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NCUF: Over 80,000 Money Rules Books Distributed

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MADISON, Wis. (6/4/13)--More than 80,000 copies of the book "Money Rules: The Simple Path to Lifelong Security" have been distributed to credit union members and employees through a special initiative by the National Credit Union Foundation the past six months.

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"Money Rules," by bestselling personal finance author Jean Chatzky, contains a set of actionable rules that, if followed, will allow readers to enjoy a lifetime of financial security and eliminate their stress about money, NCUF said.

Through the NCUF initiative, credit union organizations can receive the book for a reduced rate--through a donation to NCUF. Large quantities of the book have been requested by credit unions and state credit union associations, such as Fox Communities CU in Appleton, Wis., and the Michigan Credit Union League in Lansing, Mich.

Other credit unions are distributing the "Money Rules" books at community events, offering it to new members as part of their on-boarding program, and giving copies as thank-you gifts to members and volunteers.

When an organization requests 1,000 or more copies of the book, the donor organization's name will be included on a sticker on the front cover. Each book already comes with "Compliments of: NCUF" printed on the cover. All the books are sent to credit union organizations on a non-returnable basis, for promotional purposes only and not for resale.

For more information, use the link.

CU System Briefs (06/04/2013)

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  • WASHINGTON (6/4/13)--
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    Credit Union National Association President/CEO Bill Cheney and CUNA Executive Vice President of Strategic Communications and Engagement Paul Gentile last week briefed reporters at Bloomberg Government, also known as BGOV, on legislative, regulatory and policy issues that face today's credit unions. BGOV, launched January 2011, has a growing presence in Washington, D.C. as it provides aggregated news, data, information and analysis to policy makers, media, lobbyists and business leaders. Shown here, BGOV staffer David Boyajian grabbed a quick shot of Cheney during the briefing and thanked the CUNA leader on Twitter for addressing the reporters' breakfast meeting ...
  • YORK, Pa (6/4/13)--A 28-year-old man has been sentenced to more than 87 years in federal prison for robberies of a credit union and two banks in 2007. According to the U.S. Department of Justice, Tristan Green also was ordered to pay $217,178.45 in restitution and serve a two-year sentence for a parole violation (York Daily Record May 31). The sentences were added to his current 30-year sentence for an earlier robbery at Fulton Bank in Etters.  Green and three others were accused of robbing the Heritage Valley CU on Sept. 20, 2007; Sovereign Bank, York, on Nov. 14, 2007; and Sovereign Bank, Harrisburg, on Dec. 6, 2007 (The Sentinel June 1). Two have pleaded guilty and are awaiting sentencing while the other has been sentenced to almost 13 years in prison and ordered to pay a $2,000 fine ...
  • DES MOINES, Iowa (6/4/13)--The Iowa Credit Union League (ICUL) was recognized by the Central Iowa Chapter of the Public Relations Society of America (PRSA) and the American Marketing Association (AMA) at their PRIME and NOVA awards ceremonies this spring. At the PRSA PRIME Awards Ceremony in April, ICUL received the Award of Excellence for the redesign of its website and the Award of Merit for its 2011 Annual Report. The PRIME awards recognize excellence in Central Iowa agencies, organizations and individual professionals' public relations efforts. The AMA also awarded the league's website redesign third place in the Nonprofit Marketing category at its NOVA awards in May. The Nonprofit Marketing category recognizes marketing programs intended to change behavior, grow membership, increase awareness, raise funds and generate support ...
  • MADISON, WI (6/4/13)--Members of the UW CU in Madison, Wis., now have the convenience of depositing their checks into their savings and checking accounts by taking photos with their mobile devices. It launched Mobile Deposit to help members save time and give them the convenience of banking on their own schedules. "We're committed to giving members access to the latest technology to make banking as convenient and accessible as possible, " said Eric Bangerter,  vice president of E-Commerce and Internet Services at the $1.6  billion asset credit union. "Mobile Deposit saves members a trip to a branch or ATM since they can deposit checks whenever they want, day or night." Mobile banking is a free service ...

Fastest Annual Pace For CU Loan Balances Since 2008

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MADISON, Wis. (6/4/13)--Over the past year, credit union loan balances are up 5.2%--the fastest annual pace since 2008, according to an analysis by a Credit Union National Association economist of CUNA's monthly sample of credit unions for April.  

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"Credit unions reported strong financial performance in April, as well as the first four months of the year," Steve Rick, CUNA senior economist, told News Now. "Loan balances rose 0.63% in April 2013, compared with 0.57% in April 2012. New- and used-auto loan balances continue to surge with April growth rates of 0.96% and 1.1%, respectively."

CUNA released its Monthly Credit Union Estimates Tuesday. Credit union loans totaled $621.1 billion in April, compared with $590.3 billion in April 2012. Credit union loans outstanding grew 0.6% in April--the same as in April 2012. Leading loan growth were adjustable rate mortgages (2.1%), unsecured personal loans (1.1%), used-auto loans (1.1%), new-auto loans (1%) and credit cards (0.3%). Fixed-rate mortgages and other mortgage loans declined 1.2% and 0.3%, respectively.

"Despite the recent pick up in loan growth, the average credit union loan-to-savings ratio fell from 67.2% in April 2012 to 67% in April 2013, due to slightly faster growth of savings compared to loans," Rick said. The ratio was 66% in March.

The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--fell to 20% in April from 21% in March. "This excess liquidity is keeping downward pressure on credit unions' net interest margins and overall earnings. Credit unions' return-on-assets ratio came in at 0.85% in the first four months of this year, below the 1.02% average set in the 20 years prior to the Great Recession."

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Credit union savings totaled $927.2 billion in April--or $48.4 billion more than the $878.8 billion in April 2012. Credit union savings balances declined 0.4% in April, compared with a 0.7% decrease in April 2012. One-year certificates and individual retirement accounts grew 0.3% and 0.1%, respectively, while share drafts declined 2.4%, money market accounts fell 0.5%, and regular shares declined 0.2%.

Regarding asset quality, credit unions' 60-plus-day delinquency rate fell to 1% in April from 1.1% in March.

"Improving loan quality is reducing provision-for-loan-loss expense, and therefore offsetting somewhat the tighter net interest margins," Rick said. "The delinquent-loans to total-loans ratio fell to 1.02% in April, down from 1.37% in April 2012. This is the lowest loan delinquency rate since August 2008. We expect the credit union delinquency rate to fall to 0.9% by the end of this year and 0.8% by the end of 2014. The credit union loan delinquency rate will then be approaching the 0.75% average set in the 20 years prior to the Great Recession."

Total credit union membership grew 0.2% during April. As of April, credit union membership totaled 96.7 million.

The movement's overall capital-to-asset ratio remained at 10%. The total dollar amount of capital is $112 billion.

Study: Overdraft Revenue Fell $1B In First Quarter

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LAKE BLUFF, Ill. (6/4/13)--Overdraft revenue for financial institutions dropped at an annual rate of nearly $1 billion or 2.8% during first quarter 2013 from first quarter 2012, according to a quarterly study by a Chicago-area economic research firm.

Total deposit service charges fell 2.9% on an annualized basis, which is the first quarterly drop since fourth quarter of 2011 and the second drop in two years, said Lake Bluff, Ill.-based Moebs Services.

Overdraft revenue for first quarter 2013 was $31.1 billion. That compares with $32 billion in fourth quarter 2012; $31.8 billion in third quarter 2012, $31.5 billion in second quarter 2012, and $31 billion in first quarter 2012, said the firm. Since these are all annual rates, that means that overdraft revenue fell from $8 billion in the fourth quarter of 2012 to just under $7.8 billion in this year's first quarter.

"Overdraft revenue is starting to act like a barometer of sluggish economy," said Michael Moebs, economist and CEO of Moebs Services. "With the net pay of Americans suffering a jolt under the Affordable Health Care Act's provisions of increased taxes starting Jan. 1, savvy checking account users are fine tuning their finances and reducing expenses especially deposit service charges."

"The tax issue, coupled with the seasonal nature of overdrafts helped dampen OD revenue," he added. February and March are historically low months for overdraft transactions because consumers are trying to recover from holiday spending, he said. "With the reduction of net pay right after the holidays, February and March moved up a month sooner, making the first quarter of 2013 bad."

Although population, household formation and newly opened checking accounts continued to grow, overdraft transactions fell to the lowest level since 1999, said the firm.

Moebs also noted these factors:

  • The Consumer Financial Protection Bureau's decision to delay potential overdraft regulations so it could study the issue.  "This threw banks and credit unions into a quandary over how to position price changes on overdrafts," Moebs said, adding, "most financial institutions decided to keep the prices the same while the consumer was overdrawing less--median national charge for an overdraft is $29."
  • Marketing by financial institutions to give waivers on the first six overdraft transactions in a year or to forgo small overdraft balances of less than $5.
  • Lower prices offered by financial institutions.  "Our data show financial institutions that lower prices to help the consumer reduce fees actually increase revenue from having more volume of new checking accounts and transactions," Moebs said.
The study indicates that overdraft revenue in the past six months reflects economic behavior, legislation, regulation and social/cultural changes, Moebs said, adding that the  same changes occurred in the 1990s and 2000s while overdraft revenue continues to grow.  Currently about 30% of the 135 million checking users range from underbanked to less than 600 FICO scores, and the percentage was the same 20 years ago, he said.

"This seems to tell us the consumer and small business person need a financial safety net and want overdraft service. Banks, thrifts and credit unions also appear ready to provide the overdraft safety net, hopefully in a transparent, low price way, free of market restrictions, " Moebs said.

Iowa and Nebraska. Leagues Partner With CoOportunity Health

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DES MOINES, Iowa (6/4/13)--Credit unions in Iowa and Nebraska will partner with CoOportunity Health to offer affordable, cooperative health insurance options for individuals, families and businesses starting this fall.

Like credit unions, CoOportunity Health is a not-for-profit organization. It is a new health insurance consumer operated and oriented plan (CO-OP) created as part of the Affordable Care Act to create new competition and new choice.

It is one of 24 CO-OPs approved nationwide, but the only one to serve Iowa and Nebraska. CoOportunity Health is managed by and for its members. Any savings will be used to increase member benefits and lower premiums, similar to the mission of credit unions.

Iowa and Nebraska credit unions will be the exclusive financial institution distribution channel for CoOportunity Health when open enrollment for health insurance begins Oct. 1. Between the two states, there are more than 180 credit unions serving about 1.45 million members.

"CoOportunity Health's mission and philosophy are perfectly aligned with credit unions and we believe that by working together, we can have a tremendous impact by educating Iowans and Nebraskans on the pending changes in healthcare while providing them a new, member-focused choice for health insurance," said Dave Lyons CoOportunity Health CEO.

The partnership among the Iowa Credit Union League (ICUL), Nebraska Credit Union League (NCUL) and CoOportunity Health has been in development for more than two years. It is believed to be the first of its kind among cooperatives nationwide. It will give participating Iowa and Nebraska credit unions the tools to provide member outreach and education on healthcare reform while making CoOportunity Health's insurance options available to individuals, families and businesses.

Among the priorities for the leagues is helping members credit unions decrease the average age of members and increase market share. Through the partnership, potential target markets will be young adults, the uninsured, Hispanics and small businesses, the leagues and CoOportunity Health said. 

"Credit unions know that financial well-being is directly linked to overall health and well-being. We believe this link will only increase in the months and years ahead," said Patrick S. Jury, ICUL president/CEO. "Credit unions serve as trusted advisors in their local communities. Through our partnership with CoOportunity Health, our members and those who seek out membership will have access to vital information and new health insurance options at a time of great confusion and need."

Under the partnership, credit unions can establish Health Savings Accounts when a prospect enrolls in a qualified high-deductible health insurance plan through CoOportunity Health.

Group Benefits Ltd. (GBL) will serve as the preferred broker for the credit union/CoOportunity Health partnership in both states. Based in Urbandale, Iowa, GBL has been in business for nearly 20 years and manages benefits for 2,000 employer groups and 30,000 individuals.

"Credit unions have a long-standing relationship with GBL and they will be an excellent partner in offering CoOportunity Health products to our membership," said Scott Sullivan, CEO at the Nebraska league. "Through our partnership with CoOportunity Health and GBL, Iowa and Nebraska credit unions will be able to help our members closely pair the expense of healthcare with their financial well-being."

Credit unions in both states also are looking into CoOportunity Health's group health insurance plans as an option for their employees.

Lake Mich. CU's Checking Featured In USA TODAY

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GRAND RAPIDS, Mich. (6/4/13)--Lake Michigan CU in Grand Rapids, Mich., offers a high-yield checking account with rates as high as 3% on up to $15,000 in savings--or $450 in interest--in its Max Checking product, according to a Saturday USA TODAY article based on a Bankrate.com study of 56 high-yield checking accounts.

The article, "Finding cash-yielding reward checking accounts," by Susan Tompor, said savers need to have some cash to stash and patience to find a credit union or other financial institution that offers high-yield or rewards checking accounts.

The $2.73 billion asset credit union requires members to check their accounts online at least four times each month among other requirements, USA Today said.  

The Bankrate.com survey indicated that, for the financial institutions it surveyed, the average balance cap is $17,102 for rewards checking products.

Also, 61% of the high-yield checking accounts in the survey are available nationwide, Bankrate.com said.

The survey also indicated the average interest rate on the high-yield checking accounts studied fell to 1.64% this year from 2.05% in 2012. That is better than average yield on a one-year certificate of deposit--which from Jan. 2 to May 8 was 0.26%, Bankrate.com said.

To read the USA TODAY article and Bankrate.com survey, use the links.

Eight CU Pros, Volunteers Honored With CUANY Awards

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ALBANY, N.Y. (6/4/13)--Eight individuals have been named winners of the Credit Union Association of New York's  2013 Recognition Awards for professionals and volunteers. The winners will be honored June 14 at CUANY's Annual Meeting and Convention in Lake George.

The judges looked for individuals and credit unions that show an ongoing dedication to the credit union philosophy, community involvement, volunteerism, professionalism and youth financial education.

The award categories and recipients include:

  • New York Credit Union Hall of Fame Inductee: John Felton, CEO, Southern Chautauqua FCU, Lakewood;
  • Outstanding Volunteers: Donald Bruning, board president, Great Erie FCU, Orchard Park ($50 million to $250 million in assets); Don Briner, associate board member, Hudson River Community CU, Corinth ($50 million to $250 million in assets); and Ann Tyler, board chairman, AmeriCU CU, Rome (more than $250 million in assets);
  • Outstanding Professionals: Marsha Brauer, manager/CEO, Clarence Community & Schools FCU, Clarence (up to $50 million in assets); William Carhart, CEO, Oswego County FCU, Oswego ($50 million to $250 million in assets); and Lisa Whitaker, president/CEO, CFCU Community CU, Ithaca (more than $250 million in assets); and
  • Outstanding Young Professional: Lisa Totaro, marketing associate, Sunmark FCU, Latham.

Filene Studies Leadership of Canadian CUs

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MADISON, Wis. (6/4/13)--A new Filene Research Institute Report finds that good leaders combine both transactional traits--such as goal setting and rewarding exceptional performance--and transformational traits, such as trust, respect and the ability to motivate employees.

The report, "Leadership and Results: A Study of Canadian Credit Unions," recommends training and talent rotation to nurture both types of traits.

The report was compiled from a study of 22 of Canada's 30 largest credit unions. The study included the collection and analysis of 485 leadership surveys, and data on growth in membership and assets under management for each credit union. The study answered three core questions:

  1. Are there differences in leadership behavior and leadership effectiveness across the credit unions?
  1. What leadership behaviors do the most effective leaders exhibit
  1. Is there a relationship between leadership effectiveness and financial results?
Among the recommendations for credit unions the report offers:

  • Integrate transactional and transformational leadership into existing talent practices. Establish an expectation of both transactional and transformational leadership behaviors at all levels. Consider tracking, monitoring and rewarding these leadership behaviors through annual organizational and individual goal setting, 360 feedback and employee surveys, compensation practices, and learning and development programs.
  • Offer training programs and peer coaching options to develop key leadership behaviors. Create a training program or enhance existing programs to focus on key transformational and transactional leadership behaviors such as coaching, motivating, goal setting and performance management. Given the experience level of credit union leaders, it may be worthwhile to offer both refresher and more comprehensive training programs.
  • Boost new role/assignment opportunities. Provide opportunities for leaders to enhance their transformational and transactional leadership behaviors through special projects, short-term assignments, or a temporary transfer to another area in the credit union.
  • Consider the benefits of becoming larger. Whether through organic growth or through mergers and acquisitions, becoming a larger credit union correlates not only to more effective leadership but also to better financial results, the report said.
 

To download the report, use the link.

SECU Student Loan Rehab Program Reaches $7M

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RALEIGH, N.C. (6/4/13)--State Employees' CU has purchased $7 million in loans from the North Carolina State Education Assistance Authority (NCSEAA) to provide financial support to state college students.

The purchase of student loans through NCSEAA's Loan Rehabilitation Program provides funds to NCSEAA that are used to assist other student loan borrowers and aid in the development of educational offerings.

"The Loan Rehabilitation Program continues to be successful in giving student loan borrowers an opportunity to succeed," said Mike Lord, chief financial officer of $26 billion asset SECU. "Sometimes success requires a second chance and through the purchase of these federally insured student loans, SECU is helping NCSEAA give more opportunities to those in need.

"Investing in our state's students is a good thing and our partnership with NCSEAA is truly beneficial for all involved," Lord added.

Authorized under federal law, the Loan Rehabilitation Program was put in place to help student borrowers who defaulted on Federal Family Education Loans earn a second chance to repay the loans, repair their credit histories and improve their lives.

Program participants must meet certain qualifications, including remittance of nine consecutive voluntary payments at an amount the borrower can sustain in the future. Upon qualifying, new repayment terms may be available, eligibility for federal and state financial aid is reinstated and a defaulted loan status is removed from the student's credit record.

The Credit Union National Association's recent Student Borrowing Survey found that half of high school seniors have no idea what college will cost (News Now April 29). The survey has been noted by bankruptcy lawyers, accountants, economic education groups, and national media who are citing CUNA's results as one more reason for financial education.

Judge To Comcast: Divulge IDs To CU Targeted By Phish Scam

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COLUMBIA, S.C. (6/4/13)--A federal judge in Columbia, S.C., has granted AllSouth FCU's request for a court order requiring Comcast Cable Communications LLC to disclose certain subscriber information to assist AllSouth in identifying who targeted it for a phishing scam.

AllSouth, a $666 million asset credit union in Columbia, had sued unidentified "John Does and Jane Does" on April 17 in the U.S. District Court for the District of South Carolina, Columbia Division, after more than 125 members reported they had revealed personal data to a text-message SMS phishing scam (News Now May 9).

The scam used the credit union's identity in the messages. The suit alleges violation of the credit union's trademark, racketeering and violation of state laws.

U.S. District Judge Joseph F. Anderson Jr. Wednesday ordered Comcast, pursuant to the Cable Communication Policy Act, to disclose subscriber information relating to Internet Provider (IP) addresses 74.96.117.190 and 173.166.26.90 from April 1 to April 20.

Information to be disclosed includes: name, address, length of service (including start date), types of services used, telephone or instrument number or other subscriber identity (including any temporarily assigned network address), and means and source of payment (including credit card or bank account number).

Comcast will have seven calendar days after the subpoena is served to notify the subscribers that their identity is sought by the plaintiff. Those subscribers will have 21 calendar days after the Comcast notice to file any papers contesting the disclosure of the information.

The credit union will pay Comcast reasonable costs of compiling the requested information, providing pre-disclosure notifications to subscribers and all other reasonable costs and fees incurred in responding to discovery, said the order.

If the information is no longer available for the period involved, Comcast is then to provide the earliest available subscriber information closest to the original requested dates, the order said.  The information given to the credit union is to be used solely for purposes of protecting its rights under the Trademark Act of 1946, the Racketeer Influenced and Corrupt Organizations Act, and state laws applicable to the suit.

Last month the court had granted AllSouth FCU the ability to subpoena third parties to get the information.