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GCUAs Mercer says no to interchange in op-ed

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ATLANTA and DULUTH, Ga. (6/30/10)--"A controversial [interchange] provision in the financial reform bill pending in Congress should be a big concern for consumers and needs to be taken out," said Mike Mercer, president/CEO of Georgia Credit Union Affiliates, in a pro-and-con op-ed published Monday in the Atlanta Journal Constitution. Referring to the interchange amendment in the bill pending before Congress, the publication had asked, "Should the Fed regulate 'swipe fees' for debit cards?" "No, the fees offset risks born by card issuers and lower fees will mean fewer debit card issuers," said Mercer. The amendment "should be separated from the bill and debated on its own merits" because there are "too many unaddressed and unanswered questions in this hastily prepared add-on," he wrote. Networks currently setting interchange fees "must balance the interests of the merchants and financial institutions: Charge too much and stores will not accept the cards; charge too little and financial institutions will not offer cards to consumers," Mercer wrote. "What factors will the Fed use to set the interchange rate? Will it cover all operating costs such as fraud, card issuance and call center operations?" he asked. Merchants benefit from accepting debit and credit cards because they are immediately paid at the point of sale and do not have to handle cash and bounced checks or wait for a check to clear. Nothing in the law requires merchants to pass their savings to consumers, Mercer said, adding, "What safeguards exist to ensure that consumers will benefit?" "The interchange fee helps credit unions offset the operational expenses and risk of an electronic payment system that supports popular products consumers want, need and enjoy. As not-for-profits, credit unions generally offer lower-priced card services," he said. "The interchange amendment may destroy the ability of small issuers, such as credit unions, to provide debit card services to their members," he said, adding, "The very real possibility is that the amendment will actually increase payment costs and decrease convenience for consumers." The "Yes" viewpoint was presented by the Georgia Retail Association President John Heavener, who argued that swipe fees hurt small retailers and drive up costs for consumers. For the full opinions, use the link.

Consider CU to avoid checking account fees--IUSA TodayI

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NEW YORK (6/30/10)--Consumers worried about new checking account fees can take several steps to avoid them. One step: consider opening an account at a credit union. So says USA Today columnist Sandra Block in her Your Money column. Entitled "How to steer clear of checking account fees on the horizon," the article notes that it has been years since consumers have had to worry about checking account fees. Most financial institutions offered free checking that was subsidized by overdraft coverage fees and revenues from interchange fees paid by retailers for their customers' use of debit cards. But with overdraft and interchange regulations on the horizon, "this means banks are looking elsewhere for revenue," said Block. She noted recent disclosures by Wells Fargo and TCF Financial of plans to start charging fees for customers under the minimum balance required. In telling consumers to consider credit unions, Block cites a survey that found 39 of the 50 largest credit unions offer free checking. Only three require a minimum balance to avoid a checking fee. For the full article, use the link.

CU System briefs (06/29/2010)

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* ORLANDO, Fla. (6/30/10)--Three men have been arrested after a takeover robbery at a branch of Orlando-based McCoy FCU Monday morning in which the credit union manager was beaten. Five armed men stormed the building after 9 a.m., ordered employees to the ground, jumped a counter to the teller area and opened cash drawers (South Florida June 28). Several news accounts said the manager was "badly beaten," while others said the manager was "battered." Police said the group left with an undisclosed amount of money in a red Dodge but then switched to a black Pontiac GTO and a purple Grand Am. Police on patrol spotted one of the vehicles and arrested Marcell A. Stalling, 20; Kyle Sawyer, 20; and Michael Holliday, 19. They are charged with armed robbery with a firearm/mask, aggravated battery with a firearm and armed kidnapping. The other robbery suspects were still at large ( June 28) ... * SACRAMENTO, Calif. (6/30/10)--The Golden 1 CU has launched its Golden 1 app for iPhone and iPad users, announced President/CEO Teresa A. Halleck. The application provides members using the devices with a way to manage everyday banking needs on a single, safe and secure platform, said the $7.6 billion asset credit union. The new Golden 1 app is available for free download at the iTunes App Store. "With nearly 700,000 members, we know that we will have many members who will be able to take advantage of this new service," Halleck said ...

Woods is interim CEO at Arrowhead CU

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SAN BERNARDINO, Calif. (6/30/10)--Kay Woods has been named interim CEO of San Bernardino, Calif.-based Arrowhead CU, the $876 million asset credit union that was placed into conservatorship by the National Credit Union Administration (NCUA) Friday. Woods was formerly a CEO at Las Vegas-based Weststar CU but left years ago to become a consultant. She has experience as a conservatorship manager, according to John McKechnie, director of congressional and public affairs at NCUA. NCUA placed the credit union's senior management on paid administrative leave so it can conduct an ongoing review of the credit union's operations, McKechnie confirmed to News Now. Those on leave include Arrowhead CEO Larry Sharp; Daniel Marciante, chief financial officer; Gene Shabinaw, senior vice president of lending; and Ray Messler, senior vice president of strategic development (San Bernardino County Sun June 29). Income derived from last weekend's sale of four of Arrowhead's branches to Alaska USA FCU was not enough to remedy Arrowhead's poor financial condition, McKechnie said. "The credit union was not reversing negative trends and was not on a trajectory to return to profitability," he added. NCUA board is conducting a thorough review of Arrowhead's operations and will make a determination about the credit union's future when the review is completed, McKechnie said. Located in an area hard hit with high unemployment and sharp declines in the housing market, Arrowhead reported losses totaling $47.1 million in 2009 and $28.6 million in 2008, said the newspaper. In April, its net income was $3.7 million and fourth quarter profits were at $1.7 million. It reported $20.1 million in delinquent loans in March. More than 1,562 members had filed for bankruptcy by December.

CO-OP THINK PRIZE calls for entries

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RANCHO CUCAMONGA, Calif. (6/30/10)--CO-OP Financial Services is calling for entries for the CO-OP THINK PRIZE, which is giving a $10,000 grand prize award for the best idea on how to grow the credit union movement. The new, annual contest is designed to inspire and reward innovative, shareable ideas. The competition will proceed in three rounds, with Oct. 15 as the deadline for round one. Entrants will complete a simple questionnaire that serves as a program proposal establishing the idea and its merits to the industry. With replies of between 25 and 100 words per question, the round one questionnaire asks participants to:
* Describe the idea; * Tell how it benefits credit unions; * List the benefits to credit union members; * Expand on how it exemplifies credit union values; * Detail how the idea will propel the credit union movement forward; and * Explain how it can be shared with other credit unions.
Round one entries judged to be among the best will be invited to participate in a second round. They will be asked to develop a business plan for the idea. The second round deadline is Dec. 31. In the third round, three finalists will present their ideas at the THINK 2011 Conference in May 2011 in Anaheim, Calif. The winner will be determined by conference attendees, online viewers and a panel of experts from the Filene Research Institute and CO-OP. “The THINK Conference was created to excite, energize and inspire new ways of thinking, and the CO-OP THINK PRIZE aims to encourage innovative thinkers in the industry to share their ideas for changing the credit union movement for the better,” said Stan Hollen, president/CEO of CO-OP Financial Services. “Our judges will be looking for ideas that help credit unions be nimble, progressive, innovative and smart, while upholding their fiscally conservative values and personal member service experience.” In addition to the $10,000 in seed money, the winning entrant will also receive pledges of financial support and business services from THINK 2011 sponsors and the Filene Research Institute. Credit unions or individuals employed by them can participate. The three finalists will be notified around Jan. 31. For more information, use the link.

CU volunteers help man wildfire command center

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PHOENIX (6/30/10)--Arizona State CU, based in Phoenix, has helped with efforts in fighting a huge wildfire in the Coconino National Forest. It provided employee volunteers to help answer phones at a nearby command center and aided helpless animals affected by the fire. “We assisted in moving an animal shelter [from the path of the fire] and provided cash contributions to that agency to help it set up a makeshift facility for the animals,” Paul Stull, senior vice president of marketing for the $1.29 billion-asset credit union, told News Now. “We can’t fight the fire; we’re not experts at that, but we certainly can help the people that do,” Stull said. “This is really good time for the credit union to show its commitment to the community.” Fire crews are working toward full containment of the Schultz fire four miles north of Flagstaff, Ariz. The U.S. Forest Service said the fire is 75% contained after burning 15,075 acres. Tuesday’s crew work included checking on hot spots and rehabilitating areas that burned ( via Associated Press June 29). The cost of fighting the wildfire is more than $7.6 million. The person or persons who set the wildfire after leaving an abandoned camp fire remain at large. Pam Leffel, who manages an Arizona State CU branch near the fire zone, has been in the forefront of the credit union’s efforts to help. “She has led a response mostly because we are involved in the community,” Stull said. “But also because many of our members have been evacuated from their homes. "We have responded to wildfires in the past to aid those who were evacuated and to help firefighters save homes; it’s a pretty important thing,” he added. “Our view of it is--that during really tough times--a credit union can show its brand value very well.”

Federation expands consulting tech assistance for CDCUs

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NEW YORK (6/30/10)--Responding to stress in the credit union community and the growing opportunities to access federal resources, the National Federation of Community Development Credit Unions has announced an expansion of its consulting and technical assistance services for community development credit unions (CDCUs). “There is growing alarm among small credit unions that the expenses for corporate stabilization and the Share Insurance Fund will increase pressure to merge or liquidate them,” said federation President/CEO Cliff Rosenthal. “Even small credit unions that are well-capitalized and present minimal risk to the fund are running scared. “To address this, the federation will be supporting several initiatives, including the ‘We Care’ program spearheaded by Joy Cousminer of Bethex FCU and our Spirit Network of faith-based credit unions, as a way to proactively reach out to some of our smallest CDCUs,” he added. Also, Brian Gately, formerly director of technical assistance, will serve as the federation’s senior consultant for small and emerging credit unions, leveraging his experience to help small credit unions meet their regulatory and compliance requirements. Terry Ratigan will continue as lead consultant for the federation’s CU Breakthrough service, which has worked to get a record number of credit unions certified as community development financial institutions and designated low-income. Both credentials are necessary for various federal resources, Ratigan explained. “We’re expanding CU Breakthrough to meet the growing demand for expertise in reaching underserved markets,” Rosenthal said. “Credit unions have never received enough recognition and resources for their work to serve the underserved. We aim to change that.”

Texas league monitoring Alex seasons first hurricane

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FARMERS BRANCH, Texas (6/30/10)--The Texas Credit Union League was tracking the progress of Tropical Storm Alex as it neared hurricane status, the league said Tuesday morning (LoneStar Leaguer June 29). At 10 p.m. Tuesday, the weather service declared Alex as the first hurricane of the season. As of 10 p.m. Alex was about 255 miles to the southeast of Brownsville, Texas. It was moving west-northwest at 12 mph with winds of 75 mph. The weather service said the hurricane likely will strengthen as it crosses the warm Gulf water ( June 29). It was expected to make landfall tonight, possibly as a category 2 hurricane. Hurricane warnings extend from Buffin Bay, Texas, to La Cruz, Mexico. Heavy rains could flood areas in southern Texas and northern Mexico. Credit unions can track the storm on the league's website with its disaster preparation page. The league "will keep readers and visitors updated as the storm moves along its path with news and online updates." Also, the Texas Credit Union Foundation will be ready to activate its Disaster Relief Fund if necessary. Alex is the first Atlantic Basin hurricane during the month of June in more than 15 years--since Hurricane Allison in 1995, said A hurricane has not made a U.S. landfall in June since Hurricane Bonnie in 1986. Given the projected path, it appears that streak will remain intact, with Alex hitting land on July 1. This year's hurricane season is expected to be a heavy one, with more named tropical storms and hurricanes and more major hurricanes. Credit unions already have been reviewing and updating their disaster plans since hurricane season began in May. The season is over at the end of November.

Feds OK Michigans funds for foreclosure help

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LANSING, Mich. (6/30/10)--The U.S. Treasury Department and the Department of Housing and Urban Development have approved Michigan Gov. Jennifer Granholm’s plan to distribute $154.5 million beginning July 12 to help more than 17,000 Michigan households avoid foreclosure. Credit unions should begin preparations to use the funds, which are designed to help members facing mortgage problems from job loss or other financial struggles, said the Michigan Credit Union League (MCUL) (Michigan Monitor June 28). The Michigan State Housing Development Authority (MSHDA) was selected as one of the five state Housing Finance Agencies (HFAs) to share in the Hardest-Hit Fund investment with an award of $154.5 million. The other four participating states are Arizona, California, Florida and Nevada. Michigan will be the first of the U.S.’s five state HFAs to implement the plan. MSHDA will use the time between now and the July 12 launch to hire and train staff, provide information to potential applicants statewide about the program and educate participating credit unions about the application process, said MSHDA Executive Director Keith Molin. “Banks and credit unions will play an integral role in the success of the new program because they will work with homeowners to determine eligibility criteria and best available option,” Molin said. “The smartest advice we can give potential applicants is to contact their mortgage servicers to ensure they make an informed decision.” The program is on a first come, first-served basis; when the money is gone the program will close. Credit unions that want to be proactive in securing assistance for their members should quickly sign on to the program, MCUL said. Michigan’s Hardest-Hit Fund plan is designed to help homeowners who are currently receiving unemployment compensation, who have fallen behind in their mortgage payments or taxes due to a temporary layoff or medical emergency, and who can no longer afford their mortgage payments due to lower income. The plan was developed in partnership with the MCUL and other state organizations. Nationally, more than 57% of mortgage delinquencies can be attributed to job loss, MCUL said. MSHDA’s decision to focus most of its efforts on the problems facing Michigan's unemployed is the proper strategy to pursue, according MCUL President/CEO David Adams. “Michigan is in the midst of an historic remaking of our economy,” Adams said. “Our state’s biggest challenge is sustaining homeownership for unemployed and underemployed borrowers. This plan provides a blueprint on how Michigan credit unions, banks and policymakers can work together to help those who need assistance while transitioning to the 21st century economy.”

N.Y. foundation presents Desjardins awards

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ALBANY, N.Y. (6/30/10)--The New York Credit Union Foundation has awarded first place Desjardins Youth Financial Education Awards to three credit unions.
Click to view larger image Three New York credit unions placed first in the state's 2010 Desjardins Youth Financial Education Awards. From left are: Ray Grossman, board member, Teachers FCU; Jessica Burch, Karen Reardon, Melissa Cummings and CEO Bill Sweeney, CORE FCU; and Marsha Brauer, CEO, Clarence Community & Schools FCU. (Photo provided by the New York Credit Union Foundation)
First place awards went to:
* Clarence Community & Schools FCU, Clarence, in the under $35 million asset category. The credit union was recognized for its youth savings programs offered in all six K-12 schools in its district. * CORE FCU, East Syracuse, $35 million to $75 million. CORE was honored for its "Students as Educators" program, which incorporates a student-run branch at ESM high school, a K-8 school banking program, annual teen finance forums for high schoolers and adult education seminars. * Teachers FCU, Farmingville, $250 or more in assets, which garnered an award for its use of the National Endowment for Financial Education's (NEFE) Basics of Banking module, interactive smart boards and several session of BizKid$, the PBS program on financial literacy. Together, the programs helped motivate young adults to make and manage their money.
An honorable mention was presented to Visions FCU, Endicott, for its success with the promotion of the foundation's Kid's Cash Kit & Caboodle program, which distributes kits that teach children ages five-12 how to manage money using three concepts: saving, spending and sharing. "Improving the financial literacy of our children and youth is more important than ever," said Diane LaVigna-Wixted, foundation executive director. "With all the ups and downs in today's economy, it's essential to equip them with the financial knowledge they'll need to manage their finances while they work toward a sound financial future."