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Belvoir Members Seek Help Through Sequestration

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WOODBRIDGE, Va. (7/16/13)--Since February, Belvoir FCU in Woodbridge, Va., has sought to assist members experiencing adverse effects from sequestration--federal government spending cuts--by developing emergency loan products, forming services to support members, and informing employees of its response.
 
The $299 million asset Belvoir aided 37 members: 20 with financial coaching, four with an emergency loan, seven with loan workout options, and six with a skip-a-pay. It also answered several questions from concerned members.
 
In addition to helping those 37 members, Belvoir's financial coach hosted four seminars for 50 participants about "Taking Charge in Tough Times" and "It's a Matter of Life and Debit" at facilities throughout Fort Belvoir.
 
A number of other credit unions nationwide--especially defense credit unions--have instituted programs to help members who are federal employees and their families deal with the budget cuts. 

NEW: Demand Rises For Mobile Technology, World CU Leaders Told

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OTTAWA, Canada (7/16/13 UPDATED 12:30 pm CT)--As mobile technology's rate of innovation and the rise in consumer demand create uncertainty among financial institutions worldwide, credit unions must consider mobile strategies that are convenient, consolidated and integrated for their members, mobile technology expert and adviser Ian Shelley told a World Credit Union Conference general session audience Monday.
 
Shelley, who was the keynote speaker at Monday's general session, reinforced that the future of credit union services is mobile commerce. The conference is presented through Wednesday by the World Council of Credit Unions.
 
He directed his perspectives on opportunities and risks to the credit union movement, stressing the need for financial cooperatives to provide multifunctional, integrated and data-driven mobile payment solutions to satisfy members' needs and to stay relevant in the marketplace.
 
"Ultimately everyone is going to move toward wanting mobile transactions," Shelley said. "There are more benefits than just the transaction you should think about. The cost of the transaction will be cheaper than any other channel."
 
Credit unions must accept that mobile technology continually will disrupt the payments ecosystem and require adaptation to a new set of competitors, Shelley said. As technology advances, the range of products in the market will consolidate over time. To keep up, credit unions must find their niche and identify the partners who can help them offer mobile channels and products that increase convenience, consolidate activities and integrate with other aspects of members' daily lives.
 
"What you're seeing is integration of pretty much every channel--the integration of everyday life," Shelley said. "It feels as though this is something we can marry together with financial transactions."
 
Credit unions face the same challenges around the world, including consumers' demand for greater convenience and access, which drives the need for credit unions to provide multiple channels of service, according to Monday's opening speaker Brian Branch, World Council president/CEO. Credit unions face the challenge of keeping up with information communication technologies in doing so.
 
"What is so striking is the creativity and innovation in the diversity of answers to these challenges," Branch told the general session audience. "This week at the conference, we will form a global community to share creativity that responds to the changes in technology of communications, payments and commerce."
 
Credit unions in high-growth markets tend to offer access to multiple channels for payments and mobile technology, Branch said. World Council's member organizations and associations list their greatest priorities as regulatory compliance relief and building the capacity of their credit unions to respond to the demand for mobile channels of delivery. As worldwide Internet access rises, mobile transactions will soon overtake online transactions--which overtook branch transactions in recent years.
 
"As the Internet becomes increasingly available, cheaper and faster, transactions and business shift to the Internet and are accessed by mobile devices," Branch said. "According to the International Telecommunication Union, by the end of 2011, one-third of the world population had access to the Internet. By 2015, it projects that 60% of the world population will have Internet access."
 
Monday finished with breakout sessions on leadership and strategy, technology, international credit union experience, advocacy and governmental affairs and innovative solutions. Three of the 10 sessions focused on mobile technology.

NCUA Reviewing RMBS Court Decisions To Decide What's Next

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ALEXANDRIA, Va., and  LOS ANGELES (7/16/13)--The National Credit Union Administration Board is reviewing its options and will pursue its claims vigorously. That is what the agency said after a federal judge in Los Angeles Friday ruled NCUA waited too long before filing some of its claims against Goldman Sachs over $491 million in losses from residential mortgage-backed securities (RMBS) sold to U.S. Central FCU and Western Corporate FCU, which no longer exist.
 
U.S. District Court Judge George Wu also said he would grant NCUA's request for an interlocutory appeal to the Ninth Circuit Court of Appeals on the time-barred issue. The decision affects the federal claims in the case, but not the state-based claims, which will still move forward, said NCUA.
 
"NCUA is reviewing the judges' holdings in the Goldman Sachs, Barclays and Credit Suisse suits and will determine the appropriate course of action based on that review," said John Fairbanks, public affairs specialist with NCUA's Office of Public and Congressional Affairs.
 
"NCUA has substantial claims against these and other companies who sold faulty securities to the corporate credit unions, and the agency will vigorously pursue those claims," Fairbanks told News Now.
 
In Friday's decision, Wu said, "The court grants the motion for interlocutory appeal on the question of whether the Extender Statute applies to extend the statute of repose...because this issue is a controlling question of law, has generated a substantial degree of disagreement, and its resolution can materially advance this litigation."
 
It was the second decision in a week that dismissed some of NCUA's claims against brokerage firms that sold or underwrote  RMBS that caused the collapse of several corporates, including U.S. Central and WesCorp.
 
A U.S. District Court in Kansas earlier last week dismissed the agency's claims against Barclays Capital, saying it was time-barred and that NCUA had not filed the case in time. The Barclays suit was dismissed in total, but that is subject to appeal, if NCUA decides to pursue an appeal.
 
At the same time, the Kansas judge also reaffirmed an earlier decision in which he dismissed 12 of NCUA's 20 claims against Credit Suisse. (See related story in News Now, Court Dismisses NCUA Lawsuit Over Corporate CU Losses Vs. Barclays).
 
At the time of the Barclays and Credit Suisse decisions, NCUA issued a statement noting, "We respectfully disagree with the rulings, and we are reviewing them."
 
In the Goldman Sachs suit, the agency noted that U.S. Central and WesCorp purchased 21 RMBS from Goldman Sachs, which also acted as the underwriter. NCUA alleged losses of more than $491 million in the case.
 
In each of the lawsuits, NCUA alleged that the offering documents for the securities sold to the corporates "systematically abandoned" underwriting standards and misled the corporates into making the investments.  U.S. Central and WesCorp were liquidated in 2009-2010 as a result of their losses.
 
The Tenth Circuit Court of Appeals in Kansas also is reviewing the time-barred issues in a separate suit NCUA filed against RBS Securities.

World CU Conference Welcomes 2,376 Attendees To Canada

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OTTAWA, Canada (7/16/13)--The World Council of Credit Unions welcomed 2,376 attendees from 61 countries at the Ottawa Convention Centre in Ottawa, Canada, Sunday evening for the opening ceremonies of its 2013 World Credit Union Conference.

Click to view larger image Daniel Burns, World Council of Credit Unions treasurer and chair of Credit Union Central of Canada, co-host of the World Credit Union Conference, welcomed attendees to Ottawa.
Through Wednesday, participants will network and learn from industry experts on topics such as mobile banking, social media and corporate leadership.

World Council Chair Manuel Rabines, general manager of Federacion Nacional de Cooperativas de Ahorro y Credito del Peru (FENACREP), the trade association serving Peru's credit unions, welcomed attendees to the event.

"During my travels here from Peru, I reflected upon the great differences that exist in this world that we share," Rabines said. "Despite those differences, there is a common denominator throughout--the credit union model. This model offers a variety of solutions to common problems and is continuously evolving."

Conference attendees also heard from Member of the Canadian Parliament and Liberal Advocate for Co-operatives Mauril Belanger, who spoke in English, French and Spanish and recognized the importance of the audience's international cooperative efforts.

Click to view larger image Flag bearers donned national attire to represent the 61 countries in attendance during the international parade of flags on Sunday at the World Credit Union Conference in Ottawa, Canada.
"I've come to believe credit unions are an element to the solution to some of the world's economic challenges," Belanger said. "The principles on which cooperatives are built offer real solutions to the vast and complex problems facing humanity."

"Canada's credit union movement began not far from here in 1900 when Alphonse Desjardins founded what has become one of the greatest credit union movements today. Around that time, he crossed paths with [Edward] Filene from the United States," Burns said. "It's so appropriate to have the conference here in Ottawa because it was the crossroads of credit union leaders in the past, and it is again today."

Click to view larger image Cirque Fantastic's performance officially kicked off the 2013 World Credit Union Conference Sunday in Ottawa, Canada.  (Photos provided by the World Council of Credit Unions)
Prior to Sunday's opening, the conference hosted several events, including the fifth annual Global Women's Leadership Forum on Sunday. A total of 114 women credit union leaders worldwide gathered to network, attend educational sessions and hear from keynote speaker Sheryl WuDunn, co-author of New York Times best-seller Half the Sky: Turning Opression into Opportunity for Women Worldwide, who presented research from her book and participated in a panel discussion centered on advancement of women leadership in credit unions.

World Credit Union Conference co-host Credit Union Central of Canada (CUCC) is celebrating its 60th anniversary this year. World Council Treasurer Daniel Burns, CUCC chair, gave participants a brief lesson on Canada's cooperative history, which sparked growth in many other nations' credit union movements.

The conference concludes Wednesday with a closing reception at the Canadian Museum of Civilization.

Global CU Statistical Report Features 101 Nations

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MADISON, Wis. (7/16/13)--The World Council of Credit Unions has released its 2012 Statistical Report, which includes information from 55,952 credit unions serving more than 200 million members in 101 countries.
 
Click to view larger image Click for larger view
The most notable global change since 2011 was in credit union reserves, which grew 15% in 2012, from $141.3 billion to $161.8 billion, said World Council. Also in 2012, global credit union lending reached $1.1 trillion; assets grew to $1.7 trillion; and savings and share volume was reported at $1.3 trillion.
 
Member penetration worldwide was 7.72%. New countries reporting 2012 data included Curacao, Fiji, Samoa, Micronesia and Timor Leste.
 
Kenya and the U.S. achieved notable growth in membership, while Brazil's credit unions reported a significant increase in assets in 2012, said the report.

The Kenya Union of Savings and Credit Co-operatives reached 25% membership growth among 5,000 credit unions, increasing to 4.7 million members from 4.2 million. The Credit Union National Association added 2.1 million members, the U.S.'s highest membership growth in decades. In Brazil, Confederacao Interestadual das Cooperativas Ligadas ao SICREDI reported over 20% asset growth in local currency among its member credit unions.
 
World Council reports data based on each country's responses to its annual survey and does not make estimates for non-reporting countries. The electronic-only report provides data on the global credit union movement available and is cited widely by governments, international institutions and analysts as an expert resource, World Council said.
 
To download the report, use the link.

New Jersey CUs' 1Q Reflects Surge in Savings

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HIGHTSTOWN, N.J. (7/16/13)--Savings balances surged in the first quarter for New Jersey credit unions with normal, strong seasonal growth combining with large period-end payday inflows, the New Jersey Credit Union League reported.
 
As a result, both the state aggregate loan-to-savings and capital ratio declined marginally in the quarter (The Daily Exchange July 10). Loan delinquencies fell in the quarter and bottom-line earnings increased, compared with full-year 2012 results.
 
Savings balances rose 4.6%--an 18.4% annualized rate--propelled by increases in share-draft account automatic payday deposits. While loan activity was relatively slow (increasing 0.1% in the quarter), New Jersey credit unions granted a total of $570 million in loans in the first quarter. That is a 10% increase over first-quarter 2012 results and the largest first-quarter volume since 2008.
 
Earnings increased at an annualized rate of 0.48% in the first quarter--a significant jump over the 0.33% full-year 2012 result.
 
Fast asset growth due to big deposit inflows overwhelmed healthier earnings to produce a marginal decline in the New Jersey credit union aggregate capital ratio--though the March 2013 aggregate is nearly 3.5 percentage points above the 6% regulatory minimum credit unions need to be considered adequately capitalized under prompt corrective action (PCA) net worth standards, noted the league.
 
In all, 92% of the state's credit unions now are well-capitalized with PCA net worth exceeding 7% of assets, said the league.

'Don't Tax My CU' Efforts Gear Up On All Fronts

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WASHINGTON (7/16/13)--
Click to view larger image Click for larger view
Credit unions aren't taking the attacks on their tax status sitting down.  The groundswell of activity in the Don't Tax My Credit Union campaign is gathering speed as credit unions, members, leagues and the Credit Union National Association deliver that message to lawmakers.
 
CUNA and the leagues have made more than 336,802 contacts with lawmakers on the issue, as of July 12. Credit unions and members are using CUNA's and the leagues' resources and social media sites including the Don't Tax My CU website, Facebook and the micro-video site Vine, and share the Don't Tax message through Twitter, @CUNAadvocacy and the hashtag, #DontTaxMy CU.
 
Page views on the Don't Tax My Credit Union website more than doubled between June 10 and July 12--to 429,128, while unique visitors more than doubled to 197,176. More than 2,000 credit unions report they have had at least one person take action on the Don't Tax campaign, said CUNA. More than 434,000 impressions have been made on the site's Facebook and Twitter.
 
Click to view larger image Staff at the Credit Union Association of the Dakotas sported Don't Tax My Credit Union T-shirts early Monday morning next to CUAD's CU on the Road vehicle (The Memo July 15). From left: Kaitlyn Hardy, Steve Rahrich, Jeff Olson, Shawn Brummer and Karla Clark. Several credit unions in South Dakota ran out of Don't' Tax postcards and were asking for more, CUAD said. (Photo provided by the Credit Union Association of the Dakotas)
Twenty-three members of Congress are followers of Social Media for CUNA Advocacy. Its Facebook page added 187 more followers--in two days--to reach 2,296, while Twitter totaled 2,405--an increase of 107 followers in just two days. And 14 media outlets have reported on the tax battle.
 
Among the recent efforts:
  • PrimeWay FCU, Houston, Texas, took the "Don't Tax My Credit Union message to YouTube, noting that taxing credit unions "won't make a dent in the budget deficit but will only hurt hard working Americans and small businesses who depend on credit unions."  It features several people urging Congress not to tax them, including one who urges ",Don't tax me, bro." To view it, use the link.
  • Shannon Webster, vice president of marketing, Town and Country CU, Minot, N.D., tweeted that she dropped off nearly 430 don't tax postcards at congressional offices in Minot Wednesday, said the Credit Union Association of the Dakotas (The Memo July 15). The office "seemed surprised when I handed them each a big stack. I think these mailings will definitely have an impact," she told CUAD. And Jared Conkling, a lead teller at Service First FCU, Sioux Falls, S.D., worked with marketing staff to create a Drive-up Window Tube Flyer to urge members to stop in the lobby to sign postcards.
  • In the July 8 issue of Banker and Tradesman, Dan Egan, president/CEO of the Massachusetts Credit Union League, the New Hampshire Credit Union League and the Credit Union Association of Rhode Island, noted credit unions have successfully defended their tax exemption since the earliest days of the movement. "We were set up as a not-for-profit. It's a cooperative." He pointed out the vital role the credit union alternative plays to members and society at large and said that during the financial crisis, "when the nation's major banks imploded, credit unions continued their lending and maintained the flow of money to consumers and small businesses."
  • Coastal FCU, Raleigh, N.C., sent more than 3,700 e-mails to Congress between June 3 and July 11--more e-mails than in some states. "This issue is so tremendous to our industry that we had to make this a priority," Coastal FCU CEO Chuck Purvis told the North Carolina Credit Union League (The Weekly Conversation July 12).
  • Premier FCU, Geensboro, N.C., CEO Lori Thompson said the credit union began e-mails right away. "We're going to have internet PCs available in every branch. We'll have signs, handouts with bullet points and we're adding tags to our name badges to prompt members to inquire about this issue," she told the league. "Whether it's a member of Congress, credit union members or credit union staff, it's necessary for everyone to understand the value that credit unions provide and that changing our structure will negatively impact how we are able to benefit our members."
  • Association of Vermont Credit Unions President Joe Bergeron wrote a letter to Vermont senators Pat Leahy and Bernie Sanders last week that said eliminating credit unions' tax exemption "would represent a tax increase on America's 96 million credit union members, and would ultimately lead to the elimination of credit unions. Too many Vermonters and Americans rely on credit unions to help them save for their dreams and borrow for their needs to let credit unions become unfortunate casualties of tax reform" (Newslines Express July 12).  A number of Vermont credit unions have included information in their newsletters, on their sites, in e-mails as well as on stuffers and posters and banner ads, said AVCU. Several have posted the Don't Tax video on their Facebook pages.
  • Credit unions were the topic of discussion Monday on WTYM AM 1380, a radio station in Kittanning, Pa. Pennsylvania Credit Union Association Director of Communications Diane Powell talked about the benefits of credit unions and the Don't Tax initiative (Life is a Highway July 15).
  • Even credit union service providers are supporting credit unions' tax status.  San Diego-based Xpress Data Inc. is providing free e-mail blast communications for its client credit unions to support the Don't' Tax initiative. It also is providing discounts on statement stuffers. XDI President Mike Cooper said the company shares the industry's concern over its tax status and wants to assist in the mobilization of credit union members. "This initiative from CUNA is unprecedented in credit unions' continued effort to fight and remain tax exempt--part of which truly sets our industry apart from the bigger financial counterparts," he said. "This is an important fight and we want to do our part to help it succeed."

Six Wash. CUs See Save To Win Results

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FEDERAL WAY, Wash. (7/16/13)--Save to Win, the prized-linked saving program, has attracted 559 new accounts at six credit unions in its first 60 days of operation in Washington state, said the Northwest Credit Union Association (NWCUA).
 
Total savings surpassed $250,000, with an average account balance of nearly $500 (Anthem Recap July 12).
 
"This program motivates and entices our members to open an account and start saving money every month,  said Jared Dance, Lacey-based TwinStar CU community development manager. "Also, with the added bonus of entries to win monthly cash prizes, it's truly a win-win situation. Save to Win program has endless potential for our state."
 
Save to Win was created by the Michigan Credit Union League in 2009. For every $25 deposited, account holders earn entries into monthly and annual cash prize drawings. All funds deposited into the accounts, including any interest earnings, belong to the account holders.
 
The program has appealed unbanked and under-banked consumers who were not previously inclined to save money. It was legalized by the Washington State Legislature in 2011. Six Washington credit unions began offering the program April 1, with organizational support and the prize pool funded by the NWCUA Strategic Link subsidiary. Credit unions in Nebraska and North Carolina also offer Save to Win.
 
Founding credit unions in Washington include:
  • Connection CU, Silverdale;
  • Express CU, Seattle;
  • Fibre FCU, Longview;
  • North Coast CU, Bellingham;
  • Bee CU, Tumwater, and
  • TwinStar CU.
TwinStar CU members opened 255 new accounts in the first eight weeks of the Save to Win program.
 
At Fibre FCU, more than 130 accounts were opened, with members saving $60,000.
 
While members of Connection CU quickly opened Save to Win accounts with large balances, the credit union proactively worked with asset-building coalitions and other community groups to ensure consumers who truly benefit from the program learn of the resource.
 
"We have sent Save to Win flyers to some of our community-based organizations to share with their clients," said Lesley Carrell, Fibre CU senior vice president of marketing. "It's a great program for our community, where average income per household is at 70% of the state's average."
 
Studies indicate the possibility of winning a prize while saving money is strong motivation for consumers to open accounts, said NWCUA. The prize pool in Washington offers 100 members the possibility of winning $50 prizes in the first year, as well as four $5,000 prize drawings.

Maine League Recognizes 10 CUs For Service, Fin Ed Efforts

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Click to view larger image Community CU's Hugh Keene, board chair, left, and Kerry Wood, president/CEO, accept four awards presented to the credit union recognizing its commitment to community service, member service and financial education, from Dave Rossignol, past chair of the Maine Credit Union League's board of directors. (Photo provided by the Maine Credit Union League)
PORTLAND, Maine (7/16/13)--Ten Maine credit unions were recognized by the Maine Credit Union League with a record 19 awards as the 2013 honorees of the state-level Dora Maxwell Social Responsibility Community Service Awards, the Louise Herring Philosophy In Action Member Service Awards, and the Desjardins Youth and Adult Financial Education Awards.
 
The state awards were presented at the league's Annual Meeting and Convention in Portland. The awards are part of a national awards program coordinated by the Credit Union National Association. The winners in each asset category will compete in the National Awards program in the fall.

First-place recipients of the Dora Maxwell Social Responsibility Community Service Award, established to encourage credit union involvement in community projects and activities, are:
  • Community CU, Lewiston, $20 million to $50 million in assets;
  • Central Maine FCU, Lewiston, $50 million to $100 million;
  • Oxford FCU Mexico, $100 million to $200 million; and
  • Maine State CU, Augusta, $200 million to $500 million.
First-place recipients of the Louise Herring Philosophy In Action Member Service Award, which recognizes credit unions that demonstrate, in an extraordinary way, the practical application of the credit union philosophy, are:
  • Community CU;
  • Five County CU, Bath,  $50 million to $250 million; and
  • Maine State CU.
First-place recipients of the Desjardins Youth Financial Education Award, which recognizes credit unions that demonstrate leadership and outreach in youth financial education initiatives, are:
  • Community CU;
  • Central Maine FCU; and
  • Five County CU.
First-place recipient of the Desjardins Adult Financial Education Award, which recognizes credit unions that demonstrate leadership and outreach in adult financial education initiatives, is Community CU.

Celebrate 'Miracle Jeans Day' Sept. 18

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SALT LAKE CITY (7/16/13)--Credit union associates nationwide can wear jeans in support of their local Children's Miracle Network Hospital on Sept. 18.
 
For a $5 donation, employees can participate in Miracle Jeans Day, an annual fundraiser by Credit Unions for Kids for Children's Miracle Network Hospitals. The charity raises funds and awareness for 170 children's hospitals.
 
"Kinecta FCU supports the Miracle Jeans Day campaign because it's a great way to host a nationwide fundraising event while dollars donated stay local to help kids in our community," said Latrice McGlothin, community program manager for the Manhattan Beach, Calif.-based credit union.
 
Free tools, including printable stickers and resources specific for credit unions, to plan and host an event are available at MiracleJeansDay.com. Use the link. New this year is a redesigned website to make registration easier, and a limited-edition T-shirt for credit unions.
 
In 2012, more than 600 credit unions representing thousands of employees participated in Miracle Jeans Day and raised more than $300,000 for member hospitals across 47 states. That total represents a 74% increase over the previous year.
 
The credit union community has been raising funds under the "Credit Unions for Kids" brand since 1996 and has collected more than $110 million for Children's Miracle Network Hospitals.
 
For more information, use the link.