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CUs shine with free checking big banks back away

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CHICAGO (8/31/11)--While free checking is an endangered species at most large banks, credit unions continue to shine in this area,
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beating both big and small banks with their steadfastness to maintaining free checking for members, according to data from a study by a Chicago-based pricing research firm. Today, 78.6% of credit unions offer free checking--more than twice that of large banks with $50 billion or more in assets and more than community banks, says Moebs Services (American Banker Aug. 30). In 2009, roughly 96% of the big banks some form of free checking, although many had attached strings such as high minimum balances. Today, only 34.6% of big banks do. Nearly two-thirds of big banks have eliminated these services by adding fees or changing deposit account terms, said the research firm. Compare that with credit unions. In 2009, said the Moebs research, 85% of credit unions offered free checking. Today 78.6% do. Even smaller community banks are starting to cut their free checking offerings. In 2009, 78% of these banks offered the service; today, 70.8% do--a 7.2-point drop. While they would lose accounts if they started charging fees, the topic is on their board tables for discussion and some have adopted a wait-and-see strategy, according to the article. It notes that for smaller institutions, "charging new fees could be tantamount to suicide." Offering free checking is an opportunity for credit unions to differentiate themselves from large financial institutions, Marcus Schaefer, CEO of Truliant FCU, Winston-Salem, N.C., pointed out in the article. Truliant has no plans to charge for checking. Charging would be a last resort. Moebs Services blames the trend to cut free checking on a 2009 regulation that restricts banks' abilities to charge overdraft fees to help subsidize free checking. Other sources interviewed say banks are trying to offset revenue losses from the Dodd Frank Act's restrictions on debit interchange fees by starting to charge checking fees.

Calif. presents service philosophy and fin ed awards

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ONTARIO, Calif. (8/31/11)--The California and Nevada Credit Union Leagues have announced the California state-level winners in several service, philosophy and financial education awards. First place winners of the Dora Maxwell Social Responsibility Recognition Award are:
* The Golden 1, Sacramento, Calif., $1 billion-plus asset category, for its community shredding event, which destroyed more than 150,000 pounds of confidential information safely and securely. * San Francisco (Calif.) FCU, in the more than $500 million asset category, for its CommunityShare program, which gives back to the community through donations, employee volunteerism and fundraising activities.
The Golden 1 also won first place in its size category in the Louise Herring Philosophy in Action Award for its Lifeline Advance program to help members avoid costly fees associated with the use of pre-paid cards and check-cashing services. First place Desjardins Financial Education Awards went to:
* Educational Employees CU, Fresno, Calif., receiving the Desjardins Youth Financial Education Award in the more than $500 million asset category, for its "Wise Up" financial literacy program; and * Patelco CU, Pleasanton, Calif., receiving the Desjardins Adult Financial Education Award in the more than $500 million asset category for its various programs, including its CU@Work Seminars and community collaboration efforts.
The award winners will compete now in the national credit union recognition programs administered by the Credit Union National Association. For more information, use the links.

CU System briefs (08/30/2011)

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* DULUTH, Ga. (8/31/11)--The Greater Atlanta Credit Union Chapter of Georgia Credit Union Affiliates raised more than $40,000 for Children’s Miracle Network Hospitals at its Ninth Annual Bowl-A-Thon fundraiser in Decatur, Ga. About 200 bowlers and 15 sponsors participated. “Times are really tough in our economy, but we still managed to raise a considerable amount for CMN Hospitals and are so grateful to have so many loyal sponsors and participants to assist us with having another wonderful year,” said Laura Sterling of Atlanta-based Georgia’s Own CU and co-chair of the bowl-a-thon committee. Funds will support trauma services at Children’s Miracle Network Hospitals. Children’s has the only dedicated Pediatric Trauma Center in Georgia. The hospital provides support to more than 23,000 trauma patients each year. Credit unions have partnered with Children's Miracle Network Hospitals through Credit Unions for Kids since 1996 … * SYRACUSE, N.Y. (8/31/11)--Syracuse, N.Y. -based Empower FCU is offering an online course that assists drivers in reducing points and insurance costs. It now offers the New York State six-hour Point & Insurance Reduction Program course online through Empower Associated Services (EAS), a wholly owned subsidiary of the credit union. Completing the course will allow up to a 10% insurance reduction and may remove up to four points from the driving record of the principal operator of a vehicle. The $926 million asset credit union, through EAS, has offered classroom sessions on the topic since October 2007. While the program helps drivers reduce costs and points, "we also want to help them refresh their knowledge of today's vehicle and traffic laws, and pick up some safety tips," said Greg Knight, insurance manager at EAS. The online option allows drivers to take the six-hour course over a 30-calendar day period, said Burt Phillips, president and chief operating officer of EAS … * POUGHKEEPSIE, N.Y. (8/31/11)--As part of Hudson Valley FCU’s HVFCU@Work program, Marist College will offer a 20% discount on tuition for select graduate and adult undergraduate programs to the work program participants. HVFCU@Work is designed to bring the credit union into workplaces throughout the Poughkeepsie, N.Y. area. The program offers benefits for both the business owner and employees, including financial education seminars, on-site membership enrollment, and free insurance quotes. “Our members, especially those businesses that might not be able to afford their own tuition assistance program, can now provide their employees a great opportunity to further their education at a premier local institution,” said HVFCU President/CEO Mary Madden …

SW Bridge Corporate members vote to merge with Ga. Corporate

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DULUTH, Ga. (8/31/11)--The membership of Southwest Bridge Corporate voted overwhelmingly Tuesday to approve the corporate's merger with Georgia Corporate, a consolidation that will create Catalyst Corporate on Sept. 6. More than 98% of voting members approved the merger. The vote came one day after the corporates received approval to merge from the National Credit Union Administration. Tuesday's outcome was "gratifying, but it's no surprise," said Kerry Parker, chairman of the Executive Committee for Southwest Bridge's Member Advisory Council and president/CEO of A+FCU, Austin, Texas. "We have had member input all along the way--from the advisory council planning process to an earlier member vote on the plan, which received approval from 91.3% of the 540 voting credit unions," Parker said. "Most importantly, the membership voted with its capital pledges." The corporates raised about $93 million in capital from 875 members, representing 74% of previous capital shareholders. "The fact that so many credit unions, after completing months of due diligence, chose to capitalize Catalyst Corporate shows that the business model is what credit unions were looking for," said Georgia Corporate Board Chairman Lin Hodges, president/CEO of Associated CU, Norcross, Ga. "Credit unions have confirmed that they believe in a cooperative model, and that they appreciate the importance of scale when choosing a corporate." Georgia Corporate President/CEO Greg Moore said Catalyst's operating efficiencies will make a difference beyond pricing. "It means that we won't have to rely on our balance sheet, and that means less risk." Credit unions have made it known that they want to continue to use the services of a corporate but also reduce their exposure to risk. "Catalyst Corporate represents this low-risk value proposition by minimizing the amount of capital a credit union puts at risk," said Dianne Addington, president/CEO of Southwest Bridge Corporate. Catalyst's model balance sheet is more conservative that what is required by the new Regulation 704, she added. Hodges noted that there should be no problem with today's vote at the Georgia Corporate. Its board "has been actively engaged in the details of this consolidation and has approved each major component of the plan in the past; this final vote ratifies the merger so that it can move forward this weekend." The merger will make Southwest Bridge Corporate the first corporate to come out of bridge status--well in advance of the two-year timeframe established by the NCUA last fall. "We believed it important to act quickly so that we could return to the business of creating value for our members," Addington said. "This merger allows for a strong, efficient, member-driven corporate that will meet the needs of the credit union community--for both our current members and other credit unions that are seeking a corporate home," said Moore.

Illinois chapter leaders play ball at annual conference

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NAPERVILLE, Ill. (8/31/11)--Nearly 80 leaders from 29 chapters of the Illinois Credit Union League (ICUL) attended the state's annual Chapter Leaders Conference, hosted by the league and the Bloomington Chapter of Credit Unions in Normal, Ill. The event ended Friday. Its theme of "Play Ball!" provided an opportunity for attendees to play their strengths and share ideas, events, and promotions.
Illinois Credit Union League President/CEO Dan Plauda urges attendees at the league's annual Chapter Leaders Conference Friday to "play ball" by playing to their strengths and sharing ideas, events and promotions. (Photo provided by the Illinois Credit Union League)
"Chapters are at the core of the Illinois Credit Union System and the movement," said Dan Plauda, ICUL president/CEO, at the conference. "They play such an integral part that we could not accomplish what we do from grassroots political advocacy efforts to fundraising to community relations activities." Jim Karch, director of public works for the City of Bloomington, presented information Friday on team building and strengths-based leadership. The conference closed with awards to winners of the Credit Union Political Action Council's (CUPAC) annual chapter fundraising competition. Winners are:
* First place, Southern Illinois Chapter, with more than $15,083 raised. This marks the 12th time the chapter has won first place in the competition; * Second place, Burnett Chapter, with more than $12,910; * Third place, Kankakee Valley, $11,355; and * Most improved chapter, a new award, Illinois Quad Cities Chapter, which increased its fundraising by 615.14%.
Fifteen chapters also received honorable mentions for raising $1,000 or more for CUPAC, during 2010.

Idaho league to celebrate 75th on Sept. 12

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BOISE, Idaho (8/31/11)--The Idaho Credit Union League celebrates its 75th anniversary on Sept. 12. “This is a momentous milestone in the life of any enterprise, but especially so for our Idaho’s credit union movement,” said league President/CEO Alan Cameron. “With our relatively small population and economy, Idaho’s credit unions have relied upon their tradition of service as the foundation for the success they have enjoyed. “Out of hundreds of credit unions formed by Idahoans since 1935, the 59 credit unions in business today are here because of the good things they have brought to the lives of their members.” Nine credit unions joined together in September 1936 to form the league. Since then, it has evolved from an organization operated by volunteers to a full-service, fully staffed trade association providing assistance and support with regulatory compliance, educational offerings, communications assistance, financial products and service recommendations. The league will host an open house at its office from 10 a.m. to 2 p.m. (MT) on Sept. 12. Formal ceremonies begin at 11 a.m.

CUs back to work in Irenes wake

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MADISON, Wis. (8/31/11)--Credit unions on the East Coast in the Northeast continued Tuesday to recover from the effects of last weekend’s Hurricane and Tropical Storm Irene.
One employee of Green Mountain CU, South Burlington, Vt., was unable to access his home as a result of this road damage caused by flooding. (Photo provided by Green Mountain CU)
While the impact along the coast was limited primarily to power outages, areas of the Northeast experienced flooding. Vermont was among the hardest hit areas. A branch of Vermont State Employees CU (VSECU) located in a state office building in Waterbury, Vt., was closed due to flooding. The branch is inaccessible, according to Terry Fields, VSECU vice president of finance. “We could see the waterline was about six feet high,” Fields said. “We expect to lose an ATM, all of the equipment in the branch, staff personal belongings, pretty much everything.” A former branch used for records retention and training was also flooded, but the damage was limited, Fields told News Now. The credit union was pumping water out of the facility on Tuesday. Although his credit union’s facilities weren’t affected by the flooding, Brian Fogg, president/CEO of Credit Union of Vermont, Rutland, Vt., spent Monday helping one of his employees bail water out of his home. Fogg said one of the credit union’s members was killed in the flooding and several of his employees have been impacted. Some have homes that are flooded, Fogg said. Others can’t reach their homes because of flood waters. “The credit union didn’t get hit, but we all know folks that did,” Fogg said. “This is a small state. We all know each other. Everyone’s just trying to help each other out.” Green Mountain CU, South Burlington, Vt., wasn’t directly impacted by the flooding, but at least one employee can’t reach his home because the road has been washed away, a common occurrence in Vermont this week, according to the credit union’s President/CEO Ginny Fleischman. The National Federation of Community Development Credit Unions has resumed operations at its Lower Manhattan headquarters following Irene. While the federation's offices saw no damage from the storm, some headquarters staff remain unable to commute to New York City from outlying suburbs. All of the federation's field staff in Madison, Wis.; Colorado Springs, Colo.; and San Francisco are working as usual, and most headquarters staff are accessible by e-mail. The federation has been reaching out to member community development credit unions, and while the majority report little or no damage, some have been affected. Renaissance Community Development CU, Somerset, N.J., was without power, phone services, or Internet access Tuesday morning. “We have not been given a time when we can expect these services will be restored," said CEO Shirley Spruill. “As a result we may not be able to answer members on a timely basis." In Vermont, another CDCU, Opportunities CU, Winooski, Vt., reported that its facilities were not directly affected, but many members have been displaced due to flooding. The credit union is already considering using the Housing and Urban Development Title 1 program, which provides 90% loan guarantees for home repairs (up to $7,500 with no collateral and $25,000 with collateral), to assist members, the federation said. In New Jersey, the New Jersey Credit Union League has been calling state credit unions to assess damages. So far, the league, the league has learned only of minor damages and power outages. Scott Teel, marketing director of Agility Recovery, a CUNA Strategic Services provider, said there was less wind damage and debris damage than expected from the Hurricane Irene. His company transported more emergency equipment into areas of anticipated need than were ultimately required. Teel said most recoveries involved telecommunication and power. “We had more members placed on alert than we’ve had in a long time, which means people took it seriously and were prepared,” Teel said. “The good news was a lot of them didn’t need to elevate their status.” Alert status means members are prepared to mobilize assets to disaster recovery status, Teel said.

Georgia CU Affiliates honors Maxwell Desjardins winners

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DULUTH, Ga. (8/31/11)--Georgia Credit Union Affiliates announced its statewide winners of the 2011 Dora Maxwell and Desjardins competitions. Georgia’s 2011 Dora Maxwell Social Responsibility Community Service Award first-place winners include:
* 1st Choice CU, Atlanta, $20 million to $50 million assets; * Credit Union of Atlanta, $50 million to 100 million assets; and * United 1st FCU, St. Mary’s, $100 million to 200 million assets.
DOCO Regional FCU, Albany, was the first-place winner of the Desjardins Youth Financial Education Award in the $50 million to $150 million asset category. Credit Union of Atlanta was the first-place winner of the Desjardins Adult Financial Education Award in the $50 million to $150 million asset category. The state awards pave the way for the first-place winners to compete for the national Credit Union National Association awards.

Michigan New York CUs talk MBLs more with lawmakers

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LANSING, Mich., and ALBANY, N.Y. (8/31/11)--Credit unions in New York and Michigan were busy during the past week, advocating lifting credit unions' member business lending (MBL) cap and discussing other issues with members of Congress, who were back in their districts during the August recess.
Buffalo, N.Y., areas credit unions and the Credit Union Association of New York (CUANY) met with U.S. Rep. Kathleen C. Hochul (D-N.Y.) at her office in Williamsville, N.Y., to discuss credit union issues such as lifting the member business lending cap. Pictured are, from left: William J. Mellin, CUANY president/CEO; Marsha Brauer, Clarence Community & Schools FCU; Edward Sandell, Cornerstone Community FCU; Hochul; Simone Fancher-Rowan, Clarence Community & Schools FCU; Jim Budde, Cornerstone Community FCU; and Laurie Baker, The Summit FCU. (Photo provided by the Credit Union Association of New York)
The Credit Union Association of New York (CUANY) and representatives of credit unions from the greater Buffalo area met with U.S. Rep. Kathleen C. Hochul (D-N.Y.) at her office in Williamsville, N.Y. The visit was part of CUANY's initiative to meet with all of New York's freshman representatives. Eight representatives from Clarence Community & Schools FCU, Cornerstone Community FCU and The Summit FCU discussed issues impacting the area and their credit unions, and discussed the Small Business Enhancement Act (S. 509 and H.R. 1418) currently before Congress. The measure proposes raising credit unions' MBL cap to 27.5% of assets from the current 12.25%. The group shared statistics from the Credit Union National Association (CUNA), noting that in the first year of enactment, the law would help credit unions pump $13 billion into the economy for business loans, creating more than 140,000 new jobs without cost to taxpayers or the government. Hochul, who said her focus is on creating jobs and helping small businesses succeed and grow, indicated she would further study the credit union MBL bill. According to William J. Mellin, CUANY president/CEO, who also attended the meeting, "Rep. Hochul gained a better understanding of credit unions and how they serve their members and communities." In Michigan, three separate meetings with congressmen were held during the past two weeks, according to the Michigan Credit Union League (Michigan Monitor Aug. 29).
U.S. Rep. Tim Walberg (R-Mich.) met with credit union leaders in Jackson, Mich., where they discussed the Small Business Lending Enhancement Act. Credit unions involved were CP FCU, EECU and Monroe Community CU. (Photo provided by Michigan Credit Union League)
CP FCU, Jackson, Mich., hosted a discussion on Aug. 22 with U.S. Rep. Tim Walberg (R-Mich.). Attendees included CP FCU staff and leaders from Jackson-based EECU and Monroe Community CU, Monroe. Credit union leaders noted the importance of making more credit available to small businesses and shared examples of how local credit unions continue to help their small business members with credit needs. More than 50 credit union leaders gathered Aug. 19 in Lawrence, Mich., to host the annual Greater Southwest Chapter legislative breakfast reception with U.S. Rep. Fred Upton (R-Mich.). Upton discussed his recent appointment to the congressional "Super Committee" that will address how to reduce the federal deficit by more than $1.3 trillion. He will join fellow Michiganite, U.S. Rep. Dave Camp (R-Mich.) on the committee.
More than 50 credit union leaders heard U.S. Rep. Fred Upton (R-Mich.) speak at a chapter legislative breakfast in Lawrence, Mich. Aug. 19. (Photo provided by the Michigan Credit Union League)
Upton, who is chairman of the House Energy and Commerce Committee, updated attendees on issues that could impact the business climate in Michigan. Participants asked questions on federal topics of interest to credit unions. Upton continues to be a strong credit union supporter, said the league. "As a credit union member for more than 30 years, I can say my credit union has always treated me well," Upton told the group. Credit unions also gathered at Lake Michigan CU's headquarters in Grand Rapids on Aug. 23 to discuss the MBL measure in Congress with U.S. Rep. Justin Amash (R-Mich.).
Member business lending was a key topic in a discussion between credit unions and U.S. Rep. Justin Amash (R-Mich.) during a meeting at Lake Michigan CU headquarters Aug. 23 in Grand Rapids, Mich. (Photo provided by the Michigan Credit Union League)
Attendees included representatives from LMCU, Kellogg Community FCU, Rockford Community FCU, Preferred FCU, Option 1 FCU, and My Personal CU. They discussed the increasing need for small business credit and the challenge in justifying costs associated with developing a small-business lending program with the current 12.25% of assets cap on MBLs. The group told Amash that more than 140 credit unions offer small business loans to their members and that H.R. 1418 would make millions of additional credit union capital available to small businesses in Michigan. Amash also discussed core components of his recent proposal for a balanced budget amendment and answered questions from the credit unions.