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CU System Archive

CU System

San Francisco paper CUs reposition for biz members

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SAN FRANCISCO, Calif. (8/29/11)--Credit unions in the San Francisco Bay area are looking to reposition themselves to serve business members, according to an article in the San Francisco Business Times (Aug. 26). "These credit unions saw a silver lining to the 2008 financial crisis that created an opportunity for them to pull in business borrowers who had trouble finding financing elsewhere as the demise of major banks and near-collapse of other business lenders spurred a pullback in lending," said the article. The item spotlights local area credit unions' efforts to serve members with business loans, as well their efforts to encourage Congress to lift their member business lending (MBL) cap to 27.5% of assets from 12.25%. "A lot of our individual members operate small businesses," Redwood CU CEO Brett Martinez told the paper. Many businesses were overlooked by the large banks, but Redwood's loans go to "microbusinesses" with less than $1 million in revenue. The more-than-$1.72 billion asset, Santa Rosa-based credit union is picking up business members from banks that decided not to renew loans or credit lines. San Jose-based, $1.5 billion asset Technology CU also is stepping up business loans, which account for the majority of its loan growth, the article said. Recent clients include a dentist seeking Small Business Administration financing and a small business owner taking out a loan to buy out a partner, the article said. The credit union services clients from startups to established companies with 50 employees. The article also features Stanford FCU, which offers commercial mortgages up to $10 million, equipment loans up to $250,000 and business credit cards among its business programs, and Patelco CU, which discussed lifting the MBL ceiling. The Credit Union National Association (CUNA), state leagues and nation's credit unions are pressing for Congress to adopt the Small Business Enhancement Act (S. 509 and H.R. 1418), which would raise the lending cap. By allowing credit unions to create more business loans, Congress would enable them to inject $13 billion in small loans into the economy and create 140,000 jobs--with no cost to taxpayers, said CUNA. CUNA and the leagues have encouraged credit unions and their members in all states to contact their legislators in their home-state offices during the current congressional District Work Break and urge them to support the MBL bills. To read the full article, use the link.

Symposium Mature CU industry must test limits

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CHARLOTTESVILLE, Va. (8/29/11)--Credit unions are a mature industry that should test its limits and determine what's next for credit unions, speakers told 65 credit union leaders and academics from across the nation at a Credit Unions at the Crossroads Symposium, held Aug. 10-12 at the University of Virginia. The gathering addressed pressing system issues, including slow growth in market share, efforts to reach today's youth, capital needs, key regulatory issues and cooperation within the system. It was co-sponsored by the University of Virginia Community CU, the University of Virginia's Darden School of Business, and its McIntire School of Commerce. "We all see the harsh realities of the marketplace," said Alison DeTuncq, CEO of the University of Virginia Community CU, Charlottesville, Va. "Many of us are painfully aware that our memberships are aging, that our regulatory burdens are growing, and that the traditional credit union business model poses its own unique challenges. The symposium sought to lay a foundation on which we can build a research-based framework that answers the question: What's next for America's credit unions?" she said. In the next month, the Darden and McIntire schools will work with the Filene Research Institute to analyze information and audio recordings of the event to identify current research from Filene that best speaks to the "credit union of the future," as well as topics needing new or additional research. "Credit unions emerged from the financial crisis and the recession with a sense of urgency to better position themselves as a force within the financial services industry," said Ronald T. Wilcox, a professor at the Darden School of Business. "The consumer finance landscape was changing long before the turmoil of the past few years; that change will only accelerate, forcing financial services providers to prove themselves by being innovative, responsive and adaptable. The credit union industry seems eager to accept that challenge and test its own limits," he added. The symposium covered topics such as financial and market share trends for credit unions, the characteristics of top-performing credit unions and community banks, current credit union research that speaks to the system's future, legislative and regulatory issues, credit unions' ability to adapt to the marketplace, marketing, the role of credit union service organizations and trade associations, staff development, governance and more. "The credit union industry has matured to a point that it needs answers to fundamental business questions," said George A. Overstreet Jr., a professor at the McIntire School of Commerce. "Some of the industry's core values are being challenged; its business model faces real and significant threats; and credit unions are struggling for relevance among the next generation of Americans. Credit unions understand the stakes, and fortunately, there's neither a shortage of passion within credit unions, nor a shortage of capable leaders ready to blaze the trail for the industry's future," Overstreet concluded.

CU System briefs (08/26/2011)

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* YAKIMA, Wash. (8/29/11)--Members of Yakima Valley CU, Yakima, Wash., have approved the merger of their credit union with Catholic CU, also based in Yakima. The merger will be effective Oct. 1. The name and brand of the combined $471 million asset credit union will be made public in mid-September. Mina Worthington, Yakima Valley president/CEO will lead the new credit union, and Paul Regimbal, president/CEO of Catholic CU will become senior vice president of corporate integration until his retirement in June 2012. The merger will provide nearly 50,000 members with service from eight branches. Its board will consist of 13 members, seven from Yakima Valley and six from Catholic CU. State and federal regulators have already approved the merger proposal (Yakima-Herald.com Aug. 25) ... * FORT WORTH, Texas (8/29/11)--American Airlines FCU (AA CU) presented a $50,000 check to Children's Miracle Network Hospitals
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after the 15th Annual American Airlines FCU Golf Tournament in Grapevine, Texas. The check was presented Thursday at AA CU headquarters in Fort Worth, Texas, and will be split between Cook Children's Medical Center Foundation and Children's Medical Center Foundation. Tournament sponsors included CO-OP Network, Global Vision Systems Inc., Fiserv, PSCU Financial Services, and others. The donation from the golf tournament includes a CO-OP Financial Services Miracle Match of $10,000. Credit unions have partnered with Children's Miracle Network Hospitals through Credit Unions for Kids since 1996. From left are: Angela Bynum, sponsor relations representative at Children's Medical Center of Dallas; Angie Owens, president/CEO of AA CU; Jackie Daulton, Children's Miracle Network coordinator at Cook Children's Health Foundation; and Pedro Noda, golf tournament director and emarketing manager at AA CU. (Photo provided by American Airlines CU) …

Baxter CUs Bratsakis named MDDCCUA presidentCEO

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COLUMBIA, Md. (8/29/11)--The Maryland and District of Columbia Credit Union Association (MDDCCUA) announced John Bratsakis will be the organization’s new president/CEO. “John brings a lot to our organization,” said Board Chairman Miguel Boluda Jr., CEO of the Pan American Health Organization/World Health Organization FCU, Washington, D.C. “He has a track record of success throughout his career and demonstrates a commitment to the industry that we feel makes him the perfect choice to lead our association and help our credit unions successfully navigate the future.” Prior to joining MDDCCUA, Bratsakis was the senior vice president of Baxter CU in Vernon Hills, Ill., where he helped develop new business relationships with key sponsor companies for the $1.5 billion asset credit union. Bratsakis also was responsible for representing the credit union at the state and national level regarding governmental/regulatory affairs, and for managing multiple departments within the credit union. Bratsakis served on the Illinois Credit Union League and Service Corp. Board of Directors for more than 10 years, acting as chair from 2008 to 2010. He currently is a member of the Credit Union National Association Governmental Affairs Committee. “John will be instrumental in ensuring the success of MDDCCUA and its member credit unions for years to come,” Boluda said. “We feel that his broad experience both in credit unions and associations will provide an excellent contribution to our organization.”

Three CUs in top 10 companies for employees benefits

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DES MOINES, Iowa (8/29/11)--Three credit unions were among 10 growing companies receiving national recognition for offering employees extraordinary benefits, despite a chaotic economy. An independent judging panel of employee benefits experts named Postal CU, Woodbury, Minn.; Consolidated FCU, Portland, Ore.; and Veridian CU, Waterloo, Iowa, as three of The Principal 10 Best Companies for Employee Financial Security. The Principal Financial Group sponsors the national program, which is in its 10th year. It honors growing companies for their commitment to their employees’ financial security. As part of the recognition, The Principal awards a donation to a charity selected by each winning company.

Catalyst Corporate Merger on track

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DULUTH, Ga. (8/29//11)--Integration work is progressing as the Sept. 6 date for the planned launch of Catalyst Corporate FCU in Duluth, Ga., draws near. If the National Credit Union Administration (NCUA) approves the proposed merger of Southwest Bridge Corporate FCU and Georgia Corporate FCU, Catalyst Corporate will be the new entity. The NCUA board is scheduled to review the merger request at its meeting today. If the weekend’s weather prompts a government closure, the meeting will be held at 2 p.m. ET Tuesday. Following the NCUA Board’s review, the members of Southwest Bridge Corporate will conduct a member vote during an in-person meeting on Tuesday at its offices in Plano, Texas. Details regarding the proposed merger and ballots were sent to Southwest Bridge Corporate’s membership in mid-August. Members can vote by mail. Results of the member vote will be known shortly after the meeting. “We continue to be optimistic that the input from hundreds of members and the extensive year-long integration planning will culminate in a successful merger and launch of Catalyst Corporate on Sept. 6,” said Greg Moore, president/CEO of Georgia Corporate FCU. As of Thursday, 875 members have committed $92.7 million to capitalize Catalyst Corporate FCU. Shortly after its launch, Catalyst Corporate will begin promoting two upcoming events:
* The Economic Symposium, which will be held in Atlanta, Sept. 28-29; and * The Economic Forum, which will be held in Frisco, Texas, Oct. 25-26.
Both events will be open to all credit unions, regardless of membership, Moore said.

Six finalists picked for Youth Week theme

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MADISON, Wis. (8/29/11)--Six ideas have been selected as finalists for the National Credit Union Youth Week theme. National Credit Union Youth Week--April 22-28--is CUNA’s official designation of an annual, national celebration for credit unions that support youth financial literacy all year long. April is National Financial Literacy Month. A National Youth Saving Challenge will run the entire month. Credit unions can participate for a week or the entire month. The six theme finalists are:
* Millionaire for a lifetime; * Shape up your savings; * Groovin’ with my credit union (1960s and 1970s); * Strike gold at the credit union (gold rush); * Be a super saver; and * iMatter, iSave, iAm a Member.
Voters are asked to rank the ideas in descending order.

Dupaco social media contest puts game leaders on billboards

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DUBUQUE, Iowa (8/29/11)--Dupaco Community CU has employed a non-traditional reward system for loyal credit union members who stop into its locations for service.
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Introduced in August with Dupaco's member thank you campaign, the Dubuque, Iowa-based credit union is using the social media application Foursquare to engage members. The free application, available for download on mobile devices, uses satellite GPS to allow users to "check in" while at retail establishments, service organizations, public spaces and other locations. In exchange for their check in, users receive special offers served up by participating businesses or organizations. Rewards to members who check in while at a Dupaco branch range from free koozies to gift certificates to Dupaco business partners, and from registration for weekly $50 gas card drawings to an opportunity to be featured on a digital billboard, where available. "For Dupaco, the value in participating in the Foursquare social circle is engagement with people in a unique, viral way," said Jennifer Hanniford, Dupaco assistant vice president of interactive marketing. "When people check in to Dupaco, their Foursquare friends know they're here. They can tip off the Foursquare community about their experience. It's a genuine tool for user-generated reviews on venues." Social circles are a natural part of Dupaco's unique cooperative structure, she said. "Through a credit union, members come together and pool deposits, and then responsibly provide their friends and neighbors low-cost loans for cars, homes, education, funding for small businesses and more." Dupaco has extended the reach of its Foursquare efforts by promoting it on other interactive channels including Facebook and Twitter, and highlighting it on area billboards. "Foursquare players have the opportunity to become 'mayor' of any venue based on the frequency of their check-ins. Dupaco is paying homage to our Foursquare mayors by featuring them on digital billboards in markets where digital billboards are available, like Dubuque and Cedar Rapids," said Hanniford. "The public sees the Foursquare mayor names in lights and it generates more excitement to play and compete for the coveted mayorship position." The free Foursquare application is available for download on most smart phones and also has an alternate SMS version. For more information, use the link.

Texas league uses NCUF grant for fin lit tool

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FARMERS BRANCH, Texas (8/29/11)--The Texas Credit Union League has created two traveling Reality Fair sets for Texas credit unions and has held six fairs in high schools throughout Texas since May. The fair is an interactive financial literacy tool for high school students, who participate in a hands-on event that guides them through the personal financial management process, including budgeting, saving and investing in a simulated real-world environment.
Students shop for vehicles during a Reality Fair at Goose Creek Memorial High School in Baytown, Texas. The fair was sponsored by Beacon FCU, La Porte, Texas. (Photo provided by the National Credit Union Foundation)
To help fund the initiative, the league received grants last year from the National Credit Union Foundation, the Texas Credit Union Foundation (NCUF), and the Friends of Consumer Freedom. “Thanks to the grant funding, the league has been available to offer the traveling Reality Fairs to credit unions all over Texas,” said Mike Delker, TCUL senior vice president of credit union relations. “Through this type of collaboration, the dollars go a long way in helping credit unions demonstrate to their communities that there are solutions available for their financial concerns.” “Financial literacy is a tremendous concern for families from all backgrounds in Texas,” said Natasha Melugin-McAdoo, director of the REAL Solutions program in Texas. The fairs raise awareness of serious monetary issues for students and “pass that message along when participants relay what they have learned to their parents.” Earlier this year, TCUL created the turnkey fairs using materials from America’s Credit Union Museum’s CU 4 Reality Program (cu4reality.org). The league then held six Reality Fairs in three Texas schools, reaching nearly 1,000 students since May. More fairs are scheduled for fall and spring. TCUL’s Reality Fair will also be included as part of the orientation process for incoming students at a Texas college. “We are looking to offer more Reality Fairs in Texas and around the country through REAL Solutions,” said Lois Kitsch, National REAL Solutions program director for NCUF. To see a Reality Fair video, use the link.

East Coast CUs stood ready for weekends Irene

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MADISON, Wis. (8/29/11)--Credit unions along the East Coast were well prepared for Hurricane Irene’s arrival this past weekend. The Maine Credit Union League posted a special Hurricane Irene section on its website last week, with links for consumers to obtain additional information, news and assistance from the American Red Cross, Federal Emergency Management Agency, the National Hurricane Center and the National Weather Services. Although it has been two decades since a significant Hurricane struck Maine, other natural disasters during that time have prompted credit unions to develop plans and procedures that have been activated on several occasions, the Maine league said. Maine credit unions were well-positioned to continue to provide the state’s 611,000 credit union members with access to financial services, the league said. Since three-quarters of Maine’s credit unions participate in a shared branching network, most members would likely be able access their accounts at another credit union location if their own credit union is not available. There are nearly 150 shared-branch locations in Maine and more than 4,000 nationwide. Chartway FCU, Virginia Beach, Va., offered its members a Hurricane Irene update page on its website, including a pre-hurricane checklist to prepare for a possible disaster situation. To ensure employees had time to secure items around their homes and take care of their families, Chartway closed branches and back offices in North Carolina, Virginia, Rhode Island and New Jersey early on Friday. Branches in all four states remained closed on Saturday. The credit union also granted “liberal leave” for employees in the affected areas, according to Heidi Worker, Chartway FCU corporate communications director. Chartway also made extra cash available in ATMs in affected areas, Worker said The Pennsylvania Credit Union Association warned its members that flooding is a great threat throughout eastern Pennsylvania and New Jersey, particularly in the Philadelphia area (Life is a Highway Aug. 26). The New Jersey Department of Banking & Insurance (DOBI) issued on Thursday a disaster preparedness bulletin Thursday to all state-chartered financial institutions, including credit unions, said the New Jersey Credit Union League (The Daily Exchange Aug. 26). The department reminded financial institutions they are required to maintain disaster response plans to address all reasonably foreseeable risks to business continuity in the event of a catastrophic event. The bulletin recommended that financial institutions review their preparedness plans to include any special provisions for check cashing either by depositors or non-depositors, wire transfers, waiving certain fees and meeting credit needs. New Jersey credit unions were advised to take reasonable steps to adopt emergency by-laws establishing the terms and conditions for continuity of services in accordance with the Credit Union Act of 1984, according to the bulletin. CUNA Mutual Group said Friday it had activated its disaster recovery team to assist credit unions threatened by Hurricane Irene. The company also contacted potentially affected property and casualty policyholder credit unions throughout the projected path. The company will continue to monitor the storm and asked credit unions to contact the company around the clock if they sustain damages. CUNA Mutual said it would follow up with the credit unions once the storm passed. Agility Recovery, a CUNA Strategic Services provider, offered a webinar, “Hurricane Irene: Current Threats & Practical to Prepare,” to help credit unions prepare for the weekend. The presentation on Friday addressed the factors unique to Irene and practical steps for preparation in advance of the storm. Federally insured credit unions in 16 states and the District of Columbia, in the potential path of Hurricane Irene, received a National Credit Union Administration (NCUA) Dispatch Friday urging them to undertake a thorough review of their business continuity and disaster preparedness, response, and recovery plans in preparation for potential incidents related to this storm News Now Aug. 26).

Southeast Corporate goes to plan B merger option

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TALLAHASSEE, Fla. (8/29/11)--As corporate credit unions move toward capitalization deadlines, one corporate--Tallahassee, Fla.-based Southeast Corporate FCU--announced Friday that the capital commitments received from its members have fallen short of the $80 million needed to operate as a stand-alone corporate. As a result, all its member capital commitments received will be canceled. Along with its recapitalization efforts, Southeast Corporate has been working on alternative solutions and is well into the process of identifying a merger partner. “We appreciate the many members who supported our efforts with capital commitments and also thank every member for giving their time and consideration to Southeast Corporate during this process. We all knew the challenges facing the corporate system, and Southeast Corporate specifically, were significant,” said Brad Miller, president/CEO of Southeast Corporate. “While there is uncertainty in any alternative, our objectives in a merger remain the same as they were for recapitalization--protecting and preserving member capital, maintaining continuity of service, and creating long-term value for members.” Southeast Corporate assessed the ability of several corporates to meet member objectives. From this review, it narrowed the focus to a short list of potential merger candidates that can provide the best alternative option for the member/owners of Southeast Corporate. “We’re conducting due diligence now and expect to announce our preferred merger partner soon,” Miller said. "The merger plan, which must be approved by the National Credit Union Administration, will be brought to our member/owners for approval, giving them ample time to evaluate and make decisions regarding current service activity and the business plan for the merged organization. Our members can be assured that they will continue to receive uninterrupted service from Southeast Corporate as this alternative process proceeds.”

NEW Southeast Corporate wont recapitalize moves to merger plan

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TALLAHASSEE, Fla. (FILED 10 a.m. CT)--Southeast Corporate FCU's capital commitments received fell short of the $80 million goal necessary to operate as a stand-alone corporate, the corporate announced today. As a result, all member capital commitments received will be canceled. Along with its recapitalization efforts, Southeast Corporate has been working on alternative solutions and is well into the process of identifying a merger partner. “We appreciate the many members who supported our efforts with capital commitments and also thank every member for giving their time and consideration to Southeast Corporate during this process. We all knew the challenges facing the corporate system, and Southeast Corporate specifically, were significant,” said Brad Miller, president/CEO of Southeast Corporate. “While there is uncertainty in any alternative, our objectives in a merger remain the same as they were for recapitalization--protecting and preserving member capital, maintaining continuity of service, and creating long-term value for members.” Southeast Corporate assessed the ability of several corporates to meet member objectives. From this review, it narrowed the focus to a short list of potential merger candidates that can provide the best alternative option for the member/owners of Southeast Corporate. “We’re conducting due diligence now and expect to announce our preferred merger partner soon,” Miller said. "The merger plan, which must be approved by the National Credit Union Administration, will be brought to our member/owners for approval, giving them ample time to evaluate and make decisions regarding current service activity and the business plan for the merged organization. Our members can be assured that they will continue to receive uninterrupted service from Southeast Corporate as this alternative process proceeds,” Miller said.