/6/14)--TTCU The Credit Union, Tulsa, Okla., found a way to put to good use security equipment it no longer needed. The Claremore branch of the $1.4 billion-asset credit union donated it to Foyil Public Schools for use in two new buildings for the agriculture and band programs (Claremore Daily Progress May 4). The equipment came from last year's merger with Miami, Okla.-based NEO CU, which had a branch in Claremore. "This is from that facility," said branch manager Bryan Bradley. "Since it was no longer needed, we looked at what we could do with it ... it made more sense to call around to our local schools to see if any of them could use it." Rod Carter, Foyil school superintendent, said the equipment is interchangeable with what it currently has so it can use it for spare parts ...
  • NEWARK, N.J. (5/6/14)-­-Frank P. Mercuri, former president of Bloomfield (N.J.) Fire and Police FCU,  died May 1. He was 77. Mercuri was a sergeant with the Bloomfield Police Department and led the $6 million-asset credit union for more than 30 years (The Star-Ledger May 4) ...

DE designations earned by 43 at NCUF training

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MADISON, Wis. (5/6/14)--Forty-three credit union professionals became Credit Union Development Educators (CUDEs) last week after completing the spring session of the National Credit Union Foundation's (NCUF) Development Education (DE) training in Madison, Wis.
 
"My head is filled with so much more knowledge, and I feel this fire and encouragement that I can make a difference, even if I am just one person doing something small on my own, said Stacie Neuman, financial architect, Best Advantage CU, Brillion, Wis., with $68 million in assets. "Learning about issues on a global level vs. a local level really opened my eyes."
 
The intense training offers lessons in cooperative principles and credit union philosophy, connecting them to today's challenges for credit unions.
 
This class worked on opening an Islamic banking center; board development and recruitment, including the compensation debate; solutions to payday lending; microfinance to women in the Philippines; developing credit union awareness; and a small credit union merger dilemma.
 
Graduates include representatives from credit unions, corporate credit unions, credit union service organizations, state credit union leagues, CUNA Mutual Group, Filene Research Group, the Credit Union National Association and NCUF. Jamaica and the United Kingdom also were represented in the Class of Spring 2014.
 
Registration is still open for the fall session of DE training, set for Sept. 10-17 in Madison.

Lending jumps, delinquencies drop at Wis. CUs

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MADISON, Wis. (5/6/14)--Credit unions in Wisconsin posted an 8.5% jump in lending and a 6% increase in net income in the first quarter of 2014, according to year-over-year numbers released by the state Department of Financial Institutions (DFI) Monday.

Total loans for the state's 170 state-chartered credit unions reached $18.45 billion, compared with $17 billion in the first quarter last year; while net income surpassed $56.3 billion compared with $53.1 billion in 2013.

"State credit unions had a very solid start to 2014," said DFI Secretary Peter Bildsten. "Year-over-year loan growth of 8.5% shows that Wisconsin credit unions are putting their members' deposits to work."

The delinquent loan ratio at Wisconsin credit unions also showed improvement, dropping to 0.98% in the first quarter from 1.22% last year. Net worth ticked up to 10.51% from 10.14% as well.

A sizeable 12.8% reduction in expenses caused by delinquencies to credit unions in the first quarter was noted by Kim Santos, director of the Office of Credit Unions, in a DFI press release.

"Credit unions' delinquent loan ratio in the first quarter was below 1% for the first time since 2004," Santos said. "That's a very positive sign that bodes well for the state's credit union industry."

The full report on how Wisconsin's credit unions performed in the first quarter this year will be posted on the DFI website, www.wdfi.org, by mid-May.

CUs testify on fin. lit. for Mich. House committee

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LANSING, Mich. (5/6/14)--As part of National Financial Literacy Month, Michigan lawmakers called upon credit union leaders to educate them about programs they can use to improve financial literacy statewide.

Community Financial CU's Natalie McLaughlin, senior education partnership coordinator, left, and Will Lawton, president/CEO, and Michigan Credit Union League Manager of Financial Education Beth Troost meet with Rep. Mike Callton (R-Nashville). (Michigan Credit Union League photo)
Representatives of the Michigan Credit Union League and various credit union professionals recently testified before the House Financial Services Committee to discuss the efforts they've undertaken in educating their members and their communities (Monitor May 5).

Beth Troost, league manager of financial education, first distributed to the House committee the Money Matters Thumball and teaching guide, a tool developed by the league's financial education committee.

Troost then explained to committee members that studies, such as those conducted by the Corporation for Enterprise Development and the Center for Financial Security at the University of Wisconsin-Madison, have demonstrated the importance of financial education in schools.

"The study shows that classroom financial education does work," Troost said.

April Clobes, chief operating officer of the East Lansing, Mich.-based Michigan State University FCU, added that her credit union offers several financial education programs, including one where MSU FCU partners with the city and the school district, called "Lansing Save."

The $2.5 billion-asset credit union also helps young people transition from foster care to adulthood with another financial education program.

"These types of programs really help our youth become successful," Clobes said. "Thank you for your interest in our work."

Natalie McLaughlin, senior education partnership coordinator at Community Financial CU, Plymouth, Mich., with $543 million in assets, said her credit union has organized nearly 40 student-run credit unions in schools, a program the credit union has operated since 1990.

"We have hired some of these kids as they have gotten older," McLaughlin said in Monitor.

The credit union also delivered 754 classroom presentations on financial education, reaching 18,000 students, in 2013.

Ill. league's Senkpeil is CU Magazine Hero of the Year

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MADISON, Wis. (5/6/14)--For her efforts serving small credit unions, readers of Credit Union Magazine have named Joni Senkpeil the 2014 Credit Union Hero of the Year.

Senkpeil, the director of small credit union development for the Illinois Credit Union League (ICUL), will be honored at the Credit Union National Association's America's Credit Union Conference, which runs June 29 to July 3 in San Francisco.

 "I am so honored by this award," Senkpeil said in an ICUL press release. "Without the support of our small credit unions, I'd be without this opportunity. I am so grateful for that."

The award recognizes credit union professionals who go above and beyond to promote the credit union movement and its people-helping-people philosophy, and also those who have made a difference in their communities.

Senkpeil formed the Illinois league's Small Asset Size Credit Union Advisory Group, which strives to foster a stronger small credit union community.

Additionally, Senkpeil spearheaded the regional "lunch and learn" workshop series geared towards small credit unions, while also helping to develop content for the league's Small Credit Union Center website.

Her work has provided credit unions with a vital forum to network and help each other.

"When I walk into a smaller credit union, it's amazing the effort, time, and devotion folks have for helping members," said Senkpeil, who was one of four finalists in contention for the award. "It's difficult for them, but their desire to help members is so much more important. It provides so much inspiration to help credit unions where I can."

Added ICUL President/CEO Sean Hession: "The entire Illinois credit union system family could not be more proud of Joni and the important work she does for our small credit union community. She is truly a credit union hero to us every day."

The four nominations for the award were:
  • William Armstrong, director, Northeast Community CU, Elizabethton, Tenn., with $99 million in assets;
  • Dan Morrisey, CEO/treasurer, Queen of Peace Arlington (Va.) FCU, with $2.1 million in assets;
     
  • William "Bill" Rissel, president/CEO, Fort Knox FCU, Radcliff, Ky., with $1.1 billion in assets; and
     
  • Senkpeil.
 Voting took place on creditunionmagazine.com between April 1 and May 1.

CEO explains why Ind. CUs are good places to work

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INDIANAPOLIS (5/6/14)--Four Indiana credit unions were listed in the Indiana Chamber of Commerce's 100 Best Places to Work, and the CEO of award-winning Purdue FCU said the honor is meaningful to the credit union and to potential employees.
 
In a Sunday interview on "Inside INdiana Business," Bob Falk, CEO of the $793 million-asset credit union, said he asks new employees how they heard about the credit union and if they knew it was on the list.
 
"Almost every single one of them says, 'Yeah, I checked the list,'" Falk said. "I say good for you for going to a company that really has these kinds of standards."
 
Purdue FCU, West Lafayette, earned the No. 1 ranking in the medium-company category for 75-249 employees. Eli Lilly FCU, Indianapolis, with $1.03 billion in assets came in at No. 2, and Financial Center FCU, Indianapolis, with $496 million in assets, was No. 9. Earlier this year, Financial Center FCU was ranked No. 3 in Workplace-Dynamics' Top Workplaces in Central Indiana for the third timeIndianapolis Star April 14).
 
In Best Places' large-company category--250-999 employees--$931 million-asset FORUM CU, Fishers, ranked No. 3.
 
The Best Places organizations were determined through employer reports and comprehensive employee surveys.
 
"This is a tremendous honor for these credit unions, for their employees and for the 294,000 members they serve collectively," said Indiana Credit Union League President John McKenzie.  "Their commitment to providing a positive environment and career opportunities for their staff members is impressive."
 
Falk said, "What I tell my employees about this every year is we do this because they want us to do this. Why not be the best employer? Why not strive to be the best there is?
 
"It means everything to us," he added.

Webster: Six things that will change payments

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LAS VEGAS (5/6/14)--Credit unions hold a valuable asset amid all the turmoil in the payments industry--members' checking accounts, Karen Webster, CEO of Market Payment Dynamics, told the Credit Union National Association Payments Roundtable participants in Las Vegas Monday.
 
Click to view larger image If consumers don't see value in a technology, they won't adopt it, and neither will merchants, said Karen Webster, CEO of Market Payment Dynamics. "Your No. 1 job is making sure your product is the one your members love," she told the Credit Union National Association Payments Roundtable in Las Vegas Monday. (CUNA photo)
"You have the ability to connect and make the [checking account] more valuable and useful for your consumers," Webster said. "You have the relationship, and you have the funding source. Everyone wants access to that asset."
 
Webster offered participants six things that will change the future of payments:
 
Payments will become invisible. Anything that involves a merchant and a consumer interacting in the physical world can be reinvented by a new idea in the online world, Webster said. "The scary part for you is that consumers no longer whip out a plastic artifact that has your logo on it," she explained. "That's a reality that you have to think about when you think about the design of your strategy." At the same time, as payments become invisible, lots of other commerce opportunities are opening up for new players, Webster said.
 
Payments will move to the cloud. In the future, payment will less about devices and more about the software that connects those devices to the cloud and other connected devices. "There is no point of sale anymore," Webster said. "Point of sale used to be a fixed location is a store. It doesn't have to be anymore." Retail in-store checkout could be transformed, she said. Sales representatives could patrol retail space with tablets that maintain a running inventory, ready to serve consumers on the spot.
 
Creative destruction is the new norm. Those who ruled the payments industry for the last 50 years may not lead the way going forward, Webster said. She used the recording (Apple) and shopping (Amazon) industries as examples of business sectors where new leaders have emerged in recent years.
 
In addition to new competitors and innovators, regulation can be a force of creative destruction in the financial services industry, she said. She called regulation as "double-edge" of creative destruction. "Certainly regulation is essential to protect consumers, but there's a point where it can go too far," Webster explained. "We certainly don't want to eliminate the opportunity for consumers to access the services they need because of unintended consequences."
 
Business models are changing. The way money flows across payments systems will look dramatically different in the near future, Webster said. Regulation already has affected the traditional business model on the debit side. "For better or for worse, merchants no longer value paying for acceptance," Webster said. "One of the things the industry has to come to grips with is how do you monetize what merchants and third parties value, and that is the exchange of value that these technologies and devices and data facilitate." As an example, Webster cited ShopRunner, an online mall that competes with Amazon on two-day shipping. Where Amazon provides a marketplace, ShopRunner offers individual storefronts.
 
Consumers will decide the winners and losers. If consumers don't see value in a technology, they won't adopt it, and neither will merchants, Webster said. Cash may not be safe and efficient, but a lot of consumers prefer it, and consumers' habits can be hard to change. "When you think about trying to get consumers to do something new, it's a very hard habit to break," she said, adding the value exchange has to be very compelling. "Merchants are waiting for consumers to have accepted something different before they invest in anything new," Webster noted.
 
Change marches to its own beat. Webster said moving the needle to digital from plastic is a function of two factors: How quickly solutions are available and how many people with spending power are willing to adapt to it. One holdup to the process: Millennials are motivated to use new technologies but don't yet have the spending power to create a dramatic change. Boomers, on the other hand, have the spending power but lack the motivation.

CUs 'swimming in data,' says roundtable speaker

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LAS VEGAS (5/6/14)--Credit unions are "swimming in data" that they can transform into insight to improve their bottom lines, consultant Karlo Rodriguez told a Credit Union National Association Payments Roundtable audience Monday in Las Vegas.
 
Click to view larger imageData-management consultant Karlo Rodriguez tells attendees at the Credit Union National Association Payments Roundtable that credit unions need to differentiate between valuable big data and clutter. (CUNA photo)
Credit unions' core processing systems contain the depth and breadth of information that can be used to solve problems and create new opportunities, Rodriguez said.
 
Among the data sets Rodriquez said credit unions have access to:
  • Historical transaction records;
  • Consumer loan history;
  • FICO score;
  • Credit and debit card usage;
  • Mortgage history;
  • Insurance; and
  • Investments.
Most financial institutions hamstring themselves by failing to take the initiative to identify goals or problems that this kind of data can be used to solve, Rodriguez said.
 
"Every credit union has a problem to solve," Rodriguez said. "You might need to make more loans, or you might have a problem with member retention. All of these issues are tied to member data."
 
Among the areas where such "problems" can be solved are:
  • Risk management;
  • Transactional behavior;
  • Delinquency;
  • Financial product design;
  • Member retention; and
  • Member segmentation.
For example, a credit union with a low penetration of checking accounts can identify characteristics of account holders who more actively use their checking accounts, and market to similar members.
 
A credit union that seeks to improve member retention can identify signals that point to members who are most likely to close their accounts within a year and reach out to them with more enticing product offers.
 
Rodriguez suggested a good place for credit unions to begin data analysis is with transactional data. "Remember, you have your members' financial history," he said. "It is that data that so many retailers would love to have. Use it to your advantage."

CU System briefs (05/05/2014)

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  • MADISON, Wis. (5/5/14)--The Filene Research Institute and True Link will hold a free webinar 1-2:30 p.m. (CT) May 22 about their prototype card program to help older members, their families and their caregivers prevent elder financial abuse. Filene is also looking for credit unions to test the True Link card in July ...
     
  • Minnesota Credit Union Foundation Chair Pat Brekken, left, Gillette Children's Specialty Healthcare Development Associate Becky DeRosia and foundation Executive Director Kristina Wright. (Minnesota Credit Union Network photo)
    ST. PAUL, Minn., and WICHITA, Kan. (5/5/14)--More Children's Miracle Network Hospitals (CMNHs) now have DVD box sets of "Biz Kid$," the financial education TV program from the National Credit Union Foundation (NCUF). In honor of National Financial Literacy Month, the Minnesota Credit Union Foundation donated two sets to Gillette Children's Specialty Healthcare, St. Paul, Minn. Also, the Wheatbelt Chapter of Kansas Credit Unions donated a set each to KU Medical Center, Kansas City,  and Via Christi Hospitals, Wichita. The Kansas Credit Union Association reported all of its state's CMNHs now have copies (Vision May 2). NCUF and Credit Unions for Kids teamed up during National Financial Literacy Month to get copies of the educational TV series in every CMNH in the U.S. ...
     
  • MIDLAND, Texas (5/5/14)--It was no misstep when Isidrio Garcia and Rachel Galindo ended up with $20,000 from My Community FCU, Midland, Texas. The couple, who took out a loan during the $277 million-asset credit union's "Texas Two Step" promotion, were called to the branch on the premise that there was a problem with the vehicle identification number. However, when they arrived, they were greeted by staff and a $20,000 check. The funds will pay off their loan amount, and Garcia and Galindo said they would use some of the windfall to go hunting (PermianBasin360.com May 2) ...
     
  • HELENA Mont. (5/5/14)--Kathy Shea, president/CEO of $17 million-asset Heritage FCU, Butte, Mont., announced she will retire July 31 (President's Report May 2). Shea is a longtime board member of the Montana Credit Union Network. Her successor, Jim Anderson, began working at the credit union May 1 to transition credit union duties. Heritage FCU's field of membership includes employees of all Safeway Inc. stores located in the state of Montana ...

CUNA Lending Council hits 1,200-member milestone

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MADISON, Wis. (5/5/14)--The CUNA Lending Council has reached the 1,200-member milestone and is now one of two CUNA Councils with membership in excess of 1,200 members.
 
"The Lending Council continues to grow not only because members appreciate the value of an organization devoted to learning and sharing with peers," said Bill Vogeney, council executive committee chair, "but because the lending business is becoming more and more challenging with every year."

"I can't imagine being in the credit union lending business in a leadership capacity without being a CUNA Lending Council member," said Vogeney, executive vice president/chief lending officer at $3.9 billion-asset Ent FCU, Colorado Springs, Colo.
 
The council's 2014 National Conference is set for Nov. 2-5 at the Hilton Bayfront in San Diego. Sessions will include a focus on consumer, mortgage and business lending topics as well as strategic and leadership issues.
 
With 1,265 members, the CUNA CFO Council also is at a membership milestone.

CUANY report shows how members benefit MORE

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ALBANY, N.Y. (5/5/14)--In concert with its state Government Affairs Conference, the Credit Union Association of New York's released its 2013 MORE Report, which is filled with ways members benefit from their relationships with credit unions--beyond the financial services they offer.

New York credit unions provided more than 135,000 individuals, both for members and nonmembers, with financial workshops and programs last year, including 3,000 separate workshops for underserved consumers (The Point May 1).

Community outreach also played a huge role in the activities of the state's credit unions, as the member-owned institutions gave more than $20 million to charities and community organizations, and worked a combined 150,000 volunteer hours in 2013.

The report also featured hundreds of specific examples of how credit unions throughout the state went the extra mile for their members last year.

As a snapshot: GPO FCU, Hartford, with $202 million in assets, served the local immigrant population by employing staff members from a variety of countries and backgrounds who could speak different languages, while Northern FCU, Watertown, with $197 million in assets, offered special assistance to help members employed by Fort Drum, who faced an 11-week furlough last year.

Finally, the report revealed how prevalent customized products and services are at New York-based credit unions:
  • 91% of New York credit unions offer loans of $1,000 or less;
     
  • 99% offer free checking accounts;
     
  • 88% offer youth savings programs;
     
  • 53% offer low-wealth or first-time homebuyer loans and programs; and
     
  • 36% offer products alternative to payday loans.
"The MORE Report truly underscores the credit union difference that we all talk so much about," said President/CEO William J. Mellin. "It highlights the impact credit unions have in a clear, concise way that is easy to share with lawmakers, the press and the public."

Use the resource link to view the report's accompanying video.

NEFE study: Retirement beats a home for 50% of adults

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DENVER (5/5/14)--Half of U.S. adults say their most important financial goal is having enough money for retirement, according to a new survey conducted on behalf of the National Endowment for Financial Education (NEFE) by Harris Poll.

Meanwhile, the status of homeownership is on the wane, the poll found.

The percentage of consumers who cite having enough money for retirement as their top financial goal has been on the rise since the recent recession, according to NEFE. In 2011, when the organization asked American adults the same question, 47% said having enough money for retirement was their top financial goal.

The "American Dream" has long been associated with the comfort, security and status of homeownership. However, today the perceived importance of homeownership appears to be waning. In 2011, 17% said homeownership was their most-important financial goal, compared to just 13% in the latest findings.

"People are more in tune with the importance of saving for their retirement years," said Ted Beck, NEFE president/CEO. "Economic recovery is inching forward yet many individuals and families still are experiencing difficulty getting back on track. Americans seem to be finding reassurance in more long-term, financial security-based values rather than material values."

The 2014 online survey of 2,025 U.S. adults ages 18 and older asks respondents to consider their financial goals and the challenges of meeting those objectives. In thinking about their own financial situations, 60% feel they are achieving the "American Dream," compared with 57% in 2011. But there are barriers that limit people from reaching their goals, with 63% citing the inability to save enough as an obstacle--compared with 70% in 2011--and 47% stating that managing debt is a hindrance--compared with 54% in 2011.

Loans surge at CUs, CUNA monthly report says

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MADISON, Wis. (5/5/14)--Credit unions experienced a "surprisingly" strong surge of lending activity in March, according to the Credit Union National Association monthly credit union estimates.
 
Click to view larger image Click for larger view
"We're surprised on the upside," said CUNA Senior Economist Steve Rick. "Year-over-year loans were up 8.5%, and in March we had forecasted about 7.5%."
 
Loans outstanding increased 0.7% in March to a total $669.3 billion, and year-to-date loan growth was 1.4%--"way better than anything we've seen in the past five years," he told News Now. In 2010, year-to-date loan growth was -1.4%, rising to 0% in March 2012.
 
"It's really good for credit unions' bottom line and net income because there is less money sitting in lower-yield investments," he said.
 
Fixed-rate first mortgages led the way at 2.3%, followed by new auto loans at 1.8% and used auto loans at 1.1%. Adjustable-rate mortgages and unsecured personal loans ticked downward at -2.1% and -1.2%, respectively.
 
Click to view larger image Click for larger view
"Usually the first quarter is not big for loan growth because people are usually paying down debt after the holidays," Rick said.
 
However, a recovering labor market tips the scales in favor of consumer confidence, he said. The U.S. Department of Labor reported an addition of 288,000 jobs in March (See related story: April job adds, slimmer unemployment may not tell whole story.)
 
With savings up 3.8% year-over-year and 0.4% from February, "both sides of the balance sheets are strong," Rick noted. March 2013 savings balances stand at $964.4 billion compared with $929.3 billion one year prior.
 
"Overall, we may have to revise up our credit union earnings forecast," he said.

Mobile branch keeps raindrops from falling on members' heads

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HARRISBURG,
A Sun East FCU employee keeps a senior member dry during the mobile branch's visit to a Media, Pa., retirement center. (Pennsylvania Credit Union Association photo)
Pa. (5/5/14)--One of the credit union movement's icons is Joseph Stern's "Little Man Under the Umbrella,"and employees at Sun East FCU, Aston, Pa., modeled it well last week.
 
The $486 million-asset credit union has a mobile branch that it uses to bring services to elderly residents at Lima Estates, a retirement center in Media, Pa.
 
Heavy rain was falling during last week's regularly scheduled visit--one that the members rely on. The employees held umbrellas for the members, keeping them dry while accompanying them to the mobile branch (Life is a Highway May 2).
 
The employees may have been wet and cold, but the memory of that extra mile in member service warmed the hearts of the credit union leadership.

The two employees earned True Blue cards, part of Sun East FCU's internal recognition program.

Teen filmmakers win chance to create CU commercial

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PATERSON and PROSPECT PARK, N.J. (5/5/14)--North Jersey FCU, through its charitable foundation, recently awarded a group of young filmmakers the opportunity to create a 30-second commercial for the Totowa, N.J.,-based credit union.  

Lourdes Cortez, North Jersey FCU president/CEO, left, presented a $1,000 check to Nicole Romero, center, one of three students filmmakers who will produce a 30-second commercial for the credit union. At right, James Giffin, vice president of business development. (Daily Exchange photo)
The $1,000 prize was presented to Nicole Romero, Nayley Moran and Paul Harris, who produced a short film called "Dream Act" to win the award at the 10th annual Passaic County Film Festival April 26.

"It was very hard for our judges to choose a winner from the many talented films we viewed," said Lourdes Cortez, president/CEO of the $213 million-asset credit union. "I was amazed at the level of talent, professionalism, and thoughtfulness these teens put into their work. I really look forward to working with them."

The trio also won two other categories at the film festival, including top honors in the High School Music Video and High School Documentary Short Film categories.

Working with credit union staff, the commercial the group films for the credit union will be aired on local cable network stations in Totowa, Little Falls and Paterson. The spot will be used to showcase the North Jersey FCU Foundation and its philanthropic work.

"This is a great opportunity for me," Romero said. "We are really looking forward to working with the credit union staff to produce a meaningful and captivating commercial that will focus on reaching my generation and peers. It should be a lot of fun."

CU gives golden opportunity to students with $357K in scholarships

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SACRAMENTO, Calif. (5/5/14)--Dozens of students heading off to college this fall recently struck gold when a Sacramento, Calif.-based credit union announced that it had awarded them thousands of dollars in scholarships for their achievements in academics, community service and extracurricular activities.

Golden 1 CU, with $8.2 billion in assets, will distribute a total of $357,500 in scholarships--ranging from $1,000 to $5,000 per year--to 33 full-time students just before the school year begins in August.

The scholarships are automatically renewable for two to four years, meaning the student can count on the money being there for subsequent school years.

"These students represent our future leaders," said Golden 1 President/CEO Donna Bland. "We congratulate each of our winners. Our scholarships help them achieve their dreams of a bright and productive future."

To qualify, applicants must have a GPA of 3.0 or higher and have participated in community service and extracurricular activities. The student, or the student's guardian or parent, needs to have been a Golden 1 member for at least one year as well.

Applications are accepted for the scholarship program between Oct. 15 and Jan. 15 every year. The scholarships are awarded to students planning to attend accredited, nonprofit colleges and universities in California.

CU System brief (05/02/2014)

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  • (CORRECTION) FARMERS BRANCH, Texas (5/2/14)-- As part of its ongoing involvement in the Cornerstone Credit Union League's advocacy program, a new team of advocates at A+ FCU held its first  CU: R.O.A.R. meeting , which was attended by Jim Phelps, league vice president of advocacy. The $1.06 billion-asset credit union signed up for the league's "Credit Unions: Ready. Organized. Activate. Respond." program more than a year ago and is active in Hike the Hill visits, Project Zip Code and other advocacy efforts . . .

N.Y. state GAC visits vital to CU message

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ALBANY, N.Y. (5/2/14)--Credit union leaders in New York just wrapped up three days of important work networking and meeting with lawmakers as part of the Credit Union Association of New York's (CUANY) 2014 State Governmental Affairs Conference (GAC) in Albany.

Assemblyman Brian Kolb (R-Canandaigua), left, and William J. Mellin, president/CEO, Credit Union Association of New York, at this week's state Governmental Affairs Conference. (Credit Union Association of New York photo)
Nearly 150 credit union advocates attended the three-day event, which concluded Wednesday with discussions about credit union issues with more than 100 lawmakers from the Senate and Assembly ( The Point May1).

"Advocating for credit union issues both at the state and federal levels is vital," said Louis Jimenez, league board member and CEO/treasurer of Montauk CU, New York, with $156 million in assets. "We need to educate our lawmakers so that they understand what we need to better the lives of our members. It all comes down to how we can help our members."

The conference began with a compliance update provided by Michael Carter, CUANY compliance director, who focused on the National Credit Union Administration's risk-based capital (RBC) proposal.

Leadership at the Credit Union National Association has been working to modify the NCUA's proposal, as the organization believes, in its present form, it would overburden credit unions, cause unnecessary expense, impose higher loan rates and service fees for members, and diminish returns on savings.

CUNA estimates the current RBC proposal would reduce credit unions' capital buffers by about $7.6 billion.

"I think it's extremely important that we all stay educated on the key issues that our industry is facing so we can do a better job of educating our members," said Mike Mattone, assistant vice president of Municipal CU, New York, with $1.9 billion in assets.

Additionally Monday, attendees heard presentations from state lawmakers about the importance of state-level advocacy for credit unions.

Former Rep. Vito Fossella praised credit unions specifically for their work in low-income and underbanked communities.

"When all the banks pull out, it's the credit unions that step in," Fossella said, calling credit unions a "central part of the nation's fabric who provide capital when others walk away."

On Tuesday, the group attended a legislative briefing regarding the various issues facing credit unions at the state level, including prize-linked savings accounts, state charter enhancements, "demand note" robberies, and public funds depositories.

State Rep. asks La. CUs for alternative loan suggestions

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HARAHAN, La. (5/2/14)--Louisiana credit unions quickly responded when state Rep. Sharon Weston Broome (D-Baton Rouge) requested that the Louisiana Credit Union League work on alternatives to payday loans.
 
On April 14, Broome submitted a concurrent resolution, SCR 79, that asked the league to "work on viable laon and product alternatives for consumers who do not qualify for traditional bank loans and services."
 
"We immediately called on our credit unions," Connie Major, league executive vice president, told News Now. The quick response to the survey meant the league had examples of what Louisiana credit unions are doing in this area to show Broome during last week's meeting.
 
The draft response to Broome included input from 32 credit unions that offer payday loan alternatives. Program examples include hope loans that consolidate all existing payday loans into one with a six-month repayment plan; OOPS (occasional overdraft protection services) loans that allow a member to overdraw their account up to a certain amount; and salary advance loans that are based on members' direct deposit amounts and require a member to put 5% of the loan amount into savings.
 
In addition to special loan programs, more than 70 credit union staff have successfully completed the certified financial counselor program (FiCEP). Another 80 students are currently enrolled in the course.
 
"She knows the good work credit unions are doing," Major said of Broome.
 
The resolution gives the league until March 2015 to respond, giving plenty of time to collect additional efforts by credit unions.

State agencies advise caution with virtual currencies

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MADISON, Wis., and SAN FRANCISCO (5/2/14)--Two states have decided to publicly warn consumers and investors about the perils of breaking into the world of online currency, each specifically mentioning bitcoin, the currency's most popular form, in their respective notes.  

The California Department of Business Oversight cautioned that currency exchanges--where bitcoin can be bought and sold--remain unregulated, and are susceptible to cyberattacks ( San Francisco Business Times April 30).

The department specifically cites an incident that occurred in March when $350 million in bitcoin was stolen from the exchange Mt. Gox.

"As with many new investment opportunities, fraud potential is high," the department said, adding that it was also concerned about the extreme volatility of the currency.

Bitcoin can be purchased or sold through online, virtual currency exchanges.

The currency, which relies on a highly complicated algorithm and third-party "miners" to validate transactions, is stored in e-wallets online that require personal keys to access.

The Wisconsin Department of Financial Institutions, the second agency to express concerns over the currency, worries about it being unregulated and about its volatility as well.

"These alternative currencies--unlike traditional currencies--are not backed by tangible assets, are not issued by a governmental authority and are subject to little or no regulation," said Peter Bildsten, DFI secretary, in a press release. ". . . the concept behind the currency is difficult to understand even for sophisticated financial experts. Investors should be aware that investments that incorporate virtual currency present very real risks."

The Wisconsin department offers additional concerns about using the currency:
  • The Internal Revenue Service recently declared that virtual currency will be treated as property and not as currency, and transactions therefore may be subject to certain taxes under IRS code;
     
  • Virtual currencies have been connected to criminal activities;
     
  • Virtual currency accounts are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration, which insure bank and credit union accounts up to $250,000; and
     
  • Investors have to rely upon the strength of their own computer security systems, and security systems provided by third parties, to protect their e-wallets from theft.

UBIT victory, RBC top reads for News Now in March

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MADISON, Wis. (5/2/14)--The news that the Internal Revenue Service cleared nearly all credit union products from being subject to unrelated business income tax (UBIT) was the top story for News Now in April. The April 9 article captured the victory of credit unions regarding "substantially related income" from products and services that would not be subject to UBIT.
 
The National Credit Union Administration's risk-based capital proposal made the list twice--most notably for the article about a credit union board member who was moved to write his first-ever comment letter regarding the proposal.
 
National issues such as the Heartbleed security flaw and yet another retailer data security breach also were widely read.
 
The complete Top 10 follows:
 
10. CU loan growth continues, say CUNA Monthly Estimates
 
MADISON, Wis. (4/3/14)--Credit union loans outstanding increased in February, as year-over-year loan balances rose significantly, according to Credit Union National Association's monthly sample of credit unions.
 
9. NCUA testifies supplemental capital could be considered as part of RBC plan
 
WASHINGTON (4/8/14)--The National Credit Union Administration could consider allowing credit unions greater access to supplemental capital as it finalizes proposed risk-based capital regulations, NCUA General Counsel Mike McKenna said this morning.
 
8. CUNA: New data breach shows need for improved merchant security standards
 
WASHINGTON (4/21/14)--A data breach at Michaels Stores and associated business Aaron Brothers may have impacted 2.6 million cardholders, the arts and crafts retailer confirmed late last week.

7. Mich. regulator adds 'S' to CAMEL for state-chartered CUs
 
LANSING, Mich. (4/29/14)--The Michigan financial services regulator has let state-chartered credit unions know that as of April 10 his department has adopted a modified CAMELS rating system--one that includes the "sensitivity to market" or "S" component.

6. CUs assure members in face of Heartbleed, receive threat guidance

MADISON, Wis. (4/11/14)--When the Heartbleed security flaw made news earlier this week, credit unions moved swiftly to inform members of the steps they had taken to protect their online banking credentials.
 
5. Watch out, banks: Large CUs keep pace in mobile services
 
LOS ANGELES (4/4/14)--Wipe out the image of doddering credit unions when it comes to mobile services. The largest credit unions are keeping up with the banks in this important service area, according to GOBankingRates .
 
4. Ind. senator proposes relief measure for CUs, community banks
 
WASHINGTON (4/11/14)--A Republican senator from Indiana introduced a bill Thursday intended to give credit unions and community banks some relief from "crippling financial regulations" enacted in the wake of the 2008 financial crisis.
 
3. NCUA approves modified stress test rules
 
ALEXANDRIA, Va. (4/24/13)--A new rule on stress tests for large credit unions was adopted today by the National Credit Union Administration. It includes changes recommended by CUNA, but CUNA still believes the rule is not necessary.
 
2. CU director's concern for members re: RBC plan sparks his 1st comment letter
 
WASHINGTON (4/14/14)--Until the risk-based capital plan was issued, Lou Gull, secretary and director of Chartway FCU, was happy to let his credit union's CEO take the lead on comment letters that addressed regulatory proposals. But this time it's different. Very different.
 
1. IRS yields to CU-led court decisions challenging tax payments
 
WASHINGTON (4/9/14)--Credit unions have received a much-sought-after interpretation by the Internal Revenue Service that clears nearly all credit union products from being subject to unrelated business income tax.

CUs hang 10 with 'Catch the $ave Wave'

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MADISON, Wis. (5/2/14)--Credit unions caught the save wave in celebration of National Credit Union Youth Week. The annual celebration is an opportunity to formally acknowledge young members and encourage them to start and maintain a saving habit. Credit unions used this year's "Catch the $ave Wave" theme as a fun way to educate young members.
 
Click for slide show United Community CU, with $65 million in assets, Quincy, Ill., hosted a Youth Day to celebrate Credit Union Youth Week.
Among this year's activities:
  • Nine credit unions in California and Nevada and two chapters of the California and Nevada Credit Union Leagues held "Bite of Reality" events throughout both states, reaching nearly 1,000 students. The hands-on simulation Bite of Reality program is offered by the Richard Myles Johnson Foundation, together with the California and Nevada Youth Involvement Network. It is designed to teach young people the basics of finance in a fun, interactive way. Participants are given a fictional occupation, salary, spouse and family, student loan debt, credit card debt, and medical insurance payments.
     
  • Every young member who opened a new uSavers account or deposited $25 or more into an existing account at $933 million-asset Unitus Community CU, Portland, Ore., was entered into a drawing for a family fun beach getaway. The package included an annual family pass to the Oregon Coast Aquarium and a $300 Unitus Visa gift card to create the perfect getaway. Unitus CU also held free community events at all eight of its branches, with giveaways, prizes and refreshments, the Northwest Credit Union Association reported. ( Anthem April 29).
     
  • Cool "Beach Guys" made from balloons greeted youngsters at all eight branches at $755 million-asset Fibre FCU, Longview, Wash., where coloring contest entries covered the walls and "$ave Wave" messages filled lobby screens and reader boards. Kids who deposited $10 or more into their Smart Start Account earned a chance to win $1,000 in prizes, including a $500 gift card to Great Wolf Lodge.
     
  • Young savers who opened a new account or added to an existing account at $61 million-asset Lower Valley CU, Sunnyside, Wash., earned a chance to win a Kindle Fire or Leap Pad 2.
     
  • Oregon Pioneer FCU, with $23 million in assets, Portland, Ore., set its members on the road to a better financial future with a cool road map for families to teach their kids about financial responsibility.
     
  • Cornerstone FCU, with $96 million in assets, Carlisle, Pa., "caught the save wave" by celebrating young members throughout April, the Pennsylvania Credit Union Association reported Life is a Highway April 29). The credit union offered children and teens a savings incentive and held a Youth Day event at the credit union's main office April 26. Any child or teenager opening a new account in April or making a deposit into an existing account received a coupon for free skating admission or a free game of bowling. They were also entered into a savings incentive prize drawing.
     
  • Youth members of $737 million-asset Collins Community CU, Cedar Rapids, Iowa, received a free pair of sunglasses if they made a $5 deposit into their account or a free beach towel if they made a $25 deposit.
     
  • San Francisco FCU, with $868 million in assets, took part in two Junior Achievement workshops for local students and conducted a Mad City Money workshop. It also hosted a table at Healthy Kids Day at Peninsula Family YMCA.
     
  • Silver State Schools CU, with $637 million in assets, Las Vegas, displayed piggy banks full of coins at each of its branches. Young members could guess how many coins were in each piggy bank. The winner received the piggy bank and the money inside. In addition, any youth member who came into a branch during Youth Week wearing flip flops received a free T-shirt.
     
  • Young members at $371 million-asset First Source CU who made a deposit in their Kirby Kangaroo or CU Succeed account were entered into a contest to win Enchanted Forest Water Safari tickets. Any member of the New Hartford, N.Y.-based credit union under age 18 who made a deposit during Youth Week was entered in a drawing for a family four-pack of tickets to the water park ( Rome Sentinel April 29).

Minn. CUs celebrate success at annual meeting

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ST. PAUL, Minn. (5/2/14)--The Minnesota Credit Union Network (MnCUN) celebrated success, presented its annual awards and announced the results of its board elections at the league's annual meeting, held April 25-26 in St. Paul, Minn.
 
Len Luoma, center, Hermantown FCU board chair, was honored as the 2014 Outstanding Volunteer of the Year at the Minnesota Credit Union Network's annual meeting. The award was presented by Pat Pierce, left, MnCUN board chair and president/CEO of City and County CU, St. Paul, and Mark D. Cummins, right, MnCUN president/CEO.
National Credit Union Administration Chair Debbie Matz was the April 25 general session speaker. Among the issues Matz addressed were risk-based capital standards, interest-rate risk and consumer choice.

"Consumers choose the financial institution that best meets their needs," Matz said. "Credit unions are providing the up-to-date services that their members want, and other consumers are recognizing that, too."
 
She congratulated Minnesota credit unions for their solid growth and financial performance, including a 3% growth rate that is well above the national average.
 
MnCUN honored two credit union advocates with its most prestigious awards--Outstanding Credit Union Volunteer of the Year and Outstanding Credit Union Professional of the Year.
 
Leonard Luoma of $115 million-asset Hermantown FCU was recognized as the Outstanding Credit Union Volunteer of the Year.
 
Luoma has served as Hermantown board chair for 41 years. During his time on the board, Luoma's leadership has helped drive Hermantown's growth to $116 million in assets from $1 million in assets.
 
Barbara Brown, president/CEO of $70 million-asset Northwoods CU, Cloquet, was recognized as MnCUN's 2014 Outstanding Professional of the Year.
 
Barb Brown, president/CEO, Northwoods CU, Cloquet, is the Minnesota Credit Union Network's 2014 Outstanding Professional of the Year. The award was presented by Pat Pierce, left, MnCUN board chair and president/CEO of City and County CU, St. Paul, and Mark D. Cummins, right, MnCUN president/CEO. (Photos provided by Minnesota Credit Union Network)
Brown has served with Northwoods CU since 1987, starting as a teller and working her way through several positions before becoming CEO in 2003. Since 1999, Northwoods' assets have more than doubled--reaching $70 million--and membership has increased by more than 160%.
 
Brown also led Northwoods CU's sponsorship of its community ice arena.
 
Two incumbents were re-elected to three-year terms on the MnCUN board of directors. Dan Stoltz, president/CEO of $606 million-asset Spire FCU, Falcon Heights, was re-elected to a seat for credit unions in the Twin Cities metro area. He also was elected secretary/treasurer of the board.

Paul Knorr, president/CEO, Accentra CU, Austin, with $111 million in assets, was re-elected to the greater than 10,000 members seat.

The MnCUN board also elected the following table officers:
  • Chairman--Chuck Albrecht, president/CEO, $250 million-asset Mid-Minnesota FCU, Baxter; and
  • Vice chairman--Kelly McDonough, president/CEO, $137 million-asset First Alliance CU, Rochester.

CUs 'viable option' to payday loans in Mo.

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ST. LOUIS (5/1/14)--A credit union professional recently appeared on a Missouri-based television show to talk about how people can begin breaking away from credit-busting payday lenders when in need of some quick cash ( Missouri Difference April 30).

Caption: Mike O'Brien (left) talks with Mike Ferguson, host of Missouri Viewpoints.
Payday lenders notoriously offer small-dollar loans--often to the under-banked and economically disadvantaged--and charge exorbitant fees and interest if the loan isn't paid off promptly.

Speaking on the show "Missouri Viewpoints," which is broadcast throughout the Show Me State, Mike O'Brien, senior vice president and chief advocacy officer of St. Louis Community CU, said that credit unions offer programs to help people correct problems with credit, and avoid the pitfalls associated with using payday lenders.

"Credit unions are a very viable option," said O'Brien, representing the $229 million-asset credit union. "There are small-dollar loans available through most credit unions, and some credit unions even have payday loan alternatives that have very fair terms and low-interest rates and fees."

O'Brien added that consumers need to take steps to establish a relationship with a credit union or community bank before securing a small-dollar loan.

Because these smaller, signature-type loans don't require any collateral, the risk tends to be higher for the lending institution.

"Most credit unions that offer these types of products want you to have some type of a relationship with them, say six months minimum . . . with a checking account in good standing," O'Brien said. "Then that way they will make that credit available to you, and do so at a rate and a term that is much more favorable for you as compared to a traditional payday lender."

Many credit unions also offer credit-building loans to help repair credit, which can lead to more affordable lines of credit. O'Brien also said not to be afraid to ask for help at credit unions, which often provide financial consulting services.

Segments of "Missouri Viewpoints" are broadcast on television and the radio throughout the state. The Missouri Credit Union Association helped coordinate O'Brien's appearance on the show.

To watch the full episode, use the resource link. O'Brien's interview starts at the 15:46 mark of the video.

Chartway opens doors to home ownership for public service employees

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VIRGINIA BEACH, Va. (5/1/14)--Chartway FCU has made the dream of home ownership more affordable and accessible for public service employees--from teachers and firefighters, to law enforcement officers, military members, and civil servants--with a 100% financing mortgage loan.

Click to view larger image Members of the military stop by one of Chartway FCU's branches to meet with Member Service Representative Brooke Smedley to learn more about its Hometown Hero Mortgage Loan Program. (Chartway FCU photo)
The $1.9 billion-asset Virginia Beach, Va.-based credit union's Hometown Hero Mortgage Loan Program includes 100% financing, low closing costs and no mortgage insurance.

"This was a way for us to give back to the civil service employees of the community and make homebuying easier and affordable for them," Claire Alexander, Chartway FCU communications and marketing specialist, told News Now .

The program will also drive ownership to local communities, said Lisa Cafferty, the credit union's director of retail mortgage origination. "We cut through the red tape and hassle for these public servants so it would be easier for them to get into a home or buy a new one," she said. "So often we talk in our society about the sacrifice these individuals make on our behalf, but many of them don't have the money for down payments. This program removes that barrier."

Qualified candidates must meet income limitations, certain debt-to-income ratios and have a minimum FICO score of 680.

Another feature of the Hometown Hero Mortgage Loan Program is seller-paid closing costs. In cases where a seller must get out of the home quickly to relocate, or for other reasons, they can help the buyer close by paying upfront costs.

Iowa report highlights Hispanic opportunities

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DES MOINES, Iowa (5/1/14)--A new report commissioned by the Iowa Credit Union League (ICUL) highlights opportunities for Iowa credit unions to grow membership and increase revenue through service to local Hispanic communities.

Forty-six percent of Iowa Hispanics, who comprise the largest minority group in the state, are unbanked or underserved. 
 
"Business leaders have a tendency to think of service to Hispanics as a strategy important only to states in the 'gateway' region of the U.S.," said Miriam De Dios, CEO of Coopera, an Iowa-based firm focused on the emerging Hispanic market. Coopera is an ICUL partner and helped develop the Iowa Hispanic Opportunity Report.

"Yet, as this report demonstrates, providing fair and dignified financial services to the Hispanic community is a smart investment for Iowa businesses, as well," De Dios said, adding, "And this extends to credit unions, which adhere to a 'people helping people' philosophy that can lend to increased buy-in from executive leadership."
 
The report includes the following information:
  • Hispanics represent more than 5% of Iowa's population;
  • Between 2000 and 2010, the Hispanic population in Iowa nearly doubled;
  • By 2040, Hispanics will represent nearly 13% of the state population;
  • A majority of the Hispanic population is Mexican, and nearly 40% are foreign born;
  • Seventy-three percent of Iowa Hispanics speak Spanish at home or are bilingual;
  • The average homeownership rate among Hispanics is 54%; and
  • Collective purchasing power of Iowa Hispanics exceeds $3.4 billion.
The Coopera team conducted estimates for Iowa demonstrating the potential return on a collective credit union investment in service to Hispanics. If 10% of Iowa's Hispanic adults were members of a credit union, they would contribute an estimated $64 million in new loan receivables and $5.2 million to annual income.

"Iowa credit unions have the opportunity to improve the financial lives of the youngest, fastest growing and most underserved population in the state," said Murray Williams, ICUL chief operating officer. "Our hope is that this report will help Iowa credit unions increase their market share and decrease the average age of their credit union members."
 
The Iowa Hispanic Opportunity Report also includes case studies of Iowa credit unions with successful Hispanic outreach efforts, including $46 million-asset Des Moines Metro CU; $328 million-asset Ascentra CU, Bettendorf; $329 million-asset Greater Iowa CU, Ames; and $2.4 billion-asset Veridian CU, Waterloo.

A+ FCU makes voices heard with CU: R.O.A.R.

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FARMERS BRANCH, Texas (5/1/14)--As part of its ongoing involvement in the Cornerstone Credit Union League's advocacy program, a new team of advocates at A+ FCU recently held its first  CU: R.O.A.R. meeting, which was attended by Jim Phelps, league vice president of advocacy (The Advocate April 29).

The $1.06 billion-asset credit union signed up for the league's "Credit Unions: Ready. Organized. Activate. Respond." program more than a year ago and is active in Hike the Hill visits, Project Zip Code and other advocacy efforts.

Two A+ FCU employees spearheaded the effort, recruiting 20 volunteers from the credit union's branches to be a part of the advocacy team.

The first meeting began with a presentation from A+ FCU CEO Kerry Parker, who spoke about the importance of becoming politically engaged.

Organizers then conducted a one-hour presentation called "Credit Unions: What Makes Us Different and Why Does It Matter?" where they covered the history of credit unions and highlighted the differences and advantages credit unions hold over banks.

Later, Phelps gave a presentation covering information about state and federal lawmakers in Texas, meeting with elected officials and working with political action committees.

The meeting concluded with team discussions about subjects such as local engagement, participation in political action committee activities, and how to communicate and educate co-workers about advocacy and political activism.

Phelps came away impressed with the first R.O.A.R. event. "This dynamic group has hit on a great way to conduct their advocacy meetings, getting the most mileage out of the time available," said Phelps in The Advocate. "Other credit unions can learn from the structure they have implemented."

Session end in sight, Mo. patent 'troll' bills keep moving

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JEFFERSON CITY, Mo. (5/1/14)--With a little more than two weeks remaining in the 2014 session, two bills regarding patent "trolls" are successfully making their way through Missouri's General Assembly.
 
HB 1374 was voted out of the Senate Judicial Committee and is currently waiting to be assigned to the Senate calendar. Its companion bill, SB 706, passed through the Senate and has been placed on the House calendar. (See related story: CUNA joins with 400 firms, amplifies patent reform support.)
 
"We have a good shot of getting one of these passed," said David Kent, director of state legislative affairs, Missouri Credit Union Association. There was no opposition to these bills in the committee stage, he added.
 
Both prohibit bad-faith assertions of patent infringement, list evidence the court may consider and provide remedies the court may award. Patent "trolls" buy up patents in order to extract fees--or legal settlements--from other companies that may use that technology. Credit unions sometimes choose to settle instead of fight the abusive demands.
 
"It's a good, common sense bill," Kent told News Now . "It will protect small businesses, including credit unions, by serving as a deterrent and make these patent trolls think twice before sending frivolous demand letters alleging patent infringement."
 
The Missouri state legislative session ends May 16.
 
Missouri is one of more than a dozen states that have taken up patent reform legislation.

Pa. CU update act off to quick start

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HARRISBURG, Pa. (5/1/14)--The Pennsylvania State House Commerce Committee unanimously passed legislation that would modernize the state Credit Union Code, the Pennsylvania Credit Union Association (PCUA) reported Wednesday.
 

HB 2009 now moves to the full house for consideration ( Life is a Highway April 30).
 
"I think what distinguishes this bill is that it is indeed a stand-alone credit union bill," Michael Wishnow, PCUA senior vice president, told News Now . "We haven't had a stand-alone credit union bill in 10 years."
 
The PCUA took the lead drafting the legislation with the support of the Pennsylvania Department of Banking and Securities. Attending the hearing on behalf of the PCUA were Rick Wargo, executive vice president/general counsel; Christina Mihalik, vice president, governmental affairs; and Megan Strausbaugh, communications specialist.
 
Special guests included association State Credit Union Advisory Committee members Lonny Maurer, president/CEO of the $389 million-asset Belco Community CU; and Greg Smith, president/CEO, PSECU. Both credit unions are based in Harrisburg.
 
Representative Lynda Schlegel Culver (R-Sunbury), House Commerce Subcommittee chair on Financial Services and Banking and the primary sponsor of HB 2009, addressed the committee members with a precise explanation of the intended provisions of the bill. These provisions include:

The Pennsylvania State House Commerce Committee this week unanimously passed House Bill 2009, which would modernize the state Credit Union Code. From left: Rick Wargo, Pennsylvania Credit Union Association executive vice president/general counsel; Rep. Lynda Schlegel Culver (R-Sunbury); Christina Mihalik, PCUA vice president, governmental affairs; and Rep. Chris Ross (R-Kennet Square). (Pennsylvania Credit Union Association photo)

"On behalf of the association, I commend Secretary of Banking and Securities Glenn Moyer, Representative Lynda Culver, and House Commerce Committee Chairmen Chris Ross and Curtis Thomas for their leadership on behalf of all state chartered credit unions," said Patrick Conway, PCUA president/CEO. "The association will be working closely with State House Leadership over the next few weeks as HB 2009 makes its way through the legislative process."

  • Clarification of the ability for a credit union's membership to amend, or appeal a board-initiated bylaw amendment. Credit unions will no longer need to submit a petition obtained from the department when a credit union amends or appeals its bylaws.
  • Inactive accounts will reflect the Pennsylvania Treasury escheat to five years from six years.
  • The ability for a credit union to correspond to its membership by facsimile transmission, email, or other electronic communication after obtaining its members' consent.
  • Credit unions may collect fees paid to outside collectors for other share or loan service related amounts owed to the credit union. In addition, credit unions may recoup the actual sums it expends.

CU System briefs (05/01/2014)

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  • HARRISBURG, Pa. (5/1/14)-- U.S. Rep. Scott Perry (R-Dillsburg), center, visited the new headquarters of PSECU, Harrisburg, Pa. ( Life is a Highway April 29). The building features a rooftop garden that reduces heating and cooling costs; reserved parking areas for bikes, high-occupancy and fuel-efficient vehicles; and smart lighting that maxmizes natural light, according to the credit union. Perry met with Pennsylvania Credit Union Association President/CEO Patrick Conway, left, and Greg Smith, president/CEO of the $4.1 billion-asset credit union (Pennsylvania Credit Union Association photo) ...
  • SAN FRANCISCO (5/1/14)-- The board of the Federal Home Loan Bank of San Francisco selected Bradley Beal to fill a vacant Nevada member director position , effective today. Beal is president/CEO of $698 million-asset One Nevada CU, Las Vegas. The term ends Dec. 31, 2015. Richard Heldebrant, president/CEO, Star One CU, Sunnyvale, Calif., with $6.6 billion in assets, is the other credit union representative on the board, which includes commercial banks, credit unions, industrial loan companies, savings institutions, insurance companies and community development financial institutions ...
  • MARLBOROUGH, Mass. (5/1/14)--Credit union-sponsored teams from the Northeast fared well at the national LifeSmarts championship in Orlando, Fla., this week ( Daily CU Scan April 30). The New Hampshire team, representing Mascoma Valley Regional High School, Canaan, and supported by Northeast CU, Portsmouth, took top honors after besting the Massachusetts team . The Massachusetts Credit Union League's CU Effect program sponsored the second-place team from Milton (Mass.) High School. New Hampshire met Rhode Island's team from Barrington High School, Providence, in the semifinals. Florida's defending championship team went down to Massachusetts in the semis. LifeSmarts is a quiz-show format program of the National Consumers League that teaches and rewards teenagers for their consumer and financial knowledge (Massachusetts Credit Union League photo) ...
  • FARMERS BRANCH, Texas (5/1/14)-- After 18 years at Doches CU, James Muse has retired as president ( Leaguer April 30). Before joining the Nacogdoches, Texas-based credit union, Muse worked for Shell FCU, Deer Park, Texas; Methodist Hospital Employees FCU, Dallas; and the Texas Credit Union League. On April 1, Richard Lynch succeeded Muse as president/CEO of the $40 million-asset credit union. Lynch most recently spent nine years as CEO of St. Joseph's CU, San Antonio, Texas, with $43 million in assets ...
  • DENVER (5/1/14)-- Robert Gonzales, Security Service FCU, San Antonio, Texas, was elected president of the Denver chapter of the Mountain West Credit Union Association , which represents credit unions in Arizona, Colorado and Wyoming. Gonzales, who is an assistant vice president at the $7.6 billion-asset credit union, has been on the association's board since 2011 ...

Be ready: ACA compliance is here, CUNA Mutual notes

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FORT LAUDERDALE, Fla. (5/1/14)--Final rules for the Affordable Care Act (ACA) have been issued, and credit unions need to make sure they are compliant, advised two experts at the CUNA HR/TD Council Conference in Fort Lauderdale, Fla., Tuesday.
 
During the session on health care reform, Annette Bechtold, senior vice president of regulatory affairs, Digital Benefit Advisors (DBA), and Brad Pricer, senior manager of product management, CUNA Mutual Group, made their message clear: "The time is now to act and get your health and welfare benefit plans in order."
 
Bechtold said in the process of issuing final rules, the government has in some cases made it more complicated by adding transition elements.
 
"The ACA is still a changing law and will likely continue to be so," Bechtold told the audience. She cited the April 1, 2014, repeal of the annual deductible limit for small health plans for 2014. The limit was originally to be $2,000 for self-only coverage and $4,000 for family coverage.
 
The duo noted some final rule details that credit unions should be aware of:
  • Definition of a full-time employee. Under the proposed rules, only one methodology was provided, which included measuring variable-hour and seasonal employees (which is not applicable to all employers). The final regulations provide two methods, one of which needs to be used by each employer.
     
  • Nondiscrimination rules. It's OK to treat plan participants differently as long as the distinctions are based on a bona fide employment-based classification consistent with the employer's usual business practice. These examples include exempt vs. non-exempt positions, geographic locations and current vs. former employee.
     
  • ACA reporting obligations. The report form does not exist yet, but Bechtold shared an overview of what will be needed.
Pricer said the Department of Labor (DOL) is continuing to audit ACA compliance. Compliance is important not only for ACA but for other programs such as the Employee Retirement Income Security Act, which provides for health and welfare plans.
 
"If a credit union plan is audited, the DOL won't just be looking at the credit union's ACA compliance, but all compliance aspects of their health and welfare benefit plans," Pricer said. "For example, does the credit union have proper Summary Plan Descriptions distributed to plan participants?  Are any required IRS Form 5500s being filed?"
 
These aren't requirements of the ACA, but they could potentially trigger fines if the credit union is non-compliant, he added. Pricer said he still is unaware of any credit unions that have actually been audited for ACA compliance. However, Bechtold added her company has seen employers in other industries audited.
 
"At this point, audits are likely the result of complaints from employees, not random.  However, after additional reporting requirements go into effect in 2016, random audits are likely to increase," she said.
 
Pricer discussed health care exchanges, also known as marketplaces, by providing an overview of the public exchanges offered through the ACA and the potential offerings from private exchanges.
 
If an appropriate private exchange is available in a credit union's area, it could allow the credit union to change how it funds health insurance for employees. "Essentially the credit union could switch to a defined contribution approach from a traditional defined benefit approach to plan funding," Pricer said. "This shift in funding strategies could help credit unions save money and better estimate the cost of providing health insurance year-over-year."