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Patelco: Slashing 39 fees dismantles service barriers

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PLEASANTON, Calif. (7/21/14)--Thirty-nine member service fees erased. Balance transfer: gone. Card replacement: gone. Early mortgage payoff: gone. It's all part of $4.1 billion-asset Patelco CU's mission--to remove any barriers to creating a great experience of banking for its members. And it's a mission driven by Erin Mendez as she closes in on her first anniversary of being president/CEO of the Pleasanton, Calif., credit union.
"We are returning Patelco to its roots of being a credit union that stands behind the credit union member and does what's best for the member," Mendez told News Now .
"The majority of our members are just middle-class people from all walks of life," she said. The fees--which created a "bill environment"--were a nuisance to members and to the staff tasked with collecting them.
The one fee that has been most obvious to members is the plastic card replacement fee, Mendez said. The credit union's branches are equipped with instant issue systems for ATM, credit and debit cards, which means no mailing costs. "That's the one members say, 'Oh my gosh, thank you,' when we can hand them their new card without charging them," Mendez said.
Some might wonder how Patelco will recoup the $800,000 reduction in fee income. Mendez said it will be balanced by deepening the relationships with their members. "We believe in 'banking on trust'--we won't nickel and dime our members," she said.
"To me it's critical to have enriched our members' lives and provide them with service and value," Mendez told News Now . "We are rallying to do the right things for the members."

CU System briefs (07/21/2014)

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  • LANSING, Mich. (7/21/14)-- Michigan Gov. Rick Snyder bestowed the 2014 Corporate Community Leader award on American 1 CU, Jackson, Mich., with $272 million in assets. The award, one of the Governor's Service awards, honors businesses that demonstrate excellent corporate citizenship by giving back to their community ( Monitor July 17). In 2013, American 1 CU's donations and sponsorships totaled more than $100,000, and it hosted 12 annual events, the proceeds from which go to local nonprofits. The credit union also offers a scholarship program for high school seniors in which credit union members donate $25 to skip one month's loan payment. Last year, 15 $1,000 scholarships were awarded to local students. Snyder, second from left, presents the Corporate Community Leader award to board member Terry Krieg, with Mary Culler, director of governmental affairs, Ford Motor Co., left, and Carolyn Bloodworth, board chair, Michigan Community Service Commission, flanking Snyder and Krieg (Michigan Credit Union League Photo) ...
  • ST. PAUL, Minn. (7/21/14)-- The Minnesota Credit Union Network is offering young credit union professionals an opportunity to crash its Fall Leadership Conference Sept. 5-7 in Brainerd ( The Pulse July 16). Members of the league's Crew-- a group of credit union professionals under age 35--will receive an exclusive discounted package, while a limited number will receive a complimentary conference registration ...

Affinity FCU: No fat cats allowed

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BASKING RIDGE, N.J. (7/21/14)--One thing's for sure, when a credit union attacks a bank--an unusual reversal of roles--it's much more humorous.

Affinity FCU, Basking Ridge, N.J., recently rolled out an ad campaign with a fat, selfish cat as the protagonist--a big bank CEO-like kitty who's only concerned with making himself more money at the expense of consumers ( July 18).

In the TV ad, the fat cat asks two advisers rhetorically why they've gotten into banking in the first place.

"We did it to make lots of money so we can afford the Deluxe Kitty Playtime Palace, and this literal mountain of catnip," he answers for them, pointing at both items in his luxurious office.

The idea, the ad's creators say, is to illustrate the stereotypical bank, and remind viewers that credit unions are nothing like that.

As the ad puts it, Affinity is "100% fat cat free."

Tom Christmann, chief creative officer for the ad agency who developed the campaign, DiMassimo Goldstein, puts it another way.

"We wanted to personify that big bank mentality in a way that people would respond to," Christmann told Mashable . "So we thought, 'cat video' plus 'I hate banks' equals 'fat cat,' which might be the algorithm for a viral video."

A second ad in the series will hit airwaves later this summer featuring the fat cat tossing plants off of his desk in a wasteful manner. In addition to cable TV spots, the New Jersey-based campaign also features billboards and will extend to social media, online banners and YouTube.

Also, cat lovers needn't worry, as the star of the campaign isn't really fat, but is wearing a custom-made fat suit. He's also not greedy.

"He's the Robert DeNiro of cats," Christmann said. "He's the sweetest guy."

CFPB's Cordray meets with El Paso area CUs

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FARMERS BRANCH, Texas (7/21/14)--Representatives from the Cornerstone Credit Union League and a group of El Paso-area credit unions last week met with Consumer Financial Protection Bureau (CFPB) Director Robert Cordray and his staff to discuss the impact on credit unions of recent regulatory changes by the agency.
The forum was part of several roundtables in the El Paso area with different groups to discuss issues pertaining to the CFPB's operations ( Leaguer July 18).
 Several credit unions indicated that they would continue to write non-QM loans because members are unable to qualify for loans under the QM rules. Cordray expressed support for non-QM loans, as many lenders have shifted to only issuing QM loans due to perceived risks.
 Cordray also addressed remittance transfers, and how the CFPB believes misinformation about the new requirements convinced many smaller entities to leave the market.  Several of the credit unions indicated that they no longer provide remittance services as a result of the rule, due to vendor issues and possible risk in the error resolution process.
Much of the discussion centered on "pain points" created by the implementation of the Dodd-Frank Act, especially the new ability-to-repay and qualified mortgage (QM) rules. Cordray asked about specific staffing issues at each credit union, and how staffing changes were incorporated into operations. 
Cordray expressed confidence that credit unions could continue to provide remittances under the new rule, and would lend the CFPB's assistance in working with vendors to fix remittance issues.  He stressed the importance of financial service providers participating in the remittance process. Their departure might force members to look to less reliable services for remittances, he said.
Overall, Cordray praised credit unions for their efforts in assisting low-income consumers, especially those in the El Paso area. He encouraged credit unions to continue to be a market leader in providing short-term, small-dollar loans as a preferred alternative to predatory payday lenders. With the CFPB assuming regulatory authority over nonbanking entities, including payday lenders, he also asked that credit unions partner with the CFPB in reporting any abusive practices by these companies.

LSCU shows Costa Rican CUs advocacy in action

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BIRMINGHAM, Ala., and TALLAHASSEE, Fla. (7/21/14)--A contingent of 10 officials from five Costa Rican credit unions and FEDEAC, the Costa Rican credit union trade association, gained insight on effective lobbying and formulating a unified message during a four-day visit with  the League of Southeastern Credit Unions (LSCU) in Tallahassee, Fla.

The Costa Rican visitors also toured the state Capitol, met with the governor's staff and toured three Tallahassee area credit unions.
During the visit to the Florida Capitol, the league showed Costa Rican credit unions how the committee process works and then how the final vote takes place on the floor. While meeting with Gov. Rick Scott's staff, the credit union officials toured the lieutenant governor and governor's offices. They met with Scott's Director of Legislative Affairs Darrick McGhee to learn more about the governor's priorities, the issues facing the state and how the league interacts with government offices.
"The league really wanted to give our Costa Rican credit union partners an upfront look at how we lobby our state lawmakers," said LSCU President/CEO Patrick La Pine. "By showing the Costa Rican officials how we formulate our messages and then having them go to the capitol to see how the process ties together, they gain a better understanding of how a unified message can influence policy."
Discussion during the visit included how the league interacts with the Legislature on behalf of credit unions, how it organizes grassroots campaigns and how it taps credit unions to assist in the lobbying process--all practices the Costa Ricans were looking to bring back to their country.
The three credit unions the group visited were: Tallahassee-Leon FCU, with $43 million in assets; First Commerce CU, with $400 million in assets; and Envision CU, with $279 million in assets. Each stop gave the Costa Rican credit unions an opportunity to see how each credit union takes part in advocacy on the state and national level. Costa Rican credit unions were interested in the U.S. credit unions' technology, specifically mobile banking and remote deposit capture.

Click to view larger image During four day of meetings with League of Southeastern Credit Union, a contingent of Costa Rican credit union representatives meet with members of Florida Gov. Gov. Rick Scott's staff. (League of Southeastern Credit Unions Photo)

First Tech, OnPoint golf outing raises $408K for CU4Kids

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BEAVERTON, Ore. and MOUNTAIN VIEW, Calif.--(7/21/14)--The second annual Dave and Dan Classic, presented by First Tech FCU and OnPoint Community CU, raised a record $408,000 for Credit Unions for Kids, which benefits Children's Miracle Network Hospitals.
The tournament took place at The Reserve Vineyards and Golf Club in Aloha, Ore., July 14.
The golf tournament was created under the leadership of Tom Sargent, former First Tech president/CEO, and is named after NFL Hall of Fame inductees Dave Wilcox and Dan Fouts. This year's edition featured 28 celebrity guests including fellow Pro Football Hall of Famers Ronnie Lott, Mel Renfro and Kellen Winslow.
"This tournament would not have succeeded without the support of our corporate sponsors, credit unions, volunteers and friends of the Children's Miracle Network Hospitals," said Greg Mitchell, president/CEO of First Tech CU, Mountain View, Calif., with $6.6 billion in assets. "Through the years, the tournament has not only given credit unions the chance to collaborate, but to also make a meaningful impact in the lives of others by helping children get out of hospital beds and onto the playground. I'm proud to say we've raised more money this year for Credit Unions for Kids than ever before."
Formerly known as the "Hank and Moose Open," the tournament has raised more than $3 million during the past 14 years to become one of the biggest credit union-sponsored events supporting Credit Unions for Kids, a nonprofit organization under which America's credit unions raise funds for Children's Miracle Network Hospitals.
"The Dave & Dan Classic is an outstanding event and the money raised is a huge benefit to Credit Unions for Kids," said Rob Stuart, president/CEO of OnPoint Community CU, Portland, Ore., with $3.4 billion in assets. "We firmly believe in the credit union philosophy of 'people helping people' and this is one example of how credit unions come together to give back to our communities. We are proud to be involved and support Children's Miracle Network hospitals and the children and their families who benefit from their care."
Said John Lauck, president/CEO of Children's Miracle Network Hospitals: "Our credit union partners never cease to amaze us, and First Tech and OnPoint are no exception. I am honored to be involved with the Dave and  Dan tournament and grateful for the generosity that allows our member hospitals to provide life-saving care to local kids. Donations from this event will directly impact families in the First Tech and OnPoint communities by funding pediatric rehabilitation treatments and cancer research among other critical services, equipment and charitable care."
Tournament proceeds benefit several children's hospitals including the Doernbecher Children's Hospital, Portland, Ore.; Sacred Heart Medical Center, Eugene, Ore.; Seattle Children's Hospital; Oakland Children's Hospital, Oakland, Calif.; and UC Davis Children's Hospital, Sacramento, Calif.

Columbus publication shines spotlight on Ohio's Mercer

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COLUMBUS, Ohio (7/21/14)--Ohio Credit Union League President Paul Mercer sat down with Columbus Business First recently as part of the publication's "People to Know" series on banking, where he fielded various questions about the state of the credit union movement.

Questions ranged from how Mercer got involved with credit unions to how to attract new members to the movement, but much of the conversation centered on the impact that recent decisions made by U.S. lawmakers have had on credit unions.

"How will the Dodd-Frank Wall Street Reform and Consumer Protection Act affect the businesses and individuals who are your clients?" Mercer was asked.

While the legislation was created with good intentions, Mercer answered, "For credit unions, Dodd-Frank is the latest contribution to a serious real-world, street level, Main Street problem: Federal government overreach and regulation is a large and growing cost, burden, limitation and distraction for smaller, community-centered financial institutions such as credit unions and community banks."

When asked about too-big-to-fail banks, Mercer said: "One travesty of financial markets reform is that (the) government took a big swing at the real problem--Wall Street excess, real systemic risk--but mostly missed and landed a blow directly on the chin of smaller financial market players.

"More good intentions leading to laws and rules yielding unintended consequences," he said.

In addition to Mercer, Michael Shafer, CEO of Pathways Financial CU, Columbus, Ohio, with $223 million in assets, will be interviewed for the series.