Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

CU System Archive

CU System

CU Offers Lawmakers Loans In Illinois Budget Stalemate

 Permanent link
RANTOUL, Ill. (7/30/13)--Credit Union 1, Rantoul, Ill., is offering to state lawmakers emergency loans until the state's budget stalemate is resolved. 
 
Gov. Pat Quinn has vetoed lawmakers' salaries until the General Assembly passes a pension overhaul plan (WNIJ July 29). That means they won't get their monthly pay check starting next week.
 
Although serving in the General Assembly is technically a part-time occupation, for some lawmakers it is their sole source of income.
 
Credit Union 1, with $729 million in assets, has membership open to any employee of the state of Illinois, including legislators.
 
Lawmakers can get a 60-day loan worth half their salary at 0% interest, the credit union said.
 
The credit union has offered similar programs for state employees during previous budget disputes.

N.C. League-supported Elderly Abuse Law Signed By Governor

 Permanent link
RALEIGH, N.C. (7/30/13)--North Carolina Gov. Pat McCrory has signed into law Senate Bill 140, a league- and credit union-backed bill that enhances efforts by the state's financial institutions to prevent the exploitation of older adults.
 
"Fraud committed against the elderly is on the rise, and North Carolina's credit unions want to do more to protect seniors," said Lauren Whaley, director of legislative and regulatory affairs at the North Carolina Credit Union League.
 
"This legislation will give credit unions more responsibility to detect and halt fraudulent transactions and at the same time, credit unions could decide what best practices for curbing elder financial abuse are most suited for their membership, Whaley said. 
 
"The league was very engaged in the legislative process to ensure the bill passed this session," she said, adding that it already is planning a training resources workshop with the Consumer Financial Protection Bureau, North Carolina Bankers Association and the state Attorney General's Office.
 
The call for the legislation was a cooperative effort between the league, attorney general's office, State Employees' CU and the bankers association, said the Raleigh-based SECU, the state's largest credit union with $26 billion in assets.
 
The Financial Exploitation of Older Adults law increases the recognition, reporting and prosecution of those who would defraud older or disabled adults by facilitating the collection of records needed to investigate and prosecute scammers.
 
It requires all financial institutions in the state to report to appropriate authorities cases where there is reasonable cause to believe that a disabled adult over 18 or adult 65 or older is the victim or target of financial exploitation, said SECU. The law ensures that no financial institution employee or officer acting in good faith when making a report may be held liable. It also encourages financial institutions to offer older adult members the opportunity to submit a list of trusted persons to be contacted in case of financial exploitation.
 
SECU said it has an emergency contact service in place for members 60 years or older. Other services it offers older members include reverse mortgages, tax preparation services, estate planning essentials program, and a resource library that cover topics such as health care, Social Security, and powers of attorney.

2,090 CUs 'Go Paperless' With CUNA Mutual Group

 Permanent link
MADISON, Wis. (7/30/13)--Nearly 2,100 credit unions signed up for a Go Paperless campaign CUNA Mutual Group offered to help the environment and raise money for the National Credit Union Foundation.
 
Click to view larger image Posing with a check to the National Credit Union Foundation from the "Go Paperless" campaign initiated by CUNA Mutual Group, are, from left: Jennifer Norr, director, CUNA Mutual Group customer operations; Tom Martorana, senior vice president, CUNA Mutual customer operations; Christopher Morris, foundation director of communications; and Chris Roe, foundation board member and senior vice president, CUNA Mutual's corporate and legislative affairs. (Photo provided by CUNA Mutual Group)
The initiative will save 750,000 pages of paper annually--roughly 90 trees--and it generated a $10,450 contribution from CUNA Mutual Group to the foundation.
 
The insurer agreed to donate $5 to the foundation for every credit union that signed up for paperless policy delivery from May 1 to June 30. As a "green" advocate, CUNA Mutual Group launched the campaign to reduce waste, save money and take another step toward environmental sustainability.
 
"We surpassed our goal by getting 2,090 credit unions to sign up for paperless policy delivery, which was 90 more than our target," said Jennifer Norr, director, customer operations. "Although the campaign is over, we encourage our remaining credit union customers to sign up. It's better for our environment, our customers and our company."
 
A CUNA Mutual Group policy package averages 264 pages. With 6,000 credit union policies in force, the total number of printed pages can exceed 1.5 million per year. The company began making policies available online in 2012.

State Regulators Issue Guidance On Indirect Home Loans, Property

 Permanent link
FEDERAL WAY, Wash. and BEAVERTON, Ore. (7/30/13)--State regulators in Washington and Oregon last week issued guidance for state-chartered credit unions on credit union property and manufactured homes, the Northwest Credit Union Association (NWCUA) said.
 
The Oregon Department of Consumer and Business Services (DCBS) released a Permanent Administrative Rule, making permanent a temporary rule it issued in January regarding unimproved credit union property held for future expansion (NWCUA Anthem Recap July 26). The rule aligns Oregon rules with federal regulations issued by the National Credit Union Administration to give state-chartered credit unions parity. State-chartered credit unions have up to six years to partially utilize unimproved property held for future expansion.
 
The Washington Department of Financial Institutions (DFI) released a Division of Credit Unions Bulletin. B-13-11 discusses indirect manufactured home lending and the DCU's expectations for credit unions exploring any new lending program.
 
Washington state-chartered credit unions that are considering making indirect manufactured home lending loans should contact their assigned DCU caseload examiner, said the bulletin. Prior to implementing any such program, DCU representatives want to meet with credit union representatives to discuss the credit union's program and plans.
 
The DFI expects that credit unions entering the indirect manufactured home lending field demonstrate a complete understanding of its product and risk levels, the bulletin said.
 
"The credit union should develop strong policy requirements and procedural guidance to ensure it sufficiently controls the risks associated with the program and that the program is satisfactorily managed and monitored," DFI said.
 
To read the bulletin, use the link.

CU Magazine Features CU Staff Who Go Beyond Duty

 Permanent link
MADISON, Wis. (7/30/13)--An article in the July 2013 issue Credit Union Magazine features two credit union employees who went beyond expectations to track down large sums of cash--and demonstrate credit unions' people-helping-people philosophy.
 
Shirley Gallant, a receptionist at Oxford FCU, Mexico, Maine, found an envelope with $800 in cash inside. When she found the envelope, she was working in the credit union's vegetable garden, which is part of the University of Maine's Harvest for Hunger program.
 
Fortunately, the envelope included a summer camp contract with a name on it. Gallant recognized the name on the form as her friends' son. She contacted the family--and drove to their house to return the money.
 
In another incident, $702 million asset Vantage CU in St. Louis received a message on its Facebook page from a man visiting New York City saying he'd discovered nearly $1,000 in cash in a Vantage-branded envelope.
 
Jenn Cloud, Vantage's social media specialist, shared this message through every channel available, including the local media, in an attempt to find the person who'd lost it. The New York restaurant where the cash was found e-mailed Cloud to notify her that a woman had called in looking for it.
 
Cloud connected Jonathon Glueck, the man who'd discovered the envelope, and its rightful owner, Jennie Guenzler, a Vantage member. He returned the envelope to her with the cash intact.
 
To read the full article, use the link. Also, see News Now related story "Staff at CU in Kansas Thwart Scam vs. 85-year Old."

Mich. League Meets With Governor's Post-Foreclosure Work Group

 Permanent link
LANSING, Mich. (7/30/13)--The Michigan Credit Union League participated in meetings of a governor's work group last week to discuss possible amendments to recently passed state foreclosure-reform legislation. The end goal is to pass any cleanup legislation before the package's effective date in January.
 
The Michigan State Legislature passed several foreclosure-process reform measures during its spring session. Senate Bills 380 and 383, and House Bills 4765 and 4766, backed by the Michigan Credit Union League, repeal the state's 90-day pre-foreclosure workout law upon the upcoming effective date of the new Consumer Financial Protection Bureau's mortgage-servicing regulations. They also provide for a new right of inspection for foreclosed properties after the sheriff's sale and periodically throughout the redemption period (Michigan Monitor July 29).
 
If purchasers find that damage has occurred or is imminent they may commence an early action for summary possession of the property to take it back and extinguish any remaining redemption period.
 
While the bills were passed, the limited time frame at the end of the spring session period did not allow for possible amendments to better define the rights of purchasers and homeowners. Michigan Gov. Rick Snyder requested lawmakers, legislative staff, and interest groups involved in the passage of the original legislation to convene to discuss any necessary or desirable changes to reform laws. 

CU System Briefs (07/30/2013)

 Permanent link
  • YORK, Va. (7/30/13)--A former  U.S. Army solider has waived his preliminary hearing connected to the robbery of Langley FCU earlier this year in April. According to the Daily Press (July 26), Dorman Shaw, 38, will face a grand jury in September after challenging a second charge on using a firearm.  During the robbery, a man passed a note demanding money to the teller, investigators said.  The suspect, later identified as Shaw, moved his jacket enough to display the handgun in his holster but never pulled it ...
  • PROVIDENCE, R.I. (7/30/13)--A man dubbed the "bearded bandit" was sentenced to 6 1/2 years in prison by a federal judge Friday for allegedly robbing nine Rhode Island financial institutions, including Pawtucket CU in East Providence (The Providence Journal July 27). Justin Worley, 34, was known for robbing financial institutions while costumed in wigs, make up and theatrical aids, including a fake beard, to hide his identity. U.S. District Judge William E. Smith, saying Worley terrorized financial institution service representatives across the region,  gave Worley the longest prison term within the range recommended by federal sentencing guidelines. Worley made off with $32,638 in cash during his nine robberies, according to prosecutors ...
  • FEDERAL WAY, Wash., and BEAVERTON, Ore. (7/30/13)--The Northwest Credit Union Foundation has welcomed Carlene Joseph and Jenell Saavedra as its two new board members.  Joseph, from Harborstone CU, will represent District 6. She will serve the remaining two-year-term vacancy from the retirement of Fibre FCU's Lesley Carrell this summer. Northwest Community CU Lending Support Manager Janell Saavedra will represent District 1 during her first term on the foundation board. Saavedra and Joseph officially begin service to the board on Oct. 8 (Anthem Recap July 26) ...
  • SHREVEPORT, La. (7/30/13)--Louisiana Gov. Bobby Jindal announced five appointments Friday, including that of a credit union CEO, to the board of the Caddo Levee District, responsible for maintaining the integrity of the levees and maintaining the levee drainage system within Caddo Parish.  Among those appointed was Helen Godfrey Smith, president/CEO of Shreveport (La.)  FCU  (Shreveport Times July 29) ...
  • FARMERS BRANCH, Texas (7/30/11)--Responding to questions from credit unions in Arkansas, Oklahoma and Texas, the newly merged Cornerstone Credit Union League clarified its selection process for this year's National Awards Program.  The league stated that rather than credit unions from all three states competing against each other at the state level, the league will select a first, second and third place winner from each of the three states. The first place winners will then advance to the Credit Union National Association competition for national judging. (Leaguer July 29).  The competitions include The Dora Maxwell Social Responsibility Community Service Award, the Louise Herring Philosophy in Action  Member Service Award, and the Desjardins Youth and Adult Financial Education Awards ...

Staff At CU In Kansas Thwart Scam Vs. 85-year-old

 Permanent link
OVERLAND PARK, Kan. (7/30/13)--An 85-year-old member of Community America CU-- who wanted to withdraw funds because she was going to be awarded $7 million in prize money and a luxury car--still has her money, thanks to the persistence of a credit union employee who recognized the situation was a scam.
 
Credit union employee Mary Weiss told Fox4KC.com she looked forward to the regular visits of the member, but became suspicious when the woman arrived early to withdraw some funds and said she was about to come into a large amount of money.
 
Weiss told her the deal was a scam, but the woman left. Later she returned, explaining she had bought a card with numbers on the back and needed to give the numbers to some people on the phone.  Weiss told her again that it was a scam.  The woman left again, then returned and asked to withdraw more.
 
"Don't do this, just don't do this," she warned the woman, but the member's mind was set. When she said she was meeting people at her house to hand over the money and get her prize. The credit union employees cautioned her not to let anyone in her house and re-emphasized the danger and the fact it was a scam.
 
Although the credit union had to provide the funds she withdrew, the employees were "all scared for her." A co-worker called police, who caught up with the woman and intervened.
 
The woman's family members told local media they were grateful to Weiss and the credit union for watching out for their mom. The Overland Park, Kan., Police Chief wrote a blog about the incident to remind the public that thieves prey on the elderly.
 
See related News Now stories CU Magazine Features Staff Who Go And Beyond, and N.C. Governor Signs League-supported Elderly Abuse Law.

CU System Briefs (07/29/2013)

 Permanent link
  • WASHINGTON, D.C. (7/29/13)--The Consumer Financial Protection Bureau's (CFPB) recent amendments to clarify the Ability-to-Repay and mortgage-servicing rules, proposed in April and finalized earlier this month, have been published in the Federal Register. The clarifications are meant to address questions that were posed in the months since the rules were first issued in January. CFPB Director Richard Cordray has said that the bureau is "listening closely to feedback" on its rules and these clarifications "show our willingness to make appropriate adjustments" ...
  • LAREDO, Texas (7/29/13)--A former Laredo (Texas) FCU employee, who pleaded guilty to robbing the credit union of $177,000 at gunpoint on Jan. 6, 2012, was sentenced to more than 10 years in prison Thursday in a U.S. District Court in Laredo (Laredo Morning Times July 25).  Asael Cruz's sentence will be followed by a five-year supervised release and150 hours of community service. He will pay more than $7,689 in restitution to the credit union and a custodian whose truck was stolen for the getaway.  The robbery occurred when the suspect confronted a teller who was exiting the building by a rear door. Cruz allegedly pointed a handgun at the victim and ordered him to stay on the floor face down. When the teller couldn't provide a combination to the door, Cruz allegedly grabbed the employee's wallet, checked his driver's license, and called him by name, saying he would keep the license in case anything "goes bad." He bound he man's wrist, ankles and mouth with tape before robbing the credit union ...
  • BELMONT, Calif. (7/29/13)--Belmont, Calif., police arrested Carmen Joseph Polito, 31, a transient, Wednesday in connection with a robbery of Redwood City-based Provident CU Tuesday. Polito was arrested as he walked along a city street. At about 2:30 p.m. Tuesday a man entered the credit union and handed a teller a note demanding money. The teller gave him money from the cash drawer and Polito repeated the process with a second teller, this time demanding the money verbally before fleeing with the money, said Redwood City police. Police recovered money and a demand note during the arrest (CBS San Francisco July 26 and Belmont Patch July 25) ...
  • PORTLAND, Maine (7/29/13)--Richard "Spike" Carey, former long-time director of Waterville, Maine-based New Dimensions FCU, died July 19, according to the Maine Credit Union League (Weekly Update July 29). Carey also served in the Maine Legislature for many years, where he was known as a strong friend of credit unions, the league said. Carey also served as mayor of Waterville in the 1970s ...

NEW: N.C. Governor Signs League-supported Elderly Abuse Law

 Permanent link
RALEIGH, N.C. (7/29/13 UPDATED 2:25 p.m. ET)--North Carolina Gov. Pat McCrory has signed into law Senate Bill 140, a league- and credit union-backed bill that enhances efforts by the state's financial institutions to prevent the exploitation of older adults.

"Fraud committed against the elderly is on the rise, and North Carolina's credit unions want to do more to protect seniors," said Lauren Whaley, director of legislative and regulatory affairs at the North Carolina Credit Union League.
 
"This legislation will give credit unions more responsibility to detect and halt fraudulent transactions and at the same time, credit unions could decide what best practices for curbing elder financial abuse are most suited for their membership, Whaley said. 
 
"The league was very engaged in the legislative process to ensure the bill passed this session," she said, adding that it already is planning a training resources workshop with the Consumer Financial Protection Bureau, North Carolina Bankers Association and the state Attorney General's Office.
 
The call for the legislation was a cooperative effort between the league, attorney general's office, State Employees' CU and the bankers association, said the Raleigh-based SECU, the state's largest credit union with $26 billion in assets.
 
The Financial Exploitation of Older Adults law increases the recognition, reporting and prosecution of those who would defraud older or disabled adults by facilitating the collection of records needed to investigate and prosecute scammers.
 
It requires all financial institutions in the state to report to appropriate authorities cases where there is reasonable cause to believe that a disabled adult over 18 or adult 65 or older is the victim or target of financial exploitation, said SECU. The law ensures that no financial institution employee or officer acting in good faith when making a report may be held liable. It also encourages financial institutions to offer older adult members the opportunity to submit a list of trusted persons to be contacted in case of financial exploitation.
 
SECU said it has an emergency contact service in place for members 60 years or older. Other services it offers older members include reverse mortgages, tax preparation services, estate planning essentials program, and a resource library that cover topics such as health care, Social Security, and powers of attorney.

CUbroadcast Marks 200th Online Video Talk Show

 Permanent link
SAN DIEGO (7/29/13)--Credit union online video talk show CUbroadcast  is marking its 200th episode by interviewing representatives from the Filene Research Institute and Currency Marketing about their CU Water Cooler Symposium show set for Oct. 17-18.

Host Mike Lawson interviewed Filene's Matt Davis and Currency Marketing's Tim McAlpine about Water Cooler, which they describe as an event where passionate credit union folks can listen and exchange ideas at a high level. To view the interview, use the link.

The Web-based credit union talk show was launched in November 2010. Twice a week it posts interviews discussing credit union issues and trends. Among those who have been guests on the show are National Credit Union Administration Chairman Debbie Matz and Credit Union National Association President/CEO Bill Cheney.

"I have met so many fantastic folks in this industry who are incredibly humble and passionate about their cause," Lawson said. "It's a very refreshing escape from other industries. Credit union people are so eager to tell their story--and that's what makes everybody so compelling to talk to."

During the second half of the year,  CUbroadcast has plans to make the show more attractive to watch and will add features to provide more information, he said.

CUs Test the Waters Of State Small Business Credit Initiative

 Permanent link
MADISON, Wis. (7/29/13)--A few credit unions have carefully tested the waters of a federal program that helps financial institutions extend loans to small businesses that are creditworthy but do not meet standard lending criteria.
 
On Sept. 27, 2010, President Barack Obama signed into law the Small Business Jobs Act of 2010. The act created the State Small Business Credit Initiative (SSBCI), which was funded with $1.5 billion to strengthen state programs that support lending to small businesses and small manufacturers.
 
The initiative will allow states to build on successful models for state small business programs, including the collateral enhancement program, capital access program loan guarantee program. 
 
Representatives from credit unions that participate in the SSBCI programs note that they aren't likely to attract a windfall of new member business loans, but they can solidify relationships that might otherwise be lost.
 
"We see these kind of programs as a benefit of membership," Robert Myles, senior vice president of lending and retail services at Telhio CU, Columbus, Ohio, told News Now. Telhio has made three loans totaling roughly $1.1 billion through the SSBCI's collateral enhancement program.
 
Prior to 2012 credit unions were not previously eligible to participate in the program because they could not accept public funds. The Ohio Credit Union League secured an agreement with the Ohio Department of Development to allow credit unions to participate in the state's SSBCI (News Now June 19, 2012.
 
Eligible federally insured credit unions can participate without taking deposits of public funds. A credit union still must guarantee 30% to 50% of the loan as a collateral shortfall, enter into a collateral enhancement agreement for credit unions, and meet reporting and other requirements.

"Basically what the state does is set aside a deposit for that amount as insurance, so if we had a default it would pay after liquidation up to that amount," Myles told News Now.
 
In Wyoming, Mich., My Personal CU, with $110 million in assets, has entered into one loan deal through the Michigan Economic Development Corp. collateral support program. The credit union provided a loan to a manufacturing company that was hit hard by the economic downturn.
 
"We worked with them and were coming short on collateral because back then the appraisals were pretty anemic, but since then they've been from the program," said William Seniura, My Personal CU business lending specialist. "We still have loans with them.
 
"These are not catch-all programs, but they work when it's appropriate," Seniura added. "They don't turn a bad deal into a good deal. They allow us to make a deal that everybody thinks is a good deal or will shortly be a good deal, but is missing one or two components of our credit analysis that is making it hard to get approved. It enhances the loan."
 
Credit unions maintain they can do even more for small businesses if the cap on their member business loans (MBLs) were lifted. In Congress, separate House (H.R. 688) and Senate (S. 968) MBL bills have been introduced to increase credit unions' MBL cap to 27.5% of total assets from 12.25%. The Credit Union National Association has estimated that lifting the MBL cap would create 140,000 jobs and inject $13 billion in new funds into the economy, at no cost to taxpayers.

Equifax: Delinquency Rates Continue To Decrease

 Permanent link
ATLANTA (7/29/13)--A turnaround in home pricing trends is a factor on the improvement of consumer payment behavior and delinquencies in all major areas--except student loans--for the first half of 2013, reports Equifax in its latest National Consumer Credit Trends Report, released Friday.
 
The trend mirrors the trend in credit unions. Overall loan delinquencies reported by credit unions in May were 1.14% of loans, compared with 1.17% in April, 1.2% in March, 1.21% in February and 1.18% in January, according to the Credit Union National Association's Credit Union Monthly Estimates for May 2013, the latest information available.
 
The Equifax data reflect that the biggest improvement was in the home finance arena, with year-over-year serious delinquency rates (90-days or more past due or in foreclosure) declining sharply as a percentage of total balances outstanding:
  • First mortgage delinquencies decreased more than 27%--to 4.14% from 5.70% ;
  • Home equity revolving decreased nearly 24%--to 1.75% from 2.30%; and
  • Home equity installment decreased more than 20%--to 3.31% from 4.16%.
Year-over-year changes in the 60-day-plus delinquency rates for other loans also decreased for bankcards, which dropped more than 16%--to 1.82% from 2.17%, and for auto loans, which decreased more than 11%--to 1.09% from 1.24%.
 
"The turnaround in home price trends over the past year is having a substantial impact on mortgage delinquency rates," said Equifax Chief Economist Amy Crews Cutts. "As more and more homeowners find themselves back in positive equity, the incentive to default is strongly tempered."
 
She noted that performance in other sectors is improving with the gradual economic recovery, but "we are seeing a strikingly different trend with student loan debt, which is both the fastest growing consumer debt segment and the only segment in which we're seeing rising severe delinquency rates and accelerating write-off rates."
 
Other results for home equity revolving, bankcards, auto and student loans are listed below.
 
Home equity revolving:
  • The total balance of new credit opened from January to April increased more than 17%  to $24.1 billion, compared to the $24.1 billion for the same time period in 2012;
  • The total number of new loans also increased more than 11%, to 297,600 from 266,600; and
  • Both new loans and new credit year-to-date in April are four-year highs.
Bankcard:
  • At $62.3 billion, the total limit of new credit issued between January and April is a five-year high for that period and an increase of 74% over the recession low of $35.8 billion for the same time during 2010;
  • The total number of new loans year-to-date in 2013 is 13.2 million, a five-year high for that period and an increase of more than 6% from the 12.4 million for the same period one year earlier; and
  • Compared to $58 billion the first four months of the year in 2012, the year-to-date total limits of new credit increased more than 7%, to $62.3 billion.
Auto:
  • The total balance of new credit issued January-April is $152.7 billion, an eight-year high for that period and an increase of more than 13% from January-April 2012;
  • Year-over-year, total outstanding balances rose more than 9% to $816.4 billion in June 2013 from $745.1 billion in June 2012;
  • The total number of new loans year-to-date in April 2013 increased more than 10% from the a year earlier--to 7.7 million from seven million; and
  • By source, bank- funded auto loans rose more than 19% year-over-year for the first four months of 2013 to $76.9 billion from $64.3 billion, while auto finance company-funded loans were up more than 8%, to $75.8 billion from $70 billion.
Student Loan:
  • The total balance of loans outstanding increased year-over-year more than 11% to $880.3 billion from $791.2 billion in June 2012;
  • New credit year-to-date in April totaled $19.3 billion, an increase of nearly 14% from the period a year earlier; and
  • Conversely, the total number of new loans originated during this same time decreased 1.9%, from 3.4 million to 3.3 million, a five-year low for the first 4 months of the year.

CUNA, CUs Participate In Freddie's Credit Risk Sharing Meeting

 Permanent link
McLEAN, Va. (7/29/13)--Freddie Mac Friday announced that a new synthetic type of agency mortgage-backed security (MBS) that could decrease taxpayer exposure in the mortgage market was ready for trading. The Credit Union National Association was present and participated in the briefing to ensure that credit unions were represented.
 
The $500 million offering of Structured Agency Credit Risk (STACR) Debt Notes, Series 2013-DN1, was priced Tuesday and scheduled to settle Friday. STACR debt is the first in a series of such offerings. The securities would, in essence, offload a portion of the risk of certain government-guaranteed MBS into the investors in private capital markets. The STACR bonds, originally scheduled to be $400 million but increased to $500 million due to investor demand, were purchased by a number of investors, including credit unions, according to Freddie Mac.
 
"This is a novel structure for mortgage-backed securities that could reduce the taxpayer's exposure and risk," said Robin Cook, CUNA assistant general counsel for special projects. "It is an interesting way to bring more private capital into the mortgage marketplace without legislation."
 
STACR debt notes are different than other Freddie Mac securities and debt issuances. Under the STACR structure, the amount of periodic principal and ultimate principal paid by Freddie is determined by the performance of a large and diversified reference pool of more than 96,000 loans, representing a $22.5 billion residential mortgage loan balance. This pool consists of a subset of 30-year, fixed-rate, single-family mortgages acquired by Freddie Mac in the third quarter of 2012.
 
Freddie retains control of the servicing of the loans in the reference pool, which allows the loans to follow Freddie's loss mitigation practices and programs. Freddie also retains a share of losses on every loan in the reference pool, ensuring that its incentives are aligned with investors.

"Treasury believes these efforts are an important step to increasing private sector participation in the housing finance sector," said Michael Stegman, counselor to the Secretary for Housing Finance Policy Friday. "This tool helps protect the interests of the American taxpayer, with private capital taking the predominant credit loss--aligning with the administration's goal of reducing the government's footprint in the mortgage market."

Fraudulent Transactions Reported By CUs In Several States

 Permanent link
MADISON, Wis. (7/29/13)--Credit unions and banks in four states--California, Missouri, Michigan and Montana--have reported fraudulent transactions involving consumers' accounts or attempts to capture personal financial information.
 
Santa Rosa, Calif.-based Redwood CU is reissuing 18,400 debit cards for members whose information may have been stolen in a cyber attack that targeted the Raley's supermarket chain's Bel Air and Nob Hill stores.
 
Redwood is one of several area financial institutions whose members/customers' information was compromised (The Press Democrat July 26). As of Thursday, Redwood had confirmed 200 fraud-related cases from the Raley's stores.  Raley's operates 115 stores in California and 13 in Northern Nevada.
 
One member reported a $500 fraudulent transaction by someone at an ATM in Las Vegas. He said the credit union refunded the amount stolen and issued him a new debit card on the spot.
 
Olivette, Mo., police say that a credit union's surveillance camera has caught photos of a woman believed to be the person who stole debit cards during smash-and-grab burglaries and used them at least four times at drive-up tellers at two locations of Bridgeton, Mo.-based Vantage CU (KSDK July 25). The woman, wearing the same clothes and driving the same car each time, struck twice on July 15, once on July 16, and again on July 17. The debit cards were stolen from cars in other cities, said police.
 
The woman was almost caught last week, when she tried to use a flagged account and the teller called 911. She got away before police arrived. It was not clear whether she is conducting the burglaries or if she has accomplices.

Two credit unions in Marquette, Mich., reported that signature-based card transactions have been blocked due to fraud, said UpperMichiganSource.com (July 26). The Marquette Community FCU and the U.P. Catholic FCU reported Friday afternoon that members' transactions were blocked in response to recent fraud detected in the Detroit area.  Pin-based transactions still work, said Marquette Community FCU.

In Missoula, Mont., Ravalli County residents received text messages that said their debit card account at a local bank had been locked and they would need to provide their account number to unlock it (KECI.com July 24).
 
Credit unions and banks warned consumers they do not contact recipients asking for account numbers, since they already have the numbers. They also urged consumers to delete and not respond to texts, e-mails, or phone calls seeking that information.

Archbishop's 'War' On Payday Loans Shines Spotlight On CUs

 Permanent link
LONDON (7/2913)--Calling them a "financial cancer," the Archbishop of Canterbury has declared war on payday lenders in the United Kingdom by creating a credit union for clergy and members of the Church of England and Church of Scotland. The result: a media frenzy of bad publicity for payday lenders and good publicity for credit unions.
 
The coverage didn't quite rival the media hullabaloo over the birth earlier in the week of Prince George, but on Friday News Now counted 35 articles and broadcasts about the battle of  (Archbishop Justin) Welby vs. Wonga, Britain's major payday lender.
 
Most mentioned the credit union he formed earlier this month.  Articles ran in the BBC, The Telegraph, Yahoo! News, Financial Times, The Independent, The Scottish Sun, Oman Tribune, and Fiji Times, among others. The BBC's item was headlined, "What are credit unions and how can you use them" (July 26).
 
The church's move has raised awareness about the benefits of credit unions, said the Association of British Credit Union Leagues (ABCUL) Friday, in welcoming the archbishop's support.
 
"The wide community reach of the organization and the skills within its congregations mean it is one of many groups that can help raise awareness of the benefits of credit unions and help them to grow," said ABCUL CEO Mark Lyonette (ccrmagazine.com July 26).
 
He added ABCUL will be "talking to the Church of England about how this can be achieved. People in their congregations and communities of all incomes will benefit from the great value services credit unions provide. And the more people who use credit unions, the more successful they will be."
 
Meanwhile, the CEO of payday lender Wonga said he welcomed the competition. He made the comment after Welby told him that the Church of England would help credit unions force the firm out of business (BBC July26).

Altura CU Reports Ninth Quarter Gain On Net Income

 Permanent link
RIVERSIDE, Calif. (7/29/13)--Altura CU in Riverside, Calif., Thursday reported net income of $3.47 million on total assets of $704.6 million for the second quarter. It is Altura's ninth consecutive quarter of net gain.
 
"We continue to see slow and steady improvement in the local economy and that has a positive impact on Altura's bottom line," said Altura CEO Mark Hawkins. "We had a great second quarter this year, the second best total in our history. Things are on a slow, yet improving, trajectory."
 
Net income for the first half of 2013 was $8.45 million, compared with $11.07 million for the same period in 2012. Altura also reported a net worth ratio of 10.82% for the second quarter, up from 8.69% for the same period last year. That figure is also up from the first quarter of 2013, when Altura reported a net worth ratio of 10.13%.
  
Altura is part of the Inland Empire, an area about 60 miles east of Los Angeles. The Inland Empire economy continues to improve at a slow, but steady pace. Unemployment is still the biggest drag on the local economy, holding at 10.2%, Altura said. Although still above national and state unemployment rates, the current figure is an improvement over the 15.4% reported at the height of the recession in July 2010.
 
The Great Recession hit the Inland Empire hard and impacted Altura's financials.  Since then, the credit union has been steadily strengthening.
 
"The market is healing. In fact from a credit quality perspective, you could even say it has healed," Hawkins said. "The number of delinquent loans is down substantially, enabling us to reduce the amount set aside for loan loss provisions from $25.2 million in June 2012 to $15.7 million this year.
 
"However, people in our community remain understandably cautious," he added. "Their wariness is holding back loan growth, a major contributor to Altura's income. As the market continues to stabilize, we hope to see more job growth and marketplace productivity."
 
Revenue growth is up compared to projections, particularly for non-interest income and investment income, Hawkins said.
 
"Members' discretionary spending has been steady, and they are using their debit and credit cards more," he added. "As a result we have seen an uptick in interchange income. With economic improvements, people are also investing more, boosting that income stream as well."

Patronage, Loyalty, Dividends Topic of Filene Report

 Permanent link
MADISON, Wis. (7/29/13)--At the base of a member's credit union relationship lies the promise of surplus--whatever a credit union earns in excess of its expenses is to be used on behalf of or returned to members, says a new Filene Research Institute report.

Beyond deposit-based dividends, members extend implicit flexibility to boards and managers about how that shared surplus should be used, said the report, "Patronage, Loyalty, and Credit Unions' Shared Surplus," by Daniel Cote, a professor at HEC Montreal.

Most members don't think of the surplus as theirs, because most credit unions don't talk about it that way. However, credit union leaders, as stewards, should think about that surplus and how it should be used to grow, to deliver value to, and to strengthen the cooperative, said Filene.

The report was produced in partnership with Credit Union Central of Canada, and challenges readers to consider how practices like patronage dividends, incentive programs, and strategic use of the surplus can engender loyalty and strengthen the credit union.

The first part examines the academic research behind loyalty, including Cote's own thinking about how a "new cooperative paradigm" can invigorate credit unions that cultivate loyalty.

The second part analyzes how three Canadian and three U.S. credit unions use their surpluses--in very different ways--to return value to members.

The report says the implications for credit unions are:
  • Shared surplus is a productive way to think about member value, economic or otherwise. The simplest way to return shared surplus is in extraordinary dividends, but just as valid are the approaches where the surplus is deliberately reinvested in a layered loyalty program that promotes patronage or even in a service delivery model that reinforces the brand.
  • Credit unions should pay more than lip service to loyalty. In a competitive environment, credit unions have a strategic advantage of being able to use surplus profits in a way that generates loyalty. Loyalty programs from both the literature and the report's case studies serve the needs of members and of the credit union as an institution. Members benefit from an improved value proposition, while the credit unions improve their competitive position and create incentives that are good enough to change the behavior of their members without eroding their profit margins.
  • Rewards-based loyalty programs are not costly to operate. The main component of the budget to set up and maintain such a program is tied to the cost of rewards themselves. More salient are the design behind the program and how a patronage- or loyalty-based program will encourage deeper interaction with the credit union. Some of the case studies describe large, sophisticated credit unions, but others show that being small does not prevent running effective loyalty or rewards programs.
To access the report, use the link.

CU System Briefs (07/26/2013)

 Permanent link
  • DES MOINES, Iowa (7/26/13)--A man and a woman have been charged with confiscating a bag of money that fell off an armored van Wednesday as it left Johnstown, Iowa-based Community Choice CU (Associated Press July 24). Samantha Jackman of Des Moines and Tyler Critchlow of Dallas Center, both 20, were arrested and charged with first-degree theft after their car was found in a shopping mall parking lot. The bag fell out after a door malfunctioned as the armored van turned a corner. A car stopped and someone picked up the bag and fled. Police tracked the car through its license plate to a shopping mall parking lot ...
  • ST. LOUIS (7/26/13)--A bag of money found Wednesday on Highway 40 in St. Louis is believed to be the loot from a robbery of a credit union earlier that morning (South County Times and Associated Press via The Sacramento Bee July 24). A man entered First Missouri CU on Lemay Ferry Road in St. Louis at about 10:16 a.m. and escaped in a small to mid-size yellow Chevrolet.  He did not display a weapon and no one was injured, said police. About 15 minutes later, drivers on Interstate 64 reported seeing a bag tossed from a yellow Chevrolet. Police recovered a "substantial amount" of money and are searching for the suspect ...
  • BALTIMORE  (7/26/13)--Johns Hopkins FCU introduced two new Visa credit cards to its products lineup, and as of June 30, it has opened more than 1,500 cards, including 784 Visa Credit Cards, 538 Visa Platinum Credit Cards and 246 Visa Platinum Rewards Credit Cards, the Baltimore-based credit union reported. After a "soft" rollout in December, the credit union began promoting the cards heavily last spring. The Platinum card offers a non-variable rate as low as 7.9% Annual Percentage Rate (APR), while the Platinum Rewards card offers a rate as low as 9.4% APR. Both cards have no annual fee, no balance transfer fee and no minimum finance charge, and they offer online account access and free e-statements. Rewards card members earn points for every purchase, excluding balance transfers and cash advances, and redeem the points for merchandise, trips, tickets, gift cards and more ...
  • HARRISBURG, Pa. (7/26/13)--Pam Stein has been named director of education and professional development at the Pennsylvania Credit Union Association, PCUA announced Thursday (Life is a Highway July 25). She will oversee PCUA's education and training efforts for credit union professionals and volunteers. Stein previously worked for the Harrisburg Area Community College as marketing and sales manager of the Wildwood Conference Center ...

CUs Collaborating More On Back-Office Ops

 Permanent link
RALEIGH, N.C. and WARRENTON, Va. (7/26/13)--Unlike banks, credit unions often collaborate to offer better service to their memberships. Two recent examples of how large credit unions are helping smaller ones can be seen in North Carolina and Virginia.
 
In North Carolina, State Employees' CU (SECU), with $26 billion in assets and based in Raleigh, N.C., will provide full back-office support to help Greater Kinston (N.C.) CU minimize operational expenses and focus on strengthening and revitalizing its efforts for creating growth opportunities.
 
The conversion to SECU's systems and services will provide the platform to enhance the $11 million asset GKCU's full service offering of member products and services with greater convenience and accessibility, the credit unions said. 
 
"SECU's expertise, proficiency, and standard have made them the proven-leader of the credit union movement in our great state," said Shawn Wilson, GKCU manager/CEO. "With their assistance and support, GKCU will be able to focus more on servicing membership, community outreach and expanding awareness to the surrounding communities within our field of membership." 
 
SECU provides similar operational services to the Durham-based Latino Community CU, which has $128 million in assets.
 
Greater Kinston CU is one of the last three African-American credit unions in North Carolina continuing to primarily serve its demographic member population. 
 
In Virginia, $246 million asset Partners 1st FCU and $21 million asset Northern Piedmont FCU have forged a partnership based on each credit union's needs.
 
Partners 1st FCU is based in Fort Wayne, Ind., but has offices throughout the East Coast due to mergers and community development expansion.  Most recently, the credit union sought to expand into the Culpeper, Va., area. 
 
Northern Piedmont FCU, Culpeper, Va., has offices in Culpeper and Warrenton serving several select employer groups and representatives.
 
In June, Northern Piedmont FCU informed Partners FCU that it was streamlining its operation by concentrating on branches in Warrenton and leaving the Culpeper area. Since there were no other credit unions in the immediate vicinity, North Piedmont representatives inquired if Partners 1st would be interested in a business venture that would allow Partners 1st to expand into the area and assist Northern Piedmont in ensuring that its members continued to have credit union products and services as a financial option. 
 
"To streamline our operation, we made the decision to concentrate on Fauquier County," said Dortha Johnson, Northern Piedmont, president. "That's where we began, but it was extremely important to us that our Culpeper members continued to be served by a credit union and Partners 1st was the logical choice."
 
Partners 1st is now in the process of buying Northern Piedmont's building in Culpeper.  To make the transition easier, the credit unions will share the building for about two months. Northern Piedmont's business development representative is introducing Partners 1st representatives to North Piedmont's employer and community contacts.
 
Partners 1st will add five jobs to the area during the next few months and also will expand office hours.

Dakota CUs Deliver: More Than 33,000 Don't Tax Messages Sent

 Permanent link
BISMARCK, N.D. (7/26/13)--
Click to view larger image Credit Union Association of the Dakotas staff donned their "Don't Tax" t-shirts and gathered for a group photo with some of the 12,821 postcards that are going to the offices of U.S. Rep. Kevin Cramer (R-N.D.)and Sens. Heidi Heitkamp (D-N.D.)  and John Hoeven (R-N.D.). From left are: Norita Kress, Deb Kruckenberg, Jeff Olson, Steve Rahrich, Shawn Brummer and CUAD President/CEO Robbie Thompson. (Photos provided by the Credit Union Association of the Dakotas)
North and South Dakota Credit Unions presented more than 33,000 "Don't Tax My Credit Union" postcards to the Dakotas' legislators in Congress as of Thursday, said the Credit Union Association of the Dakotas.
 
The number is "a conservative estimate," said CUAD.
 
"While we are still working on complete numbers as we continue to get information from credit unions, we presently have counted that North Dakota as delivered 12,821 postcards while South Dakota has delivered 20,701," reported CUAD President/CEO Robbie Thompson.
 
Click to view larger image South Dakota credit union representatives--Jay Kruse of Service First FCU, Darla Erb of Voyage FCU and Joey Rotert of Sioux Falls FCU--delivered postcards directly to the offices of U.S. Rep. Kristi Noem (R-S.D.) and Sens. John Thune (R-S.D.) and Tim Johnson (D-S.D.). They are shown here at Sen. Johnson's office.
"As long as we have postcards left, we hope to keep them trickling in so our elected representatives know that we are passionate about this issue, and that we aren't going away," said Jeff Olson, CUAD vice president of advocacy and awareness.
 
Olson added he hopes credit unions will continue to send the post cards with their outgoing mail until the supplies run out.
 
Leagues across the nation are in the process of tallying up the results so far of their state's grassroots efforts aimed at sending the Don't Tax My Credit Union message to Congress.
 
The message was delivered loud and clear Tuesday to more than 875,397 people, including members of Congress and their followers on Twitter during the Credit Union National Association's DontTaxMyCU Tuesday national grassroots campaign.
 
Roughly 2,171 tweets specifically mentioned a member of Congress' Twitter handle and the #DontTaxMyCU hashtag. Another 500 messages tweeted the hashtag without mentioning a specific legislator.
 
Two members of Congress--Rep. Lloyd Doggett (D-Texas) and Rep. David Scott (D-Ga.)--joined in and tweeted their agreement with the Don't Tax My Credit Union message.
 
Members can go to CUNA's www.DontTaxMyCU.org site and send an e-mail to Congress. For more information, use the links.

CU's Goal: Reach Out To Those Without Basic Financial Literacy

 Permanent link
SAN ANTONIO (7/26/13)--Select FCU (SFCU) in San Antonio is using its community roots to meet its primary goal of reaching out to people who lack basic financial literacy skills.
 
When staff of the $32 million asset credit union attended a meeting of 75 parents at a local elementary school and asked parents who had a basic checking or savings account, they were surprised only six people raised their hands, Belinda McDaniel, SFCU CEO, told mysanantonio.com (July 22).
 
In reaching out to members--many of whom live from paycheck to paycheck--the credit union tries to steer members clear of predatory creditors such as same-day lenders who charge 400% interest on their loans, with payment due when the borrower's next paycheck arrives, McDaniel told the publication.
 
SFCU said it is developing an alternative to same-day payday lenders who take advantage of its members.
 
The alternative product will feature a greatly reduced interest rate of 28%, a four-to-six month repayment period and fewer fees, McDaniel told the publication.  
 
SFCU also tries to be a more useful alternative to large banks. Its employees perform community service such as helping with fundraisers, painting houses and setting up tables at fairs. Roughly nine out of 10 of its employees are bilingual, speaking English and Spanish.

Filene Adds Three To Research Council

 Permanent link
MADISON, Wis. (7/26/13)--The Filene Research Institute Wednesday announced the addition of three new members to its research council.
 
The research council's 38 members help plan the organization's research topics, volunteer to pilot Filene innovations at their credit unions, and work with Filene's outside researchers to provide access and insights to the credit union system.
 
"When searching out new candidates for the research council, we look for credit union leaders with a clear track record of innovation," said Mark Meyer, Filene CEO. "These three leaders play integral roles in continuing the advancement of the credit union movement. There's no better way for us to set and adjust our research agenda than by doing it with those who will use the research."
 
New members of the council include:
  • Linda Bodie, chief + innovator at Element FCU, Charleston, W. Va. Since joining Element in 1998, Bodie developed processes such as digitizing 99% of the credit union's paper, streamlined business processes with technology, and implemented electronic check deposit services. She also co-developed and deployed the world's first remote-deposit capture iPhone app.
  • Bob Morgan, CEO, NorthCountry FCU,  Burlington, Vt. Morgan joined the credit union in 2000 as a branch manager, working his way to vice president of lending and administration, executive vice president and then CEO in 2012. Morgan also served on the Association of Vermont Credit Unions' board, as chair of the association's social responsibility committee and government relations committee. Morgan is a Filene i3 alum.
  • Eileen Rivera, president/CEO, SkyOne FCU, Hawthorne, Calif. Rivera has worked at SkyOne FCU for 25 years, including 20 years as the president/CEO. She is on the California Credit Union League's board, serving as chairman in 2011 and was on the association's search committee to hire the league president. She also serves on the RMJ Foundation's board, which promotes financial literacy, and as vice chairman of the Credit Union Advisory Board for the Children's Hospital Los Angeles. Rivera is a member of the Credit Union National Association awards committee.

Five Indicted In Biggest Card Theft Scheme In History

 Permanent link
NEWARK, N.J. (7/26/13)--Five men--four Russians and a Ukrainian--have been indicted in a U.S. court in Newark, N.J., as conspirators in a worldwide hacking and data breach scheme that targeted major corporate networks, stole more than 160 million credit and debit card numbers, and resulted in millions of dollars in losses in what authorities called "the largest such scheme ever prosecuted in the U.S."
 
Many of the victims included credit union members--and credit unions themselves, who bore the costs of replacing members compromised credit and debit cards accounts and fraudulent charges on those accounts. Financial institutions, credit card companies and consumers suffered hundreds of millions in losses, including $300 million reported by three of the corporate victims, said a press release.

The group charged is allegedly responsible for breaches of Hannaford Brothers, Heartland Payment Systems, NASDAQ, 7-Eleven, Carrefour, JC Penney, Wet Seal, Commidea, Dexia, JetBlue, Dow Jones, Euronet, Visa Jordan, Global Payment, Diners Singapore and Ingenicard, according to U.S. Attorney Paul J. Fishman, who announced the charges Thursday with representatives from the U.S. Secret Service and Department of Justice. NASDAQ's trading platform was not impacted.
 
Charged are:
  • Vladimir Drinkman, 32, of Sykatyykar and Moscow, Russia;
  • Alexandr Kalinin, 26, St. Petersburg, Russia;
  • Roman Kotov, 32, Moscow,;
  • Mikhail Rytikov, 26, of Odessa, Ukraine; and
  • Dmitriy Smilianets, 29, of Moscow.
Drinkman and Kalinin allegedly specialized in penetrating network security and gaining access to corporate victims' systems. Kotov, also a hacker, allegedly specialized in mining the networks Drinkman and Kalinin allegedly compromised to steal data. Rytikov provided the anonymous Web-hosting services where the hackers hid their activities, and Smilianets sold the information stolen by the others and distributed the proceeds, said the U.S. Attorney's Office.

Kalinin and Drinkman were previously charged in New Jersey as "Hacker 1" and "Hacker 2" in a 2009 indictment that charged Albert Gonzalez, 32, of Miami with five breaches including the Heartland Payment Systems Inc. breach, which at the time was the largest ever reported. Gonzalez is serving a 20-year prison sentence.
 
Kalinin also is charged in the NASDAQ hacking and is charged, along with another Russian hacker, Nikolay Nasenkov, in an international scheme to steal bank account information by hacking U.S.-based financial institutions.
 
Drinkman and Smilianets were arrested in the Netherlands. Smilianets was extradicted in September and remains in federal custody. Drinkman is still in the Netherlands awaiting extradition proceedings. Kalinin, Kotov and Rytikov remain at large.

For the actual charges and maximum potential penalties, use the link.

NCUA Files Appeal In Goldman Sachs RMBS Lawsuit

 Permanent link
LOS ANGELES (7/26/13)--The National Credit Union Administration filed a notice of appeal Monday in its lawsuit against Goldman Sachs over residential mortgage-backed securities (RMBS) in the U.S. District Court for the Central District of California-Western Division in Los Angeles.    
 
A federal judge in Los Angeles July 12 ruled NCUA waited too long before filing some of its claims against Goldman Sachs over $491 million in losses from RMBS sold to U.S. Central FCU and Western Corporate FCU, which no longer exist (News Now July 16).
 
U.S. District Judge George Wu granted NCUA's request for an interlocutory appeal, or an appeal on certain issues while other aspects of the case are still pending. This sends the case to the Ninth Circuit Court of Appeals on the question of whether NCUA's federal claims are time-barred, or whether an "extender statute" applies that NCUA argues would make the claims still valid. Judge Wu's decision did not dismiss NCUA's state-based claims, which will still move forward.
 
NCUA and Goldman continue to dispute the scope of the appeal and what happens to the remaining claims in the district court while the case is on appeal. NCUA and Goldman have both filed papers with Judge Wu this week regarding these issues. 
 
In the suit, the agency noted that U.S. Central and WesCorp purchased 21 RMBS from Goldman Sachs, which also acted as the underwriter (News Now July 16).
 
The Tenth Circuit Court of Appeals in Kansas also is reviewing the time-barred issues in a separate suit NCUA filed against RBS Securities.

FBI Search Still On For CEO Of Shuttered CU

 Permanent link
SOLON, Ohio (7/25/13)--The search is still on for the missing former CEO of the defunct Cleveland-area credit union, Taupa Lithuanian CU, which regulators shuttered on July 15.
 
The Federal Bureau of Investigation Wednesday released an updated photo of Alex Spirikaitis, who is wanted for "false credit institution entries" related to the collapse of the $23.6 million asset credit union (Cleveland.com July 24).
 
He was believed to be holed up in his home in Solon, Ohio, after authorities tried to serve an arrest warrant at his home on July 16. After what they thought was a 12-hour standoff with Spirikaitis barricaded in the home, the FBI discovered he was not there.
 
The FBI said Spirikaitis uses several aliases, including Michael R. Hess, Rudy Hess, and Richard Spirikaitis, and that he is considered armed and dangerous. The bureau is offering a reward for tips leading to his capture and prosecution, and said he could be headed to Canada.

CU System Briefs (07/25/2013)

 Permanent link
  • TULSA, Okla. (7/25/13)--66 FCU in Tulsa, Okla., has changed its name to Truity CU, the $635 million asset credit union announced Wednesday (BartlesvilleRadio.com July 24).  The new name reflects the credit union's 74-year foundation of trust and integrity, and will help it position itself for future growth and financial strength, President Kelly Diven told the station.  Founded in 1939 to serve Phillips Petroleum Co. employees and their families,  the credit union serves not only Conoco Phillips and Phillips 66 employees and their families, but those of other groups. Although it is already using its new name, Truity CU will convert to a new website during the next three to four months ...
  • PITTSFIELD, Mass. (7/25/13)--Greylock FCU has committed $50,000 over five years to support a senior nutrition program--Meals on Wheels--for Elder Services of Berkshire County.  Greylock's pledge will steer $10,000 annually from 2013 through 2017 to the program and will enhance the program's funding stability, said Greylock President Marilyn L. Sperling.  "This continuing commitment demonstrates Greylock's mission of strengthening  the community we serve," she said. The program provides more than a quarter million meals for Berkshire County seniors, and a thousand meals a day each Monday through Friday, said Elder Services Executive Director John Lutz. Pictured are, from left: Greylock's Karen Reilly and Victoria May; Lutz; and Greylock's Sperling and Executive Vice President John Bissell.  (Photo provided by Greylock FCU) ...
  • EAU CLAIRE, Wis. (7/25/13)--Royal CU  has advanced to the second round of the Social Madness National competition sponsored by The Business Journals. The competition measures a company's social media engagement.  The Eau Claire, Wis.-based RCU moved through the Minnesapolis/St. Paul, Minn., local round, then advanced to round one of the nationals. It is competing in round two in the national competition's medium category. Twenty companies in each of the small, medium and large company categories advanced in this week's round, which ends Monday.  In round tree, the top eight companies in each category compete in a bracket-style completion that begins Wednesday. The final round will end Aug. 19, with a national winner announced by Aug. 20. Three national winners will receive $10,000 to donate to the charity of their choice. To vote for RCU, log on to http://www.bizjournals.com/bizjournals/socialmadness. If RCU wins, it has pledged $10,000 to Gillette Children's Specialty Healthcare through Children's Miracle Network Hospitals ...
  • SPRINGFIELD, Ill. (7/25/13)--Heartland CU President/CEO Ed Gvazdinskas will retire in February after nearly 40 years serving the Springfield, Ill.-based credit union (The State Journal-Register July 23). Chief Operations Officer Tom Lex has been named his successor.  Gvazdinskas began his career as assistant manager in 1975 and became vice president in 1979. He became president/CEO in 1983, when Heartland was still known as Sacred Heart CU.  During his tenure, the credit union grew to $231 million in assets from $18.5 million, and to more than 26,000 members from 9,000 ...
  • FARMERS BRANCH, Texas (7/25/13)--Pat Mott, who retired in March as president of Arlington (Texas) FCU after 36 years of service, has died, according to the Cornerstone Credit Union League (Leaguer July 24). Mott  began her career with the credit union in 1976 when the credit union served City of Arlington employees and their families. Eventually it added 57 select employee groups to its field of membership, and in 1998 and 2001, it was granted a charter to serve the communities of Arlington and Mansfield.  Mott also served as a director with the Texas Credit Union League from 1990 to 1998 and as director of Southwest Corporate FCU (now Catalyst Corporate FCU) from 1991 to 2010. Visitation will be Friday 6 p.m.-8 p.m. at the Wade Funeral Home in Arlington. A memorial mass will be at 11 a.m. Saturday at St. Maria Goretti Catholic Church in Arlington ...
 

Golden 1 Awards $320K In Scholarships To 33 Students

 Permanent link
SACRAMENTO, Calif. (7/25/13)--Golden 1 CU has awarded 33 students $320,000 in renewable scholarships.
 
The $8 billion asset Sacramento, Calif.-based credit union awards annual renewable scholarships of $1,000 to $5,000 to full-time students who plan to attend an accredited, nonprofit two- or four-year college or university in California.
 
One of the winners, Svea Milet Joaquino of Elk Grove, received the Golden 1 CU Donna Giles Memorial Scholarship, which was named in honor of a former board member. This renewable scholarship awards $5,000, for a total of up to $20,000 over four years.
 
Applicants were required to sport a grade point average of 3.0 or higher and be involved in community service and extracurricular activities.
 
Golden 1 received applications from students between Oct. 15 and Jan. 15. The winners were notified in April. Scholarship funds will be disbursed to each student's college or university in August.

League Letter To Editor Touts Soundness of CUs

 Permanent link
COLUMBUS, Ohio (7/25/13)--Credit unions in Cleveland and Ohio are safe and sound, Paul Mercer, president/CEO of the Ohio Credit Union League, wrote in a letter to the editor published in Tuesday's edition of The Plain Dealer.
 
"Credit unions in Cleveland and throughout Ohio are in great shape," Mercer wrote. "They are modern, convenient, consumer-focused and community-centric. Take a look; you will like what you see."
 
Mercer was responding to a July 18 article in The Plain Dealer about Cleveland-area financial institution failures.
 
Credit unions in the Cleveland market collectively share a net worth ratio of 11.86%--well above the industry average and nearly double the levels deemed strong by state and federal regulators, Mercer wrote.
 
Mercer described credit unions' not-for-profit, member-owned cooperative structure that returns profits to members.  The core mission of credit unions is serving members, he wrote.
 
"They also provide competition to the for-profit structure, keeping products and services affordable and accessible to all," Mercer added.

CUs Prepare To Unite For Good On 2013 ICU Day

 Permanent link

MADISON, Wis. (7/25/13)--The theme of this year's International Credit Union (ICU) Day, Oct. 17, is "Credit Unions Unite for Good," the Credit Union National Association announced.
 
"We are coming off a great Unite for Good impact at America's Credit Union Conference (ACUC) in New York City," said Paul Gentile, CUNA executive vice president, strategic communications and engagement. "Now is the time to take that message and drive it across the nation. This year's ICU Day initiative, 'Unite for Good,' is the perfect way to bring credit unions together around a common cause that will make a huge difference with both national and local impact."
 
This year's theme conveys the credit union movement's shared vision of uniting behind its worthwhile cause. The message speaks to the powerful global network of credit unions and the advantages that result from sharing challenges, experiences and solutions to better serve members, CUNA said.
 
Credit unions can celebrate the movement on ICU Day and use it as impetus for making a difference in their communities. Using CUNA's tools and resources, interested credit unions can make a local impact this fall.
 
CUNA's suggestions for local action include:

  • Initiate a small-business day;
  • Team up with other local credit unions;
  • Hold a financial simulation or reality fair;
  • Host a series of after-hour financial education seminars;
  • Host a Don't Tax My Credit Union event; and
  • Organize a Capitol Tour/Hike the Hill Day.

For more information use the link.

CUNA's 'Don't Tax' Tuesday Tweets Reach 800,000+

 Permanent link
WASHINGTON ( 7/25/13)--Credit unions took creative measures to make sure their members tweeted the "Don't Tax My Credit Union" message during the Credit Union National Association's DontTaxMyCU Tuesday national grassroots Twitter campaign.
 
They delivered that message to more than 875,397 people, including members of Congress and their Twitter followers. The message that lit up Twitter reached its mark with 2,171 tweets that specifically mentioned a member of Congress's Twitter handle and the #Don'tTaxMyCU hashtag, according to CUNA's analysis.
 
Also, more than 500 messages tweeted the hashtag but without mentioning a specific member of Congress.
 
"The overwhelming grassroots response on social media just shows how strongly the public--and especially credit union members--oppose taxing credit unions," said Paul Gentile, executive vice president of strategic communications and engagement. "Credit union members nationwide understand that a tax on credit unions is just another tax on them, and they are telling their representatives in Washington: 'Don't tax my credit union.'"
 
The Don't Tax My Credit Union messages included tweets from two congressmen--Rep. Lloyd Doggett (D-Texas) and Rep. David Scott (D-Ga.)--who tweeted their agreement with the message. See related News Now story Even Lawmakers Tweet: 'I Agree #Don'tTaxMyCU.'
 
Click to view larger image Credit unions took creative measures to make sure their members took action on the "Don't Tax My Credit Union" message during the Credit Union National Association's DontTaxMyCU Tuesday national grassroots Twitter campaign. (Photo provided by Gesa CU)
One creative way to generate action came from Richland, Wash.-based Gesa CU, a $1.2 billion asset credit union with more than 112,020 members. Gesa CU tied access to its website at www.gesa.com to the Don't Tax My Credit Union efforts to contact members of Congress and deliver the "Don't Tax My Credit Union" message.
 
Those logging on to the credit union's site couldn't access it until they made a decision on whether or not they would opt to go to the Credit Union National Association's www.DontTaxMyCU.org site to send an e-mail to Congress.
 
Brian Griffith, marketing and communications manager, told News Now that as of Wednesday morning, the site had more than 5,532 click-throughs to the CUNA DontTaxMyCU microsite.
 
Some incorporated their tweets with vidoes.  A video from Alexandria,Va.-based CommonWealth One FCU was the subject of a Virginia Credit Union League tweet:  "Love this vid from @COFCU on importance of #Don'tTaxMyCU: http://bit.ly/12TnOrk ! Have u written ur lawmakers? http://bit.ly/NoTaxCU
 
The video of Charlotte Cash, president/CEO of CommonWealth One,  urges members to advocate for credit unions' tax-exemption, noting, "This is important to YOU because another tax on Credit Unions is just another tax on YOU." (Use the link to see the video).
 
Kristen Christian, who began the Bank Transfer Day movement with a tweet of her own, tweeted to her senators: "you can't touch the credit union tax exemption status! http://bit.ly/15J75WZ #DontTaxMy CU" and included entertainment--a video of MCHammer's song, "U Can't Touch This."
 
Other tweets:
  • The Northwest Credit Union Association tweeted: Taxing credit unions won't dent the deficit, but it will erase savings to the 2,870,939 members in your state. @CantwellPress #DontTaxMyCU
  • Shiro-oni:  @MaxBaucus @OrrinHatch Truth is, credit unions provide superior deposit & loan rates & greater protection from risk than banks #DontTaxMyCU.
  • StevePoniewaz:  Cooperative status is not a subsidy. Credit Union Members have paid their tax; #DontTaxMyCU@RepAnnWagner
  • Alabama CU: CUs return profits to their members. Taxing CUs hurts 1.8 million Alabamians. Visit bit.ly/ZY97Pz and ell Congress #DontTaxMyCU
  • Traci-rocks: @RepThompson @DianneFeinstein@SenatorBoxer Credit unions provide fair & affordable banking to millions of Americans-please #DontTaxMyCU
  • The Virginia Credit Union League:  #WhatPeopleDontRealize is #Virginai#creditunions re impt. source of credit ($64B in loans) and #jobs (employ 16,000 FT)#DontTaxMyCU
  • RT @BayAreaCU: This is a #CreditUnion Each member has one vote, regardless of the size of member's deposits #DontTaxMyCU
  • RT @jradebaugh: For every $1 of their fed income tax exemption #CreditUnion returns $10 to their members. Who else does that? ...
  • MT @aplusfcu: #creditunions in 2012 held $1.1B in assets, while the top 4 US banks each held more than that alone... #DontTaxMyCU
And this one from the day after from BankingYouCanTrust @BankingYouTrust: "Just because 'Don't Tax Tuesday' is over doesn't mean you shouldn't let your legislators know how you feel #DontTaxMyCU".

Loan Applications Fraud Up 38% In Calif., Mass. Cities

 Permanent link
LOVELAND, Colo. (7/25/13)--The metropolitan areas of Sacramento, Calif., and Barnstable-Yarmouth, Mass., saw potential fraudulent activity related to mortgage loan applications spike nearly 38%, compared with a national increase of 1.06% during the first quarter of 2013, according to new data.
 
Credit unions and other mortgage lenders in 10 metropolitan statistical area (MSAs) will need to be extra alert to potential fraud on loans, said Kroll Factual Data Inc., based in Loveland, Colo.
 
Despite the modest national uptick in potential fraud, certain MSAs experienced a see-sawing of fraud from the fourth quarter of 2012 to the first quarter of 2013, Kroll said. Kroll provides independent verification services to mortgage lenders, including credit unions.
 
"What is most notable this quarter is not only that data showed a nearly 38% increase of potential fraud in applications from Sacramento, Calif., and Barnstable-Yarmouth, Mass., but that these two MSAs were in the top three last quarters of geographies showing decreases," said Kroll President Rod Bazzani.
 
The drop "is a reminder to lenders that they cannot let their guard down when it comes to ensuring the integrity and accuracy of mortgage application data," Bazzani said.
 
The company examined MSAs with at least 1,000 loan applications per quarter and, using risk analysis and verification engines, isolated certain files that may contain indicators of potential mortgage origination fraud.
 
Sacramento had a 37.9% spike and the two Massachusetts cities a 37.5% increase in potential fraudulent mortgage applications during the quarter. Rounding out the top five MSAs with the highest increases are Wilmington, Del./N.J./Md., with 34.3%; Syracuse, N.Y., with nearly 26.2%, and Fort Pierce-Port St. Lucie, Fla., with almost 25%. 
 
Other cities with the highest potential fraud increases included:
  • Phoenix-Mesa, Ariz., with 20.7%;
  • Lubbock, Texas, with 20.5%;
  • Seattle-Everett, Wash., 16.9%;
  • Iowa City, Iowa, 14.3%; and
  • Kansas City, Mo.-Kan., 14%.
Leading the top 10 MSAs with the biggest decrease in potential fraudulent applications were:
  • Greenville-Spartanburg-Anderson, S.C., down 19.6%;
  • Trenton, N.J., down 17%;
  • Miami, Fla., down 16.2%;
  • Nashua, N.H., down 15.1%;
  • Columbia, Mo., down 15.1%;
  • Nashville, Tenn., down 14.7%;
  • Bridgeport-Milford, Conn., down 14%;
  • Boise City, Idaho, down 13%;
  • San Francisco-Oakland,Calif., down 11.8%; and
  • Cincinnati, Ohio-Ky.-Ind., down 12%.

St. Mary's Bank Warns Members About Breach

 Permanent link
MANCHESTER, N.H. (7/25/13)--St. Mary's Bank in Manchester, N.H., the oldest credit union in the U.S., is warning 115,775 of its current and former members about a security breach that may have compromised their personal information--including transaction records and Social Security numbers.
 
The credit union discovered malicious software--malware--on an individual employee workstation computer May 26, St. Mary's CEO Ron Covey wrote in a July 12 letter that the credit union began mailing out to members (New Hampshire Business Review July 26).
  
Immediately after discovering the malware, the $748 million asset credit union brought in a computer security consulting firm to analyze its computer system to eliminate the malware, the Review said.
 
The malware could have infiltrated 23 of St. Mary's workstation computers beginning in February, the security firm said. The malware captured information as it appeared on individual computer screens, the firm added.
 
So far there are no signs of unusual activity in member accounts created by the malware and no evidence that members' information had been acquired by unauthorized individuals, Covey said in the letter. However, the credit union urged members to change their online banking passwords.
 
For affected members, St. Mary's is making available one year of free identity theft protection services and credit-monitoring services through Experian.

Mergers Of CUs Ongoing

 Permanent link
MADISON, Wis. (7/25/13)--Several mergers or planned mergers of U.S. credit unions are in the works, as the consolidation trend continues.
 
The mergers or intended mergers:
  • Mount Olivet FCU, with $258,000 assets in Columbus, Ohio, has merged into Columbus-based Telhio CU, with $477 million in assets, to give members additional benefits such as direct deposit and online banking (The Columbus Dispatch July  22).
  • Dublin, Ohio-based Healthcare FCU, with $52 million in assets, will merge Aug. 1 with $16.4 million asset MedPro FCU, based in Akron. Healthcare FCU will be the operating credit union (Business First of Columbus Online July 16).
  • Security One FCU, based in Arlington, Texas, with $55 million in assets, has signed an intent to merge into Texas Trust CU, a $748 million asset credit union based in Mansfield, Texas (Mergers & Acquisition Week July 24). The merged institution will have 12 branches. The merger will provide more benefits to Security One members, and  give Texas Trust a presence in Arlington.
  • $140 million asset USU Charter FCU, based in Logan, Utah, announced on July 2 its intent to merge into Goldenwest FCU, Ogden, with $814.5 million assets (Cache Valley Daily.com July 2). The merged entity, operating  as Goldenwest, will have 26 branches, $985 million assets and more than 106,000 members.
  • Parchment, Mich.-based First Community FCU, which has $682.4 million in assets, plans to merge with $264.3 million asset E&A CU in Port Huron (MiBiz.com June 23). Pending regulatory approval, the two credit unions intend to complete the merger later this year. The merged credit union will operate under a new name.
  • Quiet Corner Community CU, based in Putnam, Conn., and having $1.7 million in assets, has merged into Groton-based, $764 million asset Charter Oak FCU. As a result of the merger, Charter Oak's new Putnam branch absorbed Quiet Corner's former operations in Putnam, Charter Oak said on its website.
  • Kilowatt CU, with $22.7 million in assets, in Madison, Wis., will merge into Madison-based Heartland CU, with $191.5 million assets, on Aug. 1 (Channel3000.com July 21). Heartland will provide services to Kilowatt members that they couldn't previously obtain, said Kilowatt President/CEO Nick Troia.
  • The $300,000 asset DairyPak Athens CU in Athens, Ga., has merged into First Reliance CU, also of Athens, with $1.7 million in assets, so DairyPak Athens can offer its members a full range of services (OnlineAthens July 13).
The National Credit Union Administration said in its June Insurance Report of Activity that it approved 18 completed mergers in June. That  compares with 15 competed mergers in June 2012.

FASB To Have New Vice Chair As Of Sept. 1

 Permanent link
WASHINGTON (7/25/13)--The Financial Accounting Standards Board (FASB) will have a new member and vice chairman as of Sept. 1.  The Financial Accounting Foundation (FAF), which oversees FASB,  announced Wednesday it has appointed James L. Kroeker, former chief accountant for the U.S. Securities and Exchange Commission,  for a term that will end June 30, 2018.
 
The FAF announcement notes that Kroeker will fill a vacancy created by the retirement on June 30 of former FASB Chairman Leslie F. Seidman.  It says that the dormant position of vice chair is being reinstated at this time because of "increasing demands on the time of the FASB chairman."
 
"Jim Kroeker is ideally suited to fill the new role of vice chairman at this important time in the FASB's history," said FAF Board of Trustees Chairman Jeffrey J. Diermeier.

"During his tenure as chief accountant, Jim demonstrated an unwavering concern for the interests of investors as well as those of preparers of financial statements. The combination of his deep technical expertise and his extensive experience working with a wide range of accounting constituents will make him an exceptionally able board member."
 
In April, Russell G. Golden was named new FASB chair as of July 1.

CU System Briefs (07/24/2013)

 Permanent link
  • EL CAJON, Calif. (7/24/13)--A man accused of robbing an El Cajon, Calif., credit union branch of California Coast CU, based in San Diego, was arraigned Friday in county court. Richard Raul Bareno Jr., 35, allegedly threatened tellers with a pistol and fired it into the air during the robbery. Bareno was arrested in a parking lot outside a Chula Vista, Calif., fast-food restaurant at 10 p.m. July 16, police said. He has been in custody in lieu of $155,000 bail. A man with a large dark tattoo on his face entered the $1.7 billion asset credit union on July 9, fired a shot from a handgun, leapt onto a service counter, pointed the weapon at tellers and shouted at them to give him cash, police said. The tellers complied, and the man fled with an undisclosed amount of money, police said. There were no injuries (kusi.com July 19) ...
  • TEMPLE , Texas (7/24/13)--Karl Dean Moore, 47, of Temple, Texas, who was arrested for a robbery at Killeen, Texas-based Texas Partners FCU, made an initial appearance Monday in federal magistrate's court in Waco, Texas. Moore went before U.S. Magistrate Jeffrey C. Manske, who scheduled an arraignment and detention hearing on Thursday (KWTX.com July 23). Moore was arrested Friday on an unrelated theft warrant and then was charged in the credit union's robbery. He allegedly handed a teller a note demanding money about 4 p.m. Thursday. He did not show a weapon and did not claim to have one, police said ...

NEW: 'Don't Tax' Message Hits Its Mark: More Than 800,000

 Permanent link
WASHINGTON (7/24/13 UPDATED 11:10 a.m. ET)--More than 875,397 people, including members of Congress and their Twitter followers, saw the "Don't Tax My Credit Union" message on the Credit Union National Association's DontTaxMyCU Tuesday.
 
The message that lit up Twitter reached its mark with 2,171 tweets that specifically mentioned a member of Congress's Twitter handle and the #DontTaxMyCU hashtag, according to CUNA's analysis.
 
In addition, more than 500 messages were tweeted with the hashtag but without mentioning a specific member of Congress.
 
"The overwhelming grassroots response on social media just shows how strongly the public--and especially credit union members--oppose taxing credit unions," said Paul Gentile, executive vice president of strategic communications and engagement. "Credit union members nationwide understand that a tax on credit unions is just another tax on them, and they are telling their representatives in Washington: 'Don't tax my credit union.'"
 
The Don't Tax My Credit Union messages included tweets from two congressmen--Rep. Lloyd Doggett (D-Texas) and Rep. David Scott (D-Ga.)--who tweeted their agreement with the message. See today's News Now story Even Lawmakers Tweet: 'I Agree #Don'tTaxMyCU.'

CU Reports Fraudulent Transactions From China

 Permanent link
FAIRLAWN, Ohio (7/24/13)--At least half a dozen members of Towpath CU, a $115 million asset credit union in Fairlawn, Ohio, experienced fraudulent transactions originating in China on their accounts last week.
 
Towpath warned that six and possibly eight members saw transactions averaging $800 from a merchant--believed to be a bar--in Shanghai, the credit union told the Beacon Journal  (July 19).
 
Members began reporting the transactions Thursday afternoon, and the credit union has been reviewing its accounts for other potential victims, said the newspaper.  Towpath is replacing the cards and returning the money stolen from the accounts to the member when they sign an affidavit about the loss,
 
Towpath's website said it has shut down its Towpath CU Debit and Visa cards in China to avoid more potential fraud. No other areas have been impacted. The site provided telephone numbers for the credit union and for Visa to report suspected fraudulent activity.
 
Towpath CEO Rose Bartolomucci  told the newspaper that the national company that handles debit cards for  financial institutions including Towpath sent an alert in June about similar fraud originating in China.
 
The newspaper said the scam is unusual because the scammers swiped actual debit cards with the member's account number on them to complete the bogus transaction. When an actual card is swiped, the financial institution can't charge back the funds to the merchant as it could if only a stolen account number had been used for the transaction.
 
The credit union urged consumers to monitor their transactions and immediately notify their financial institution if they suspect fraudulent activity.

Wisconsin Gov. Signs CUSO, Funds Transfers Bills

 Permanent link
MADISON, Wis. (7/24/13)--Wisconsin Gov. Scott Walker signed two credit union-supported bills into law at the Wisconsin State Capitol July 5.
 
"Over a number of years, Congress and state legislatures have created a legal and regulatory framework for credit unions that can make serving members and their communities very challenging," Tom Liebe, vice president of government affairs for the Wisconsin Credit Union League, told News Now. "Gradually undoing or correcting the crisis of creeping complexity--as a practical matter--is going to be done in increments.
 
Click to view larger image The Wisconsin Credit Union league's Tom Liebe, vice president of government affairs, and Sarah Wainscott, government affairs specialist  (second and fourth from left, respectively) are joined by Wisconsin State Senate Committee on Financial Institutions and Rural Issues Chair Dale Schultz (R-Richland Center, third from right) and representatives from the Department of Financial Institutions and Wisconsin Bankers Association as Gov. Scott Walker (seated) signs Assembly Bill 58, which makes key credit union service organization updates. (Photo provided by the Wisconsin Credit Union League)
"Governor Walker signing two pieces of legislation recently represents more steps in the right direction and builds on Wisconsin credit unions' continued streak of passing positive legislation and killing negative proposals," he added.
 
Act 22 (2013 Assembly Bill 58) allows the Office of Credit Unions (OCU) to expand the list of permissible services provided by credit union service organizations (CUSOs) without going through the lengthy and complicated "Clearinghouse Rules" process.
 
"In many cases, the circuitous rule adoption process state agencies need to follow can be a barrier for adopting, eliminating or modifying regulations," Liebe said. "In this case, eliminating that arcane process will allow the OCU to expand the list of permissible activities of CUSOs in a matter of weeks or months instead of years."
 
The league worked diligently to turn back opposition of a powerful trade association to get this important change adopted, he said. Thanks to the work of Wisconsin Credit Union activists and the Assembly and Senate Financial Institutions chairs, both houses passed the AB 58 with unanimous votes, Liebe said.
 
2013 Act 33 (Senate Bill 116) provides clear guidance for some funds transfers for credit unions. A Dodd-Frank Act amendment left incomplete guidance for some remittance transfers. The Credit Union National Association attempted to avoid this problem when it provided a comment letter on the Reg. E amendments to implement some Dodd-Frank changes, Liebe explained. The Federal Reserve Board failed to heed CUNA's advice to avoid the problem and states have been left to adopt Article 4A of the Uniform Commercial Code, he added.
 
"Regulatory compliance is complicated enough without the government providing either contradictory guidance, or worse, none whatsoever," said Liebe. "While adoption of Act 33 may seem modest on its face, it helps remove uncertainty for credit unions for certain transactions."
 
Liebe and league Government Affairs Specialist Sarah Wainscott were present as Walker signed the bills into law.

Mass Media Paying Close Attention To Tax Battle

 Permanent link
MADISON, Wis. (7/24/13)--While the "Don't Tax My Credit Union" message was the focus Tuesday for credit unions, the mass media also took note this week of the battle to preserve credit unions' tax exemption. Credit unions and leagues told why credit unions are exempt in a number of articles. Here's a roundup of the coverage.
 
With Washington debating "sweeping" tax reform, the old credit unions vs. banks argument about the tax exemption is heating up, according to Albany, N.Y.'s CBS affiliate Monday. "If credit unions were taxed, it would basically be the end of the credit union charter as we know it," Mike Lanotte of the Credit Union Association of New York told CBS. "Credit unions' mission, to serve members who work in certain organizations or specific employers or live in certain communities, has not changed," he said.
 
The station also announced that the Credit Union National Association's "Don't Tax My Credit Union Tuesday" held yesterday was "being heavily promoted on social media." (See related story, Even Lawmaker Tweets: 'I Agree #DontTaxMyCU,' in today's News Now.)
 
The tax exemption is "absolute crucial to the financial health of credit unions," Wayne Tew, president/CEO of Las Vegas-based Clark County CU told the Las Vegas Business Press (July 22). "If taxed, the credit union's ability to grow would be severely impaired, he said.
 
Las Vegas credit unions said that banks' efforts were "an attempt by banks to eliminate competition and consumer choice. The tax exemption is crucial to credit unions, which by law can't raise capital through public stock offerings like banks can." 
 
If the exemption is eliminated, who would remain to hold the banking industry accountable, Tew asked. "Let me stress that our members receive the benefits of our profits."
 
In the Clarion Ledger Saturday, Mississippi Credit Union Association President Charles Elliott Jr. told what would happen if credit unions lost that exemption: "We would go out of existence. There's no way we'd be able to stay in business" as credit unions, he warned.
 
Russell Clower Jr., a credit union member who is on long-term disability, told the Ledger his credit union typically waives service charges on depositing his checks because he can't visit local branch to do so. He has a credit card from the credit union that he might not have received otherwise, he told the Ledger.
 
Although Jackson-based Magnolia FCU has grown, it hasn't departed from its core mission of working with members banks won't deal with, CEO Steve Pollman said. Credit unions "don't have shareholders. We can't go out and sell stock the way a bank can to make capital improvements. The tax-exempt status allows us to be a better financial institution," he told the publication.
 
Banks have attacked Hope CU in Jackson for its aggressive lending, the article said. However, the numbers reflect the recession's impact on lower-income residents' ability to get accounts and service from banks, said Bill Bynum, Hope's CEO. They turned to credit unions. That highlights the continued need for tax-exempt credit unions, he said.
 
WEAR TV also covered the battle (July 19), noting that banks hope to "cripple the credit unions using Washington to crush the competition," and adding, "Consumers should hope that the big banks don't succeed."
 
Use the links to access the coverage. For more media coverage, see "News Coverage Helps Poke Holes In Banks' Attacks," in Monday's News Now.

Even Lawmakers Tweet: 'I Agree #DontTaxMyCU'

 Permanent link
MADISON, Wis (7/24/13)--The "Don't Tax My Credit Union" message lit up Twitter yesterday--the day the Credit Union National Association declared as DontTaxMyCU Tuesday. And at least two congressmen were willing to join in--tweeting agreement with the "Don't Tax" message, and one adding that credit unions are an "essential banking option" to consumers in his state.
 
U.S. Rep. Lloyd Doggett (D-Texas) tweeted his support of credit unions' tax exemption.
U.S. Rep. Lloyd Doggett (D-Texas) tweeted  in support of credit unions tax-exempt status from his handle@RepLloydDoggett with these words: "I support credit unions as essential banking options to all Texans. Having worked with #creditunions for 3+ decades, I agree #Don'tTaxMyCU."

Also, Rep. David Scott (D-Ga.) tweeted a reply directly to Delta Community CU's post.  The lawmaker agreed that the credit union's members, many of whom reside in his district, "should not be taxed for using a non-for-profit CU."
 
CUNA's staff was busy Tuesday monitoring the day-long deluge of tweets in CUNA's one-day social media campaign to send a unified message to Capitol Hill that a tax on credit unions would be a tax on 96 million member-owners.
 
"Things are still in progress, but we're happy with what we're seeing so far," said Trey Hawkins, CUNA's vice president of political affairs. CUNA will have a report today about the number of contacts made with the nation's lawmakers expressing the need to preserve credit unions' tax-exempt status, he told News Now Tuesday.
 
Members went to bat for their credit unions.  Some examples:
  • Stacy Hovan @stacysiglin Banks needed bailout money, give profits to shareholders & bonuses to CEOs. #Creditunions give profits to members & community. #DontTaxMyCU
  • THE Brian Trotter @btrott3232s: @SenAlexander I am a member-owner of a TN credit union. Taxing it will take $$ from my pocket. Please #DontTaxMyCU #DontTaxMyCU
  • Dizzy Felkel @DizTrain; @LindseyGrahamSC @RepTomRice @SenatorTimScott Big banks won't make our loans, they're "too risky" Americans need credit unions #donttaxmycu
  • Dave Boden @dboden6m Don't hurt American consumers! #DontTaxMyCU @alfranken @amyklobuchar
  • Mike Wilson @mwilly3311m @SenTedCruz @JohnCornyn TX Senators take the lead! PLEASE #DontTaxMyCU CU's are a great source for the underserved, don't take that away!
  • Jeremiah DeGollon @JJDeGollon1m @RepSeanDuffy Please support my credit unions tax status! My family saved $795 last year because we bank with @SummitDoMore #DontTaxMyCU
  • Mike Wilson @mwilly338m Good info for the #DontTaxMyCU drive http://www.donttaxmycreditunion.org/  CUs are a great source of employment & financial support in their communities.
State leagues also helped coordinate the efforts, providing lists of legislators' Twitter addresses and the #DontTaxMyCU and #DontTaxTuesday hashtags. Many of them also tweeted.
 
Even service providers and other organizations got in the grassroots mood. Grand Rapids, Mich., based CU*Answers and its cuasterisk.com network urged staff and client credit unions to take part in the CUNA-sponsored campaign and tweet their legislators. "This tax exemption is crucial in maintaining the credit union difference  as it allows credit unions to offer their members lower loan rates and fees and higher savings rate," said the technical solutions provider.
 
News Now also spotted tweets from the National Credit Union Foundation staff, Credit Union House, CUNA Mutual Group, and more.
 
The event, of course, drew the attention of bankers.  The Independent Community Bankers Association tweeted : "ICBA to #Senate: tax exemption 4 large CUs, opp to broaden #tax base, raise revenue & improve fin svcs marketplace."

The mass media, meanwhile, are paying attention to credit unions' battle to preserve their tax exemption in their own publications and broadcasts. See related News Now story Mass Media Paying Close Attention To Tax Battle.

CUs Come To The Rescue With Sequestration Aid

 Permanent link
MADISON, Wis. (7/24/13)--Federal budget limitations in the U.S. are leading to many employee furloughs this summer. Credit unions are responding to requests from members for help with lighter paychecks.
 
Robins FCU in Warner Robins, Ga., with assets of $1.74 billion, is offering members who work at the Robins Air Force Base several services to help them through their furlough periods. They include special furlough loans, refinancing car loans, home mortgage-loan assistance, a skip-a-payment option and extending terms of current loans (The Telegraph July 18). 
 
Because federal budget cuts resulted in 11-week furlough period that began last week, employees at the base are being furloughed one day per week through September, which cuts their pay for that period by 20%, The Telegraph said.
 
CBC FCU, a $405 million asset, Oxnard, Calif.-based credit union, is providing a line of credit for about 5,000 civilian employees at Naval Base Ventura County to help them get through furloughs (Ventura County Star July 12).  
 
The credit line is available for up to two months of applicants' net pay, Patrick Miller, CBC FCU president/CEO, told the Star. If the line of credit is repaid by the end of 2014, financing is interest free. After that it converts to 9.9% interest, he added.
 
Other sequestration-aid programs by credit unions include:
  • SAC FCU in Bellevue, Neb., will offer many tools for financial management to assist members facing pay decreases due to the furloughs. The $675 million asset SAC will provide financial counseling, loan modifications, skip-pay options, emergency short-term loans, and no penalty for early withdrawal of share certificates, the credit union said in a release. "Our goal is to serve our members, whatever the situation," said SAC FCU President/CEO Gail DeBoer.
  • Keys FCU, in Key West, Fla., with $124 million in assets, is offering those affected by sequestration the ability to skip one payment on an existing loan for no additional fee, penalty-free withdrawal on share certificates, a debt review to help members reduce their monthly expenses, and a sequester loan in which members can borrow up to $5,000 at 1% annual percentage yield for 36 months (The Key West Citizen July 21).
  • Northern CU in Watertown, N.Y., this month began assistance programs to help civilian employees at Fort Drum manage reduced paychecks, owing to an 11-week furlough period that began the week of July 8 (Watertown Daily Times July 22). The programs at the $188 million asset credit union include 60-day no-interest loans, 30-day loan deferment, loan refinancing and financial consulting.

SECU's Mortgage Program Offers Tax Benefits

 Permanent link
RALEIGH, N.C. (7/24/13)--In 2012, members of Raleigh, N.C.-based State Employees' CU buying their first home with SECU's program saved an average $1,100 per household in federal income tax credits by participating in the North Carolina Housing Finance Agency's  (NCHFA) Mortgage Credit Certificate (MCC) program.
 
More than 200 SECU first-time homebuyers have participated in the program since 2009, said SECU.
 
The MCC program, authorized by Congress in the 1984 Tax Reform Act, is offered in the state by NCHFA to eligible borrowers through lenders such as SECU.  Qualifying buyers can take a federal tax credit of 30% of the mortgage interest they would pay annually, up to $2,000, each year they occupy the new home.
 
Homeowners also are eligible to claim an interest deduction on the remaining 70% of the interest they pay, said SECU.  Those who meet regional sales price and income limits can use MCC with most fixed-rate mortgages, as well as with SECU's two-year adjustable-rate mortgage.
 
The program "helps qualified borrowers keep more of their hard-earned income through decreased tax liability, while they acquire their dream of first-time ownership," said SECU Chief Lending Officers Jerry Harmon.  "As a trusted financial provider for our member-owners, it is vital that we bring awareness to and assist members with the programs and services that can help strengthen them financially," he said.

Ohio CUs' Marching Raises $136K For Hospitals

 Permanent link
COLUMBUS, Ohio (7/24/13)--Ohio credit unions raised $136,000 for the Children's Miracle Network Hospitals through the 2013 Ohio Credit Unions: Marching Miles for Miracle Kids campaign.
 
Credit unions and chapters held fundraisers and participated in regional events and sponsorships to raise the funds, said the Ohio Credit Union League (eLumination Newsletter July 10).
 
Funds raised during the rest of the year will count towards the 2014 total. That includes Miracle Jeans Day, Sept. 18, when credit union associates nationwide can donate $5 to wear jeans in support of their local Children's Miracle Network Hospital.
 
The charity raises funds and awareness for 170 children's hospitals.
 
Credit unions support the hospitals through Credit Unions for Kids, and are the third-largest corporate sponsor of the hospitals, behind only Walmart and Costco, the league said. The effort helps children regardless of their family's ability to pay.
 
Funds raised help support new facilities, equipment, research programs, patient services, special patient needs and health education programs benefiting 17 million children annually.

Irish CUs' Resolution Plan Extended Until December

 Permanent link
DUBLIN, Ireland (7/24/13)--A resolution plan to make Ireland's 400 credit unions more stable will be extended until December, the European Commission said Tuesday.
 
Despite slight modifications, the plan, first approved in December 2011, remains consistent with the commission's guidance to assist credit unions and to help support the Irish economy, said the commission (Irish Examiner July 23).
 
The commission created the plan to provide financial stability and minimize economic losses if a credit union becomes unable to meet the regulatory requirements set by the Irish Central Bank.
 
Under the plan, a failing credit union would transfer all assets and liabilities to an acquirer in a competitive process.
 
A resolution fund will provide a financial incentive for the acquirer, if necessary, said the commission. The state will make an initial repayable contribution to the resolution fund, which will over time be funded by levies on credit institutions, it added.

The resolution fund is financed with nearly $660.6 million from the government. The plan allows credit unions to appoint a new manager, modify liquidation and transfer credit unions assets and liabilities.

CU System Briefs (07/23/2013)

 Permanent link
  • MILWAUKIE, Ore. (7/23/13)--Mary Greco is the new president/CEO of the $250 million Clackamas FCU in Milwaukie, Ore. She previously served as the credit union's executive vice president. Greco began her career at Coconino FCU in Flagstaff, Ariz., where she spent six years. She continued in the credit union industry for the next 15 years in Las Vegas, first at the former Network FCU and later at Silver State Schools CU. She joined Clackamas in 2001. Her experience includes operations, lending, accounting, branch administration, and human resources and training ...
  • SEAFORD, Del. (7/23/13)--Sussex County FCU's employees and members, in the true cooperative spirit, collected 25 gallons of Pop Tabs to donate to the Ronald McDonald House of Delaware, says the Delaware Credit Union League (Together July 15). The Seaford, Del.-based, $252 million asset credit union said its members and employees are committed to supporting children and their families who benefit from the house's services. In addition to supporting the community's recycling efforts, the Pop Tabs provide monetary value, measured in weight to support a program that has personally impacted the lives of the credit union's employees, members and their families. Pictured with some of the Pop Tabs are, from left, Debbie Jewell, SCFCU business development manager, and Barbara Loeslein, development director at Ronald McDonald House of Delaware (Photo provided by the Delaware Credit Union League) ...
  • FARMERS BRANCH, Texas (7/23/13)--After 37 years of involvement with the Southwest CUNA Management School, Dr. Charles Idol is retiring as a faculty member. Idol was honored last week during the 41st graduation ceremony at the school, said the Cornerstone Credit Union League (Leaguer July 22).  He has been involved in the credit union movement since 1975, serving as a credit union director and providing consulting, research and educational services in asset/liability management and investments for credit unions and their professional associations. He has conducted seminars for the Credit Union National Association, the Credit Union Executives Society, the National Credit Union Administration, the National Association of State Credit Union Supervisors, AICPA , state credit union regulatory agencies and more than 30 credit union leagues.  He also served as chief economist for a number of organizations, including the Texas Credit Union League (now Cornerstone) and the Southwest Corporate FCU (now Catalyst Corporate FCU) ...
  • EAST LANSING, Mich. (7/23/13)--Michigan State FCU (MSUFCU) in East Lansing, Mich., has decided to rebrand its Oakland University branch in Auburn Hills, Mich., as Oakland University CU (OUCU), said the Michigan Credit Union League. Although OUCU is a trade name, the credit union will remain a part of MSUFCU. The enhanced relationship will allow OUCU to strengthen its more than 50-year partnership within the community, by providing an endowed student scholarship, a grant program, sponsorships, ATM locations on campus, and financial education, said MSFCU. The $2.34 billion asset MSFCU's commitment to Oakland University is valued at nearly $5 million over 10 years (Michigan Monitor July 22) ...

NEW: Harland Financial Solutions To Be Sold To Davis + Henderson

 Permanent link
SAN ANTONIO (7/23/13, UPDATED 4:45 p.m.)--Harland Clarke Holdings Corp. has entered into an agreement to sell its subsidiary, Harland Financial Solutions, to Davis + Henderson Corp. for $1.2 billion in cash.
 
Harland Financial Solutions accounted for roughly 15% of Harland Clarke Holdings' business in 2012.
 
D+H supports more 1,700 credit unions and banks across the U.S., including Mortgagebot and Compushare.
 
"Rest assured, Harland Financial Solutions will continue to operate in a 'business as usual' fashion, with no changes or impact to our clients," said Raju Shivdasani, Harland Financial Solutions CEO.
 
The sale is subject to customary closing conditions, including the expiration or termination of applicable waiting periods, and is expected to close in the third quarter of 2013.
 
D+H has established a website (www.NewFinTechFuture.com) to provide additional information regarding the acquisition.
 
Harland Clarke, the company's largest business segment, services about 12,500 financial and commercial institutions through multiple channels. Its marketing products include business intelligence and analytics, management, strategic services, and award-winning creative development.
 
Harland Clarke's payment solutions include checks, cards and related products and services, and high-value transactional documents, including statements, compliance documents and communications.
 
The company's retail division services big box retailers, large direct selling businesses, and membership-based and affinity organizations by products and services, including checks and related products, cash management and fulfillment services, private label materials, and small business marketing materials.
 
The subsidiary sold is not the same organization as Harland Clarke. Corp., the check printers, which is a CUNA Strategic Services provider.

Deadlines Set For Documents On NCUA Appeal Of Barclays Ruling

 Permanent link
DENVER, Colo. (7/23/13)--The National Credit Union Administration will have until Aug. 28 to file its opening briefs with a Denver appellate court on its appeal of the dismissal of its claims against Barclays Capital, which sold residential mortgage backed securities that contributed to the collapse of U.S. Central FCU and Western Corporate FCU.

A July 16 letter from the Clerk of Court of the U.S. Court of Appeals for the Tenth Circuit to NCUA attorneys noted that the court had received and docketed NCUA's appeal and outlined deadlines for documents and briefs to be filed in the case.  Friday, the U.S. District Court for the District of Kansas certified that the record is complete for purposes of an appeal, starting a 40-day clock for NCUA's briefs under the Tenth Circuit's rules.

The agency's appeal comes after the July 10 decision by the district judge to dismiss the Barclays case, as well as 12 out of 20 claims against Credit Suisse, on the basis that the claims are time-barred (News Now July 17).  The Kansas court--as well as a California court in a similar NCUA lawsuit against brokerage firms over corporate losses due to RMBS--said an extender statute and a tolling agreement did not delay the time allowed for NCUA to file its claims.
 
The Tenth Circuit Court of Appeals is also reviewing the time-barred issues in a separate suit NCUA filed against RBS Securities.

CUs Prepared To Help Members Affected By Detroit Bankruptcy

 Permanent link
DETROIT (7/23/13)--The city of Detroit formally sought federal bankruptcy court protection Thursday when Kevin Orr, the city's appointed emergency manager, made a filing after Michigan Gov. Rick Snyder approved it. The Michigan Credit Union League and area credit unions are poised to help members impacted by the event.
 
"There is still much uncertainty about what the bankruptcy filing will mean for the city of Detroit, and that includes those credit unions that serve city employees," MCUL & Affiliates CEO David Adams told News Now.
 
"But what is certain is that those credit unions will continue to support their members through this process. While these are trying times, we hope that this will be the start of a new, more prosperous future for one of America's great cities," he said.
 
Area credit unions also are uncertain about the bankruptcy's effect. "We don't know what the repercussions are; it is still early for us," Kathy Trembath, president/CEO of Detroit Municipal CU, which serves mostly city employees, told News Now. "We don't know if they will reduce wages more for municipal employees. We may do restructuring of loans or extensions for members.
 
"We will take any action to help members," she added. "Right now, [the situation] is all over the place as to what will happen. Everyone is speculating on things.  We will be proactive to protect our credit union members and assets."
 
Snyder explained his decision in a letter authorizing the bankruptcy filing by citing key statistics  that indicate the city's troubled state (USA TODAY July 19-21).
 
They include: 
  • Since 2000, the city's unemployment rate has nearly tripled and is more than double the national average;
  • About 78,000 city structures have been abandoned;
  • In the first quarter of 2013, an estimated 40% of the city's street lights didn't work; and
  • The city's homicide rate is at a historic high.
Lost auto-industry jobs and an escalating crime rate have caused many middle-class citizens to leave Detroit during the past few decades, resulting in the city's population plummeting to 700,000 from a peak of 1.8 million during the 1950s auto-industry boom times, said USA TODAY.

Big Banks Argue Eastern Financial Florida CU Knew the Risks

 Permanent link
MIAMI (7/23/13)--Four big banks and two ratings firms have filed a motion to dismiss a lawsuit brought in a Southern Florida federal court by Space Coast CU over $150 million in investment losses that led to the collapse of Eastern Financial Florida CU, which Space Coast later assumed.
 
Eastern invested the amount in collateralized debt obligations (CDOs) backed largely by residential mortgage-backed securities (RMBSs) between 2005 and 2007. 
 
The case involves instruments underwritten by Merrill Lynch, Pierce and Fenner Inc., J.P. Morgan Securities LLC, UBS Securities LLC and Barclays Capital, and rated by ratings agency The McGraw Hill Cos. (Standard & Poor's) and Moody's Investor Services.
 
The motion to dismiss notes that on March 18, the U.S. District Court in Miami rejected the Melbourne, Fla.-based Space Coast's claims of fraud but allowed Space Coast to amend its complaint. In that ruling, the court noted that the suit required "particularized facts" related to the frauds and the specific CDOs, instead of relying on broad due diligence reports, emails and government reports, forensic analysis and reliance on bankruptcy debtors' statements.
 
Space Coast's amended complaint alleged fraud, negligent misrepresentation, unjust enrichment, constructive trust and aiding and abetting fraud. In the motion to dismiss, the defendants argue that Eastern knew the risks. "Indeed the offering documents for these CDOs specifically warned Eastern about the unreliability of the subordination levels and the riskiness of investing in securities linked to subprime and non-conforming loans," said the banks' motion.
 
The banks also argued there is not enough facts supporting the credit union's allegations, that the amended complaint has "recycled allegations" that are not supported by particularized facts, and that the banks cannot be held liable for misstatements they did not make.
 
Like other defenses  in similar lawsuits over RMBS, in which the National Credit Union Administration sued a number of brokerage firms over losses experienced by corporate credit unions, the defendants also argue that the claims are "time-barred" and were not filed on time.

CUAD Social Good Site Reports 1,000 Stories Posted

 Permanent link

BISMARCK, N.D. (7/23/13)--The Credit Union Association of the Dakotas reports that the CU Social Good website it launched seven months ago has posted more than 1,000 individual stories about credit unions reaching out to their communities.
 
The site was launched in January and dedicated solely to the sharing of the good things that credit unions do for people and their communities every day.
 
Broken down by category, the entries include, as of Monday afternoon:

  • Charitable work, 500;
  • Community, 427;
  • Credit Unions for Kids, 19;
  • Financial literacy, 137;
  • Scholarships available, 23;
  • Scholarships awarded, 84; and
  • Sustainability, 19.

To celebrate the milestone, CUAD is giving away 25 T-shirts to credit union employees who sign up for its weekly emailed newsletter, Spotlight, which highlights some of the stories each week. Winners will be randomly selected from Spotlight subscribers and announced Aug. 30, said CUAD. 
 
"Credit unions give back to their local communities in an amazing variety of creative and generous ways," said CUAD, adding, "Credit union employees and members are well-known for their volunteer work and charitable fundraising events." CUAD noted the website can be used by credit unions to help in lobbying legislature, community efforts and awareness campaigns.
 
Also, watch for News Now's series of special reports on outreach efforts by credit unions all over the U.S.  And, check out the stories posted--or post your own--on the Unite For Good and aSmarter Choice websites (use the links).
 
Letting people know about the good credit unions do helps raise awareness of credit unions; raising awareness is one of three legs that the Unite For Good campaign stands on to promote the strategic vision where "Americans choose credit unions as their best financial partner."

League Surveys In Four States Note Mobile Banking Increase

 Permanent link
FARMERS BRANCH, Texas, and DULUTH, Ga. (7/23/13)--Mobile banking adoption continues to surge, according to surveys in four states by two credit union leagues.
 
About 60% of respondents in Arkansas, Oklahoma and Texas used mobile banking in a survey conducted by the Cornerstone Credit Union League (The Leaguer July 22). About 57% said they use mobile banking weekly; 22% said they engage in daily usage and 21% use mobile banking at least monthly.
 
The league's survey suggests consumers' view is that mobile banking is becoming a necessity rather than a luxury. About 44% of respondents to the survey indicate the availability of mobile banking influences their choice of financial institutions. Roughly 33% of survey respondents said their financial institution doesn't offer the service.
 
Those who used mobile banking indicated they used three functions: Checking account balances (95%), followed by making payments (40%), and making deposits (15%).
 
Of those who do not use mobile banking, 39% said they do not see the need, 33% are concerned about security, and 11% said the technology is too complicated. In addition, 22% indicated their phone does not support the technology.
 
In another survey, in Georgia, more than 49% of respondents to the Georgia Credit Union Affiliates (GCUA) Midyear 2013 Consumer Survey report said they use mobile banking (Consider This July 2013), said GCUA. This is an 18% increase from year-end 2011
 
Mobile banking also is on the rise nationally. About 28% of all mobile phone users and 48% of smartphone users have used mobile banking in the past 12 months, according to a November 2012 survey by the Federal Reserve Board. Those figures represent increases of seven percentage points and six percentage points, respectively, since December 2011. The Federal Reserve Board also reports that 49% of underbanked consumers report using mobile banking in the past 12 months.
 
 

Wisconsin CUs Raise $542,919 For Kids' Hospitals

 Permanent link
MADISON, Wis. (7/23/13)--The Wisconsin credit union system raised more than a half million dollars for Children's Miracle Network Hospitals in 2012. The $542,919 went to the hospitals nearest the area where the funds were raised, said the Wisconsin Credit Union League.

Wisconsin credit unions accounted for slightly more half of that success. Chapters accounted for about 10% of the total (theleague.coop July 19).

CUNA Mutual Group, with $137,000, provided the largest support from a system partner. Also, the company has separately donated upwards of $500,000 to the charity since 2005 through its local support of a hospital-run kindergarten-readiness program in Dane County. CUNA Mutual also contributes to other states' totals through sponsorship contributions.

CO-OP Financial Services was the next-largest giver in Wisconsin among system partners, with $35,000 contributed. CO-OP also matches funds raised by credit unions that apply for a match before they conduct their fundraisers. In 2012, more than $3 million was raised nationwide through the match-up program.

Credit Union Miracle Day, a run in Washington, D.C., raised the rest of Wisconsin's 2012 fundraising total.

Wisconsin ranked fifth in the nation for credit union support of the charity. The top states for credit union fundraising were California and Texas, each raising more than $1 million in 2012, followed by Florida at $860,000 and Arizona at $554,944.

Credit unions support Children's Miracle Network Hospitals through Credit Unions for Kids, and are the third-largest corporate sponsor of the hospitals, behind only Walmart and Costco, the league said. The effort helps children regardless of their families' ability to pay.

Funds raised help support new facilities, equipment, research programs, patient services, special patient needs and health education programs benefiting 17 million children annually.

CUs' Summer Fun Often Has a Cause In Mind

 Permanent link
MADISON, Wis. (7/23/13)--It's July, it's hot, and sometimes credit unions want to have a little fun. 

Click to view larger image Genisys CU, Pontiac, Mich., found out fun and water go together when it sponsored Paddlepalooza 2013, an eight mile canoe and kayak race, which began in Auburn Hills and ended at Rivercrest Banquet Center in Rochester Hills.  Eighty-four paddlers and 20 volunteers participated and had a chance to win items donated by sponsors and supporters, such as duffle bags, paddle floats, waist packs, water bottles,  apparel and gift cards. "It is great to see the Auburn Hills and Rochester Hills communities come together to create a wonderful event on the river," Genisys President/CEO Jackie Buchanan told the Michigan Credit Union League (Michigan Monitor July 22). (Photo provided by the Michigan Credit Union League)
Credit unions, being people-oriented, are finding many ways to have fun this summer, from creating playful videos, to showing appreciation for their members with special events, to boosting employee morale with barbecues and hotdogs, to raising funds or volunteering for a charity. Often the good times had a cause in mind.
 
Here are a few examples.
  • Community Financial CU, Plymouth, Mich., is sponsoring many events--from movies to concerts and in between this summer. They include A Summer Cinema Matinee Series 2013 at the Penn Theatre in Plymouth; Canton Thursday Night Concerts; Friday Family Fun Nights in Novi, Music in the Air in Plymouth and Tuesday Mornings in the Park in Novi.  "Families are how our communities are built and why they continue to thrive," said Sarah Cousineau, marketing manager. "That is why we are proud to continue to support events around the area that promote families enjoying time with each other throughout the summer."
  • Alabama CU, Tuscaloosa, Ala., on Saturday hosted a yard sale and street market so members of the community could "find a good deal" and "help feed hungry kids in the process."  All proceeds went toward Secret Meals for Hungry Children, a program that identifies children how may not have food at home when they leave school.  Residents could sell some of their own items, if they donated $30 to the cause.  Some of the items sold included computers, furniture and a piano.
  • Click to view larger image Rock Valley CU, Loves Park, Ill., treated members and non-members to hot dogs during Rochelle Hot Dog Days on Saturday, July 13.  Rock Valley President/CEO Mike Rosek, pictured here, grilled 240 hot dogs on a "hot day, but a great day."  Lori Perkins, director of marketing, noted non-members went into the branch to inquire about accounts and a few "very new members" shared with their friends in the parking lot what a great financial institution Rock Valley CU is. (Photo provided by Rock Valley CU)
    Del-One FCU, Dover, Del. hosted a mixer with the Central Delaware Chamber of Commerce on June 19 at Del-One's West Dover Corporate Center. The event included "fun, food, prizes and close to 100 people in attendance," said Amy Resh, director of marketing at Del-One.   The theme was Summer BBQ, with food catered by Where Pigs Fly in Dover. "Everyone had a great time, and Del-One FCU staff looks forward to doing it again soon," she said.
  • Greylock  FCU, Pittsfield, Mass., is joining WUPE/WNAW Radio in sponsoring the North Adams "Party in the Park" each Thursday during July and August. Free concerts entertain the public from 6 p.m to 8 p.m. at Noel Field. The event also features a display each week of antique and customized cars. "The combination of live music and food makes for an enjoyable evening at the park with family," said Marilyn L. Sperling, Greylock Federal president.
  • AmeriChoice FCU, Mechanicsburg, Pa., hosted its Fifth Annual Family Fun Extravaganza July 13 in Mechanicsburg. The free event included food, games, child safety kits, balloon twisting, a bounce house, photos with Dollar Dog, and a live broadcast by 99.3 KISS FM. It also included a one-day promotion offering a $25 match when a new Dollar Dog Kid's Club Account was opened for a young member, said the Pennsylvania Credit Union Association (Life is a Highway, July 12).
  • Diamond CU, Pottstown, Pa. combined fun and fundraising at its Eighth Annual Bingo Event to support the American Cancer Society Relay for Life. More than 230 players helped raise $10,000 to shouts of "Bingo" (Life is a Highway July 12).
  • TruMark Financial CU, Trevose, Pa.,  has 27 business and community leaders, professionals and teachers going "hog wild" to compete for the privilege of kissing a pig in its Third Annual Kiss-a-Pig Financial Literacy Fundraiser to support area schools with resources to teach students the basics of money management and personal finance.  TruMark Financial kicked off its fundraiser on June 26 with a luncheon for participants at a local restaurant in northeast Philadelphia. Participants will raise sponsorship money to earn the privilege of kissing a pig. Last year TruMark Financial raised $36,000 and awarded $5,800 grants to six schools. This year's goal is $40,000.
  • San Antonio's Generations FCU started the summer co-sponsoring San Antonio's Eastside Midnight Basketball League (Leaguer June 20).  The 2013 league is featuring 12 men's teams and four women's teams.  Generations served as Title Sponsors for the first season in 2012, which was hailed as an outstanding late-night alternative for more than 100 local at-risk youth. San Antonio Spurs co-sponsored that season and sent talent scouts to the games. The Spurs are the title sponsor this year, with the credit union co-sponsoring the league.
For more fun, check out the photos.  And check out the Credit Union National Association's picnic celebration items. Use the link for more information.

CU System Briefs

 Permanent link
  • ST. LOUIS (7/22/13)--Five Missouri Credit Union Association vice presidents have been promoted to senior vice presidents, announced Don Cohenour, MCUA president/CEO. The promotions became effective June 16. They include: Liz Adams to senior vice president of member relations; Amy McLard to senior vice president of advocacy; Bob Schuckmann to senior vice president of finance & technology; Barb Stanek to senior vice president of operations; and John Thomas to senior vice president of regulatory compliance. Also, Pat Behnen, vice president of administration, and Monica Burnett, vice president of human resources, will continue to report to Cohenour ...
  • BIRMINGHAM, Ala. and TALLAHASSEE, Fla. (7/22/13)--The League of Southeastern Credit Unions and Affiliates (LSCU) promoted Jared Ross to senior vice president of association services and Teresa Gray to senior director of education. The changes were made following the departure of LSCU Association Services Chief of Staff Cassandra Grayson, who is leaving to pursue a doctorate in education. Ross previously served as vice president of governmental affairs, overseeing the entire department and coordinating legislative advocacy for credit unions in Montgomery, Tallahassee and Washington, D.C. Gray is the liaison to the Southeastern Credit Union Managers Association of Alabama, where she is in charge of planning the annual meeting and educational sessions. Gray, who will report to Ross, will direct the education department, which includes two event planners and a support specialist ...
  • PLEASANTON, Calif. (7/22/13)--Erin Mendez has been named CEO of Patelco CU, announced the Pleasanton, Calif.-based credit union's board Thursday.  Mendez has 35 years of experience in the financial services sector and other industries. She will assume leadership of the $4 billion Patelco in mid-August. Mendez will move from her position as executive vice president and chief operating officer at the $9.7 billion asset Schools First FCU, based in Santa Ana, Calif., where she worked for 10 years. Previously she served as senior vice president of retail banking at American Savings Bank, senior vice president of operations and chief information officer for Western Financial Bank, and chief technology officer for Health Net Inc. ...
  • HARRISBURG, Pa. (7/22/13)--Belco Community CU President/CEO Lonny J. Maurer celebrated 40 years of service with the Harrisburg, Pa.-based credit union on July 2.  He began his career at Belco on July 2, 1973, as the assistant manager at the credit union's former downtown Harrisburg branch and became general manager on Jan. 15, 1974.  Maurer has been involved in many credit union-related activities with the Pennsylvania Credit Union Association and the Credit Union National Association and other local affiliated organizations.  Belco Community, which has more than $388 million in assets and more than 51,500 members,  will celebrate its 75th anniversary in 2014 ...

Special Report: TopLine FCU Members 'Change' Savings Habit With SaveUp Program

 Permanent link
MAPLE GROVE, Minn. (7/22/13)--TopLine FCU, Maple Grove, Minn., put a new spin on the old idea of saving spare change to help members establish emergency savings accounts.
 
Instead of encouraging members to toss their spare change into an old Mason jar to build up savings, Topline FCU automatically transfers change into a savings account for members with its Sum-It-Up Savings Program.
 
Each time TopLine members who enroll in the transfer program make a purchase or ATM transaction with their TopLine Check Card, the total is automatically rounded up to the nearest whole dollar--and the difference is transferred into their savings account. TopLine's members add slowly and steadily to their savings, by using the debit card for everyday purchases.
 
"We wanted to design a program that was innovative and easy for our members to save," said Vicki Roscoe Erickson, Topline FCU assistant vice president of marketing. "We promoted it to help members save for an emergency fund, start a children's saving account, or just to start a fun money account."
 
About 1,000 members have enrolled in the program, Erickson told News Now. Since the program's introduction in June 2011, members have saved about $250,000. On average, members in the program combined save nearly $12,000 per month, Erickson said.
 
"Several of our members have saved nearly $500 on an annual basis using the program," she added.
 
During the program's roll out, TopLine promoted it through every channel, reaching out to members with branch merchandising, front-line staff, direct mail, on-hold messaging and direct mail.
 
Members notified the credit union of their wish to participate.
 
"It  just takes a virtual a flip of the switch within our core system to make the change on a member's account," Erickson said.
 
Many members have commented on how easy the program makes saving. "Almost everybody uses their debit card for everyday purchases," she said. "That means every time you use that card you're generating saving. When members see that, they say, 'Wow I already have $20 or $30 bucks in here.' Over the course of a year that adds up."
 
This article is part of a News Now series of exclusive, special reports on credit unions' outreach efforts and innovative ideas. Fostering service excellence and raising awareness about the value credit unions provide their members and communities are two prongs in credit unions' Unite For Good campaign toward a vision in which Americans choose credit unions as their best financial provider.

W.Va., N.Y., And More Talk 'Don't Tax My CU'

 Permanent link
MADISON, Wis. (7/22/13)--Leagues and credit unions have stepped up their visits and letters to lawmakers in their effort with the Credit Union National Association to persuade Congress to "Don't Tax My Credit Union."
 
With less than a week's notice and temperatures soaring in the high 90s, West Virginia Credit Union League representatives took the "Don't Tax My Credit Union" message directly to lawmakers and their key staff Thursday.
 
Click to view larger image During the West Virginia Credit Union League's and state credit unions' visit to Capitol Hill Thursday to advocate preserving credit unions' tax- exempt status, the group stopped by Sen. Joe Manchin's (D-W.Va.) office. From left are Kirten Mehta, Manchin's general counsel; Bob Burrow, CEO of Bayer Heritage FCU, Proctor, W.Va.; and Mike Tucker, CEO of West Virginia Central CU. (Photo provided by the West Virginia Credit Union League)
League President Ken Watts; Proctor, W.Va.-based Bayer Heritage FCU CEO Bob Burrow; and West Virginia Central CU CEO Mike Tucker converged on Capitol Hill to talk about preserving the credit union tax exemption, which was established by Congress in 1917 and reaffirmed several times, said the league.
 
"Our meetings on the Hill today were very positive," said Watts, adding that Sen. John "Jay" Rockefeller (D-W.Va.), who sits on the Senate Finance Committee, "reaffirmed his strong support for the tax exemption through his legislative director."
 
Watts noted that the legislative process "is all really fluid at this point, and we want to leave no doubt with West Virginia lawmakers where we stand on this issue."
 
Credit Union Association of New York President/CEO William J. Mellin wrote a letter to Sens. Charles Schumer and Kirsten Gillibrand, both Democrats, to urge the two credit union supporters "to make the preservation of the credit union tax-exempt status a top priority in any legislation to revise the tax code."
 
Pointing out that credit unions already pay property and payroll taxes, Mellin said that ending tax exemption from corporate income taxes  "would be tantamount to killing the industry. At a time when people are still concerned that too-big-to-fail banks are not being held accountable for their mismanagement, credit unions offer New Yorkers a means of supporting community-based, member-run institutions where their influence isn't dependent on how many shares they can buy."
 
He wrote that the financial and social benefits that credit unions provide are far greater than the amount of money that would allegedly be generated by taxing credit unions.
 
In Pennsylvania, U.S. Rep. Mike Kelly (R-Pa.), a member of the House Ways and Means Committee, which has direct oversight of tax code reform, hosted a conference call with Mary Beth Wilcher, CEO of Erie (Pa.) FCU and Dave Ackerman, president/CEO of USX FCU, Cranberry Township, to discuss credit unions' tax status and regulatory concerns.
 
The taxation discussion focused on the structural differences between credit unions and banks, the benefits of credit union membership, and the direct and indirect effects of taxing credit unions, said the Pennsylvania Credit Union Association (Life is a Highway July 15). Kelly is a support of regulatory relief legislation and has publicly voiced concerns about burdensome regulatory environment that smaller financial institutions like credit unions face.

CUNA and the leagues have made more than 406,000 contacts with lawmakers on the issue, as of July 18. To help get the "Don't Tax My Credit Union" message across, 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.  See News Now's related story, CUNA: Don't Miss Out on 'DontTaxMyCU Tuesday.'

Study: Big Banks Could Lose $92B In Deposits In 2014

 Permanent link

WILTON, Conn. (7/22/13)--Twenty-six percent of customers at the nation's top 10 national retail banks expressed frustrations about their primary bank in a new study that projects the banks will lose $92 billion in deposits next year while consumers transfer their accounts to credit unions and community banks.
 
Nearly two-thirds (63%) of consumers surveyed said they believe banks merely claim to have consumer interests at heart when in fact they only care about the bank's interest.
 
The study means that credit unions still have plenty of opportunity to pick up more membership--as they did when customers' dissatisfaction with bank fees in 2011 led to Bank Transfer Day, with consumers transferring their accounts to credit unions and community banks, said the Credit Union National Association.
 
Credit unions picked up more than 2.2 million members in 2011 and 2012. CUNA's and the state leagues' Unite for Good campaign is working toward the vision in which "Americans choose credit unions as their best financial partner."
 
The study, by Wilton, Conn.-based cg42, cited broken promises, being nickeled and dimed, and getting hit with unexpected overdraft charges and fees as reasons consumers may move their accounts.

Cg42 said the frustrations expressed by 26% of customers surveyed mean that a projected $627 billion in customer deposits is in jeopardy (or "in play") at the top 10 banks, with $92 billion expected to walk out of the branches.

Bank of America, the most vulnerable brand in 2011 thanks to the unpopular debit card fee that prompted the Bank Transfer Day movement, now ranks as the third most vulnerable bank. Citibank took over the most-vulnerable spot and stands to lose the highest percentage of deposits and customers. In the current study, TD Bank has the lowest brand vulnerability score, replacing PNC, the least vulnerable bank in 2011.

"Customers still feel that their financial institutions aren't serving their best interests and they're frustrated," said Stephen Beck, founder and managing partner of cg42. "Comparing the brand vulnerability of big banks from 2011 to today shows that while the industry suffers from many of the same frustrations, institutions that addressed their customers' concerns significantly improved their competitive position in 2013."
 
Other key findings from the study show that:

  • 15% of vulnerable customers are actively looking to switch their primary bank  while 11% are very frustrated, but not actively looking to switch;
  • 11.4% of Citibank's customers are expected to defect and move $18 billion in deposits to another institution in the next year, which will need to be offset by new customer acquisition efforts;
  • 63% of customers believe that banks merely claim to have consumer interests at heart but in fact only care about their own interests, an improvement from 2011, when 71% believed this to be the case; and
  • 55% of customers in 2013 are uncomfortable with how large the major banks have become compared with 50% in 2011.

Filene Report: Mine Big Data To Predict Member Behavior

 Permanent link
MADISON, Wis.  (7/22/13)--Credit union members follow simple paths during their life cycle and adopt different consumer products at each stage, according to a new Filene Research Institute report.
 
The report, "Big Data and Credit Unions: Machines Learning in Member Transactions," by Phillip Kallerhoff, shows that some simple patterns evolve using big data and machine learning--a branch of artificial intelligence that focuses on the construction and study of systems that can learn from data.
 
Five credit unions in the U.S. and Canada offered their members' anonymous profile information and transaction details to the researcher, who used variables as diverse as gender, product balances, credit score, income and transaction amounts--big data--to search for revealing correlations to predict member behavior.
 
Companies such as Amazon, Google, Walmart and Wells Fargo are turning to big data for insights that will help them serve customers and capture market share. Big data is the analysis of huge data sets. While individual credit unions may not have the resources of a corporate giant, advances in data storage and software tools mean that credit unions can start using similar tools and deriving similar value, the report said.

The five credit unions in the study each looked for different information, and the plasticity of big data means that, with the right tools and the right inputs, they could discover different insights. Because a machine learning project is only as helpful as the data that flow into it, the credit unions got more specific insights. But their combined data still offer generalizable findings for all credit unions.

Some key findings of the report were:
  • Credit unions can mine members' transactional data to predict member behavior and product life cycles, improve profitability and reduce risk.
  • The relationship between health and finances can be used as an example of looking at external factors to predict member behavior.
  • Applying machine learning to transaction data helps credit unions identify and leverage the paths that members follow.
  • Big data add another dimension to credit scores, allowing lenders to improve underwriting and use transaction information to take different risks on members than a standard credit score allows.
To access the report use the link.

CUNA Council Paper Discusses Lending Technologies

 Permanent link
MADISON, Wis. (7/22/13)--Lending and information technology staff must work together with colleagues from other departments to identify solutions that cost-effectively deliver on members' expectations for easy, convenient access to credit, according to a joint white paper by the CUNA Lending Council and Technology Councils.
 
"Partners in Progress:  How Lending and IT Work Together to Improve Efficiency and the Member Experience" presents examples of recent steps forward in lending operations powered by technology, including mobile lending, more secure credit cards, and paperless mortgage and consumer lending.
 
Among the case studies explored in the paper is Royal CU's efforts to optimize its new mortgage lending software. Royal CU, based in Eau Claire, Wis., identified two strategies for its initiative: To revise its internal processes to capitalize on new system capabilities and to "find a partner invested in [our] success," said Erik LeMay, enterprise solutions manager for the $1.3 billion asset credit union serving 147,000 members. "Software is software, but a partner is success."
 
The credit union's aim to refine its mortgage processes to get the most from Mortgage Cadence's Symphony software is consistent with its adoption of the Six Sigma process improvement and quality-management methodology. Six Sigma is characterized by a commitment to produce measurable financial returns, an emphasis on strong management support, project leadership by internal experts, and data-based decision making.
 
Adopting this methodology has helped Royal CU focus on efficiency, on doing it right the first time, and on minimizing variance in its processes, LeMay said. In the case of its new mortgage lending software, the approach helped the credit union steer clear of customizing that might have sacrificed efficiencies built into the system.
 
A primary goal in the search for new mortgage software was to reduce turn-around time to 30 days or less from application to closing. Other key aims were improving the application process for members and employees entering data, accommodating interruptions in loan processing without derailing the loan, replacing paper loan files with e-documents, and providing an online portal so members could follow the progress of their loan.
 
The credit union piloted the Symphony system in May 2013 and went live the following month.

The mortgage software is a first step toward another goal Royal CU has set--to create a unified experience that "allows members to end up with the same result, regardless of how they started the process," LeMay said.

45 CU Leaders Graduate From SCMS

 Permanent link
FARMERS BRANCH, Texas (7/22/13)--Forty-five credit union leaders graduated from the Southwest CUNA Management School (SCMS) Wednesday, the Cornerstone Credit Union League said.
 
The three-year program, held on the campus of Texas Christian University (TCU) in Fort Worth, Texas, develops and enhances the management skills of credit union professionals (The Leaguer July 19).
 
"You are the future leaders of the credit union movement," Shannon Shipp, a professor in TCU's M.J. Neeley School of Business and the academic liaison between the university and SCMS, told the 41st graduating class. "TCU is proud to have hosted you during your three years in the program."
 
SCMS provides participants with a perspective of credit union management and operations, practical experience through the development of a strategic-plan, and opportunities to enhance professional presence through communications, presentations and networking.
 
Eight graduates were award recipients. They included:
  • Kelly Barrow, TTCU The Credit Union,  Tulsa, Okla., honors;
  • Thomas Green, Amoco FCU, Texas City, Texas, honors;
  • Lorraine Henderson, Beacon FCU, La Porte, Texas, honors;
  • Gregory D. Inman, Neighbors FCU, Baton Rouge, La., honors ;
  • Millicent Mayaka, InTouch CU, Plano, Texas, award of excellence;
  • Suzanne M. Peterson, Resource One CU, Dallas, honors;
  • Brad A. Scheit, Oklahoma Central CU, Tulsa, Okla., honors; and
  • Michael Walls, CUNA Mutual Group, honors.
For a full list of graduates, use the link.

CU System Briefs (07/19/2013)

 Permanent link
  • ST. JOSEPH, Mo. (7/19/13)--A former teller has been charged with stealing nearly $20,000 from St. Joseph, Mo.-based Goetz CU to finance gambling.  Christie Lynn Young, 43, a former teller and member service representative who had worked for the credit union for 22 years, allegedly stole $19,965 between Jan. 2 and July 3 by moving money from her cash drawer to her account and falsifying records. She has been charged with one count of stealing, a Class C felony. Young allegedly told police she used the stolen money to gamble (St. Joseph News-Press July 16) ...
  • MONTPELIER, Vt. (7/19/13)--Steve Post, the CEO of Vermont State Employees CU, the state's largest state-chartered credit union, has announced he plans to retire after 23 years at the helm of the Montpelier, Vt.-based credit union. Post was appointed CEO in 1990. He previously served as general manager at White River CU, Rochester, Vt.  Post served as chairman of the Association of Vermont Credit Unions Government Relations Committee and has been an active voice with regulators and legislators. Under his leadership, the credit union grew to more than $600 million in assets from $80 million and expanded its field of membership from an employee-based to a community-based credit union serving more than 50,000 members,. He also expanded branch operations to seven locations and developed a full-service online distribution channel. VSECU's board has retained Cope & Associates, Burlington, Vt., which already has begun the process of working with Post and the senior executive team to prepare for a successor ...
  • RIVERSIDE, Calif. (7/19/13)--Altura CU, a $718.2 million asset credit union based in Riverside, Calif., is rolling out a new fleet of envelope-free ATMs throughout  Riverside County. Its branches in West Hemet, Indio, Rancho Mirage and Murrieta are the first to install the ATMs. The changeover will continue to all 35 of Altura's ATMs through the end of the year. "Member convenience was the driving factor" behind the decision, said Altura CEO Mark Hawkins. "We focus on listening to what our members want, and it was clear they were seeking more convenient and environmentally friendly ATMs."  He pointed out that the ATMs are "a boost for the environment. Since these new envelope-free ATMs were first launched, they are estimated to have eliminated hundreds of millions of paper envelopes, saving trees." Also, gas use and emissions decreased because remote ATMs do not need to be serviced as frequently, Hawkins said ...
  • MELBOURNE, Fla. (7/19/13)--Space Coast CU has honored four auto dealers with its 2012 Watchdog Dealer Of The Year Award for superior service to SCCU members. The dealers are Rosner Chevrolet for Brevard and Indian River Counties; Braman Honda for Miami-Dade County; AutoNation Chevrolet of Pembroke Pines for Palm Beach and Broward Counties; and Deland Kia for Volusia and Flagler Counties. The awards were based on survey ratings from credit union members and on the total auto loans they generated for SCCU.  Rosner Chevrolet received 4.78 stars out of a possible five stars and facilitated more than $12 million in auto loan production for SCCU. Braman Honda earned five stars and facilitated more than $5 million. AutoNation Chevrolet received 4.6 stars and facilitated more than $2 million, while Deland Kia earned 4.6 stars and facilitated more than $12 million in auto loan production with SCCU. SCCU's Watchdog program's philosophy is to watch out for members' best interests ...

Two Canadian Co-op Groups Plan Bilingual Organization

 Permanent link
EDMONTON, Alberta (7/19/13)--Two Canadian French- and English-speaking national cooperative associations plan to create a single bilingual organization to represent co-ops, credit unions and mutual insurance companies in every region of Canada.

The new organization, tentatively called Co-operatives and Mutuals Canada, will launch in early 2014 and will take over the domestic mandates of the Conseil canadien de la cooperation et de la mutualite (CCCM) and the Canadian Cooperative Association (CCA). 

CCA will continue to exist but will be responsible only for international cooperative development activities, said the announcement on the 2014 International Summit of Cooperatives website (July 3).

"This is not a merger; it is a creation of an entirely new organization to represent all cooperative enterprises across Canada," said Bill Dobson, CCA's newly elected president. "This will significantly strengthen the Canadian cooperative movement; it will allow cooperatives, credit unions and mutual to speak with one voice, in both of Canada's official languages."

The vote took place at a joint Congress of CCA and CCCM in Edmonton, Alberta, June 26-28. Canada has more than 9,000 cooperatives with 18 million members and 150,000 employees.

Sinek Puts CU Leadership Under the Microscope

 Permanent link
MADISON, Wis. (7/19/13)--While most people are familiar with the psychological side of corporate leadership, Simon Sinek, author of "Start With Why: How Great Leaders Inspire Everyone to Take Action," offered a glimpse of the biology behind decision making during the closing session Wednesday of the World Council of Credit Unions' World Credit Union Conference in Ottawa, Canada, Wednesday.
 
Click to view larger image Simon Sinek opted for a flipchart rather than a PowerPoint presentation during his World Credit Union Conference closing session in Ottawa, Canada, Wednesday. Sinek gave a crash course on the brain's chemicals and how a balance of endurance, accomplishment, pride, trust and safety in the workplace lead to optimal performance.
"Inside our bodies are incentives trying to encourage us to repeat behavior that is in the best interest of ourselves and of our groups," said Sinek, who is best known for his theory of the "Golden Circle," a naturally occurring pattern that is grounded in the biology of human decision making and explains why we are inspired by some people and organizations more than others. "We are naturally cooperative animals when we are in the right environments," he said.
 
Through a crash course on the brain's endorphins, dopamine, serotonin and oxytocin, Sinek revealed that human beings perform best together when they all experience a balance of endurance, accomplishment, pride, trust and safety in the workplace. Leaders, he said, become responsible for instilling this type of work environment at their credit unions.
 
Click to view larger image World Council of Credit Unions Director Patrick Jury, master of ceremonies at Wednesday's session at the 2013 World Credit Union Conference, thanked the sponsors of the event. (Photos provided by the World Council of Credit Unions)
"If you want to enjoy the perks of leadership, you must be willing to sacrifice yourself to protect your people," Sinek said. "The best leaders are the ones who act like parents. What do we want as parents? We want to provide opportunity, education and discipline as necessary, all so that our kids can grow up and achieve more than we ever thought was possible for ourselves. It's the exact same thing for a good boss. We commit ourselves to protection and love, and give our time and energy to see that our employees do well."
 
Although the world is constantly filled with danger, Sinek said, the dangers felt inside credit unions are variable. When employees feel safe internally, the chemicals for happiness are balanced, which leads to cooperation, trust, innovation and progress. Work environments in which staff feel unsafe are dangerous to the well-being of employees and the credit union as a whole. Stress, which releases a hormone called cortisol, is contagious and leads to paranoia and self-interest, hampering the desire to protect and cooperate with each other.
 
"Our jobs are literally killing us because we're not feeling safe," Sinek said.
 
One of the best ways to reduce stress is empathy, Sinek continued. "Do something nice for someone. Instead of sending an e-mail, pick up the phone. The care and time you give is the only way to actually share these good feelings. It makes you healthier, happier and inspires people to help you."
 
Prior to the general session, attendees explored leadership challenges in emerging credit union systems, social media marketing, grassroots advocacy, strategic financial planning and wealth management for members during morning breakout sessions.

NEW: Study: Big Banks Didn't Address Fees, Could Lose $92B Deposits In 2014

 Permanent link

WILTON, Conn. (7/19/13 UPDATED 1:30 p.m. ET)--Twenty-six percent of customers at the nation's top 10 national retail banks expressed frustrations about their primary bank in a new study that projects the banks could lose $92 billion in deposits next year as consumers transfer their accounts to credit unions and community banks.
 
Nearly two-thirds (63%) surveyed said they believe banks merely claim to have consumer interests at heart when in fact they only care about the bank's interest.
 
The study means that credit unions still have plenty of opportunity to pick up more membership, as they did when customers' dissatisfaction with bank fees in 2011 led to Bank Transfer Day, in which consumers transferred their accounts to credit unions and community banks, said the Credit Union National Association. Credit unions picked up more than 2.2 million members in 2011 and 2012. CUNA's and the state leagues' Unite for Good campaign is working toward the vision in which "Americans choose credit unions as their best financial partner."
 
The study, by Wilton, Conn.-based cg42, cited  broken promises, being nickeled and dimed, and getting hit with unexpected overdraft charges and fees as reasons consumers may move their accounts.

Cg42 said the frustrations expressed by 26% of customers surveyed mean that a projected $627 billion in customer deposits is in jeopardy (or "in play") at the top 10 banks, with $92 billion expected to walk out of the branches.

Bank of America, the most vulnerable brand in 2011 thanks to the unpopular debit card fee that prompted the Bank Transfer Day movement, now ranks as the third most vulnerable bank. Citibank took over the most-vulnerable spot and stands to lose the highest percentage of deposits and customers. In the current study, TD Bank has the lowest brand vulnerability score, replacing PNC, the least vulnerable bank in 2011.

"Customers still feel that their financial institutions aren't serving their best interests and they're frustrated," said Stephen Beck, founder and managing partner of cg42. "Comparing the brand vulnerability of big banks from 2011 to today shows that while the industry suffers from many of the same frustrations, institutions that addressed their customers' concerns significantly improved their competitive position in 2013."
 
Other key findings from the study show that:

  • 15% of vulnerable customers are actively looking to switch their primary bank  while 11% are very frustrated, but not actively looking to switch;
  • 11.4% of Citibank's customers are expected to defect and move $18 billion in deposits to another institution in the next year, which will need to be offset by new customer acquisition efforts;
  • 63% of customers believe that banks merely claim to have consumer interests at heart but in fact only care about their own interests, an improvement from 2011, when 71% believed this to be the case; and
  • 55% of customers in 2013 are uncomfortable with how large the major banks have become compared with 50% in 2011.

SECU's Fee Free Days Save Checking Accountholders $3.5M

 Permanent link
RALEIGH, N.C. (7/19/13)--State Employees' CU (SECU) in Raleigh, N.C., is offering two member-friendly initiatives--the credit union's Non-Sufficient Funds (NSF) and Overdraft Fee Free Days--which has saved its one million checking accountholders more than $3.5 million in fees in the first five months of 2013.
 
"SECU's NSF and Overdraft Fee Free Days represent the credit union's commitment to providing true consumer value and keeping our members' best interests first," said Jennifer Hamrick, SECU senior vice president of support services. "As a cooperative, the credit union works hard to develop programs that will encourage the financial success of its membership."
 
SECU already offers its members a very low $12 NSF fee. The most common NSF fee at credit unions is $30, compared with $35 at banks, Bankrate reported in March.

With NSF Fee Free Days, SECU waives all NSF fees incurred on two separate days during the calendar year. If a member miscalculates and several checks/debits present with no account funds or traditional overdraft funds available, SECU returns the items, but waives the fees on the first two days of occurrence.
 
The waivers help to alleviate some of the financial burden on members, said the $25.1 billion asset credit union.
 
Similarly, SECU's Overdraft Fee Free Days provide all checking accountholders enrolled in its no-cost-to-enroll Overdraft Protection Program with an automatic benefit of waiving overdraft transfer fees for two days in the calendar year. Overdraft funds will still be transferred from the protecting account to cover the items, but the minimal transfer fee of 50 cents per transaction is not applied. Since the program began five months ago, SECU has waived nearly 700,000 overdraft/NSF fees.
 
While the fee-free programs are tied to traditional checking accounts, SECU also offers a CashPoints Global (CPG) controlled-spending account with electronic-only access through a CPG card. There are no checks, and transactions are limited to the available funds in the account, so there is no risk of overdraft or NSF fees.
 
SECU's base share account is another alternative to avoid NSF/overdraft fees and is accessible through the credit union's more than 1,100 statewide no-surcharge CashPoints ATMs.

Cheney Comments On Cordray Nomination For USA TODAY

 Permanent link
WASHINGTON (7/19/13)--Comments by Credit Union National Association President/CEO Bill Cheney were featured in USA TODAY's story Wednesday about the Senate confirmation of Richard Cordray as director of the Consumer Financial Protection Bureau.
 
Cheney, who was the only financial industry trade representative quoted, congratulated Cordray's confirmation but noted credit unions' concern "about the impact that a number of the CFPB's regulations and proposals will have."
 
In the article, Cheney said that Cordray, as interim director, had proved "to be receptive of credit unions and particularly our concern about the impact of the actions on our cooperative financial institutions."
 
The article, "Obama praises director of consumer board," also featured extensive quotes by President Barack Obama, Cordray and Senate Majority Leader Harry Reid (D-Nev.). Use the link to access the full USA TODAY article.

Royal CU In Finals Of National Social Media Contest

 Permanent link
EAU CLAIRE, Wis. (7/19/13)--Royal CU (RCU), Eau Claire, Wis., has advanced to the national round of the Social Madness, a competition that measures a company's social media engagement.
 
RCU advanced through the Minneapolis/St. Paul local round of the competition, sponsored by The Business Journals, and is competing in the medium category, based on the size of its social media audience. A total of 132 businesses in three categories (small, medium and large) are competing for the titles. The three national winners will receive $10,000 for the charity of their choice.
 
The first round of voting will end Monday.  The top 20 vote-getters in each category will move on to the second round. The competition wraps up Aug. 19. Participants are scored on a social-media algorithm that includes votes on bizjournals.com as well as social engagement on LinkedIn, Facebook, Twitter and Google+. Social engagement is defined as likes, comments and shares of a company's posts by their followers.
 
If RCU wins the competition, it has pledged the $10,000 prize to Gillette Children's Specialty Healthcare through Children's Miracle Network Hospitals (CMN). Gillette specializes in caring for children and adolescents who have disabilities and complex medical conditions.
 
Raising funds to support CMN is a credit union industry initiative.
 
Since 1983, CMN has raised more than $4.7 billion--most of it $1 at a time--for 170 children's hospitals across the U.S. and Canada. The donations have gone to support research and training, purchase equipment, and pay for uncompensated care, all in support of the mission to save and improve the lives of as many children as possible.
 

World Council DSA Honorees, WYCUP Scholarships Recognized

 Permanent link
OTTAWA, Canada (7/19/13)--
Click to view larger image "Credit unions have such great stories to tell, and we don't tell them. But we should tell them," said Pete Crear, former president/CEO of the World Council of Credit Unions,  in accepting the World Council's Distinguished Service Award during the 2013 World Credit Union Conference in Ottawa, Canada.
The World Council of Credit Unions honored three credit union leaders from the U.S., the Caribbean, and Ireland with its Distinguished Service Awards and announced scholarships for five young credit union professionals Wednesday during the closing session of its 2013 World Credit Union Conference.
 
The conference convened on Sunday in Ottawa, Canada.
 
World Council's Distinguished Service Awards went to:
  • Click to view larger image Pat Fay, chair of the Irish League of Credit Unions International Development Foundation, in receiving a Distinguished Service Award from the World Council of Credit Unions, noted he met a young Ethiopian mother who traveled 20 kilometers in the heat to deposit 60 cents in her credit union account because she wanted to put the money aside for her child's future needs. That "confirmed to me the humanity of credit unions," he said.
    Pete Crear, former president/CEO of World Council from 2005 to 2011, former executive vice president/chief operations officer of the Credit Union National Association, and who has served in positions at the state leagues in Michigan, Connecticut and Indiana;
  • Pat Fay, for a 40-year commitment to credit unions as part of the Irish League of Credit Unions that included chairing the league's International Development Foundation and serving as a board member of the league; and
  • Click to view larger image Melvin Edwards, the first World Council of Credit Unions chairman from the Caribbean, accepted one of three Distinguished Service Awards from World Council Wednesday at its 2013 World Credit Union Conference. He now has a consultancy for cooperatives.
    Melvin Edwards, a native of St. Kitts and Nevis who was the first World Council chair to represent the Caribbean credit union, serving in that position from 2007 to 2009, and former chair of the Caribbean Confederation of Credit Unions.
Crear, in accepting his award, challenged participants to talk more about the significance of credit unions when they return home from the conference.  "Credit unions have such great stories to tell, and we don't tell them. But we should tell them," he added.
 
Also at the closing ceremony, World Council announced its World Council's Young People Program (WYCUP) scholarship award winners.  The scholarships will be used to attend the 2014 World Credit Union Conference in Gold Coast, Australia. 
 
The recipients are:
  • Click to view larger image Winners of the 2013 World Council's Young Credit Union People (WYCUP) scholarships to attend next year's World Credit Union Conference in Australia are, from left:  Benjamin Janzen, Canada; Eber Osemberge, Brazil; Caroline Domanski, the United Kingdom; Jenn Vandehaar, Canada; and Christopher Morris , U.S. (Photos provided by the World Council of Credit Unions)
    Benjamin Janzen, Mennonite Savings and Credit Union, Canada;
  • Jenn Vandehaar, Healthcare & Municipal Employees' CU, Canada;
  • Eber Ostemberg, Sicredi Noroeste MT CU, Brazil;
  • Caroline Domanski, No1 CopperPot CU, United Kingdom; and
  • Christopher Morris, director of communications at the National Credit Union Foundation, U.S.
Janzen also won the National Credit Union Young Leaders Award from Credit Union Central of Canada, the conference's co-host.

Central Canada also honored two credit unions for community economic development and innovation: Vancouver, B.C.-based  Vancity for its Resilient Capital Program that gives investors the opportunity to invest in social enterprises, and North Peace Savings and Credit Union in northern British Columbia for its Virtual Technology Connects the North program, which allows members in remote communities to conduct financial business with their credit union via personal teller machines and video conferencing technology.
 
During the week, the National Credit Union Foundation 's Credit Union Development Education program awarded International Development Educator Certifications to 12 people who completed training in multiple countries and who are active in the international credit union system.

Texas Regulator To Disclose CAMEL Ratings To CUs

 Permanent link
AUSTIN, Texas (7/19/13)--Texas state-chartered credit unions will be told what their CAMEL codes are, beginning in September, the Texas Credit Union Department said Wednesday.
 
"[The move] is just a byproduct of the fact that we haven't disclosed CAMEL codes for several years, but the National  Credit Union Administration does [to credit unions]," Robert Baxter, chief examiner for the Texas Credit Union Department, told News Now. "So we thought it was good for credit unions to know where we were coming from.
 
"We are getting credit unions who did not know they were a problem to get on board," he added. "It was time to start changing policies and important for us to be in the driver's seat."
 
The CAMEL rating system is NCUA's method of evaluating the health of credit unions. The rating, adopted by the NCUA in 1987, is based upon five critical elements of a credit union's operations: (C) Capital, (A) Asset quality, (M) Management, (E) Earnings and (L) Asset liability management.
 
"Sharing the CAMEL codes with boards of state-chartered credit unions will benefit Texas credit unions," Suzanne Yashewski, senior vice president and regulatory compliance counsel for the Cornerstone Credit  Union League, told News Now. "CAMEL codes provide the board and management a metric to help monitor critical areas and recognize success."

CU's One-day Discount Brings In $1.3M In Loans

 Permanent link
MILWAUKIE, Ore. (7/19/13)--A one-day, 1% discount promotion helped Clackamas FCU, Milwaukie, Ore., attract $1.3 million in consumer loans June 21.
 
A typical Friday would bring in about $90,000 in originated, secured consumer loans balances, the $250 million asset credit union said.
 
"To see this success for our members is extremely rewarding," said Andrew Vahrenkamp, Clackamas FCU chief financial officer. "This promotion is mutually beneficial to our members and the local communities--enabling us to give back a significant amount of money to the areas we serve."
 
The discount was available for any vehicle or secured consumer loan of $10,000 or more.
 
The summer traditionally brings families added expenses such as vacation costs and recreational fees, Vahrenkamp said. Clackamas created the special one-day offer to help members save money, he added.

Montana CUs Champion Relay For Life

 Permanent link
HELENA, Mont. (7/19/13)--Hope is the foundation of the Relay for Life--the largest fundraiser for the American Cancer Society--and Montana's credit unions have collectively made a substantial impact in recent years, according to the Montana Credit Union Network.

"Everybody has been affected by cancer," said Ryan Combs, co-chair of the Billings-based Altana FCU Relay for Life team. "So many people pour their heart and soul into this fundraiser because they want to see a cure so badly that they are willing to do whatever it takes."

Fergus FCU has been involved with the Relay for Life since it began in Lewistown 11 years ago. Its team raises funds through events, including a Bunco tournament, bake sales, root beer float Fridays, picnics and raffles. Typically their efforts generate about $5,000 but their record for one year is $14,000.

The original Relay for Life started in 1985 with one man, Gordy Klatt, who wanted to show what someone fighting cancer endures. He ran around a track for 24 hours and raised $27,000. A year later, 340 supporters joined the overnight event and today it's caught on worldwide. Thirty-four Montana communities are holding Relays this summer.

In Circle, Relay for Life was started with the help of staff at McCone County FCU. This year, 10 teams in the community have already raised nearly $14,000. This is the second year that McCone County FCU has had its own relay team.

Fundraising efforts are varied and tailored to each community. Some have organized summer barbeques and gift-wrapping at the holidays with free-will donations. Others offer raffles for trips or motorcycles.

The Giant Springs Chapter of Credit Unions sponsored ice cream sales that every credit union participated in this year, raising more than $1,800. Lael Humble with Montana First FCU in Missoula said the ice cream sales were a big hit. Additional money raised from other collected donations and book mark sales brought the total to $2,750.

In Livingston, the Sky FCU Super Heroes Team is looking to raise $2,000 this year. Staff at High Peaks FCU in Sheridan is on Team Rudy, which raised more than $9,500. In the past five years, Park Side FCU in the Flathead area has donated nearly $9,000, and Altana FCU more than $100,000.

Unity One CU Launches Staff 'Walk the Talk' Program

 Permanent link
FORT WORTH, Texas (7/19/13)--Unity One CU in Fort Worth, Texas, has rolled out a new staff program--"Walk the Talk"--aimed at nurturing the internal culture and increasing employee engagement as part of a three-year strategy, says the Cornerstone Credit Union League.

"The goal of Walk the Talk is to recruit, retain and recognize valued behavior that, we feel, will positively affect co-worker and member relationships," said Erayne Gee Hill, Unity One CU assistant vice president of community and public relations, in the  Leaguer newsletter (July 18).

Organizations and companies "spend tons of time and resources externally but fail to address or recognize internal triumphs or challenges," she told the league, adding that "no house can stand without a solid foundation. It must be properly maintained.
 
"This is especially relevant to credit unions that place member service as a priority. When our staff is knowledgeable, confident, positive and responsive, the member experience is elevated. And, member satisfaction directly impacts the bottom line," she said.
 
Walk the Talk, which launched last week,  involves an everyday recognition initiative--the Walkie program--where "employees can give each other a pat on the back when they see behavior that is 'on brand,'" Hill said.  Employees submit a Walkie on a customized landing page. A Walkie is equivalent to a dollar and can be redeemed for Lands End logo-wear or other accessories. The credit union will expand rewards as the program matures.
 
"We have had 40 submissions so far, which can be attributed to the program's novelty, but we are hopeful that the trend will continue," she told the Leaguer.

The $189 million asset credit union also redesigned its employee newsletter to be brand consistent and engaging, and conducted research and sought feedback to prepare for the campaign. "Walk the Talk is really an employee project--it is a reflection of the group's needs and wants."

In August,  Unity One FCU will form a task force of brand champions to meet regularly and make decisions about the credit union's culture.  Its first project: Re-evaluating the dress code.

The campaign also includes training and communications, with regular staff roundtables to reinforce product and service offerings. Town halls and video conferences with the CEO are in the works."

The program's success "will have a direct correlation with quality member service," she said. "Confidence or self-assurance is one of our core values, and one way for that to happen is to be knowledgeable." By changing its training and internal interaction format, "we can address different types of learners."

She advised credit unions wanting to improve internal communications to use both in-person and video town hall meetings regularly, staff training roundtables, employee newsletters and the credit union's Intranet.

Selected as a Texas Best Place to Work in 2012 and 2013, the credit union is "aiming for 2014 and beyond," Hill said.

CU System Briefs (07/18/2013)

 Permanent link
  • ST. LOUIS, Mo. (7/18/13)--The Missouri Corporate CU, Missouri Credit Union Charitable Foundation and the Missouri Credit Union Association have established a memorial fund in honor of state credit union champion and attorney Leon Kusnetzky, who died May 14. The fund encourages the growth and initiatives of small credit unions and helps sponsor scholarships for the Credit Union Development Education program.  Kusnetzky's work for and in credit unions dates back to the 1960s. His firm, Kusnetzky, Schwartz, Rosenfeld, Sailler & Lilla, helped improve legislation affecting the state's credit unions. He helped with credit union bylaws and the development of credit union service organizations (CUSOs)  in the state.  He defended credit unions against lawsuits, navigated bankruptcy litigation, set up policies and analyzed contracts. He also worked to help small credit unions in a tough regulatory environment by sponsoring the small credit union CUSO, said MCUA. In 2012 he was inducted into MCUA's Honor Roll, a distinction given to people who go above and beyond in their service to the state's credit union movement ...
  • WHEATON, Ill. (7/18/13)--Hermila Garcia, 24, was sentenced to jail time and probation for stealing more than $3,000 from Dupage County Employees CU in Wheaton, Ill. She also must pay back the $3,875 she allegedly took from the $16 million asset credit union, the judge ruled. Before Garcia's September arrest on felony theft charges, she was a teller at the credit union for seven years. The thefts--in which Garcia allegedly took money from her drawer last summer and falsely filled out paperwork indicating she had deposited the money into the credit union's vault--were discovered after an audit, authorities said. Last week, Garcia pleaded guilty to felony theft and was sentenced to 24 days on jail work release and restitution, and two years of probation, court records indicated (Daily Herald July 16) ...
  • HARRISBURG, Pa. (7/18/13)--Gene Biddle, former CEO of Spring Mill Employees FCU, Roaring Spring, Pa, died July 14, the Pennsylvania Credit Union Association said (Life is a Highway July 17). He was 78. Biddle served as the credit union's CEO/general manager until June. He was also an employee of Appleton Papers for 40 years. A funeral was held Wednesday ...

Grzegorz Bierecki Named World Council Chair

 Permanent link
OTTAWA, Canada (7/18/13)--Grzegorz Bierecki, president/CEO of the National Association of Co-operative Savings and Credit Unions (NACSCU), Poland's credit union trade group, has been named chair of World Council of Credit Unions' board of directors.
 
Click to view larger image Incoming World Council Chair Grzegorz Bierecki, left, of Poland receives the chain of office from outgoing Chair Manuel Rabines during a general session at the World Credit Union Conference.
Bierecki succeeds outgoing chair Manuel Rabines, general manager of Federacion Nacional de Cooperativas de Ahorro y Credito del Peru (FENACREP). Bierecki formally accepted the chair's chain of office during the World Credit Union Conference general session Tuesday in Ottawa.
 
"A very long time ago, I chained myself to credit unions," said Bierecki, a Solidarity activist who was jailed for his political activity under Communist rule. "It was 24 years ago when I saw these words describing the credit union philosophy on the wall of a Kansas building: 'Not for profit, not for charity, but for service.' It was [with] this sentence that my study of credit unions began."
 
Click to view larger image "Working together with international institutions developing regulations, influencing credit unions and supporting their work, said incoming World Council Chair Grzegorz Bierecki. "That is the task that no one will perform better than the World Council of Credit Unions."
Bierecki has played a key role in the rebirth of Poland's credit unions--or SKOKs as they are known in Poland--which in the course of 15 years became the largest non-bank financial network in the country. Bierecki has led Poland's credit union system as president of NACSCU since 1992. Today, 55 credit unions in Poland serve 2.6 million members under a unified marketing brand from a central back-office platform.
 
"Credit unions are an example of love acting in the economy," Bierecki told the audience as he applauded their dedication toward helping others. "If love is intelligent, it can find a way to act that is prudent, right and profitable. I ask that you do not ever run out of such a love."
 
Click to view larger image World Council of Credit Unions' 2013 annual general meeting included member organization delegates from more than 30 countries. (Photos provided by the World Council of Credit Unions)
New World Council directors at the 2013 annual general meeting Monday afternoon included Oswaldo Oliva Vidal, CEO of Federacion Nacional de Cooperativas de Ahorro y Credito de Guatemala, who was elected, and Steven Stapp, president/CEO of San Francisco FCU, who was appointed by the Credit Union National Association (CUNA).
 
World Council also recognized its new direct member association, the Islamic Investment and Finance Cooperatives Group of Afghanistan, at the annual general meeting. New associate members included the Credit Union Executives Society and The Members Group, both in the U.S.
 
World Council presented member awards to recognize growth in assets and membership in 2012. The Outstanding Asset Growth Award went to Confederacao Interestadual das Cooperativas Ligadas ao Sicredi of Brazil. Outstanding Membership Growth Awards went to CUNA for highest absolute growth and to Kenya Union of Savings & Credit Co-operatives (KUSSCO) for highest relative growth.
 
CUNA was honored for achieving its highest membership growth numbers in decades. KUSCCO received the award for relative membership growth during a period when many countries in the region were experiencing a slowdown in membership growth.
 
The World Credit Union Conference ended Wednesday.

CUs Overwhelmingly Preferred By Financially Savvy Consumers, Poll Shows

 Permanent link
LOS ANGELES (7/18/13)--Financially savvy consumers overwhelmingly choose credit unions as their preferred institutions, says a new GoBankingRates.com poll, and that is no surprise, says Paul Gentile, Credit Union National Association executive vice president of strategic communications and engagement.
 
"For users of financial services, it's all about trust--and the credit union model, as a cooperative operating on a not-for-profit basis with no shareholders--engenders the trust among consumers and small business customers," he told GoBankingRates.com (July 17).

Among those polled on the GoBankingRates site and its partner sites--US News, Boston.com, AL.com and The City Wire-- more than 73.76% of poll respondents choose credit unions as their preferred institutions. Local community banks distantly followed, being preferred by 14.18%, national banks by 9.93%, and other institutions by 2.13%.
 
The publication also featured an explanation by Andrew Schrage, personal finance journalist and co-owner of blog Money Crashers Personal Finance, who noted he used to have an account at a national financial institution but pulled it when he ran into bad customer service.  Like 2.2 million other banking customers since 2011, he moved his money to a credit union.
 
Credit unions still have more work to do, however. A more general survey found that credit unions are still a long way to becoming the average person's primary financial institution, said GoBankingRates.com's poll of more general consumers.
 
That's all the more reason for credit unions to Unite for Good by providing service excellence, raising awareness about the benefits of credit unions and eliminating barriers--such as banks' attacks on credit unions' tax-exempt status and their attempts to limit credit unions' ability to offer member business loans, said CUNA.  This three-pronged campaign is working toward credit unions' shared strategic vision in which "Americans choose credit unions as their best financial partner."

Use the links to access the GoBankingRates.com article and learn more about the Unite for Good campaign.

Filene Tracks Race For Highest Credit Score For Fin Ed Efforts

 Permanent link
MADISON, Wis. (7/18/13)--The Filene Research Institute launched a study to investigate the establishment and trajectory of a credit score--starting from an initial FICO score of zero.
 
The Great Credit Race will follow the use of a Visa credit card by 20 individuals who have no established FICO or a zero score for six months to ascertain key variables that affect the score's opening growth.
 
As part of Filene's i3 program, two member credit unions--Del Norte CU, Los Alamos, N.M., and Dupaco Community CU, Dubuque, Iowa--will pilot the study in an effort to crack the code on how credit scores experience an uptick from score inception.   
 
"The great conundrum is that it's really hard to get credit if you have no credit score," said George Hofheimer, Filene's chief research and innovation officer. Since considerable weight is put on revolving credit for credit score determination, the Great Credit Race has made using a credit card the crux of the study.
 
"Unveiling some of the initial triggers, both positive and negative, on a credit score could be groundbreaking for consumers who struggle with home and car ownership, rental ability, and even job acquisition," Hofheimer added.
 
"The Filene study is quite unique in its perspective," said Denise Wymore, Del Norte vice president of member loyalty. "We know what types of behaviors raise or lower scores on established credit scores, but it's really a mystery as to what behaviors actually help build a score from the ground up."
 
The study also will provide insights into more effective ways of helping consumers understand money, according to David Klavitter, Dupaco senior vice president of marketing.  "It's the role of credit unions to improve our members' overall financial well-being," he said. "Better financial education is critical."
 
Participants in the study will receive a Visa credit card with a $500 limit and are told they must make monthly payments in a timely manner and cannot exceed the set limit. On the last day of each month, each credit union will do a soft pull of the credit score via TransUnion. On the 180th day of the race, the individual with the highest score will be deemed the winner and receive $500.
 
"The insight gleaned from this study may give consumers a real step up in the credit game, helping them establish habits that will open the doors to better opportunities and lives," said Hofheimer.
 
Other i3 credit unions contributing to the project include Elevations CU, Boulder, Colo.; Leaders CU, Jackson, Tenn.; Vancity CU, Vancouver, B.C.; and Xceed Financial CU, El Segundo, Calif. Currency Marketing of Chilliwack, B.C., is providing marketing support and guidance.

Li To World's CUs: Social Media Use Is All About Relationships

 Permanent link
Click to view larger image "Social media is going to exist whether credit unions choose to be there or not, making engagement the only way to sway negative comments," social media and technologies expert Charlene Li told the World Council of Credit Unions' 2013 World Credit Union Conference Tuesday. Social media engagement for business begins with strategic planning, she said.
OTTAWA, Canada (7/18/13)--A successful social media business strategy requires more than just the latest technologies, according to Charlene Li, social media and technologies expert and Tuesday's general session speaker at the World Council of Credit Unions' 2013 World Credit Union Conference in Ottawa, Canada.

Growing numbers of credit unions and financial institutions have experimented in social technologies, but few have incorporated them into long-term social business plans that strategically engage their members and employees.

"It's really about how you form a relationship," said Li, founder of Altimeter Group and best-selling author of Groundswell and Open Leadership. "Credit unions have a very special relationship with their members that is very unique and heartfelt in their communities. You see people in your branches, online, on your websites and on mobile phones. Soon you will see these people on your social media channels as well."

Click to view larger image "Business is social. Social is relationships," Charlene Li, social media and technologies expert, told a packed general session room at the World Credit Union Conference Tuesday in Ottawa, Canada.
With today's global media penetration at more than 50% and growing across every demographic, credit unions have an opportunity to reach and form relationships with their entire member base. Organizations must create a social strategy that connects back to their business goals, or they are destined to fail, Li said.

"If you don't know why you're using these, you should probably stop and really sit back and think, 'What is it I'm doing with my credit union? Why do I have these technologies? How do they tie back to our business goals?'" Li said.

Before any organization begins strategizing a social media plan, it must embark on what Li calls a "journey" through consecutive phases, starting with planning. By laying a foundation for the future, credit unions can evolve to reach convergence--when their social efforts align with their business objectives. Li recommended credit unions start by defining and prioritizing their top three to four long-term business goals over the next couple years, then decide how social media can help achieve them.

Click to view larger image During the audience question and answer in Tuesday's general session, Ben Janzen, stewardship in action adviser for Mennonite Savings and CU (Canada), asked Charlene Li, social media and technologies expert, for advice on how credit unions can maximize their social media efforts during business hours.  (Photos provided by the World Council of Credit Unions)
"Tools and technologies will come and go," Li said. "Your strategy has to stand the test of time."

More than 180 conference attendees spent the evening visiting one of seven credit unions throughout Ottawa. The sold-out tours included visits to Alterna Savings and CU Ltd., Buduchnist CU Ltd., Caisse populaire Rideau-Vision d'Ottawa, Frontline Financial CU, Meridian CU, Ottawa Women's CU and Your CU.

The 2013 World Credit Union Conference ended Wednesday. Wednesday's events included a closing general session presentation by Start with Why: How Great Leaders Inspire Everyone to Take Action author Simon Sinek, World Council's annual awards ceremony and a closing night reception at the Canadian Museum of Civilization.

Court Denies S&P's 'Puffery' Defense In Government's RMBS Lawsuit

 Permanent link
LOS ANGELES (7/18/13)--A federal judge in Los Angeles has refused to dismiss the federal government's lawsuit against Standard & Poor's over S&P's ratings of residential mortgage backed securities (RMBS) and collateralized debt obligations (CDOs)  prior to the nation's financial crisis.
 
U.S. District Judge David O. Carter Wednesday denied the motion to dismiss by S&P and its parent company, McGraw-Hill Cos. Inc., rejecting S&P's argument that investors should not have relied on any of its statements about the credit ratings because the statements were "non-actionable puffery" and were "couched in aspirational terms" not subject to fraud claims.
 
In the suit, the Department of Justice alleged that S&P committed fraud under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989  by inflating the ratings it gave the RMBS and CDOs. Financial institutions--including Western Corporate FCU and a credit union--invested in those instruments and suffered losses. The losses resulted in liquidation.
 
In his 18-page opinion, Carter noted that "defendants lead off with a proposition that is deeply and unavoidably troubling when you take a moment to consider its implications. They claim that, out of all the public statements that S&P made to investors, issuers, regulators, and legislators regarding the company's procedures for providing objective, data-based credit ratings that were unaffected by potential conflicts of interest, not one statement should have been relied upon by investors, issuers, regulators, or legislators who needed to be able to count on objective, data-based credit ratings."
 
The opinion noted that the government argued that "S&P's statements were not a 'general, subjective claim' about the avoidance of conflicts of interest, but rather a promise that it had 'established policies and procedures to address the conflicts of interest through a combination of internal controls and disclosure.'"
 
"It is clear that the government's complaint identifies and describes in detail examples of the CDOs for which S&P is alleged to have issued or confirmed ratings that did not accurately reflect their true credit risks," Carter wrote. "More importantly, the government's complaint alleges, in detail, the ways in which none of S&P's credit ratings represented the thing that they were supposed to represent, which was an objective assessment of creditworthiness, because business considerations infected the entire ratings process."
 
The government also argued that S&P had clear knowledge that CDOs were backed by deteriorating RMBS.
 
"The government has satisfied the heightened pleading standard ...and sufficiently pleaded both objective falsity and subjective knowledge and intent..." the court said, adding it agreed with the Ninth Circuit Court ruling that money need not flow "directly to the defendant from the party deceived by the defendant."
 
"The court finds that the government has sufficiently pleaded the intent required to support its fraud claims. Any disputes over the veracity of these claims, or contested facts, are properly challenged at a later stage of litigation."
 
The Justice Department's complaint listed 76 CDOs as examples of investments that went bad, including 11 sold to WesCorp and 26 sold to Eastern Financial Florida CU. Other losses listed including Citibank, Bank of America, M&T Bank and First Midwest (News Now Feb. 6).

CUs Earn Multiple CUAD Awards Each

 Permanent link
BISMARCK, N.D. (7/18/13)--Three credit unions were each recognized with multiple first-place awards for their community involvement and financial literacy efforts by the Credit Union Association of Dakotas during an awards banquet last month.
Click to view larger image Kaylee Lapp, left, marketing specialist and training coordinator, Town & Country CU, Minot, N.D., and Robbie Thompson, president/CEO of the Credit Union Association of the Dakotas.         

Town and Country CU, Minot, N.D., earned three first-place awards. They include:
  • Building Connections Award;
  • Dora Maxwell Social Responsibility Award, $200 million to $500 million in assets; and
  • Desjardins Adult Financial Education Award, $150 million to $500 million in assets. 

Click to view larger image Stephen Vaughan, left, vice chair of Capital CU, Bismarck, N.D., and Robbie Thompson, president/CEO of the Credit Union Association of Dakotas.
Capital CU, Bismarck, N.D., collected two first-place awards, including:
  • Louise Herring Philosophy in Action Award, $250 million or more in assets; and
  • Desjardins Youth Financial Education Award, $150 million to $500 million in assets.    
Postal Family FCU of Fargo, N.D., also collected two first-place awards, including:
  • Louise Herring Philosophy in Action Award, less than $50 million in assets; and
  • Dora Maxwell Social Responsibility Award, $5 million to $20 million in assets.
Click to view larger image Karen Anderson, left, CEO of Postal Family FCU, Fargo, N.D., and Robbie Thompson, president/CEO of the Credit Union Association of the Dakotas (Photos provided by the Credit Union Association of the Dakotas)
The Building Connections Award recognizes the cooperative spirit and the theme of "people helping people" through involvement in National Cooperative Month and International Credit Union Day.
 
The Dora Maxwell Awards for Social Responsibility Award signifies a commitment to volunteering time, energy and resources to boost the living standards of others.
 
The Louise Herring Awards for Philosophy in Action Award display how credit unions put People Helping People credit union philosophy into action.

The Desjardins Financial Education Awards recognize the financial literacy efforts of credit unions in educating youth and adults.

Winners of Dora Maxwell, Louise Herring and Desjardins Financial Education state-level awards go to the national awards competition sponsored by the Credit Union National Association.                     

PCUA Offers Training On Lending To Marcellus Shale Small Businesses

 Permanent link
HARRISBURG, Pa. (7/18/13)--The Pennsylvania Credit Union Association is sponsoring a two-day extensive training course Aug. 5-6 on lending to small businesses that are a part of the Marcellus Shale supply chain.

Marcellus Shale refers to one of the largest natural gas fields in the world.

The Shale Gas Supply Chain: How to Lend to Small Businesses conference will meet at Canonsburg, Pa., and will feature shale industry leaders, who will discuss the operating cycle of a shale driller, the supply chain opportunities, as well as benefits and pitfalls, said PCUA (Life is a Highway July 16).

The opportunities stem from efforts by energy companies to tap three layers of gas-rich shale--Marcellus, Utica and Upper Devonian--that stack up hundreds of feet below the surface in the western part of the state, said PCUA. Workshop attendees also can tour a Marcellus Shale drilling site, for an additional fee.

The Marcellus Shale region stretches 95,000 square miles--from West Virginia through upper New York and is expected to generate 212,000 jobs.  A "fairway" of the fields cover 40,000 to 50,000 square miles through Pennsylvania (News Now Aug. 18, 2011). 

Credit unions are likely to see increased economic development as well as a mixed bag of opportunities and risk. One gas company has predicted that for every one of its employees, three or four employees of contractors also will work at each stage of developing the drilling wells.

As a result, credit unions in the region are expecting over the next two decades an influx of deposits from new jobs, mortgage loans with complex issues related to appraisals of property with wells and mineral rights, complex property leases, more complex tax income classifications and opportunities for small business loans.

FBI Offers Reward For Arrest Of Liquidated CU's CEO

 Permanent link
SOLON, Ohio (7/18/13)--The Federal Bureau of Investigation Wednesday offered a reward for information leading to the arrest and prosecution of the CEO of a Cleveland, Ohio-based credit union that was liquidated Monday.
 
Alex Spirikaitis,  CEO of the now-liquidated Taupa Lithuanian CU, is wanted on charges related to embezzlement.  He was believed to be holed up at his home in Solon, Ohio, after authorities arrived Tuesday night with an arrest warrant. However, they discovered Wednesday--after what they believed was  a 12-hour standoff  with Spirikaitis barricaded inside--that the home was empty (KAIT8.com  and WKYC.com July 17.
 
Authorities had tried to serve the warrant on charges of  false credit institution entries at 8 p.m. Tuesday.  Family members were present at the home but were asked to leave when it was thought Spirikaitis had barricaded himself inside. The FBI and police stayed at the home overnight and attempted to communicate with him using a loudspeaker.
 
The Ohio Division of Financial Institutions closed the $23.6 million asset credit union Monday after determining it had no prospect for restoring viable operations and appointed the National Credit Union Administration as liquidating agent  (News Now July 16).  Members' deposits are federally insured up to $250,000 by the National Credit Union Share Insurance Fund.
 
The 11th federally insured credit union liquidation this year, Taupa Lithuanian CU served 1,154 members. It was chartered in 1984 to serve the Lithuanian community of  Cleveland and Northeast Ohio.

CUs In Pa., Fla., Reporting Card Scams

 Permanent link
MADISON, Wis. (7/17/13)--Credit unions in Pennsylvania and Florida reported debit and credit card scams last week.
 
In Pennsylvania, roughly 100 members from Mercer County Community FCU and PennStar FCU, both of Hermitage, unwittingly provided their account numbers or debit card personal identification numbers to scammers Thursday.
 
Members received phone messages informing them that something was wrong with their accounts and asking for account numbers or personal identification numbers, Jerry Miller, Mercer County FCU director of lending, told The Herald (July 13). The message informed members if they didn't provide the information, their accounts would be shut down.
 
On Friday, both credit unions were inundated with calls from members who realized they had been scammed. It was unknown how scammers gained access to members' phone numbers.
 
In Florida, Keys FCU of Key West, reported as many as five debit or credit card thefts per day, instead of the usual one per week, reported The Key West Citizen (July 13).
 
Cards are most often compromised at local gas stations, said Scott Duszynski, Keys FCU president/CEO. The amounts withdrawn on the cards appear to be small and within the local area, he told the newspaper.
 
Duszynski advised victims to file police reports. Members should closely monitor their accounts, he said.
 
Once a card number has been stolen, it can be used in the same manner as the actual card, the Federal Trade Commission said.

NEW: Poll Finds CUs Favored Among Financially Savvy

 Permanent link
LOS ANGELES (7/17/13 UPDATED 10:30 a.m. CT)--Financially savvy consumers overwhelmingly choose credit unions as their preferred institutions, says a new GoBankingRates.com poll, and that is no surprise, says Paul Gentile, Credit Union National Association executive vice president of strategic communications and engagement.
 
"For users of financial services, it's all about trust--and the credit union model, as a cooperative operating on a not-for-profit basis with no shareholders--engenders the trust among consumers and small business customers," he told GoBankingRates.com (July 17).
 
Among those polled on the GoBankingRates.com site and its partner sites--US News, Boston.com, AL.com and The City Wire--more than 73.76% of poll respondents choose credit unions as their preferred institutions. Local community banks distantly followed, being preferred by 14.18%, with national banks preferred by 9.93%, and other institutions by 2.13%.
 
The publication also featured an explanation by Andrew Schrage, personal finance journalist and co-owner of blog Money Crashers Personal Finance, who noted he used to have an account at a national financial institution but pulled it when he ran into bad customer service.  Like 2.2 million other banking customers since 2011, he moved his money to a credit union.
 
Credit unions still have workd to do, however. A more general survey found that credit unions are still a long way to becoming the average person's primary financial institution, said GoBankingRates.com's poll of more general consumers.
 
That's all the more reason for credit unions to Unite for Good by providing service excellence, raising awareness about the benefits of credit unions and eliminating barriers--such as banks' attacks on credit unions' tax-exempt status and their attempts to limit credit unions' ability to offer member business loans, said CUNA.  This three-pronged campaign is working toward credit unions' shared strategic vision in which "Americans choose credit unions as their best financial partner."
 
Use the links to access the GoBankingRates.com article and learn more about the Unite for Good campaign.

CEO Of Phony CU Pleads Not Guilty In Virgin Islands

 Permanent link
ST. THOMAS, V.I. (7/17/13)--The former CEO of Her Majesty's CU, a bogus credit union that was doing business and soliciting investors in Colorado and in the Virgin Islands, pleaded not guilty to charges of obtaining money by false pretenses, conspiracy, embezzlement by fiduciaries, and violating the territory's anti-racketeering statute in a court in Virgin Islands.
 
The pleading by Stan McDuffie--also known as Stan Roberson, Stan Roberson-Battle, and Stanley B. Battle--was in absentia during an arraignment on March 21, according to the Virgin Islands Daily News (March 23). The case has been referred to Virgin Islands Superior Court Judge Adam Christian, said the article.
 
McDuffie, 46, was freed on $50,000 bond and let go after turning in his passport and signing an automatic waiver of extradition, according to the Denver Post (March 15).  The paper reported that the company's comptroller, John Williams, also was charged and was still at large.
 
The credit union is a subsidiary of Jilapuhn Inc. and did business both as Her Majesty's CU and as HMCU, even though it was not insured and it was not chartered by the Colorado Division of Financial Services or the National Credit Union Administration (News Now Nov. 13, 2012).
 
In 2011, NCUA issued a prohibition order against Roberson from future work at any federally insured financial institution (News Now June 3, 2011).
 
The Securities and Exchange Commission filed a legal complaint on Nov. 8, 2012,  against the company for offering fraudulent and unregistered "purported certificates of deposits" under the credit union's name. Its complaint said the McDuffie and HMCU used the HMCU website to "lure investors" by CDs with above-market rates. On Feb. 8, McDuffie denied the SEC the allegations and blamed regulators for failures.

Mobile Technology Demand Rises, World CU Leaders Told

 Permanent link
OTTAWA, Canada (7/17/13)--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.
 
Click to view larger image Successful mobile technologies increase convenience, consolidate activities and integrate with other aspects of consumers' daily lives, mobile technology expert Ian Shelley told a World Credit Union Conference general session audience Monday in Ottawa, Canada.
Shelley, who was the keynote speaker at Monday's general session, reinforced that the future of credit union services is mobile commerce. The conference, presented by the World Council of Credit Unions, ends today.
 
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.
 
Click to view larger image Credit unions succeed when they provide multiple channels of service for their members, World Council of Credit Unions President/CEO Brian Branch told Monday's general session audience at the World Credit Union Conference. (Photos provided by World Council of Credit Unions)
 
"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.

CUNA Receives Membership Growth Award At World Conference

 Permanent link

MADISON, Wis. (7/17/13)--The Credit Union National Association Monday was recognized with the World Council of Credit Unions' 2013 Outstanding Member Growth Award.
 

Click to view larger image The Credit Union National Association with the World Council of Credit Unions' 2013 Outstanding Member Growth Award at the World Credit Union Conference in Ottawa, Canada. (Photo provided by the World Council of Credit Unions)

The award was presented at the World Credit Union Conference in Ottawa, Canada. The conference is presented through today by the World Council.
 
CUNA was honored for achieving its highest membership growth numbers in decades. U.S. credit unions include 96 million members nationwide. The National Credit Union Administration released figures in May that claim the fastest first-quarter loan growth for federally insured credit unions in five years, as well as dramatic membership growth of more than 800,000 new members (News Now May 30).
 
Aided by Bank Transfer Day, Nov. 5, 2011, credit unions added nearly 2.2 million new members in the 12-month period ended June 30, 2012, a total that is almost double the 1.2 million average growth credit unions have seen in similar 12-month periods over the previous decade (News Now Nov. 2).
 
Globally, there are 56,000 credit unions in 101 countries, Bill Cheney, CUNA president/CEO, said in accepting the award.
 
Cheney also shared CUNA's Unite for Good Campaign with the global credit union community.
 
The Unite for Good initiative calls on credit unions to rally in support of a common vision where "Americans choose credit unions as their best financial partner." Achieving the vision requires working toward three key objectives: removing legislative and regulatory barriers that obstruct credit union progress; raising consumer awareness and understanding of credit unions; and fostering movement-wide service excellence.
 
Kenya Union of Savings & Credit Co-operatives (KUSSCCO) was also recognized as a recipient of the World Council's 2013 Outstanding Membership Growth award. KUSCCO received the award for relative membership growth during a period when many countries in the region were experiencing a slowdown in membership growth.
 
Confederacao Interestadual das Cooperativas Ligadas ao Sicredi (SICREDI) was named the 2013 Winner of the World Council of Credit Unions' Outstanding Assets Growth Award. SICREDI received the award for relative asset growth, which reflects quality of service and community commitment of SICREDI credit unions and an aggressive member responsive growth strategy.

CU Tech Spending Goes To Mobile, Online Banking

 Permanent link
MADISON, Wis. (7/17/13)--More than $2.06 trillion will be invested across software, hardware and information technology (IT)  services by businesses and governments this year, with the U.S. accounting for the most spending and software getting the most funds, said Forrester Research's annual IT spending study. For credit unions, tech spending will continue to focus on mobile and online banking technology to meet rising consumer demand and further engage members.
 
Credit unions budgeted on average nearly $125,000 toward online and mobile banking this year--a combined expense second only to core processing systems, according to the 2013-2014 CUNA Technology Spending Report, which surveyed credit unions with assets of $50 million or more.
 
That figure represents about one-fifth of credit unions' average IT budget of $642,797, which doesn't reflect employees' salary or benefits. That ratio holds true among even credit unions with assets of $500 million or more, which on average budgeted $2,055,287 for IT expenses for 2013, said the CUNA report.
 
About 60% of credit unions indicate that their budgeted IT expenditures for 2013 outpace their 2012 expenditures to some extent, with 17% budgeting double-digit increases.
 
Among the 24 IT areas examined in CUNA's report, credit unions clearly have earmarked the greatest levels of 2013 funding to supporting their core processing systems, at $185,000 on average.
 
Among emerging technologies, roughly 60% of credit unions intend to offer mobile/image deposit capture, mobile payments and wallets, and smart cards/EuroMasterCardVisa chip cards by 2015.
 
Credit unions also expressed strong interest in adding remote deposit capture, person-to-person payments, instant card issue, online account opening, secured email, member/customer relationship management and envelope-free acceptance of deposits.
 
Credit Union Magazine will publish more information on credit unions' technology spending plans for the rest of this year and 2014 in its October issue.
 
Globally, businesses and government will spend the largest share--$542 billion--on software, including middle ware, custom-built software, applications and operating systems, said Forrester's report.
 
IT outsourcing and hardware maintenance will account for $411 billion of their tech spending. That includes computer hardware support services, networks and other outsourcing, infrastructure outsourcing, hosting, application outsourcing, and application management.
 
Computer equipment spending will total $404 billion, with personal computers having the biggest share--$134.2 billion. But Forrester says that is a shrinking market and the biggest growth in 2013 will be in tablets, specifically the iPad.  Tablets will account for $21.1 billion of the equipment budget. Other expenses in this segment include servers, storage, peripherals and "other.
 
IT consulting and systems integration services will account for $389 billion of the tech spending, with strategy and other consulting services getting $156.4 billion and systems integration project work getting $232.8 billion.
 
Communications equipment will make up the fifth largest slide of IT spending, with $322 billion spent on telecommunications and enterprise and Server Message Block protocols.

NCUA Appeals Barclays, Credit Suisse Rulings

 Permanent link
ALEXANDRIA, Va. (7/17/13)--The National Credit Union Administration Monday filed a notice to appeal to the 10th Circuit Court of Appeals of a Kansas court's rulings in its lawsuits over residential mortgage-backed securities (RMBS) sold to corporate credit unions by Barclays Capital and Credit Suisse.
 
NCUA filed the notice with the U.S. District Court of Kansas, which on July 10 had dismissed  the Barclays case and dismissed 12 out of 20 claims against Credit Suisse.
 
That--coupled with a California court's granting NCUA an interlocutory appeal Friday of a similar case against Goldman Sachs--helps keep alive the battle of the agency to recoup millions of dollars in losses from the RMBS, which led to the liquidation of U.S. Central FCU in Kansas and the Western Corporate FCU in California.
 
The lower courts had dismissed federal claims related to whether NCUA had filed the lawsuits in time. In a number of similar lawsuits against brokers and underwriters, NCUA argued that an extender statute and a tolling agreement had lengthened the time allowed for it to file the lawsuits, but the California and Kansas courts had ruled the agency did not file certain claims in time.
 
NCUA has argued in the cases that the offering documents for the investments sold to the corporate credit unions "systematically abandoned" underwriting standards and misled the corporates into believing the investments were safer than they actually were.
 
The Tenth Circuit Court of Appeals in Kansas is also reviewing the time-barred issues in a separate suit filed against RBS Securities.

Virginia's 'QuitTheHit' Video Tops One Million Views

 Permanent link
LYNCHBURG, Va. (7/17/13)--More than 1.1 million consumers, mostly Virginians, learned more about credit unions and their benefits through a statewide awareness campaign--"QuitThe Hit"--created and funded by Virginia credit unions.

The "QuitTheHit" Social Media Campaign was launched in April to increase awareness and drive consumers to learn about the benefits of membership in Virginia-based credit unions. A humorous video was produced and shared through YouTube to reach those in Virginia ages 18 to 35. The video encouraged them to visit the campaign's informational website. Use the link to access the website and video.

"This was an unconventional and bold strategy for credit unions in Virginia, and we set the bar high expecting to reach at least one million consumers," said Rick Pillow, president of the Virginia Credit Union League. "We relied on consumer research and designed an edgy, humorous campaign leveraging the power of social media to help reach that goal. Thanks to our credit unions' commitment to promoting this campaign, we surpassed our goal and reached more than 1.1 million consumers."

More than 66,000 consumers visited the informational website, via the video, and more than 25,000 used the "search for a credit union" feature.

The league conducted consumer research to determine the strategy and message of the campaign. It learned consumers feel they are taking a "hit" from the economy and are suffering the impact of higher prices and rising fees. The creative team took the idea of feeling hit to a literal level and designed a video featuring a George Washington character, who represents money, physically taunting the main character who represents the consumer (News Now April 12).

Awareness of Virginia credit unions was already high at 78%, according the league. However, the campaign successfully reduced the "fog" of uncertainty surrounding credit union membership, with fewer consumers now saying credit unions are not a viable financial services option, said the league.

Post-campaign research and tracking revealed that percentage of consumers who have lower rates and fees as "top of mind" when they think of credit unions doubled--to 8% from 4%. Following the campaign, more consumers (61%, up from 56%) said they want to find out more information about credit unions and their benefits, according to independent research.

Virginia-based credit unions have a membership of more than 7.9 million, as of March 31. However, only an estimated three million of that number reside in Virginia. Many Virginia-based credit unions--especially those affiliated with the government and military--serve members nationwide, and in some cases, worldwide.

Global Women Discuss Advancement As Leaders

 Permanent link
Click to view larger image Sheryl WuDunn, New York Times bestselling author and Pulitzer Prize winner, discusses women's economic empowerment at the 2013 Global Women's Leadership Forum in Ottawa, Canada.
OTTAWA, Canada (7/17/13)--More than 110 women credit union leaders from 12 countries gathered to discuss the advancement of credit-union women leadership, during the 2013 Global Women's Leadership Forum, Sunday. The event was held in conjunction with World Council of Credit Unions' World Credit Union Conference in Ottawa, Canada.

Participants heard from keynote speaker Sheryl WuDunn, New York Times bestselling author of  Half the Sky: Turning Oppression into Opportunity for Women Worldwide and the first Asian-American Pulitzer Prize winner, about women's potential to impact global development.

WuDunn presented research from her book on the varying degrees of women's oppression worldwide. In addition to women's education and jobs, she said that microsavings can provide women with economic empowerment, which is a key to solving gender inequity worldwide.

Click to view larger image Sheryl WuDunn meets Brian Branch, World Council of Credit Unions president/CEO, at the 2013 Global Women's Leadership Network reception. WuDunn is a New York Times bestselling author and Pulitzer Prize winner.
"There's no silver bullet," WuDunn said. "We must try different strategies, and a lot of times what works is not always the sexiest."

WuDunn related her findings to the credit union movement during a panel discussion focused on the challenges women credit union leaders face. Teresa Freeborn, El Segundo, Calif.-based Xceed Financial FCU president/ CEO, moderated the discussion. It included Patrice Pratt, Vancity CU (Canada) director; Lucy Ito, California and Nevada Credit Union Leagues executive vice president and chief operating officer; Lisa Bonin, Servus CU (Canada) corporate procurement specialist; and Katie Smigiel, CU*Answers vice president of organizational development.

The network announced that it is partnering with Filene Research Institute this year to conduct a study that identifies obstacles to leadership that women face in the credit union industry worldwide.

Click to view larger image Nicole Bice, left, Global Women's Leadership Network manager, presents the 2013 Athena Award to Roxanne Ostrem, Ventura (Calif.) County CU director, on behalf of the Global network at Saturday's network reception in Ottawa, Canada. (Photos provided by the World Council of Credit Unions)
The panel discussed recent research on inequalities in executive positions held by women throughout credit union systems worldwide. A balance of men and women in top decision-making positions can accelerate an organization's economic success, their studies and personal experiences revealed. Panelists suggested Global Women's Leadership Network members could make a difference by raising awareness on the importance and benefits of women leadership at their own credit unions, especially among those in upper management.

"Women aren't the problem," WuDunn said. "They are the solution."

Prior to the forum, Roxanne Ostrem, Ventura (Calif.) County CU director, was honored with the network's 2013 Athena Award Saturday evening at the Network's reception. The annual award honors outstanding achievement in support of credit union development, particularly as it relates to credit union women's leadership development worldwide.

Ostrem has been a credit union advocate for more than 20 years and is a founding member of the Global Women's Leadership Network.

The conference ends today with World Council's annual awards ceremony and closing night reception at the Canadian Museum of Civilization.

Copy That Good Buddy: Use @CUNA To Reach CUNA 'Followers'

 Permanent link
MADISON, Wis. (7/17/13)--Are you feeling an urge to tweet and you want to make sure you reach the Credit Union National Association--or CUNA--and all its followers?  Starting immediately and going forward, the old Twitter handle @CUNAverse is being replaced with the shorter and clearer @CUNA.
 
To the uninitiated, a Twitter handle is analogous to the longstanding Citizens Band-radio "handles," that is a call-name that let's everyone know who you want to reach.  Only with a Twitter handle you're dealing with online communications instead of airwaves--and you only have 140 characters to communicate.
 
By using @CUNA, CUNA makes that its primary social media voice on Twitter.  The change is intended to increase CUNA's reach and communications with our wide variety of constituencies.
 
The change will not affect existing followers.

Belvoir Members Seek Help Through Sequestration

 Permanent link
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

 Permanent link
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.

Celebrate 'Miracle Jeans Day' Sept. 18

 Permanent link
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.

New Jersey CUs' 1Q Reflects Surge in Savings

 Permanent link
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.

NCUA Reviewing RMBS Court Decisions To Decide What's Next

 Permanent link
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.

Global CU Statistical Report Features 101 Nations

 Permanent link
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.

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

 Permanent link
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."

World CU Conference Welcomes 2,376 Attendees To Canada

 Permanent link
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.

Six Wash. CUs See Save To Win Results

 Permanent link
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

 Permanent link
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.

Special Report: CUs Innovate To Reach Out To Communities

 Permanent link
MADISON, Wis. (7/15/13)--Credit unions are innovative in reaching out to their communities and their members with the good they do. But they aren't the type to boast about it.  After all, the credit union difference is in their DNA, so what's the big deal?
 
It turns out to be a very big deal. The credit union difference is at the heart of credit unions' structure, their mission and philosophy, and their tax exemption. And raising awareness of the credit union difference is one of three central components of the Unite For Good campaign initiated by the Credit Union National Association and the state leagues to work toward the strategic vision in which "Americans choose credit unions as their best financial partner."
 
To that end, News Now today begins a new, occassional series of special reports outlining some of the more creative outreach efforts begun by credit unions. See related News Now story:  CU Adapts Mobile Banking To Serve Migrant Workers."

Staff asked the state leagues and associations what's new in community outreach efforts in their states. What success stories did they know about where a credit union made a huge difference in their community? Who in their state had tried a cutting-edge approach with particularly outstanding results?

In the first week after News Now's request, leagues in 16 states submitted names of more than 40 credit unions that fit that bill. Some provided contact information and brief descriptions of what makes their credit unions special. In addition, several leagues suggested News Now check out the winners of their state-level Louise Herring Philosophy in Action Award,  Dora Maxwell Social Responsibility Award  and the Desjardins Youth Financial Education and Adult Financial Education Awards. Any of these, they said, would be good candidates for the outreach series.

Several leagues, such as the Credit Union Association of the Dakotas, mentioned they too are collecting social good stories of their own, as is CUNA's Unite for Good website. The Northwest Credit Union Association produced a 38-page report about Oregon credit unions doing wonderful work and said its Washington state report was due the following week.

Many responses told of student-run credit unions, financial education efforts such as Reality Fairs for youth or young adults, efforts to serve the Hispanic community, and initiatives to woo young adults with new mobile banking services. Others have special savings programs with interesting twists--such as a round-up savings program--or offer financial education to blind or visually handicapped students, or provide invest-local certificates. Many help fund community resource centers or offer scholarships to reward students for voluntarism. All the efforts mentioned provide value to the member but also to the community at large.

Today's article features Ventura County CU in Ventura, Calif., discussing how it attracted 210 migrant workers and helped them save a combined total of at least $65,000. (See: CU Adapts Mobile Banking To Serve Migrant Workers.)

Credit unions that have interesting stories of their own programs can send their information to News Now at newsnow@cuna.coop  or post them on the Unite For Good website. Use the links.

World CU Conference Kicks Off In Ottawa

 Permanent link
OTTAWA (7/15/13)--The 2013 World Credit Union Conference, presented by the World Council of Credit Unions, kicked off Sunday in Ottawa, Canada, with the opening ceremony and international flag parade.
 
More than 2,000 attendees were expected at the Ottawa Convention Center for the event, which ends Wednesday.
 
General Session keynote speakers this week include:
  • Today:  Ian Shelley, information technology and mobile payments expert and former partner at KPMG, who will discuss the future of mobile banking technology. Shelley has 20 years' experience with credit unions, banks, insurance agencies and regulators in Australia, Bermuda, Canada and the United Kingdom.
  • Tuesday: Charlene Li, New York Times best-selling author of Groundswell and Open Leadership, and social media and technologies expert, who will discuss social media and the financial sector.  The founder of the Altimeter Group, Li was named one of the 100 most creative people in business by Fast Company when she served as former vice president and principal analyst at Forrester Research.
  • Wednesday: Simon Sinek, corporate leadership strategist and author of Start With Why: How Great Leaders Inspire Everyone To Take Action, who will speak about corporate leadership strategy. Sinek is known for his theory of the "Golden Circle," a natural pattern grounded in the biology of human decision-making that explains why some people and organizations are more inspiring than others.
Preceding the opening ceremony, the Global Women's Leadership Forum met and heard speaker Sheryl WuDunn, Pulitzer Prize winner and co-author, along with her husband New York Times columnist Nick Kristoff,  of  Half the Sky: Turning Oppression into Opportunity for Women Worldwide.

The conference includes more than 30 breakout sessions with leaders from around the world in five educational tracks:  leadership and strategy, technology, international credit union experience, advocacy and governmental affairs, and innovative solutions.
 
News Now will provide coverage of the event, which ends Wednesday. To keep up with the conference on Twitter, use the hashtag #WCUC2013 or the handle @woccu.

CU Adapts Mobile Banking To Serve Migrant Workers

 Permanent link
VENTURA, Calif. (7/15/13)--Ventura County CU in Ventura, Calif., began taking mobile banking devices out in the field two years ago to help migrant workers fulfill their financial needs. However, when it became evident in the first year of the program that it wasn't working, the credit union decided to move to use debit cards, ATMs and online banking to better meet the workers' needs.
 
Ventura County--about 60 miles north of Los Angeles--has 840,000 residents--including 40,000 agricultural workers. Most don't have a formal relationship with a credit union or bank, Joe Schroeder, president/CEO of Ventura County CU, told News Now
 
"I got here four years ago, and went out into the field and saw how hard the workers were working and knew they were being exploited by payday loan people and check cashers," Schroeder said. "So I went to our board ... and the board got behind the program. I felt the outreach to commit to agricultural workers in the county was important."
 
The $628 million asset credit union partnered with the World Council of Credit Unions after seeing a presentation of what World Council did in rural Mexico with mobile banking devices.
 
"The idea was that we would take mobile devices out into the field and open accounts in the field," Schroeder said. "We started out with mobile devices and a change-the-world 'Walt Disney' mentality. However, it didn't work that way."
 
Migrants don't always know when they are scheduled to work, and when they do, it is hard to get to them. Often there is no reception for electronic devices where they work, Schroeder explained. Many times workers are paid on how much they pick, and they work hard from dawn to dusk without a lot of time for banking in the field.
 
So the credit union moved away from mobile devices and migrated to debit cards, ATMs and some online banking for workers at two farms: the Boskovich Farm and the Ball Horticultural Co. farm.  In the past two years, the credit union has signed up 210 members at the two farms. None had previous financial relationships. "It was a dream, and we had to adapt the dream to reality--which is what you need to do," Schroeder said.
 
"We go to the farms where there is manufacturing and processing going on--not in the fields," Schroeder explained. "We go weekly and train the workers to use debit cards, ATMs and some online banking. Most of them want cash in their pockets or in their hands, so to get them to move to debit cards and ATMs is a big deal." 
 
"The credit union also is attempting to encourage the workers to save more," Natalie Bradley, Ventura County CU community development manager, told News Now. So far, of the 210 workers in the program, one has saved $11,000, seven saved $5,000 each, three saved $4,000 apiece, and seven each have saved $2,000 and $1,000, respectively.
 
"We've impacted these members for the rest of their lives by giving them a chance to be a financial partner in the community," Schroeder said. "We are working with them to get IDs, save money, and send money back to Mexico. So we help them avoid the abuses of check cashers and payday lenders."   
 
One hurdle the credit union must overcome every day is trust. "They don't trust financial institutions because of the abuse from check cashers and mobile check cashers," Bradley said. 
 
"You have to have the right people out there who understand what migrant workers' sensibilities are and what they are going through--someone whom they can relate to and trust," Schroeder said.
 
The program is not profitable. The credit union has invested roughly $100,000 in it since its inception, including hiring one additional staff person, he added. 
 
"We've made a commitment that is not insignificant," Schroeder said. "We're still refining it and still trying to keep adapting. Our mission is the same: We need to help people in the community and we will keep helping them."
 
Ninety percent of the workers at the Boskovich Farm facility are members of credit unions. "We need to make the investment and commitment--and then trust will come. We are in it for the long haul," Schroeder concluded.
 
[Editor's Note: This is the first of a series of special reports about credit unions' outreach efforts. See related News Now story, Special Report: CUs Innovate To Reach Out To Communities.] Awareness is one of the tenets of the Credit Union National Association's and the state credit union leagues' Unite for Good campaign toward "Americans choosing credit unions as their best financial partner."

Annual Report Highlights NCUF Activities For 2012-2013

 Permanent link
MADISON, Wis. (7/15/13)--The National Credit Union Foundation has released its 2012-2013 Annual Report with the theme "Helping Credit Unions Making the Difference."
 
Click to view larger image Click for larger view
The report highlights NCUF activities related to programs and grants during the past 12 months.
 
Among the programs the report highlights is NCUF's REAL Solutions initiative, which partners with state credit union leagues to help credit unions build member and consumer financial capability. REAL Solutions has worked with 12 states during the past three years and helped 801 credit union professionals become certified financial counselors. By the end of the 2013, that number will grow to 16 states with an additional 350 to 400 counselors.
 
In 2012, NCUF funded 19 new grants for $287,387. During the past year, NCUF also refocused the annual grant process moving from a variety of smaller grants to more-focused, larger grants for a bigger impact, the report said.
 
NCUF also sponsors the Credit Union Development Educator (CUDE) program. Two DE Training classes were held in 2012 and this year, 40 new CUDEs joined the ranks after attending the Spring 2013 DE Training in Madison, Wis. A second training will be held in September. Since the DE Program started, more than 1,000 credit union advocates from more 30 countries have graduated from DE Training.
 
NCUF reported assets of $6.1 million for 2013.
 
To download the report, use the link.

World Council To Explore Haitian Utility Mobile Payments

 Permanent link
MADISON, Wis. (7/15/13)--The World Council of Credit Unions will be researching the feasibility of mobile bill payments for Haitian utility customers, after the U.S. Agency for International Development (USAID) in Haiti said it will fund the formation of Haiti's first electric utility to provide 24/7 power.

Click to view larger image The use of mobile money is growing in Haiti. Yvrose Joseph (pictured above), World Council director of financial products and services in Haiti, reads Digicel's TchoTcho Mobile instructions for its mobile wallet services at a recent event. World Council also is exploring mobile utility payments in northeastern Haiti and is working with the country's credit unions to implement the Boom mobile banking product. (Photo provided by the World Council of Credit Unions)
USAID's $24 million, three-year Pilot Project for Sustainable Electricity Distribution (PPSELD) program will provide electricity to at least 5,000 customers in northeastern Haiti. NRECA International Ltd. is managing the program, which involves World Council, ESD Engineering S.R.L. and The Cadmus Group Inc. as partners.

"The selection of World Council as part of the PPSELD program offers an exciting step forward in Haiti's mobile payment environment," said Brian Branch, World Council president/CEO. "Involving a financial service organization with ties to the country's locally owned caisses populaires [credit unions] demonstrates Haiti's commitment to developing true, homegrown mobile banking services for its people."

World Council will examine the preferences and availability of traditional financial services and mobile money options among current and potential customers in Caracol, Terrier Rouge, Trou du Nord and Limonade.

World Council has managed the Haiti Mobile Money Initiative (HMMI), funded by USAID and the Bill & Melinda Gates Foundation, since it began in 2010, six months after the country's devastating earthquake. HMMI is a $10 million incentive fund to jumpstart financial services via cellphones in Haiti and to expedite the delivery of cash assistance from humanitarian agencies to earthquake victims.

Digicel's TchoTcho Mobile, which received the HMMI's "first-to-market" award last year, gives people the ability to load, transfer and receive stored cellphone value and pay for goods using their cellphones. With substantial technical assistance from HMMI, Digicel's TchoTcho Mobile recently migrated its technology to a high-capacity platform and broadened its agent network to better support mobile money expansion in Haiti. The new platform includes a mobile bill payment system among other customized services.

In June, World Council provided software and technical assistance to the Le Levier Federation of credit unions to launch the Boom mobile banking product. It is the first mobile product in Haiti to connect user transactions to credit union current accounts rather than use stored cellphone value. Offered by more than 60 credit union locations nationwide, Boom provides Haitians the ability to register, deposit and transfer funds to registered and unregistered users for free and to make low-cost cash withdrawals within seconds via their cellphones.

Boom also allows Haitians to store and transfer larger amounts of funds than is otherwise available via mobile wallet solutions.

The Le Levier Federation is composed of 20 federated credit unions and 27 client credit unions collectively comprising 70 locations in all 10 departments of Haiti. Le Levier's affiliated credit unions serve more than 360,000 families nationwide.

CU System Briefs (07/15/2013)

 Permanent link
  • PITTSFIELD, Mass. (7/15/13)--A woman was sentenced to three years in prison for stealing $200,000 from a branch of Greylock FCU based in Pittsfield, Mass. After pleading guilty to charges of making false entries into corporate books and larceny of more than $250, Janine Shepard was sentenced Wednesday in Berkshire (Mass.) Superior Court. Shepard allegedly stole the money between Jan. 1, 2010, and Feb. 18, 2102, while she was a head teller at the $1.13 billion asset credit union, prosecutors said (The Sun Chronicle July 11) ...

NEW: Court Dismisses NCUA's Federal Claims In Goldman Sachs, Grants Appeal

 Permanent link
LOS ANGELES (7/15/13 UPDATED 12:30 p.m. CT)--A federal judge in Los Angeles Friday ruled that National Credit Union Administration waited too long before filing some of its claims in a lawsuit against Goldman Sachs over $491 million in losses from residential mortgage-backed securities sold to U.S. Central FCU and Western Corporate FCU.
 
However, 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.
 
"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," said Wu.
 
It was the second decision in a week that dismissed NCUA's claims against brokerage firms that sold or underwrote  residential mortgage-backed securities (RMBS) that caused the collapse of several corporates, including U.S. Central and WesCorp. A U.S. District Court in Kansas last week dismissed the agency's suit vs. Barclays Capital and reaffirmed the dismissal of 12 of 20 claims against Credit Suisse, saying the claims were time-barred and that NCUA had not filed the case in time. (See related story in News Now, Court Dismisses NCUA Lawsuit Over Corporate CU Losses Vs. Barclays).
 
In the Goldman Sachs suit, the agency claimed 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.

NEW: World CU Conference Opens With Canadian Fanfare

 Permanent link
OTTAWA, Canada (7/15/13 UPDATED 11:45 am. CT)--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.

Through Wednesday, participants will network and learn from top 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, recognizing the importance of the audience's international cooperative efforts.

"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."

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 2013 World Credit Union Conference concludes Wednesday with a closing reception at the Canadian Museum of Civilization.

CU System Briefs (07/12/2013)

 Permanent link
  • SAN DIEGO (7/1213)--A man jumped up on the counter and fired a shot during a robbery of the El Cajon branch of San Diego-based California Coast CU Tuesday. No one was injured (U-T San Diego First Edition July 10 and abc10news.com July 10). The incident occurred at about 5 p.m., when the man entered, jumped up on the counter and shouted at employees to give him money. He pointed what appeared to be a semi-automatic pistol at employees and repeatedly threatened them, discharging the weapon once, said the Federal Bureau of Investigation. The tellers complied and he placed the money into a bag he was carrying and left, getting into a dark-green sports utility vehicle driven by a second person. He wore  a dark cap and sunglasses, had dark hair and had tattoos on his right cheek, said the FBI ...
  • PORTSMOUTH, N.H. (7/1213)--The new Portsmouth, N.H., corporate headquarters of Service CU has been certified by the U.S. Green Building Council as Leadership in Energy and Environmental Design (LEED) Gold.  The four-story building  uses 36% less energy, consumes  40% less water, emits 63% less carbon dioxide, and achieved a 98 Energy Star Rating, meaning it uses 98% less energy than a typical non-environmentally building of equal square footage. Some of its green elements include: a light-colored roof to reflect sunlight and produce heat gain; geothermal heating and cooling; solar hot-water heating; and reduced water use. It has a brownfield redevelopment site, bike racks, fuel efficiency and carpool parking spaces.  "Our goal from the beginning was to use American materials and labor in constructing our new environmentally sound Service CU corporate offices," said President/CEO Gordon A. Simmons ...
  • KENTWOOD, Mich. (7/1213)--Community West CU, a $118 million asset credit union in Kentwood, Mich., will be giving away money to young adults during a six-week $20K Cash Giveaway promotion this summer. As part of the registration process for the promotion, participants must watch a short video of local DJ Eric O'Brien talking about a financial topic. The video topics include avoiding ATM fees, dodging the downfall of payday loans and finding free checking accounts that pay interest. "We hope the young adults will take something away from the videos as we continue to look for ways to financially educate the next generation," said Marketing Director Jillian Gajtka. The giveway will include 40 prizes of $500 each. To encourage membership growth, most of the prizes will be given away to current and new members who are 18- to 24-years old and who register for the promotion.  To help new members get on the right track, Community West will pay their initial $5 membership deposit ...

Debit Card Issuers Report Strong Performance In Key Areas

 Permanent link
HOUSTON (7/12/13)--Debit card users performed more transactions and spent more per card during 2012, leading to a strong performance for debit card issuers in key areas, said PULSE's 2013 Debit Issuer Study, released Wednesday.
 
The average active cardholder performed 19.4 debit transactions per month in 2012, up from 18.3 transactions in 2011, said the study. As a result, the total annual amount spent per active consumer debit card rose to $8,753 from $8,326.
 
Penetration and active rates both improved year-over-year. Penetration increased to 77% in 2012 from 76% in 2011. Active rates rose to 68% from 66%, said the study, which was conducted by Oliver Wyman. It surveyed 64 large banks, credit unions and community banks.
 
Issuers also reported a decline in debit card fraud. Net fraud losses dropped 30% for both signature and PIN  debit. Signature fraud losses were $0.02 per transaction, compared with $0.031 cents in 2011.  PIN debit remained eight times more secure than signature debit, with fraud loss rates dropping to $0.003 from $0.004 per transaction, PULSE said.
 
Beyond the core debit business, issuers reported mixed outlooks on prepaid cards, chip-based Euro MasterCard Visa (EMV) cards and mobile payments.
 
Roughly 84% of issuers surveyed offer a prepaid card, with 73% offering gift cards. Because of low sales, issuers expressed indifference toward this product, said PULSE. By contrast, sales of general purpose reloadable (GPR) prepaid cards more than doubled in 2012-- to 36% from 19% in 2011.
 
Some positioned their GPR cards as supplemental accounts for existing account holders, while others targeted the cards to consumers outside mainstream banking.  Financial institutions projected a 55% year-over-year growth for their GPR cards in 2013. That compares with a projected 2% decline in prepaid gift card sales.
 
As for the EMV standard, 95% said they are aware of payment networks' plans to shift in 2015 the liability for disputed transactions. Roughly 38% planned to issue chip-based debit cards in 2014; another 8% planned to do so in 2015. However, many were unsure how to support EMV while adhering to merchant routing choice obligations. "In this environment, more than half the issuers reported that their plan is to wait to see if the industry converges around a common solution," PULSE said.
 
More issuers were testing mobile solutions: 13% are participating in a mobile payments pilot, up from 9% in 2012. Large banks are the most active, with 26% testing a solution, up from 15% last year.
 
Many participants viewed the shift from card to mobile payments as inevitable with 93% expecting more than 5% of debit transactions to migrate to mobile in the next five years. However, they also cited a need for a compelling solution that goes beyond the novelty factor of paying with a phone to drive meaningful uptake.
 
News Now reported Thursday that the study also found that interchange revenue caps have impacted all issuers, whether "regulated" or "exempt" from the cap. Use the link to see the story, Debit Study: Interchange Rule Affected Regulated, Exempt Issuers.

'Mortgages Are Memberlicious' Blog Touts CU Home Financing

 Permanent link
FAIRBORN, Ohio (7/12/13)--A new blog, "Mortgages are Memberlicious," discusses how credit unions can become more meaningful to their members through home financing.

"I believe credit unions are the best source for Americans to get a home loan," said Tim Mislansky, who established the blog. "Unfortunately, only about 7% of Americans seem to agree with me. But I am out to change that."

Mislansky is president of myCUmortgage and senior vice president and chief lending officer at Fairborn, Ohio-based Wright-Patt CU. The blog represents his thoughts and observations and is meant to inspire credit unions to become more active in real estate lending, he said.

With more than 20 years' experience with credit unions and their members, Mislansky has served on Fannie Mae's Credit Union Advisory Council Board, the Prime Alliance Advisory Board, and the Ohio Credit Union Foundation Board.

He currently serves on the Mortgage Cadence Advisory Board and on the boards of American Credit Union Mortgage Association and CU Realty Inc.  He also has participated in the Filene Research Institute's innovation group, i3.

By writing the blog, he hopes "to cause credit union leaders to re-think what their credit union is, or isn't, doing to help their members with mortgages."

Filene Report Helps CUs Nudge Members From Intent To Action

 Permanent link
MADISON, Wis. (7/12/13)--Credit unions can build gentle "nudges" into products and services that don't limit their members' options but place higher value on better choices, according to a new report from the Filene Research Institute.
 
A nudge is any aspect of the decision process that alters people's behavior in a predictable way without forbidding any options or significantly changing their economic consequences, said the report, "A Practitioner's Guide to Nudging."
 
Increasing participation in retirement savings plans is a common topic in behavioral economics. As an example, the report outlines the work of a team of Dartmouth College researchers who worked with a not-for-profit institution to help increase participation in its supplementary pension program. After conducting interviews, surveys and focus groups, the team found potential savers struggling with three barriers, including:
  • A lack of knowledge and information about where to start saving;
  • A belief that they did not have enough money to start saving; and
  • A lack of financial self-control.
The research team believed that one of the major reasons individuals do not reach their savings goals is a lack of planning. Coupling this insight with the barriers identified, the team designed a planning aid to reduce the complexity of opening an account and contributing to the pension program. The aid simplified the steps so that the process took no more than 30 minutes.
 
The planning aid highlighted a range of contribution amounts, from as little as $16 per month to a maximum of $1,666.67 per month, suggesting that it does not take much money to open an account and contributed to a pension program. The planning aid doubled enrollment within 60 days of implementation.
 
The report offers additional case studies and outlines the process for nudging members and customers.
 
To download the report, use the link.

NCUA 'Respectfully Disagrees' With, Reviewing Barclays Ruling

 Permanent link
ALEXANDRIA, Va. (7/12/13)--The National Credit Union Administration did not comment Thursday on whether it will appeal the decisions by a federal judge in Kansas dismissing its claims for losses from the sale of residential mortgage backed securities to U. S. Central FCU and Western Corporate FCU by Barclays Capital and Credit Suisse. However, it said it is reviewing the decisions.
 
"We respectfully disagree with the rulings, and we are reviewing them," said NCUA spokesman John Fairchild, public affairs specialist. "We will continue to vigorously pursue our claims against the parties that sold the faulty securities to the corporate credit unions."
 
The suits, part of eight suits filed in U.S. District Court in Wichita, Kan., as well as suits against brokers in other districts, were filed by NCUA acting as the corporates' liquidating agent and were an attempt to recoup losses from the RMBs that contributed to the corporates' conservatorship and liquidation in 2009.
 
In the rulings Wednesday, U.S. District Judge John W. Lungstrum said NCUA'a claims were time-barred, which meant NCUA did not file the lawsuits against the brokerage firms in time.  NCUA had argued that it had met the statute of limitations for filing the lawsuits because it had entered into a tolling agreement that delayed the filing deadlines and that it had an extended time to file under an "extended statute."
 
Lungstrum said that NCUA was required to file the claims by March 20, 2012, three years after it was appointed conservator of U.S. Central and WesCorp, but that NCUA did not initiate the suit until Sept. 25, 2012.
 
The case has implications for other lawsuits filed by NCUA against brokerage firms that sold RMBS certificates to various corporate credit unions and that use the same arguments relying on tolling agreements and extender statutes. It also has implications for lawsuits filed by other agencies such as the Federal Deposit Insurance Corp., which had submitted an amicus brief supporting NCUA's arguments in the Credit Suisse case. The judge rejected FDIC's arguments as well as NCUA's.
 
See related story:  Court Dismisses NCUA Lawsuit Over Corporate CU Losses Vs. Barclays in Thursday's News Now by using the link.

Ohio's Final Budget Minimizes Impact On CUs

 Permanent link
COLUMBUS, Ohio (7/12/13)--The $62 billion Ohio state budget was signed into law without a huge expansion of the sales tax base--owing to the work of the Ohio Credit Union League and credit union peers on the State Budget Impact Work Group, said the league.
 
While credit unions came out of the budget process relatively untouched, the final version did include a 0.25% sales tax increase, to 5.75% from 5.5%, meaning state-chartered credit unions will pay a little more on taxable goods and services, the league said (eLumination Newsletter July 10).
 
Also, credit union service organizations currently subject to the Commercial Activity Tax will likely see an increase because that tax was changed to an incremental-scale based on gross receipts, the league said.
 
The league also noted that Gov. John Kasich remains steadfast in finding a legislative avenue to expand Medicaid. Several bills addressing this effort have been introduced, and any expansion of a state program likely means additional changes to tax policy in order to generate funding, the league added, saying it will remain watchful.

League Working Toward Public Funds Bill In Ohio

 Permanent link
COLUMBUS, Ohio (7/12/13)--The Ohio Credit Union League has worked with State Rep. Lou Terhar (R-Cincinnati) and House Minority Leader Tracy Maxwell Heard (D-Columbus) to introduce state legislation that would permit credit unions as eligible depositories for public funds (House Bill 221).
 
Under the bill--which is important to many Ohio credit unions, the league said--credit unions also would be eligible to participate in programs and initiatives offered through the state and local governments, including GrowNow, SaveNow, and the Small Business Collateral Enhancement Program (e-Lumination Newsletter July 10).
 
There currently are 15 co-sponsors--eight Republicans and seven Democrats--in addition to the two joint sponsors. The bill has been referred to the House State & Local Government Committee, said the league.
 
The league is again working with county commissioners and township trustees, who supported a previous bill, to convey the need and validity of the legislation.
 
Several other states allow credit unions to accept public deposits or have considered or are considering legislation. They include California, Illinois, Missouri, New Jersey, New York, Oregon and Washington.

Young Entrepreneur Gets Start With CU Biz Account

 Permanent link
LIVONIA, Mich. (7/12/13)--"If you don't have a good reason to start a business, you won't succeed." That's the advice of Sasha Popkov, an eighth-grade student who opened a business checking account for her duct tape crafts business at Co-op Services CU in Livonia, Mich.
 
Click to view larger image Eighth grader Sasha Popkov shows off duct tape crafts from her business, "Crafts 4 the Cure." Co-op Services CU in Livonia, Mich., was the only financial institution that would let her open a business checking account for her business. (Photo provided by the Michigan Credit Union League).
Popkov, an eighth-grader at Livonia's Clarenceville Middle School, is a supervisor in the school's student credit union, which is sponsored by the $401 million asset Co-op Services CU (Michigan Monitor July 8).
 
Co-op Services was the only financial institution that would let her open a business checking account for her company, "Crafts 4 the Cure," reported the Michigan Credit Union League.
 
Popkov opened the business after her mother was diagnosed with breast cancer more than three years ago. Her business makes and sells duct tape wallets, purses, flowers, glasses cases, I.D. holders and more. She runs the business but has recruited her mom, grandmother and two brothers for production operations. All proceeds from her business are donated to the American Cancer Society.
 
Popkov stressed that running a business is not easy and it takes effort and dedication. "It's fun and cool--a lot of people my age don't think about this," she said, adding that volunteering at the credit union helped her sort out her money better and become more organized.
 
"It's very rewarding to watch someone like Sasha use her amazing drive and volunteer experience at our student credit union to start a business as such a young age," Jeremy Cybulski, Co-op Services' youth and community development coordinator, told the league.
 
Popkov plans to continue her business "forever" or perhaps until she achieves her next goal of becoming an attorney.

Citizens Community Nabs Four CUAD Awards

 Permanent link
BISMARCK, N.D. (7/12/13)--Citizens Community CU of Devils Lake, N.D., collected four first-place awards at the annual Credit Union Association of the Dakotas Summit June 7 in Devils Lake, N.D.
 
Click to view larger image Darwin Brokke, left, president/CEO of Citizens Community CU, Devils Lake, N.D., accepts a community services award from Robbie Thompson, president/CEO of the Credit Union Association of the Dakotas (CUAD). The credit union was recognized with four awards at the annual CUAD Summit. (Photo provided by CUAD)
Citizens Community CU captured first-place state-level awards in these categories:
  • Dora Maxwell Social Responsibility Award, $100 million to $200 million in assets;
  • Louise Herring Philosophy in Action Award, $50 million to 250 million in assets;
  • Desjardins Youth Financial Education Award, $50 million to $150 million in assets; and
  • Desjardins Adult Financial Education Award, $50 million to $150 million in assets.
The awards recognize the credit union's efforts in the areas of community involvement and financial literacy.
 
The Dora Maxwell Awards for Social Responsibility Award signifies a commitment to volunteering time, energy and resources to boost the living standards of others.
 
The Louise Herring Awards for Philosophy in Action Award display how credit unions put People Helping People credit union philosophy into action.
 
The Desjardins Financial Education Awards recognize the financial literacy efforts of credit unions in educating youth and adults.
 
Winners of these state-level awards go to the national awards competition sponsored by the Credit Union National Association.

Debit Study: Interchange Rule Affected Regulated, Exempt Issuers

 Permanent link
HOUSTON (7/11/13)--Debit-card issuing financial institutions experienced continued growth in their debit business, but both regulated and exempt issuers saw decreases in their interchange revenues since regulations enforcing the Dodd-Frank Act capped that revenue, according to the 2013 Debit Issuer Study commissioned by PULSE.
 
The cap on interchange rates reduced the debit interchange revenue for issuers with at least $10 billion in assets--the "regulated issuers." The average rates declined by 59% for signature debit transactions--to 23 cents from 52 cents on average--and by 32% for PIN debit transactions--to 23 cents from 32 cents--since the regulations went into effect, the study found.
 
Although "exempt issuers" with less than $10 billion in assets--which includes most card-issuing credit unions--are not directly subject to the interchange cap, they, too, have seen average interchange rates decline. Exempt issuers in the study cited competitive dynamics as a cause of the two-cent decrease in their average rates for both signature and PIN debits, said PULSE's report.  What's more, one in three exempt issuers in the study said they expect further declines in debit interchange.
 
The findings support the position of the Credit Union National Association, which has said that although credit unions and other financial institutions are not subject to the regulation, they would be impacted by the interchange-fee limit. If the total fee were reduced by $1.2 billion--a number that was central to a settlement Visa and MasterCard negotiated in an antitrust lawsuit--credit unions with card programs would lose about $50 million in total revenues--or 0.5 basis points of their total assets, CUNA said (News Now Nov. 12).
 
The interchange revenue allows credit unions to provide cost-effective, essential card services to their members. Any reduction in revenue credit unions experience essentially will not find its way to consumers' pockets but is more likely to end up in merchants' cash registers, CUNA said (News Now Nov. 12).
 
Other findings of the study indicated that both regulated and exempt issuers are making fundamental changes to their debit businesses in response to the debit interchange revenue reduction.  Among the most common actions are:
  • Reducing debit operating costs to better align costs with debit's new revenue proposition;
  • Reducing fraud to support the cost-containment goal and to qualify for the fraud prevention payment outlined in Regulation II;
  • Adjusting their overall demand deposit account product structures to either grow the financial institution's wallet share with a particular type of account holder or direct account holders to accounts that generate more revenue or have lower service costs; and
  • Restructuring or eliminating traditional issuer-funded debit rewards programs--40% of the regulated issuers terminated or restructured their programs in 2012).
As for growth, issuers experienced a 14% increase in PIN transactions and a 6% jump in signature transactions. When asked about their outlook for 2013, issuers were more cautious: they projected smaller growth levels this year, with PIN volume forecast to increase by 8% and signature transactions by 4%.

Tony Hayes, a partner at Oliver Wyman and co-leader of the study, noted that this is the lowest growth projection for signature debit seen since the study began.

CU System Briefs (07/11/2013)

 Permanent link
  • FARMERS BRANCH, Texas (7/11/13)--Cornerstone Credit Union League--the new league that combined the Arkansas, Oklahoma and Texas leagues--will be conducting meetings in Arkansas and Oklahoma to discuss the benefits and services the league will provide, according to the Leaguer (July 10). Credit unions will meet July 29 in Oklahoma City, July 30 in Tulsa, Okla., Aug. 7 in Little Rock, Ark., and Aug. 8 in Fort Smith, Ark. ...
  • WYOMING, Pa. (7/11/13)--The former CEO of United Food And Commercial Workers Local 1776 FCU has filed an appeal to her conviction on charges that she generated four checks totaling $1,342 from credit union business accounts to pay dental bills for her husband (The Times Herald July 10). In papers filed in Montgomery County Court, Anne L. Clyburn maintained that there was insufficient evidence to support Judge William R. Carpenter's ruling on misdemeanor charges of theft and tampering with records and felony charges of unlawful use of a computer in connection with incidents that allegedly occurred in 2004. Clyburn previously served nearly a year in state prison for an earlier conviction related to the same charges. Under Carpenter's ruling, Clyburn was given credit for time served ...
  • SAN ANTONIO (7/11/13)--Generations FCU in San Antonio has partnered with the George Gervin Youth Center in a student summer jobs program. The Gervin Summer Learning Program provides more than 70 San Antonio-area high school students with summer jobs, where they learn career development skills and general workplace etiquette. GFCU provides the students with financial education. The classes teach students to save the money they worked hard to earn. This is the second year that GFCU has partnered with the Gervin Center.  At the outset of the summer, students are provided a GFCU checking account and savings account. Their paychecks are direct deposited into their accounts with 80% going into a checking account and 20% going into a savings account. Gervin students who participate in the program also receive a Gervin Youth Center Debit Card that features famed San Antonio Spurs Shooting Guard, George Gervin (Leaguer July 10) ...

CUNA, Coopera Celebrate Four Years Of Alliance

 Permanent link
DES MOINES, Iowa (7/11/13)--Coopera and the Credit Union National Association are celebrating four years of a strategic growth alliance to help credit unions expand their Hispanic market outreach efforts.

Since the alliance formed in 2009, both organizations have leveraged each other's strengths--Coopera's Hispanic market expertise and CUNA's extensive resources--to help America's credit unions grow membership opportunities by reaching and serving Hispanics. Coopera is a full-service Hispanic market solutions company with specific focus on credit unions nationwide.

"By working together, Coopera and CUNA have truly been able to positively influence the growth and direction of the credit union industry," said Miriam De Dios, Coopera CEO. "As a testament to this, our organizations have been able to reach more than 200 credit unions with our collective resources, and in turn, those credit unions have been able to serve thousands of Hispanic members with our help. These results prove how instrumental this alliance has been to those credit unions we have served to date."

Through the strategic alliance, Coopera and CUNA launched specialized resources and programs, including:
  • El Poder es Tuyo, a member-facing, Spanish-language website designed to improve financial literacy;
  • On-demand training courses;
  • Spanish seminar-in-a-box kits;
  • Free educational webinars;
  • Hispanic online resource portal; and
  • Social media efforts, including a special discussion group on LinkedIn.  
In celebration of four years working together, Coopera and CUNA have focused on implementing several initiatives this year, including:
  • Conducting a pre-conference workshop in partnership with the National Federation of Community Development Credit Unions for the 2013 America's Credit Union Conference (ACUC);
  • Celebrating Coopera Founder Warren Morrow as this year's Credit Union Hero through Credit Union Magazine at ACUC;
  • Planning an emerging markets-focused educational track, in partnership with the federation, for the Community Credit Union and Growth Conference;
  • Launching the Warren Morrow Hispanic Growth Fund through the National Credit Union Foundation to provide grants for credit unions to serve the Hispanic community; and
  • Developing a new product line of culturally relevant promotional items credit unions can use as community giveaways for Hispanic-member outreach.    
Coopera and CUNA continue to plan new collaborative projects for the future, said Mark Condon, CUNA senior vice president.

"As the credit union industry evolves, our partnership with Coopera will continue to play a critical role in helping credit unions thrive," said Condon. "Our efforts will continue to focus on co-developing and launching new resources for credit union leadership and staff, as well as building awareness of opportunities with the Hispanic market through participation in industry conferences.

"We will also continue to work together to provide the information and resources credit unions need to keep up with important industry changes, like impending immigration reform, remittance regulations and more," he added.

HERO Contest To Mark CU Valor In Aiding Members

 Permanent link
WASHINGTON (7/11/13)--The National Cooperative Business Association has created an Honor a HERO contest to mark cooperative and credit union valor in aiding members.

The nationwide campaign to search for a HERO provides a public venue for a cooperative or credit union employee--or the business itself--to share a compelling story about helping members/consumers in financial distress and, in turn, helping them to help themselves.

"This is a fantastic campaign that we are proud to launch to inspire cooperatives to act boldly and to empower consumers across our country," said NCBA CLUSA President/CEO Mike Beall. "As the largest group of cooperatives, credit unions have an opportunity to inspire great change in their members' lives. Co-ops and their employees do amazing work each and every day. This is a chance for these stories to be shared, for these heroes to receive recognition and to revitalize our communities. We want to highlight their stories."

In 200 words or less, credit unions and other co-ops can tell how they are a member of their staff or have been a HERO to:
  • An individual;
  • A cause in their area; or
  • Their community.
The campaign began June 24 and runs to Aug. 24. Written entries can be sent to the resource link below. Winners will be announced in early September.

The campaign stems from the new HERO Counseling service, a Community Development Certified Financial Counseling course certified by the NCBA CLUSA. HERO Counseling will help credit unions provide better financial guidance to their low-income communities--becoming HEROES to their members, board, and bottom line, said NCBA CLUSA.

Stories to help inspire others and announcement of winners will be posted at HERO Counseling on Facebook.

The winning credit union receives HERO Counseling staff training, certification and software--from CU Strategic Planning and NCBA CLUSA for the entire credit union staff. Second and third runners-up receive HERO Counseling training for their department or branch of choice.

Top 10 News Now Articles for June

 Permanent link
MADISON (7/11/13)--An article about the release of the Senate Finance Committee's "tax options" paper on exempt organizations--with the elimination of the credit union tax status written clearly in black and white as a reform option--was the most-read News Now article in June.
 
The Top 10 articles for the month included:
 
10. CUNA Refutes Banks' Tax Attacks In Hill, White House Letters
 
WASHINGTON (6/27/13)--Credit Union National Association President/CEO Bill Cheney Wednesday called it "offensive" that representatives of banks and thrifts, "which time and time again have needed taxpayer funded bailouts," have gone to top policy makers to say that "the government can no longer afford the credit union tax status." Cheney fought off the most recent bank attacks in letters to President Barack Obama and to Senate Finance Committee and House Ways and Means Committee leaders.
 
9. Cheney Report: CUs Concerned About Call Report Changes
 
WASHINGTON (6/10/13)--Credit unions are concerned that a rule going into effect June 30 that changes how credit unions define delinquent loans in call reports could drive up the number of reportable loans for some credit unions, Credit Union National Association President/CEO Bill Cheney said in the most recent issue of The Cheney Report.
 
8. Loan Participation Rule Goes Into Effect July 25
 
WASHINGTON (6/26/13)--July 25 is the effective date of the National Credit Union Administration's final rule on loan participations, which implemented a number of improvements, sought by the Credit Union National Association, from the original proposal.
 
7. NCUA Issues Guidance On Credit Rating Rule
 
ALEXANDRIA, Va. (6/20/13)--Supervisory guidance on a National Credit Union Administration rule regarding the use of credit ratings by natural-person credit unions has been sent to federal examiners and credit unions by the agency.
 
6. ACUC Attendees To Storm Today Show Wednesday
 
MADISON, Wis. (6/27/13)--A group of Credit Union National Association representatives will "storm" the set of the Today show Wednesday in conjunction with CUNA's America's Credit Union Conference, spreading credit unions' "Unite for Good" message to a nationwide television audience.
 
5. Report Debunks Myth Of The Uneven Playing Field
 
FEDERAL WAY, Wash. (6/7/13)--All of the major claims made by critics of credit unions in terms of uneven playing field  are unsubstantiated, says an economic analysis released today. What's more, there is "no evidence that state and federal tax policies give credit unions unfair competitive advantages over banks."
 
4. NCUA Plan Would Limit Loan Participations To 25% Of Net Worth
 
ALEXANDRIA, Va. (6/18/13)--A final rule on loan participations has been added to the National Credit Union Administration's June open board meeting agenda.
 
3. CFPB Overdraft Report Out: Study Will Continue
 
WASHINGTON (6/11/13)--Consumer Financial Protection Bureau Director Richard Cordray states clearly in the bureau's report on financial institutions' overdraft programs, released at midnight, that the bureau does not intend to impede the offering of this service. The Credit Union National Association was among stakeholders included in an early briefing on Monday and CUNA President/CEO Bill Cheney had a personal call from Cordray.
 
2. NCUA Approves Loan Participation Rule
 
WASHINGTON (6/20/13)--The National Credit Union Administration's final approved rule on loan participations implemented a number of changes sought by the Credit Union National Association and is now a much more workable framework for credit unions to utilize loan participations, said CUNA President/CEO Bill Cheney.
 
1. Senate Finance Committee's 'Tax Options' Paper Notes CUs
 
WASHINGTON (6/13/13)--The release today of the Senate Finance Committee's "tax options" paper on exempt organizations--with the elimination of the credit union tax status written clearly in black and white as a reform option--should be a wake-up call for action by credit unions, Credit Union National Association President/CEO Bill Cheney said in immediate response to the paper's release.

Court Dismisses NCUA Lawsuit Over Corporate CU Losses Vs. Barclays

 Permanent link
WICHITA, Kan. (7/11/13)--Saying that the claims are time-barred, a federal court in Wichita, Kan.,Wednesday afternoon dismissed the National Credit Union Administration's lawsuit against  Barclays Capital over the sale of residential mortgage-backed securities (RMBS) that caused losses to U.S. Central FCU and Western Corporate FCU.
 
Also, in a separate ruling Wednesday, U.S. District Judge John W. Lungstrum reaffirmed an earlier ruling he made in a similar lawsuit filed by NCUA against Credit Suisse Securities: that a tolling agreement NCUA had entered into with the defendants, and which NCUA had argued extended the time allowed to file the lawsuits, "is not effective in extending the applicable three-year limitations period under the Extender Statute."
 
NCUA told BloombergBusinessweek yesterday afternoon it couldn't comment immediately on the decision.
 
The agency had filed eight cases against brokerage firms charging that they made misleading statements about the securities they sold to the corporates. The Barclays case addressed $555 million in securities ranging from $12.515 million to $200 million in 12 certificates sold between Oct. 15, 2006, and June 12, 2007, according to the ruling.
 
NCUA argued in all cases filed in the U.S. District Court in Kansas and other districts that it had met the statute of limitations for filing the lawsuits because of tolling agreements that delayed filing dates or because of a statute that extended the time to file in certain situations.
 
"The court reaffirms here the rulings that it issued in the Credit Suisse case concerning the application of that statute," said Lungstrom in the Barclays ruling. "Accordingly, absent some form of tolling, plaintiff was required to file these claims by March 20, 2012, three years after its appointment as conservator for U.S. Central and WesCorp.  Plaintiff did not initiate this action, however, until Sept. 25, 2012," he said.
 
"Nor may plaintiff rely on the Extender Statute's alternative reference to the applicable state-law limitations periods, as this case was filed more than five years after the purchases of these certificates," he said, adding "all of the claims...this action are time-barred, and the plaintiff's complaint is hereby dismissed in its entirety."
 
In Wednesday's Credit Suisse ruling, the court reaffirmed its April 8 dismissal of some of the complaints as time-barred and ruled "that plaintiff may not rely on [the tolling] agreement to avoid application of the Extender Statute's limitations period."
 
The dismissal, if upheld by higher courts, likely will impact not only NCUA's lawsuits but those of other agencies trying to recoup losses from RMBS investments. The Credit Suisse ruling specifically mentioned an amicus brief filed by the Federal Deposit Insurance Corp. and rejected the FDIC's arguments, which were similar to NCUA's.

Oregon Legislative Adjournment Ends CU Tax Bills

 Permanent link
SALEM, Ore. (7/11/13)--The Oregon Legislature adjourned Monday, putting an end to the consideration of bills that would tax credit unions, said the Northwest Credit Union Association.

During the legislative session, the Oregon Bankers Association put together a targeted anti-credit union effort, based on the work done by an anti-credit union task force established last summer, said NWCUA (The Anthem July 9).

The bank lobby supported three anti-credit union bills --HB2484, 2485, and 2486--aimed at taxing many credit unions and implementing new burdensome regulations. Not one of the bills received a hearing in the legislature, even after some editorials called for at least a hearing, NWCUA said.

"We just finished our long session, and all the bills that didn't make it are considered dead," Pamela Leavitt, NWCUA legislative policy adviser for Oregon advocacy and grassroots, told News Now. Those bills would have to be reintroduced in the state legislature's February short session, which lasts 35 days, Leavitt noted, adding she is unaware of any bankers' plans.

"We not only defeated [the bills], we feel we were very successful in defending credit unions," Leavitt said. "We will continue to be prepared to confront taxation and any regulatory bills."

NWCUA will continue to talk to the state legislature, she added. "We have a very progressive advocacy agenda," she explained. "We will continue to meet with legislators and talk to them about the value of the credit union charter."

The 2013 session will be considered one of the most successful in history for credit unions, NWCUA said.

Oregon Gov. John Kitzhaber on June 24 signed SB520, a bill to update the Oregon Credit Union Act. The NWCUA-backed bill was the result of recommendations by the Oregon State Model Act Subcommittee, chaired by Scott Burgess, president/CEO of Rivermark Community CU in Beaverton, and will make several changes to the Oregon Credit Union Act. The changes will take effect Jan.1.

NEW: NCUA Loses Corporate CU Claims Against Barclays Capital

 Permanent link
WICHITA, Kan. (7/10/13, UPDATED 5 p.m. CT)--Saying that the claims are time-barred, a federal court in Wichita, Kan., today dismissed the National Credit Union Administration's lawsuit against  Barclays Capital over the sale of residential mortgage-backed securities (RMBS) that caused losses to U.S. Central FCU and Western Corporate FCU.
 
Also, in a separate ruling today, U.S. District Judge John W. Lungstrum reaffirmed an earlier ruling he made in a similar lawsuit filed by NCUA against Credit Suisse Securities: that a tolling agreement NCUA had entered with the defendants, and which NCUA had argued extended the time allowed to file the lawsuits, "is not effective in extending the applicable three-year limitations period under the Extender Statute."
 
NCUA had argued in eight cases filed against brokerage firms in the court and other districts that it had met the statute of limitations for filing the lawsuits because of tolling agreements that delayed filing dates or because of the statute that extended the time to file in certain situations.
 
The dismissal, if upheld by higher courts, likely will impact not only NCUA's lawsuits but other agencies as well.  The court ruling specifically mentioned an amicus brief filed by the Federal Deposit Insurance Corp. as part of the Credit Suisse case and rejected the FDIC's arguments.
 
NCUA's suit against Barclays related to 12 RMBS certificates sold to the two corporates, which were liquidated as a result of losses stemming from investments prior to the financial crisis.
 
The Credit Union National Association is studying the court documents, and News Now will have more details in Thursday's issue.

Overdraft Price Study: CUs Still the Best Deal

 Permanent link
LAKE BLUFF, Ill. (7/10/13)--The national average price for overdrafts (ODs) on checking accounts rose to $30 as of June, matching the national average charged by banks the past four years.  The cost of overdrafts has risen steadily since 2009, according to a new study, which shows credit unions again remain the best deal for consumers.
 
Credit unions' average for 2013 is $28, one dollar higher than in December 2012, but still considerably lower than what banks have charged the past five years studied, according to data from Moebs Services, a Chicago-area economic research firm specializing in financial services. Banks have charged an average $30 since 2010, when they increased the price from $29. Credit unions charged $25 from 2009 through 2011 before increasing the fees in 2012 to $27.
 
"Despite the increases by credit unions (the past two years), their OD fees remain $2 lower than banks, which is still a statistical difference," said Michael Moebs, economist and CEO of Moebs Services. "Credit unions' falling OD volume forces them to increase price to maintain revenue. Overall industry OD revenue fell in the first quarter to an annualized total of $31.1 billion," he said.
 
However, it may not be the price itself but the frequency of assessing OD charges that underscore the fact that credit unions are the better deal for consumers, said the Credit Union National Association.
 
"In our experience, the stated price of an overdraft fee is not a good indicator of the impact on users," said Paul Gentile, CUNA executive vice president of strategic communications and engagement. "A better indicator is how often the fees are assessed. The data suggest that credit unions impose the fee much less frequently than do banks--resulting in a lower dollar value of fees paid by credit union members than that paid by bank customers," he said.
 
He cited a 2009 study by Victor Stango, PhD., University of California, and Jonathan Zinman, PhD., Dartmouth College, that found bank accountholders incurred more overdraft fees in a typical year--paying fees on an average of four transactions per year. Credit union members, by contrast, paid the fees for an average 1.5 transactions per year.
 
In the Moebs study, the largest of the 2,906 depositories reporting fees as of June, had the highest price--an average of $35 for institutions in two asset categories above $5 billion in assets. That compared with $29 in the $100 million to $500 million asset range and with $25 for smaller institutions.
 
"The consumer who occasionally or frequently overdrafts saves substantially by going to community banks and credit unions," Moebs said.  He noted that institutions with $25 billion to $50 billion had the largest increase--16.7%--in average OD price--to $35 in 2013 from $30 in 2012.
 
The survey also noted regional differences. Financial institutions in the West and Midwest had lower OD prices with a median of $29, compared with $30 in the South and East.

CU System Briefs (07/10/2013)

 Permanent link
  • PORTLAND, Ore. (7/10/13)--Before awarding $50,000 to six non-profits, Portland, Ore.-based Advantis CU tapped the power of the social network, allowing the public to vote on 14 GROW Community Fund semi-finalist non-profits. The $989 million asset credit union told the Northwest Credit Union Association that more than 40,000 votes were cast (Anthem Recap July 3). "Inviting the public to vote helps us understand the priorities of those who live and work in the communities we serve," said Wendy Edwards, Advantis vice president of marketing and human resources. Grants went to: Growing Gardens, $10,000 to buy tools for the Garden Tools for Schools program; Boys and Girls, $5,500 to buy beds for 175 girls ages 10-18 in foster care at the Seneca House; David's Harp, $10,000 to buy a commercial oven for a community kitchen serving low- and no-income adults with mental illnesses; DoveLewis Emergency Animal Hospital, $9,500 for surgical equipment; Impact NW, $10,000 to bring child abuse prevention workshops to Portland elementary schools; and Meals on Wheels, $5,000 to purchase new kitchen equipment ...

LSCU & Affiliates Refreshes Brand For State Advocacy

 Permanent link
BIRMINGHAM, Ala., and TALLAHASEE, Fla. (7/10/13)--The League of Southeastern Credit Unions (LSCU) and Affiliates is refreshing its brand architecture, and plans to launch the refreshed brand Aug. 1.
 
LSCU & Affiliates is the parent brand for the league and its subsidiary organizations--The LSCU Service Corp. (LEVERAGE) and the Southeastern Credit Union Foundation.
 
Two new brands are being added to the structure to enhance the awareness and influence of credit unions in Montgomery, Ala.; Tallahassee, Fla.; and Washington, D.C. The LSCU will begin using the Alabama Credit Union Association (ACUA) and Florida Credit Union Association (FCUA) brands with lawmakers, candidates and regulators for a greater state-specific identity and recognition.
 
"As the LSCU & Affiliates grows, it's important that we constantly look at our brand positioning to ensure that it's also evolving," said LSCU & Affiliates President/CEO Patrick La Pine. "State-specific 'association' resonates much better with lawmakers and candidates. All politics is local.
 
The refresh also will apply to any other organization either fully owned or managed by the LSCU--Credit Union Service Centers of Alabama (CUSC) and Credit Union Vendor Management (CUVM).
 
"Going forward, if other state leagues are interested in consolidating, this new brand positioning demonstrates our commitment for maintaining state-specific brand identity, which we know is becoming an important issue for some," La Pine said.
 
The LEVERAGE brand also received a slight makeover. LEVERAGE is selling more products and services in other states, and will remove the current LSCU Service Corp. tagline from the LEVERAGE logo, LSCU said. A new tagline was developed that is not state/league specific, but shows more of what LEVERAGE means to its clients nationwide.
 
LEVERAGE, "Your Advantage," lets credit unions know that working with LEVERAGE gives them an advantage over their competition, LSCU said.
 
"For Alabama and Florida credit unions, the LSCU & Affiliates will be our main brand and nothing significant will change," said La Pine. "The ACUA and FCUA brand will be laser focused on advocacy efforts only."

What's Next For New Cornerstone CU League?

 Permanent link
FARMERS BRANCH, Texas (7/10/13)--Now that it has a board in place, the next step for the newly created Cornerstone Credit Union League is to form a consolidated strategic plan, Dick Ensweiler, league president/CEO, said.
 
The merger of the Arkansas, Oklahoma and Texas credit union leagues became official July 1, at which time a new board was announced (News Now July 1).
 
The board directed league staff to review the 2013 strategic plans for the leagues in all three states, and consolidate the plans into one document, Ensweiler said (The Leaguer July 9). The board will review the consolidated plan at its September meeting, the first official meeting of the board. The plan will carry the league through 2013, he added.
 
The board will hold its first strategic planning session in 2014.
 
Branding will be a priority for the new board, Ensweiler said. The league is rebranding marketing and promotional materials and updating publications, websites and social media sites.
 
The Texas Credit Union League's former subsidiary, Credit Union Resources, will maintain its identity. The Texas Credit Union Foundation, which consolidated with the foundations in Arkansas and Oklahoma, will be renamed the Cornerstone Credit Union Foundation.

New York CUs Outperforming Banks

 Permanent link
ALBANY, N.Y. (7/10/13)--New York State credit unions began 2013 with a strong financial performance, exceeding bank and national industry averages in several key categories, said the Credit Union Association of New York.

"This report reaffirms that more and more New Yorkers are choosing credit unions for their financial services, from mortgages and business loans, to savings and checking accounts," said William J. Mellin, president/CEO of CUANY. "Along the way, they're discovering the unique financial and personal benefits that come with credit union membership."

The statistics are highlighted in a new quarterly New York Credit Union Performance and Trends Report published by CUANY in partnership with Callahan & Associates Inc.

New York credit unions exceeded national averages in asset, share, membership and loan growth during the first quarter, the report indicated.
 
Highlights include:
  • New York credit unions remain more highly capitalized than their local competitors. As of March, credit unions in the state reported an average capital ratio of 11%--well above their local bank peers, CUANY said.
  • Asset quality for New York credit unions also is stronger than that of banks nationwide, which are charging off 0.83% of their loan portfolios. Credit unions also continue to have a lower delinquency ratio than local and national banks.
  • New York credit unions recorded a return on assets (ROA) in the first quarter that is 41 basis points above local banks' ROA.
  • Credit union loan originations hit $4.4 billion in March 2013--a nearly 9% increase over March 2012.
  • First mortgages, bolstered by the current refinancing boom, continue to be the largest portion of the loan portfolio at New York credit unions. At the end of March, first mortgages made up 41.1% of all outstanding loans.
  • Credit unions originated $850 million in first-quarter member business loans, holding 19.1% of all outstanding small-business loans at New York financial institutions by the end of March.
  • Membership growth at New York credit unions during first quarter remained faster than the national average, CUANY said.

Poll: Consumers Don't Understand Purpose Of a Budget

 Permanent link
WASHINGTON (7/10/13)--Many credit unions with financial education components are aware of surveys that indicate consumers lack the financial knowledge to make sound money decisions. Yet another survey drives home that point. This time, the poll found 57% of consumers surveyed misunderstand the purpose of a budget.

Consumers polled view a budget as a restriction, not a reflection of priorities, said the National Foundation for Credit Counseling (NFCC), which conducted the poll on its website.

"A budget actually provides the structure through which a person can be in charge of his or her spending, directing the dollars to their best use," said Gail Cunningham, NFCC spokesperson. "Spending should be a reflection of a person's priorities, but without a plan, the priorities often get pushed aside in favor of the tyranny of the urgent."

The reluctance to construct a budget suggests people may be afraid to face the financial facts, choosing instead to allow the most pressing financial need or urge of the moment make that decision for them.

That means credit union financial educators will need to explain even more about setting and following budgets. NFCC pointed out that a spending plan provides a number of benefits.   Credit unions can use this list to add to their own financial education arsenal. When educating members about budgets, be sure to explain that a spending plan:
  • Creates a thoughtful awareness of spending;
  • Relieves financial stress;
  • Increases financial security;
  • Helps structure a plan for the future;
  • Allows planning for large purchases;
  • Assists in meeting financial goals;
  • Frees up money to designate for savings;
  • Uncovers money available to invest;
  • Allows preparation for emergencies;
  • Avoids late payments through scheduling timely payments;
  • Finds hidden money for debt repayment; and
  • Potentially raises the credit score.
Credit unions can find a host of financial education materials, including resources for budgeting on the Credit Union National Association's  website, in the Home and Family Finance Resource Center. Use the links.

Instead of being restrictive, a budget often creates more money by use of smart spending choices, said NFCC.  It suggested starting out by tracking spending for one month.

"It's a shame that budgeting has a negative connotation," said Cunningham. "Everyone needs a spending plan, but when times are tough, a budget is even more critical. When every penny counts, it's important to count every penny."

Michigan CUs Team Up For 'Impact Saginaw'

 Permanent link

SAGINAW, Mich. (7/10/13)--Credit unions in Saginaw, Mich., have teamed up for Impact Saginaw, a collaborative effort on special projects to enrich lives of people in the community.
 

Click to view larger image Sixteen credit unions announced Impact Saginaw last week at the Saginaw Children's Zoo. From left are: Nancy Parker of the zoo, Alan Watson of Catholic FCU, Linda McGee of Wildfire CU, Mike Murphy of Tri To Finish, Bridget Looby, Catholic FCU; Tina Dowe of YMCA Saginaw and Dana Tell of Team One CU.

Leaders from all 16 credit unions with offices in Saginaw announced that Impact Saginaw's first activity will be a Triathlon for Kids on July 27, followed by sponsorship of a CU at the Zoo day on Aug. 17 in which families will have a free day at Saginaw's Children's Zoo, according to the Michigan Credit Union League (Michigan Monitor July 8).
 
"We tend to hear more about what's wrong with Saginaw instead of what's right," said Gerald Hutto, president/CEO of Team One CU and chairman of the Impact Saginaw Committee. He came up with the idea that began with a committee of credit unions meeting to talk about ways they could work together to benefit the community. "Because all of the credit unions involved have a strong commitment to this community, we felt it was the right time and place to bring us all together to make a difference."
 

Click to view larger image Local television, radio and newspaper reporters interview Linda McGee, vice president of membership development for Wildfire CU and spokeswoman for Impact Saginaw, a collaborative effort of credit unions to enrich lives in Saginaw, Mich. (Photos provided by the Michigan Credit Union League)

Linda McGee, vice president of membership development at Wildfire CU, welcomed credit union representatives and local dignitaries who gathered at the zoo last week for the announcement. Credit unions recognized they could do more together than individually, she said, adding, "We know this community has been through some tough times and in some cases, continues to go through some tough times."
 
While the first two projects are event-oriented, the group may look to more concrete projects of need for its future efforts.
 
The triathlon will be coordinated through the Saginaw YMCA and race management company Tri to Finish. Credit unions will sponsor the event, giving 300 young people the opportunity to participate for free.  The August event coincides with the zoo's back-to-school event. Impact Saginaw will provide free admission to the zoo, plus free-ride tickets to the first 500 children who attend.
 
Impact Saginaw demonstrates the credit union difference, said Hutto.  "The credit union community is different than many competing institutions. We each operate our credit unions to provide our members with the best in financial services, but we are also interested in making our communities a better place to live, work and play."
 
Team members include: Wildfire CU, Team One CU, Catholic FCU, Wanigas CU, Security CU, Frankenmuth CU, United Financial CU, Saginaw Medical FCU, Family First CU, Generations Family CU, Valley State Employees CU,COPOCO Community CU, Saginaw County Employees CU, First Area CU, Amalgamated CU and Lake Huron CU.
 
Raising public awareness about credit unions is one of the three tenets underlying the Credit Union National Association's and state leagues' Unite for Good rally to bring to reality a strategic vision in which "Americans choose credit unions as their best financial partner." For more on Unite for Good, use the link.

Polish & Slavic FCU Hands Out $200K In Scholarships

 Permanent link
BROOKLYN, N.Y. (7/10/13)--Polish & Slavic FCU last week awarded $200,000 in college scholarships to 280 high school, undergraduate and graduate-level students, marking the 13th year the Brooklyn, N.Y.-based credit union has sponsored the scholarship program.
 
Click to view larger image These students were among the 280 high school, undergraduate and graduate-level students awarded $200,000 in college scholarships through a program sponsored by Brooklyn, N.Y.-based Polish & Slavic FCU. (Photo provided by Polish & Slavic FCU)
The PSFCU Scholarship Awards ceremonies took place in New York and Chicago. Since its inception in 2001, the credit union's scholarship fund has helped make college a reality for more than 2,300 students, while dispensing $2.8 million in financial aid.
 
"Our roots took hold in 1976 with the pledge to help Polish immigrants find a better future in America," said Krzysztof Matyszczyk, PSFCU board chairman. "This laudable scholarship program is consistent with our mission to help our members attain a better and more prosperous future."
 
As in previous years, the PSFCU Scholarship program consisted of three parts:
  • Scholarships for high-school graduates who have been accepted to college;
  • Scholarships for college students; and
  • Acceptance to the "Astronomy Adventure with Copernicus," a program for students enrolled in Polish supplementary schools.
This year also featured a fourth component, "Byc Polakiem," a contest where individuals ages 9-25 competed to win a week-long stay in Poland, with PSFCU covering the travel expenses.
 
The college scholarships awarded by PSFCU to recent high school graduates is administered by the Credit Union Association of New York.  The scholarship program geared toward current college students is conducted solely by PSFCU.

Fund For Fallen Arizona Firefighters At $50,000

 Permanent link
PHOENIX (7/9/13)--Arizona State CU, which lost six members and one former member in the Yarnell Hill Blaze that killed 19 firefighters last week, has collected roughly $50,000 in donations for the fallen firefighters' families, as of Friday.
 
Paul Stull, senior vice president of the Phoenix-based credit union, told Credit Union Magazine Monday that the amount far exceeds the $20,000 match that the credit union hand announced last week.
 
A caravan of 19 fallen firefighters made its way from Phoenix to Yarnell and to Prescott, where it arrived Sunday. The procession went past two Arizona State CU branches, Stull told the magazine.
 
Those branches will be closed for a few hours today--before, during and after the community memorial service.

Donations are ongoing and will be given to the Prescott Fire Department to distribute. For more information, use the link to read News Now's story, Arizona State CU Sets Up Fund For Fallen Firefighters.

CU System Briefs (07/09/2013)

 Permanent link
  • NEWARK, Del. (7/9/13)--Theresa Cannon, 32, of Wilmington, Del., has been charged with robbing a branch of Newark-based Louviers FCU on Kirkwood Highway on July 3 (Associated Press Newswires July 5 and Newark Post Online July 6). According to Delaware State Police, Cannon allegedly entered the credit union wearing a baseball cap that covered most of her face, gave a teller a note demanding money, then fled on foot. She was captured after a short chase when police responding to the robbery call spotted her walking along the highway.  She is charged with second-degree robbery and wearing a disguise during commission of a felony ...
  • RALEIGH, N.C. (7/9/13)--State Employees' CU (SECU) based in Raleigh, N.C., will begin relocating roughly 80 employees by the end of July into a new 12-story SECU tower in downtown Raleigh from other SECU offices (Triangle Business Journal July 5). Employee relocation from the $25.1 billion asset credit union's financial advisory services group will proceed through September, SECU spokeswoman Leigh Brady told the Journal. The new building will include a credit union branch and a six-story parking deck. Construction of the $45 million SECU office building began in late 2009, but went through a delay after a major subcontractor ,who was slated to install all the window panels in the building, filed for bankruptcy, the Journal said ...
  • PORTLAND, Maine (7/9/13)--Lauren Reeves has taken over as the Maine Young & Free spokester. Reeves was announced as the successor to Kylie Keene in mid-June, the Maine Credit Union League said (Weekly Update July 5). Since assuming her new position, Reeves has made several live television and radio appearances. The publicity has directed additional traffic to the Young & Free website, said Debra Trautman, assistant vice president of corporate marketing for the league. Several other radio and newspaper articles are scheduled for the coming weeks, the league said ...
  • RALEIGH, N.C. (7/9/13)--Ben Hill retired June 28 from Blue Flame CU as manager/CEO, culminating a 38-year credit union career. Along the way, Hill's love for numbers and passion for helping credit union members succeed has helped the Charlotte, N.C.-based credit union thrive, said the North Carolina Credit Union League. Hill became manager/CEO of the $37 million asset Blue Flame in 1990. Under his leadership the credit union grew in key areas, including assets, shares, loans and capital. Hill has also been active in the state and national credit union movement. He is a past chairman of the league (2006-2010), a past member of the board of directors for the Carolinas Credit Union Foundation, and was appointed by former North Carolina  Gov. Jim Martin to serve on the North Carolina Credit Union Commission (1992-1995) ...
  • GREENSBORO, N.C. (7/9/13)--Lila Lowe, 71, former office manager and board secretary of Greensboro, N.C.-based Internal Revenue Employees FCU, died May 26 in a University of North Carolina Hospital in  Chapel Hill, the North Carolina Credit Union League  reported in its newsletter, The Weekly Conversation (July 3). Lowe served the credit union for 26 years as office manager and later served as secretary of the board of directors.  She is survived by her husband Jim, daughters Donna and Carol, and grandchildren ...

Wash. DCU Issues Bulletin On CU Act Changes

 Permanent link
FEDERAL WAY, Wash. (7/9/13)--The Washington State Department of Financial Institutions Division of Credit Unions (DCU) issued a bulletin summarizing the new amendments to the Washington Credit Union Act.
 
The amendments become effective on July 28.
 
Washington Gov. Jay Inslee signed Senate Bill 5302--which will allow credit unions to offer board compensation and other updates to the state Credit Union Act--on April 22.
 
Other sections covered in the bulletin include:
  • Special membership meeting notices;
  • Frequency of board meetings;
  • Number of unexcused board absences;
  • Suspension of a member of the board or a member of the supervisory committee;
  • Mutual funds containing permissible investments;
  • Loans to board members;
  • Occupied premises for credit union operations;
  • Majority board vote permitted for merger; and
  • Special board meetings may be called by DCU.
To view the bulletin, use the link.

Harrisburg Patriot-News Endorses PCUA's Better Choice Program

 Permanent link
HARRISBURG, Pa. (7/9/13)--The savings plan that credit unions offer as part of the Credit Union Better Choice program in Pennsylvania was endorsed Friday in an editorial by the Harrisburg (Pa.) Patriot-News Editorial Board.

"Credit unions, working with the state, offer struggling Pennsylvanians short-term loans with more affordable interest rates and longer payback times," said the editorial. "The loans include a savings plan to help the borrowers build up a financial cushion. That way, they won't get locked into repeatedly taking out those expensive short-term emergency loans.

"Instead of letting legal loan sharks set up shop in Pennsylvania, the legislature should be trying to make the credit unions' responsible, short-term lending alternative available to every Pennsylvanian who might need it," the editorial  added.

The Pennsylvania Credit Union Association's Better Choice Program offers a payday loan alternative that includes financial counseling and required saving with a lower-cost, short-term loan. More than 70 credit unions in the state offer 90-day loans with a $500 limit. Since the program began in 2006, it has loaned more than 64,000 short-term loans--totaling $32 million--to credit union members (News Now June 5).
 
The program has saved borrowers more than $23 million over using a traditional payday lending product, said PCUA.   
 
To read the editorial, use the link.

Postcards, Newsletters, More Aiding Tax Status Fight

 Permanent link

MADISON, Wis. (7/9/13)--Members at a credit union in South Dakota have stepped up to the plate to bat for preserving credit unions' tax status. They are among the more than 300,000 contacts credit unions have made so far to Congress in the Credit Union National Association's and the state leagues' nationwide "Don't Tax My Credit Union" campaign.
 

Click to view larger image Black Hills FCU staff in Rapid City, S.D., counted and sorted more than 2,000 "Don't Tax My Credit Union" postcards collected at its Member Service Centers in two days last week. The postcards were hand-delivered to three members of South Dakota's congressional delegation. (Photo provided by Black Hills FCU)

Black Hills FCU in Rapid City, S.D., a low-income community credit union with $966.6 million in assets and 54,038 members, started hand-delivering postcards signed by its members to its congressional delegation on July 2. Another delivery was planned for yesterday.
 
In two days, its members signed more than 2,000 post cards urging Congress not to tax credit unions. Roughly 900 were hand-delivered July 2 to the Rapid City offices of U.S. Sens. Tim Johnson (D) and John Thune (R),  and U.S. Rep Kristi Noem (R), said the Credit Union Association of the Dakotas (The Memo July 8). 
 
"By July 26th, we are trying to get thousands of letters, e-mails and other communications to Congress urging representatives to not eliminate the credit union tax exemption," said CUAD President/CEO Robbie Thompson. "This is our No. 1 priority at this time," he added.
 
Other action by credit unions on the tax-exemption front:

  • In Parlin, N.J.,  Parlin DuPont Employees FCU, which has 633 members and about $4.3 million in assets, featured a "Don't Tax My CU" article as its top story in its July e-newsletter, said the New Jersey Credit Union League (The Daily Exchange July 8). The article connects to CUNA's Don't Tax My CU webpage where members can send a pre-written letter to their congressional representatives to encourage them not to touch the credit union tax status.
  • Essex County Teachers FCU, Bloomfield, N.J., with 2,750 members and $14 million in assets, told the league it included a statement stuffer with its July statements that feature the Don't Tax My CU!" logo and link to the national website.
  • As of June 27, New Jersey credit unions had generated 1,769 Capitol Hill lawmaker contacts, said Chris Abeel, NJCUL director of government affairs. "This issue is too important to rely on a few credit unions to carry the ball," Abeel said in a Facebook posting. "Every credit union must do its part. A credit union can't claim to be fully serving its members if it doesn't take time to advocate on an issue of such critical importance to America's 96 million credit union members."
  • The Pennsylvania Credit Union Association, in a Keystone Extra (July 5) noted that Pennsylvania's credit unions have make 12,842 congressional contacts as of June 30.
  • Others are taking to the media to reinforce the don't-tax message.  For example, Missouri Credit Union Association Senior Vice President Amy McLard told the St. Louis Business Journal Online (July 5) that removing the exemption would become a  tax on working class people who are credit union members. "Even if you are not a member, you get a benefit because credit unions are a check and balance on banks," she said.  First Community CU also was quoted about what happened to mutual savings banks and thrifts which lost their tax exemption and collapsed. They "basically went out of business," said Steve Morgenthaler, senior vice president of finance of the $1.9 billion asset, Chesterfield, Mo.-based credit union.

CUNA's and the leagues' "Don't Tax My Credit Union" campaign is also using social media vehicles such as Facebook, a Twitter handle @CUNAadvocacy and hashtag #Don'tTaxMyCU and the social media micro-video site Vine. To join the action in spreading the message, credit unions can use the Tax Advocacy Tool Kit action. Use the links for more information.
 
Actively participating in the political and grassroots activities is one tenet of CUNA's Unite for Good, where credit unions rally together to help create a nation in which "Americans choose credit unions as their best financial partner."

N.C.'s Amended CU Act Now In Effect

 Permanent link
RALEIGH, N.C. (7/9/13)--A North Carolina bill that amends laws governing credit unions and was signed into law June 19 by Gov. Pat McCrory took effect July 1.
 
HB515 mostly makes changes to create consistency with North Carolina's banking laws as they relate to account provisions, said the North Carolina Credit Union League (The Weekly Conversation July 3).  
 
HB515 creates changes that affect these areas:
  • Minors--The Credit Union Act was previously silent on minor accounts. HB515 adds two provisions to allow a credit union to: 1) treat a minor as an adult for the purposes of share or deposit accounts and 2) create a simple custodial share account that one or more adults may open for a minor.
  • Investment Authority--State-chartered credit unions were permitted to invest in corporate bonds under North Carolina law, but were limited in making investments that have an AAA credit rating. The change under the investment provisions allows a state-chartered credit union to invest in investment grade corporate bonds with at least A+ or an equivalent rating, expanding a state charter's investment authority. State-chartered banks would still have a lower credit rating threshold of BAA.
  • Joint Accounts--Joint account holders can now terminate a joint account or have their names removed from the account.
  • Proper proceduresfor dealing with accounts of decedents who had a disability or had been found incompetent now are outlined under the Credit Union Act.
  • Powers of Attorney (POA)--The addition of a POA section provides clarity on when a credit union can rely on POAs without liability--until the time of receipt of actual notice of the principal's death or a written notice of revocation signed by the principal. That creates consistency with North Carolina banks in dealing with POAs.

Archbishop Of Canterbury Forms CU For Clergy

 Permanent link
LONDON (7/9/13)--The Archbishop of Canterbury has formed a credit union--the Clergy Mutual CU--and became the credit union's first member Sunday, according to his website.
 
The credit union will serve clergy and church staff in England and Scotland, using the Church of England's and Church of Scotland's  reach to expand access to credit unions, reported the London Telegraph (June 30).
 
The move aims to boost competition and create a more diverse financial sector, said Malcolm Brown, the Church of England's director of mission and public affairs, in the Telegraph article. 
 
Archbishop Justin's website noted the new credit union is "part of efforts to boost credit unions in all communities" in England and Scotland. He has praised credit unions and their role in deprived areas.
 
Plans call for encouraging church members with relevant skills to volunteer at the financial cooperatives. Small, local lenders also could be invited to use church buildings and other community locations with the help of church members, he said.
 
Credit unions are already being touted by the Duchess of Cornwall. Camilla joined a credit union--London Mutual CU in Peckham, England, in May, and had visited a number of credit unions in the previous 12 months in a show of support for credit unions that provide alternatives to payday lenders (News Now May 17).

Cornerstone CU Foundation Awards Relief To Flood Victims

 Permanent link
FARMERS BRANCH, Texas (7/9/13)--The Cornerstone Credit Union Foundation, the charitable arm of the Cornerstone Credit Union League, has four emergency grants to employees of Del Rio, Texas-based Border FCU, who were affected by flooding in Eagle Pass, Texas in June.
 
Disaster relief is a critical function of the foundation. In addition to assisting credit union staff impacted by the flooding, the foundation also provided emergency grants to credit union staff impacted by the recent tornadoes in Oklahoma.
 
The foundation was able to respond to the needs of credit union staff impacted by natural disasters because of the support of the credit union community, said Executive Director Courtney Moran. For example, after the devastating tornadoes in Oklahoma on May 20, more than $161,000 in donations was received, allowing the foundation to provide immediate assistance to credit union employees in need.

Georgia Announces New Banking Regulator

 Permanent link
ATLANTA (7/9/13)--Kevin Hagler has been appointed commissioner of the Georgia Department of Banking and Finance by Gov. Nathan Deal.
 
The appointment was effective July 1 (Associated Press June 28).
 
"By choosing Kevin Hagler, the governor has chosen someone who has earned respect from all within the credit union system for being a fair regulator," said Mike Mercer, president/CEO of Georgia Credit Union Affiliates. "Kevin has been open to discussion with credit unions and the state trade association and uses a collaborative approach when evaluating state regulatory issues and dealing with credit union issues."
 
Deal replaces Robert Braswell, who is leaving the regulatory agency to become a lobbyist for the banking industry.
 
Hagler has worked as the department's deputy commissioner for supervision since 2008. He is responsible for oversight of state-chartered credit unions and trust companies. He previously worked at Altus Bank in Mobile, Ala., and SunTrust Bank in Atlanta.

CU System Briefs (07/08/2013)

 Permanent link
  • PORTLAND, Maine (7/8/13)--A scheduling conflict has prompted the Maine Credit Union League to change the date and location for its 2014 Annual Meeting & Convention--to June 26-28, 2014, in Portland.  The league had announced at this year's convention  that next year's event would be June 19-21 in Bangor. It has since been advised of a scheduling conflict for those dates. As a result, the board approved the new date and location. The convention will be held at the Holiday Inn by the Bay in Portland.  The change also affects the league's Annual Convention Golf Tournament for Ending Hunger, which will return to Belgrade Lakes Golf Course in Belgrade on June 26, 2014 ...
  • BRADENTON, Fla. (7/8/13)--Sherod Halliburton has taken the helm as president of Bradenton, Fla.-based Manatee Community FCU. Halliburton succeeds Cindy Barco, who retired after 35 years. Halliburton has served as the $25 million asset credit union's executive vice president since February 2012.  In 2007, he became the first non-Tropicana employee ever appointed to the board of directors and was instrumental in expanding the credit union's membership from Tropicana employees into a community development financial institution (Bradenton Herald July 3).  Before that  Halliburton was executive director for the Bradenton Central Community Redevelopment Agency ...

CUAD Inducts Three To Hall Of Fame

 Permanent link
BISMARCK, N.D. (7/8/13)--The Credit Union Association of the Dakotas inducted three credit union professionals into the CUAD Hall of Fame in a ceremony during an awards banquet at its Annual Summit in Grand Forks, ND.

 
The three inductees are:
  • Marvel Ebenhahn, president/CEO, Community CU, New Rockford, N.D.;
  • Patty Pretzer, former marketing vice president, Town & Country CU, Minot, N.D.; and
  • Dick Schmidt, board member, Service First FCU, Sioux Falls, S.D.
Ebenhahn has worked 60 within the credit union system.  She is Community CU's first and only manager.
 
Pretzer retired in 2012 after 26 years with Town & Country CU.  As vice president of marketing, she coordinated advertising, promotions, community relations, special events, and member services. She was active in the Credit Unions United Chapter of Minot, serving on the board for many years, and was also a strong advocate for youth financial literacy, said CUAD.
 
Schmidt has been committed to the credit union movement in South Dakota for the past 40 years.  He has championed the underserved, and urged credit union management and board to look beyond credit scores and focus on character and collateral.

More Than 100 CU Advocates 'Unite' Outside Today Show

 Permanent link

NEW YORK (7/8/13)--More than 100 credit union advocates decided "what better way to start off 'Today'" than to  gather outside of NBC's Today Show in bright-blue Unite-for-Good and aSmarterChoice T-shirts to help spread awareness about credit unions. The fun and unique effort was the brainstorm of the Credit Union National Association and was executed the final day of CUNA's America's Credit Union Conference (ACUC), held in New York City from June 29 to July 3.

Click for slide show Today Show host Savannah Guthrie waves to some of the 100 or more credit union folks who showed up in the New York City dawn at the Today Show site wearing Unite for Good and aSmarterChoice t-shirts to foster awareness of credit unions. (CUNA Photo)


 
As anyone familiar with morning television knows, the Today Show attracts an iconic crowd each morning it airs, as fans visible through windows behind the show's hosts can be seen as they wave "Happy birthday, Mom" signs or wear "Will you marry me, Josie" T-shirts.
 
"When we first conceived of this, we were kind of wondering what kind of turnout there would be when we asked attendees to get up at 6 a.m. on the last day of the conference for the show," CUNA Vice President of Marketing Communications Amy Nigrelli said of the event. "It became clear really quickly that credit union folks were really up for this. We are thrilled that so many people participated." 
 
The credit union crowd, not part of the official show, got some great exposure as they formed a window-framed backdrop--waving their Unite for Good and aSmarterChoice signs--to musical giant Usher as he chatted and joked with the show's hosts.

The Unite for Good T-shirts, however, were no joke.  They refer to CUNA's new strategic vision, being embraced by credit unions across the country, where "Americans choose credit unions as their best financial partner."  The vision promotes three key goals credit unions will need to reach to achieve CUNA's shared vision for the credit union system: removing barriers, creating awareness and fostering service excellence.
 
And the aSmarterChoice T-shirts, of course, refer to the consumer website created by CUNA and the state credit union leagues, which helps people find a credit union to join.
 
Also during the ACUC, the throngs of people moving through one of Manhattan's most bustling thoroughfares, Times Square, saw a message in the neon lights letting them know that, in part due to their current tax status, credit unions provide benefits for their members including higher rates on savings for members and lower fees.  The message also shared shared the DontTaxMyCreditUnion.org website address.

In June, the Times Square crowds saw they would get better rates and lower fees by switching to a credit union, and were urged to find one at www.aSmarterChoice.org on the same CBS electronic billboard.
 
CUNA arranged for the message to run hourly--and four times for the tax message--on the iconic CBS Screen on famed 42nd Street beginning April 15 and running through July 4.
 
Attending the Today show was one of many media news outlets CUNA  interacted with while in New York City for the ACUC. The other outlets included The New York Times, Wall Street Journal, Forbes, Fortune Magazine, FOX Business Network, Reuters and USA Today.

Grant: Don't Give Until It Hurts

 Permanent link
NEW YORK (7/8/13)--Is workplace altruism a sucker's bet? It can be if you help others to the detriment of yourself, said professor and author Adam Grant on the final day of the Credit Union National Association's America's Credit Union Conference (ACUC)  here.
 
Don't be too altruistic in the workplace, warned Adam Grant, Wharton School of Business professor and author of "Give and Take: A Revolutionary Approach to Success." Being a doormat is a sure recipe for frustration in the workplace, he told credit unions at the final general session Wednesday at America's Credit Union Conference. ACUC was presented by the Credit Union National Association in New York City June 28-July 3. (CUNA photo)
Grant, a Wharton School of Business professor and the author of "Give and Take: A Revolutionary Approach to Success," identified three types of employees:
  • Givers, those rare folks who enjoy helping others without taking credit;
  • Takers, manipulative people who try to get as much as they can from others without giving anything in return; and
  • Matchers, those who'll help others as long as they eventually get something in return.
Most employees, Grant said, fall into the final category.
 
Givers, Grant warned, often can be the worst performers: "They can be the least productive and make the most errors because they're too busy helping their peers." In the long run, however, those who help others succeed often advance themselves because they help create value for their organizations.
 
"If we create an atmosphere where givers thrive," Grant said, "we can lift all boats."
 
Grant told his credit union audience that organizations can create such a culture by:
  • Getting the right people on the bus and, conversely, "keeping the wrong people off the bus";
  • Recognizing, rewarding, and promoting givers;
  • Tracking who in the organization helps others and adds value; and
  • Establishing a culture where people feel free to ask for help.
Asking for helps is "hard for givers, but it must be done sometimes," Grant said. "Successful givers ask for help; failures try to go it alone."
 
Takers tend to have certain traits in common, according to Grant's research. CEOs who are takers tend to say "I" and "me" instead of "we," and they often have salaries far higher than those of their colleagues.
 
These CEOs also can be self-satisfied and vain, often displaying large photographs of themselves, indicating "it's all about me." Disgraced Enron CEO Kenneth Lay, for example, published a full-page photo of his face in the company's 1997 annual report--a telling indication, Grant said, of his onerous intentions.
 
But like Lay, many takers are adept at hiding this trait, the final ACUC keynote speaker said Wednesday. They appear to give, but don't. "If you're a taker, you want people higher up to think you're generous. It's all about kissing up and taking others out."
 
One way givers can help others without being taken advantage of is by doing "five-minute favors," quick, easy tasks such as making an introduction or providing recognition, Grant said. If the recipient doesn't reciprocate, chances are he or she is a taker.
 
"Giving is sometimes seen as a sign of weakness," Grant assessed. "But it can be a strength."
 
CUNA's ACUC was held here June 28 to July 3.  For full coverage of the events use the links to News Now and Credit Union Magazine.

How CUs Fared During Superstorm Sandy--From ACUC

 Permanent link
NEW YORK (7/8/13)--Surviving and recovering from a devastating event such as Superstorm Sandy requires a well-rehearsed disaster preparation plan and consistent communications with members and staff.
 
Click to view larger image Mike Retelle, right, CUNA Mutual Group property and claims manager, facilitated a panel discussion on lessons learned from Superstorm Sandy during a breakout session at America's Credit Union Conference Tuesday in New York. At left is Shawn Gilfedder, president/CEO of McGraw-Hill FCU. (Photo provided by CUNA Mutual Group)
That was the message shared Tuesday by three CEOs whose credit unions were greatly impacted by last October's disaster, during an America's Credit Union Conference Discovery breakout session.
 
The conference, presented by the Credit Union National Association, ended Wednesday.
 
CUNA Mutual Group Property and Casualty Claims Manager Mike Retelle facilitated a panel discussion that included Robert Allen, president/CEO, Teachers FCU, Hauppauge, N.Y.; Gene Brody, president/CEO, Bay Ridge FCU, Brooklyn, N.Y.; and Shawn Gilfedder, president/CEO, McGraw-Hill FCU, East Windsor, N.J.
 
As one of the largest Atlantic hurricanes on record, Sandy left a swath of destruction 900 miles wide across 24 states, killed at least 80 people in the U.S., and caused more than $65 billion in damage, according to published reports in LiveScience.com and the Los Angeles Times. While all of the panelists' credit unions remained operational during and after the storm, life for many in the affected area has not returned to normal eight months after it occurred.
 
"Sandy still has a lingering effect on our membership as insurance recoveries have, for the most part, not covered all their damages," Brody said. "Many of our properties that serve as collateral for our loans are still in need of further renovation and reconstruction."
 
The physical and emotional damage caused by Sandy is permanent, Brody added. "Many people had to leave their properties for long periods of time, and some have still not gone back to their homes."
 
Teachers FCU members were afforded temporary relief from their loan payments for up to six months to have the necessary cash flow to fix their properties. The credit union also offered new loans to help affected members renovate their properties and gave employees time off to tend to their properties as well as cash or loan assistance, if needed.
 
Despite having disaster preparation plans in place, credit unions identified areas for improvement. The three panelists offered these recommendations to their colleagues:
  • Review and update the credit union's disasters preparedness policy and procedures on an ongoing basis;
  • Practice leadership before a crisis, have a documented plan representing all facets of the organization and be prepared for the unknown;
  • Maintain consistent and direct communication with staff and members;
  • Realize perception will become reality if not managed during and after the crisis;
  • Identify staff's personal needs. They are impacted by these events personally just like members; and
  • Employees' core values showcase themselves during times of crisis--make sure all employees have a clear vision of the organization's mission and vision.
During his 30-plus years at CUNA Mutual Group, Retelle said he has seen the bond among a credit union, its staff, and its members strengthen in stressful times. Being prepared to successfully react to a major crisis will showcase a credit union's focus and core values, he added.
 
"The actions taken by these credit unions spoke volumes to their staffs and members that even in the worst of times the credit union was willing to help on the personal side and still make sure the member's financial needs were cared for," he added. "They showed that their staffs are more than just employees and their members more than just an account number; they are all part of the credit union's family."
 
If you missed News Now's and Credit Union Magazine's coverage of the ACUC, use the links below.

Emerging Loss Trends Threaten CUs' Financials--From ACUC

 Permanent link
NEW YORK (7/8/13)--Credit unions are becoming more susceptible to emerging-loss exposures that can cause immediate losses or result in third-party claims, litigation and subsequent losses, a CUNA Mutual Group risk management specialist said during an America's Credit Union Conference Discovery Breakout Session Wednesday.
 
Click to view larger image Credit unions face a two-pronged loss threat--from fraudulent acts committed directly against the institution and through litigation by third parties--Roger Nettie, CUNA Mutual Group senior risk management consultant, said during a Discovery Breakout Session at America's Credit Union Conference in New York Wednesday. (Photo provided by CUNA Mutual Group)
Roger Nettie, CUNA Mutual Group senior risk management consultant, said credit unions face a two-pronged loss threat---from fraudulent acts committed directly against the institution and through litigation by third parties.
 
The conference, presented by the Credit Union National Association in New York City, ended Wednesday.
 
Direct losses can result from myriad reasons, including employee dishonesty, illegal funds transfers and electronic crime. Employee dishonesty is universal, but the most commonly victimized organizations are in banking and financial services, according to the 2012 Global Fraud Study conducted by the Association of Certified Fraud Examiners.
 
The study indicated employee frauds lasted a median of 18 months before detection, with a median loss of $140,000. The study showed more than one-fifth of these caused losses of at least $1 million. "The longer a perpetrator works for an organization, the higher fraud losses tend to be," Nettie said. "CUNA Mutual Group claims records show that over a five-year period, employee dishonesty represented just 13% of fraud claims, but 45% of fraud losses."
 
Many credit unions believe their employees are all trustworthy and that they have strong enough internal controls to prevent internal theft from occurring. Yet, it still occurs.
 
"Fraud does not discriminate," Nettie said. "There is no immunity to this exposure based on geography, asset size, employee tenure, or past experience."
 
Another growing area of direct losses is wire fraud, especially from home equity line of credit accounts, with credit unions reporting more than $25 million in losses from 2007 to 2012. The average reported loss in 2012 was $175,000, with some approaching $1 million. "Credit unions experiencing losses generally had inadequate security for large dollar transfers, enabling crooks to easily defeat callback security measures," Nettie said.
 
Consequently, CUNA Mutual Group implemented new terms with its funds transfer coverage to encourage additional controls for remote requests and discourage the practice of accepting large-dollar remote requests. Nettie offered recommendations to limit wire fraud, such as spotting fraud red flags and using layered levels of security.
 
Also, electronic crime continues to cause direct losses through computer malware and money mules who illegally transfer money on behalf of scam operators, typically in another country. Prevention measures such as cookies, device recognition, Internet protocol and challenge/response questions have limited effectiveness. As alternatives, Nettie suggested out-of-band authentication, hardware tokens, digital certificates and biometrics.
 
Liability losses for credit unions continue to be led by employment practices liability (EPL) claims and subsequent litigation. "EPL losses make up nearly two-thirds of all of CUNA Mutual Group Management and Professional Liability losses, with the most common allegations being wrongful termination, retaliation, and race and gender discrimination," Nettie said. He suggested credit unions have updated policies and procedures reviewed by legal counsel and provide regular staff training.
 
Nettie also discussed the growing incidence of costly lender liability claims, which generally allege the credit union failed to follow state law requirements in their Notices of Intent to sell repossessed property and Notices of Deficiency letters. "Usually, this is a case of you getting sued by your worst borrower and then having it mushroom into a class action lawsuit," Nettie said. "It's vitally important to have your forms reviewed and approved by legal counsel for each applicable state, and train employees on how to properly complete the forms."
 
If you missed News Now's and Credit Union Magazine's coverage of the ACUC, use the links below.

Tax-status Preservation Efforts Continue At Leagues, CUs

 Permanent link
MADISON, Wis. (7/8/13)--The Credit Union National Association and state leagues and associations across the country are urging credit unions to engage their members in preserving the tax status of credit unions. Credit unions, in turn, are doing their part, including asking for "love letters."
 
In Washington state, Spokane Teachers CU invited nine other credit unions from the region to a June 21 "summit" to discuss strategies for working together on the tax status issue. The group aims to tap into the same cooperative energy that provided results last year in Spokane on the issue of raising credit unions' member business lending cap, said the Northwest Credit Union Association (Anthem Recap June 28). Last year Spokane credit unions collected 5,000 member signatures in two weeks for that effort.
 
This time around, STCU President/CEO Tim Johnson and his staff decided to keep the message positive to fit in with its vision statement, "To be the most loved and valued financial relationship on earth." The result: a campaign asking members to "Write us a love letter." Between July 15 and July 26, frontline staff at STCU's 16 branches will ask members to sign a petition that says, "We love our not-for-profit credit union!"
 
The credit union will keep the message more general because too specific language may not work in all situations, STCU told NWCUA.  This year's petition is addressed to no one specifically and makes no mention of pending legislation or congressional discussions. Instead, it will include a short summary of the benefits provided by credit unions, ending with this request: "Help preserve tax-exempt credit unions. It's good for consumers and communities."
 
The credit union also is encouraging back-office employees to obtain at least one letter to members of Congress from credit union supporters, saying they love their credit union just the way it is. Writers are asked to deliver their letter--typed or handwritten and  short or long--to an employee or a branch. Or they can call the credit union to pick up the letter.
 
To encourage staff to write their own letters, the credit union is staging letter-writing parties in its headquarters' cafeteria. STCU has informed staff about the campaign through the company's intranet site, its daily e-newsletter for employees and direct e-mails from Johnson. Now its Community Relations and Communications staff are visiting each branch for staff meetings, providing talking points and other materials including letter-writing tips that can be used by both employees and members.
 
STCU  also is educating members about the effort  through its summer member newsletter , on its website and in its social media platforms. When the petition drive begins June 15, the "Write us a love letter" message will appear on plasma screens and other branch materials. Word of mouth is expected to be the biggest driver for the effort.
 
During the June 21 meeting, STCU provided other credit unions with logo-free versions of its petitions and collateral materials that can be adapted to fit other credit unions.  The goal is to put all petitions and letters together in binders by the time Congress starts its summer recess on Aug. 5.
 
NWCUA also reported that Northwest credit unions are rolling out internal and external campaigns to support the "Don't Tax My Credit Union" campaign. Oregon Community CU in Eugene is leading that charge, producing more than 1,800 contacts to Congress in the past few weeks, while Red Canoe CU in Longview, Wash., leads with 497 contacts--the result of one e=-mail "ask" to its members (Anthem Recap June 28).

Examples in other states:
  • Michigan credit union supporters made nearly 3,600 contacts with their lawmakers in Congress, said the Michigan Credit Union League, citing statistics from the Credit Union National Association (Michigan Monitor July 1). The league said Michigan had 3,582 contacts, mostly through the website CUNA set up for the "Don't Tax My Credit Union!" campaign at donttaxmycreditunion.org.
  • Maine credit unions have generated nearly 1,000 e-mails and letters to senators in the past two weeks telling them "Don't Tax My Credit Union," said the Maine Credit Union League Friday (Weekly Update July 5). It encouraged those who have not responded yet to the Call to Action to do so.
  • Last week the Association of Vermont Credit Unions said it was "putting the final touches on a letter to all credit union CEOs and board chairs urging them to reach out to members," said AVCU's newsletter, Newslines Express (June 28). It pointed credit unions to CUNA's Tax Status Advocacy Toolkit.

Appeals Court: Lower Court Erred In Dismissing CU Breach Suit

 Permanent link
KNOXVILLE, Tenn. (7/8/13)--A Tennessee appellate court Wednesday overturned a lower court's ruling that dismissed a lawsuit by Copper Basin FCU (CBFCU) and CUMIS Insurance Society against FiServ Solutions Inc. over nearly $545,000 in losses incurred during a data breach.
 
The Court of Appeals of Tennessee at Knoxville reversed the decision and remanded the case to the lower court for further proceedings, saying "we hold that the complaint alleges sufficient facts to allow the case to proceed, and, therefore, dismissal was in error."
 
The credit union is alleging negligence and breach of contract stemming from a computer hacking in which it found out that its antivirus firewall and protection software had not been activated and allowed for hackers to access passwords and change user names. CUMIS's insurance policy covered the funds in the event of a computer hacking.
 
At issue was a master agreement between CBFCU and Fiserv's Integrasys division for technical support and Web defense services, which required the purchase of Trend Micro Antivirus Firewall and Protection software. The contract subscription was renewed in May 2009. In July 2009, credit union employees contacted FiServ about an unusual number of "pop-up" advertisements on their computers, and FiServ informed them it corrected the problem, said the court's opinion document.
 
On July 15, the credit union learned about the hackers'  origination of  "transfers from CBFCU's account with Volunteer Corporate into a large number of privately owned accounts distributed in banks across the U.S.," said the ruling.  The credit union and VolCorp retrieved all but $544,789.41 of the stolen funds. Afterward, according to the court documents, the credit union discovered the Web defense software had never been activated. It filed suit on July 12, 2011.
 
FiServ had argued that the credit union had filed the case too late and that the Web defense and technical support duties were governed by the master agreement. The credit union said a separate, earlier contract applied to the case, and that the master agreement covered only provision data process services.
 
The appellate court said that the lower court's reliance on the master agreement  in dismissing the case was in error and that the suit had been filed within the time period allowed.

"Of course we're pleased with the appellate court decision, but because this matter is still pending, we are not able to comment further," Phil Tschudy, media relations manager of CUNA Mutual Group, told News Now.

NEW: Grant: Don't Give Until it Hurts

 Permanent link
NEW YORK (7/5/13--UPDATED 11:15 a.m. ET)--Is workplace altruism a sucker's bet? It can be if you help others to the detriment of yourself, said professor and author Adam Grant on the final day of the Credit Union National Association's America's Credit Union Conference (ACUC)  here.
 
Grant, a Wharton School of Business professor and the author of "Give and Take: A Revolutionary Approach to Success," identified three types of employees:
  • Givers, those rare folks who enjoy helping others without taking credit;
  • Takers, manipulative people who try to get as much as they can from others without giving anything in return; and
  • Matchers, those who'll help others as long as they eventually get something in return.
Most employees, Grant said, fall into the final category.
 
Givers, Grant warned, often can be the worst performers: "They can be the least productive and make the most errors because they're too busy helping their peers." In the long run, however, those who help others succeed often advance themselves because they help create value for their organizations.
 
"If we create an atmosphere where givers thrive," Grant said, "we can lift all boats."
 
Grant told his credit union audience that organizations can create such a culture by:
  • Getting the right people on the bus and, conversely, "keeping the wrong people off the bus";
  • Recognizing, rewarding, and promoting givers;
  • Tracking who in the organization helps others and adds value;
  • Establishing a culture where people feel free to ask for help.
Asking for helps is "hard for givers, but it must be done sometimes," Grant said. "Successful givers ask for help; failures try to go it alone."
 
Takers tend to have certain traits in common, according to Grant's research. CEOs who are takers tend to say "I" and "me" instead of "we," and they often have salaries far higher than those of their colleagues.
 
These CEOs also can be self-satisfied and vain, often displaying large photographs of themselves, indicating "it's all about me." Disgraced Enron CEO Kenneth Lay, for example, published a full-page photo of his face in the company's 1997 annual report--a telling indication, Grant said, of his onerous intentions.
 
But like Lay, many takers are adept at hiding this trait, the final ACUC keynote speaker said Wednesday. They appear to give, but don't. "If you're a taker, you want people higher up to think you're generous. It's all about kissing up and taking others out."
 
One way givers can help others without being taken advantage of is by doing "five-minute favors," quick, easy tasks such as making an introduction or providing recognition, Grant said. If the recipient doesn't reciprocate, chances are he or she is a taker.
 
"Giving is sometimes seen as a sign of weakness," Grant assessed. "But it can be a strength."
 
CUNA's ACUC was held here June 28 to July 3.  For full coverage of the events use the links to News Now and Credit Union Magazine.

ACUC: Maximize Non-interest Income Through Member Relationships

 Permanent link
NEW YORK (7/5/13)--To grow non-interest income in today's economy, credit unions must focus on the areas they can control, with emphasis on building deeper member relationships, a CUNA Mutual Group representative told an America's Credit Union Conference (ACUC) Discovery breakout session Tuesday.
 
Click to view larger image With an influx of new members in the past 18 months, credit unions have a great opportunity to build share of wallet, Bob Larson, financial support consultant for CUNA Mutual Group, said during a Discovery breakout session at America's Credit Union Conference in New York Tuesday. (Photo provided by CUNA Mutual Group)
Bob Larson, financial support consultant for CUNA Mutual Group, discussed strategies for growing non-interest income in a changing environment.
 
The conference, presented by the Credit Union National Association in New York City, ended Wednesday.
 
"You will do better in today's economy by focusing on what you can control, not on what you can't control," said Larson. "Start with understanding your current credit union membership as well as those who've just joined your credit union.
 
"During the past 18 months, credit unions have added a great number of new members," he added. "Credit unions need to make sure they tap into new members by cross-selling additional services: loans, debit cards, credit cards, bill pay, etc. The more services, the deeper the relationship."
 
To deepen member relationships, credit unions must make sure they have a strong, transparent sales culture focused on building lasting member relationships, he said. The four key components for a successful sales culture are:
  • Champion--Have top-down management commitment and communication;
  • Train--Prepare staff to meet member needs with confidence;
  • Coach--Provide staff with consistent recognition and positive reinforcement to align management and staff behaviors to support credit union goals; and
  • Track--Inspect quantifiable data for coaching, training and making improvements.
A credit union's sales culture should start and end with the member, Larson said. "Let the member control the process because, as  (credit union pioneer) Roy F. Bergengren so eloquently stated, 'the most important service of the credit union is the education of its members in the management and control of their money,' which is exactly what ultimately drives your credit union's sales culture," he added.
 
Current market conditions have greatly impacted credit unions' earnings. Now, more than ever, credit unions must explore every aspect of their income statement to leverage additional income and to keep their revenue stream flowing. Larson added that members' and credit unions' interests have never been so well-aligned before, so credit unions should take advantage of this by aligning their sales cultures to meet members' needs.
 
Larson recommended that with the future threat of rising interest rates, credit unions should take time to develop a strategy to move some certificate dollars from the balance sheet to a wealth management program to improve the loan-to-share ratio, which will generate additional non-interest income in gross dealer concessions for the credit union.
 
If you missed News Now's and Credit Union Magazine's coverage of the ACUC, use the links below.

Attorney To ACUC: CUs Should Act To De-risk Social Media

 Permanent link
NEW YORK (7/5/13)--Credit unions should implement policies and procedures to protect themselves against possible liability related to their use and their employees' use of social media, said attorney Kevin Funnell of Bieging Shapiro & Barber LLP  at a Discovery Breakout Session during the 2013 America's Credit Union Conference Wednesday.
 
The Credit Union National Association's ACUC ended Wednesday in New York City. The Discovery session was sponsored by CUNA Mutual Group.
 
A recent survey indicated that 62% of U.S financial institutions were not using social media or had no immediate plans to use it because they were worried about compliance, Funnell said.  "Most Americans are involved in social media," Funnell said. "There are 157 million Facebook users already, and 47% of adults use social media."

Also, new media present risks that traditional media don't--primarily a lack of control over content and a heightened sense of risk, Funnell added. "Social media is relatively new, and there are some well-settled legal rules, but not for financial institutions," he explained. "It's an open forum and there is a world full of possible plaintiffs and the fear of the unknown."
 
Some legal risks when a financial institution markets to a member/customer through social media  include: 
  • Deceptive advertising;
  • Intellectual property infringement/plagiarism;
  • Defamation/trade libel;
  • Disclosure of trade secrets or private information; and
  • Is it a conversation or advertising?
Legal risks when an employee uses a financial institution's social media include:
  • Leaking confidential information;
  • Committing defamation;
  • Admissions against the financial institution's interest;
  • Binding the financial institution to a promise;
  • Legal and regulatory violations;
  • Inability to regulate communication; and
  • Reputational risk.
Credit unions and financial institutions need to have clear internal written policies regarding copyright infringement, defamation, trade libel, use of non-public personal information and dishonesty (deceptive trade practices). "The key is to enforce policies consistently" to avoid any legal problems regarding unfairness of their application, Funnell said.

He concluded with social media policy takeaways for financial institutions. They are:
  • Strike a balance between the specific and the general.
  • Be aware that National Labor Relations Board rules apply--even without a labor union.
  • Understand that informed managers are the key.
  • Realize the NLRB has been making aggressive interpretations (in favor of employees).
  • Review Individual policies and procedures.
If you missed coverage of the ACUC, visit News Now and Credit Union Magazine at the links.

CUs 'Unite' Outside Today Show

 Permanent link

NEW YORK (7/5/13)--More than 100 credit union advocates decided "what better way to start off 'Today'" than to  gather outside of NBC's Today Show in bright-blue Unite-for-Good and aSmarterChoice T-shirts to help spread awareness about credit unions. 
 

Click for slide show Today Show host Savannah Guthrie waves to some of the 100 or more credit union folks who showed up in the New York City dawn at the Today Show site wearing Unite for Good and aSmarterChoice t-shirts to foster awareness of credit unions. (CUNA Photo)

The fun and unique effort was the brainstorm of the Credit Union National Association and was executed the final day of CUNA's America's Credit Union Conference (ACUC), held in New York City from June 29 to July 3.
 
As anyone familiar with morning television knows, the Today Show attracts an iconic crowd each morning it airs, as fans visible through windows behind the show's hosts can be seen as they wave "Happy birthday, Mom" signs or wear "Will you marry me, Josie" T-shirts.
 
"When we first conceived of this, we were kind of wondering what kind of turnout there would be when we asked attendees to get up at 6 a.m. on the last day of the conference for the show," CUNA Vice President of Marketing Communications Amy Nigrelli said of the event. "It became clear really quickly that credit union folks were really up for this. We are thrilled that so many people participated." 
 
The credit union crowd, not part of the official show, got some great exposure as they formed a window-framed backdrop--waving their Unite for Good and aSmarterChoice signs--to musical giant Usher as he chatted and joked with the show's hosts.

The Unite for Good T-shirts, however, were no joke.  They refer to CUNA's new strategic vision, being embraced by credit unions across the country, where "Americans choose credit unions as their best financial partner."  The vision promotes three key goals credit unions will need to reach to achieve CUNA's shared vision for the credit union system: removing barriers, creating awareness and fostering service excellence.
 
And the aSmarterChoice T-shirts, of course, refer to the consumer website created by CUNA and the state credit union leagues, which helps people find a credit union to join.
 
Also during the ACUA, the throngs of people moving through one of Manhattan's most bustling thoroughfares, Times Square, saw a message in the neon lights letting them know they'll get better rates and lower fees by switching to a credit union, and urging them to find one at www.aSmarterChoice.org.
 
CUNA arranged for the message to run hourly on the iconic CBS Screen on famed 42nd Street beginning April 15 and running through July 4.
 
Attending the Today show was one of many media news outlets CUNA  interacted with while in New York City for the ACUC. The other outlets included The New York Times, Wall Street Journal, Forbes, Fortune Magazine, FOX Business Network, Reuters and USA Today.

CU System Briefs (07/05/2013)

 Permanent link
  • HARRISBURG, Pa. (7/5/13)--John Finley, longtime board member of  Philadelphia-based Police & Fire FCU, died Sunday at age 85, according to the Pennsylvania Credit Union Association (Life is a Highway July 3).  Finley was a former PCUA board director, serving on the board from 1995 to 2003.  A retired Philadelphia firefighter, he also was a former board member of the Philadelphia Chapter of Credit Unions and served as chapter president from 1993 to 1995. Services were held Wednesday ...
  • LAUREL, Md. (7/5/13)--Cynthia Scott, senior vice president of marketing at Tower FCU in Laurel, Md., died June 13 at the age of 66 after a brief illness.  Scott worked in marketing and sales for most of her 40-year career, serving Tower for the past 13 years. "Cyndy brought tremendous successes to our business with her efforts and leadership," said Martin Breland, president/CEO of Tower FCU. "In fact, she brought new ways of thinking about our business into Tower. She was a valued colleague and friend. She will be sorely missed."  Scott was active in advocacy on Capitol Hill, including participating in the Credit Union National Association Governmental Affairs Conference in Washington, D.C. She also began Tower's financial education program, which was recognized by the National Credit Union Administration, the Treasury Department of Financial Literacy initiative and members of Congress ...

KCUA: Kansas CUs Start 2013 With Strong Growth

 Permanent link
WICHITA, Kan. (7/5/13)--Kansas credit unions began 2013 with strong growth in assets, shares, capital and loans, according to the Kansas Credit Union Association, in another indication of the value that credit unions bring to members.
 
Loans balances rose by 5.8%, which was "outstanding," said KCUA. That compares with nationwide loan balance growth of 4.8%. The average member relationship--the outstanding combined loan and share balances per member, excluding member business loans--increased to $12,428 in March.
 
"Our state credit unions continue to faithfully serve the 630,000 Kansas consumers who are credit union members," said Tammy Wendland, consultant for KCUA. She noted that the People Helping People philosophy "is evident by the increased member relationship numbers, as people continue to see the value of credit unions and how credit unions can help them reach their financial goals."
 
Share balances rose at a 6% rate, outpacing the 5.1% national average, with only share certificates decreasing.
 
KCUA said asset quality is still a high point for credit unions in the state, despite a slight increase in delinquency. Even with the increase, credit unions are still below the national delinquency average of 1.02%.
 
Capital levels remained high--at 11.3% of assets, better than commercial banks, as well as credit unions and banks overall nationwide.
 
Membership rose by 5,300 people during the past year, with Kansas credit unions now serving more than 630,000 members, said KCUA.

CUs Highlighted in Amtrak's 'Arrive' Magazine

 Permanent link
WASHINGTON (7/5/13)--Tucked into the seat-back pockets of its trains going from Washington, D.C. to Boston, Mass.--via New York City--and back, the current Amtrak and Amtrak Acela magazine features an article advising passengers on "Choosing the Right Financial Guru."  The first tip of the six offered shines the spotlight on credit unions.
 
"When it comes to financial advice, there is no one-size fits all expert," the Arrive article says. "Loan officers at the local credit unions offer mortgage services, financial planners make recommendations for investments and retirement accounts, credit counselors establish debt repayment programs, and financial psychologists delve into beliefs about money."
 
The article highlights: "As nonprofit organizations, credit unions have lower operating costs than big banks, and that can translate to better deals for members" like higher rates on savings and lower fees on services and lower rates on loans than banks.
 
The article notes that most people are eligible to join a credit union and notes the Credit Union National Associations consumer website, aSmarterchoice.org, as a way to find the right match. CUNA worked with Arrive on the article.

Global Women's Network Scholarship Winners Announced

 Permanent link
MADISON, Wis. (7/3/13)--
Click to view larger image Seventy women from around the globe met at last year's Global Women's Leadership Forum in Gdansk, Poland. Nearly 100 women, including seven scholarship winners, will attend this year's event in Ottawa, Canada. (Photos provided by the World Council of Credit Unions)
Seven women from Canada, Kenya, Macedonia, Malawi and Thailand will join nearly 100 women from 11 countries for the fifth annual Global Women's Leadership Forum in Ottawa, Canada, thanks to scholarships from two credit unions and a service provider.
 
The scholarships are from Lake Trust CU,  Brighton, Mich.; Numerica CU, Spokane Valley, Wash.; and The Members Group (TMG) in Iowa.
 
The annual forum will be held in conjunction with World Council of Credit Unions' World Credit Union Conference at the Ottawa Convention Center July 14-17.
 
Recipients of the 2013 Global Women's Leadership Network scholarship recipients are:
  • Lisa Marie Bonin, corporate procurement specialist, Servus CU, Canada;
  • Kruewan Chonlanai, manager, Central Finance Facility Department, Credit Union League of Thailand Ltd.;
  • Barbara Gascoigne, general manager, Jamaica Teachers' Association Cooperative Credit Union Ltd.;
  • Jelangat Irene, SACCO operations manager, Belgut Rural Women SACCO, Kenya;
  • Triza Tsiga Magreta, general manager, Mudi SACCO, Malawi;
  • Cheryl Rettschlag, manager, Banking Support Services, Servus CU, Canada; and
  • Eleonora Zgonjanin Petrovikj, CEO, FULM Savings House, Macedonia.
They will receive varying levels of support to participate in the forum as well as a one-year network membership. TMG also sponsored an additional scholarship for Elenita San Rogue, CEO, Association of Asian Confederation of Credit Unions.

In honor of former Entrust Financial CU CEO Susan Adams, who died April 8 after a battle with cancer, Phoenix-based Arizona State CU, established the Susan Adams Scholarship Fund to support women from developing countries through their participation in the Global Women's Leadership Network. The scholarship will offset membership dues and costs associated with the network's annual forum for the next three years, said World Council. Entrust is based in Richmond, Va.

"Susan supported initiatives that were all about making life better for those in need," said David Doss, Arizona State CU president/CEO, who served with Adams on the PSCU board of directors. "As a woman in the industry, she cared about the opportunity that she could provide as a mentor and leader to others."  He noted that Adams and her husband, who retired last year, served the credit union industry for more than 30 years.

Attendees of the 2013 Global Women's Leadership Forum will hear from Sheryl WuDunn, the first Asian-American Pulitzer Prize winner and co-author of New York Times bestseller Half the Sky: Turning Oppression into Opportunity for Women Worldwide. The book inspired a PBS television series and international women's rights movement, said World Council. She will present research from her book and participate in a panel discussion about economic empowerment.

Arizona State CU Sets Up Fund For Fallen Firefighters

 Permanent link
PHOENIX (7/3/13)--"Stunning" was how an Arizona State CU executive described the loss of six members and one former member who died while battling the Yarnell Hill Blaze in Arizona. The credit union is accepting donations to support the families impacted by the loss of the Granit Mountain Hotshots Crew from Prescott, Ariz.
 
The credit union will match up to $20,000 of direct contributions, and will recognize donors by name on its website.
 
The firefighters were employed by the city of Prescott, which is among the select employee groups served by Arizona State CU, based in Phoenix.
 
"There certainly were personal connections with some of these firefighters," said Paul Stull, Arizona State CU senior vice president. "Some people are understandably taking it very hard. There is great concern for the families."
 
The seven firefighters were among 19 who died while battling one of the worst wildfires since 1933. It was the biggest loss of firefighters since 9/11 claimed 343 New York Fire Department personnel (USA Today July 2). The fire was started Friday by lightning.
 
At least 8,400 acres were ablaze on Monday and 200 homes devastated in the towns of Glen Isla and Yarnell,  30 miles south of Prescott and about 85 miles southwest of Phoenix
 
Arizona State CU is prepared to assist members affected by the fire. The credit union will offer a 90-extension on loan payments, waive early withdrawal fees certificates of deposits, and provide emergency loans at a low-interest rates, Stull said.
 
In the immediate term, contacting displaced members who have been cut off from regular Internet access is difficult, Stull said. The local post office has set up postal service for displaced residents in a nearby town and the credit union has sent letters to members offering assistance.
 
"As far as those who may have lost their homes, we'll work with them on any insurance needs or anything else we can do to streamline that process to either to get them back into housing or settle the issues they have with any damage or destruction they suffered," Stull said.

NEW: CUs Should Take Action To De-risk Social Media, Expert Tells ACUC

 Permanent link
NEW YORK (7/3/13 UPDATED: 12:30 p.m. ET)--Credit unions should implement policies and procedures to protect themselves against possible liability related to their use and their employees' use of social media, said attorney Kevin Funnell of Bieging Shapiro & Barber LLP,  at a Discovery Breakout Session  during the 2013 America's Credit Union Conference today.
 
The Credit Union National Association's ACUC ends today in New York City. The Discovery session was sponsored by CUNA Mutual Group.
 
A recent survey indicated that 62% of U.S financial institutions were not using social media or had no immediate plans to use it because they were worried about compliance, Funnell said.  "Most Americans are involved in social media," Funnell said. "There are 157 million Facebook users already, and 47% of adults use social media."
 
Also, new media present risks that traditional media don't--primarily a lack of control over content and a heightened sense of risk, Funnell added. "Social media is relatively new, and there are some well-settled legal rules, but not for financial institutions," he explained. "It's an open forum and there is a world full of possible plaintiffs and the fear of the unknown."
 
Some legal risks when a financial institution markets to a member/customer through social media  include: 
  • Deceptive advertising;
  • Intellectual property infringement/plagiarism;
  • Defamation/trade libel;
  • Disclosure of trade secrets or private information; and
  • Is it a conversation or advertising?
Legal risks when an employee uses a financial institution's social media include:
  • Leaking confidential information;
  • Committing defamation;
  • Admissions against the financial institution's interest;
  • Binding the financial institution to a promise;
  • Legal and regulatory violations;
  • Inability to regulate communication; and
  • Reputational risk.
Credit unions and financial institutions need to have clear internal written policies regarding copyright infringement, defamation, trade libel, use of non-public personal information and dishonesty (deceptive trade practices). "The key is to enforce policies consistently" to avoid any legal problems regarding unfairness of their application, Funnell said.

He concluded with social media policy takeaways for financial institutions. They are:
  • Strike a balance between the specific and the general.
  • Be aware that National Labor Relations Board rules apply--even without a labor union.
  • Understand that informed managers are the key.
  • Realize the NLRB has been making aggressive interpretations (in favor of employees).
  • Review Individual policies and procedures.
If you missed coverage of the ACUC, visit News Now and Credit Union Magazine. Follow today's coverage also on Twitter and LinkedIn by using the links below.

ACUC Debate: Indirect Lending--Yea Or Nay?

 Permanent link
NEW YORK  (7/3/13)--Do credit unions do a disservice to members via indirect lending? Or is this practice a powerful tool that allows members to obtain loans when and where they want?
 
That was the "great debate" Monday afternoon at the America's Credit Union Conference between two credit union lenders: Dawn Wade-Brummett, vice president of retail lending and operations for ORNL FCU, Oakridge, Tenn., and Jim Holt, CEO of MidAmerican CU, Wichita, Kan.
 
David Polet, CUNA Mutual Group's director, voice of customer, moderated the discussion at the conference presented by the Credit Union National Association.  He polled the audience on its views of indirect lending: 58% of those polled believe it's a member-focused service, while roughly 30% disagreed somewhat with that statement.
 
"We must get past the stereotype of the shady dealer," said Wade-Brummett, an indirect lending proponent. She says reputable dealers often get lumped in with those that are irresponsible--similar to how credit unions sometimes are unfairly equated with banks.
 
"Indirect lending is about empowering members to get loans when and where they need them," Wade-Brummett said. "Credit unions should do due diligence with dealers like they do with all vendors--and they should never give control of underwriting."
 
Holt, meanwhile, applauded the 30% of session attendees who "had not gone over to the dark side" by working with auto dealers. "It's not good to send members into a high-pressure situation where they will be sold high-priced products.
 
"And do we want the people the dealers send us?" he continued. "Less than 20% of these people even qualify for other services."
 
Wade-Brummett offered a firm "yes" to that question. "We want these members, and every credit union should. These people live in your community. They may not fit your model, but credit unions need to extend services to those who need them. Let's introduce ourselves to them."
 
That's fine, Holt said, "but I don't want the first contact a member has with us to be a sales guy at a dealership. I want that to be with my employees, who've been properly trained and coached. We have trained loan officers who can fit them into the right deal--and maybe change their mind from buying a Cadillac to a Taurus."
 
The conference, presented by the Credit Union National Association, ends today. Be sure to visit News Now and Credit Union Magazine to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: CU Branches Evolving To Meet Members' Needs

 Permanent link
NEW YORK (7/3/13)--U.S. credit unions are changing the design and function of credit union branches to meet the evolving needs of members, said a panel discussion at a CUNA Mutual Group Discovery Breakout Session, "Branches of the 'Future' are Here Today," Tuesday at the 2013 America's Credit Union Conference.
 
The ACUC, presented by the Credit Union National Association in New York City, runs through today.
 
Raja Bose, senior director, consumer transaction services at Diebold and the moderator for the panel, said there are five factors driving change in the credit union marketplace.
 
They are:
  • Exponential change in technology, with consumers rapidly adopting new technology and expecting more from credit unions;
  • The rise of consumer power, with empowered consumers driven by social media;
  • Transformational technology;
  • Changing demographics; and
  • The new normal--lower profits for financial institutions because of the rise of retail financial services.
"Consumers want to feel like they are in control, and they don't feel they are getting this today," Bose said. Strategies for credit unions include driving efficiencies, mitigating risks, enhancing member experience and increasing sales.
 
Four credit unions talked about some changes they've made to branches to elevate staff efficiency, reduce costs and improve member service:

They are:
 
  • Coastal CU in Raleigh, N.C., which has implemented personal teller machines (PTMs), a video-based technology that does everything a traditional teller would do--dispense cash, create images of checks and answer questions, said Willard Ross, Coastal senior vice president and chief retail officer. This is not self-service, but rather personalized service provided by staff at an offsite call center. The benefits include low-cost extended hours of operation, consistently faster and better service (average wait time 20 to 30 seconds), and lower teller turnover in a safer, more focused, better managed work environment.
  • Generations FCU in San Antonio, Texas, which has moved to in-store branches that helped it transition its staffing model to be more nimble and cross-functional because fewer employees no longer are stuck in separated employment silos, said Bonnie Garcia, Generations assistant vice president of business development. "Tellers can now do everything from A to Z," she said, because there are fewer employees and a smaller footprint at the in-store branches.
  • Five County CU in Bath, Maine, which has eight branches--five with in-store locations, one traditional branch and  two full-service "video branches"  that feature PTMs and "smart offices," said  Michael Foley, Five County vice president of sales and business development. The smart offices have the equipment and capability (such as sharing computer screens) to help members go online and also to help them set up to have online bill pay. Five County also has a full-service call center staffed with 18 employees.
  • Pennsylvania State Employees CU (PSECU) in Harrisburg, Pa., which implemented e-centers on 12 different college campuses in the state that serve 400,000 students, said Greg Smith, PSECU president/CEO. Each e-center is 200-300 square feet, staffed with one manager and student intern. The focus on college students is to sustain lending operations and take advantage of the marketing "sweet spot" they are in because the impact of major life events ahead of them equates to credit needs, Smith said.
Visit News Now and Credit Union Magazine to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.
 
 

 

 


ACUC: CUs Can Win Battle For Members' Wallets

 Permanent link
NEW YORK (7/3/13)--While the competition for consumers' wallets is more intense than ever, credit unions can leverage their knowledge of members to outflank their bigger rivals, a CUNA Mutual Group executive told attendees during an America's Credit Union Conference session Tuesday.
 
Click to view larger image Credit unions can use readily available member data to gain an edge on their competitors, John Lass, CUNA Mutual Group senior vice president of strategy and business development, said during the America's Credit Union Conference Tuesday. (Photo provided by CUNA Mutual Group)
The conference, presented by the Credit Union National Association, ends today.
 
"The battle for the American consumer is crowded with competitors--card companies, telecoms, retailers, financial institutions and platform players, to name a few," said John Lass, CUNA Mutual Group senior vice president of strategy and business development. "Technology and the ease with which new players enter the game of winning consumers' business will require credit unions to respond, or be left in the wake," Lass told attendees Tuesday.
 
Financial institutions and retailers have their cross-hairs on members' savings, lending, investments and insurance business because new technology has changed the delivery of financial services to consumers, Lass said.
 
The common battle cry in the quest for those businesses--and payment systems--is customer centricity, and key to that is what's referred to as "big data," he said. Financial institutions and retailers, including credit unions, all have knowledge about their consumers, be it attitudes and behaviors, to determine where they shop, call or search.
 
"Data have become a real asset," Lass said. "Leveraging data is the key to knowing your members' needs and having the ability to deliver the right products and services to the right person at the right time." Data come in many varieties: Account balances, browsing data, social media, email and transactions, to name a few. "Harnessing that data is a key to customer centricity," Lass added.
 
Lass cited actions credit unions can take to win the battle for their members' wallets:
  • Implement a data strategy--Credit unions may not realize it but they have a lot of information on their members, and now is the time to use it in a member-friendly way that keeps their best interests in mind.
  • Segment the member population--Determine which segments resonate with the credit union's value proposition, and segment members based on needs, attitudes and behaviors.
  • Predict member needs--Once a credit union obtains data, it must use the information intelligently. For instance, a new homeowner needs a lawnmower; a new parent needs life insurance.
  • Adhere to a sustainable financial model--Understand the lifetime value of members. They are not only profitable, they will deliver value.
  • Deliver service excellence--Credit unions' staple differentiator is great service. Stay the course on that, but be ready to adapt to changing needs.
  • Enliven member democratic control--Shine a brighter light on their cooperative structural difference. Remind members they are the owners and their credit union doesn't have shareholder issues like most competitors.
  • Don't forget about product and price--Offer relevant products that are comparatively affordable. Most credit unions don't have scale to be a product leader but through their cooperative structure they should work together to be competitive on products and pricing.
Convergence around savings, lending, investments and insurance has intensified as new technology has changed the delivery of financial services to the consumer. The battle is most intense in the area of payment systems. Lass identified key competitors and their new marketing strategies. The cooperative member centricity value proposition will be vital to survive and thrive in the midst of this dynamic competition, he added.
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.
 

ACUC: Heward Challenges CUs To Open Doors To Creativity

 Permanent link
NEW YORK (7/3/13)--Be more creative. Lyn Heward issued this challenge to credit unions during Tuesday's general session at the America's Credit Union Conference in New York City.
 
Everyone has a wellspring of creativity, said Lyn Heward, director of creation for the Montreal Cirque du Soleil and author of "The Spark: Igniting the Creative Fire that Lives Within Us All," during Tuesday morning's general session at the Credit Union National Association's America's Credit Union Conference in New York City. "We just need to tap into and exercise it," she told attendees. (CUNA Photo)
The director of creation for the Montreal Cirque du Soleil and author of "The Spark: Igniting the Creative Fire that Lives Within Us All" says everyone has a wellspring of creativity. "We just need to tap into and exercise it," she told attendees.
 
The conference, presented by the Credit Union National Association, ends today.
 
Heward said credit union leaders can tap into their organizations' creativity by opening these "creative doors":
  • Develop intuitive instincts by finely honing your senses. Move beyond mechanics and analytics and into the moment, she advised. Capture new ideas and experiences as they occur.
  • Partake in "treasure hunting" and "creative transference"--a.k.a. training. Cirque is a treasure hunter, Heward said, "seeking out the most precious of pearls" to work for the organization. The company has created a database of potential employees and holds rigorous tryouts that push people to their limits. "The qualities we seek are courage, the willingness to take risks and to manage their own growth, generosity, and the ability to learn quickly," Heward said. "We peel back the skin to get to the sweet core."
  • Provide a nurturing environment and collaborate. This promotes personal growth and fosters trust. Cirque subscribes to the idea of "collective creativity," whereby everyone is responsible for contributing to the creative process and being generous. "We instill humility," Heward said. "It's not my show, it's our show. Sometimes you have only half of the pieces to the creative puzzle--rarely the whole puzzle. That's why collaborative creativity is so important."
  • Embrace budgetary and other constraints. They force you to be more creative.
  • Take risks. "Forge ahead, make mistakes, and learn from them," Heward advised. "At Cirque we call this 'research and development.' Complacency is the biggest risk you face."
  • Keep things fresh. "Once the baby is born," Heward said, "how can we help it grow?"
The best way to do so is to lead by example. "A hard working boss is top motivator for employees. We need shared creative ownership."
 
Be sure to visit News Now and Credit Union Magazine frequently to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Polet Tells How To Turn Insights Into Biz Success

 Permanent link
NEW YORK (7/3/13)--Credit union marketing decisions are often based on assumptions rather than facts, David Polet, director of CUNA Mutual Group's Voice of Customer division, told attendees of America's Credit Union Conference (ACUC) Tuesday.
 
Click to view larger image Credit union marketers must challenge their assumptions when making decisions, David Polet, director of CUNA Mutual Group's Voice of Customer division, told America's Credit Union Conference Tuesday. (Photo provided by CUNA Mutual Group)
"According to our research, 88% of credit union members have relationships with other financial institutions and that means, for at least part of how members think about finances, credit unions are not the preferred option," Polet said in his Discovery breakout session, "Turning Today's Consumer Insights into Tomorrow's Business Success." Polet was citing CUNA Mutual Group's 2011 Consumer Financial Needs Research.
 
The conference, presented by the Credit Union National Association, ends today.
 
Many credit union marketers assume Gen Y members are not smart with their money and that they don't think about retirement savings, Polet said. A recent CUNA Mutual Group survey shown to the ACUC audience contradicted those assumptions. It found:
  • 60% of Gen Y members are saving for college for their children; and
  • 71% of Gen Y members began planning for retirement before they were 26 years old.
"It's time to challenge all of those assumptions (about) members because we can't keep making marketing decisions based on prejudices," said Polet. "There are a lot of pressures on credit unions to gain market share, and research shows if credit unions aren't out in front of members to showcase what you have to offer, they will look elsewhere."
 
The shift in consumer channel preferences for finding financial products has gone from call center-focused to almost exclusively online. Polet referenced new research from the 2013 Insurance Barometer Study:
  • 86% of consumers use the internet as part of their life insurance purchases; and
  • 33% of consumers work through a call center/local agent for insurance purchases.
"When planning strategies, credit union marketers need to ask themselves, 'Why would my members or potential members get a loan from us? What do I have to offer that's meaningful to them?'" Polet said.
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

CUNA Closed On Holiday, No News Now On Thursday

 Permanent link
WASHINGTON and MADISON, Wis. (7/3/13)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Thursday in observance of Independence Day.
 
News Now will not publish an issue Thursday but will resume regular publication on Friday.

ACUC: Use Social Media To Reach Goals, Says CUNA Chair Wesenberg

 Permanent link

NEW YORK (7/3/13)--Social media can be the catalyst in activating and rallying millions of Americans to help credit unions achieve their goals, Pat Wesenberg, board chair for the Credit  Union National Association and president/CEO of Central City CU in  Marshfield, Wis., told attendees at the 2013 America's Credit Union Conference (ACUC) this morning.
 
CUNA's ACUC in New York City ends today.
 

Click for slide show Social media can be the catalyst in activating and rallying millions of Americans to help credit unions achieve their goals, Credit Union National Association Board Chair Pat Wesenberg tells her audience Tuesday at the Credit Union National Association's America's Credit Union Conference (ACUC). "With our emphasis on people power--which is growing every day, as our recent membership growth shows--the use of social media is right in our wheelhouse." (CUNA Photo)

"Frankly, with our emphasis on people power--which is growing every day, as our recent membership growth shows--the use of social media is right in our wheelhouse," Wesenberg said.
 
Kristen Christian's Bank Transfer Day efforts, spawned through social media, helped add more than two million members since mid-year 2011 through the end of last year, she added.
 
Facebook still remains the social media behemoth--with more than 1.1 billion users worldwide, Wesenberg explained. Nearly 50% of Facebook users 18-to-34 years-old check their Facebook page when they wake up in the morning. And 28% of these young Facebook users check their Facebook page before they even get out of bed, she added.
 
"The point, I think, is clear: Social media is engrained around the world and here at home as the communications medium of choice for millions and millions," said Wesenberg.
 
Social media can perform a strong role in CUNA's Unite for Good program and Don't Tax My Credit Union Initiative, Wesenberg noted.
 
Twitter, the messaging service with its limit of 140 characters per message or "tweet," has emerged as a social media communications powerhouse, Wesenberg said. Today, Twitter counts more than 135,000 new users signing up every day. And the total number of active, registered Twitter users of more than 554 million average 58 million tweets every day.
 
"We also know, the vast majority of our members--especially our most loyal members, more than 40 million who consider a credit union their 'primary financial institution'--will stand with us," Wesenberg said. "All we need to do is activate them. Because, if we use social media the right way today, it can become for us the most effective way for rallying our members.
 
"We want more people--50 million or more--to know the power of belonging to a credit union, by embracing their credit union as the primary financial institution," she added. "That's one of the key goals of our shared strategic vision: 'Americans choose credit unions as their best financial partner.' We're working toward that throughout the Unite for Good  program."
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Brace Yourself For CFPB Lending Changes

 Permanent link
NEW YORK (7/3/13)--Credit unions must act now to prepare for rapidly approaching compliance dates mandated by the Consumer Financial Protection Bureau, CUNA Mutual Group's Regulatory Compliance Manager Lauren Capitini told an America's Credit Union Conference (ACUC) breakout session audience Tuesday.
 
Click to view larger image The Consumer Financial Protection Bureau is moving ahead with new rules that have an enormous impact on credit unions' day-to-day activities, CUNA Mutual Group's Regulatory Compliance Manager Lauren Capitini told an America's Credit Union Conference (ACUC) breakout session audience Tuesday. (Photo provided by CUNA Mutual Group)
The conference, presented by the Credit Union National Association, ends today.
 
Capitini explained how the CFPB is moving ahead with new rules that have an enormous impact on credit unions' day-to-day activities.
 
"In the long run, you will be better served investing time, money and energy into compliance now," said Capitini. "Understand how your credit union needs to adapt to meet the CFPB's new rules, and then develop a strategic plan to implement these changes, which will include changes to the way you do business, your documents, and policies and procedures."
 
New remittance transfer rules have a mandatory compliance date of Oct. 28, and five of the CFPB's seven new mortgage compliance rules have January effective dates:
  • Ability-to-Repay, effective Jan. 10;
  • High-Cost Loans & Homeownership Counseling, effective Jan. 10;
  • Mortgage Loan Originator Compensation, effective Jan. 10;
  • Mortgage Servicing; effective Jan. 10; and
  • Reg B Appraisals and Higher-Priced Mortgage Loan Appraisals, effective Jan. 18.
"Stay focused, take time to understand the changes, and make adjustments where necessary," Capitini said. "Doing these things, combined with a positive outlook and understanding what you can control, will do more for your credit union than focusing on the pains of change."
 
Capitini wrapped up the session by giving attendees a glimpse of what's on her radar for regulatory compliance, including payday lending, overdraft protection, and the changes to Reg CC.
 
"Keep in mind, the CFPB is not done yet," Capitini said. "Looking at what the CFPB plans to accomplish in the next couple of years is daunting, but you have the tools to succeed as long as you start adapting now."
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

CU System Briefs (07/02/2013)

 Permanent link
  • LIVONIA, Mich. (7/2/13)--The merger of CUcorp into CU Solutions Group became official Monday, said the Michigan Credit Union League. The boards of the three entities announced in May that they had approved the merger (News Now May 8). CUcorp, a wholly owned subsidiary of the league, focused on serving Michigan credit unions with card solutions, lending products and consulting and partner relations. CU Solutions Group is a combination of CU Village, HRN, CUTS and Koker Goodwin that offers solutions in marketing, technology, membership enhancements and performance management. League President David Adams will continue as CEO of the league and CU Solutions Group. Drew Egan, previously president and chief operations officer at CUcorp, will stay on as executive vice president and COO of CU Solutions Group ...
  • DOVER, Del. (7/2/13)--Dover, Del.-based Del-One FCU has wrapped a 40-foot long DART Inter County Coach bus with pro-credit union messages. The bus stops include Wilmington, the Christiana Mall area, Odessa, Middletown, Smyrna and Dover, as well as breach routes during the summer months, said the Delaware Credit Union League (Together June 30). One side of the bus says "Del-One Federal Credit Union Experience the Credit Union Difference." The other side says "The One Way to a Better Life." "This is yet another way that Del-One plans to increase awareness of the credit union difference throughout Delaware," said CEO Dion Williams.  (Photo provided by the Delaware Credit Union League) ...
  • READING, Pa. (7/2/13)--CTCE FCU CEO Glenn Potteiger and Chief Financial Officer (CFO) Jerry Winchester retired on Sunday, announced Dieter Czerny, chair of the board. Both Potteiger and Winchester have given 24 years of service to the Reading, Pa.-based credit union. Cordy Kemmerer has been promoted to CEO, Patricia Shermot is now chief operations officer, and Kevin Wigoda is CFO. Collectively the new leaders total 57 years of experience with the $78 million asset credit union ...

NEW From ACUC: Indirect Lending--Yea Or Nay?

 Permanent link
NEW YORK  (7/2/13 UPDATED: 10:22 a.m. ET)--Do credit unions do a disservice to members via indirect lending? Or is this practice a powerful tool that allows members to obtain loans when and where they want?
 
That was the "great debate" Monday afternoon at the America's Credit Union Conference between two credit union lenders: Dawn Wade-Brummett, vice president of retail lending and operations for ORNL FCU, Oakridge, Tenn., and Jim Holt, CEO of MidAmerican CU, Wichita, Kan.
 
David Polet, CUNA Mutual Group's director, voice of customer, moderated the discussion. He polled the audience on its views of indirect lending: 58% of those polled believe it's a member-focused service, while roughly 30% disagreed somewhat with that statement.
 
"We must get past the stereotype of the shady dealer," said Wade-Brummett, an indirect lending proponent. She says reputable dealers often get lumped in with those that are irresponsible--similar to how credit unions sometimes are unfairly equated with banks.
 
"Indirect lending is about empowering members to get loans when and where they need them," Wade-Brummett said. "Credit unions should do due diligence with dealers like they do with all vendors--and they should never give control of underwriting."
 
Holt, meanwhile, applauded the 30% of session attendees who "had not gone over to the dark side" by working with auto dealers. "It's not good to send members into a high-pressure situation where they will be sold high-priced products.
 
"And do we want the people the dealers send us?" he continued. "Less than 20% of these people even qualify for other services."
 
Wade-Brummett offered a firm "yes" to that question. "We want these members, and every credit union should. These people live in your community. They may not fit your model, but credit unions need to extend services to those who need them. Let's introduce ourselves to them."
 
That's fine, Holt said, "but I don't want the first contact a member has with us to be a sales guy at a dealership. I want that to be with my employees, who've been properly trained and coached. We have trained loan officers who can fit them into the right deal--and maybe change their mind from buying a Cadillac to a Taurus."
 
The conference, presented by the Credit Union National Association, ends Wednesday. Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

NEW: Use Social Media To Reach Goals, CUNA Chair Wesenberg Tells ACUC

 Permanent link
NEW YORK (7/3/13--UPDATED 12:25 p.m. ET)--Social media can be the catalyst in activating and rallying millions of Americans to help credit unions achieve their goals, Pat Wesenberg, board chair for the Credit  Union National Association and president/CEO of Central City CU in  Marshfield, Wis., told attendees at the 2013 America's Credit Union Conference (ACUC) this morning.
 
CUNA's  ACUC  in New York City  runs through Wednesday.
 
"Frankly, with our emphasis on people power--which is growing every day, as our recent membership growth shows--the use of social media is right in our wheelhouse," Wesenberg said.
 
Kristen Christian's Bank Transfer Day efforts, spawned through social media, helped add more than two million members since mid-year 2011 through the end of last year, she added.
 
Facebook still remains the social media behemoth--with more than 1.1 billion users worldwide, Wesenberg explained. Nearly 50% of Facebook users 18-to-34 years-old check their Facebook page when they wake up in the morning. And 28% of these young Facebook users check their Facebook page before they even get out of bed, she added.
 
"The point, I think, is clear: Social media is engrained around the world and here at home as the communications medium of choice for millions and millions," said Wesenberg.
 
Social media can perform a strong role in CUNA's Unite for Good program and Don't Tax My Credit Union Initiative, Wesenberg noted.
 
"We also know, the vast majority of our members--especially our most loyal members, more than 40 million who consider a credit union their 'primary financial institution'--will stand with us," Wesenberg said. "All we need to do is activate them. Because, if we use social media the right way today, it can become for us the most effective way for rallying our members."
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

Louisiana League Equips CUs With Fin Counseling Know-how

 Permanent link
HARAHAN, La., and MADISON, Wis. (7/2/13)--Credit unions in Louisiana have embarked on a new program that promises to give members another benefit through credit union membership through access to certified financial counselors.
 
Click to view larger image Louisiana credit unions participate in a new blended training program that offers staff affordable training as certified financial counselors. The Louisiana Credit Union League teamed with the National Credit Union Foundation's REAL Solutions Program and the Credit Union National Association's Center for Professional Development for the program. (Photo provided by the National Credit Union Foundation)
Working with the National Credit Union Foundation's REAL Solutions Program and the Credit Union National Association's Center for Professional Development, the Louisiana Credit Union League has continued its affordable training program that kicked off for credit union staff in January with 57 individuals from 22 credit unions and the league participating.
 
The program combines the lower cost and convenience of CUNA's self-study Credit Union Financial Counseling Certification Program (FiCEP) with webinars and local in-person training and networking. Once participants successfully complete the FiCEP training and pass eight proctored exams, they earn the Credit Union Certified Financial Counselor (CCUFC) designation.
 
In June, more than 30 individuals earned their CCUFC designations, and more than 30 are expected to earn the designation in July. Certificates will be presented to individuals during chapter meetings around the state in August and September. The league also plans to offer the program again in January.
 
"We are so encouraged by the tremendous response we've seen to this program from our credit unions, and the students have been so enthusiastic and eager to learn," said Jennifer Green, league vice president. "We believe it will help credit unions make an incredible difference in their members' lives."
 
She noted that "credit unions are in a unique position to provide both education and counseling to members to help them improve their financial future."

ACUC Speaker Gladwell: Bigger Isn't Always Better

 Permanent link
NEW YORK (7/2/13)--Being an underdog isn't such a bad thing after all.  In fact, much of what people consider to be weaknesses turn out to be strengths, best-selling author Malcolm Gladwell told America's Credit Union Conference Monday morning in New York City.

The conference, presented by the Credit Union National Association and attended by more than 1,200, ends Wednesday.
 
"A lot of our intuition about what an advantage is and what a disadvantage is, is wrong," Gladwell said. "Bigger isn't always better and being powerful in a marketplace doesn't ensure future success."
 
That's because large leading companies often innovate less, they're less nimble, and they're further from their customers, he said.
 
Conversely, underdogs often resort to unconventional methods, hard work, and sheer determination to compete with their larger rivals.
 
That's good news for credit unions, which are decided underdogs compared to their banking rivals in terms of resources.
 
Gladwell cited legendary college basketball coach Rick Pitino as a prime example. Pitino is one of the few coaches to use a full-press approach to the game, whereby players contest every inbound pass.
 
Despite his success, including an unlikely Final Four appearance with Providence College, few coaches mirror his approach. Why?
 
"They don't do this because it's hard," Gladwell said. "Playing conventionally is easy. What's different, rare and scarce is effort, not resources.
 
"When looking at innovators who make lasting contributions," he continued, "you see the same traits again and again: they're creative, conscientious, and disagreeable because they feel that they're right."
 
Admitting he's the only member of his family to not be a credit union member, Gladwell urged credit unions to spread the word about how they differ from other financial institutions and the benefits those differences provide.
 

ACUC: Payments Space Is Changing, CUs Need Good Timing

 Permanent link
NEW YORK (7/2/13)--The payments market is rapidly changing, so credit unions need to monitor the market, evaluate payment platforms and channels, and determine where to enter and exit on the product life-cycle curve, said a CUNA  Mutual Group speaker at the 2013 America's Credit Union Conference.
 
The conference, presented by the Credit Union National Association, runs through Wednesday in New York City.

Seventy-five percent of credit union fee income is related to the payments space because products and services related to payments generate revenue, Theran Colwell, CUNA Mutual director, strategy and business development, said in a Discovery Breakout Session sponsored by CUNA Mutual Group.
 
Seventy-five percent of credit union fee income is related to the payments space because products and services related to payments generate revenue, Theran Colwell, CUNA Mutual Group director, strategy & business development, said in a Discovery Breakout Session sponsored by CUNA Mutual at the 2013 America's Credit Union Conference in New York City Monday. (CUNA photo)
"That's what makes this a hot topic," he explained.
 
Payments are the key to being the consumer's preferred financial institution, Colwell said. With payments, there are seven platforms and two channels.
 
The platforms are:
  • Cash;
  • Checking system;
  • Credit card system;
  • Debit card system;
  • Automated clearing house (ACH);
  • Wire transfer system; and
  • Closed-loop systems and virtual currencies (i.e., airline rewards, Starbucks Card).
There are two channels: Electronic (Web, mobile, clearing house ATM) and physical (cash, checks). Payments move in all directions among the platforms and channels, Colwell explained. 
 
One trend in roughly the past 10 years is that check transactions and processing are significantly down, while the number of debit-card transactions, credit-card volume and ACH transactions are up, he added.
 
Notable entrants into the payments market include Starbucks (Starbucks Card), Square (Square Register and Square Wallet), Google (Google Wallet) and Target (RedCard Debit, RedCard Credit), Colwell said.   
 
Starbucks is known as the most successful entrant into the new payments world, with its Starbucks Card processing $2.7 billion per year, with more than 500 million transactions annually.  
 
The future of payments for credit unions is dependent on what members want, technology, regulation, economics and timing, Colwell said. "Timing is critical in payments," he added.
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

CU Loans, Savings Up In May

 Permanent link
MADISON, Wis. (7/2/13)--Savings growth outpaced loan growth at credit unions in May, leading the credit union movement's aggregate loan-to-savings ratio to fall to 67.7% from 68% in April, according to the Credit Union National Association's Monthly Credit Union Estimates.
 
Click to view larger image Click for larger view
Credit union loans grew by 0.5% in May--a 6% annualized rate.  Savings growth outpaced loan growth by a wide margin--though the disparity arose because May ended on a pay day and automatic payroll deposits caused share draft balances to increase dramatically. Savings balances increased by 9% in the month. 
 
"The combination of a slowly improving economy, significant pent-up demand, and seasonally strong borrowing should result in relatively strong loan growth in the coming months," said Mike Schenk, vice president of CUNA's economics and statistics department. "All else equal this should have a positive influence on credit union bottom-line results as short-term, liquid investments yielding close to zero are replaced with higher-yielding assets."
 
Click to view larger image Click for larger view
May's asset quality improved marginally, with dollar delinquencies ending at 1.14%, which compares to 1.17% at the end of April.  The movement's aggregate delinquency rate has remained in the 1.20% to 1.14% range for the past year, though it is substantially improved compared to the year-end 2011 reading of 1.6% and the 1.85% cyclical high recorded in January  2010.  The movement's long-run average aggregate delinquency rate is about 1%.
 
CUNA economists continue to stress the likelihood of slow improvement in economic conditions, with a continuation of slow labor market improvement, marginal income gains and more loan growth.  "This suggests that the improving asset quality trends we've seen will continue in the coming months," Schenk told News Now.  "More important, the improvements are likely to push the aggregate delinquency rate back down near the 1% long-run norm in 2013."
 
Total memberships expanded rapidly--by 0.5% (an annualized 5.5% rate)--during May. "That rate of growth will obviously not be sustained throughout the year, but the data do show credit union memberships are up by 2.5%, compared to year-ago levels and are up 1.5% on a year-to-date basis," Schenk said. "By way of comparison, the U.S. population grows at an annual rate of slightly less than 1%--a clear indication that more consumers continue to recognize the credit union difference and understand that credit unions are the best choice for consumer financial services."
 
From an economic perspective, the U.S. economy continues its slow, unsteady recovery, said CUNA economists.  Further improvement has lately been constrained by big declines in government spending and investment, Federal Reserve policymakers that seem to be sending mixed signals on the potential for quantitative easing (QE3) "calibration" and more cracks evident in overseas economies--particularly in China.
 
Nevertheless, consumers are engaged.  Personal consumption activity has been fueling economic growth and (by extension) labor market improvement.  With the federal funds interest rate expected to remain low through 2014, a robust housing market recovery (with big upside potential) and consumer confidence at its highest level since January 2008 more improvement-- both in the economy and in credit union operating results is expected in the coming months, CUNA economists said.
 
"Looking forward, these macro-developments should translate to marginally faster loan growth, further improvement in asset quality and higher capital cushions at U.S. credit unions in the coming months."
 
CUNA economists said they expect:
  • Credit union savings balances to grow 6% in 2013 and 5% in 2014. Saving growth will remain below the average growth rate over the last 20 years of 6.7% as the economic recovery encourages more households to spend rather than save.  Fast membership growth of approximately 2% (twice as fast as the 1% growth in population) will help buoy savings growth.
  • Credit union loan balances to rise 5.5% in 2013 and 6.5% in 2014. "We expect households to release some pent-up demand for autos, furniture and appliances over the next two years.  New auto loans, credit card loans and purchase mortgage loans will be strong growth areas," said Schenk.
  • Credit quality will improve in 2013 and 2014. The overall loan delinquency rate will fall below 1% in 2013, the lowest level since July 2008, as job growth continues.  Provisions for loan losses as a percent of assets will fall to 0.30 percent in 2013, below the 0.43% recorded in 2007.
  • Credit union return on assets will fall to 0.75% in 2013 and 2014.  A 10 basis point (bp) decline in net interest margins will be only partially offset by a five bps decline in provisions for loan losses.  Fee and other income will decline as the mortgage refinance boom comes to an end in 2013.
  • Capital-to-asset ratios will rise to 10.9% in 2014. Capital growth will outpace asset growth over the next two years, increasing the capital-to-asset ratio.  Credit union capital ratios will approach the record level of 11.5% set in 2006, the year before the beginning of the great recession.

ACUC: Act To Secure Future, Cheney Urges CUs

 Permanent link

NEW YORK (7/2/13)--The time has come for credit unions and their members nationwide to take action to protect credit unions, reduce regulatory burdens and prepare for the future, Bill Cheney, president/CEO of the Credit Union National Association, told attendees in his opening remarks Monday morning at the 2013 America's Credit Union Conference (ACUC).
 

Click for slide show Bill Cheney, president/CEO of the Credit Union National Association, outlined three key initiatives during his opening remarks on Monday at the America's Credit Union Conference: Unite for Good, Don't Tax My Credit Union, and Plan to Win. (CUNA Photo)

The ACUC started Sunday and runs through Wednesday in New York City.
 
"Credit unions have done a tremendous job responding to and recovering from the financial crisis," Cheney said. More than 700,000 net new members have joined U.S. credit unions in the first three months of this year, he noted.
 
Three key initiatives are underway to help credit unions thrive in the future: Unite for Good, Don't Tax My Credit Union, and Plan To Win, Cheney said.
 
The "Don't Tax My Credit Union" national campaign has taken credit unions from defending the tax exemption to advocating for it, Cheney noted. The threat level has increased because Congress is taking a "blank sheet of paper approach" to tax exemptions. "We need to get back on that blank sheet of paper," he added. 
 
Unite for Good seeks to have the whole credit union industry speak with one unified voice to remove barriers, increase awareness and foster service excellence for credit unions in reaching the strategic vision in which "Americans choose credit unions as their best financial partner." "This is a long-term project," Cheney explained.
 
Plan to Win is "a 535-seat strategy" to reach every member of Congress by developing a communication strategy, Cheney said. The plan focuses on local and national media relations, shaping the views of opinion leaders, and using social media to its full capacity in support of advocacy efforts.
 
Plan to Win also continues to work on increasing credit union political activity in terms of political action committee contributions, as well as individual contributions, he said.
 
The three CUNA initiatives are "synergistic," working together to create enhanced effects, Cheney said. 
 
"With your help, we can convince millions and millions of Americans to support credit unions, and millions and millions of Americans to flock to credit unions and make them successful in the future," Cheney concluded.
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

Anti-BofA Sidewalk Chalk Protester Found Not Guilty

 Permanent link
SAN DIEGO (7/2/13)--A jury Monday found a 40-year-old man not guilty of vandalism charges brought for writing protest messages in sidewalk chalk in front of three Bank of America branches in San Diego.
 
Jeff Olson had been charged with 13 counts of vandalism by City Attorney Jan Goldsmith for writing statements including "No thanks big banks" and "Shame on Bank of America" on the sidewalk outside a BofA location between February and August 2012 (Fox 5 San Diego).
 
Olson, a Bank Transfer Day proponent and a member of California Coast CU in San Diego, faced 13 years in jail and a $13,000 fine if convicted of the charges.
 
Olson's attorney Tom Tosdal said vandalism law requires that jurors find something was "maliciously defaced," but Olson's purpose was to inform, Tosdal said.
 
Several news reports indicate that BofA officials pressured local authorities for months to arrest Olson. They reported several e-mails from one BofA official asking for progress on the case. That official had allegedly confronted Olson and another man in front of a BofA branch, accusing them of running a business outside the bank (News Now June 27).
 
Olson told media he carried a homemade sign promoting Bank Transfer Day outside one branch but decided his time would be better spent at the banks, trying to convince people to ditch their banks for local credit unions. He noted that was the best way to hold executives and corporations accountable for the financial crisis.

CUs, State Regulator Meet On 'Reasonable Director Compensation'

 Permanent link
FEDERAL WAY, Wash. (7/2/13)--Washington state credit union movement leaders and consultants met June 20 with the Washington Department of Financial Institutions (DFI) to begin discussions on how "reasonable" credit union director compensation will be defined.
 
It was the first such meeting since the state legislature passed an updated Credit Union Act, which allowed for credit unions to pay board members, said the Northwest Credit Union Association (Anthem Recap June 25). Gov. Jay Inslee signed the measure into law on April 22.
 
The DFI  intends to have board compensation rulemaking completed by the end of the year, with an effective date of Jan. 1, said DFI Director Linda Jekel. She indicated that credit unions could begin compensating board members by July 28, the date the updated law becomes effective, but urged them to wait until DFI issues its proposed rule, CR102.
 
Jekel asked NWCUA to help identify and lead a work group to review Washington's model bylaws, which were last updated in 2001. Washington credit unions interested in helping to review the bylaws can contact John Trull, NWCUA's director of regulatory advocacy.
 
"The right balance between guidance and rulemaking was a significant topic of discussion at the meeting," said Hal Scoggins, principal attorney at Farleigh Wadda Witt. He noted that most participants were "seeming to be in favor of guidance."
 
"Some of the things that guidance may cover are the board nominating process, fair and open elections, verifying election results, and board qualifications," Scoggins reported.
 
NWCUA encouraged credit unions considering board compensation to review guidelines issued by the Internal Revenue Service on what tax-exempt organizations should consider in setting executive compensation.

ACUC: Step Up Your Social Media Game

 Permanent link
NEW YORK (7/2/13)--During the "Step Up Your Social Media Game" session Monday afternoon at America's Credit Union Conference (ACUC) in New York City, two experts shared information on why social media is so powerful, how credit unions are currently using social media and what improvements to make to become more successful.

The message of Jason Milesko, chief impact officer at Filene Research Institute,  and Patrick Rooney, CEO of QUEsocial, was simple. The public isn't responding to basic marketing and advertising campaigns anymore. Instead the public wants to hear--through word of mouth--that the product or company is good, reliable and effective.

The Madison, Wis.-based Filene Research Institute recently conducted a survey on how credit unions are using social media. The conclusion: Credit unions have social media because they understand it is important but aren't utilizing it effectively.
To have a successful social media campaign Milesko and Rooney suggested credit unions:
  • Treat social media like any other business tool;
  • Set clear objectives, strategies and metrics;
  • Define your story and stick to it. What is your credit union story and why are you so unique;
  • Understand the landscape: who is talking, where, and how;
  • Include the three F's--Fun, Fame, Fortune. Entertain your audience, recognize and highlight your followers and give them an incentive;
  • Target and research your audience. Define who you are targeting and research what they are interested in hearing about;
  • Activate employees. Ask them to become your social media ambassadors. It will increase their pride in the organization and allow the credit union to expand its reach through its social media connections.
  • Measure, assess and adjust: Assess what you are doing and if it is working. Social media is constantly changing and requires constant modifications to your strategic plan.
  • Be consistent. Social media is only successful if you cultivate relationships, which is built on being a constant reliable source of information.
"We are only bound by the limits of our creativity. There is so much we can do. The sky is the limit," said Rooney.
Throughout the presentation, Rooney and  Milesko presented multiple examples of successful social media campaigns companies have created showing that social media is an inexpensive yet powerful tool in which to invest.

The conference, presented by the Credit Union National Association, ends Wednesday. Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Cybersecurity Session Outlines Trends

 Permanent link
NEW YORK (7/2/13)--With data breach trends exponentially growing and becoming more frequent, cyber security is a topic that every credit union is being forced to address and take seriously.
 
During Monday's Cybersecurity session at the America's Credit Union Conference, John Mullen Sr. of Nelson Levine de Luca and Hamilton, and Mark Greisiger, president of NetDilligence, reported data breaches jumping from 1,100 in 2004 to 2,600 in 2012.
 
They outlined the main threats from data breaches in two categories, non-malicious and malicious.
 
Non-malicious threats include staff mistakes such as losing a laptop, marketing mishaps, innocent customer data leaks and networking operations. Malicious threats include stealth hackers, rogue contractors or a breach from a planned hack on a system.  Non-malicious are the most common, they said.
 
Common issues with data breaches are decentralized information technology (IT) operations, hacking (SQL injections), the common loss of a laptop with client data, loss of backup tape,, staff mistakes and breaches of vendor and business partners.
 
"I hear all the time from credit unions that they believe they are too small for someone to want to hack into their systems," Mullen said. "What they don't realize is they aren't dealing with Bill Gates sitting in his garage planning and plotting his attack. Hackers use programs which provide information about which systems they will be able to attack successfully."
 
He went on to stress that although protecting the credit union from data breaches and cybersecurity attacks can be very expensive, it is a precaution that is necessary. With the average cost of a breach claim totaling $1 million, it is worth investing in educating the credit union's IT personnel on how to handle and prevent these attacks as well as allowing a third party to double check that the credit union's preventative measures are successful, he concluded.  

CU System Briefs

 Permanent link
  • MADISON, Wis. (7/1/13)--One credit union organization is dropping its contribution to the acronym alphabet soup that can often confuse people in the credit union industry. The World Council of Credit Unions is phasing out the use of "WOCCU" during second references to the global trade association and development agency for credit unions. Instead of WOCCU, it will refer to itself as "World Council." The transition will also come with a new logo, which says "World Council," the association told News Now last week ...
  • BURLINGTON, Vt. (7/1/13)--The former CEO of Burlington, Vt.-based Border Lodge CU, which was shuttered last year, has pleaded not guilty to charges of embezzling several hundred thousand dollars from accounts at the $3.1 million asset credit union. Border Lodge CU was closed in November by the Vermont Department of Financial Regulation, which appointed the National Credit Union Administration as liquidator (sfgate.com June 28, Barre Montpelier Times Argus June 25 and News Now Dec. 3).  Debra Kinney, 58, was indicted by a federal grand jury in Burlington last month. She was the only employee of the Derby Line, Vt.-based credit union. The court documents allege she deposited money from the credit union into her account and a friend's account ...
  • HOUSTON (7/1/13)--Shawn Nelson, 39, former vice president of Members Choice CU in Houston, pleaded guilty Thursday to embezzling $340,000 by using bogus loans in other people's names (Associated Press Newswires June 28). A lending officer at $519.2 million asset credit union from 2001 through 2009, Nelson allegedly opened signature loan accounts in the names of his family and friends and spent the money for personal expenses. He faces up to 30 years in prison and a fine of $1 million, and has agreed to forfeit the $340,000, said Associated Press. He is to be sentenced in the fall ...

Bergeron, Hughes Re-elected To Tricorp Board

 Permanent link
SOUTH PORTLAND, Maine (7/1/13)--Joe Bergeron, president of the Association of Vermont Credit Unions (AVCU), and Brian Hughes, CEO of Holy Rosary CU in Rochester, N.H., were re-elected to the TriCorp FCU board at Tricorp's 38th annual meeting in South Portland, according to AVCU.

Board officers elected were:

  • Chair--Ralph Ferland, EMMC FCU, Bangor, Maine;
  • Vice chair--Katie O'Brien, Casco FCU, Gorham, Maine;
  • Treasurer--Paul Roy, Bellwether Community CU,  Manchester, N.H.; and
  • Secretary--Bergeron (NewsLines Express June 28).
Other directors are: David Desjardins, Acadia FCU, Fort Kent, Maine, and immediate past chair Don Casko, Katahdin FCU, Millinocket, Maine.

In other activities at the meeting, Brian Branch, president of the World Council of Credit Unions, gave a presentation about international credit union CEO development to about  60 leaders representing 28 of the corporate's member organizations assembled for the meeting. 

Branch presented statistics about the world's 53,000 credit unions, and emphasized the story of World Council's work rebuilding the Busia Orphanage in Kenya.

He also spoke about the importance of credit union systems cooperating with each other locally, regionally, nationally and globally to share expertise and ideas. Branch cited the efforts of the Maine Credit Union League and Synergent as examples of successful sharing and collaboration, said the Maine Credit Union League (Weekly Update June 28).

The league, Synergent and Maine credit unions hosted several delegations from the Rwanda credit union movement and the Association of British Credit Unions during the past decade, and shared technology best practices, economies of scale and other ideas to help credit unions in those countries grow.

"Credit unions in the U.S. and Canada are often turned to for leadership in helping credit union movements in other countries get started and to grow stronger, so it is great to see the Maine League, Synergent and Maine credit unions embrace the spirit of cooperation," Branch added.

12 Students Join Googolplex Youth Editorial Board

 Permanent link
MADISON, Wis. (7/1/13)--Twelve students living across the U.S. have been selected to serve one-year terms as youth editorial board members for the Credit Union National Association's microsite called Googolplex: The Credit Union Guide for Student Money Makers.

"We value the feedback and fresh ideas that we receive from our youth editorial board members," says Rena Crispin, Googolplex managing editor. "These bright students help us develop financial literacy tools that speak directly to their peers."

Googolplex is a youth-focused element of CUNA's personal finance microsite suite, which guides credit union members through financial decisions at every stage of life. Googolplex features interactive games, videos, blogs, and other content dealing with money matters and real-life issues to promote financial literacy for youth from age 8 to 18.

Youth editorial board members write critiques of stories and games in age-specific sections of Googolplex's award-winning three-in-one website each month. At the end of their terms, each board member writes an original story for Googolplex.

The Clubhouse Crew for 5-Spot, aimed at elementary school students:

  • Aidan, 9, GECU, El Paso, Texas;
  • Jadam, 10, Star CU, Madison, Wis.; and
  • Kathryn, 9, Clearview FCU, Moon Township, Pa.
The Super Youth Team for AJ's, intended for middle school students:

  • Ember, 12, University of Michigan CU, Ann Arbor, Mich.;
  • Jordan, 11, Hawaii Community FCU, Kailua Kona, Hawaii;
  • Mason, 12, Wood County Community CU, Parkersburg, W. Va.; and
  • Nita, 13, University FCU, Austin, Texas.
The Teenage Panel advising C-Note, focused on high school students:

  • Audra, 14, San Antonio Citizens FCU, San Antonio;
  • Danae, 16, Corporate America Family CU, Elgin, Ill.;
  • Devon, 17, Great Lakes CU, North Chicago, Ill.;
  • Gabrielle, 15, Andrews FCU, Suitland, Md.; and
  • Jaden, 15, EECU, Fort Worth, Texas.
"Our youth board members give us feedback that helps their peers feel welcome and validated whenever they use Googolplex on their credit unions' websites," says Susan Tiffany, CUNA director of consumer periodicals.

To view photos of the new youth board members, learn more about each student, and explore Googolplex, visit 5-Spot, AJ's and C-Note from a subscribing credit union's subscription. Googolplex is just one element of CUNA's personal finance suite. For more online content that benefits credit unions and members, use the link.

News Now, CU Magazine Team Up For Comprehensive ACUC Coverage

 Permanent link
NEW YORK (7/1/13)--The Credit Union National Association's News Now and Credit Union Magazine staffs are teaming up to bring you comprehensive, onsite coverage of the 2013 America's Credit Union Conference (ACUC) now underway in New York City. 

While nothing can replace the value of actually being there, CUNA's coverage will help "take you there" with team reporting by News Now and Credit Union Magazine. Also, CUNAVerse blog postings and a "Twitterfall" at the CUNA exhibit booth to coordinate message delivery will allow conference attendees and those not attending to catch all the action.

Both News Now and Credit Union Magazine websites will feature a cooperative slideshow of keynoters, breakout sessions, and person-on-the-street interviews. Readers also can follow events through Twitter on the News Now LiveWire.

Readers will learn about important issues, such as emerging markets, social media and financial institutions, the branch of the future, and cyber security. CUNA also is arranging some high-profile live events in New York City that will promote the credit union movement as part of Unite for Good. Events include a Wednesday morning visit by attendees to NBC's Today Show to spread the word about credit unions.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

NEW: ACUC: Gladwell: Bigger Isn't Always Better

 Permanent link
NEW YORK (7/1/13 UPDATED 3:15 p.m. ET)--Being an underdog isn't such a bad thing after all.

In fact, much of what people consider to be weaknesses turn out to be strengths, best-selling author Malcolm Gladwell told America's Credit Union Conference Monday morning in New York City. The conference, attended by more than 1,200, ends Wednesday.

"A lot of our intuition about what an advantage is and what a disadvantage is, is wrong," Gladwell said. "Bigger isn't always better and being powerful in a marketplace doesn't ensure future success."

That's because large leading companies often innovate less, they're less nimble, and they're further from their customers, he said.

Conversely, underdogs often resort to unconventional methods, hard work, and sheer determination to compete with their larger rivals.

That's good news for credit unions, which are decided underdogs compared to their banking rivals in terms of resources.

Gladwell cited legendary college basketball coach Rick Pitino as a prime example. Pitino is one of the few coaches to use a full-press approach to the game, whereby players contest every inbound pass.

Despite his success, including an unlikely Final Four appearance with Providence College, few coaches mirror his approach. Why?

"They don't do this because it's hard," Gladwell said. "Playing conventionally is easy. What's different, rare and scarce is effort, not resources.

"When looking at innovators who make lasting contributions," he continued, "you see the same traits again and again: they're creative, conscientious, and disagreeable because they feel that they're right."

Admitting he's the only member of his family to not be a credit union member, Gladwell urged credit unions to spread the word about how they differ from other financial institutions and the benefits those differences provide.

"As humans we see disadvantages that are actually advantages. Sometimes our basic assumptions lead us astray. We need to bring to peoples' attention that bigger isn't necessarily better and small can be a strength. We work harder as a result.

"That's a powerful idea."

NEW: ACUC: CUs Need To Take Action To Secure Future, Cheney says

 Permanent link
NEW YORK (7/1/13 UPDATED: 12:30 p.m. ET)--The time has come for credit unions and their members nationwide to take action to protect credit unions, reduce regulatory burdens and prepare for the future, Bill Cheney, president/CEO of the Credit Union National Association, told attendees this morning in his opening remarks at the 2013 America's Credit Union Conference (ACUC).

The ACUC started Sunday and runs through Wednesday in New York City.

"Credit unions have done a tremendous job responding to and recovering from the financial crisis," Cheney said.

More than 700,000 net new members have joined credit unions in the first three months of this year, he noted.

Three key initiatives are underway to help credit unions thrive in the future: Unite For Good, Don't Tax My Credit Union and Plan To Win, Cheney told 1,200 conference attendees.

The "Don't Tax My Credit Union" national campaign has taken credit unions from defending the tax exemption to advocating for it, Cheney said.

With help from the credit union industry, millions of Americans will support credit unions, flock to them and make them successful in the future, Cheney concluded.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

CUs On Top In New Savings Rate Study

 Permanent link
LOS ANGELES (7/1/13)--A just-released savings rate study comparing credit unions and community banks rates has found that "it is credit unions that do, in fact, come out on top," according to GoBankingRates.com (June 28).

Credit unions offer an average 0.20% annual percentage yield (APY) savings account rate, while local banks provide a slightly lower 0.18% APY, said GoBankingRates.com. Its data averaged rates from 5,000 community banks and credit unions.

In the top 10 credit unions with the highest rates, two credit unions --Pioneer Muslim FCU, Sugar Land, Texas,  and Rutherford Postal District Employees FCU, Lakewood, N.J.--tied for the highest savings rate of 2.52%.  In the banks' Top 10 list, the two top banks--Atlas Bank and Bank of Bolivar--offered 1.01% rates.

All of the top 10 credit unions had rates of 1.25% and above, as of May 31.  The banks' top 10 list rates ranged from 0.85% to 1.01%.

A similar study in April found that the average savings rate at credit unions was 0.21% APY, while banks' rates averaged 0.19% APY.  Big banks in that study averaged 0.04% (News Now April 25).

The study based the rates on online published rate sheets belonging to the financial institutions for a $10,000 opening deposit. For more information, use the link.

ACUC: Cheney, Mellin Help Kick Off 2013 ACUC

 Permanent link

NEW YORK (7/1/13)--Bill Cheney, president/CEO of the Credit Union National Association, and Bill Mellin, president/CEO of the Credit Union Association of New York, helped more than 1,200 attendees kick off the Opening General Session of the 2013 America's Credit Union Conference (ACUC) Sunday evening.

CUNA's ACUC runs through Wednesday in New York City.

Mellin opened the conference by welcoming attendees to New York--the Empire State--and noting New York City has more than eight million residents, welcomes more than 50 million visitors annually, and said that more than one-third of the city's residents were born abroad.

He mentioned the city's ethnic diversity manifested in neighborhoods such as Chinatown and Little Italy, and noted the city has 14,000 taxi cabs and the largest transportation system in the world. "Credit unions finance many taxi medallions [certificates to operate], which have an average value of $750,000," he said.  

There are 98 credit unions in New York City, serving more than one million members, and 412 credit unions in New York State, serving five million people, Mellin noted.

Click for slide showChristina Fernandez-Morrow and her daughter, Ariana, accept Credit Union Magazine's 2013 CU Hero of the Year Award on behalf of their late husband and father, Coopera Founder Warren Morrow. Warren died last year at the age of 34. Joining them are CUNA President/CEO Bill Cheney (left) and Iowa CU League President/CEO Pat Jury.

Cheney presented the Credit Union Magazine CU Hero Award to Christina Fernandez-Morrow, wife of the late Warren Morrow, and daughter, Ariana. Morrow was founder and former CEO of Coopera, the only emerging-markets company in the credit union industry with an exclusive focus on the Hispanic member. (See related News Now story: ACUC:  Morrow Honored As 2013 CU Hero Of The Year.)

The opening session also featured keynoter Lt. Col. Robert Darling, a key adviser to the George W. Bush Administration during the Sept. 11, 2001 terrorist attacks on the U.S. (See related News Now story: ACUC: Darling Shares Front-row View Of History).

Today, Cheney will bring credit unions up to date on the Don't Tax My Credit Union campaign and other critical credit union issues, as well as discuss the movement to Unite for Good, with goals of removing barriers, creating awareness and fostering service to support the vision, "Americans choose credit unions as their best financial partner."

Keynote speaker for today will be Malcolm Gladwell, author of four New York Times bestsellers and New Yorker staffer, who will discuss his new book, "David vs. Goliath." The author has compared credit unions to David and banks to Goliath.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Emerging Financial Markets Are Opportunities For CUs

 Permanent link
NEW YORK (7/1/13)--Low- and moderate-income people who are either underbanked or unbanked, along with a growing U.S. immigrant population, present credit unions with opportunities in emerging markets, attendees were told at a workshop Sunday at the 2013 America's Credit Union Conference (ACUC).

The Credit Union National Association's ACUC, which started Sunday, runs through Wednesday in New York City.

The Emerging Markets Workshop--hosted by Cathie Mahon, president/CEO of the National Federation of Community Development Credit Unions, and Miriam DeDios, CEO of Coopera-- presented the characteristics of the emerging market that create opportunities for credit unions to seize.

Coopera is the only emerging-markets company in the credit union industry with an exclusive focus on the Hispanic member.

Mahon said that 8.2% of U.S. households--or 10 million households--are unbanked. Also, 20.1%--24 million households--are underbanked. Meanwhile, one-fourth of U.S. households tried Alternative Financial Services (AFS) products in the past year, and one in 10 have used two or more ASF products.

"This presents an opportunity for credit unions," Mahon said. "Community development credit unions (CDCUs) have developed tools to identify missed opportunities and develop strategies to better serve their markets."

CDCUs have developed strong partnerships with housing, microenterprises, community-based organizations, local governments and the private sector, she added.

De Dios said emerging markets include underserved/unbanked, low-income, Hispanic and immigrant populations. Growth opportunities should reflect a credit union's membership, increase membership, and increase product and service use, she added.

"Hispanics are the largest, fastest-growing, youngest and most-underserved U.S. market," De Dios said. Hispanic market segmentation and the impact of immigration reform are opportunities and strengths for the credit union industry, she added.

Coopera's mission is to partner with people, businesses and communities for new economic development, she said. Coopera and CUNA are in an alliance to grow Hispanic membership.Coopera is finalizing a Hispanic Growth Return on Investment Study, De Dios said.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Morrow Honored As 2013 CU Hero Of the Year

 Permanent link
NEW YORK (7/1/13)--Warren Morrow--lauded by Iowa Credit Union League President/CEO Patrick Jury as a mission-driven advocate for both consumers and credit unions--was honored posthumously as Credit Union Magazine's 2013 Credit Union Hero of the Year Sunday during the America's Credit Union Conference in New York City.

Morrow founded Coopera, a full-service Hispanic market solutions company, with the belief that Hispanics need credit unions as much as credit unions need Hispanics.

Morrow died Feb. 15, 2012, at the age of 34. His wife, Christina Fernandez-Morrow, and daughter, Ariana, accepted the award on his behalf.

"Warren was one of our strongest credit union advocates," Jury said. "He believed that extending credit union services to the underserved Hispanic community wasn't philanthropy, and he reminded us that credit unions can do well by doing good." Bringing financial stability to peoples' homes, Morrow believed, would help the nation address other societal issues.

Morrow's family moved from Mexico City to Tucson when he was in grade school. While in college, Warren helped form a nonprofit called the Latino Leadership Project, Jury explained. Its mission was to help underprivileged, young Hispanics attend college.

Through his work, Warren realized the base cause he was trying to address was financial instability in the Latino home. In 2011, Morrow told the Des Moines Register, "I came to realize the disparity in education was a symptom of a larger problem. The root issues are the disparities in access to assets [and] wealth, and economic stability in the household."

Credit Union Magazine readers also lauded these leaders as credit union heroes:

  • Lily Newfarmer, CEO of Tarrant County CU in Fort Worth, Texas;
  • Anabela Pereira, CEO of Pioneer Valley FCU, Springfield, Mass.; and
  • Scott Prior, president/CEO of Connection CU in Silverdale, Wash.
"Warren would have been the first to acknowledge these finalists and what they did for credit unions," Jury said.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

ACUC: Darling Shares Front-row View Of History

 Permanent link
NEW YORK (7/1/13)--Lt. Col. Robert Darling shared his front-row view of history Sunday during the America's Credit Union Conference in New York City, detailing the harrowing hours in the "president's bunker" directly after the terrorist attacks of Sept. 11, 2001.

Darling, a decorated Marine Corps helicopter pilot who commanded the presidential fleet, watched the events unfold alongside President George W. Bush, Vice President Dick Cheney, then-National Security Advisor Condoleezza Rice, and other high-ranking government officials--and learned some important leadership lessons along the way.

He took conference attendees through the chaotic aftermath of the deadliest attack on U.S. soil, offering chilling details about the day's events:

  • After the north and south towers of the World Trade Center fell, for instance, the president's leadership team estimated that 40,000 people likely had been killed.
  • Several friendly aircrafts narrowly survived the day unscathed after nearly being shot down by the U.S. Air Force--including a medevac helicopter en route to aid victims at the Pentagon.
  • At one point, "Angel"--the code name for President Bush--was believed to be a prime target.
  • Bush decided to move the country's nuclear weapons from "DEFCON Four" to "DEFCON Two" status--apparently prompting a call from a concerned Russian President Vladimir Putin. The last time the nation stood at DEFCON Two was during the Cuban missile crisis.
  • A false alarm about an imminent attack on the White House caused the Secret Service to sweep the president and first lady away--in their pajamas.
Darling says in times of duress, leaders must:

  • Take bold action. Cheney had no constitutional authority to issue military orders. But he stepped forward to fill a leadership void created by communication issues for Bush and Secretary of Defense Donald Rumsfeld, scrambling fighter jets to pursue a hijacked airplane and protect the president and other perceived targets,. "He got us back on our feet, got us leaning forward again," Darling said.
  • Be decisive. Darling criticized Rumsfeld for actively aiding in relief efforts at the Pentagon after that building was struck by a plane, leaving the military in limbo as it awaited his orders.
  • Be human. Darling saw Cheney shoulder the weight of a difficult decision that put American lives in the balance.
  • Surrender control. High-ranking officials must retain ultimate responsibility, but the difference-makers are the people in the field--such as the first responders on Sept. 11.
"If such a crisis ever comes to the U.S. again, it will be the regular people who respond," Darling said. "We need to give people the tools and training they need to succeed. We can't lead from our comfort zones; we must adapt to the conditions at hand."

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in New York City. You can also follow ACUC on Twitter and LinkedIn by using the links below.

Filene Report On CEOs: Personality Matters More Than Ability

 Permanent link
MADISON, Wis. (7/1/13)--CEOs' personality is more important than CEOs' ability in influencing employee engagement and organization performance, according to a new study from the Filene Research Institute.

The study, "Leading for Credit Union Success: The Roles of Personality and Practices in CEOs," was based on a survey of employees at 84 credit unions across the U.S. and Canada. At each credit union, four senior management team members, four middle managers four entry-level employees and the CEO were surveyed.

Among the report highlights:

  • CEO conscientiousness is the top trait when predicting employee engagement. High scorers in conscientiousness have a strong sense of purpose and urgency that leads them to achieve organizational objectives. While this gets reflected in their leadership behavior, the results show this one trait has a remarkably large effect on overall employee engagement.
  • Emotional stability is the best predictor of organizational performance, while agreeableness is the best personality predictor of CEO leadership. Thus, CEOs who tend to be calm, hardy, secure, and confident (emotionally stable) are linked to more effective leadership and higher organizational performance.
  • Successful CEOs do a better job of maintaining relationships, which is important to transformational leadership. CEOs who tend to be skilled at building and maintaining relationships (relationship competence) are linked to more effective leadership and higher organizational performance.
  • Not all abilities are created equal. The study examined three key CEO abilities: Strategic change competence, the ability to accomplish tasks, and the capacity to build and nurture relationships. Although strategic change competence is the best way to predict a CEO's ability to be a transformative leader, relationship competence is a better indicator of organizational performance.
  • Smarter hiring can make a difference. Credit unions should recognize the importance of these personality traits and abilities when hiring and factor them into the recruiting process, the report said. 
To download the report, use the link.

Oregon Governor Signs CU Act Improvement Bill

 Permanent link
SALEM, Ore. (7/1/13)--Oregon Gov. John Kitzhaber signed legislation this week that updates the Oregon Credit Union Act, as he acted quickly to acknowledge strong legislative support for the bill, said the Northwest Credit Union Association.

NWCUA backed the bill because of recommendations by the Oregon State Model Act Subcommittee, chaired by Scott Burgess, president/CEO of Rivermark Community CU in Beaverton (NWCUA's The Anthem June 27).

"The sub-committee put a tremendous amount of work and analysis into the legislation signed by the governor, and we're very pleased with the outcome," Burgess told NWCUA. "As the chairman of the sub-committee, I know I speak for the group in saying that we're all particularly proud that, in Oregon, we routinely open up the Credit Union Act to seek out legislative changes that will help credit unions better serve their members in these challenging times."

The updated Oregon Credit Union Act will:

  • Broaden Oregon's parity authority by allowing Oregon credit unions to invoke parity with out-of-state credit unions and streamline the process for invoking parity with federally chartered credit unions.
  • Clarify the role of the supervisory committee in governance-related matters.
  • Extend additional liability protection to credit union directors and officers.
  • Remove wording in Oregon law that requires a board to "perform other duties as the members of the credit union from time to time direct and perform or authorize any action not inconsistent with this chapter and not specifically reserved by the bylaws for the members."
  • Remove language in Oregon law that permits a credit union to employ a chief operating officer/president and a security officer.
  • Make the declaring of dividends a power that can be delegated under Oregon law; and increase the loans-to-one-borrower limit to the larger of $100,000 or 15% of a credit union's equity.
The updates will take effect Jan. 1.

HarborOne CU Now a Bank

 Permanent link
BROCKTON, Mass. (7/1/13)--As of today, HarborOne CU in Brockton, Mass., the largest state-chartered credit union in New England, is HarborOne Bank.

The $1.9 billion asset credit union on Wednesday filed an official charter change with the Massachusetts Secretary of State, and said it will be  insured by the Federal Deposit Insurance Corp., effective today (Enterprise and WickedLocal.com June 28).

When HarborOne officials announced last year they planned to pursue a bank charter, they said that converting to a bank would allow it to expand its customer base into Boston; increase lending, especially in business lending; and raise more capital through a stock sale (News Now Dec. 27). Its field of membership is limited to four counties in Southeastern Massachusetts and it could not open a branch in Boston, they said.

Members approved the conversion at a special meeting in March. About 1% of members eligible to vote cast ballots, and of those, 62% voted in favor of the change (News Now April 23). The National Credit Union Administration certified the vote in April.

During the conversion process, the Credit Union National Association and the Massachusetts Credit Union League said they believed a credit union charter is the best option for credit union members, and any decision should be in the members' best interest.

HarborOne Bank has 14 branches and more than 150,000 customers.

Cornerstone CU League Is Now Official

 Permanent link
FARMERS BRANCH, Texas (7/1/13)--The merger of the Arkansas, Oklahoma and Texas credit union leagues becomes official today. An affirmative vote from credit unions in all three states creates the largest credit union league in the nation, according to the league officials.

"These past several years of working together have proven productive and fruitful, which is a good indication of what's to come in this partnership," said Dwayne Ashcraft, former board chairman of the Arkansas Credit Union League and now board member of the Cornerstone Credit Union League (LoneStar Leaguer June 28).

Gina A. Wilson, former chair of the Credit Union Association of Oklahoma and a director for the new league echoed Ashcraft's sentiments.

"The power of collaboration is strong indeed," she said. "I'm confident in our future and look forward to the great things this organization is poised to do for our some 646 credit unions."

The league is based in Dallas, with satellite offices in Little Rock, Ark.; Oklahoma City, Okla.; and Austin, Texas.

Longtime Texas Credit Union League President/ CEO Dick Ensweiler will serve as CEO of the Cornerstone league, with each satellite office having its own president.

"With the combined talent, knowledge and resources of our three states, we are enthusiastic about enhancing member services for our credit unions so they can better serve their members," Ensweiler said.

The board of directors for the Cornerstone Credit Union League is:

  • Chairman--Paul A. Trylko, Amplify FCU, Austin, Texas, Region 2, Asset Category 1;
  • Vice Chair--Kenny Harrington, MemberSource CU, Houston, Region 1, Asset Category 2;
  • Secretary--Michael D. Kloiber, Tinker FCU, Oklahoma City, Okla., Region 4, Asset Category 3;
  • Treasurer--Windy K. Campbell, Electric Cooperatives FCU, Little Rock, Ark., Region 5, Asset Category 1;
  • Dwayne L. Ashcraft, Arkansas Superior FCU, Warren, Ark., Region 5, Asset Category 2;
  • Jason C. Boesch, Oklahoma RE&T Employees CU, Oklahoma City, Okla., Region 4, Asset Category 1;
  • James L. Boyd, Abilene (Texas) Teachers FCU, Region 3, Asset Category 3;
  • Jim Brisendine, Resource One CU, Dallas, Region 6, Asset Category 3;
  • Allen L. Brown, Mil-Way FCU, Texarkana, Ark., Region 5, Asset Category 3;
  • Z. Suzanne Chism, Texas Health Resources CU, Dallas, Region 6, Asset Category 1;
  • Nancy M. Croix-Stroud, First Class American CU, Fort Worth, Texas, Region 3, Asset Category 1;
  • L. Wayne Mansur, Texoma Community CU, Wichita Falls, Texas, Region 6, Asset Category 2;
  • Carol Murray, Express-News FCU, San Antonio, Region 2, Asset Category 1;
  • Robert C. Peterson, One Source FCU, El Paso, Texas, Region 3, Asset Category 2;
  • James S. Tuggle, Transtar FCU, Houston, Region 1, Asset Category 1;
  • JoBetsy Tyler, First Central CU, Waco, Texas, Region 2, Asset Category 2;
  • Gina A. Wilson, Oklahoma Central CU, Tulsa, Okla., Region 4, Asset Category 2; and
  • Paul Withey, Texas Bay Area CU, Houston, Region 2, Asset Category 3.
 

N.C.'s Save To Win Accounts Top $1M In May

 Permanent link
RALEIGH, N.C. (7/1/13)--Save to Win, North Carolina's prize-linked savings program for credit union members, reached several milestones in May. One milestone, total saving, reached more than $1.2 million, said the North Carolina Credit Union League.

Save to Win, North Carolina's prize-linked savings program for credit union members, reached more than $1.2 million in total saving in May. (Photo provided by the North Carolina Credit Union League)
Also, member savings accounts eclipsed 1,500--reaching 1,610 (The Weekly Conversation June 26).

Saving money while winning cash prizes has been popular with North Carolina credit union members, the league said.

Through the first five months of the Save-to-Win campaign, $1,350 in cash prizes were awarded to 147 credit union members.

American Partners FCU (APFCU) in Reidsville, N.C., has had the $500 top monthly prize winner for three consecutive months. The $50 million asset credit union said word of mouth has propelled the program. 

"Save to Win continues to build momentum here at American Partners," Stephanie Chism, APRFCU marketing manager, told the league. "I believe word of mouth by our members is a major reason for the success of this program. Those members who have won prize money want to tell others about it."