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CU in Texas preparing for fed government shutdown

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LIVE OAK, Texas (7/15/11)--While federal officials debate the nation's debt ceiling, a Texas credit union has announced it will provide services to members affected by any shutdown of government services or delays of payments from the government. Randolph-Brooks FCU (RBFCU), a $4.3 billion asset credit union based in Live Oak, Texas, said Thursday that if the debt ceiling isn't raised, some federal employees might not be allowed to work and people who receive benefits such as Social Security might not receive payment until a compromise is reached. RBFCU said it would provide members with a one-time provisional credit if they are government employees or benefit payment recipients affected by the shutdown. "Serving our members is our first priority," said Sonya McDonald, senior vice president of market development. "Hard-working government employees and Social Security recipients shouldn't suffer because our lawmakers in Washington can't come to an agreement on spending." The provisional credit will be extended to members identified as government employees or benefit payment recipients and who have an established direct deposit with RBFCU. They will not be required to pay interest or fees to receive the provisional credit. "People are already struggling with the high costs of gas, food, and other expenses," McDonald said. "We want to alleviate as much worry as possible for them during this stressful financial time. While we hope the government will resolve its issues, we are being proactive in providing solutions for our members in the event that a shutdown does occur." Meanwhile, as the state of Minnesota finished its second week under a state government shutdown due to that state's budget crisis, credit unions there said they still stand ready to assist government employees and others affected by the shutdown. Last night Republican state legislators were weighing a deal offered by Gov. Mark Dayton, a Democrat, for possibly ending the shutdown. Media reports said the shutdown could end soon. However, if it doesn't, credit unions and the Minnesota Credit Union Network reported they are ready to assist members with programs to help tide over missing a paycheck. Today is the last official payday for state employees under the shutdown. So members so far have had access to their regular paychecks. However, if a shutdown continued, credit unions likely would see more members needing assistance.

Ohio CUs fare well in state budget

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COLUMBUS, Ohio (7/15/11)--Ohio’s credit unions fared well when Gov. John Kasich and the Ohio General Assembly signed House Bill 153, the state’s two-year biennial budget bill for fiscal years 2012-2013, said the Ohio Credit Union League. Many state agencies felt the brunt of budget reductions, said the league (eLumination Newsletter July 13). The spending allowance for the Credit Union Fund was reduced by 4.90% or $177,000 to $3.45 million for fiscal year 2012, and the level will remain the same for fiscal year 2013. The league said it held “numerous meetings with key elected officials throughout the budget process to ensure credit unions incurred no negative effects from the budget.” Budget tightening in other states resulted in higher taxes on credit unions and new provisions such as Wisconsin’s budget provision that makes it easier to switch credit union charters to bank charters. These incidents demonstrate the importance of keeping elected officials informed of credit unions’ role in the community, the league said.

CU builds loan portfolio saves members 40K

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FINDLAY, Ohio (7/15/11)--As is the case with most credit unions, Hancock FCU, based in Findlay, Ohio, is facing the challenge of decreased loan demand. So it looked for ways to build its loan portfolio and centered on refinancings. To help offset costs related to the difficult financial environment, the credit union’s loan officers began asking members about their existing loans at other financial institutions, and suggesting how they could save money by receiving a lower interest rate or shorter-term loan at Hancock FCU (e-Lumination Newsletter July 13). The credit union’s lending officers developed an “apples-to-apples” illustration that showed members how much they could save over the life of the loan--and members took advantage. The lending team kept track of the amount they saved members with branch office savings “thermometers.” The thermometers stimulated additional interest from members, and, through the end of June, the credit union had increased its loan portfolio by more than 5% from June 2010. To date, the $58.8 million asset Hancock FCU said it has saved its members more than $40,000.

Young CU pros in Dakotas launch flood relief program

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BISMARCK, N.D. (7/15/11)--The Young Credit Union Professionals (YCUP) Network of the Dakotas has launched a “Fill-the-Boat” campaign to help families deal with the flood aftermath in North Dakota and South Dakota, which impacted thousands of credit union members. The campaign is accepting basic household supplies through July 29 at 34 credit unions in the two states where donors can drop off items such as garbage bags, mops, brooms, rubber gloves and bleach. “The flooding across the Dakotas has been devastating,” said Roxanne Mullenberg, YCUP member and employee of Postal Family FCU in Fargo, N.D. “Many families have been affected by a combinations of home loss, severe damage to their residence, or forced evacuation from their homes. Having family and friends directly impacted in Minot, N.D., I just felt that we had to do something to help.” “Credit unions were founded on the basis of the 'people helping people’ philosophy and that’s not just with their finances,” said Tanya San Miguel, vice president of operations at Sioux Empire FCU in Sioux Falls, S.D. “The YCUP network was ready to step in and get the ball rolling.” A list of recommended items and drop-off sites in North Dakota and South Dakota can be found at the “Fill-the-Boat” website. Use the link. Credit union supporters in every state can make donations though a secured online disaster relief system--CUAid.coop--website that accepts credit cards and wire transfers. Use the link.

iFoxi picks up report highlighting CUs Christmas Clubs

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NEW YORK (7/15/11)--Credit unions' Christmas Clubs saw a comeback after the financial crisis, the Credit Union National Association (CUNA) said in an article posted on SavingsAccounts.com, which was picked up by Fox Business.com Thursday. The article, "Christmas in July: The return of the Christmas Club," said Christmas Clubs--the interest-bearing savings accounts designed to help people save money each month and receive a lump sum withdrawal before the winter holiday season hits--are "an old idea, but one that's becoming more popular as purse strings grow tighter and people spend less and save more.” The product was in and out of vogue for "decades leading up to the credit card boom, when the idea fell out of style and disappeared from many mainstream banks,” said the article. CUNA was reported as saying the most recent financial crisis in the late 2000s brought new interest in the clubs, "which reached their zenith in 2009." "Today, small financial services institutions and most credit unions still offer a Christmas club product," the article reported. It listed standard features.

Chicago CU makes its first SBDF loan

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CHICAGO (7/15/11)--North Side Community FCU’s new Small Business Development Fund (SBDF) loans provide entrepreneurs the funding to help start a business or expand an existing business. In February, the Chicago-based North Side received funds from the Office of the City Treasurer to offer Chicago-based small businesses micro loans.
Click to view larger image Owners of Rolling Clean Car Wash, Denise Buckman-Morris, from left, and husband Kevin Morris, meet with Tom Laures, North Side Community FCU’s small-business loan officer, after they closed on a $15,000 loan in June to help with marketing, salary and general operation costs for their business. (Photo provided by North Side Community FCU)
An existing business can borrow up to $35,000 while a start-up operation can qualify for up to $15,000. Typically, these loans are used for build out, working capital and acquiring machinery, tools and inventory. The loan term is up to five years at a prime +2% interest rate. As of June, the current rate is 5.25%. Recently, the credit union made its first small-business loan to Denise Buckman-Morris and her husband Kevin Morris, who were almost ready to open their doors after she and her husband invested more than $70,000 into their start-up car-detailing business, Rolling Clean Car Wash. However, they realized they needed some working capital to get the operation off the ground. As members of the North Side in Chicago’s Uptown neighborhood for several years, they learned of the new SBDF. In June, they closed on a $15,000 loan to help with marketing, salary and general operation costs for the business, which is located in Chicago’s Austin Community. “This loan allowed us to get a great jump-start on the business and provide some cushion to fall back on,” Buckman said. “It’s a great program because it helps start small businesses when they can’t get help elsewhere.” Buckman said the loan will allow the hiring of 10 full-time and 13 part-time employees, and provide opportunities and training in a community that has high unemployment and a need for business investment. “Job creation and retention are key elements that we look for in a loan application,” says Jennifer Sierecki, manager/CEO of North Side. “Small-business growth is vital in developing and sustaining our communities.” North Side is outreaching to Chicago neighborhood chambers of commerce and community development organizations to help spread the word about the new loan fund. As a collaborating partner, the Jane Adams Small Business Development Center provides technical assistance for prospective borrowers.

CU System briefs (07/14/2011)

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* INDIANAPOLIS (7/15/11)--An Indiana man, Leon Fuller, 24, was sentenced to nearly 11 years in prison for the Feb. 24, 2010, holdup of an Indianapolis branch of South Bend, Ind.-based Teachers CU. U.S. District Judge Larry McKinney sentenced Fuller to 130 months and ordered him to be placed on supervised release for five years. Fuller pleaded guilty to the armed bank robbery and brandishing a firearm. In the incident, he walked into the credit union, brandished a gun, and forced a member to walk with him to a teller counter. After obtaining cash from a teller, he fled on foot. Fuller was nabbed within hours of the robbery with a large amount of cash in his coat pocket and another $4,528 in his apartment (Indianapolis Star Tribune July 14) … * HARRISBURG, Pa. (7/15/11)--Mike Wishnow, association senior vice president, communications and marketing for the Pennsylvania Credit Union Association (PCUA), has been appointed to the Pennsylvania Economic Education and Personal Finance Literacy Task Force. The nine-member group was selected by the Department of Banking and the Department of Education, said PCUA (Life is a Highway July 14). Required by law, the task force will assess the trends and needs in economic education and personal financial literacy; consider how funds are used to support these areas; and make recommendations to the governor and General Assembly on legislative or regulatory changes to improve the two areas … * SPOKANE VALLEY, Wash. (7/15/11)--Carla Altepeter has been appointed president/CEO of Numerica CU, a $1.1 billion asset credit union based in Spokane Valley, Wash., effective Sept. 1. Altepeter is currently president/CEO of CitizensFirst CU, Oshkosh, Wis., a position she has held since 1992. She will succeed Dennis Cutter, who is retiring Aug. 31 after serving 40 years as the credit union's president/CEO. Altepeter serves on various local and national boards and committees. She serves as vice chair of the Wisconsin Credit Union Foundation board of directors and of the Wisconsin Credit Union Review Board. She is a past member of the Wisconsin Credit Union League Governmental Affairs Committee, a past board member of the Credit Union National Association, and board member and past chair of the Credit Union Executive Society …

Illinois faith-based CU coalition moves forward

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NAPERVILLE, Ill. (7/15/11)--An alliance of Illinois faith-based credit unions is regularly meeting to provide critical support and networking for each other.
A group of interns involved with a coalition of Illinois faith-based credit unions that regularly meets to help each other, posed together recently. With the group are Hiram Crawford (second from left), director with Israel Methcomm FCU, Chicago, and Illinois Credit Union League Regional Director Joyce Jackson (in middle). (Photo provided by the Illinois Credit Union League)
The group comprises more than 20 credit unions with an average of $500,000 in assets and nearly 290 members, said the Illinois Credit Union League. Their goals include networking to help each other with marketing, problem solving, reaching better efficiencies of scale in sharing resources, and gaining secondary capital. Marketing efforts include designing a basic website template so all of the credit unions can achieve an Internet presence. From an operational standpoint, the group coordinated FedComp data-processing training. This opportunity, made possible by a group scholarship from the Illinois Credit Union Foundation, provided about 30 individuals with the opportunity to improve the efficiency of their data-processing systems, performance and record keeping. Also, all the credit unions have worked with National Credit Union Administration Economic Development Specialist Malia Peel to obtain the agency’s low-income designation, a process that takes about 90 days. Currently, eight of the credit unions, as part of the alliance, hold the title. The coalition also is working with Olive Harvey Community College and other city colleges of Chicago to expose interns to credit unions and use their assistance in these projects. About four interns helped research certificate of deposit investment options for the credit unions. Other initiatives on the horizon include providing financial literacy training for board members--a regulatory mandate for federal credit unions and a “best practice” consideration for state-chartered credit unions--and developing community partnerships.