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Experts Triton purchase will affect ATM prices

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CHICAGO (8/11/08)--After Nautilus Hyosung buys ATM manufacturer Triton Systems, the two will have a majority of the off-premise ATM market and will control prices, according to a rival manufacturer. Nautilus Hyosung, a Korean ATM manufacturer, announced plans to buy Long Beach, Miss.-based Triton last month. Bill Dunn, vice president of sales for Tranax Technologies, told ATM and Debit News (Aug. 7) that he expects the combined company to control 85% of the off-premise market. Tranax is a competitor of the two companies, and was partnered with Nautilus until January 2007. Leon Majors, president, Phoenix ESP Payments Research Group Inc., said Nautilus and Triton would control 70% of the off-premise market. Independent sales organizations (ISOs), which buy ATMs and resell them, could handle a price increase of a few hundred dollars because ATM prices are already low, Majors told the newspaper. ATM manufacturers charge $2,500 to $3,000 per off-premise ATM. ISOs replace about 30,000 ATMs each year, ATM and Debit News said. Some experts say Nautilus will keep prices low to put the competition out of business. A lawsuit Triton recently filed against six of its former executives states that Nautilus offers ATMs at low prices to drive other manufacturers, such as Tranax and Triton, out of business. Nautilus cut its prices when it entered the U.S. market in 2006. Prices for ISOs dropped 30% to 40%. With the reduction in price, some companies, including Greenlink Technologies, cut their production of off-premise ATMs. Triton sold 10,454 ATMs in 2007, compared with 12,300 in 2006. Tranax shipped 9,000 units in 2007, compared with 14,500 the year before. Last year, Nautlius shipped 14,433 ATMs, according to ATM and Debit News.

N.J. league postpones election until after bylaw vote

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HIGHTSTOWN, N.J. (8/11/08)--The New Jersey Credit Union league has suspended new election rules until after its member credit unions vote on a bylaw amendment. The league board of directors created a governance task force last year to examine the league’s existing governance model and recommend changes to improve it. The result is a bylaw amendment which will be voted on in Atlantic City in September (The Weekly Exchange Aug. 8). Because the amendment would create historic potential changes in the league’s governance model, the board decided to suspend election rules. The bylaw amendment needs two-thirds approval of delegates present at the annual meeting to pass. The nomination process should begin around Oct. 1, the league said. If the amendment is approved, approved, the new election rules will be immediately implemented for the 2009 election cycle, with the newly elected board seated in January.

Georgia CUs donate 39000 for CMN

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DULUTH, Ga. (8/11/08)--Not-for-profit Georgia financial institutions raised more than $39,000 for Children’s Miracle Network (CMN) through the Credit Unions for Kids fundraising campaign, which included sales of a specially designed cookbook.
From left: Maureen Bock, director of card services, Georgia Credit Union Affiliates (GCUA); Terilyn Walton, program coordinator, Children’s Healthcare Atlanta; singer LeAnn Rimes; and Kristi Arrington, GCUA vice president of information development, presented a check to Children’s Miracle Network in Atlanta at a July concert, featuring Rimes. (Photo provided by Georgia Credit Union Affiliates)
Patients at Georgia’s children’s hospitals will benefit from this contribution by Georgia credit unions, said the Georgia Credit Union Affilaites. The cookbooks included recipes submitted by credit union staff and members throughout the six-month campaign. Thirty-three credit unions across Georgia collaborated to raise funds to help sick and injured children receive quality health care. One hundred percent of the funds have been donated to CMN. “Children’s Miracle Network is such a worthy charity; how could we not participate in this fundraising effort?” said Marshall Boutwell, CEO, Gwinnett FCU, Lawrenceville, Ga. Credit union representatives presented the check to Children’s Miracle Network at a LeAnn Rimes concert held at Turner Field in July. Rimes, a long time supporter of CMN, is the face of the 2008 Georgia credit union awareness campaign. She contributed a recipe for the cookbook as an extension of her support for the Children’s Miracle Network charity. Georgia credit unions have supported the efforts of CMN since 1999. There are six Children’s Hospitals in Georgia. “The support we have received from Georgia credit unions over the years has been phenomenal,” says Terilyn Walton, program coordinator at Children’s Healthcare Atlanta. “The monies contributed from this cookbook fundraiser will go a long way to help treat the thousands of children who come through our doors each day.”

Second-quarter debit transactions are up

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MADISON, Wis. (8/11/08)--MasterCard and Visa both reported that debit transactions were up in the second quarter, which is good news for credit unions, according to the Credit Union National Association (CUNA). U.S. Visa debit cardholders initiated 4.9 billion ATM and purchase transactions during the second quarter, up from 4.24 billion during the same period last year--a 15.6% increase (ATM & Debit News Aug. 7). While the U.S. economic downturn has reduced credit card purchases, spending in other areas, including debit, remains strong, Joseph W. Saunders, Visa chairman/CEO, told analysts during a recent conference call (ATM & Debit News). MasterCard transactions initiated in the U.S. totaled 1.9 billion in the second quarter, up from 1.6 billion for the same period last year--an 18.8% increase. CUNA’s Credit Union Service Profile for 2007 indicates that 94.5% of credit unions nationwide offer ATM cards. How does the increase in debit transactions affect credit unions? “This is good news for the credit union industry, assuming there is increasing debit usage and decreasing credit usage,” Doug Benzine, CUNA vice president of research and advice, told News Now. “If people are not adding to their debt load, that’s a good thing for credit union members. “In this economy, a lot of people are watching what is happening to the debt load overall,” he added. “If members are trying to stay within their means and put money away as the economy moves through tough times, that’s a good development.”

Thousands in Kentucky receive vish scam targeting CU

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FRANKFORT, Ky. (8/11/08)--A state official issued a warning in the aftermath of thousand of Kentuckians receiving scam recorded phone calls last week claiming their credit cards had been suspended and their accounts at Commonwealth CU frozen. Attorney General Jack Conway said the calls are a scam and that state investigators received many complaints. They confirmed with Commonwealth CU that the calls are a hoax intended to compromise members’ accounts. He told Kentucky citizens not to respond to the calls. (US Fed News Aug. 7). The bogus message asks people to call a toll-free number and enter their credit card numbers to reactivate their accounts. Members of the $717.4 million asset, Frankfort, Ky.-based credit union and nonmembers reported receiving the calls on their home, work and cell phones.

CU System briefs (08/08/2008)

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* WEST COVINA, Calif. (8/11/08)--Three armed men in ski masks and mittens robbed a branch of First City CU Los Angeles Thursday after wrestling with a security guard for his gun, according to news reports (Daily Bulletin.com and Pasadena Star-News Aug. 7). No one was injured. The take-over heist occurred at 9:30 a.m. while at least 10 people were in the credit union. The three men ordered everyone to the ground and told a staffer to open the vault. When she explained she couldn't open it, the men emptied the cash registers and fled in a gold car. The branch is located in a busy shopping center next to Wescom CU … * FARMERS BRANCH, Texas (8/11/08)--Two Texas credit union chapters--the Fort Worth Chapter and Big Spring Chapter--were named the 2007 Chapters of the Year by the Texas Credit Union League, the league announced Friday (LoneStar Leaguer Aug. 8). Three additional chapters--Texoma, Dallas and Austin--were also recognized as Star Award performers. Chapters are judged in seven categories: education, credit union fundraising, public relations, chapter involvement, community activism, participation in the credit union system and political advocacy … * NEW YORK (8/11/08)--Two community development credit unions are semifinalists in the 2008 Wachovia NEXT Awards for Opportunity Finance, which recognize excellence among community development financial institutions that responsibly serve low-income and low-wealth people and communities. ASI FCU, Harahan, La., and Lower East Side Peoples' FCU, New York, N.Y., are among the 10 semifinalists. They are not in direct competition with each other because they are in different categories, based on their lending activities. ASI FCU is competing in the more than $50 million in lending capital category while LESPFCU is in the $10 million-$50 million in lending capital. The announcement was made by the National Federation of Community Development Credit Unions … * LAHAINA, Hawaii (8/11/08)--Lahaina FCU members will vote on whether to merge the $6.6 million asset credit union with the $77 million asset, Kahului-based Valley Isle Community FCU. The final tally will be announced at a special membership meeting on Aug. 16, said Lahaina FCU (The Lahaina News Aug. 7). Its board already has voted in favor of the merger, and the credit union has obtained permission to proceed with the merger process from the National Credit Union Administration. Through the merger, Lahaina's members will receive higher dividend rates on savings, access to more than 30 shared branches and a network of 500 surcharge-free ATMs as well as more products and services, the two credit unions said … * DENVER (8/11/08)--The Credit Union Foundation of Colorado and Wyoming has awarded a $5,000 Brayman-Beach scholarship to Ericca McCutchen, a member of Bellco CU based in Greenwood Village. McCutchen is shown, at left, with Susan J. Brayman. The award, named for Brayman and Carroll D. Beach, is awarded to undergraduate credit union members pursuing a business degree. McCutchen will enter her sophomore year at Denver University as an International Business major with a Public Policy and Leadership minor. She plans to go to law school. (Photo provided by the Credit Union Foundation of Colorado and Wyoming) …

Membership Growth Series Generations FCU

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SAN ANTONIO (8/11/08)--Participation in the Volunteer Income Tax Assistance (VITA) program and increased emphasis on print and broadcast advertising over the past several years has led to solid membership growth for Generations CU, a $316 million asset, San Antonio-based credit union. The credit union realized 7% membership growth from 2006 to 2007. Anyone who lives, works, attends school, worships or volunteers in Bexar County, Texas, is eligible for membership. This is the seventh installment of the News Now Membership Growth series of interviews with fast-growing-membership credit unions. The series is part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. The series focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA's Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. “One of the primary growth engines for our credit union has been the VITA program,” Eve Hernandez, Generations vice president of marketing, told News Now. “Not only has it brought in new members, but it also has been part of the commitment from our board to serve the underserved. So it fulfills our growth strategy and serves low- and moderate-income members.” In 2004, Generations significantly stepped up print and broadcast advertising efforts. In 2005, the credit union began to see a return on the investment--not only from advertising but also from the VITA program, Hernandez said. Earlier this year, the credit union changed its name from San Antonio City Employees FCU to Generations FCU. “Those three things [VITA program, advertising, name change] improved recognition, and awareness of our credit union helped our membership growth,” Hernandez explained. Generations specifically targets the 18-34 age group, Hispanics, immigrants and African Americans. Hispanics are a majority population in San Antonio, Hernandez noted. While Generations sees that other financial institutions target 18-34 year olds because they are less educated on financial products and services, the credit union targets this group to provide products that are more easily understandable. Two such products are: the Alternative Refund Anticipation Loan sponsored by the Internal Revenue Service (IRS) through the VITA program, and the Second Chance Checking Program. With the Alternative Refund Anticipation Loan, the credit funds a 0% annual percentage loan once it gets IRS confirmation of the member’s tax refund. The Second Chance Checking Program is geared toward members who have had past financial difficulties. There are several parameters affixed to the program, Hernandez said, including: Participants are limited to 10-15 checks per member, they can incur no non-sufficient funds fees, they must attend financial literacy classes and they must pay off any balances that they owe merchants. “Once members are successful with the second chance program, they can migrate to a traditional checking program,” Hernandez explained. Generations targets 18-34 year olds because it is the credit union’s mission, Hernandez said. “We can make a real difference for them,” she added. “We see a lot of young families and we see a lot of individuals using non-traditional financial services, so their income is chipped away by high-interest loans, money orders and check-cashing places. “By providing traditional financial services to help them, we’re turning that relationship into a more long-term and beneficial one. A lot of the parents of these members always used cash, so they don’t understand direct deposit, and different financial products and services offered,” she said. An example of a product that helps this younger group is an alternative to payday loans that charges an 18% interest rate, and is a more traditional, humane loan, Hernandez said. Generations became a community credit union in 2006, serving residents of Bexar County after starting out as a credit union for municipal employees in 1940. Hernandez explained the reasoning behind the charter change. “We found that the credit union was very successful having its roots as a good community service for city employees,” Hernandez said. “Our board of directors is really dedicated to providing public service--bringing down interest rates on loans, as well as debt consolidation and interest-rate relief. We looked for ways to extend our positive influence on the community.” Between 2001 and 2006, before the switch to a community charter, the credit union was part of a National Credit Union Administration program called Investment Area. Under the guidelines of the program, the credit union could serve census tracts--based on income level--within three-and-a-half miles of each credit union branch for members who earned 80% or less of the median income in the area. “That program was so confusing and cumbersome to manage,” Hernandez said. “That’s one of reasons we switched to community charter, so we could more easily serve the underserved in our area.” For credit unions, there always has to be a balance between getting new members and deepening that relationship with new members, Hernandez said. “While membership growth is good, we want to build relationships with members early on and retain them for as long as possible,” Hernandez explained. “To serve the underserved, you need a board commitment to do that. You have to take some risk on the loan side. My hat is off to our board for doing that. That comes from our VITA and Second Chance Checking programs.” Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at cunamgtf@cuna.coop.

CU in Texas tells how it weathered hurricane

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HARLINGEN, Texas (8/11/08)--When Hurricane Dolly hit July 23, residents and businesses in Harlingen and Pharr, Texas, were left without power. But Security Service FCU, Harlingen, was open and ready for business the day after the storm hit.
Click to view larger image Security Service FCU, Harlingen, Texas, opened the next day to serve members after Hurricane Dolly hit the area. From left are its Disaster Response Team employees: Manager James Ayala, David Marin, Julian Alcorta and Feliz Cavazos. (Photo provided by Security Service FCU)
The credit union relied on a generator installed at the credit union’s service center. Manager James Ayala ran the credit union by himself the first day after the hurricane, and was able to get additional staff at the Harlingen and Pharr branches soon after. “We were able to get our computer systems booted up and connected to the corporate system thanks to the generator, but we had no air conditioning and we were pretty much in the dark because the windows were still boarded up,” he said. Ayala said it was important to open the locations because he knew members were going to need access to cash to buy gas and groceries. By the weekend, the credit union managed to get everything back to normal, including the air conditioning. “I’m really glad we had the capability to operate so that we could help our members during this difficult time,” he said. Security Service also put together a disaster relief program to help members affected by the storms. The credit union is offering emergency relief loans up to $2,500 for new and existing members, with a 30-day skip-payment option without fees. After one week, Security Service issued 126 loans and granted 36 skip-payment requests. Security Service has more than $4.6 billion in assets.

OpSS Council conference focuses on leadership

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MADISON, Wis. (8/11/08)--Credit union professionals will learn what to focus on to build stronger, more successful industry leaders with a general session presentation at the 11th annual CUNA Operations, Sales and Service (OpSS) Council Conference, Sept. 17-20 in Williamsburg, Va. In his presentation, Mark Elliott, president, Onboarding Services, will discuss “The Leadership That Really Determines Success.” Tapping 25 years of experience in executive recruitment and coaching, Elliott will share what makes great leaders. He also will debunk several myths that often confuse the leadership development process and offer a practical approach for leadership development. During the “You Have the Power” general session presentation, consultant Carol Schillios will focus on how to take charge and make choices to achieve goals. Motivational speaker Steve Sobel will offer the keys to building enduring relationships and enjoying future opportunities in his “Leadership and Life Lessons” presentation. The conference also includes a number of other sessions covering: growth strategies, hot topic compliance issues, generating deposits, branch delivery efficiency, sales culture development, call centers, social engineering and fraud, and more. For more information, use the link.