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SCMS class focused on building CU activists

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DALLAS (8/18/08)--Southwest CUNA Management School (SCMS) opted to take a different tack with its advocacy class this year. With increasing political and legislative pressure on the credit union movement, the leadership at the SCMS wanted a class that would transform credit union leaders into credit union activists. Advocacy ROCKS! featured practical hands-on exercises for meeting with elected representatives, and hot issues facing credit unions, including the Treasury blueprint, proposed reforms to overdraft and interchange, and other bottom-line credit union issues. The class was developed and led by the Texas Credit Union League's grassroots director, Jim Phelps, and advocacy communications director, Winter Prosapio. "I think a number of my classmates who may not have grasped the importance of advocacy had their eyes opened by the session," said Ben Newcomb, vice president of Transtar FCU in Houston. He noted that this year's SCMS graduates "are both the current and future leaders in the movement, and we must take it upon ourselves to personally get involved politically if this industry is going to continue to thrive. "We can't leave it up to others to form our message. We are the ones living, breathing and working in credit unions every day; therefore, we know our story better than anyone else possibly could," Newcomb added. Instilling a passion for advocacy in the next generation of leaders is a focus for Janine McBee, director of SCMS. "The world credit unions operate in is in flux like never before," noted McBee. "We have to increase the level of engagement in activism of all our credit union leaders. This class is one step toward making that happen." Scott Slattery, assistant vice president for Texas Dow Employees CU, Lake Jackson, found the class hit the mark. "We all know that our credit unions can die due to financial reasons, but if we're not careful, our credit unions can die due to legislative issues as well," he said, adding "It helped me better understand our position on Capitol Hill and gave me a new desire to help our advocates succeed." SCMS is a three-year course study focused on enhancing credit union leadership skills. Students compete to enroll in one of only 50 available slots in each class year. They develop a real-world strategic business plan for their own credit union. For more information, use the resource link.

CEO In tough economy CU marketers must learn numbers

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TEMPE, Ariz. (8/18/08)--"The challenge for any credit union CEO today is trying to maintain balance and aggressiveness, while watching out for potential land mines." So says Michael Poulos, CEO, Michigan First CU, Lathrop Village, Mich., referring to why credit union marketing professionals should learn the credit unions numbers. By learning the numbers that contribute to the bottom line, they can better drive marketing efforts to get results that the CEO and senior management team want. "Without any question, any marketing professional should understand the financial condition of the credit union and all the numbers that go along with it. "Understanding the financial condition of your credit union and being in sync with the financial goals is the foundation for being successful with the senior management team," he said. He noted that the marketing professional also needs to be aware of the issues facing the CEO and senior managers. "My biggest concern is that we might miss out on business opportunities because of what it going on in the economy," Poulos said. "Any business can make money in good times, but only good ones make money in bad times. Being reticent and overcautious are the major concerns I have." He teaches a session on financial ratios and assists students with the financial aspects of a group project during Credit Union Marketing University, which meets in Scottsdale, Ariz., Sept. 22-26.

CU in IFast CompanyI on savings account strategy

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NEW YORK (8/18/08)--A credit union's savings promotion is featured in Fast Company's September issue as part of an article on innovative new programs that make saving fun. The article, "Break the Bank," reports that banks have drawn consumers' ire with their high-interest lending, rising fees and penalties, and that "a range of financial institutions now are trying a new business model: being good." They're nudging and even paying consumers to save money. In breaks down its discussion of savings programs by type of financial institution: banks, online startups, and credit unions. "As community-based nonprofits, credit unions have always promoted saving as part of their mission," the article says. "But with an aging membership, they're going further to attract new customers." The article features Matt Davis, director of public relations at Members CU, Winston-Salem, N.C., and a Filene Research Institute '30 under 30' member. The credit union's What Are You Saving For? program offers "a paltry" 1.8% interest rate, but it includes monthly drawings for additional cash prizes. He got the idea from Peter Tufano, a Harvard Business School professor who has spent a decade studying and testing new policies to promote savings. Tufano was a speaker at a recent 30 Under 30 meeting in Chicago. The article concludes that the something-for-nothing strategy is "where the future of American savings may lie."

Workers on strike at CU over insurance premiums

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LOCKPORT, N.Y. (8/18/08)--Cornerstone Community FCU, based in Lockport, N.Y., has confirmed that more than 70 union employees went on strike Friday, shutting down two branches. At issue is the cost of the health insurance premiums the credit union provides for staff. The union, Office and Professional Employees International Union Local 212, represents 73 of the credit union's 94 employees, Ann M. Brittin, Cornerstone president/CEO, said. It includes all tellers, loan personnel, member service representatives and clerks. In a press release, the $234 million asset credit union said negotiations had been underway since October 2007 to reach a new labor agreement to replace a four-year contract that expired in November. "Cornerstone and Union negotiators reached a tentative agreement, later rejected by Union membership, that would continue to provide employees with a more-than-competitive benefit package, including single and family health insurance coverage for full-time employees and a 401(k) retirement plan," said Brittin. Brittin told News Now that the rejected agreement asked employees to contribute 5% of the monthly health insurance premium, starting in November 2009. The plan also had slightly higher co-pays on physicians' visits and prescriptions, she added. Health insurance costs had risen 53% between 2004 and 2008. The credit union's press release noted New York State Department of Labor statistics indicate the credit union's current average wage rate for its union employees falls above the 90th percentile when compared with wages of employees at other regional and statewide financial institutions. "As a member-owned credit union, we must also maintain a fiscal responsibility to our members as stewards of their assets," she said. The credit union stated that its historical roots and ties to the union concept means it supports the position of a union as representative of its members' best interests. Six of the nine members of Cornerstone's board are affiliated with unions. Until the matter is resolved, the main office in Lockport will continue all functions and regular hours, the credit union said. ATMs are open at its Stevens Street and Middleport branches. Members also were directed to several local shared-service centers the credit union participates in with three other local credit unions for full services. No new negotiations have been scheduled, Brittin told News Now.

Colorado CUs advance their cause during primary

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DENVER (8/18/08)--Although not all of them won, credit union candidates were strongly supported during Tuesday’s primary in Colorado, and credit unions dramatically advanced their cause, according to the Credit Union Association of Colorado (CUAC). “CUAC has gained a stronger voice in the political arena, creating benefits, regardless of the outcome,” said John Dill, CUAC president/CEO. “Even though the results may not be what we wished on election day, our efforts in the election process give us opportunities to work with whoever wins as we are seen as a political player.” CUAC-endorsed candidate Rollie Heath won his bid for state Senate District 16, and endorsed candidate Sean Conway won his bid for Weld County commissioner. Other CUAC-endorsed candidates:
* Joan Fitz-Gerland lost to Jared Polis in the 2nd congressional district; * Jeff Crank was second place in the 5th congressional district to Doug Lamborn. Lamborn reinforced his desire to work with CUAC; * Ted Harvey came in third to Mike Coffman in the 6th congressional district race. Coffman told CUAC he looks forward to working with the association; and * Matt Bergles lost in State House District 8.
Colorado credit unions actively participated in campaigning by walking precincts and calling members, the association said. Its CU Get Out the Vote program had nearly 100 campaign volunteers and made more than 115,000 communications on behalf of the credit union-supported candidates.

Convention volunteers landscape wounded vets home

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WOODBURY, Minn. (8/18/08)--On Friday, volunteers from the 2008 Republican National Convention staff and local Minnesota credit unions landscaped a home built for a wounded Iraq war veteran with Homes for Our Troops and the National Journal Group.
Click to view larger imageLynn Kothe (left), vice chair of the Minnesota Credit Union Foundation, and Dawn Dunkelberger of North Memorial FCU, Robbinsdale, Minn., fill in rock around shrubbery and flowers planted during Homes for Our Troops’ volunteer day Aug. 15. (Photo provided by the Minnesota Credit Union Network)
The home is the result of a joint project of Homes for Our Troops, the Republican National Convention, America’s Credit Unions, the Minnesota Credit Union Network, the Credit Union National Association (CUNA) and the National Journal Group. It will be presented to Sgt. Marcus Kuboy in September during the Republican National Convention in St. Paul. “This project has allowed credit unions to put our ‘people helping people’ philosophy into action,” said Daniel A. Mica, CUNA president/CEO. “This volunteer day brings us one step closer to completing the home for Sgt. Kuboy and making the American dream of home ownership a reality for this bravee soldier.” Kuboy, 30, a member of the Minnesota National Guard, was injured in March 2007 when an improvised explosive device exploded underneath the vehicle in which he was riding. The home will be specially adapted for him and is being built at no cost to his family. CUNA, the Credit Union Associations of Colorado and Wyoming, and the National Journal also are working with Homes for Our Troops and the Democratic National Convention Committee on a companion project for a veteran’s home with the Democratic National Convention near Denver.

Commonwealth CU reports new vishing attacks

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FRANKFORT, Ky. (8/18/08)--For the second time in three weeks, a Frankfort, Ky.-based credit union, Commonwealth CU, has been the target of an extensive vishing or "voice phishing" scam. Commonwealth sent a scam alert Friday about the latest attempt to gather information for possible identity theft purposes via automated telephone messages purporting to be from the credit union. Gloria S. Thomas, fraud and loss prevention manager at the -based credit union, said that Thursday and early Friday morning individuals began receiving telephone calls with an automated message that said the recipients' credit card had been suspended. The message left a phone number to contact to reactivate the card. "If you called the number you got an automated message that said, 'Press one to activate your card,'" she said. "When you pressed one, you were asked for your 16-digit credit card number." A variety of numbers were used, including some of the same phone numbers employed in the previous attack, three weeks ago. In that attack, thousands of Kentuckians received the recorded phone calls. The incidents prompted a warning to the public about the scam from the state's attorney general (News Now Aug. 11). New numbers used in Thursday's and Friday's scams are:
* 214-556-5796 in Plano, Texas; * 404-419-7498 and 404-498-4197, both in Atlanta, Ga.; * 604-484-9400, Vancouver, B.C., Canada; * 714-442-3659, Santa Ana, Calif.; * 800-909-9690, Port St. Lucie, Fla.; * 909-923-6441, Ontario, Calif.
Several numbers were used in both scam attempts. Many were companies that were "Masked for Caller ID." Three of the numbers were disconnected. Numbers that were used in both scan attempts are:
* 303-773-8228, Englewood, Colo.; * 412-729-9885, Elizabeth, Pa.; * 503-924-4505, Beaverton, Ore.; * 563-386-2311, Davenport, Iowa; * 617-507-6706, Boston, Mass.; * 720-204-1286, Longmont, Colo.; * 860-359-4493, Columbia, Conn.; * 909-474-7070; San Bernardino, Calif.; and * 949-225-3939, Irvine, Calif.
Another vishing scam was reported by Florida CU, Gainesville, Fla. It began receiving calls last week from members and nonmembers reporting they received an automated call or text message to their cell phones with the same tactic as the other attempts (Ocala.com Aug. 13).

Filene examines financial behaviors of young adults

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MADISON, Wis. (8/18/08)--Young adult households frequent credit unions at roughly the same levels as do all U.S. households. However, credit unions lag behind commercial banks, three to one, according to a new Filene Research Institute report. As credit unions seek to better serve the next generation of consumers, it becomes essential to understand how young adults are creating their financial lives, said the institute. Its report, Attracting Young Adults: What Do We Know About Their Use of Financial Institutions and Payment Behaviors?, looks at the financial behaviors of young adults and compares these behaviors to all households. Author Jinkook Lee, a professor of consumer sciences at Ohio State University (OSU) and a Filene Research Fellow, used the Consumer Finance Monthly, a nationally representative sample of U.S. households from a monthly survey conducted by OSU, to conduct the research. The study found that young adults rank convenience, product features, and service as the top three reasons, respectively, for choosing their primary financial institution. Young adults use a variety of payment instruments to manage their funds, the study found. Which type of instrument an individual uses depends upon the type of transaction and the socio-demographic characteristics of the payer. “Today’s 18- to 34-year-old population represents the next generation of credit union borrowers and savers,” says George Hofheimer, Filene chief research officer. “The Credit Union National Association reports that since the mid-1980s credit unions have struggled to convert this demographic into full-service members. Careful study of how this new generation is different from past generations could help reverse this long-term trend," Hofheimer said. "More important than careful study, though, is action," he said. "Every day that credit unions delay a young-adult strategy is another day their competitors gain in cementing a relationship with this demographic." Hofheimer proposes three activities credit unions can perform to effectively reach out to the 18-34 year-old market:
* When describing your value proposition to a young adult market, study the top reasons this segment chooses their primary financial institution; * Understand what elements of convenience matter most to young adults; and * Use data on specific payment choices to understand how young consumers are creating their financial relationship.
Copies of Attracting Young Adults: What Do We Know About Their Use of Financial Institutions and Payment Behaviors? are available free to institute members; $125 to non-members. For more information call 608-231-8550 or use the resource link.

Louisiana league op-ed CUs strong in tough times

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HARAHAN, La. (8/18/08)--The Louisiana Credit Union League has responded to news reports about the economy with an op-ed newspaper article noting that "one positive remains steady--Louisiana's credit unions." The article, written by league President/CEO Anne Cochran, appeared in theadvertiser.com (Aug. 15). It points out that 72% of all credit unions in Louisiana were rated in the highest two categories based on safety and soundness in 2007. The CAMEL (capital adequacy, asset quality, management, earnings and liquidity) ratings indicate that credit unions' management is "experienced, capable and operated under adverse conditions following hurricanes Katrina and Rita in 2005," wrote Cochran. She explained that all Louisiana credit unions are covered by the National Credit Union Share Insurance Fund and backed by "the full faith and credit of the U.S. government." Cochran referred to other financial institutions pushing through the up and down economy while credit unions "remain strong, offering good rates on savings accounts and low rates on loans. "In these uncertain economic times, individual and businesses are looking for a safe place to put their hard-earned money. The credit union is that place," the letter concluded.

Kinectas venture into check cashing marks first year

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MANHATTAN BEACH, Calif. (8/18/08)--Kinecta FCU’s purchase of Nix Check Cashing of Carson, Calif., one year ago brought 15,000 Nix customers into the credit union’s membership. The credit union acquired 53 Nix stores, added ATMs to 36 and opened service windows at five. “We have created a revolutionary business model that will bring credit union services to underbanked areas where nearly five million people live,” said Simone Lagomarsino, Kinecta president/CEO. The credit union also introduced three alternative financial products and services:
* A $300 payday loan alternative for the same fee that others charge on a $255 loan; * A rewards program that returns one-third of the loan fee into a savings account for qualified customers and currently is a pilot program in three stores; and * Change for Tomorrow, a savings program that allows Nix customers to put any amount of change, no matter how small, into a savings account. The program launches next month.
“Many Nix stores are in locations where few banks exist, leaving consumers with limited options,” said Tom Nix, Kinecta senior vice president and Nix Check Cashing president. “Kinecta’s acquisition of Nix has returned banking products to areas that have not had them for many years.” Kinecta has $4.4 billion in assets.

Ohio CUs work hard to inform candidates

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Keith Brooks, Capital Advocates; Ohio Senate candidate Karen Gillmor; and John Kozlowski, Ohio Credit Union League general counsel, recently met to discuss credit unions.
DUBLIN, Ohio (8/18/08)--Several Ohio credit unions and the Ohio Credit Union League worked to inform candidates about credit union issues at recent meetings and events. John Kozlowski, league general counsel, and Keith Brooks of Capitol Advocates, a Columbus lobbying firm, met with state Senate candidate Karen Gillmor about credit union issues. Gillmor was pleased to hear about credit unions’ sound mortgage lending practices, the league said (eLumination Aug. 13). “Sen. Gillmor was especially interested in the financial education initiatives put forth by the league and Ohio’s credit unions,” Kozlowski said. With one son in high school and two in middle school, she understands the importance and value of learning wise money management at a young age.” Midwest Community FCU, Defiance, gave U.S. Rep. Bob Latta (R-Bowling Green) a tour of the credit union Aug. 11. Latta met with credit union CEO Sonja Delaney, board members and management staff.
U.S. Rep. Bob Latta, right, (R-Bowling Green) visited Midwest Community FCU, Defiance, Ohio.
The Mahoning Valley Chapter hosted a golf outing with U.S. Rep. Tim Ryan (D-Niles), and state Reps. Ron Gerberry (D-Austintownship) and Tom Letson (D-Warren). It also hosted an evening reception with state Rep. Sandra Harwood and Rose Bartolomucci, Ohio Division of Financial Institutions deputy superintendent for credit unions. Western CU, Columbus, invited State Sen. Steve Stivers (R-Columbus) to the credit union Aug. 7. Credit unions play an important economic role in the communities they serve, he told credit union staff. Stivers said he would support legislation that gives credit unions more capacity to serve members, particularly in member business lending. Kozlowski and John Florian, league vice president of government affairs, also attended the meeting.
The Mahoning Valley Chapter hosted a golf outing with U.S. Rep. Tim Ryan (D-Niles). Pictured are: Paul Mercer, Ohio Credit Union League (OCUL) president; John Florian, OCUL vice president of government affairs; state Reps. Ryan, Ron Gerberry and Tom Letson; and Michael Kurish, CEO, Associated School Employees CU, Youngstown.
Western CU, Columbus, recently hosted Ohio Credit Union League Vice President of Governmental Affairs John Florian; State Sen. Steve Stivers (R-Columbus); Tom Furrey, CEO, Western CU; and John Kozlowski, OCUL general counsel. (Photos provided by the Ohio Credit Union League)