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Home-state visits connect lawmakers, CU members

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MADISON, Wis. (8/29/14)--Credit unions reported several productive home-state visits with lawmakers this week.
 
Click to view larger image U.S. Rep. Mark Meadows (R-N.C.) greets members of the Carolinas Credit Union League's Western Chapter on Tuesday. (Carolinas Credit Union League Photo)
Meeting with lawmakers while they are in their districts is a critical part of the Credit Union National Association's advocacy strategy, Ryan Donovan, CUNA senior vice president of legislative affairs, told News Now.

"It reinforces the local presence credit unions have in virtually every community in the country, and frankly, some of our more productive meetings with representatives and senators take place back home because members have more time to meet with their constituents and understand their concerns," Donovan said.
 
On Tuesday, the Carolinas Credit Union League's Western Chapter hosted an event featuring Rep. Mark Meadows (R-N.C.) in Asheville, N.C., attended by more than 80 credit union representatives (In the Loop Aug. 29)
 
Click to view larger imagePatti Seymore, vice president at SC Telco FCU, Greenville, S.C., and U.S. Rep. Jeff Duncan (R-S.C.) (Carolinas Credit Union League Photo)
"Your members trust you--and having someone you can trust when making important financial decisions is important," Meadows told attendees.
 
Currently serving his first term in the U.S. House of Representatives, Meadows reiterated his support for the credit union tax exemption and shared his concerns about the overregulation credit unions are facing as a result of the passage of the Dodd-Frank Act.
 
"Many of our credit unions that have been to Washington, D.C., or met individually with Congressman Meadows over the past year have come to appreciate his strong support for credit unions," said Dan Schline, league senior vice president of association services. "Tonight was important because a wider group of western North Carolina credit unions got to hear firsthand about that support."
 
Click to view larger image U.S. Rep. Joe Wilson (R-S.C.) speaks with credit union advocates from the Carolinas Credit Union League's Columbia Chapter. (Carolinas Credit Union League Photo)
In addition to signing a joint letter from members of the House of Representatives to National Credit Union Administration Chair Debbie Matz in June, Meadows authored his own letter this month expressing concerns about the agency's risk-based capital proposal.
 
U.S. Rep. Jeff Duncan's (R-S.C.) fourth annual Faith and Freedom BBQ drew more than 1,100 attendees Monday. Special guests included Gov. Nikki Haley, Sen. Marco Rubio (R-Fla.), Sen. Lindsey Graham (R-S.C.) and South Carolina Attorney General Alan Wilson. Credit union advocates from the 3rd District attended a private reception prior to the event and were able to meet with elected officials to discuss credit union issues.
 
Missouri credit union leaders met with U.S. Rep. Sam Graves (R-Mo.) this week. From left: Jay Neathery, executive vice president, United Consumers CU, Independence, Mo.; Rick Schier, vice president of sales and service, CommunityAmerica CU, Lenexa, Kan.; Ron Miller, president, Edison CU, Kansas City; Graves; Dennis Pierce, president/CEO, and Pat Yokley,  chief operating officer, CommunityAmerica CU; Don Cohenour, president/CEO, Missouri Credit Union Association; and Chris McCreary, president, United Consumers CU. (Missouri Credit Union Association Photo)
The Carolinas Credit Union League, along with the Columbia Chapter of Credit Unions, hosted longtime credit union supporter Rep. Joe Wilson (R-S.C.) on Tuesday in Columbia, S.C., for a BBQ "Meet and Greet." Credit union members throughout the midlands had the opportunity to speak with Wilson and his staff, in addition to celebrating credit unions' national 100 million memberships milestone.

U.S. Rep. Sam Graves (R-Mo.) reaffirmed his support for maintaining the credit union tax status when he met with Missouri credit union leaders this week, the Missouri Credit Union Association reported.  The meeting took place Monday at CommunityAmerica CU's North Oak Trafficway branch in Kansas City, Mo.  During the meeting, credit union leaders stressed the importance of the credit union tax status when discussing the possibility of tax reform in the next Congress.
 
Graves, who had served as chairman of the House Small Business Committee, asked about the impact of data breaches on credit unions.
 
In addition to the league and Lenexa, Kan.-based $1.9 billion-asset CommunityAmerica CU, participants in the meeting included Edison CU, Kansas City, Mo., with $29 million in assets; and United Consumers CU, Independence, Mo., with $123 million in assets.

CU System briefs (08/29/2014)

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  • WATERLOO, Iowa (8/29/14)-­- Jean Trainor, CEO and chief inclusion office of Veridian CU, Waterloo, Iowa, announced her departure from the $2.4 billion-asset credit union . Trainor has been with the credit union for 32 years, serving as the CEO for 25 years. She is taking on a new career to help her 29-year-old son--who has a rare disorder that leaves him unable to speak--train others to communicate via keyboard as he has been doing for eight years. Trainor told the Waterloo Cedar Falls Courier that she had decided helping Nate take on this task would be her next career (Aug. 28) ...
  • CHARLESTON, W. Va. (8/29/14)-- Pioneer West Virginia FCU, Charleston, W.Va., announced Dan McGowan will succeed Dana Rawlings as president/CEO when Rawlings retires at the end of September . McGowan currently is the executive vice president/chief financial officer of the $179 million asset-credit union ( Charleston Gazette Aug. 27). Under Rawlings' tenure, the credit union rebranded, completed three mergers and expanded its field of membership to 10 counties in West Virginia, Kentucky and Ohio ...

Branch contact still important, says CU satisfaction index

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ANN ARBOR, Mich. (8/29/14)--The importance of branches to members continues to see-saw, according to the CFI Group's latest Credit Union Satisfaction Index (CUSI). Potential members see them as a key reason to join a credit union. Current members appreciate the way they are treated at their branch but are looking for new channels such as mobile for service.
 
Click to view larger image CFI Group Graphic
In the second installment of its CUSI, CFI Group found that the branch experience continues to be highly rated at 92--"a reflection of members' ongoing delight with the way they are treated."
 
At 31%, branch convenience remains a high point for why a member chooses a credit union. Once part of the fold, the member shifts focus to other satisfaction factors such as mobile access or new products.
 
"As our lives are becoming increasingly technology-centric, it is only natural for members to desire access to their accounts remotely," said Terry Redding, CFI Group vice president of sales and marketing. "Even though the vast majority of members are using online and mobile banking, members still want the convenience of a nearby branch, exceptional service and the ability to access their accounts in-person if they choose to do so."
 
Expanding the ATM branch experience may fill members' needs. The report notes that there is a genuine appetite for ATM services such as paying credit card bills (38%), making a loan payment (30%), purchasing a CD (29%) and opening an account (28%).
 
Members' desire for online and mobile services continues to grow across all age ranges, which designers need to take into account. The report noted, "Applications that work well for eagle-eyed and text-savvy young people may not have the same appeal to their perhaps 'fatter-fingered' and glasses-wearing parents."
 
The CUSI model looks at six satisfaction drivers: products and services, information and communications, branch staff, branch convenience, rates and fees, and online and mobile banking.
 
Overall member satisfaction is strong at 86--a decline from 90 in the 2013 inaugural report--but banks ticked up one point to 80 from 79 in CFI's Bank Satisfaction Barometer report.

CUNA closed for Labor Day, No News Now

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WASHINGTON and MADISON, Wis. (8/29/14)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Monday in observance of Labor Day.
 
There will be no Monday edition of News Now . News Now will resume regular publication on Tuesday.

World Council encourages charity focus for ICU Day

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MADISON, Wis. (8/29/14)--International Credit Union (ICU) Day's theme of "Local Service. Global Good." gives credit unions a chance to make a difference for the charity of their choice, noted the World Council of Credit Unions.
 
With that in mind, the World Council is encouraging fundraising this year. Each country will be asked to report charitable donations leading up to and throughout ICU Day, which is Oct. 16.
 
The World Council will capture the results and share a global report on credit union fundraising efforts at the community, national and international levels.
 
It suggests a number of campaigns, including:
  • Fundraising events with social media coverage;
  • In-branch coin drives;
  • Corporate matching and office fundraising challenges;
  • Credit union interchange fees for all card transactions;
  • Add-on donation options for members to make through debit/card transactions; or
  • Crowdfunding websites.
In the United States, Credit Unions for Kids will hold Shop for Miracles, a one-day fundraising program to support local Children's Miracle Network Hospitals. Each time members use their credit union-issued credit or debit card on Oct. 16, participating credit unions will donate a pre-determined amount to their local children's hospital.
 
The World Council also encourages credit unions to engage with members on Facebook and Twitter with the #ICUDay hashtag.

No bogies: CU golf tourneys raise $172,000

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MADISON, Wis. (8/29/14)--Summer is a perfect time to hit the links, and credit unions take the opportunity to turn the greens into gold for their charities of choice.
 
Youth financial education is the beneficiary of $41,000 raised by 96 players and 21 sponsors at the Richard Myles Johnson Foundation/CUNA Mutual Golf Tournament, held Aug. 18 in Newport Beach, Calif.
 
Service 1st FCU, Danville, Pa., raised $30,000 during its 21st annual golf tournament last Friday for the Janet Weis Children's Hospital, Nolan's Heart of Steel and Montour County Veterans Affairs. (Service 1st FCU Photo)
"The funds from this year's successful RMJ/CUNA Mutual Golf Tournament will go a long way toward funding the Bite of Reality, our youth financial education program, which has reached more than 3,500 teens in California and Nevada since its inception in 2012," said Tena Lozano, executive director of the Richard Myles Johnson Foundation.
 
With a turnout of 130 golfers and 23 sponsors, the Ohio Credit Union Foundation Classic raised $41,000 Aug. 11. The foundation will use the funds to support credit union financial education, outreach projects, professional development and disaster relief needs in 2015 ( eLumination Aug. 20).
 
The Massachusetts Credit Union League's charity golf tournament benefited the Massachusetts Coalition for the Homeless to the tune of $27,000 ( Daily CU Scan Aug. 27). During the Monday event, Lois Ferraresso, the coalition's associate director, thanked the 100 golfers and event sponsors for their support.
 
The Utah Credit Union Association raised about $10,000 for scholarships to Western CUNA Management School with its KSL Golf Tournament ( Association Update Aug. 12).
 
Service 1st FCU, Danville, Pa., raised $30,000 during its 21st annual golf tournament last Friday for the Janet Weis Children's Hospital, Nolan's Heart of Steel and Montour County Veterans Affairs. "Occasionally, I have veterans who fall into an unfortunate financial crisis through no fault of their own," said Douglas Resseguie, Montour County Veterans Affairs director. "This money will go a long way in helping deserving veterans get back on their feet with some short-term emergency assistance." In addition to the golf tournament, the $233 million-asset credit union held a duck derby as part of its #DoGood campaign.
 
Erie, Pa.-based Widget Financial FCU's sixth annual Million Dollar Golf Shoot Out raised more than $23,700 for Charities for Children Inc., which supports 14 charities in the Erie area ( Life is a Highway Aug. 28). Approximately 107 golfers and more than 120 individuals attended the Aug. 18 event. Combined with its annual bowling tournament, the $264 million-asset credit union has donated $52,555 in 2014 to Charities for Children.

CU responds with relief, loan program after Napa quake

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NAPA, Calif. (8/29/14)--Redwood CU (RCU), Santa Rosa, Calif., with $2.3 billion in assets, is accepting contributions and offering loan assistance for those affected by Sunday's Napa area earthquake.

All of RCU's 17 branch locations and local call center have been designated as collection sites for the American Red Cross relief fund to assist those affected by the earthquake.
 
"Our hearts go out to everyone affected by the earthquake, and we want to help however we can," said Brett Martinez, RCU president/CEO. "Accepting monetary donations through our branches and call center makes it easy and convenient for our members and local community to support the American Red Cross relief efforts."
 
The credit union also is offering special assistance to residents in the Napa area who have been affected financially by the recent earthquake, including an interest-free earthquake relief loan of up to $5,000 for 12 months to help with unexpected expenses resulting from Sunday's earthquake. Other types of loans are also available to assist local residents and businesses with earthquake-related financial issues.
 
"When natural disasters occur, many people find themselves burdened by unexpected expenses that can cause financial distress," Martinez said. "We are offering assistance through these loans to give local earthquake victims peace of mind so they can resume their normal lives as they recover from this unfortunate event. We're here to help."

Kresge grants support unbanked efforts by CUs, social agencies

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ST. LOUIS (8/28/14)--Three credit unions are wrapping up their first year of financial capability partnerships with human services agencies made possible through a $530,000 grant from the Financial Capability Partnership Initiative.  
 
The initiative, managed by the National Federation of Community Development Credit Unions and the Center for Financial Services Innovation, promotes healthy financial alternatives for low-income individuals and families. Support for FCPI is provided by the Kresge Foundation.

"Problems faced by vulnerable populations require a variety of interventions. We believe the Financial Capability Partnership Initiative will help people become more integrated into the financial system and provide the tools to help them become self-sufficient," said Kimberlee Cornett, managing director of Kresge's Social Investment Practice.
 
St. Louis Community CU, with $245 million in assets, works with Kingdom House, an agency that provides social services in St. Louis, to make financial education and affordable financial products available to the agency's clients.
 
The credit union operates mini-branches in Kingdom House and in other social service agencies, making it convenient for clients to receive one-on-one financial counseling and learn about banking services. Kingdom House social workers include financial assessments in their annual client interviews, and one is trained as a personal finance specialist.
 
St. Louis Community CU's presence helps fill a gap in a neighborhood that is considered a financial institution "desert," said Scott Walker, Kingdom House executive director.
 
In Chicago, the Community Builders and South Side Community FCU, with $3 million in assets assists income-earning residents of a Work First Community Housing property with direct financial coaching and access to responsible financial products.
 
In San Francisco, Self-Help FCU, based on Raleigh, N.C., with $560 million in assets, works with the Mission SF Community Financial Center to offer financial coaching and credit union products to low-income 18- to 24-year-olds who are part of a skills-development program that includes college credit and corporate internships.
 
The Center for Financial Services Innovation and the federation have also provided support to credit unions and social service agencies in Cleveland; Durham, N.C.; New Orleans; and San Antonio.

CU System briefs (08/28/2014)

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  • SUITLAND, Md. (8/28/14)--Next week, Andrews FCU, Suitland, Md., will join the Steak Team Mission for the first of its three fall events that provide steak dinners to servicemembers around the world. The $1 billion-asset credit union will bring the second Steak Team Mission to Mons, Belgium, for 600 servicemembers for a Labor Day celebration Wednesday. The following week on Sept. 9, the credit union will host a dinner for all military attaches assigned to Paris at the U.S. ambassador's residence. And, in honor of Veterans Day in November, a steak mission will be held in the Sinai Peninsula for the 2,000 soldiers serving there as part of the multinational peacekeeping mission. Since 2002, Steak Team Mission has prepared and served more than 50,000 steak dinners with all the trimmings. "There is never enough we can do in support of our troops," said Jim Hayes, Andrews FCU president/CEO. "This contribution is just our way of saying thank you for all that you do." ...
     
  • GLENDORA, Calif. (8/28/14)--Sen. Roger Wicker (R-Miss.) selected Mendell Thompson, president/CEO, America's Christian CU, Glendora, Calif., as a 2014 Angels in Adoption awardee for his advocacy of adoption efforts. The Congressional Coalition on Adoption Institute honor is an opportunity for congressional delegates to recognize their constituents' work on behalf of foster children and orphans. The $284 million-asset credit union has helped place more than 1,000 children with families through its adoption loan program, which helps cover adoption costs such as travel to foreign countries ...

CUNA offers 'Must-know Mondays' for directors

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MADISON, Wis. (8/28/14)--The Credit Union National Association has announced a new seven-part webinar series that satisfies the yearly training requirements of credit union directors.
 
"Must-know Mondays--Required Training for Directors" will explore topics that credit union directors are required to revisit year after year, each sprinkled with humor and insights from presenter David Reed, a speaker and facilitator who has served as both an outside attorney and an in-house credit union general counsel.
 
Each session will also give attendees the opportunity to ask questions or make observations of their credit unions' situation gain additional insight into each topic.
 
"As our industry becomes more complex, credit union directors are held responsible for more and more ongoing training each year," said Lynne Bjorgo, CUNA manager of learning events. "Rather than ask them to track down each training requirement individually, we're assembling one comprehensive package and covering one topic each month from now until spring."
 
Session dates and topics include:
  • Sept. 29: Board Governance Refresher;
  • Oct. 20: Everything You Always Wanted to Know About Director's Bond Coverage;
  • Nov. 17: The Ins and Outs of the Bank Secrecy Act for Directors and Volunteers;
  • Dec. 15: What a Director Needs to Know About Fair Lending;
  • Jan. 26: Creating a Transparent Board--Understanding and Dealing with Conflicts of Interest;
  • Feb.16: Examination Guidance for Directors; and
  • March 23: The Director's Guide to Effectively Working with the Supervisory Committee.
Recordings of each session are included with the webinar series.

Ga. members lend voices to 100M membership video

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DULUTH, Ga. (8/28/14)--The Georgia Credit Union Affiliates highlighted the credit union movement's 100 million memberships milestone recently by recording interviews with members of Georgia United CU who described in their own words what consumers like best about credit unions.
 
The $981 million-asset credit union in Duluth was the impromptu stage for GCUA's Jason Golden, who asked members, "What's the one thing you love the most about your credit union?"
 
Auto loans, member service, shared branching, low rates and convenience, the members responded.
 


One member even shared his experience of improving his financial standing. "They gave me a lot of good advice on how to help my credit and build my credit. I'm looking really good credit-wise because of them," he said.
 
"It's a little more hometown, and a little more personal," another said. "I think they are just a little bit more about the individual."
 
The video is only part of GCUA's celebration of the movement's milestone. On Monday, the league will select the winner of its Facebook selfie contest. Contestants shared a photo of themselves on GCUA's creditYOUnion Facebook page with the #100MM hashtag for a chance to win $100.
 
GCUA also encouraged members to upload their photos to the national 100 million memberships site, americascreditunions.org.

$5 coffee? Cash or card depends on age, says CreditCards.com

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MADISON, Wis. (8/28/14)--Consumers, especially the younger generation, are using credit and debit cards for the smallest of purchases, such as cups of coffee and packs of chewing gum, according to a new survey by CreditCards.com.

About 1 in 3 consumers typically use a credit card or a debit card for in-person purchases of less than $5, according to a national telephone survey of 983 adult U.S. credit card holders. Roughly 11% prefer credit cards, 22% use debit cards, and 65% still pay with cash.

The penchant for plastic is stronger with the 18- to 29-year-old demographic. About 51% of consumers in that category prefer plastic to cash, the only age group to do so. A preference for cash becomes stronger in each advancing age bracket, until at age 65-plus, 82% prefer cash.

The younger consumers are, the more likely they are to reach for a card. Among consumers 49 years old and under, 52% prefer cash, and 46% prefer debit or credit cards. Among those 50 or older, 77% still prefer cash, with 21% reaching for debit cards or credit cards.

Those who graduated from or attended college are more comfortable than others using plastic for small purchases.

A combined 39% of those with college degrees prefer debit cards (21%) or credit cards (18%) over cash (59%). Only 16% of those who have not attended college usually use debit cards for purchases of less than $5, along with only 6% who prefer credit cards for that purpose.

Consumers with full-time jobs were more likely to use credit cards and debit cards for small purchases (42%) than those employed part time (34%) or than those who were unemployed (23%). People with children are more likely to use the cards for small purchases (41%) than those without children (30%).

State leagues bestow social responsibility awards on CUs

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MADISON, Wis. (8/28/14)--Three state credit union leagues recently announced their winners of credit union philosophy and financial education awards.
 
The Dora Maxwell Social Responsibility Community Service Award is given to a credit union or credit union group for external activities supporting social responsibility projects within the community.
 
The Louise Herring Philosophy in Action Member Service Award goes to a credit union for its practical application of credit union philosophy to internal programs and services that benefit membership.
 
The Desjardins Youth and Adult Financial Education Awards honor credit union efforts for personal finance education of members and nonmembers.
 
The deadline for states to submit winners to the Credit Union National Association for national consideration is Friday.
 
During its recent annual convention, the Louisiana Credit Union League presented its awards to the following credit unions.
 
Desjardin youth financial literacy awards went to:
  • Less than $200 million: Lafayette (La.) Schools FCU, with $173 million in assets; and
  • More than $200 million: Barksdale FCU, Bossier City, with $1.1 billion in assets.
Desjardin adult financial literacy awards were bestowed on:
  • Less than $200 million: Greater New Orleans FCU, Metairie, with $116 million in assets; and
  • More than $200 million: Neighbors FCU, Baton Rouge, with $670 million in assets.
Ouachita Valley FCU, West Monroe, with $176 million in assets, received the Louise Herring award. The Dora Maxwell award went to Lafayette Schools FCU, in the less than $200 million-asset category, and Neighbors FCU, in the more than $200 million-asset category.
 
The Minnesota Credit Union Network released its list of winners from 27 credit unions that submitted entries this year.
 
Winners of the Dora Maxwell award, by asset size, are:
  • $20 million-$50 million: Star Choice CU, Bloomington, with $47 million in assets;
  • $100 million-$200 million: Lake State CU, Moose Lake, with $188 million in assets;
  • $200 million-$500 million: Richfield-Bloomington CU, Richfield, with $258 million in assets; and
  • $500 million-$1 billion: SPIRE CU, Falcon Heights, with $626 million in assets.
Minnesota's Louise Herring award winners, by asset size, are:
  • Less than $50 million: Star Choice CU;
  • $250 million-$1 billion: TopLine FCU, Maple Grove, with $352 million in assets; and
  • More than $1 billion: Affinity Plus FCU, St. Paul, $1.7 billion in assets.
Winners of the Desjardins youth financial education award, by asset size, are:
  • Less than $50 million: Cook Area CU, Cook, with $29 million in assets;
  • $50 million-$150 million: United Educators CU, Apple Valley, Minn., with $151 million in assets;
  • $150 million-$500 million: TopLine FCU; and
  • More than $500 million: Wings Financial CU, Apple Valley, with $4 billion in assets.
Desjardins adult education awards went to $153 million-asset Great River FCU, St. Cloud, in the $150 million to $500 million-asset category; and $950 million-asset Hiway FCU, St. Paul, in the more than $500 million-asset category.
 
Top achievers from the League of Southeastern Credit Unions (LSCU) also were announced this week.
 
LSCU's Dora Maxwell award winners, by asset size, are:
  • $100 million-$200 million: PBC CU, West Palm Beach, Fla., with $123 million in assets;
  • $200 million-$500 million: First Commerce CU, Tallahassee, Fla., with $400 million in assets;
  • $500 million-$1 billion: Alabama CU, Tuscaloosa, with $640 million in assets; and
  • More than $1 billion: CFE FCU, Lake Mary, Fla., with $1.4 billion in assets.
The Louise Herring award went to $1.2 billion-asset Pen Air FCU, Pensacola, in the more than $1 billion-asset category.
 
Desjardins youth financial education awards went to $43 million-asset Tallahassee-Leon FCU, Tallahassee, Fla., in the less than $50 million-asset category; $407 million-asset Legacy Community FCU, Birmingham, Ala., in the $150 million to $500 million-asset category; and $5.7 billion-asset Suncoast CU, Tampa, Fla., in the more than $500 million-asset category.
 
In the more than $500 million-asset category, the Desjardins adult education award went to Army Aviation Center FCU, Daleville, Ala., with $1.1 billion in assets.

Council white paper: Psychographics discover 'why' of purchases

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MADISON, Wis. (8/28/14)--Marketers may know the "who" and "where" of their target market, but it's the elusive "why" that will key them in to what people buy and use.
 
A new white paper from the CUNA Marketing and Business Development Council looks at psychographics, which classifies people based on lifestyles, attitudes, habits, interests and opinions opposed to geographic data ("where") and demographics ("who").
 
The power of psychographics allows credit union marketers to build better connections with members by getting inside their heads and understanding how they think and what is important to them.
 
Psychographics helps marketers understand what will grab members' attention and, more importantly, what may turn them off, the paper noted.
 
How can a credit union discover its members' distinct voices? Begin by asking them five questions, the paper advised:
  • What made you decide to join/do business with us?
  • What do you like about our competitor and their product?
  • What are your interests, hobbies, and pastimes?
  • Are you extroverted or introverted? Are you analytical or emotional?
  • What kind of environment do you thrive in?
Psychographics brings a personal and emotional connection to the relationship. FAA CU, Oklahoma City, with $563 million in assets, collected data from its core processing, marketing customer information file and customer relationship management programs.

Instead of a sweeping communication, the credit union created personalized URLs to give members with a free credit score analysis. By focusing on member service, the credit union and its See Your Score Soar campaign saved members more than $10 million over 18 months (News Now May 12).
 
Use the resource link to access "The Power of Psychographics: Segmented and Targeted Marketing Strategies."

'Minnesota Minded:' Membership message hits the road

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ST. PAUL, Minn. (8/27/14)--The Minnesota Credit Union Network (MnCUN) Monday introduced "Minnesota Minded," a report about the growth Minnesota credit unions have experienced since the financial crisis.
 
Click to view larger image Click to enlarge.
That growth includes the addition of more than 100,000 new members in two years and an increase in nearly every measurement of credit union strength.
 
Nationally, the Credit Union National Association announced that credit unions had surpassed 100 million memberships in June.
 
"Minnesota Minded" is designed to illustrate the significant trust that consumers have placed in Minnesota credit unions, which hold over $19 billion in assets and serve more 1.6 million Minnesotans at over 400 locations.
 
To roll out "Minnesota Minded," MnCUN held a press event on Monday, featuring the community involvement and financial education initiatives led by Affinity Plus FCU, St. Paul, with $1.7 billion in assets, and Wings Financial FCU, Apple Valley, with $4 billion in assets.
 
"Affinity Plus and Wings are two great examples of the many ways that credit unions throughout the state work within their communities to build a stronger Minnesota," said Mark D. Cummins, MnCUN president/CEO. "Every day credit unions help create a brighter financial future for their members and their communities."
 
Financial education for youth is a vital component of credit unions' commitment to serving members and communities. "It's important for youth to build financial skills," said Frank Weidner, Wings Financial FCU president/CEO. "In 2014, Wings is partnering with schools throughout Minnesota to teach more than 5,000 students about the basics of financial education, along with the impact that social media and identity theft can have on their future higher education and employment opportunities."
 
"Minnesota Minded" showcases which illustrates that credit unions are Minnesotans' trusted, local financial partner and that credit unions are closely connected to the communities they serve.
 
Affinity Plus makes a difference in its community with "Plus it Forward," a program designed to inspire people to perform intentional acts of kindness.
 
"Being involved in communities is a top priority, and we engage with our 181,000 members to assist in giving back to Minnesota charities," said Dave Larson, Affinity Plus president/CEO. "A great example is our Plus it Forward initiative. On Columbus Day (Oct. 13) Affinity Plus will be out in our communities spreading kindness by doing things like raking leaves for senior citizens and supporting military members and their families."

Additional "Minnesota Minded" press events are scheduled for Brainerd and Rochester in  upcoming weeks.

CU System briefs (08/27/2014)

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  • WICHITA, Kan. (8/27/14)--The Kansas Credit Union Association (KCUA) announced 21 credit union professionals earned their financial counselor designation. There are now 43 credit union representatives from 16 credit unions who have completed the Financial Counseling Certification Program, coordinated by the KCUA, the National Credit Union Foundation's REAL Solutions program and the Credit Union National Association ...
     
  • TORONTO and MADISON, Wis. (8/27/14)--The Filene Research Institute has a new benefactor for its Alpha Lab program. Toronto-based D+H, a provider of banking technology, loan processing and payment services, increased its support of the credit union think tank to chairman's roundtable benefactor from bronze supporter. D+H will be the exclusive supporter of Alpha Lab, which develops and assesses high-potential concepts from Filene's i3 (Ideas, Innovation, Implementation) program ...
     

CUNA's fin. management eSchool set for 2 sessions

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MADISON, Wis. (8/27/14)--Starting Thursday, the Credit Union National Association will host a two-part eSchool designed to strengthen the financial decision-making of credit union finance professionals and leaders.
 
"These days, the financial management of a credit union depends on sound decision-making from executives, board members, managers and others," said Brad Covey, CUNA director of blended learning. "This eSchool ensures that anyone responsible for an aspect of their credit union's finances has the know-how to back up their role."
 
Each CUNA Financial Management eSchool will be presented over eight Thursdays. Part 1, which runs Thursday through Oct. 16, offers an introduction to financial ratios, asset-liability management (ALM), investments, forecasting and loan strategy. Part 2, set for Oct. 23 to Dec. 18, develops the ALM process further and includes advanced financial ratios and various risk types.

To register, use the resource links.

Bankrate cites Schenk on 100M membership reach

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NEW YORK (8/27/14)--A Bankrate.com article published online Monday cited credit unions' 100 million membership milestone and highlighted the growth of cooperative financial institutions since the financial crisis. Credit Union National Association interim Chief Economist Mike Schenk was interviewed for the article.
 
"Credit unions are today in a better place than they were four to six years ago,"  Schenk noted. "Credit unions have come through in better shape, relatively speaking, than the banking industry (after the economic downturn)."
 
Much of that momentum was gained in 2011 through the Bank Transfer Day campaign, which urged consumers to ditch their banks in light of moves by some institutions to add new bank fees.
 
"Since that time, it has not only maintained itself but accelerated," Schenk told Bankrate.com of recent credit union growth. "In the wake of the downturn, as banks were hunkering down and licking their wounds and turning people away, credit unions were actually refinancing some of those unfriendly loans that banks made."
 
That relative health has enabled some credit unions to purchase struggling bank branches, the article said. The article noted six instances in which credit unions purchased banks or branch facilities in the past several years.
 
Former customers of those banks may welcome the chance to become credit union members. The article also referenced a February Consumer Banking Insights Study that found lingering resentment among consumers toward big banks over their role in the financial crisis. Two-thirds of Americans say they're still angry at big banks.

Council white paper examines chief lending officer's role

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MADISON, Wis. (8/27/14)--The influence of credit union chief lending officers (CLO) extends beyond lending responsibilities into leadership and business strategy roles, according to a new white paper from the CUNA Lending Council.
 
The CLO helps establish goals in conjunction with the senior leadership team, and those goals are accomplished through the efforts of employees across the organizational chart, according to the white paper, "The Chief Lending Officer: An Examination of the Role and How to Get There." CLOs should be able to get employees excited about their vision, while at the same time, communicate key policy and product details.
 
The paper identifies six reasons why a credit union employee would strive to reach the CLO position.
  • Influence. "If your goal is to be a CLO, make sure you're doing it because of the job itself and not the compensation," said Aaron Bresko, CLO at GTE Financial CU, Tampa, Fla., with $1.6 billion in assets. "I like to protect and develop staff. I'm an advocate for the employees and members, and I really enjoy that. At this level, I have the biggest ability to be able to impact those two things."
  • Salary and benefits. Influence aside, CLOs can can expect a six-figure salary and great benefits. "Salary and benefits are obviously very good," Bresko said. "At this level, the salary is just a given, but what you really need to look at are the retirement plans--the senior executive retirement plans, that have the five-year, seven-year, 10-year buyouts."
  • Challenge. CLOs spend their days working on hard problems without obvious solutions. Leadership decisions are rarely binary. The choices they make have cascading and unanticipated consequences. "I could take a lesser job, have less stress," Bresko said, adding, "I like the challenges. I also like being able to influence all parts of the organization."
  • Professional development. "Something about a role, if it is provocative enough to someone, is going to be developmental," said Bill Lothridge, vice president of human resources at Alliant CU, Chicago, with $8.2 billion in assets. "What the organization needs to be comfortable with is will the foundational expectations and deliverables associated with this role be solidly attended to while talent in the role launches at the developmental stage?"
  • Co-workers. People are the difference between a job you love and a job that's "just a paycheck." Bresko advises, "Make sure you're going to be able to work with the CEO, the board, and that team. You spend a lot of time with them and that can make or break it. Know that you'll be able to make a difference and work well with them."
  • Leadership. "Someone who aspires to be the CLO needs to consider if they would elect to be a leader as a living," Lothridge said. "Most of what they either need to come with or cultivate has, in many respects, and over the long term, little to do with lending."
To download the white paper, use the link.

Six up for Carolinas' inaugural CUaware Protege contest

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COLUMBIA, S.C., and RALEIGH, N.C. (8/27/14)--The six regional chapters of the Carolinas Credit Union League (CCUL) selected their candidates for the inaugural CUaware Protege Competition.
 
"This is our first year of the expanded two-state program, formerly known as the Palmetto Protege Competition in South Carolina," said league President/CEO John Radebaugh. "It's encouraging to see a matched enthusiasm from credit union chapters in both states, and I look forward to the continued growth of this competition."
 
Each candidate completed a standardized exam and will give a presentation from a list of league-approved topics such as credit union philosophy, economics, viability, activism and promotion.
 
The six finalists will vie to be the dual-state Protégé representative at the CCUL Leadership Conference in Pinehurst, N.C., Sept. 5.
 
This year's chapter winners are:
  • Charleston Area: Corey Pace, South Carolina FCU, Charleston, with $1.3 billion in assets;
  • Columbia: Hannah McGee, Palmetto Citizens FCU, Columbia, S.C., with $621 million in assets;
  • Northwest: Jon Hamby, Members CU, Winston-Salem, N.C., with $257 million in assets;
  • Pee Dee: Joshua McKenny, Health Facilities FCU, Florence, S.C., with $25 million in assets;
  • Tarheel: Jenn Moore, Local Government FCU, Raleigh, N.C., with $1.4 billion in assets; and
  • Upstate: Micah Smith, SC Telco FCU, Greenville, S.C., with $266 million in assets.
The protege will serve on the CUaware Leadership Council, and the winner and two runners-up will be awarded a choice of professional development scholarships.

Calif. CUs benefit from reporting bill as legislature winds down

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SACRAMENTO, Calif. (8/27/14)--Gov. Jerry Brown signed into law a bill that will allow the state's financial institutions to file their California Department of Business Oversight (DBO) weekly reports electronically instead of by mail.
 
"Even this small change in state law can make life easier for those in our credit unions responsible for submitting this weekly report to the DBO," said Bob Arnould, senior vice president of advocacy for the California and Nevada Credit Union Leagues, which supported Assembly Bill 2298 (CU Weekly Aug. 26).
 
Credit unions and other depository institutions must submit weekly reports regarding the total amount of all deposits they hold. The bill, written by Assemblyman Freddie Rodriguez (D-Pomona), authorizes the weekly report to be delivered to the Administrator of Local Agency Security via email or other approved electronic means.
 
Arnould also noted, "This fall we will be undertaking a large state-charter review process and looking for fixes just like AB 2298 that provide for efficiencies, modernization and opportunities for state-licensed credit unions."
 
The two-year session will end at midnight Sunday, and the leagues' advocacy teams continue to track legislation of interest.
 
It supports Assembly Bill 2293, proposed by Assemblyman Susan Bonilla (D-Concord), which clarifies insurance coverage by transportation network companies (TNCs) such as Uber and Lyft. The bill seeks to protect consumers by requiring TNCs to provide accident liability protection that covers physical damage.
 
Although credit unions require insurance for all vehicles they provide loans for, that insurance does not cover all instances when drivers enter their vehicle into TNC services. When accidents occur while these cars are "in service," there is no financial backstop to cover vehicle damages.
 
Ultimately, credit unions can be left with a significant reduction in collateral value.
 
"We need to make sure credit unions are protected by ensuring that damage coverage is also required for vehicles used to provide TNC services," leagues President/CEO Diana Dykstra said (CU Weekly Aug. 11).

'Second chance' subprime auto loans necessary: Equifax

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ATLANTA (8/26/14)--A fair and functioning subprime auto lending market is an essential element of a healthy economy, according to a new white paper from Equifax.
 
Subprime auto lending does have its critics. Some subprime lenders have been criticized for granting loans with terms unfavorable to borrowers, similar to the mortgage issues that precipitated the financial crisis. Others say subprime auto lending could create a bubble similar to the one that precipitated the recent recession.
 
But "second chance" auto loans help people obtain access to convenient transportation, which makes them more employable and offers them more opportunities for education and community involvement, according to the Equifax white paper, "Not Yesterday's Subprime Auto Loan."
 
In a well-regulated financial market, rates are typically driven by competitive pressures, and predatory or discriminatory behaviors are prohibited by law, the white paper said. Borrowers who have credit scores in the subprime range have proven over time to have higher incidences of default on future obligations and thus are usually offered credit at higher interest rates than those with prime-grade credit scores.
 
Regarding a potential subprime auto lending bubble, Equifax studied data aggregated from the credit reports of more than 210 million consumers in its credit repository. The evaluated data indicates that subprime lending in the auto sector has been fairly stable since 2012; that originations have been shifting toward the higher end of the subprime spectrum; and that recent subprime loans have been performing well.
 
"Furthermore, the lending landscape today is not the same as it was in 2007," the paper said. "Lending in the heyday of the credit boom often greatly underweighted any consideration of credit worthiness outside of a credit score."
 
The paper explains that lending has returned to the "good old days," both because lenders generally have a reduced appetite for risk and because regulatory scrutiny has increased. In the subprime auto lending area, lenders are much more likely to verify incomes. "Given this, loans originated with a 620 credit score today are likely to perform very differently from loans originated with a 620 credit score in 2007, when the loans were likely granted without full underwriting," the paper said.

Fourteen credit unions located throughout the country participate in Non-Prime Auto Loans, a partnership between the National Credit Union Foundation and the Filene Research Institute that tests the viability of subprime auto lending in credit unions (News Now July 28). Through the program, credit unions make loan decisions that focus on the member's overall relationship with credit union.
 

Collegiate high school benefits from $125K donation

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ARLINGTON, Texas (8/26/14)--A hybrid secondary school is setting its first graduating class on a path to success with a $125,000 donation from Texas Trust CU, Mansfield, Texas.
 
The $846 million-asset credit union will support a scholarship fund for the Tarrant County College Southeast/Arlington Independent School District Collegiate High School.
 
The class of 2018--the inaugural class of the school that allows students to earn a high school diploma and up to 60 college credit hours simultaneously--will be the first to benefit from the scholarship fund.
 
Each student in the class of 2018 who graduates with a high school diploma and an associate's degree, achieves a 2.5 grade point average or higher and participates in a series of personal financial education workshops will be eligible for a $1,000 scholarship.
 
"The collegiate high school concept is the future of education," said Jim Minge, Texas Trust CU president/CEO. "We hope these scholarships can help open doors to a brighter financial future for these students."
 
William Coppola, president of Tarrant County College Southeast Campus, proclaimed the scholarships as an important part of "providing the opportunity for these students to earn an associate's degree while completing their high school graduation requirements."

CU System briefs (08/26/2014)

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  • ARLINGTON, Va. (8/26/14)--Stephen S. Pleger, senior deputy commissioner for the Georgia Department of Banking and Finance (DBF), has been named chair of the National Association of State Credit Union Supervisors (NASCUS). Pleger will preside over the NASCUS annual meeting on Sept. 10 and activities during the NASCUS State System Summit in Nashville, Sept. 10-12. Pleger was appointed to his current position with the Georgia DBF on May 1, 2010. He succeeds Mike Wettrich as NACUS board chair. Wettrich resigned from the NASCUS board and his post as chief examiner and interim deputy superintendent for credit unions at the Ohio Division of Financial Institutions to assume his new role as CEO of Education First CU, Westerville, Ohio ...
  • SAN ANTONIO and BELLINGHAM, Wash. (8/26/14)--Kyle Ashley has been named president/CEO of $223 million-asset United San Antonio Community FCU. Ashley most recently served as president/CEO of Allied FCU, Arlington, Texas, with $80 million in assets. Also, Jennifer Kutcher has been named president/CEO of Whatcom Educational CU, Bellingham, Wash., with $1 billion in assets. Kutcher, who previously served as Whatcom Educational CU's chief lending officer, will replace Wayne Langei. Langei, who has been CEO for 41 years, will retire at the end of August and remain a consultant through January ...

Biz Kid$, CUDE expansion among NCUF's 2013 highlights

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MADISON, Wis. (8/26/14)--In 2013, the National Credit Union Foundation (NCUF) continued to expand its mission of improving people's financial lives--reaching every Children's Miracle Network Hospitals in the United States and expanding its credit union development education (CUDE) program into Africa.
 
Those projects are only two of the many included in NCUF's recently released annual report.
 
The Biz Kid$ financial education program--free classroom curriculum, outreach activities, website and social media presence aimed at kids at 9 to 16--greatly increased its reach in 2013. NCUF distributed $124,961 in grants to 16 credit union organizations for Biz Kid$ education and outreach.
 
Thanks to donations by state credit union leagues and individual credit unions, each of the 158 Children's Miracle Network Hospitals now has at least one full boxed-set copy of the "Biz Kid$" television program. The partnership between NCUF and Credit Unions for Kids provides education to families facing financial challenges as well as health issues.
 
The "Biz Kid$" television show now has 39 episodes airing on American Forces Network, adding to the total 8.9 million viewers annually.
 
NCUF held a record three trainings of its CUDE program--one in North Carolina and two in Madison, Wis.--which resulted in 132 new CUDE graduates.
 
On the global credit union front, NCUF assisted with the launch of the first Africa CUDE program in Nairobi, Kenya. The Africa CUDE program was co-created by four African CUDEs.
 
For more information about NCUF's 2013 initiatives, including reality fairs, subprime auto lending pilot program and disaster relief, use the resource link.

CU branches in Napa slightly rattled after 6.0 quake

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NAPA, Calif. (8/26/14)--An early Sunday morning earthquake rattled the California wine country, and local credit union branches escaped relatively unscathed.
 
The 6.0 magnitude earthquake--the largest to hit the area since the 1989 Bay Area quake that registered 6.9--occurred about 3:20 a.m. Sunday and affected Napa and Sonoma counties. Commercial buildings in downtown Napa suffered damage, closing some buildings (MarketWatch Aug. 24).
 
One of those buildings was the old location for Santa Rosa-headquartered Community First CU. The $168 million-asset credit union opened its new, relocated branch--as planned--Monday morning.
 
"We are fully functional, and nothing was harmed," David Williams, vice president of marketing and human resources, told News Now. The credit union's employees were safe, and no one was hurt, he added.
 
"Living in an earthquake zone, it's always in the back of your mind," Williams said. "What is plan B, plan C, plan D, should it occur."
 
The credit union's new neighbors weren't so lucky Monday--a pizza parlor was closed because a cooler went out, and the nearby Lucky supermarket was closed for cleanup as well.
 
The old office is yellow-tagged and off-limits until it is deemed safe, Williams told News Now.
 
City officials advised people to avoid the downtown area where the Napa branch of Redwood CU, based in Santa Rosa, was located. Although service has been restored to the branch's ATM, the $2.38 billion-asset credit union advised its members to use caution when traveling in the area.
 
On its Facebook page, Redwood CU also encouraged members to visit its website to find additional Redwood branches and shared branch credit union locations.
 
The Napa and Vallejo branches of Vacaville-headquartered Travis CU, with $2.2 billion in assets, reported that both of those branches were open. Travis CU's Napa branch did sustain minor damage, according to Tina Ramos-Ingold, public affairs and consumer advocacy specialist at the California and Nevada Credit Union Leagues, but it is open.
 
Sacramento-based Golden 1 CU, with $8.4 billion in assets, reported that its branch was open for business, and members and staff were not affected.

Maine league adds co-op view to global Acadian Congress

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WESTBROOK, Maine (8/26/14)--Maine Credit Union League President John Murphy participated in a symposium on cooperation and cooperatives organized in conjunction with the World Acadian Congress, held Aug. 8-24.
 
Click to view larger image Maine Credit Union League President John Murphy shared the benefits of credit union cooperation during a symposium at the World Acadian Congress. (Maine Credit Union League Photo)
The symposium, held in Degelis, Quebec, was also attended by Dave Desjardins, president/CEO of Acadia FCU, Fort Kent, Maine, with $10 million in assets, and league board member Luis Sanclemente, vice president, Acadia FCU (Weekly Update Aug. 22).
 
The World Acadian Congress took place Aroostook County, Maine; Quebec and New Brunswick, Canada. The league sponsored the event.
 
The symposium brought together community stakeholders, including member of Canada's Parliament, to share the experiences of organizations that have chosen the cooperative business model.
 
In his remarks, Murphy discussed how the cooperative structure and principles have enabled the success of Maine's credit unions, beginning when the first credit union was formed in Maine in 1921. Maine credit unions have 641,000 members.
 
Murphy described how cooperation has helped Maine credit unions serve members through the SURF Network, the largest surcharge-free ATM network in Maine, and the shared branch network, which has nearly three times as many branches than any single bank in Maine.
 
"Cooperation gives Maine credit unions the strength and ability to compete and grow in the marketplace," Murphy said.
 
He also noted the strong ties that Maine credit unions have to the French-Canadian and Acadian heritage. "Many immigrants came to Maine from Canada and, because they only spoke French, were often turned away from traditional financial institutions purely for that reason," he explained. "Many credit unions have their roots in those beginnings, especially in communities such as Lewiston, Waterville, Biddeford, Madawaska and Fort Kent."

CU System briefs

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  • MADISON, Wis. (8/25/14)--On Thursday, Bill Hampel, interim president/CEO of the Credit Union National Association, completed and nominated others to take part in the ALS Ice Bucket Challenge. On Friday, at least two of those people delivered on his challenge. First, Bill Cheney, former CUNA president/CEO and current head of SchoolsFirst FCU, Santa Ana, Calif., with $10.3 billion in assets, poured a bucket of ice water over his head standing in front of the Pacific Ocean. Cheney then challenged Brian Branch, president/CEO, World Council of Credit Unions; Gigi Hyland, executive director, National Credit Union Foundation; and Bob Trunzo, president/CEO, CUNA Mutual Group. Next, Jill Tomalin, CUNA executive vice president/chief operating officer in Madison, Wis., took part in the challenge. Hampel was on hand to pour the ice water over Tomalin's head, then Tomalin challenged Mike Beall, president/CEO, National Cooperative Business Association; Paul Kundert, president/CEO, UW CU, Madison, Wis., $1.8 billion in assets; and two CUNA employees in Madison whose families have been directly affected by ALS ...
  • MADISON, Wis. (8/25/14)--The World Council of Credit Unions' radio show will take on the subject of building a sustainable economy in Africa today at 1 p.m. (CT). Those who tune in will hear from Elkanah Odembo, World Council vice president of the African region and former Kenyan ambassador to the United States, and from Jean Thiboutot, economic development expert and World Council project director in Rwanda. The show also will cover World Council's mission and vision for Africa. All World Council radio shows are archived on the World Council Radio Show page ...
     
  • AUSTIN, Texas (8/25/14)--University FCU, Austin, Texas, donated $1.5 million to fund construction of the Seton Healthcare Family's new teaching hospital, Seton Medical Center at The University of Texas. "Our cooperative's vision is 'a higher education community made strong through shared values and high-impact relationships,'" said Tony Budet, CEO of the $1.7 billion-asset credit union executive officer. The Seton Fund is spearheading efforts to raise $50 million for the project, which begins construction Tuesday ...
     
  • LYNCHBURG, Va. (8/25/14)--You can't serve ice-cold lemonade without a cup, and the $10,000 sponsorship by the Credit Unions Care Foundation of Virginia provided 200,000 vessels for the Anthem LemonAid campaign (Current Aug. 21). All told, the 1,479 LemonAid stands in the Richmond/Petersburg and Greater Hampton Roads areas raised $193,339 for Children's Hospital of Richmond at VCU and Children's Hospital of the King's Daughters, Norfolk. Virginia CU, Richmond, with $2.5 billion in assets, was the top-grossing stand--$3,568--among Richmond/Petersburg businesses ...

State conferences updated on CUNA advocacy, 100M memberships

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WASHINGTON (8/25/14)--Hundreds of legislators from throughout the country were greeted with the sight of the credit union movement's milestone of reaching 100 million memberships as they attended the annual National Conference of State Legislatures (NCSL) Legislative Summit.
 
Matt Coniglio, governmental affairs specialist, left, and Sheila Franklin, director of governmental affairs, Tennessee Credit Union League, catch up with Tennessee Rep. G.A. Hardaway (D-Memphis) at the National Conference of State Legislatures Legislative Summit in Minneapolis.
Legislators learned about credit union advocacy from the Credit Union National Association, Minnesota Credit Union Network, the Cornerstone Credit Union League, the Kentucky Credit Union League, the Mountain West Credit Union Association, the Northwest Credit Union Association and the Tennessee Credit Union League.
 
At last week's NCSL summit in Minneapolis, credit union advocates shared the benefits of credit union membership and pointed out to lawmakers the number of credit union memberships in their respective states.
 
CUNA and league staff also attended policymaking meetings of state legislators to ensure that credit union interests were advanced and protected.
 
Mark Minickiello, vice president of legislative affairs, Northwest Credit Union Association, left, shares the news of 100 million credit union memberships with Washington Rep. Sharon Tomiko Santos (D-Seattle). (CUNA Photos)
"State legislative advocacy is critical to credit unions, since state laws impact both state- and federally chartered credit unions," said Richard Dines, CUNA assistant vice president of state and league affairs. "Also, about half of the U.S. Congress is comprised of former state legislators, so the relationships built in the Statehouse translate to valuable relationships in the U.S. Capitol."
 
CUNA and league staff wore T-shirts bearing the 100 million memberships logo and referred attendees to asmarterchoice.org for more information about credit unions.
 
Earlier in the month, CUNA and league representatives attended the annual meeting of the American Legislative Exchange Council (ALEC) in Dallas. Cornerstone Credit Union Foundation staff spoke to attendees about the role of credit unions in providing financial education to their communities.

One by one, singles add up to 30% of homebuying market

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CHICAGO (8/25/14)--Nearly one-third of all real estate purchases were made by single homebuyers last year, according to a recent survey by Century 21, with almost two-thirds having to overcome a roadblock to buy their home (Realtor Mag Aug. 21).

The most intimidating aspects of the homebuying process, the National Association of Realtors' magazine reported, were: making an offer and negotiating the price (38%); obtaining a mortgage (36%); moving (31%); closing (30%); and searching for or locating a home (25%).

Regardless of any difficulty in buying their homes, however, 75% of single homeowners age 25 to 50 say homeownership is important to them.

"We are in the midst of a shift in the homebuying population," said Rick Davidson, president/CEO of Century 21 Real Estate. "This survey shows that home ownership is a major life decision for singles and that it is just as important a part of the American Dream as it is for married couples."

The top reasons to buy, according to the survey, were that they viewed homeownership as an investment in their financial futures; they were tired of paying rent; and they thought it was the right time to purchase a home (Realtor Mag).

Singles polled also said they were forced to make lifestyle sacrifices in order to facilitate the purchase, with 60% citing they had to dine out less in order to buy a home, and 51% having to spend less on vacations.

The survey also found what single homebuyers found to be most important when searching for a new home.

Square footage at 59% was the top priority, the yard (57%) was second, and proximity to work or school (47%) came in third. Good cell service and proximity to public transportation were more important to single homeowners between ages 25 and 35 than those 36 and older.

CU gives daily financial tips on Hispanic TV show

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IRWINDALE, Calif. (8/25/14)--Acknowledging the difficulties the Hispanic community can encounter in financial management, SCE FCU, Irwindale, Calif., decided in May to become a sponsor of an hourlong Los Angeles-area TV program that dives into various health and financial issues facing Hispanics.

George Poitou, chief operating officer of the $627 million-asset credit union, said that partnering with the show--called "Tu Mundo Hoy!" on KJLA-TV Los Angeles--mirrors SCE FCU's goal of empowering people to make better financial decisions and to achieve a higher quality of life.

"We're a resource people can turn to with whatever financial questions or concerns they may have, and this platform provided by KJLA allows us to share our insights firsthand," Poitou said.

The Spanish-language program, which airs Monday through Friday and is broadcast throughout Los Angeles and surrounding cities, is hosted by Emmy Award-winning radio personality Carlos Alvarez and TV news personality Ofelia de la Torre.

Last month, Pascual Garrido from SCE FCU recorded several segments covering basic financial management issues, such as saving money and using credit wisely.

The credit union receives five minutes of airtime each episode (Los Angeles Business Journal July 28).

"It's branding and marketing for us," Poitou told the Business Journal. "Most people don't know about us or about credit unions. But every time one of us speaks, there's a logo in the background that says 'SCE Federal Credit Union.'"

Poitou said that while the show isn't broadcast on a major network, he has seen evidence that people are beginning to tune in, as viewers more frequently are calling in to ask about business loans, and members have walked into branches talking about the show.

At first, Poitou had a difficult time finding employees to appear on the program, but now many are volunteering, he told the Business Journal.

"Now that they've seen a couple shows, everyone's getting used to it," he said.

CU Youth Week expands to full month of April

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MADISON, Wis. (8/25/14)--There's a time to celebrate the way credit unions support youth financial literacy. And that time has just been extended.

National Credit Union Youth Week, sponsored by the Credit Union National Association, has recently been expanded to a full month so that credit unions have even more time to connect with younger members.

The new "April is National Credit Union Youth Month" will provide more opportunities to formally attract young members and inspire them to start building--and maintaining--savings habits. 

Stretching the week also will match the event up with the National Youth Saving Challenge, which always has spanned a full month.

The challenge, a competition sponsored by CUNA and CUNA Strategic Services alliance provider GreenPath Debt Solutions, encourages young credit union members to put as much money away into savings as possible.

CUNA is also looking for some assistance in picking a theme for Youth Month 2015. Suggestions can be submitted to YWCoordinator@cuna.coop. The deadline to submit a theme suggestion is Wednesday.

The top themes will be put to a vote in early September.

Fall brings 2 opportunities to support CUs for Kids

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SALT LAKE CITY (8/25/14)--Credit unions, their members and employees can help support local Children's Miracle Network Hospitals in two engaging and unique ways this fall.

Participants can either sport the denim on Miracle Jeans Day, slated for Sept. 10, or spend loads on their credit union-issued credit or debit cards on Shop for Miracles Day, set for Oct. 16.

Both initiatives will funnel funding to Credit Unions for Kids and CMN Hospitals, a cause the entire credit union movement has supported for years, raising $110 million since 1996.   

Eileen Rivera, president/CEO, SkyOne FCU, Hawthorne, Calif., with $427 million in assets, said the dual initiatives to raise money for local children complement each other nicely.

"(Our employees) are looking forward to telling members to simply use their credit or debit card on Oct. 16, and a donation will be made to help our local CMN Hospital," Rivera said.

Each time a member uses their credit union credit or debit card on the day picked for Shop for Miracles--this year it's International Credit Union Day--the credit union will donate 25 cents to a local CMN Hospital as well.

Miracle Jeans Day, meanwhile, celebrates its fifth anniversary this year, after raising $185,000 during the day last year. To participate, credit unions must register with Credit Unions for Kids, and then encourage employees to donate $5 so they can wear jeans to work for the day.

For more information on the events, use the resource links.

Philosophy drives shared branching success

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MADISON, Wis. (8/25/14)--Shared branching: It may be the most distinctive feature of cooperative credit unions, but one of the least understood--at least until you need it.
 
Click to view larger imageOn the front page of its website, San Francisco FCU displays the breadth of its service to members through the shared branch network. (San Francisco FCU graphic)
It allows a member from one credit union to make financial transactions--cash checks, deposit funds, make a loan payment--at another credit union that is part of the shared branch network--currently more than 5,300 physical branches and another 2,000-plus self-service locations.
 
Shared branching is something only the credit union movement could do, said Sarah Canepa Bang, chief strategy officer for CO-OP Shared Branching, a business line of CO-OP Financial Services.
 
It's a service born of the idea that "I'm willing to trust you to take care of my members," she told News Now. "Bankers wouldn't even dream of doing something like that."
 
But how do credit unions educate members about shared branching? "Just tell them," she said. "Reward them with this value that your credit union gives them."
 
Make sure staff and call centers can tell members where to find a shared branch, either directing them to a website, an app or other location that will make it clear they can access credit union services elsewhere.
 
More than 50% of members know the premise of shared branching. "Once people need it, though, that's when they will understand it," she said.
 
The value of shared branching becomes apparent during times of natural disasters--something to consider with National Disaster Preparedness Month coming up in September--and with the 6.1 earthquake that hit the Napa region of California over the weekend.
 
Just think back to Hurricane Katrina--nearly nine years ago to the day--when displaced credit union members were able to access their accounts even though they were miles away from home. 
 
Bang said the shared branch network set up special identification policies for members who were without wallets or identification. "Imagine how those members felt when they were able to get $200 from the credit union," she said.
 
As a parent sending a child off to college, you could search for shared branches located around their school, Bang suggested, so they know how to access funds from their account and from you, without having to open a new account.
 
With the addition of $154 million-asset Ocean Communities FCU, Biddeford, the shared branch network in Maine now boasts nearly three times as many branches as any single bank in Maine--a fact the Maine Credit Union League recently touted. "Shared branching provides both convenience and service--it's a great combination for credit union members," said league President/CEO John Murphy.
 
Convenience is something personal to everyone, Bang said. Most people don't want to leave their credit union when they move. "Find out why they are closing the account," Bang advised. "If they are moving, show them where shared branches are located and how you can still be their credit union."
 
If a credit union is closing a branch, it should let its members know about nearby shared branch locations so they can continue to have access to convenient services, she said.
 
"You can be a small credit union and still be more convenient than any bank," Bang said.
 
And to help prove the value of credit union membership to legislators? Bang advised that credit unions know which congressional lawmakers are members and make sure they know that there are two shared branches right within their workplace-- U.S. Senate FCU and Congressional FCU--to serve them.

UPS latest giant to fall prey to data breach

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ATLANTA (8/22/14)--Add shipping giant United Parcel Service (UPS) to the list of merchants that have suffered a data breach that compromised its customers' credit and debit card information.
 
The Atlanta-based company said Wednesday it learned from the U.S. Department of Homeland Security and the U.S. Secret Service that malware found on computer systems at some The UPS Stores had exposed names, payment card numbers and postal and email addresses from about 100,000 transactions ( USA TODAY Aug. 21).
 
At-risk transactions took place in 51 stores in 24 states between Jan. 20 and Aug. 11. There are 4,470 franchised locations that are individually owned and run independent private networks that are not connected to other franchised center locations, the company said.
 
The UPS news follows on the heels of last week's breaches at grocery chains SuperValu and Albertsons. Since the Target breach last year--the granddaddy of breaches so far, affecting 40 million debit and credit card numbers and 70 million customers' information--the list of compromised merchants includes Neiman Marcus, Sally Beauty Supply, Michaels, P.F. Chang's, Goodwill Industries International and Jimmy John's.
 
Meanwhile, the website security flaw Heartbleed resurfaced in the hacking of 4.5 million patient records from Community Health Systems of Franklin, Tenn., which runs a network of 206 hospitals and satellite doctors' offices across 29 states.
 
In April, the Heartbleed bug in the Open Secure Socket Layer technology--used to establish secure links between servers and users--exposed millions of usernames, passwords and other information.
 
The stolen records from Community Health Systems go beyond card data; they include addresses, birth dates, telephone and Social Security numbers--all prime fodder for identity theft ( Bank Technology News Aug. 21).
 
Damage from the compromised information could exceed that of Target, John Zurawski, vice president of security software company Authentify, told Bank Technology News.  
 
"Target lost credit card information, but Community Health has lost Social Security numbers, addresses, birth dates, phone numbers--everything a fraudster needs to capitalize on the individual's credit rating and more," he said.
 
Thus, financial institutions should be wary on two fronts: Protect against the potential of increased credit fraud and redouble efforts to ensure their own systems are safe.

CU System briefs (08/22/2014)

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  • FORT BRAGG, N.C. (8/22/14)-- Fort Bragg FCU, Fayetteville, N.C., with $390 million in assets, and the USO of North Carolina have teamed up for Operation Cupcake, a program that helps junior enlisted soldiers celebrate their birthdays ( In the Loop Aug. 15). Once per month, the Fort Bragg Better Opportunities for Single Soldiers program (BOSS) and a USO volunteer deliver cupcakes and sing "Happy Birthday" to single soldiers. Operation Cupcake focuses on young, single soldiers who are away from their homes and families on their birthdays. Specialist and BOSS Vice President Sharrell Bellous, second from left, and Vanessa Pillmore, marketing assistant, Fort Bragg FCU, deliver cupcakes to two soldiers at Fort Bragg (Carolinas Credit Union League Photo) ...
  • NEWPORT NEWS, Va. (8/22/14)-- BayPort CU, Newport News, Va., is exploring merger opportunities with two credit unions. The board of the $1.3 billion-asset credit union and the board of Hampton City Employees CU , with $5.9 million in assets, approved initiating the merger. Members of Hampton City Employees will vote Sept. 9, and upon passage, the move would still need approval from regulators. Hampton City Employees CU has one branch in Hampton City Hall. BayPort CU also announced plans to merge with Hampton Roads Postal CU , with $3 million in assets and one branch, by Sept. 1 ( Daily Press Aug. 20) ...
  • SUNRISE, Fla., and SOUTH BEND, Ind.  (8/22/14)-- BrightStar CU, Sunrise, Fla., announced this week that its president/CEO, Ralph Crockett, is retiring after 15 years. Under Crockett's leadership, the credit union more than doubled in assets to $443 million from $209 million. Current board member Colin Battle has been named interim CEO. In South Bend, Ind., Andrew Burggraf is the new CEO at CommunityWide FCU, with $334 million in assets ( South Bend Tribune Aug. 20). He previously served as the chief operations officer. Longtime CEO Loren Roth has moved into the position of president/chief financial officer ...

Wyo. CU membership strong at 40% of state population

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CHEYENNE, Wyo. (8/22/14)--The credit union movement continues to celebrate reaching its 100 million memberships milestone, and Wyoming's high concentration of credit union members caught the eye of Wyoming Business Report .
 
Roughly 40% of the Equality State's population is a credit union member, significantly higher than the national total, which equates to one-third of the U.S. population.
 
"This is a testament to the long-standing principles that guide credit unions, namely that they put members first and operate in a manner to reflect that philosophy," said Scott Earl, president/CEO, Mountain West Credit Union Association (MWCUA). "It's apparent that this principle is working."
 
Wyoming credit unions added 1,400 members in the first quarter, bringing total membership to 230,000.
 
Wyoming's membership growth has climbed at a continuously fast clip--to 3.47% in 2013 from 2.91% in 2011--above the national growth rate of 2.9%
 
"It's much higher than a lot of the other states that we see," MWCUA Director of Corporate Communications Patti Hazlett told Wyoming Business Report (Aug. 7).

CUNA chief accepts chilly charity challenge

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WASHINGTON (8/22/14)--The Ice Bucket Challenge that's sweeping the nation to raise awareness for Amyotrophic lateral sclerosis (ALS) continued to make its way through the credit union movement Thursday, as Credit Union National Association interim President/CEO Bill Hampel had not one, but two buckets of ice water dumped on his head in Washington, D.C.

Click to view larger image John Magill, CUNA executive vice president of government affairs, left, douses the trade association's interim President/CEO Bill Hampel Thursday as part of the ALS Ice Bucket Challenge. See video of the event, below. (CUNA Photo)
For those unaware, individuals are invited to participate in the fundraising effort by someone who has already completed the challenge, which requires someone to take a video of themselves having ice water dumped on them and then to upload the video onto social media.

After the challenge has been completed, the person nominates several more participants, who then have 24 hours to complete the challenge or pay $100 to the ALS Association (ALSA).

So far, the Ice Bucket Challenge has raised $41.8 million nationwide, according to ALSA. ALS is a progressive neurodegenerative disease that affects nerve cells in the brain and the spinal cord.

CUNA also continues to be a strong supporter of the National Credit Union Foundation, Children's Miracle Network Hospitals and the Credit Unions For Kids campaign.

Patrick Conway, president/CEO of the Pennsylvania Credit Union Association, and the entire Credit Union Association of New York challenged Hampel.

Hampel then challenged four new people, including Bill Cheney, president/CEO, SchoolsFirst FCU, Santa Ana, Calif., with $10.3 billion in assets; Jill Tomalin, CUNA executive vice president/chief operating officer in Madison, Wis.; John Worth, chief economist at the National Credit Union Administration; and Cam Fine, president/CEO of the Independent Community Bankers of America.

John Magill, CUNA executive vice president of government affairs, and Ryan Donovan, CUNA senior vice president of legislative affairs, got into the spirit of the day as well when they became the subjects of surprised dousings.

Look outside narrow window of products for revenue growth: Filene

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MADISON, Wis. (8/22/14)--There are two sides to every balance sheet, and credit unions that want to remain financially sound now and into the future must start focusing on the revenue side, rather than only cutting back expenditures, according to a recent white paper from Filene Research Institute.

In "Addressing the Revenue Growth Challenge," Ron Shevlin, senior analyst for Aite Group, argues that focusing on efficiency only solves short-term profitability, but does nothing for future long-term growth.

Surveying 137 credit union leaders from institutions of all sizes to ferret out insight about how to find new revenue types, Shevlin examines existing sources of revenue and compiles ideas on where else credit unions can turn.

"It will take actual innovation and credit unions that build and strengthen their own product design competencies to drive more than marginal revenue growth in the future," Shevlin said.

From the survey, Shevlin found that many credit unions aren't being innovative enough in the products they offer.

His findings included:
  • Many credit unions plan to increase revenue through sales of existing products to existing members, as only one-quarter of those polled said they make it a priority to offer new products that can attract new members;
     
  • Credit union leaders largely said they believed interchange was the most promising path to enhancing revenue growth, with credit insurance and debt protection next on the list; and
     
  • Three-quarters of those surveyed said they expect to introduce less than two new products this year, with one-quarter expecting to introduce none.
Despite an increase in revenue growth in debit card interchange and fees in 2013, Shevlin wonders whether counting on similar gains year after year is sustainable, especially as U.S. debit card penetration has declined the past two years.

Further, Shevlin says credit unions place their hopes for revenue growth on a narrow set of products and services, but this can be overcome by taking several steps, including:
  • Creating credit card rewards programs, or strengthening the plans credit unions already have implemented;
     
  • Reinventing and crafting informative credit-related product marketing that can help members make decisions about loans, and potentially drive them to in-house loan products;
     
  • Bolstering personal financial management services by offering products such as payment-, advice- and insight-oriented services that are valuable enough for members to pay for; and
     
  • Focusing on member needs and desires.
About 15% of credit unions offer debit cards that feature a rewards program, which is an increase from 10% in 2010, according to the Credit Union National Association's 2013-14 Fees Report.

Offering these programs is important, Shevlin says, because studies have found that "rewards programs can significantly affect the preferences for cards relative to cash payments," and that, "the impact of rewards on card usage is higher for debit cardholders than for credit cardholders."

State OKs Floridacentral CU's bank branch purchase

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TAMPA, Fla. (8/22/14)--Tampa, Fla.,-based Floridacentral CU has received the thumbs up from the Florida Office of Financial Regulation to purchase a branch of the First Federal Bank of Florida, an office spokesperson confirmed to News Now Thursday.

The deal allows the $399 million-asset credit union to take over the bank's office in Sarasota, Fla., buy certain assets and take over liabilities from the bank. The National Credit Union Administration must still sign off on the transaction.

"Buying a bank branch typically allows for quicker geographic expansion and member growth than building a new branch," said Michael Bell, an attorney and counselor from Royal Oak, Mich. ( eSignal Aug. 21).

The undisclosed price tag for the building nets Floridacentral about $11 million in consumer deposits, according to CEO Laida Garcia, who has said that the building's location is desirable because of its central location in an area where 2,000 of the credit union's members live or work.

The bank's 600 remaining customers at the Sarasota branch will have to decide whether to become member/owners of Floridacentral or have their accounts transferred to one of the bank's remaining locations.

Urban youth program gets 'Financially Fit' with Seattle Metro

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SEATAC, Wash. (8/22/14)--A financial literacy program by Seattle Metropolitan CU (SMCU) has gained traction and attention for the benefits it is providing to an urban youth educational group.
 
As a volunteer for Year Up, an intensive one-year job training and educational program for 18- to 24-year-olds, Richard Romero saw an opening for financial education to become part of the curriculum ( Anthem Aug. 19).
 
The CEO of the $601 million-asset credit union took that opportunity to the business development team of Doug Brisbon and Raina Troupe.
 
The team worked with the Year Up Puget Sound director to develop the four focus points of what would become "Financially Fit:"
  • The power of saving and compound interest;
     
  • The idea that financial stability and building wealth is the "long game;"
     
  • That it's never too early to start a 401(k) or similar savings and investment vehicle; and
     
  • Financial basics such as checking and savings accounts.
"SMCU has provided numerous financial education events in the past," said Brisbon, "however we did not have one that was a perfect fit for the Year Up students, so we created 'Financially Fit' from the ground up."
 
More than 50 students and staff attended the first Financially Fit presentation at Year Up's office in Belltown.
 
"The 'Financially Fit' program has enabled us to augment our program offerings to include financial literacy," said Lisa Chin, executive director of Year Up Puget Sound. "SMCU supports our students as they work to not only begin their career, but to take steps toward a financially sound future."
 
The credit union is working on a three-part educational series that will coordinate with Year Up's yearlong program.
 
In fact, word of the success of "Financially Fit" is being spread by State Rep. Cindy Ryu (D-Shoreline). Ryu recently praised the program in an email to her fellow legislators, calling it "very practical and yet effective," Anthem noted.

CU CEO confidence continues upward trend

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PLANO, Texas (8/21/14)--Strong financial conditions and expectations have driven credit union CEO confidence to its third quarterly increase, according to Catalyst Corporate FCU's survey.
 
Catalyst Corporate's Credit Union CEO Confidence Index reached its highest level in six years--32.94--in the second quarter. This follows a first-quarter number of 30.32.
 
The largest quarter-over-quarter increase was noted in the CEOs' expectations for their credit unions' financial condition section, which jumped to 45.64 from 39.16.
 
The Present Situation Index edged upward to 32.76 from 29.47, and the Expectations Index bumped up to 33.03 from 30.75 in the first quarter.
 
The percentage of CEOs expecting conditions to improve over the next six months increased to 45.64 from 39.16. Assessment of their institutions' current condition also rose to 37.61 from 34.78.
 
"I share the optimism of the survey results," said Mike Murphy, CEO, $141 million-asset Holyoke (Mass.) CU, in a statement. "Credit losses are low, and real estate values are increasing modestly. Loan demand is up, with the exception of mortgage refinance activity, and the cost of funds is stable. Improvements in employment prospects are sure to benefit my membership."
 
CEOs also reported a positive membership environment, giving members' current financial condition an increase of 3.8 points and 3.44 points in the expectations for future conditions category.
 
Loan growth expectations barely moved from the previous quarter, and share growth potential declined to 23.27 from 24.15.
 
Credit unions have seen much-needed growth in consumer loans, said Brian Turner, director/chief strategist, Catalyst Strategic Solutions. "Unfortunately, the industry's larger credit unions ($500 million and greater) continue to get the lion's share of that growth. Credit unions under $500 million in assets are collectively experiencing a 12% decline," he noted.
 
More than 200 credit union professionals responded to the July survey, which evaluates current financial condition of members; current financial condition of the credit union; anticipated financial condition of members in six months; anticipated financial condition of the credit union in six months; anticipated loan demand at the credit union in six months; and anticipated share deposit growth at the credit union in six months.

Shifting delivery channels critical to survival: Report

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SCOTTSDALE, Ariz. (8/21/14)--Member interactions with credit unions are shifting, and unless credit unions address those delivery channels, their future is at risk, according to research from Cornerstone Advisors.
 
In "Delivery Redirect: Start Now or Perish Later!" the credit union consulting firm details how the current operational and regulatory burdens may be clouding credit unions' vision of the year 2020--if they make it that long.
 
The report cited:
  • The median number of branch teller transactions per month dropped 24% at mid-size banks since 2010;
     
  • A third of all mobile phone owners have used mobile banking in the past year, and 38% deposited checks using their mobile phones, nearly double from 2012; and
     
  • Lower branch traffic means fewer in-person opportunities for financial product purchases.
The report stressed that in preparing for 2020, financial institutions need to focus on migrating interactions and acquiring members instead of performing basic financial transactions.
 
Resources need to concentrate on the desired mix of physical and digital channels as well as the internal changes to redirect, support and leverage that model, the report added.

Post-pilot, N.J. energy loan program seeks more CUs

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HIGHTSTOWN, N.J. (8/21/14)--The New Jersey Credit Union League will hold an information session Sept. 10 about New Jersey's energy-efficient home improvement loan program, cuGreenLoans.
 
According to the league, the program was successful for the pilot credit unions, and it is now seeking more credit unions to participate. cuGreenLoans is a state-subsidized, interest-free loan available to homeowners for qualifying energy efficient home improvements through the New Jersey Clean Energy Program.
 
The program has been rolled out to all approved contractors throughout New Jersey, and members must meet specific requirements in order to be eligible.
 
The league will hold a live session at its headquarters in Hightstown that will be video conferenced to Atlantic FCU, Kenliworth, with $263 million in assets, and Members 1st of NJ FCU, Vineland, with $50 million in assets. The free session will run from 10 a.m. to 12:30 p.m. (ET) Sept. 10.
 
 Pilot participants $292 million-asset Garden Savings FCU, Parsippany, and $153 million-asset XCEL FCU, Bloomfield, will answer questions as part of the presentation.

DE program recognizes 3 for CU achievement

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MADISON, Wis. (8/21/14)--Three credit union development educators recently were honored by the U.S. Development Education (DE) Program for exemplifying what DE stands for through their individual or cooperative efforts to make a difference in their credit union, community or on a national/international basis. 
 
Michael Ray, director of corporate relations, Congressional FCU, Washington, D.C., and board director for America's Credit Union Museum, left, receives the lifetime achievement award from the U.S. Development Education Program from Gigi Hyland, executive director, National Credit Union Foundation. (National Credit Union Foundation Photo)
Michael Ray, director of corporate relations for $810 million-asset Congressional FCU, Washington, D.C., received the lifetime achievement award for making a significant and lasting contribution to the credit union movement and the DE program. Ray is a director for America's Credit Union Museum, Manchester, N.H., and serves on the D.C. chapter board for the Maryland and D.C. Credit Union Association.
 
"He quietly goes about his work to raise awareness about credit unions, to facilitate connections within the system and to foster international credit union development," said Gigi Hyland, executive director, National Credit Union Foundation. "That quiet work has made a tremendous difference in so many people's lives, and we are thankful for his commitment to credit unions and credit union development education."
 
Ray, who completed DE training in 1996, said he learned about the movement's pioneers at a DE "Philosophy is Good Business" seminar. "It was a wonderful introduction to what I consider my calling in life--to help others help themselves," he said.
 
The individual achievement award for significant impact on a national or international basis went to Melvin Edwards, a credit union development educator who has made it his mission to set up a DE training program in the Caribbean.
 
Edwards, who was the first Caribbean representative to serve as chair of the World Council of Credit Unions, also helped start the St. Kitts Cooperative CU.
 
CU Aware, a council within the Carolinas Credit Union League, received the Cooperative Spirit Award, which honors two or more individuals for a project that has made a significant difference to a community, school, credit union or the greater credit union movement.
 
CU Aware promotes awareness of cooperatives and the credit union difference. It was founded in 2011 by Patrick Livingston, director of strategic projects, and Brandon McAdams, consumer lending product development manager, both from $2.2 billion-asset at Coastal FCU, Raleigh, N.C.

Calif., Nev. catching up with robust loan growth

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ONTARIO, Calif. (8/21/14)--Loan growth at California and Nevada credit unions has surged recently, with both states posting numbers that haven't been recorded since before the Great Recession.

In California, credit unions nearly doubled their first quarter rate of loan growth, posting a 4% increase, which is the best second quarter for the state since 2007 ( CU Weekly Aug. 18).

Auto loans fueled the increase, with new-vehicle lending up 17.6%--nearly matching the national year-over-year increase of 19.4%--and used-auto loans increasing 8.1%. Mortgage-loan growth jumped 5.6% as well.

Dwight Johnston, chief economist for the California and Nevada Credit Union Leagues, told News Now that California lagged behind the rest of the country in recovering from the recession, and that the state is just now realizing the gains the rest of the country experienced previously.

"It's essentially California playing catch up," Johnston said. "(We've seen) a lot of growth in higher-paying jobs, and that's translated into better numbers this year."

Further, savings at California credit unions ticked up 3% in the first half of 2014 and are up 3.6% year-over-year. Credit union membership in the state has climbed 0.9% so far in 2014.

Credit unions in Nevada watched overall loan growth jump 4.7% in the second quarter, according to numbers from the Credit Union National Association, pushing up growth for all of 2014 to 5.1%.

And in Nevada, which took a similar economic hit to California, the economy is just now starting to catch up, according to Johnston.

"Nevada's biggest sector, travel and leisure, makes up more than 30% of workforce," Johnston told News Now . "It's now just recovered back to pre-recession levels."

While the majority of credit unions in the United States have seen growth driven largely by auto loans, credit card loans led the way in Nevada, with card balances climbing 7.2% in the first two quarters of the year.

Used-vehicle loans rose 5.9%, meanwhile, first mortgages increased 4.4% and new vehicles edged up 2.3%.

Deposits also climbed in Nevada, as balances jumped 0.6% in the second quarter, with savings account balances increasing 3.6% in the first six months of the year.

Save to Win hits $1M in savings at 6 Wash. CUs

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SILVERDALE, Wash. (8/21/14)--Credit unions in Washington offering the Save to Win program achieved the major milestone of taking in more than $1 million in deposits.

Launched a little over a year ago, Save to Win is a type of prize-linked savings (PLS) account that credit unions throughout the United States are encouraging state legislatures to legalize in order to help under-banked citizens improve their savings habits.

Washington's foray into PLS demonstrates just how effective the programs can be.

Among the six credit unions offering Save to Win, 1,242 members have opened accounts as of July 31, and the average account balance was $812.39 ( Anthem Aug. 19).

"Save to Win has been a great tool for us to help our members save money in a fun and unique way," Scott Prior, president/CEO of Connection CU, Silverdale, Wash., with $27 million in assets, told Anthem. "It's interesting the looks you get from people when you explain how it works, as if it almost sounds too good to be true."

Through the yearlong program, members open a 12-month share certificate with at least $25. For every $25 they save, they earn entry into monthly and annual drawings to win prizes that range from $50 to $5,000.

While not all Save to Win participants win prizes, they do keep all the money they've put away, plus interest, at the end of the year.

"I think the synopsis is, this works," said Jim Morrell, CEO of Peninsula Community FCU, Shelton, Wash., with $149 million in assets, who told Anthem he expects more credit unions to pick up the program in future months. "It encourages people to save and they don't have any chance of losing money."

"Not enough people are in the habit of saving," Morrell added. "This can help instill that habit."

States that have passed PLS legislation include Connecticut, Maryland, Indiana, Nebraska, North Carolina, Washington, Maine and Rhode Island, with New York's own law only awaiting the signature of Gov. Andrew Cuomo ( News Now July 9).

Youth align with CUs, building 100M memberships: Fox report

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TAMPA, Fla. (8/20/14)--Stressed by economic doldrums and callous bank policies, young adults may be finding safe harbor in credit union membership, according to an Aug. 18 report by WOFL-TV , in Tampa Bay, Fla.
 
Chris Chmura, FOX 13 consumer reporter, recently interviewed Suncoast CU's Gary Vien, who Chmura called a "foot soldier" in the financial revolution.
 
 
 
"I think millennials choose credit unions because they connect to it, because they connect with the mission," said Vien, who is chief administrative officer at the $5.7 billion-asset Tampa, Fla., credit union. "We save people money."
 
As the credit union movement celebrates the milestone of 100 million memberships, its not-for-profit cooperative structure and better rates are attracting members like Larissa Dias-Lizarraga.
 
"Immediately, I felt the difference," said Dias-Lizarraga, a teacher who spent 10 years with a traditional bank paying fees for account maintenance and statements. "They were just trying to take my money, and that's not OK," she told Chmura.
 
"Our generation and credit unions share a lot of values," the 33-year-old added.
 
Though the movement has reached that membership milestone, it still is far behind the banking industry, with only 6% of U.S. deposits found in credit unions and one location for every 14 bank branches.
 
Chmura noted that this generation of financially and philosophically savvy adults will ask more of their financial institutions, which means, Vien said, banks will have to pick up their game.
 
In New York, the member-friendly missions of First Source FCU, New Hartford, N.Y., with $388 million in assets, and AmeriCU CU, Rome, with $1.2 billion in assets, also appear to have bolstered membership growth to the 100 million mark.
 
As a 28-year-old, Joe Leonard ditched his bank and joined First Source FCU. Now, at 43, he boasts of the "great personal service and one-on-one time" he gets from his credit union, his exclusive financial institution ( Utica Observer-Dispatch Aug. 16). "I tell people all the time how much better it is."
 
New York credit unions have notched a 5 million membership milestone as well this year ( News Now Aug. 13).
 
Judith Cowden, vice president of member relations and marketing, $1.2 billion-asset AmeriCU, Rome, credited recent success to the dissatisfaction with bank mergers and fees combined with the credit union's low loan rates and lack of fees.
 
"The bigger commercial banks have pulled out of this area and don't seem to be interested in us," Cowden told the Observer-Dispatch . "And the practices that have been put in place by those that remain have really alienated the average consumer. No one wants to have to pay so much to access their own money."

La. league launches new biz development council

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HARAHAN, La. (8/20/14)--The Louisiana Credit Union League recently announced the launch of its new Louisiana Marketing and Business Development Council, an organization the league hopes will equip professionals with the tools necessary to help propel the credit union movement in Louisiana.

Introduced last week during the league's annual meeting and convention, the council will provide a space for credit union professionals to work and learn from one another in a collaborative environment, while also providing access to resources and other opportunities that will help spark creativity.

"By pulling together individual experiences and knowledge, council members can evoke change," the league said in a press release.

Membership on the council and participation in any of the council's events, including webinars, conference calls, meetings and conferences, is open to all credit union employees and trade associations affiliated with the Louisiana league. Membership is now open.

Those who participate will have access to professional networking opportunities throughout the year, including:
  • Professional development opportunities;
     
  • Reduced registration fees for council events;
     
  • Periodic teleconferences with Louisiana credit union marketing professionals;
     
  • Networking opportunities with other Louisiana credit union professionals; and
     
  • Regular e-newsletter updates from the council.
Members of the advisory committee, which provides overall direction for the council, include:
  • Emily Beatmann, Section 705 FCU, Lafayette, with $33 million in assets;
  • Heather Escott, Lafayette Schools FCU, with $174 million in assets;
  • Kelli Green, Centric FCU, West Monroe, with $113 million in assets;
  • Jill Skaggs, Bossier FCU, Bossier City, with $157 million in assets; and
  • Ashley Varnam, Louisiana FCU, La Place, with $183 million in assets.

CU System briefs (08/20/2014)

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  • ST. PAUL, Minn. (8/20/14)-- The Minnesota Credit Union Foundation is accepting grants for this fall for credit unions to launch financial education projects. Non-credit union organizations may also apply for grant funding, but they must partner with a Minnesota credit union and demonstrate how the project will affect credit unions and their members. Applications will be accepted through Oct. 1 , and grants will be evaluated by the foundation's board of directors on credit union value, community impact, collaboration, creativity and past involvement in and support of foundation activities. Recipients will be announced by mid-October ...
     
  • HELENA, Mont. (8/20/14)-- Montana Credit Unions for Community Development (MCUCD) launched its new website that is intended to be a one-stop consumer resource and toolbox for credit unions, partner organizations, credit union members and Montana consumers. The website keys in on four areas: free tax services, matched savings accounts, consumer resources and financial education. MCUCD is a statewide nonprofit organization working with Montana's credit unions to improve the social and economic well-being of all Montanans ...

NFCC: Prevent holiday blues by checking budget now

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WASHINGTON (8/20/14)--Don't want coal in your stocking for breaking the holiday budget? The National Foundation for Credit Counseling (NFCC) is encouraging consumers to assess their current financial status before heading into the holidays.
 
"Consumers may still be receiving the summer vacation and back-to-school bills, but should not lose sight of the fact that the holiday spending season is just around the corner.  This makes it vitally important for a person to understand their current financial situation before taking on new debt obligations," said Gail Cunningham, NFCC spokesperson. "Doing otherwise could result in damaging an already fragile financial situation."
 
The NFCC offered a financial checkup quiz as part of the assessment, where a simple true or false can give consumers an idea of where they stand.
 
True or false:  "Concerning my current financial situation, I ..."
  1. Know how much I currently owe on each credit card.
  2. Am receiving collection calls and notices.
  3. Have money saved to pay cash for holiday expenses.
  4. Will be adding new debt on top of old debt if holiday expenses are charged.
  5. Have reviewed my credit report and score in the past 12 months.
  6. Am near the maximum amount allowed on my lines of credit. 
  7. Am current on my vehicle payment.
  8. Have applied for a payday loan, title loan or credit card cash advance in the past 12 months.
  9. Have savings in addition to money earmarked for holiday spending.
  10. Have overdrawn my checking account more than twice in the past 12 months.
If the answers for the odd-numbered statement were true, consumers are in good shape. Answering true to the even-numbered statements means borrowers may be headed for choppy waters and should re-evaluate budgets before holiday spending begins.

CU, college relationships mean higher fin. ed.

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MADISON, Wis. (8/20/14)--There may be a university logo on their debit cards, but collegiate credit unions also are integral to financial literacy efforts at their namesake institutions.
 
This week, the board of trustees for Seminole State College of Florida in Sanford approved a partnership with CFE FCU, Lake Mary, that will support financial education and scholarships.
 
The $1.4 billion-asset credit union will develop an on-campus financial literacy program, contribute to programs at the college's Career Development Center and host money management workshops. The sponsorship will provide up to $250,000 in annual support for Seminole State College over the next 10 years.
 
In 2015, CFE FCU will launch a special branded debit card with the college's logo. For each debit card purchase, the credit union will make a donation to the Foundation for Seminole State College. The foundation will use the proceeds of the donations to provide scholarships and support other programs.
 
Student members also benefit from belonging to their university credit union. Many offer free checking, access to surcharge-free ATM networks, shared branching and on-campus ATMs or branches. Universities with high populations of international students focus on free incoming wire or interbank transfers to help students get money from home.
 
Debit rewards programs are popular as well. Purdue FCU, West Lafayette, Ind., with $823 million in assets, offers a free student checking account that includes cash back for debit card usage. In a reward of a different kind, Harvard University Employees CU, Cambridge, Mass., with $452 million in assets, treats good students with good eats. Students who show their GPA of 3.5 or above will receive a $10 restaurant gift certificate from the credit union.
 
St. John's University, Collegeville, Minn., will have a student-run branch on its campus this fall, thanks to a grant from the Minnesota Credit Union Foundation. The branch of $11 million-asset Collegeville Community CU will be one of the first credit unions on a university campus in Minnesota.
 
The branch will be managed by a 2014 St. John's graduate and employ up to six students part time. The credit union also hopes to work with the school departments to offer real-life experiences, ranging from accounting to finance and marketing.
 

CU House in Mo. welcomes summer Democratic caucus

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JEFFERSON CITY, Mo. (8/20/14)--The Missouri Credit Union House in Jefferson City served as the host site for the Missouri House Democrats' summer caucus and reception last week.
 
Click to view larger image Rick Nichols, president/CEO, and Dana Alderman, vice president of member development, River Region CU, Jefferson City, left, talk with State Rep. Judy Morgan (D-Kansas City) and State Rep. Charlie Norr (D-Springfield) during the Missouri House Democrats' summer caucus, held in Missouri's own Credit Union House. (Missouri Credit Union Association Photo)
Credit union leaders had the opportunity to talk with a number of Democratic House members and candidates ahead of the September veto session and November general elections. House Minority Leader Jacob Hummel (D-St. Louis) and members of the House Financial Institutions Committee also attended ( Missouri Difference Aug. 15).
 
"Building relationships with lawmakers, sharing credit union concerns and telling our story is crucial for the future of the credit union industry," said Rick Nichols, president/CEO, River Region CU, Jefferson City, $99 million in assets. "This brought a large group of candidates and potential candidates together, which enables us to share key points about credit unions with them before the legislative session kicks in."
 
Also representing credit unions were Dana Alderman, vice president of member development, River Region CU; Greg Newsom, branch manager, United CU, Fulton, with $143 million in assets; and David Kent, director of state legislative affairs, Missouri Credit Union Association (MCUA).

Hummel also thanked MCUA for allowing the caucus to use the Jefferson City location. "Our members enjoyed interacting with leaders in the credit union industry and were grateful for the hospitality," he said.

More than a dozen groups and individuals have used Missouri Credit Union House for meetings this year. Upcoming events during the veto session include receptions by Paul Fitzwater (R-Potosi), who is a member of the House Financial Institutions Committee, Craig Redmon (R-Canton) and Lyndall Fraker (R-Marshfield).
 

CU System briefs (08/19/2014)

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  • ST. PAUL, Minn. (8/19/14)-- Last week, Sen. Al Franken (D-Minn.) met with credit union leaders at City and County CU, St. Paul, with $414 million in assets. Mark Cummins, president/CEO, Minnesota Credit Union Network (MnCUN), discussed credit unions' regulatory burden and their need to increase the member business lending cap. Franken learned more about credit unions' efforts to provide financial education, including the introduction of student-run credit unions in local schools. "City and County CU appreciates the work Sen. Franken has done on behalf of credit unions and the communities we serve," said Pat Pierce, City and County CU president/CEO. Franken is one of 27 senators who have written to the National Credit Union Administration regarding its risk-based capital proposal. From left, Pat Brekken, president, Richfield-Bloomington CU, Richfield, with $258 million in assets; Karen Fleming, president/CEO, HBI Employees CU, St. Paul, with $6.9 million in assets; Mara Humphrey, McCUN vice president of governmental affairs; Franken; Dave Larson, president/CEO, Affinity Plus FCU, St. Paul, with $1.7 billion in assets; Joe Mathews, director, City and County CU; Pierce; and Cummins (City and County CU Photo) ...
  • EAST LANSING, Mich. (8/19/14)-- In six months, Michigan State University FCU, East Lansing, Mich., has raised more than $44,000 for Haven House , which provides emergency housing and support for homeless families. The amount is the largest ever raised by the credit union's charity committee. "Our employees went above and beyond to make this initiative a success," said Patrick McPharlin, president/CEO of the $2.6 billion-asset credit union. In addition to monetary donations, employees prepared meals for residents, cleaned and organized the shelter and did gardening chores. Haven House will use the donated funds to upgrade the shelter and relocate the children's playroom ...
  • NORTH GREENBUSH, N.Y. (8/19/14)-- Donald G. Burns, former CEO, Postal Employees of Troy, N.Y., FCU, with $1.6 million in assets, died Aug. 17 . He was 85 ( Times Union Aug. 18). Burns was the CEO of the credit union for almost 40 years and worked for the U.S. Postal Service for 32 years ...

Minn. CEO Cummins offers SuperValu breach advice

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ST. PAUL, Minn. (8/19/14)--When reports surfaced that a major data-breach had hit the SuperValu grocery chain, which operates hundreds of grocery stores throughout the Midwest, media outlets called on a credit union leader to seek insight into how this will affect financial institutions.

While the scope of the breach may not be as great as other high-profile attacks, Minnesota Credit Union Network President/CEO Mark Cummins told the Minneapolis/St. Paul Business Journal (Aug. 15), financial institutions will still feel an impact.

"SuperValu and Cub Foods in particular are well-known brands that many credit union folks shop at," Cummins told the Business Journal .

And the cost of replacing credit and debit cards for credit unions can run between $5 and $10, Cummins said, adding the Target breach cost credit unions in Minnesota about $750,000.   

SuperValu reported last week that more than 200 locations had been infiltrated through its payments-processing systems between June 22 and July 17 of this year, and an investigation into the matter is under way.

The Credit Union National Association continues to urge Congress to address data security as it relates to merchants, who aren't held to the same standards as credit unions and other financial institutions.

Minnesota, meanwhile, isn't the only state that would be affected by a breach of SuperValu stores.

Illinois Educators CU, Springfield, Ill., with $50 million in assets, sent out a notification to members that the credit union is aware of the breach, which may have affected Illinois-based stores such as Shop 'n Save and Jewel-Osco, and that it will closely monitor any new information that materializes.

"We strongly advise members who may have shopped at any of the affected stores with their IECU debit or credit cards to closely monitor their accounts," an IECU press release said.

Additionally, the Los Angeles Times reported Friday that the grocery store chain Albertsons was attacked recently as well, affecting approximately 180 stores in Southern California, in addition to many others in several other states.

The Boise, Idaho-based chain also operates stores in Idaho, Montana, North Dakota, Nevada, Oregon, Washington, Wyoming and southern Utah. Albertsons said the breach occurred between June 22 and July 17.

Food security improved in Ethiopia with World Council program

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MADISON, Wis. (8/19/14)--More than 44,600 farmers in three Ethiopian regions increased crop yields and incomes with the support of a development program from the World Council of Credit Unions.
 
Click to view larger image After receiving chickens through the World Council of Credit Union's program, more than 3,800 model farmers in Ethiopia generated higher household incomes through increased egg production. (World Council of Credit Unions Photo)
The World Council worked with farmers and 165 rural savings and credit cooperatives (RuSACCOs) in Tigray, Oromia and Amhara to expand financing for agriculture and to promote savings.
 
Farmers learned how to transition to commercial food production from subsistence farming, learning soil and water conservation techniques along the way.
 
They also were trained on planting techniques and crop diversification that produced higher quality and more nutritious food.
 
By the end of the program, savings per RuSACCO member increased 89%, and loans per member increased by 167%.
 
Primary crops were introduced to diversified vegetable and grain crops that increased farmers' incomes by 129%. Secondary crop production--up by 150%--allowed farmers to continue to grow food for their families despite severe drought conditions.
 
The 2009-2014 program was funded by the monetization of 23,000 tons of wheat through the U.S. Department of Agriculture's Food for Progress program.

Eight new ideas hatched from Filene innovation incubator

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MADISON, Wis. (8/19/14)--Credit unions have started exploring the latest ideas to come from the Filene Research Institute's i3 group.
 
The i3 group focuses on ideas, innovation and implementation--as its name signifies--in the credit union marketplace. The eight newest ideas from the group cover relationships--with employees, with borrowers, with teens, with third parties and with new credit unions. They are:
  • Knowledge transfer doesn't apply just to credit union operations. Employees' First leverages the collective experiences of credit union employees for life's challenges such as a death in the family, buying a house or student loans. The Employees' First initial study found, the more knowledge employees had of a topic--perhaps even firsthand--the more comfortable they felt in providing guidance.
  • When member inquiries are pouring in about a slow web site or stalled mobile banking, member-facing staff may not know what is causing the problem. The information technology department may just be learning of an issue with a vendor. That's where Status Track comes in. It gives members and staff a snapshot of what is going on--green for all systems go; yellow representing regularly scheduled maintenance or partial service interruption; and red indicating a system outage.
  • MyDime gives members the power to structure a loan that fits their budget. The app, aimed at users age 18-34, takes the member through the steps needed to set up the loan and, ultimately, fund and sign for the loan. As the member walks through the process, he also can see how the loan will affect his credit score.
  • Young adults with a thin credit history--either little or no credit usage--could turn to the Independence Card. Aimed at 18- and 19-year-olds, the Independence Card incents young members to use credit responsibly by offering redeemable rewards and a step-up credit card upon hitting age 20.
  • Reviews of third-party vendors would populate CU Crowd Speak, a project that would allow credit unions to share experience with service providers in a Yelp-type environment.
  • Dream Ride seeks to weave the many parts of the car-buying experience--choosing a car, finding out gas and insurance costs, locating a dealer, getting a loan--into one app.
  • Credit unions can help connect their member small businesses with the community with Members Market, which increases the profile of local businesses to the credit union's membership.
  • Reducing the challenges of switching pre-authorized payments when opening a new account, Switch Ninja automated the transfer of billing information. A test run by Canada's Valley First CU resulted in less "switch pain" for both staff and members.

Mich. league issues 4th consecutive dues rebate

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LANSING, Mich. (8/19/14)--The Michigan Credit Union League board this month approved a 50% rebate on membership dues for its member credit unions, the fourth year running it has approved returning half the cost of being a member of the league ( Michigan Monitor Aug. 18).

David Adams, league president/CEO, says the league, which has provided discounted membership dues to its members since 2009, can offer rebates for a variety of reasons.

"First, because our membership and policymakers have given us a license to build our member net assets reserves, we have a strong base of capital for investment," Adams said, adding that the better the league's investments perform, the less it must rely on dues for revenue.

Second, Adams said, the league has been able to provide rebates thanks to the success of its CU Solutions Group (CUSG), of which it owns 67% of the earnings.

"CUSG is again enjoying a very profitable year in 2014," the league said in a press release. In fact, the investments have performed well enough that the league has adopted the strategy of running its operation at a deficit.  

Credit unions will have several options for using the money, according to the league. They can keep it to help their own budgets, contribute it to help fund the league's political engagement, help fund cooperative advertising or provide funding to the Michigan Credit Union Foundation.

No matter where the money is allocated, it will go "to good use supporting the good work you do at your credit union every day," Adams said.

Third of retirement savers haven't bumped contributions

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NEW YORK (8/19/14)--More than a third of workers who have employer-sponsored retirement plans haven't upped the percentage of their contributions, and 26% haven't increased their contributions in more than a year.
 
Financial services provider TIAA-CREF surveyed more than 1,000 adults about their retirement intentions and found that 53% were not automatically enrolled in their companies' plans.
 
Between lack of participation and lagging savings--44% of U.S. employees save 10% or less of their annual income each year--employees are losing opportunities to solidify their retirement funding, the study noted. Credit unions can provide critical financial planning for their members long before the retirement party is planned.
 
The survey also found 57% of workers did not increase their plan contribution after their last raise, citing a need to cover immediate expenses. One-quarter of respondents said they were already contributing the maximum so they did not make any adjustments after their last raise.
 
More than half of workers age 18-34 were more likely to increase savings after a raise, and of those Millennials who didn't bump up contributions, 23% said they were contributing the maximum amount allowed.
 
"Plan sponsors should be proactively looking for opportunities to engage directly with employees about their retirement savings, especially during pivotal times such as benefits enrollment season and after an employee receives a raise," said Teresa Hassara, executive vice president, TIAA-CREF's Institutional Business. "Reaching employees at the right time with the right messaging can have a profound effect on retirement readiness."

CUs' down-payment programs help members achieve dreams

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LINTHICUM, Md. (8/19/14)--Using down-payment assistance programs, credit unions across the country are helping members, particularly first-time homebuyers, finally achieve their dreams of homeownership.

In many cases, recent trends have shown, a clean bill of credit health and a strong income may not be enough to purchase a home, in large part because of the rising costs of plunking down a down payment.

Between 2007 and 2013, the average down payment on the most affordable properties climbed nearly $4,000 to $9,840 ( News Now Aug. 18).

But credit unions such as State Employees CU (SECU), Linthicum, Md., with $2.8 billion in assets, are stepping up to help those previously able to qualify for a loan, but unable to come up with funds necessary for a down payment.

Through SECU's "100% Mortgage Financing Program," for as little as $1,000 a member can purchase a home ( Herald-Mail Aug. 11).

"This is a product intended to help the local community," Kevin Kesecker, SECU vice president of lending, told the Herald-Mail. "The intent is to overcome the hurdle of a down payment."

Mountain America CU, West Jordan, Utah, with $3.9 billion in assets, has rolled out a similar program recently to help members buy their first homes.

The credit union's "First-Time Home Buyer Loan Program," features 100% financing; down payments of as little as $1,000; one, low payment; no income limitations; and no private mortgage insurance requirements, among other benefits.

Members who utilize the program also can have monthly payments taken directly from their checking or savings accounts.

Michigan Community CU, Jackson, Mich., meanwhile, was recently approved to provide loans through the Federal Home Loan Bank of Indianapolis' Homeownership Opportunities Program. The $123 million-asset credit union can now help first-time homebuyers at or below 80% of the area's median income with their down payments, plus their closing costs.

Beth Ploof, mortgage originator for Michigan Community CU, said that because the program will allow more people to purchase homes, it also will help improve the local economy.

"These funds are a life-changer in the best way," said the first credit union member to receive help on her down payment through the program, Alise.

CUNA CFO Council notches 1,300 members

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MADISON, Wis. (8/18/14)--The CUNA CFO Council has reached the milestone of 1,300 members--the largest membership among the six CUNA Councils.
 
"The CFO Council's remarkable growth signifies how much our membership values being part of a peer-led, industry-focused and discipline-focused organization," said Suzanne Weinstein, CFO Council executive committee chair/chief financial officer at Orlando (Fla.) FCU, with $190 million in assets. "I wouldn't want to imagine being in the credit union industry in a leadership capacity without being a CUNA CFO Council member."
 
Added John Meeker, CFO Council membership committee chair and senior vice president/chief financial officer, Caltech Employees FCU in La Canada Flintridge, Calif., with $1.2 billion in assets: "Despite continued consolidation in our industry, the CUNA CFO Council continues to attract new members. The council leadership is continuously is looking for ways to add value for members and is pleased members recognize the tremendous value they receive by joining the CUNA CFO Council."
 
The council's 2015 national conference is set for May 17-20 in New Orleans.

CU System brief (08/18/2014)

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  • SPRINGHILL, La. (8/18/14)-- James P. Gibson, president/CEO of Carter FCU, Springhill, La., has announced his retirement effective Aug. 31, after more than 40 years in the credit union industry. Since Gibson assumed the president/CEO role at the credit union, Carter FCU has more than doubled its asset size to more than $240 million ( Shreveport Times Aug. 17). Carter FCU has appointed Joe Arnold, who currently serves as executive vice president and has been an employee of the credit union since 2009, to serve as Gibson's successor ...

Founder going door-to-door to build CU

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BUFFALO, N.Y. (8/18/14)--First it was criss-crossing the state of New York, searching for donated supplies to equip a fledgling credit union. Now, organizer Emma Smalley is going door-to-door collecting signatures to support the creation of a new credit union on Buffalo's west side.
 
Smalley, who is the manager of $4.1 million-asset Niagara Falls (N.Y.) Penn Central ECU, set the path for Good Neighbors FCU more than a year ago after receiving preliminary approval from the National Credit Union Administration.
 
Final approval from the regulator requires 400 signatures from the neighborhood. So far, the door-to-door campaign has captured 280 signatures, but Smalley is reaching for 1,000 ( Business First of Buffalo Aug. 15).
 
Good Neighbors FCU received a low-income credit union designation. The neighborhood is heavily populated with immigrants who distrust financial institutions, preferring to pay a fee to cash their checks and keep the money at home, Business First noted. Those cash-heavy households are prone to theft, and state estimates say Buffalo's "unbanked" or "underbanked" pay an annual average of $900 in fees.
 
"You shouldn't have to pay five bucks to cash a check, or 22 to 23% interest on an auto loan just because nobody has shown you how to fix your credit," she told Business First. "It's unfair asking people to play the financial game when nobody has shown them the rules."
 
Steve Deisig, board chairman, said he hopes the credit union's cooperative governance, focus on financial literacy and membership structure will draw people to use the credit union for transactions, learning about credit and ultimately being able to purchase houses or cars.
 
"There's a community-good aspect to our credit union," Deisig told Business First . "We are there to help these people."
 
In addition to April's cross-state road trip where Smalley collected office supplies and equipment from fellow credit unions, she is working to raise at least $100,000 for startup operational funds.

Ukrainian CU gifts $150K to educational center

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PHILADELPHIA (8/18/14)--Ukrainian Selfreliance FCU (USFCU) announced this week it will donate $150,000 spread over the next three years to the Ukrainian Educational and Cultural Center (UECC) in Jenkintown, Pa.

The center, which has hosted multiple Ukrainian-American organizations since 1980, will use the money to help make improvements to its facilities.

USFCU, with $260 million in assets, serves 9,000 members and is the fifth-largest credit union in Philadelphia.

"This gift will allow us to make much-needed building renovations that will enable us to better serve the needs of the community," said Sophia Koropeckyj, UECC president.

More than 30 organizations operate from the educational center, including the Ukrainian Federation of America, Prometheus Ukrainian Male Chorus and youth groups such as the Ukrainian Heritage School and the Ukrainian Youth Association.

"The UECC is an invaluable asset to the community and is utilized by many of our members," said Mary Kolodij, USFCU board chair.

Lakota FCU builds on financial trust

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KYLE, S.D. (8/18/14)--When someone has relied solely on nontraditional methods for safeguarding his or her finances--think under the mattress--it's not a stretch to imagine that that person might be hesitant to trust their money with someone else.

But one credit union in South Dakota is counting on its members, who reside on a reservation found in one of the poorest counties in the United States, to place their trust in it just the same.

And with more than 1,600 members, Lakota FCU, Kyle, S.D., with $2 million in assets, has served the Oglala Lakota tribe for the last two years, giving the Lakota people their first ever financial institution.

"People no longer have to drive long distances to Hot Springs or Rapid City to do their banking," Jim Kent, columnist for the Rapid City Journal , wrote in an Aug. 14 article. "But more importantly, Lakota money is staying on the reservation, as one tribal member who opens a savings account helps another tribal member start or finance their business, pay off their debts or purchase a new vehicle to transport them to their job."

In an area where people aren't accustomed to the idea of banking, however, it can be a tall order to get folks to trust the credit union as the right place to keep their money, Kent said.

That fact is never more apparent as when tribal members walk into the credit union with land buy-back settlement checks, cash four- and five-figure amounts and walk out without depositing any money, an occurrence that happens often, Kent reported.

Not only does that leave the members without financial security, but it also limits the investment that can be made in their community.

"The best way for the people of Pine Ridge to establish an economic empowerment zone is to do it themselves," Kent wrote. "The opportunity is there; all that's needed is trust in their fellow Lakota."

The credit union may need to be patient in allowing that trust to build, but waiting patiently would merely be taking a cue from the members they serve: the Lakota people, who waited 123 years for their first financial institution.

Larson elected chair of Minnesota foundation

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ST. PAUL, Minn. (8/18/4)--The Minnesota Credit Union Foundation last week announced its board members and table officers.

Dave Larson, president/CEO, Affinity Plus FCU, St. Paul, with $1.7 billion in assets, was elected board chair.

"I am energized by work of the foundation and its focus on financial education," said Larson. "I look forward to serving in this leadership role as we work to strengthen credit unions and communities across the state."

Brian Sherrick, president/CEO, Ideal CU, Woodbury, with $567 million in assets, was elected vice chair; and Kathy Harrington, president/CEO, Heartland CU, Inver Grove Heights, with $101 million in assets, was elected secretary/treasurer.

Larson succeeds Pat Brekken, president/CEO, Richfield Bloomington CU, Richfield, with $258 million in assets. Both Larson and Sherrick previously served as vice chair and secretary/treasurer, respectively. Table officers are elected for one-year terms.

At the foundation's annual meeting in July, Sherrick was re-elected to a three-year term, as was Mary Hansen, CEO/administrator, Mayo Employees FCU, Rochester, with $666 million in assets. Hansen was first elected to the foundation board in 2004, and Sherrick in 2011. Larson joined the foundation in 2009.

Rounding out the seven-person board are Larry Champeaux, president/CEO, Northern Communities CU, Duluth, with $72 million in assets; and Glen Durbahn, senior vice president, marketing and member experience, Hiway FCU, St. Paul, with $950 million in assets.

La. league adds 12 to Hall of Fame

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HARAHAN, La. (8/18/14)--The Louisiana Credit Union League (LCUL) inducted 12 individuals into the Louisiana Credit Union Hall of Fame at its recently held 2014 annual meeting and convention.
 
The league's Hall of Fame program was established to recognize the valuable leadership, commitment, dedication and contributions of credit union professionals and volunteers throughout the state.
The 2014 inductees recognized are:
  • Isadore "Izzy" Brown, Shell Geismar FCU, Gonzales, with $29 million in assets;
  • Sharlene Begnaud, CU Cooperative Branching LLC, Harahan;
  • Ray A. Bordelon, Lafayette Schools FCU, with $173 million in assets;
  • Audrey D. Cerise, Past & Present Employees ASI FCU, Harahan, with $323 million in assets;
  • Judy DeLucca, The New Orleans Firemen's FCU, Metairie, with $155 million in assets;
  • Dr. James Fortenberry, Southern Teachers & Parents FCU, Baton Rouge, with $28 million in assets;
  • Roosevelt Howard, Livingston Parish FCU, Denham Springs, with $15 million in assets;
  • Vince Liberto, CUNA Mutual Group/LCUL, Harahan;
  • James Lea Liner, Ouachita Valley FCU, West Monroe, with $176 million in assets;
  • Stanley Dale Liner, Ouachita Valley FCU;
  • John Milazzo Jr., CU Cooperative Branching LLC; and
  • Martha Morris, Shreveport FCU, with $102 million in assets.
A special wall designated for the Louisiana Credit Union Hall of Fame is located in the league's headquarters, where the names of the inductees are prominently displayed.
 
A $500 donation on behalf of each inductee will be made to the Louisiana Credit Union Foundation. The donation will help foster educational programs for credit unions as well as support resources for Louisiana credit unions during times of natural disasters.

N.Y. foundation hosts NEFE financial education training

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ALBANY, N.Y. (8/15/14)--The New York Credit Union Foundation again partnered with Cornell Cooperative Extension to train New York teachers and community volunteers on the National Endowment for Financial Education's (NEFE) High School Financial Planning Program (HSFPP).
 
Educators review the National Endowment for Financial Education's High School Financial Planning Program materials at Empower FCU, Syracuse, with $1.2 billion in assets. (Credit Union Association of New York Photo)
The organizations hosted training sessions Aug. 5 at Empower FCU in Syracuse, with $1.2 billion in assets, and Aug. 7 at Hudson River Community CU in Corinth, with $187 million in assets, the Credit Union Association of New York (CUANY) reported (The Point Aug. 14).
 
The daylong session prepared educators and credit union professionals to teach the award-winning HSFPP curriculum to youth in their area schools and community groups.
 
Barbara Henza, a trainer with the Cornell Cooperative Extension, reviewed the curriculum modules, which included planning, borrowing, earning capability, investing, financial services and insurance.
 
Henza also outlined the program resources available to educators, including student guides, teacher lesson plans and a growing collection of online resources and learning activities.
 
Many New York credit unions provide free curriculum materials and teach the HSFPP in schools across the state. According to CUANY's 2013 MORE Report, the state's credit unions educated more than 119,000 children through youth financial literacy programs last year.

CUs participate in FHLBank Pittsburgh Roundtable

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PITTSBURGH (8/15/14)--Credit unions and others shared concerns about lending and housing issues recently during an FHLBank Pittsburgh roundtable. The forum featured Congressman Mike Fitzpatrick (R-Pa.), who serves on the House Financial Services Committee (Life is a Highway Aug. 14).

Discussions covered today's regulatory environment for local financial institutions and the ability for those institutions to serve members and consumers.

The roundtable also touched on government-sponsored enterprise reform, a hot topic for credit unions.

On Wednesday, the Federal Housing Finance Agency (FHFA) made public its interest in combining Fannie Mae and Freddie Mac mortgage-backed securities into a single security structure in an effort to bolster efficiency and liquidity in the mortgage market.

Credit Union National Association leaders support measures that make such improvements, but have not yet fully studied the implications of the FHFA proposal.  

The "impact on prices credit unions receive for the sales of their mortgages to the government-sponsored enterprises, as well as the proposal's potential impact on the values of existing MBS investments," warrant continued assessment, said Eric Richard, CUNA general counsel/executive vice president for regulatory affairs (News Now Aug. 14).

Among those credit union leaders participating at the forum in Pittsburgh included Robert Fox, senior vice president/chief lending officer, TruMark FCU, Trevose, Pa., with $1.5 billion in assets; and Annette Baker, regional vice president of branch operations, American Heritage FCU, Philadelphia, with $1.4 billion in assets.

Christina Mihalik, vice president of governmental affairs, attended on behalf of the Pennsylvania Credit Union Association.

Shred-letter day: San Diego County CU reclaims world shred record

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SAN DIEGO (8/15/14)--Trees rejoice. San Diego County CU set its second Guinness World Record last month during the credit union's "Super Shred Event" for the most paper ever collected during a 24-hour period in a single location.

The event, which helps members protect and safely dispose of sensitive documents, while also encouraging recycling, saved 3,590 trees. More than 7,000 people showed up at Qualcomm Stadium and shredded 422,350 pounds of paper.

"SDCCU is committed to helping our customers and the community protect their confidential data and privacy," said Teresa Halleck, president/CEO of the $6.5 billion-asset credit union. "We are dedicated to preventing identity theft as well as (to) our efforts to go green with our online banking services, such as eStatements and eReceipts."

SDCCU hosted its first shred event in 2007, and since then has shredded and recycled more than 1.1 million pounds of paper, at no charge, saving more than 9,700 trees.

The credit union first grabbed the record for most paper collected during a similar shred event last year, but was overtaken in April by an organization in Texas.

"SDCCU would like to thank the entire community for banding together to help take back our world record and be a part of history," Halleck said.

La. league annual report notes 80th anniversary

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HARAHAN, La. (8/15/14)--In its annual report released at this year's convention, the Louisiana Credit Union League noted the successes of 2013, including advocacy at the state level.
 
"Now in our 80th year of operation, the Louisiana Credit Union League has proven it can stand the test of time--demonstrating that the principle values on which we were founded (service and mutual cooperation) remain relevant still today," league Chairman Glenn Beard and President/CEO Anne M. Cochran wrote in the chairman/CEO report. "But though we are rooted in traditional values, we move forward with a continual focus on delivering innovative products and services designed to meet the ever-changing needs of credit unions and their members."
 
The report highlighted the role the league played in the latest legislative session: initiating legislation on electronic signatures and offering recommendations regarding alternatives to payday lending programs.
 
The league also reported net income of $550,000, an increase from $270,000 from 2012, and assets of $3.4 million in 2013, an increase from $3.17 million in assets the year prior.

Louisiana credit unions contributed $21,100 to state small businesses through its CU Lunch Local program, spearheaded by the league's Member Business Services Council.
 
Louisiana counted 164 federally chartered and 42 state-chartered credit unions as of December 2013. In all, Louisiana credit unions reported 1,226,555 members and 3,429 full-time employees.
 
The league's Young Professional Network included 340 members in 2013.
 
Louisiana credit unions raised $167,099 for the Credit Union Legislative Action Council in 2013.
 
CU Cooperative Branching, the league's shared branching initiative, included 149 locations throughout the state.

Summit: Staying quiet not an option for CU advocates

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AUSTIN, Texas (8/15/14)--Credit union leaders from Texas, Oklahoma and Arkansas gathered in Austin, Texas, this week to take part in the Cornerstone Credit Union League's 2014 Legislative Summit.

The league hosts the two-day event as an opportunity for credit union minds to come together and discuss strategies for broadening the movement's political influence and to determine state and federal priorities (Leaguer Aug. 14).

On the first day, Jim Phelps, Cornerstone's vice president of advocacy, led the proceedings with an overview of the recent Cornerstone advocacy survey, which aimed to help identify the issues that are most important to credit unions.

One of the overriding results of the survey was that, for a number of reasons, most credit unions believe the industry must be politically engaged. "There's too much at risk to not be involved," said one respondent.

Phelps was followed by Sam Whitfield, Credit Union National Association vice president of legislative affairs, who offered an update on recent legislative activities within Congress.

Whitfield also brought with him the message that credit unions must stay as engaged as they were during the successful "Don't Tax My Credit Union" campaign, explaining that similar efforts could be critical in tackling future regulatory issues.

On the second day, Buddy Gill, National Credit Union Administration senior adviser to the chairman, presented an update on the NCUA.

Gill also touched on the proposed risk-based capital rule, discussing why the NCUA developed the original proposal and the capital standards the administration is considering.

Upon finishing his remarks, Gill opened up the floor to questions, which were largely dominated by those about risk-based capital.

84% think back-to-school shopping is too expensive

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WASHINGTON (8/15/14)--American consumers think back-to-school shopping is becoming too expensive, as annual costs continue to rise, according to a new survey from the National Retail Federation.

The average family with children in grades K-12 expects to spend as much as $669.28 on clothing, shoes, school supplies and electronics in 2014--an increase of 5% from $634.78 last year.

The survey asked 1,515 Americans to identify the price range they think is acceptable to pay for back-to-school supplies and expenses. The poll asked: What do you think is a reasonable household back-to-school shopping budget?
  • Between $0 and $199;
  • Between $200 and $499;
  • Between $500 and $699;
  • Between $700 and $999; or
  • $1,000 or more.
About 84% of participants said that a reasonable amount was between $0 and $199 or between $200 and $499, GoBankingRates.com reported (Aug. 14).

Families with high school students and middle school students spend virtually the same: $682.99 for high school students, and $682.13 for middle school/junior high students. Parents with elementary school-age children will spend an average of $580.94.

Technology is driving a large part of the increase. Back-to-school shoppers will spend an average $212.35 on electronic items, up 7% from $199.05 last year.

About 53.8% of back-to-school shoppers will shop at a clothing store, 64.4% will visit discount stores, and 59.1% will shop at their favorite department store.

Study: All-encompassing rewards highly prized by FI users

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MONTREAL (8/14/14)--Consumers want financial institutions to reward them for their business, according to a survey conducted by CGI Group, an independent information technology and business process services firm.

The survey revealed that consumers expect financial institutions to be more than just a repository for their money. The most-expected "wants" included:
  • Reward me for my business (81%);
  • Give me "anytime, anyplace" access to my balance (61%);
  • See me as a person (58%);
  • Provide me with wealth-building advice (55%);
  • Tell me what I am spending money on and how I can save (52%);
  • Give me access to independent experts when I need them (50%);
  • Allow me to borrow up to an agreed limit at any time (49%); and
  • Allow me to pay for goods and services instantly using whatever device (49%).
"Being rewarded for their business is by far the top service demanded by consumers," CGI said in an analysis of the study. "They expect to be valued for their total spending and rewarded for their loyalty. Reward programs are fast becoming mainstream, with loyalty cards, cashback offers, loyalty discounts, upgrades and free nights and flights offered by retailers and credit card companies. Financial consumers are saying, 'You see all my spending, so why can't you reward me for all my spending?'"
 
Credit unions often have awards programs associated with their credit card programs, according to the Credit Union National Association's 2013-2014 Fees Report. About 55% of credit unions with platinum/titanium programs have rewards featured with the card, 40% of those with gold cards have a rewards feature and 25% of those with classic programs do.
 
Among credit unions that offer debit cards, about 5% to 15% of those with assets of $200 million or less have a rewards program associated with the card. Among those card-offering credit unions with assets of $200 million to $1 billion, roughly 25% offer rewards programs.  That percentage rises to 35% among those with assets of $1 billion or more.
 
The top two reasons why consumers switch banks were poor service (40%) and better rates elsewhere (39%). Those results would seem to bode well for credit unions, which place high priority on member service and operate through a cooperative structure that allows them to offer better rates on savings and loans than their for-profit competitors.

CUs stuff buses, backpacks for back to school

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MADISON, Wis. (8/14/14)--Crayons, glue, pencils and notebooks are just a few of the many school supplies that credit unions are collecting during annual donation campaigns, and for some educator-based credit unions, it's a project that goes straight to the heart.
 
Click for slide show Girls Inc. of the Greater Capital Region in Albany and Schenectady, N.Y., received backpacks and school supplies from $1.08 billion-asset Capital Communications FCU, Albany, N.Y. (Capital Communications FCU Photo)
Mark Bailey, morning host on San Diego's XETV-TV , interviewed California Coast CU President/CEO Todd Lane about the $1.85 billion-asset credit union's "Drive for Success" program that aims to provide school supplies for the area's 20,000 homeless children. Last year, it reached 4,000 kids; this year the goal is 8,000, Lane told Bailey (Aug. 5).
 
"They need school supplies like any other kid going to school," Lane said. He noted that the credit union, which is working with the San Diego County Office of Education on the project, was founded by educators 85 years ago. "We're very much involved in the school system here in San Diego," Lane said.
 
TTCU The Credit Union, Tulsa, Okla., with $1.4 billion in assets, teamed up with Restore Hope Ministries and KTUL-TV to distribute nearly 1,300 boxes of school supplies in the Tulsa area with its "Project School Supplies." Donita Quesnel, vice president of marketing, told KTUL-TV , "Our roots, our legacy really is in being a credit union for teachers, so anything that we can help further education and help these kids out is great.
 
"When you think about being that one child in the classroom who walks in and doesn't have the basic supplies that everyone else has, all of a sudden there is an obstacle to learning," she said. "These kids are facing enough challenges. Having the basic equipment shouldn't be one of those challenges."
 
On Wednesday, the Education Partnership and members, employees and the board of Riverset CU, Pittsburgh, distributed supplies to the Pittsburgh King PreK-8 School, part of the Pittsburgh Public School District ( Philadelphia Business Journal Aug. 13). The $122 million-asset credit union began 80 years ago to serve solely the employees of the Pittsburgh Public School System.  
 
Many students go without the most basic of school supplies due to homelessness, poverty or unstable living situations such as an unemployed parent. That's when the credit unions step in with their "people helping people" philosophy.
  • Teens in Albany, N.Y., helped $ 1.08 billion-asset Capital Communications FCU, Albany, N.Y., fill 500 backpacks with school supplies which then went to children at Girls Inc. of the Greater Capital Region in Albany and Schenectady, N.Y., and St. Catherine's Center for Children, Albany ( WRGB-TV Aug. 4).
  • Lake Michigan CU, Grand Rapids, Mich., with $3.2 billion in assets, uses its One Pencil Project to help cash-strapped schools and teachers. All of its branches will collect supplies through the end of August. In 2013, Lake Michigan CU helped 385 teachers and more than 50 school districts in west Michigan. Teachers are encouraged to let the credit union know what they need for their classrooms through the One Pencil Project website, www.lmcu.org/onepencil .
  • In Mississippi, Navigator CU, Pascagoula, with $286 million in assets, and Singing River FCU, Moss Point, with $196 million in assets, joined in to help the United Way for Jackson and George Counties provide school supplies for area children. Singing River FCU's Moss Point location served as the "store front" for school representatives to shop for supplies that will be taken back to the kids who need them the most ( GulfLive.com Aug. 12).
  • Kellogg Community FCU, Battle Creek, Mich., took a different twist with its back-to-school campaign. The $436 million-asset credit union teamed up with Charitable Union to collect youth size 12 pants for area youth for the this school year.
  • Now in its sixth year, the "Stuff the Bus" campaign from Northumberland County Schools FCU, Milton, Pa., expanded its donations to reach all grade levels in both Milton and Warrior Run school districts. The $18 million-asset credit union recently added Warrior Run students and their families to its field of membership, said Manager/CEO Brenda Raker said ( The Standard-Journal July 25).  Donors to the campaign were entered to win a gift card, donated by the credit union.
  • To help students and parents, Connections CU, Pocatello, Idaho, with $137 million assets, is giving away school supplies at its branches this weekend ( Idaho State Journal Aug. 13).
  • Red Canoe CU, Longview, Wash., with $598 million in assets, will match pound-for-pound items donated to its "Fill the Canoe" school supply drive. Since 2007, more than 47,500 pounds of supplies have been collected.

Money woes weigh heavy in wee hours of the night: NFCC

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WASHINGTON (8/14/14)--With their focus on personal service and financial education, credit unions have an opportunity to help consumers rest easier after roughly 79% of respondents to a National Foundation for Credit Counseling (NFCC) poll said personal finances keep them awake at night.
 
In addition to the obvious credit problems resulting from overwhelming debt, financial concerns can wreck marriages, tear families apart and create distractions at work, NFCC reminded the public. 
 
The 2014 NFCC Financial Literacy Survey revealed that 71% of consumers, or roughly 179 million people, admitted to having personal finance worries, with not enough savings, job issues, debt and credit topping the list.
 
The NFCC's July online poll question and answers are below:
 
What keeps you up at night?
  • Financial worries:  79%;
  • Marital concerns: 2%;
  • Job security: 4%;
  • Problems with the children: 2%; and
  • Nothing, I sleep like a baby: 13%.

Utah celebrates #100MM at Bees baseball game

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SALT LAKE CITY (8/14/14)--About 550 credit union employees and their family members celebrated the 100 million membership milestone at a Salt Lake Bees baseball game Aug. 9.

Utah Credit Union Association President/CEO Scott Simpson tossed the ceremonial first pitch prior to the game.

Following the second inning, the field announcer informed the crowd that credit unions had surpassed the 100 million membership mark and shared the benefits of belonging to a credit union.

"It was a fun night, and a good way to note the milestone," Simpson told News Now in an e-mail.

CU System briefs (08/14/2014)

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  • HARRISBURG, Pa. (8/14/14)-- Representatives from Pennsylvania's Lehigh County credit unions gathered this week to meet with U.S. Rep. Charlie Dent (R-Pa.), the Pennsylvania Credit Union Association (PCUA) reported ( Life is a Highway Aug. 13). Participants included JoAnn Broderick, president/CEO, First Commonwealth FCU, Lehigh Valley, with $573 million in assets; Alan Musselman, executive vice president, First Commonwealth FCU and member of the PCUA's Governmental Affairs Committee; Sue Phillips, vice president/chief information officer, People First FCU, Allentown, Pa., with $448 million in assets, and Lehigh Valley Chapter president. Christina Mihalik, vice president of governmental affairs, and Angelique Pattillo, account executive, attended the meeting on behalf of the PCUA. The meeting allowed credit unions to thank Dent for joining his colleagues in a letter to the National Credit Union Administration voicing concerns on the agency's risk-based capital proposal. Dent provided attendees with a Washington, D.C., and district update, and a discussion on regulatory pressure, government-sponsored enterprise reform, security and data breaches (Pennsylvania Credit Union Association Photo) ...
  • MINNEAPOLIS (8/14/14)--Credit union leagues are reminding their members to take part in Miracle Treat Day. Dairy Queen, a partner of Children's Miracle Network, invites credit unions to participate in Miracle Treat Day today. For every Blizzard Treat purchased at participating DQ stores, $1 or more will be donated to local Children's Miracle Network Hospitals to help children in need ...
  • LONGVIEW, Wash. (8/14/14)-- Arne E. Aurvinen, a founder of Lower Columbia Longshoremen's FCU, Longview, Wash., with $65 million in assets, died July 31 ( The Daily News Aug. 11). Aurvinen was instrumental in organizing the first longshoremen's credit union in 1954, serving as the organization's first treasurer. Over the next 14 years, he served as president and as a member of the supervisory committee of Lower Columbia Longshoremen's FCU. The credit union celebrated its 60th anniversary in April, with Aurvinen taking part in the festivities ...

CU internship brings college grads back to work

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ST. JOSEPH, Mich. (8/14/14)--United FCU hired three familiar faces recently--familiar because each previously completed the St. Joseph, Mich.-based credit union's internship program, which helped train them for their new jobs with the credit union.

The three new employees, who will work in finance, business products and advertising, and public relations respectively, interned for the $1.7 billion-asset credit union in the summer of 2013 before their last year of college.

Upon graduation, United FCU offered jobs to Andrew Jary, Zach Weir and Ben Wyse.

"By recruiting early, we are able to train these young professionals while they are still in college, and then offer them employment at UFCU when they graduate," said Cindy Swigert, chief human resources officer. "Not only does this help us maintain a fantastic service-focused employee base for our members, it also helps grow the local job market."

This year, the credit union has hired one new intern from Saginaw Valley State University, who will support the learning and development team at the credit union.

While the credit union doesn't guarantee jobs once the internship has been completed, the credit union aims to keep in mind positions they expect to be available in the short-term when accepting applications, Lou Ann Schafer, United FCU director of public relations and advertising, told News Now .

Students interested in the program must apply their sophomore or junior year of college, maintain a GPA at or above 3.5 and receive three letters of recommendation from previous professors or supervisors.

The credit union hopes to expand the number of internship positions available so that it can provide more opportunities for potential future employees to participate.

"The response from potential interns has been great," Swigert said. "We have introduced students from Grand Rapids to Saginaw to what UFCU and Michigan's Great Southwest has to offer."

CU System briefs (08/13/2014)

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  • DOVER, Ohio (8/13/14)-- Dover-Phila FCU, Dover, Ohio, with $370 million in assets, contributed $40,000 to the Union Hospital capital campaign to help build a new emergency center , which is to begin construction this summer ( The Times Reporter Aug. 10). The credit union also donated $500 to Dover's Parent-Teacher Group to contribute to the East School playground upgrade project in June ...
  • CINCINNATI (8/13/14)-- Communicating Arts CU, Cincinnati, with $58 million in assets, and Cincinnati Central CU, with $94 million in assets, have announced a plan to merge, creating a new credit union with a new name and identity . The boards of directors of each credit union have adopted a resolution of intention to merge, with an expected effective date of April 1, 2015, pending regulatory approval and a vote by Communicating Arts' members ...

N.Y. media takes notice of 100M membership milestone

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ALBANY, N.Y. (8/13/14)--New York credit unions announced the milestone achievement of reaching 5 million memberships at the same time that credit unions nationally surpassed the 100 million membership mark. The two benchmarks have attracted coverage for credit unions from media outlets throughout the Empire State, the Credit Union Association of New York (CUANY) reports.

The New York Post , the sixth most-circulated daily newspaper in the country, highlighted both milestones in an article published on Sunday.

"Credit unions are snapping up customers at a rapid clip," wrote reporter Catherine Curan. "And that's thanks to lower interest rates on loans and higher yields on savings than many banks offer."

Robert G. Allen, president/CEO of Teachers FCU, Hauppauge, with $4.9 billion in assets, told the Post that consumer awareness of credit unions has grown significantly as nationwide membership has increased.
 
On the opposite side of the state, the Buffalo Business First article, "NY credit unions crack 5 million plateau," was published on the websites of several other American City Business Journals newspapers, including the Albany Business Review and the New York Business Journal .
 
The article, written by Allissa Kline, mentioned both the 5 million and 100 million figures, and it included a quote from CUANY President/CEO William J. Mellin: "We have a statewide movement that is five million memberships strong and growing every day."

Beacon FCU members put charities in spotlight

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WABASH, Ind. (8/13/14)--Credit unions frequently pool funds in an effort to support local organizations and charities, but one credit union in Indiana has adopted an innovative way to pick which organizations to aid: by taking a vote of its members.

Beacon FCU, Wabash, Ind., with $1 billion in assets, recently announced the Project Spotlight charitable giving campaign, which it designed to help discover and support worthwhile projects within the various communities the credit union serves.

At the outset of the program, the credit union sent out a call to members to nominate local charities, not-for-profits and community projects to become eligible for funding from Beacon.

Voting for the most recently nominated organizations began Aug. 1.

"With your help and participation, when voting ends at the end of September, we'll be donating a total of $21,000, benefiting 36 charitable organizations and projects in northeast Indiana," the credit union said on its website.

Beacon will split $1,750 among the first-, second- and third-place winners in each of the 12 communities the credit union operates a branch. 

"Our hope is to be able to support community projects both large and small, and bring awareness to the many good things happening in our communities every day," Beacon said.

Some workers prefer higher 401(k) match over higher salary

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BOSTON (8/13/14)--Scores of employees across the country would rather their employer make larger contributions to their 401(k) than pull in a larger paycheck, a recent survey by Fidelity Investments found.

In fact, more than 4 of 10 workers polled said they would even prefer to see their compensation lowered if it meant a higher employer contribution to their 401(k).

"Employer contributions play a vital role in helping Americans reach their retirement savings goals," said Doug Fisher, senior vice president of workplace investing at Fidelity. "These contributions represent more than 35% of the total contributions on average to an employee's workplace savings account."

According to the study, which polled about 1,027 people focusing on compensation scenarios, workers were more likely to take a job where the company matched part of its overall compensation package.

Only 13% of respondents said they would accept a position at a company that didn't offer an employer match, even if the pay was better.

The study also revealed that employees are using 401(k)s as their only source of savings for retirement, with 42% indicating that they aren't saving for retirement through any other means.

While employees should perhaps take steps to save for retirement in other ways, it seems 401(k)s can make a dent in the amount workers should be putting away each year, as the typical employer match is now 4.3% of pay, which is an average of about $3,540 per year, the survey found.

About 79% of employers who provide workplace savings plans offer employer contributions, according to Fidelity data.

Filene book compiles 25 years of 'Think. Do. Change.'

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MADISON, Wis. (8/13/14)--Twenty-five years ago, the credit union movement created the Filene Research Institute. Its mission? To engage in research, planning, and development activities of value and interest to the credit union movement.
 
In honor of its silver anniversary, Filene released "Celebrate Filene: 25 Years of Think. Do. Change." that traces its journey from working with the University of Wisconsin-Madison's School of Business to the i3 (Ideas, Innovation and Implementation) program.
 
The organization's name honors Edward A. Filene, whose personal commitment to credit union movement in the early 1900s was the key factor in creating the modern credit union. Filene spent more than $1 million of his personal fortune spreading the credit union message because he saw credit unions as the future source of financial services for working Americans and their families.
 
That message continues today, said CEO Mark Meyer. "The credit union movement is the stitching of our social fabric, protecting and enabling consumers who've been left behind by the big banks," he said. "Filene's research and programs have been pivotal in helping millions of people build a better world for themselves, and for their communities."
 
One of those projects is "Save to Win," a prize-linked savings (PLS) program that started in Michigan in 2008. With many PLS accounts, in return for deposits of as little as $25, members are entered into a monthly or yearly drawing to receive larger amounts.
 
Nebraska, Michigan, North Carolina, Washington, Connecticut, Indiana, Maine, Maryland and Rhode Island allow PLS accounts at credit unions, and the American Savings Promotion Act has been introduced in the U.S. Congress to allow all financial institutions to offer PLS accounts.
 
Consumers have saved more than $70 million through PLS accounts that might not have been saved otherwise, the report noted.
 
"This is goose-bump stuff for us when we can see our efforts bearing fruit, changing behaviors, making people's lives better," Meyer said.

Balancing needs of members, CUs topic of CFO Council white paper

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MADISON, Wis. (8/13/14)--Striking a balance between serving the needs of members with the financial health and performance of the credit union is the topic of a new white papers by the CUNA CFO Council.
 
"Credit Union Financial Management: Balancing the Economic Engine" was written by Council member Brian W. Hughes, vice president of finance, wealth and business solutions, Sun FCU, Maumee, Ohio, with $508 million in assets.
 
Hughes discusses how credit unions must balance the unique expectations of member/owners against the demands of regulatory and risk requirements in operating a modern-day financial institution.
 
In the paper, he illustrates that balance with a story:
 
"Several years ago, a branch manager came to me with a sad story about a member who was diagnosed with terminal cancer and was attempting to get his affairs in order for his wife and children," Hughes wrote. "One of the financial issues was refinancing his home. Our manager came to me with a request and I could tell by her voice she seemed to have little hope of gaining my support.
 
"She wondered if I could support refunding part of the origination fee we were collecting on the refinanced loan. It did not take me long to respond. I told her to refund the whole fee and try to convince the member to buy loan protection insurance with the money. She did just that and he accepted her advice and lived long enough for his family to receive the principal reduction on the mortgage.
 
"She asked me why I was willing to support this when so many times I was not willing to do so," Hughes wrote. "I told her it was because of the times I said no that now allowed me to say yes when the need was real and significant."
 
To download, the paper use the link.

Wis. CU lending increases 9.6%, DFI reports

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MADISON (8/13/14)--Wisconsin's state-chartered credit unions experienced a jump in loan growth of 9.6% in the first half of the year, according to the Department of Financial Institutions.
 
"State-chartered credit unions had another very healthy quarter," DFI Secretary Peter Bildsten said. "Year-over-year loan growth was surprisingly strong, yet net worth and income levels remain very solid."
 
Net income also rose--8.4% year-over-year--at Wisconsin's 166 state-chartered credit unions.
 
In the six months ending June 30:
  • Net income was $119.6 million, compared with $110.3 million in the first six months of 2013;
  • Total loans were just under $19 billion, compared with $17.3 billion last year;
  • The delinquent loan ratio stood at 0.98%, down from 1.26%; and
  • Net worth climbed to 10.64%, up from 10.28%.
Kim Santos, director of the Office of Credit Unions, noted that loan quality continues to get stronger. "Delinquent loan expense declined by more than 33%, year over year, and delinquent loan ratios are now at pre-recession levels," Santos said. "That's a very encouraging sign."

U.K. CUs heeding archbishop's advice

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LONDON (8/13/14)--In July 2013, the Archbishop of Canterbury, the Most Rev. Justin Welby, 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. He told the payday lender Wonga that he wanted to put it out of business by using the Church of England to promote credit unions.
 
It appears that citizens of the U.K. do indeed value credit union services. New data published by the Bank of England shows continued uninterrupted growth for the credit union movement in England, Scotland and Wales, according to the Association of British Credit Unions.
 
The audited figures covering the financial year to September 2013 confirm that Britain's credit unions now serve more than 1 million people and have assets worth more than 1 billion pounds ($1.68 billion).
 
Since 2004, credit union membership has increased by 90%, lending has more than doubled and savings have increased by 138%.
 
As of last September, credit unions in England served 657,737 members, with 506 million pounds ($849 million) in savings and 369 million pounds ($619 million) out on loan.
 
Scotland's credit unions served 343,437 members--6.4% of the total Scottish population--with 376 million pounds ($631 million) in savings and 255 million pounds ($427 million) in loans.
 
The data also shows Welsh credit unions served 69,151 members, with 27 million pounds ($45 million) in savings and 15 million pounds $25 million on loan.

Bankrate: Closing costs on the rise, CUs hold steady

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NEW YORK (8/13/14)--Consumers are paying higher fees related to closing costs for the second straight year, a closing cost survey from Bankrate.com has found. Some credit unions, though, are trying to keep those costs down.

U.S. homeowners in the past year who secured a $200,000 mortgage paid an average of $2,539 in lender and third-party fees, such as appraisal services, the survey found--a number that sits 5.7% higher year-over-year.

Origination fees, which get paid directly to the lender, leapt 8.5%.

Texas recorded the most expensive closing costs at an average of $3,046 on a $200,000 mortgage, with Alaska and New York not far behind at second and third in the nation.

In the wake of the housing crash, the Federal government has ramped up regulations pertaining to lending practices, many of which at banks came under much scrutiny in the years following the downturn.

The development, which produced the qualified mortgage (QM) rule that essentially requires lenders to ensure the people they lend to can actually pay back the loans, could be driving closing costs higher.

But not all institutions have been inflating their charges.

SEFCU, Albany, N.Y., with $2.8 billion in assets, hasn't increased its fees in more than four years despite more stringent regulations, not to mention weaker revenue, Bob MacLasco, SEFCU mortgage services president, told the Albany Business Review (Aug. 6).

"It's been building over the past few years," MacLasco said. "We just chose not to pass that on to the borrower."

According to a recent survey by the Credit Union National Association, 17% of respondents said the new QM rule had driven down the number of first-mortgage loans their credit union is making ( News Now Aug. 7).

Further, 7% said the rule has had a strong negative impact, 27% said it has had a moderate negative impact, and 34% said it has had a minimal negative impact on the ability for credit unions members to secure a first mortgage.

CU System briefs (08/12/2014)

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  • SHREWSBURY, Mass. (8/12/14)-- Central One FCU, Shrewsbury, Mass., with $379 million in assets, has donated $25,000 to Shrewsbury Public Library Foundation for the library's Building for the Future capital campaign to raise $1.75 million to support a $23.3 million library expansion project ( Worcester Telegram & Gazette Aug. 10). Central One's support for the effort began in the early planning phase for the project. Work on the library is slated to begin in this fall, with completion scheduled for 2016 ...
  • ROCHESTER, N.Y. (8/12/14)-- For the past five weeks, Family First FCU, Rochester, N.Y., with $140 million in assets, awarded $300 to members as part of its Member of the Week program. The campaign has been met with excitement and interest from members who never know where or when the next celebration will take place, the credit union said. Family First FCU has chosen to give back to its members in ways that create story-telling moments they can share with friends and family. The Member of the Week campaign, combined with other efforts such as Pinnacle Checking with 2% interest, and First Home Club that grants up to $7,500 towards down payment costs, are all about continuously improving the member experience and creating lasting value, it added ...

Reliance on cash costs underserved consumers more

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WASHINGTON (8/12/14)--Using cash for financial transactions costs more time and more money for America's underbanked and unbanked consumers, according to a recent report from the Center for Financial Services Innovation (CFSI).
 
CFSI released the Massachusetts Institute of Technology research, "The Technology to Advance Equal Financial Opportunity," which looked at noncash payments such as payroll cards, mobile payments or prepaid cards.
 
"There is a high cost of living without access to high-quality financial services," said Jeanne Hogarth, CFSI vice president of policy. The Federal Deposit Insurance Corp. estimates about 30% of Americans and up to 50% of Latino and African-American households use cash for the majority of their financial transactions.
 
The report cited the work of Latino Community CU, Durham, N.C., with $144 million in assets, of serving the unbanked. More than three-quarters of its members were previously unbanked and had never had any relationship with financial institutions prior to becoming a member.
 
The MIT study also noted El Paso (Texas) Credit Union for Affordable Housing (EPCUAH) credit union service organization, which provides thorough financial education as it integrates consumers into the financial mainstream. EPCUAH also looks at rent and utility payment histories to assess delinquencies that more often than not were due to extenuating circumstances such as unemployment or medical emergencies. Once those trials passed, most households returned to on-time payments, EPCUAH found.

Among the report's findings:
  • Unbanked or underbanked consumers expend more time cashing checks and making payments, spend more money on fees, have limited access to goods and services, and are more vulnerable to crime. While the average adult spends 28 minutes per month accessing cash, or 5.6 hours per year, the unbanked are 50% more likely to pay higher time-costs for cash access. "Unfortunately, low-income individuals and communities have the most to lose because they can least afford the time, money, and vulnerability associated with the cash economy," the report noted.
  • Being included in the financial environment now doesn't require a relationship with a traditional financial institution. Cash-loaded cards such as prepaid debit cards, payroll cards or public benefit cards reduce the need to be an accountholder. "Advances in technology allow consumers to access financial services with greater convenience and confidence--without being required to navigate mainstream financial institutions," said the report.
  • Digital payment technology can reduce the amount of time the unbanked or underbanked spend performing financial transactions. Receiving payments, paying bills and transferring funds electronically reduces fees and lessens the risk of theft.
  • Community institutions such as credit unions can help overcome the cultural, financial and logistical barriers perceived by the underserved populations. "Products, services and educational resources can all be developed and tailored to provide the greatest benefit and value to the financially underserved when communities, nonprofits, and businesses work together," the report said.

BayPort CU offers love, money advice

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PORTSMOUTH, Va. (8/12/14)--Whether a romantic couple wants to admit or not, financial situations are an inherent part of the relationship equation.

Viewers of a recent episode of The Hampton Roads Show , which is broadcast on WAVY-TV in northeastern North Carolina and Virginia, received a little advice on how couples can solve that money equation from BayPort CU's Vice President of Finance Lewis Smith, who appeared as a guest.



Lewis, who was celebrating his 26th anniversary with his wife the day of the show, said couples can tackle their mutual financial situations with a tool called "CPR," or communicate, plan and review.

"The first thing is to communicate," said Lewis, whose credit union is based out of Newport News, Va., and has $1.4 billion in assets.

"When you get in a relationship with somebody, you love everything about them, (but) 'Wait a minute, you've got a $10,000 credit card bill?'" Lewis said as an example. "A lot of times that doesn't come out until you're combining households, so that's something you have to look for. Be able to communicate up front before you even get started."

Next, it's time for couples to begin carving out a plan.

"So now we've discussed it and we realize we've got debt we've got to deal with," Lewis said. "One of the things you can do is come up with a spending plan."

That plan can include decisions about how much to put away into savings, how much to put into a 401(K) and even whether the couple would like to open a joint checking account, Lewis said.

Lewis added that this should be an ongoing conversation.

Finally, after the plan has been in practice for a period of time, it's important for the couple to sit down and review how well the plan is working, and then be willing to make any necessary adjustments.

"The important thing to remember is that you're on the same team, that you're sitting side by side and having the discussion, not opposite the table as an adversary," Lewis said. "If you do that hopefully you're on the road to (financial stability)."

61 CU professionals graduate from CUNA Management School

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MADISON, Wis. (8/12/14)--Upon the July completion of CUNA Management School, 61 credit union professionals earned the Certified Credit Union Executive (CCUE) designation.
 
The 2014 graduating class brings the total number of designees to more than 3,300 nationwide.
 
CUNA Management School, a three-year program held in cooperation with the Graduate School of Business at the University of Wisconsin-Madison, cultivates leadership in current and future credit union managers through a blended curriculum of university classes and experiential learning.
 
"I've run this program for four years, and without fail, I'm amazed by the passionate, committed faces that greet me on the UW-Madison campus each July," said Meghann Dawson, director, CUNA Management School. "It's been an honor to work with this year's graduates over the past few years. Each and every one of them has more than earned their CCUE designation and the recognition that it will bring."
 
Of this year's 61 graduates, 33 graduated with honors and two graduated with high honors.
 
The CCUE designation, instituted in 1975, is designed for those aspiring to credit union leadership and recognizes commitment to the credit union movement.
 
The class presented $21,400.53--raised over the course of its three-year tenure--to the CMS Scholarship Fund during its graduation ceremony. The scholarship fund helps smaller credit unions and individuals without available financial resources to become future CUNA Management School graduates.
 
This year's Al Jordan Leadership Award went to Randy Turpin, director of branch operations, 121 Financial CU, Jacksonville, Fla., with $449 million in assets. Each year, the senior class nominates one student who best represents high moral character, leadership, credit union dedication and academic achievement to receive this award. It honors credit union pioneer Al Jordan, valedictorian of the 1954 inaugural class of CUNA Management School and Iowa Credit Union League president from 1954 to 1981.

Don't overlook CUs, says LendKey CEO in Inc. magazine

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NEW YORK (8/12/14)--The credit union movement received a glowing review in an edition of entrepreneur-centric Inc. magazine recently that demonstrated, once again, the advantages offered by the member-owned institutions.

Vince Passione, columnist for the magazine and founder/CEO of LendKey, a cloud-based lending operation and CUNA Strategic Services alliance provider, said in the article that when comparing banks and credit unions, there really is no comparison.

"Each of the U.S.' four largest banks is actually larger than all of the credit unions combined," said Passione in his Aug. 8 column, as banks overall hold roughly 14 times more in assets than credit unions at $14.7 trillion vs. $1.1 trillion.

Further, Passione said that while credit unions are much smaller than banks, the movement continues to gain steam, highlighting the industry's recent accomplishment of reaching 100 million memberships in the United States.

And there are a variety of reasons for the ongoing upturn in credit union growth.

"Nonprofit credit unions generally offer better savings and loan rates, and low or no fees," Passione said. "For example, as of March, the average rate on a 36-month new car loan was 2.76% at credit unions and 5.43% at banks.

"Credit unions are usually smaller operations than the big banks and are able to pass on these savings to customers."

Passione also explained how credit unions, despite their smaller size, are more stable and sound financial institutions than banks.

When the housing bubble burst, commercial banks failed at a rate nearly three times that of credit unions--at 60% to 23%--and since the recession credit unions continue to become healthier, Passione said.

To read the full column, use the link.

Luck, preparation helps Hawaii's CUs escape hurricanes

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HONOLULU (8/12/14)--A combination of good luck and preparation helped Hawaii's credit unions escape from last week's hurricanes unscathed.
 
Several credit unions were closed throughout the islands Thursday and Friday because of high winds and storms resulting from hurricanes Julio and Iselle, but the majority returned to normal operating hours Saturday, the Hawaii League of Credit Unions reported. None were damaged, the league added.
 
Hurricane Iselle had the most impact, striking the island of Hawaii as a Category 1 hurricane Thursday. The island was largely shielded by the presence of two large mountains, Mauna Kea and Mauna Loa, according to Reed Kano, the league's finance manager. Iselle later weakened to a tropical storm and traveled south of the island chain. 
 
Hurricane Julio traveled north of the Hawaiian Islands and had no effect on the islands except for high surf.
 
Hawaii's credit unions were prepared for the storms, Kano informed News Now via e-mail.
 
"In hindsight, the most important aspect of preparedness is good communications, keeping abreast of the approaching storms, reporting to state agencies and National Credit Union Administration, and post-damage assessments," Kano said. "Our member credit unions communicated with Hawaii Credit Union League as well as each other to obtain information as well as guidance."
 
Kano said credit unions also used social media extensively to update members and employees throughout the week.

Suncoast CU's Lewis named NYIB chair

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TAMPA, Fla. (8/12/14)--Juli Lewis, youth marketing manager for Suncoast CU, Tampa, Fla., with $5.7 billion in assets, was elected chair of the National Youth Involvement Board (NYIB) for 2014-15 during the organization's annual meeting in Grand Rapids, Mich., earlier this month.

An employee of Suncoast CU for 21 years, Lewis has been active with the NYIB since 2006. The NYIB, comprised of a network of youth advocates, serves as a resource to help credit unions reach youth demographics. 

In addition to Lewis' election, the NYIB also named two new regional coordinators and re-elected one regional coordinator at the meeting.

The new NYIB regional coordinators, who will serve two-year terms, are:
  • Southwest: Amanda Merz, financial education coordinator, SAFE CU, North Highlands, Calif., with $2.1 billion in assets; and
     
  • Southeast: Kelli Holloway, member education specialist, SECU, Raleigh, N.C., with $28 billion in assets.
Mandy Clayton, director of financial education, FivePoint CU, Nederland, Texas, with $463 million in assets, was re-elected as the southcentral region director.

Continuing their two-year terms as directors are:
  • Northwest: Shannon Cahoon, community outreach coordinator, Fibre FCU, Longview, Wash., with $771 million in assets;
     
  • Northcentral: Ashley Buchholz, marketing specialist, Wildfire CU, Saginaw, Mich., with $689 million in assets; and
     
  • Northeast: Leah Esslinger-Sprowl, high school manager and youth educator, Holy Rosary CU, Rochester, N.H., with $203 million in assets.

$300K raised for CUs Kids at Heart

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BURLINGTON, Mass. (8/12/14)--More than 50 credit unions have donated a collective $300,000 to Credit Unions Kids at Heart (CU K@H) to fight childhood illness.
 
CU K@H is a collaborative community service activity founded by Eastern Corporate FCU (EasCorp), Burlington, Mass., in 1996. Including its most recent donation, the CU K@H program and its team of dedicated supporters have raised more than $4.3 million to fund various pediatric research projects.
 
Funds from the 2014 campaign have been earmarked to support several pediatric brain research projects, including the search for treatments, therapies and cures for Moyamoya disease, Sturge-Weber syndrome and brain tumors. This research is used by pediatric hospitals and other care centers all around the world. CU K@H's partner in this program is Boston Children's Hospital, a leading pediatric research center where scientists have set the standard in treating and finding cures for many debilitating diseases. 
 
The cornerstone of CU K@H's annual fundraising efforts is the Boston Marathon. Although the Boston Marathon is a qualifying time race in which acceptance of participants is based on qualifying times according to age groups and gender, CU K@H Program is able to procure several of the limited entries awarded for charitable fundraising purposes.

As their inspiration for training and finishing the race, CU K@H Marathon Team runners are individually paired with patient partners from Boston Children's Hospital.
 
Many of the patient partners have extraordinary medical challenges, but they also possess great spirit, faith and enduring courage, CU K@H said. These children, who overcome their own challenges every day, inspire the runners to train throughout the Boston Marathon season. The children are equally inspired by the runners who relentlessly train throughout the winter months that lead up to the race. Runners and patient partners often form a special bond that endures well beyond the marathon season.

Maine CUs focus on hunger relief for out-of-school kids

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WESTBROOK, Maine (8/12/14)--The Maine Credit Union League distributed $17,000 to 33 hunger relief agencies during its 10th annual "Share the Bread" event.
 
"Share the Bread" focuses on the acute need for food for Maine's 65,000 schoolchildren who may not have access to the same meals that they receive when school is in session.
 
"When people think of summer in Maine, they usually think about taking vacations and being outdoors; helping the local food pantry is often the furthest thing from their minds at this time of year," said Jon Paradise, vice president of governmental affairs and public relations, Maine Credit Union League. "Sadly, summer is a hungry time for Mainers just like any other time of the year, except it doesn't get the same attention as it does around the holidays."
 
Maine Credit Unions' Campaign for Ending Hunger distributed donations and bread during the one-day event.
 
"'Share the Bread' is kind of a play on words," Paradise told WABI-TV (Aug. 4). "We're giving away loaves of bread, and we're giving away the other kind of bread to kind of share the spirit with what credit unions are all about--that's helping communities and part of helping communities is helping to end hunger in the state."
 
The hunger relief effort has raised $5.3 million since 1990 including a record-setting $513,000 in 2013.

Minn. foundation touts success of student-run CUs

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ST. PAUL, Minn. (8/11/14)--Credit unions in Minnesota have been at the forefront of introducing student-run credit union branches in schools, a trend growing ever more popular throughout the United States.

That's why it's no surprise representatives of the Minnesota Credit Union Foundation (MCUF) were asked to speak about the in-school operations at the Minnesota Council on Economic Education Conference Aug. 5, which focused on economics and personal financial education.

The conference allowed Kristina Wright, MCUF executive director, to highlight the partnerships that have formed between credit unions and schools throughout the state, as well as to emphasize that opportunities exist for credit unions to help teachers comply with financial education standards.

In May 2013, the state mandated higher standards in financial literacy for all K-12 students with a focus on subjects such as weighing wants and needs, creating budgets, establishing savings goals and understanding the importance of credit.

"Credit unions across the state and across the country are dedicated to educating their members and making them smarter, wiser consumers," said Wright during a breakout session at the conference called "Educational Benefits of Student-Run Credit Unions." The session served as an introductory overview of how student-run branches work.

"Typically, relationships start small--by making connections or through guest-speaking in the classroom--and from there doors naturally begin to open," Wright said.

About 268 credit unions have partnered with local schools throughout the United States to open up in-school student-run branches, according to numbers from the Credit Union National Association.

Five in-school branches have opened in Minnesota schools since 2011 thanks to credit unions in the state, including Home Town CU, Owatonna, Minn., with $113 million in assets; St. Paul (Minn.) FCU, with $130 million in assets; Ideal CU, Woodbury, Minn., with $568 million in assets; and Cook (Minn.) Area CU, with $29 million in assets.

"These credit unions have put forth tremendous effort in implementing their student-run branches, and it's fascinating to see how no two models are exactly like," Wright said. "Their commitment and contributions to their communities will have a lasting impact on students and their families."

CU System briefs (08/11/2014)

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  • POTTSTOWN, Pa. (8/11/14)-- The commitment to Relay for Life shines brightly at Diamond CU, Pottstown, Pa., which has raised more than $77,000 for the American Cancer Society this year alone. Over the past nine years, the $436 million-asset credit union has raised $566,090 for the Pottstown and Berks County Relay for Life events. In addition to overall fundraisers such as golf, bingo, wine tastings, hot dogs and bake sales, the credit union pledged $20 to the Boyertown Relay for each new checking account opened at that branch for its grand opening month of May. Employees celebrate at the Pottstown Relay for Life, where it was a corporate sponsor (Diamond CU Photo) ...
  • OLYMPIA, Wash. (8/11/14)-- When Thurston County, Wash., banned plastic bags, Washington State Employees CU, Olympia, took the opportunity to offer its members branded reusable bags. The $2 billion-asset credit union asked of its members one thing--a $1 donation per bag that would be matched by the credit union. The result of the two-week promotion was a donation of more than $1,500 to Garden Raised Bounty , an Olympia nonprofit organization working on food sustainability issues with a particular emphasis on youth involvement. "It just hit me that we should capitalize on this ordinance change and in one fell swoop we could help members, market the credit union and support a great local partner," said Vice President of Public Relations Ann Flannigan, who added that the members didn't hesitate to donate ...
  • BALTIMORE (8/11/14)-- D. Kent Parker, who helped establish and implement the 911 system in Baltimore, died Aug. 3 ( The Baltimore Sun Aug. 7). He was 77. Parker was a founding member of Baltimore County Employee CU, Towson, Md ., which now has $339 million in assets. He served on the board for 32 years ...

Story of a small-CU CEO: 'I basically do everything'

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MEMPHIS, Tenn. (8/11/14)--At a small, select-employee-group credit union, one employee may be a jack of all trades, and at Delta Refining Co. Employees FCU, Memphis, Tenn., that person is CEO Terrie Snavely.
 
"I basically do everything," she told the Memphis Business Journal (Aug. 8). That includes--take a deep breath--all accounting duties; teller activities such as deposits, withdrawals, and opening and closing accounts; processing loans; managing investments; maintaining the credit union budget and goals; collections; marketing; data processing/information technology; human resources; and financial counseling.
 
The $4.6 million-asset credit union does have its own personality, she said, adding, "We are here to serve a specific group and their individual needs."
 
Because the credit union is located at the refinery where its members work, it has adapted to serve them. "It's not always possible for them to make it to their financial institution during regular business hours. Sometimes we will make a trip to their office to do business," Snavely told the Journal . The credit union also has hours that allow the night-shift workers at Valero to use its services.
 
Snavely prides herself on the fact that the credit union often has personal knowledge of an individual's needs and their ability to repay.
 
"Before giving you a loan, we go over your debt ratio and give you options," she said. "We love to make loans to our members, but we also don't want them to stretch themselves out too thin.
 
"We know our members, we know when they have had a financial or personal hardship, and we can provide personal services based on the needs of the member."
 
Half of all U.S. credit unions have less than $24 million in assets, according to statistics from the Credit Union National Association.

CU Resources consultant: HR audits protect your organization

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FARMERS BRANCH, Texas (8/11/14)--The Equal Opportunity Employment Commission investigated 93,000 charges of discrimination claims in 2013, with retaliation claims accounting for 41% of all charges. Credit unions are not immune from such exposure, a Credit Union Resources consultant told the Cornerstone Credit Union League.
 
Credit unions can reduce their risk by ensuring they have practices and policies in place to effectively handle any adverse action toward an employee, said Kimberly Jones, a human resources consultant with Credit Union Resources, which is a subsidiary of the league ( Leaguer Aug. 8)
 
"Workplace retaliation claims are becoming increasingly more common and more expensive for employers," said Jones. "In order to protect your organization against retaliation lawsuits, it is imperative that you be proactive and not reactive."
 
A human resources (HR) audit is one proactive measure credit unions can take to minimize exposure to discrimination and retaliation charges, Jones said. An HR audit sets the stage in determining if the HR functions within the credit union are compliant, fair, adequate, and effective. The results of an audit can provide credit unions with the information necessary to decide what areas need improvement.
 
An HR audit should include a review of policies and procedures, employee files, forms, salary programs and other human resources areas. Credit Union Resources also provides credit unions with a written summary of the assessment and recommendations on those areas that may need to be changed or improved.
 
"Retaliation claims are easier to prove than other discrimination charges, and successful retaliation claims can be very expensive for an organization," Jones said. "An HR audit is customized to meet your specific needs, and can be a powerful tool in assessing regulatory and policy compliance in your organization."

Mass. gov. signs CU share insurance corp. bill into law

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MARLBOROUGH, Mass. (8/11/14)--Massachusetts Gov. Deval Patrick last week signed legislation that gives great investment authority to the Massachusetts Credit Union Share Insurance Corp., the Massachusetts Credit Union League reported.
 
House Bill 4112, An Act Relative to the Massachusetts Credit Union Share Insurance Corp., authorizes ownership of real estate and creation of subsidiaries, expands investment authority to include the investments under the "prudent man" authority upon application to the commissioner of banks not to exceed 20% of assets, and permits investments in credit union service organizations ( Daily CU Scan Aug. 8).
 
Two bills supported by the league advanced through the House during the formal session. House Bill 4139 expands branching limitation miles to 100 miles from 50 miles and also allows for regional interstate branching. House Bill 3954 streamlines the petition process for the commissioner of banks to add permissible investments for state-chartered credit unions. Both bills are well-positioned to further advance to enactment during the informal session, the league reported.
 
The Massachusetts General Court operates on a two-year legislative calendar. Under the Joint Rules of the Legislature, the formal legislative session must end on July 31 of the second year. In August of the second year, full, formal sessions of the House of Representatives and Senate have concluded for the 2013-2014 legislative session. However, both chambers continue to meet twice a week in informal sessions to consider local and noncontroversial matters until the end of the calendar year.

Benefits of U.S. CUs go global in The Guardian

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LONDON (8/11/14)--Banks are leaving poor Americans behind, but those neglected consumers can find a willing financial institution in credit unions, said a recent article in The Guardian about recent credit union growth. 

Credit Union National Association interim Chief Economist Mike Schenk was cited by the British publication that part of the reason credit unions have performed well recently--with membership climbing 2.9% this year and overall memberships topping 100 million this month--is that banks are ratcheting up fees and charges.

The Guardian in its Aug. 8 article takes it even further.  

"Many Americans are not banks' ideal customers, not enough money, not enough transactions, and they are punished for it with a barrage of fees," the article said. "In some cases, they are denied bank accounts altogether."

When bank fees disproportionately hurt those who don't have any reserve income, or when banks levy fees for not having enough money in the first place, or when banks charge service fees simply to maintain a checking account, for many Americans, banks simply aren't a financially viable option, the article said.

But that's where credit unions can step in.

Nearly three-quarters of the largest credit unions in the United States offer free checking to members, according to Bankrate's 2014 Credit Union Checking survey, The Guardian reported.

At banks, only 38% offer free checking accounts.

"Banks are in the business of making money," the article said. "Poor Americans are not a good bet for them, they have too little money. It's not the consumers who are turning their back on the banks. It's the banks who did it first.

"Left out in the cold, they go to the one place that welcomes whatever little amounts of money they have: credit unions."

PCI Council offers guidance on 3rd-party contracts

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PRINCETON, N.J. (8/11/14)--The Payment Card Industry (PCI) Data Security Standards Council has issued guidance to help financial institutions and retailers minimize the risk associated with third-party contracts and payment breaches.
 
Among the areas covered in the guidance are third-party due diligence, service provider requirements and compliance and written agreement policies and procedures.
 
About 65% of data breaches involve a third party, PCI Council Chief Technology Officer Troy Leach told Bank Info Security (Aug. 7).
 
"The use of a third-party service providers (TPSP) does not relieve the entity of ultimate responsibility for its own PCI compliance, or exempt the entity from accountability and obligation for ensuring that its cardholder data and card holder data environment are secure," the paper said. "Clear policies and procedures should therefore be established between the entity and its TPSPs for all applicable security requirements, and proper measures should be developed to manage and report on the requirements."
 
Because about 45% of card breaches involve retailers, Leach said the council decided to offer additional guidance on PCI obligations related to third-party contracts and services.
 
The guidance addresses best practices rather than new requirements, Leach said.
 
To listen to a Bank Info Security interview with Leach, use the link.

Fed report: Quarter of Americans 'just getting by'

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WASHINGTON (8/8/14)--The effects of the Great Recession continue to haunt U.S. consumers. About a quarter of U.S. families reported they were "just getting by" financially, while 13% described themselves as struggling, according to a new Federal Reserve report released on Thursday.
 
Another 34% percent said they were worse off financially than in 2008 at the start of the Great Recession. Thirty-four percent said they were about the same. Thirty percent said they were better off, according to the report.

This aligns with the Credit Union National Association's 2014-2015 National Member and Nonmember Survey. The recently released report asked consumers to compare their current financial status to that of two years ago. About 20% said they were worse off, 42% were about the same and just under 40% of members said they are better offer now.
 
While 31% of the Fed survey respondents had applied for some type of credit in the prior 12 months, one-third of those who applied were turned down or given less credit than they applied for. Another 19% of respondents put off applying for credit because they thought they would be turned down.
 
The survey results also suggest that many households are not adequately prepared for retirement. Thirty-one percent of non-retired respondents reported having no retirement savings or pension, including 19% of those age 55 to 64.
 
Almost half of adults were not actively thinking about financial planning for retirement, with 24% saying they had given only a little thought to financial planning for their retirement and another 25% saying they had done no planning at all. Of those who have given at least some thought to retirement planning and plan to retire at some point, 25% didn't know how they will pay their expenses in retirement.
 
The Great Recession pushed back the planned date of retirement for two-fifths of those age 45 and over who had not yet retired, and 15% of those who had retired since 2008 reported that they retired earlier than planned due to the recession.
 
Among those age 55 to 64 who had not yet retired, only 18% planned to follow the traditional retirement model of working full-time until a set date and then stop working altogether, while 24% expected to keep working as long as possible, 18% expected to retire and then work a part-time job, and 9% expected to retire and then become self-employed.

Summer events spread Mich. CU Link awareness campaign

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LANSING, Mich. (8/8/14)--Michigan credit unions are supporting the CU Link Cooperative Advertising program by helping state residents enjoy the Midwestern summer.
 
CU Link Michigan is a sponsor of the U.P. State Fair Aug. 11-17 in Escanaba, the Michigan Credit Union League (MCUL) reported ( Monitor July 31). As part of its sponsorship, CU Link Michigan will have a booth onsite during the weekend of the fair. CU Link Michigan will offer a raffle featuring a "Made in Michigan" gift basket with items from U.P. vendors.
 
CU Link Michigan also is a sponsor at the seventh annual Microbrew and Music Festival, Aug. 22-23 in Traverse City ( Monitor Aug. 6). As part of credit unions' sponsorship, CU Link Michigan will have a booth onsite during festival.
 
For both events, MCUL is encouraging credit unions to participate by manning the boots and bringing materials to increase awareness about their own credit union.

In total, more than 164 credit unions contributed nearly $1.11 million to this CU Link campaign--surpassing 2013's total.

CU System briefs (08/08/2014)

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  • COLUMBIA, Md., and WASHINGTON (8/8/14)-- The Maryland and District of Columbia Credit Union Association appointed Bernard McLaughlin, CEO, Point Breeze CU, $737 million in assets, to its board . McLaughlin will also serve as vice chair of the advocacy committee. He replaces board member Robert Windsor, who retired June 20 from First Financial of Maryland FCU, Lutherville, Md., with $1 billion in assets ...
     
  • MASSENA, N.Y. (8/8/14)-- To help an A-4 Skyhawk fighter plane make its final home in Brasher Falls, N.Y., SeaComm FCU donated an additional $10,000 to the "Bringing the A-4 Home" fund, putting its total support at $15,000 ( North Country This Week Aug. 7.).  The $476 million-asset credit union, which is based in Massena, N.Y., is backing a $75,000 campaign to bring the Vietnam War-era plane to downtown Brasher Falls as a tribute to area veterans. Organizers have reached the $30,000 mark needed to transport the plane to New York from Florida ( Watertown Daily Times July 15) ...
     
  • LAWRENCE, Mass. (8/8/14)-- Merrimack Valley FCU, Lawrence, Mass., treated members and employees with a visit from John's Ice Cream Truck to all branches and the corporate office of the $510 million-asset credit union. "We try to surprise our employees every month with a little something to let them know we appreciate their hard work. We hope it makes their day a little better," said President/CEO Peter Matthews ( Daily CU Scan Aug. 7). "It's nice when your employer takes some time out to acknowledge you ... especially with ice cream!" said Lawrence branch employee Susan Griffin, who picked up her treat at the truck last week (Merrimack Valley FCU Photo) ...

CU mergers changing face of local markets

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MADISON, Wis. (8/8/14)--As credit unions continue to merge, operating landscapes begin to shift. In Florida, particularly, the ground seems to be moving daily.
 
Florida is home to some of the most recent and larger mergers. In Jacksonville, $303 million-asset State Employees CU and $412 million-asset First Florida Credit Union finalized its merger following an affirmative vote July 25 by members of State Employees CU. As of Aug. 1, the consolidated credit union is operating under the First Florida CU name and charter. The merger makes it the third-largest credit union in Duval County, behind $5.1 billion-asset Vystar CU and $1.2 billion-asset Community First CU.
 
Also in Jacksonville, the boards of 121 Financial CU, $449 million in assets, and Duval FCU, $52 million in assets, have agreed to merge later this year, pending membership and regulator approval. The combined credit union will operate under the 121 Financial CU name and retain employees of Duval FCU.
 
"From our prospective, it is just a logical fit to merge the two credit unions who have similar goals, similar cultures and solid long-term reputations for taking care of members on a personal level," said William Braddock, 121 Financial CEO.
 
Many of the latest merger announcements include the benefits of a shared culture of member service as well as expanded products and services.
 
On Tuesday, members of Education Affiliates FCU, New York, approved a merger with McGraw-Hill FCU, East Windsor, N.J., with $311 million in assets. The $50 million-asset credit union was founded in 1979 to serve the instructional and managerial staff of the City University of New York and has since added the Fashion Institute of Technology and Marymount Manhattan College, among others. "This merger brings together two organizations that share the same mission and purpose--supporting our members' financial health and wellness," said Shawn Gilfedder, McGraw-Hill FCU president/CEO.
 
In California, members of South Western FCU, La Habra, with $129 million in assets, approved its merger with CU of Southern California (CU SoCAL), Whittier, with $742 million in assets. Effective Oct. 1, the resulting credit union will have 13 branch locations and will serve more than 70,000 members in Chino, Chino Hills, Ontario and San Bernardino, and Orange and Los Angeles counties.
 
"This partnership brings our members many immediate benefits including access to longer member service hours and expanded product offerings," said Laura Poore, CEO of South Western FCU. CU SoCal President/CEO Dave Gunderson will be president/CEO of the merged credit union.
 
In November, Ameritas Employees CU, Lincoln, Neb., with $16 million in assets, will merge with MembersOwn CU, Lincoln, Neb., with $86 million in assets. The merger of the more than 60-year-old Ameritas Employees CU has been approved by members and regulators ( Lincoln Journal Star Aug. 6).

Retail credit card interest rates far exceed CUs'

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MADISON, Wis. (8/8/14)--Consumers may want to think twice before signing up for a retailer-issued credit card--and instead stick with a credit union card--especially if they don't expect to pay off their balances in full and on time.

The average annual interest rate on credit cards from the nation's largest retailers has climbed by more than 2 percentage points in recent years up to a whopping 23%, according to a CreditCards.com survey.

Zales recorded the highest annual percentage rate among those polled at 28.99%; OfficeMax recorded the lowest at 9.99%; and Toys R Us/Babies R Us saw the biggest increase, with a 5.75% jump up to 26.99% overall.

Credit unions, meanwhile, posted an average interest rate of 9.17% as of Aug. 7, according to Informa Research Services, which is also nearly 2% better than the average bank interest rate on credit cards.

Despite retail credit cards carrying higher interest rates, however, consumers still frequently opt to use them. The Federal Reserve reports that private-label retail cards comprised about $270 billion in sales last year, according to CreditCards.com .

Rewards programs offered by the stores could be incentivizing consumers to stick with their cards, as the survey discovered many retailers have expanded their credit card products to feature a wider selection of discounts and rewards.

"In all, the survey portrays a market segment that is offering better rewards to consumers who can pay off their shopping sprees, and bigger debts to those who don't," Sienna Kossman wrote on CreditCards.com (Aug. 7).

Credit unions offer reward programs tied to their credit cards as well. About 55% of credit unions that offer platinum/titanium cards offer rewards programs, and 40% of those with gold programs feature rewards, according to the Credit Union National Association's 2013-14 Fees Report.

Additionally, larger credit unions are more likely to offer rewards programs, with 70% to 80% of credit unions with more than $500 million in assets carrying credit cards that feature rewards.

Only 1% of all credit unions charge fees for the reward programs.

Mobile banking opportunity to increase member loyalty: FICO

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SAN JOSE, Calif. (8/8/14)--Offer mobile banking services, receive a higher satisfaction rating from members and consumers. That was one of the key findings of a recent customer survey by FICO, which looked at how consumers interact with their financial institutions.

More than 80% of consumers who have access to mobile banking services at their financial institution said they were satisfied with their bank, while 71% of those who don't have access said they were satisfied.

Further, 76% of mobile app users would likely recommend their financial institution to others, while only 67% of those who don't use mobile banking would do so.

"Mobile apps present a tremendous opportunity for banks to grow customer loyalty and add value," said David Vonk, head of FICO's North American banking practice. "Banks that have made the mobile investment need to encourage their customers to actually use their mobile app, especially as busy consumers, especially millennials, use smartphones and tablets to manage all aspects of their lives."

Credit unions appear to be adapting to the evolution in how their members prefer to manage their finances. The Credit Union National Association found in a recent Technology Spending Survey that nearly 50% of credit unions beefed up their technology budgets this year compared with 2013 ( News Now May 28).

On average, technology comprises 6.7% of noninterest expenses at a credit union, according to the survey. And just about all credit unions who responded to the survey offer mobile banking, at 97% ( CU Magazine June).

The FICO survey, which polled 991 consumers in early March, also revealed the rate at which different demographics use mobile banking.

Of those polled, 70% of millennials said they use mobile banking apps, compared with 54% of consumers age 35 to 49 and 36% of consumers age 50 and older.

CU System briefs (08/07/2014)

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  • HONOLULU (8/7/14)-- Aloha Pacific FCU, Honolulu, with $755 million in assets, awarded 15 student scholarships worth a total of $30,000 from the Masami Oishi Memorial Scholarship Fund. Each student received a $2,000 cash scholarship and a credit union backpack filled with gifts ( League News Aug. 4). The scholarship fund is named in honor of the late Masami "Masa" Oishi, who was the credit union's first manager. He served in that position for 27 years ...
     
  • ARLINGTON, Va. (8/7/14)-- Rose Conner, administrator of the North Carolina Credit Union Division, has been appointed to the National Association of State Credit Union Supervisors (NASCUS) board. Conner replaces Utah regulator Orla Beth Peck, who retired Aug. 1 from her position as supervisor of credit unions with the Utah Department of Financial Institutions (DFI). Peck was NASCUS board chair from 2011 to 2013 and worked for DFI for 33 years. She will be succeeded by Riley Bergstedt, who has worked at DFI for 16 years, most recently as a senior examiner ( Association Update Aug. 4) ...

Lending excellence award deadline is Sept. 8

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MADISON, Wis. (8/7/14)--The 15th annual Excellence in Lending Awards, sponsored by the CUNA Lending Council and CUNA Mutual Group, will accept entries through Sept. 8.
 
The program recognizes credit unions for their ability to serve members while sustaining sound financial performance.
 
Credit unions may be nominated for the 2014 award in the following categories:
  • Consumer lending, less than $250 million in assets and more than $250 million in assets;
  • Mortgage lending, less than $250 million in assets and more than $250 million in assets;
  • Low/modest means lending, any asset size; and
  • Business lending, any asset size.
 
The Excellence in Lending Awards will be presented at the CUNA Lending Council's 20th annual conference Nov. 2-5 in San Diego. Airfare, hotel and conference registration for one representative of each of the winning credit unions is included with the award.
 
For more information and applications, use the resource link.

Members 'LIFT' credit score with Filene on-time payment pilot

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MADISON, Wis. (8/7/14)--A new research paper from the Filene Research Institute explores the results of a lending program pilot that operates on the principles of rewards and encouragement for payment rather than punishment and pain for delinquency.

LIFT (Lower Interest for Timeliness), a program developed by Filene's i3 innovation team, is a simple loan feature that reduces loan interest rates when members make on-time payments. By giving borrowers a chance to earn their way to more affordable credit, LIFT is designed to help credit unions drive down delinquency, improve member satisfaction and gain confidence in lending to riskier borrowers.
 
With the assistance of a grant from the Center for Financial Services Innovation, Filene was able to build and test LIFT with five credit unions (data from one the credit unions was unusable) and more than 1,000 low- to moderate-income consumers with subprime credit scores. The LIFT feature was applied to automobile loans because credit unions generally generate high volumes of these types of loans and they are relatively easy to administer.
 
The LIFT incentive is an interest rate reduction of 25 basis points. Borrowers earned the rate reduction after every three consecutive on-time payments. Over the course of the study period, borrowers could earn a maximum of four rate reductions. The rate reduction did not change the monthly payment amount; instead, the extra payment was applied to the loan principal, thus shortening the life of the loan and reducing the total amount paid by the borrower.
 
Among the findings in the report:
  • At three of the four participating credit union sites, LIFT borrowers had lower rates of late payments. The difference in the number of late payments between LIFT participants and control groups was statistically significant at two of the sites;
  • Borrowers with loans that had LIFT features had stronger positive attitudes toward their lenders, with controls in place for loan terms, total fees and penalties;
  • The rate of borrowers missing two consecutive payments was slightly lower among the treatment group borrowers at all sites, but none of the differences were statistically significant;
  • There were no measurable differences between the treatment and control groups in total dollar amount of late fees assessed; and
  • A survey of borrowers indicated that less than half (roughly 40%) of borrowers who had LIFT loans were aware of the LIFT interest rate incentive, suggesting that the effects reported in the pilot evaluation may be weaker than could occur with a more robust marketing of the program.
"Overall, the LIFT pilot suggests that borrowers--even those with chronic payment problems--do respond to positive incentives for on-time payments," the report concluded. "Expanding borrower education and marketing about LIFT product payment incentive features could further increase on-time payments."
 
To download the report, use the link.

Severe drought stresses members: CUs ready to assist

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FRESNO, Calif. (8/7/14)--Because farms in California's Central Valley produce one-fourth of the nation's food--according to the U.S. Geological Survey--the impact the enduring drought that has ravaged the region for the past few years is wide-reaching.

Click to view larger image Nearly 60% of California is in a state of exceptional drought--the most severe category. (California Credit Union League Photo)
But no place has felt the effects of one of the most rapacious droughts on record quite like the people who live and work in the Central Valley.

"Farm workers on dairies, if there's no water for the feed for the dairies, even the livestock suffer. The dairy farms, the almond growers, citrus growers, stone fruit ... it's all interrelated," Jill Bechard, CEO of $110 million-asset United Local CU, told News Now this week.

Bechard has seen first-hand the effects the drought has had on her members, many of whom work and reside in the Central Valley. As the rains have dried up, so have the work hours, the income and the job stability.

"If we don't have the water to serve all of those things, everyone suffers," said Bechard, whose Fresno-based credit union serves many labor and trade unions throughout the state. "The building trades suffer, the farms suffer, the union laborers suffer--everybody does."

Nearly 17,000 jobs and $2.2 billion will be stripped from California's economy by the end of the year, according to a report from the Central Valley-based UC Davis Center for Watershed Sciences (CU Weekly Aug. 5).

To help members get through this difficult time, United Local, like many credit unions in California, is doing whatever it can to lend a hand.

"(Our) recovery department works hand and glove with each one of our members, counseling with them, restructuring loans, TDRs (troubled debt restructuring)," Bechard told News Now.

"The department is working day and night to help people on their homes, their automobiles, anything we can to sustain them," she said.

Alan Cortum, CEO of  $46 million-asset Valley Oak CU, Three Rivers, told the California Credit Union League's CU Weekly that it's ensuring money is available for members to drill deeper water wells, or new wells entirely, to replenish depleted water supplies.

"It's expensive, up to $12,000 to $15,000 in some cases," Cortum told CU Weekly.

Linda Reese, CEO of Tucoemas FCU, Visalia, with $216 million in assets, said that while the credit union hasn't experienced a large influx of members losing their jobs or needing financial assistance, challenges could be on the horizon.

And if they are, the credit union will be ready.

"We'll have to work individually with our members to find out what their needs are," Reese told CU Weekly. "Each of (our members) has different needs. We're here to help our members. We'll do the best we can for them."

Security firm: Russian hackers nab 1.2B usernames, passwords

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NEW YORK (8/7/14)--Consumers across the globe are being encouraged to change passwords and take extra precaution with sensitive online information this week, as more than 1.2 billion username and password combinations and more than 500 million email addresses have been hijacked by a Russian crime syndicate, the largest data security breach to date ( The New York Times Aug. 5).

Confidential information was stolen from some 420,000 websites including some big-name sites and many small websites, according to Milwaukee, Wis.-based Hold Security, which has uncovered several significant attacks in recent months.

"Hackers did not just target U.S. companies, they targeted any website they could get, ranging from Fortune 500 companies to very small websites," Alex Holden, Hold Security's founder and chief information security officer, told The New York Times . "And most of these sites are still vulnerable."

Hold would not disclose the websites that had been attacked, claiming to be beholden to nondisclosure agreements, in addition to a desire to keep those companies that are still vulnerable private.

Security experts have told The Wall Street Journal , meanwhile, that breaches involving usernames and passwords are dangerous for consumers, as they often use both for multiple websites. Experts also have said the number of usernames and passwords amassed by the Russian criminals is impressive in size ( The Wall Street Journal Aug. 5).

Criminals have so far used the data to send spam on social-media accounts, according to The New York Times .

NCUF awards $45K in Biz Kid$ education grants

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MADISON, Wis. (8/7/14)--The National Credit Union Foundation (NCUF) has awarded seven Biz Kid$ grants totaling $45,000 for 2014, it announced Wednesday.
 
Biz Kid$ is a credit union-funded public television series that teaches kids about money management and entrepreneurship.
 
The grants support credit unions' efforts to integrate Biz Kid$ into its curriculum to build students' financial literacy and economic education skills.  
 
"There is a need to improve the financial literacy skills of the youth in America, and Biz Kid$ is the perfect vehicle to address that need," said Danielle Brown, NCUF director of development and donor relations. These grants "will improve the financial education of youth through the use of the Biz Kid$ program," she added.
 
The 2014 Biz Kid$ education grant projects include:
  • Buffalo (N.Y.) Metropolitan FCU, Buffalo, N.Y., with $90 million in assets, will host a teen summer financial workshop for high school students. Each workshop will include a lecture on the day's topic, activities based on Biz Kid$ lessons and a group activity;
  • Cornerstone Credit Union Foundation, the charitable arm of the Cornerstone Credit Union League, in Farmers Branch, Texas, will show educators how to teach the Biz Kid$ program. Participating teachers will implement the Biz Kid$ curriculum in their classrooms, and students will collaboratively create a business plan for a needy organization in their community;
  • DuTrac Community CU, Dubuque, Iowa, with $593 million in assets, will incorporate Biz Kid$ materials in the classrooms of its in-school credit union branch locations;
  • Kansas City (Mo.) CU, with $28 million in assets, will host quarterly financial education events for metro Kansas City public schools using Biz Kid$ materials;
  • Maps CU, Salem, Ore., with $428 million in assets, will work in partnership with Western Oregon University's College of Education to incorporate Biz Kid$ into the curriculum of elementary and middle schools;
  • Missouri Credit Union Charitable Foundation, the charitable arm of the Missouri Credit Union Association, St. Louis, will coordinate credit union professionals around the state to provide financial education using Biz Kid$ materials to students in unaccredited or provisionally accredited school districts; and
  • Tallahassee-Leon FCU, Tallahassee, Fla., with $43 million in assets, will offer a financial literacy summer camp for kids that uses Biz Kid$ episodes.
 NCUF oversees fundraising and outreach responsibilities of Biz Kid$. Over the past six years, more than 300 credit unions and affiliated organizations have raised more than $14 million that has supported the show's production, website and curriculum.

Every Biz Kid$ episode begins and ends with a narrator reminding viewers that: "Production funding for Biz Kid$ is provided by America's Credit Unions, where people are worth more than money."

Utah experiences 3 CU mergers year-to-date

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SALT LAKE CITY (8/7/14)--The Utah Credit Union Association reported three credit union mergers have occurred in the state this year as of Aug.1  
 
The mergers took place on a voluntary basis, with all credit unions based in Utah.
 
The mergers include:
  • Logan City Employees CU, Logan, with $623,000 in assets, merged with Logan Cache Rich CU, with $20 million in assets;
  • Premier Services CU, Salt Lake City, with $20.8 million in assets, merged with Cyprus FCU, West Jordan, with $656 million in assets; and
  • Deseret News Employees CU, with $1.6 million in assets, merged with American United FCU, West Jordan, with $151 million in assets.
All employees of the acquired credit unions continue to work for their new credit unions. Existing locations have remained open, and service to members has not been interrupted.
 
There are now 70 credit unions based in Utah, and five others based outside Utah with at least one branch in the state.
 
While historical records aren't clear, the number of credit unions based in Utah peaked sometime in the 1970s, at more than 300, the league reported. More than 400 credit unions have existed at some point in Utah. In recent years, five or six Utah credit unions have merged each year.

100 million memberships sparks much media attention

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MADISON, Wis. (8/7/14)--The Credit Union National Association's announcement that America's credit union membership has topped 100 million was cause for celebration, and one that was noticed by media outlets across the nation.
 
Within hours of Tuesday's announcement of the milestone, The Washington Post's WonkBlog column cited CUNA interim President/CEO Bill Hampel, who shared the numerous benefits of credit union membership such as lower fees, higher savings rates and lower loan rates as well as increased awareness and broader membership eligibility.
 
"In the old days, people would have thought 'those credit unions sound like a good deal, but I don't think I can get into one,'" Hampel told The Washington Post. Now, the article noted,  there is both greater eligibility and broader awareness.
 
News that roughly a third of Americans use credit unions quickly spread to other media outlets such as The Fiscal Times, which featured CUNA interim Chief Economist Mike Schenk, and Daily Finance. A recurring theme is the unique structure--not-for-profit, member-owned cooperative--of credit unions that gives them the ability to offer better rates and member-focused service.
 
"The long list of benefits to credit union membership is no longer one of the country's best-kept secrets," said Pat Keefe, CUNA senior vice president/chief communications officer. "Credit union products and services saved consumers $8.5 billion in 2013. That benefit goes both directly to credit union members, because members--not stockholders--are owners, and to the American consumer overall because credit unions' better pricing puts competitive heat on banks."

 
 
Hampel also made the airwaves with interviews on American Public Media's Marketplace Morning Report and Bloomberg Radio's Taking Stock. Use the links to listen to the segments.

"It took us a very long time to get here, but in the last four or five years, the growth rate of credit unions has really picked up," Hampel told Taking Stock host Pimm Fox during a 10-minute interview. "We pretty quickly went from 90 million up to 100 million."
 
Regional newspapers also tapped into state credit union leagues for reaction. Credit Union Association of New Mexico President/CEO Paul Stull told Albuquerque Business First that the state added 25,000 members in the past year (Aug. 5). With a total of 735,000 members, that means nearly two-thirds of the state's residents are members, he added.
 
Nebraska Credit Union League President/CEO Scott Sullivan cited the 2.9% jump in annual membership growth of his state in a Wednesday story in the Omaha World-Herald.
 
Credit unions, state leagues and members celebrated with posts on social media. Hundreds of credit union members have shared their credit union stories with their photo on americascreditunions.org and on social media to show they are part of an organization that focuses on their best financial interests. Check out a little of the social media conversation below.
 
And Learn more about the 100 million credit union membership milestone by visiting www.americascreditunions.org.

CU System briefs (08/06/2014)

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  • MADISON, Wis. (8/6/14)-- Registration is now open for the fourth annual Wisconsin Summit of Financial Literacy , set for Oct. 17 in Green Bay, Wis. The conference is geared toward supporting teachers, community outreach educators and workplace professionals who have an interest in enhancing financial and economic literacy within their communities. Topics include community projects and partnerships, workplace financial literacy, financial literacy for pre-school and pre-kindergarten parents and financial coaching. Fox Communities CU, Appleton, Wis., with $982 million in assets, is a co-sponsor ...
     
  • SAN ANTONIO (8/6/14)-- Security Service FCU, San Antonio, with $7.9 billion in assets, swept the 2014 excellence awards from the Professional Teleservices Management Association ( San Antonio Business Journal Aug. 5). It was recognized as contact center of the year and for best use of technology and best use of the voice of the customer. Vice President Tracy Queeman-Wilson also was honored as contact center leader of the year. Security Service's contact center employs 223 in San Antonio and El Paso ...
     
  • MERIDEN, Conn. (8/6/14)-- William Dokas, president/CEO of American Eagle FCU, East Hartford, Conn., announced he will be retiring from the $1.3 billion-asset credit union Jan. 2 ( Weekly Update Aug. 5). Dokas has been with the credit union for 42 years, including 24 years as president/CEO. He will be succeeded by Dean Marchessault, the current executive vice president/chief operations officer. Marchessault has been at American Eagle FCU for 14 years ...

First Commerce CU to purchase Fla. bank

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TALLAHASSEE, Fla. (8/6/14)--A Tallahassee, Fla.-based credit union has entered into an agreement to purchase a community bank, the first transaction of its kind in Florida and the sixth in the United States.

First Commerce CU, with $401 million in assets, and First National Bank of Crestview (Fla.) recently reached a deal that will transfer operation of the bank and its three branches, in addition to their would-be-members and assets, to the credit union.

"Geographically, this provides an opportunity for more diversity for us, which continues to help our institution grow," Cecilia Homison, First Commerce CEO, told News Now .

"I find it very humbling to be selected as a partner," Homison added. "As a financial cooperative with really strong ties to our community and member service, that really resonated with leadership at that institution."

The agreement will increase First Commerce's membership to about 50,000 members from 40,000 and will add $85 million in assets to the credit union's portfolio.

Four state and federal regulatory bodies must sign off on the transaction before the deal can be completed.

"We are confident that our search led us to an established, financially secure, growing credit union in our region that shares our values and will bring expanded products and services to our loyal customers," said Dale E. Rice Jr., First National president/CEO. "We know that our employees, customers and the community as a whole will be in good hands with First Commerce."

First Commerce, founded nearly 75 years ago, currently operates nine locations out of northwest Florida and southwest Georgia.

N.Y. league puts name change to vote

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ALBANY, N.Y. (8/6/14)--Managers and CEOs at member credit unions of the Credit Union Association of New York today will receive an email with voting instructions on a proposed name change for the association.

The proposed name change, which would put "New York" at the front of the name, must next be voted on and approved by the association's member credit unions before being finalized ( The Point Aug. 5).

 
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Voting will remain open for 30 days, closing Sept. 5.

"As part of an association brand refresh, the board agreed to pursue changing our name to the New York Credit Union Association," said Laurie Baker, association board chair and senior vice president/chief operating officer at The Summit FCU, Rochester, with $727 million in assets.

"By placing New York first, we directly communicate what state we represent. We believe the new name presents a stronger, more independent identity for the association and it allows us to support a national movement towards state-focused branding and advocacy initiatives," she said in a recent message to member credit unions.

Baker also shared a draft of a proposed new, modern logo, which she noted better reflects the association's identity and goals.

 

Wis. CU leaders meet with Matz, Duffy

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PEWAUKEE, Wis. (8/6/14)--National Credit Union Administration Chair Debbie Matz met with credit union leaders in central Wisconsin Tuesday to discuss issues affecting the member-owned cooperatives and how they provide financial services to their 2.4 million members in the state.
 



Matz was hosted by U.S. Rep. Sean Duffy (R-Wis.), who is vice chair of the House Financial Services subcommittee on financial institutions and consumer credit.  
 
"Credit unions welcome this tremendous opportunity to dialog because open communication helps ensure regulators fully understand the impact their decisions have on consumers, their access to credit and the cost they pay for financial services," said Brett Thompson, Wisconsin Credit Union League president/CEO.
 
"We are extremely grateful to Rep. Duffy not only for listening to credit unions' concerns about their operating environment--which has been strained by the massive changes in regulatory burden over the past several years--but also for appreciating the effects this pressure has on the wallets of Wisconsin consumers in general and those in his district in particular. His ongoing leadership and support are deeply appreciated," Thompson said.
 
Joining Matz were the NCUA's Director of Examination and Insurance Larry Fazio, NCUA's Region 1 Director Larry Blankenberger, and Wisconsin Office of Credit Unions (OCU) Director and top state credit union regulator, Kim Santos.
 
Among the topics discussed during the meeting at Northcentral Technical College were risk-based capital, cybersecurity, enterprise risk management, business lending, call reports, loan participations, credit union service organizations and the health of the economy. 
 
Most Wisconsin credit unions are state-chartered, placing the primary regulatory authority in the hands of the state OCU. Yet because NCUA insures credit union deposits up to $250,000--as the Federal Deposit Insurance Corp. does for banks--the agency conducts insurance reviews--a type of examination--of Wisconsin credit unions. The reviews are done in conjunction with the OCU to ensure safety and soundness and the health of the insurance fund that protects the U.S. credit union system.

Membership growth: Behind the CU milestone

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MADISON, Wis. (8/6/14)--On the strength of 0.3% membership growth in June, credit unions reached the milestone of 100 million memberships nationwide, as the Credit Union National Association announced its monthly credit union estimates.
 
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Credit unions attracted members at a record pace in the first half of 2014, which pushed total credit union memberships to 100.1 million at the end of June, according to Steve Rick, CUNA Mutual Group chief economist.
 
"The membership increase during the first six months was 25% faster than the similar time period one year earlier, averaging over 300,000 new memberships per month," Rick said. "In percentage terms, credit union memberships increased 1.8% year-to-date and 2.9% year-over-year."
 
Rick attributed the impressive growth to several factors: Credit unions' competitive auto loan interest rates and fees relative to banks, an increase in credit demand by the general public, lingering effects of Bank Transfer Day and relatively tight bank loan underwriting standards. 
 
"Credit union memberships are now equal to 31% of the total U.S. population," Rick said.  "And with the population growing less than 1%, the credit union membership to population ratio will continue to rise for the foreseeable future." (See related story: 100M memberships reached at CUs nationwide.)
 
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Also driving the surge in membership growth was a significant increase in new-auto loans. New-auto loan balances rose 3.3% in June, 11.1% year-to-date and 19.4% year-over-year, the fastest pace in almost 20 years.
 
"This extraordinary lending pace coincides with a nationwide annual auto sales pace of 17 million vehicles (cars and light trucks), which is above the long run sustainable rate of 16.5 million," Rick said.
 
"All loan balances are up 4.8% during the first six months of the year, twice the 2.4% pace set last year, with projections of hitting close to 10% for the year," he added.  "This is setting the stage for credit unions to post the fastest loan growth since 2005.  The surge in loan balances increased credit union loan-to-savings ratios 4 percentage points over the last year, from 68% in June 2013 to 72% today.  This will increase credit union asset yields, net interest margins and ultimately credit unions' bottom lines in 2014."
 
Credit union savings balances declined 0.6% in June compared with a 1% increase in May. Money market accounts (0.7%) and individual retirement accounts (0.8%) increased during June. On the decline were share drafts (-5%), one-year certificates (-1.2%) and regular shares (-0.1%).
 
The loan-to-savings ratio increased to 71.9% in June from 70.6% in May. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--decreased to 16.4% in June from 17.7% in May.

Don the dungarees for Sept. 10 Miracle Jeans Day

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WASHINGTON (8/6/14)--It may not be a casual Friday, but credit union employees will be sporting jeans to work en masse next month to raise money for Children's Miracle Network Hospitals.

Slated for Wednesday, Sept. 10, credit union professionals are invited to donate $5 and wear jeans as part of "Miracle Jeans Day."

Additionally, with a $25 donation employees will receive a free Miracle Jeans Day T-shirt designed for the event. In order for T-shirts to arrive in time for the event, donations must be received by the Children's Miracle Network Hospitals' national office in Salt Lake City by Aug. 22. To access the order form, use the resource link.

Stickers and special free paper icons also have been designed for the day this year so members can participate as well.

In 2013, about 55,000 credit union employees from approximately 500 credit unions participated, raising more than $300,000 for hospitals in the network.

The credit union community has been raising funds for Children's Miracle Network Hospitals under the "Credit Unions for Kids" brand since 1996. To date, the movement has donated more than $130 million for the cause.

To register your credit union, use the link.

CUNA marketing, biz dev. council reaches 1,200 members

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MADISON, Wis. (8/6/14)--By reaching a milestone of 1,200 members, the CUNA Marketing and Business Development Council is now one of three CUNA Councils that has exceeded that membership number.
 
"The growth of the CUNA Marketing and Business Development Council is a direct reflection of the membership and the value that each member brings to the council," said Amber Scott, membership committee chair and vice president of marketing, 1st MidAmerica CU, Bethalto, Ill., with $514 million in assets.
 
"Our active members share their creativity and their strategic insights, helping to drive growth in each credit union. With each new council member who joins, we are contributing to the growth of the credit union industry," she added.
 
The CUNA Marketing and Business Development Council will hold its 2015 conference March 25-28 in Las Vegas.
 
CUNA Councils, the Credit Union National Association's nationwide organization for credit union executives, has reached the 6,000-member milestone.

Monterey CU members OK conversion to mutual savings bank

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MONTEREY, Calif. (8/6/14)--With the approval of its membership, a California credit union has taken the first step in converting to a commercial savings bank.
 
The members of Monterey (Calif.) CU, with $209 million in assets, voted in favor of amending the credit union's charter to become a mutual savings bank ( Monterey County Weekly Aug. 4).
 
The credit union will next move toward becoming a commercial bank, where only shareholders have voting rights and board directors are paid for their service. This is different from the credit union structure of "one member, one vote" and board members who volunteer their time.
 
According to CEO J. Stewart Fuller, the change would give the financial institution the ability to expand business services and increase access to capital ( Monterey Herald July 24).
 
Member deposits will continue to be privately insured by American Share Insurance. Once the charter change is complete, the Federal Deposit Insurance Corp. will insure deposits.
 
The Credit Union National Association has adopted policy that it supports the right of member/owners to exercise democratic control of their credit unions, and that the credit union charter currently provides the best vehicle for serving the financial needs of consumers. The policy also notes, among other things, that CUNA encourages those credit unions considering conversions to make their decisions based solely on the best interests of their members.

Patelco fee cuts most-read July News Now story

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MADISON, Wis. (8/5/14)--An article detailing a decision by Patelco CU, Pleasanton, Calif., with $4.1 billion in assets, to erase 39 of its service fees as a move to enhance the member experience grabbed top honors in News Now's Top 10 articles for July.

The Patelco piece outdueled coverage of potentially harmful changes to Home Mortgage Disclosure Act (HMDA) reporting rules and of an announcement from National Credit Union Administration Chair Debbie Matz that three regulatory relief proposals would soon be considered by the board.

The proposals included eliminating the 5% cap on a credit union's fixed assets, modernizing the member business lending (MBL) rule and updating appraisal provisions, which were issued for public comment at the agency's July 31 board meeting.

The Top 10 articles in July were:

10. Some relief proposed for NCUA's fixed-asset management rule

ALEXANDRIA, Va. (7/31/14)--As Matz said it would earlier this month, the agency just approved a proposal for comment that would allow most federal credit unions to manage their own fixed-asset purchases without having to seek supervisory permission or waivers. However, the proposal has limitations. 

9. Regulators release HELOC end-of-draw guidance

WASHINGTON (7/2/14)--The NCUA, along with other federal financial regulatory agencies and the Conference of State Bank Supervisors, issued guidance Tuesday regarding home equity lines of credit (HELOCs).

8. CUs differ from banks in approach to subprime auto loans


MADISON, Wis. (7/28/14)--A July 21 article in The New York Times described how the subprime auto loan market has grown 130% in the five years since financial crisis, with roughly one in four new auto loans last year going to borrowers with credit scores at or below 640. Credit unions and banks approach the market quite differently.

7. Shared branching awareness campaign goes national

ST. LOUIS (7/10/14)--A shared branching video created by the Missouri Credit Union Association has developed a growing national audience.

6. House FSC markup of Reg D Study Act set for Tuesday

WASHINGTON (7/28/14)--The House Financial Services Committee will begin a markup of the Regulation D Study Act (H.R. 3240) Tuesday, a bill supported by the Credit Union National Association.

5. Fed stays course on taper, interest rates

WASHINGTON (7/30/14)--Citing "sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions," the Federal Open Market Committee announced Wednesday it will continue the pace of its quantitative easing program.

4. Senators introduce more reg relief for CUs, small banks

WASHINGTON (7/31/14)--U.S. Sens. Angus King (I-Maine), Deb Fischer (R-Neb.), Mark Warner (D-Va.), and Jon Tester (D-Mont.) unveiled new legislation intended to provide immediate regulatory relief for America's credit unions and community banks.

3. Matz alerts CUs: Some relief is coming down the pike

ALEXANDRIA, Va. (7/24/14)--The NCUA is planning to unveil three regulatory relief proposals in upcoming open board meetings. They will include plans to eliminate the 5% cap on a credit union's fixed assets, to modernize the member business lending (MBL) rule, and to update appraisal provisions, according to Matz.

2. HMDA rule changes could increase reporting burden

WASHINGTON (7/25/14)--The negative impact of the Consumer Financial Protection Bureau's proposed changes to HMDA reporting rules will far outweigh any benefit to credit unions--or their members, CUNA Associate General Counsel Jared Ihrig said.

1. Patelco: Slashing 39 fees dismantles service barriers

PLEASANTON, Calif. (7/21/14)--Thirty-nine member service fees erased. Balance transfer: gone. Card replacement: gone. Early mortgage payoff: gone. It's all part of Patelco's mission--to remove any barriers to creating a great experience of banking for its members. And it's a mission driven by Erin Mendez as she closes in on her first anniversary as Patelco's president/CEO.

CU System briefs (08/05/2014)

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  • CHESAPEAKE, Va. (8/5/14)--ABNB FCU, Chesapeake, Va., with $420 million in assets, raised more than $63,000 to benefit the Children's Hospital of the King's Daughters (CHKD) from the proceeds of its 11th annual Fishing Fest. Since Fishing Fest began 11 years ago, the credit union has raised more than $440,000 for the Children's Hospital of the King's Daughters. Nearly 120 participants gathered on the morning of June 13for a fishing excursion out of Rudee Inlet, followed by lunch provided by Mobile Pig-Nic ...
  • BATON ROUGE, La. (8/5/14)--Recent Louisiana State University graduate Chelsea Mayer won a $500 classroom makeover from Pelican State CU, Baton Rouge, La., with $234 million in assets. The credit union invited Louisiana teachers to visit Pelican's Facebook page and upload a photo of their classrooms for entry into the contest. Once entered, teachers could share the picture with their friends and family to get votes.  Mayer's Facebook friends rallied in her corner, and she won with 330 votes. The new teacher is fresh out of college, starting her teaching career at Port Allen, La. Middle School's as a sixth-grade math teacher ...

Northeast CUs take leadership role on energy loans

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WATERBURY, Vt. (8/5/14)--The cost of retrofitting a home with energy-efficient or energy-neutral equipment--such as heating systems and solar panels--can be cost prohibitive for many homeowners. However, a group of credit unions in the Northeast are taking steps to make those products a bit more attainable.

In Vermont, three credit unions have linked up with the organization SunCommon to arrange financing for those interested in installing solar panels on their homes, systems that can cost tens of thousands of dollars (The Barre-Montpelier Times Argus July 30).

Through the partnership, property owners approved for the program don't have to pay an upfront cost, but instead receive loans that they pay off over time, similar to a mortgage.  

The credit unions that have partnered with SunCommon are Vermont State Employees CU, Montpelier, Vt., with $630 million in assets; New England FCU, Williston, Vt., with $1 billion in assets; and Heritage Family FCU, Rutland, Vt., with $362 million in assets.

SunCommon recently completed its 900th installation, according to the Times Argus.

In Pittsfield, Mass., meanwhile, Greylock FCU, with $1.1 billion assets has started offering no-interest loans to pay for new heating systems and window replacements (The Berkshire Eagle July 15).

Working with local utility companies within the local Heat Loan program, the credit union can offer loans worth up to $15,000 with up to seven-year payback terms.

"We are doing our part to help people reduce their heating fuel costs while supporting community efforts to become 'greener' and save the environment," Marilyn L. Sperling, Greylock president/CEO, told The Berkshire Eagle.

Greylock has given out six such loans so far at an average of $8,000 apiece.

Unity One CU campaign: 'Don't get spanked by banks'

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FORT WORTH, Texas (8/5/14)--Banks love to hit consumers with higher interest rates and fees, and a credit union in Texas has found a way to repackage that fact into an attention-grabbing, if not provocative, marketing campaign called: "Don't get spanked by banks" (Leaguer Aug. 1).

Click to view larger image Fort Worth, Texas-based Unity One CU has grabbed the attention of local consumers with its new "Don't get spanked by banks" marketing campaign. (Cornerstone Credit Union League Photo)
Unity One CU, Fort Worth, Texas, with $218 million in assets, designed the campaign to attract consumers who are looking for a better option in a financial institution.

Gary Williams, Unity One president/CEO, told Leaguer, the online publication of the Cornerstone Credit Union League, that the purpose of the campaign is to startle the consumer into attention and then teach him or her about credit unions.

"At a strategic planning session last year, we realized that although we were doing well, we could do better," Williams told Leaguer. "We needed to do something to create greater brand recognition."

Williams added that the credit union isn't promoting any specific products with the campaign, but that it's just trying to get the Unity One name out there.

Despite the image of a hand print next to a butt as the centerpiece of the campaign, the credit union hasn't received any negative feedback, Williams said.

In addition to billboard space, Unity One also has pegged social media, word-of-mouth and "random acts of kindness" in the community as the conduits through which the credit union will deliver the campaign message.

So far, the campaign has been a hit, Williams told Leaguer, adding that the credit union has seen greater activity on its Facebook page and, more importantly, stronger growth in memberships and loans.

Houston CUs air 'Make Your Move to a CU' ad campaign

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FARMERS BRANCH, Texas (8/5/14)--The Cornerstone Credit Union League's Houston Chapter of Credit Unions Advertising Co-op will run a 30-second "Make Your Move to a Credit Union" commercial on two local TV stations: KRIV Fox 26 and KTXH My 20.
 
According to Malcolm Rene, chairman of PR and media for the chapter and chief financial officer and executive vice president of United Community CU, this campaign is not intended to promote a particular product, service or credit union, but to increase awareness and promote the benefits of credit unions.
 
"This type of awareness campaign is greatly needed," Rene told the the Cornerstone Credit Union League. "The reality is, we're not a big bank with deep pockets, so individually, we just don't have the resources to run a campaign like this, but when we come together, we can be far more effective in moving the needle toward greater awareness of credit unions."
 
The commercial is expected to reach more than 1.3 million people, and the chapter anticipates about 5.7 million impressions by the time the campaign ends in late August.
 
Credit unions, Rene said, have great stories to share.
 
"We might help a member stay in their home after a job loss, or teach a member with their very first checking account how to balance a checkbook," Rene said. "But we need to do a better job of telling our stories, and I believe our message carries further when we work together."

 

Fair Isaac survey: Millenials most likely to switch--and recommend--FIs

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SAN JOSE, Calif. (8/5/14)--Millennials are less loyal to their primary financial institutions (PFIs) than other consumers, but the younger generation is also very likely to recommend their financial institution to friends if they have a positive experience, according to a new survey from Fair Isaac Corp.
 
The survey showed that millennials are five times more likely than those over age 50 to close all accounts with their PFI, if provoked.  And high fees are a main provocation.  Millennials also are three times more likely to open a new account with another financial services provider.
 
Because of their increased openness to switching financial institutions,  those financial institutions have an opportunity to target this segment more than others for new member/customer acquisition, Fair Isaac said.
 
About 56% of surveyed millennials have recommended their financial institution in the past, and a positive service experience is a clear driver for them to recommend their credit union or bank to others.
 
Building loyalty with the millennial segment creates multiple wins, Fair Isaac said. Not only do they develop into loyal members and customers, they are also more likely to promote their financial institution's products and services.
 
About 15% of millennials use a credit union, and about 9% have a regional bank as a primary financial institution. Another 68% of millennials have a national bank for their primary provider.
 
One-third of surveyed millennials cited excessive service fees--real or perceived--as the single main reason they switched. This was closely followed by a negative experience with a financial services rep and ATM-related issues, such as too few or inconveniently located machines or exorbitant fees.
 
Negative digital experiences with both online and mobile had a much bigger negative impact on millennials than on other age groups. To build loyalty among millennials, financial institutions should use analytics to make fee waiver decisions that take into account the complete set of products member/customer has with the financial institution and the long-term attrition risk, Fair Isaac said.
 
While e-mail and direct mail are still the highest areas of preference for millennials to get marketing information, social media, television ads and word-of-mouth recommendations are often two or three times higher as preferences than other generational groups.
 
Millennials are significantly more likely to transact with their financial services providers through mobile apps than other age groups--26% prefer mobile apps, compared with 12% for GenX and 3% for Boomers. But they still prefer to use a financial institution's website over mobile apps. They also use the desktop computer at similar rates to a smartphone.
 
Because millennials use a broad set of channels and devices, financial institutions need to keep communications and member/customer experiences consistent and well-orchestrated, Fair Isaac said.
 
Mobile app usage clearly translates into loyalty for millennials, the survey said. Financial institutions should build and enhance mobile application functionality and learn how to communicate that functionality to users effectively, Fair Isaac said.
 
Millennials also want more communication with their financial institutions through texting, according to the survey. Developing more text communication with millennials is a loyalty-building opportunity, Fair Isaac said.
 

Jimmy Johns investigating possible breach

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MERRIFIELD, Va. (8/5/14)--Multiple U.S. financial institutions have reported a possible pattern of fraud that indicates nationwide sandwich chain Jimmy John's may be the latest retailer dealing with a breach involving customer credit card data, according to KrebsOnSecurity.
 
The Champaign, Ill.-based Jimmy John's told Krebs it is working with the proper authorities and investigating the situation.
 
The unauthorized card activity witnessed by various financial institutions contacted by Krebs is tied to so-called "card-present" fraud, where the fraudsters are able to create counterfeit copies of stolen credit cards.
 
If the breach is confirmed it would be added to a recent list that includes Target, Neiman Marcus, Sally Beauty Supply, Michaels and P.F. Chang's.

Looking for keys to membership diversity

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MADISON, Wis. (8/4/14)--As credit unions approach the 100 million member milestone, the diversity of credit union membership has never shined brighter. The Credit Union National Association's 2014 National Member and Nonmember survey reveals exactly how diverse that membership is.
 
Click to view larger image Click for larger view
"Our national research helps credit unions discover the demographic segments that represent their greatest opportunities and challenges," Jon Haller, CUNA's director of corporate and market research told Credit Union Magazine in a recent article.
 
Overall, credit union members are an attractive consumer market. Four of 10 have college degrees, compared with 24% of nonmembers. More than half (54%) of members are employed full time, while only 39% of nonmembers have full-time jobs. And 76% of members are homeowners, compared with 52% of nonmembers.
 
Members have a wide variety of financial needs, and those needs are constantly changing and evolving throughout their lives as they buy cars or homes, pay for college tuition, or plan for retirement.
 
For most members, their credit union is just one option for meeting their financial needs. CUNA's survey shows that 86% of members also are bank customers, while 65% of nonmembers use banks.
 
The challenge is to increase loyalty levels among your members so they're more likely to turn to your credit union the next time they need a financial product or service.

To read the full article, use the link.
 
Total credit union membership approached 97.5 million at the end of 2013, according to CUNA. That represents a 2.5% annual growth rate for 2013, compared with 2.1% for 2012. These are net growth rates, notes Haller, which take into account new members as well as those who leave.
 
"Those two years represent the highest back-to-back annual membership growth rates in more than a decade," Haller says. "The 2013 growth continues the small but steady rise we've seen each year since 2010, when the growth rate was only 0.7%."

DDoS threat landscape continues to evolve

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HAGERSTOWN, Md. (8/5/14)--Distributed denial of service (DDoS) attacks are becoming more common against credit unions and banks, and a new e-book from Ongoing Operations--"Making Sense of the DDoS Threat"--details the growing cyberthreat.
 
Credit unions are challenged to protect themselves against DDoS attacks because the attackers are now going beyond website and online banking platforms to anything that uses Internet connectivity such as Voice over Internet Protocol systems.
 
The paper notes that mitigating DDoS attacks is a game of cat and mouse with ever-changing players, levels of intensity and increasing sophistication.
 
The complex and intricate DDoS attempts require a higher level of defenders--both people (highly qualified engineers) and infrastructure (traffic routing, bandwidth and hardware).
 
DDoS attacks are more than a complete outage. Two-thirds cause a degradation in the service level of the application or an external website, resulting in fraud, reputational damage, application abandonment and frustration for both members and internal staff.
 
Additionally, the e-book lays out the guidelines from the Federal Financial Institutions Examination Council and expectations for compliance from the National Credit Union Administration. (See related story: New fraud scheme involves hacking of executives' e-mail.)

To download the e-book, use the resource link.

World Council honors global CU leaders in Australia

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GOLD COAST, Australia (8/4/14)--World credit union movement leaders Rob Nicholls and Michael Koisen received World Council of Credit Unions' Distinguished Service Award, the industry's top global honor, at the 2014 World Credit Union Conference closing ceremonies in Gold Coast, Australia, on Wednesday.
 
Recognition was also given to recipients of the World Council Young Credit Union People (WYCUP) scholarship program, Manager Certification Program, Global Women's Leadership Network scholarship and Credit Union Ambassador Award.
 
Click to view larger image Rob Nicholls, former World Council director and current New Zealand Association of Credit Unions director, received the 2014 Distinguished Service Award. (World Council Photo)
Nicholls, former deputy CEO of Credit Union of Australia; chair of Cuscal Ltd.; and director of Customer Owned Banking Association (COBA), Credit Union Foundation of Australia (CUFA) and World Council, has committed his career to the Australian, New Zealand and global credit union movements for over 30 years.
 
Michael Koisen, CEO of Teachers Savings and Loan Society in Papua New Guinea, received the 2014 Distinguished Service Award. 
 
In addition to DSA honors, World Council awarded scholarships to five participants in the World Council Young Credit Union People (WYCUP) program. The following scholarship winners earned all-expense-paid attendance to next year's World Credit Union Conference in Denver:
  • Emma Avery, Greater Building Society, Australia;
  • Oleg Vakhrushev, Nizhny Novgorod Credit Union for Education, Russia;
  • Paul Norgrove, Police CU, United Kingdom;
  • Carlos Gustavo, Sicredi, Brazil; and
  • Robin Blythe, Libro CU, Canada.
Click to view larger image Michael Koisen, CEO of Teachers Savings and Loan Society in Papua New Guinea, received the 2014 Distinguished Service Award.  (World Council  Photo)
Recipients of World Council's two-year Manager Certification Program in Papua New Guinea received recognition, including Lavinia Taraika and Jack Tewe. The audience also recognized the six 2014 Global Women's Leadership Network scholarship winners, including Nigar Agamaliyeva, Azerbaijan Credit Unions Association, Azerbaijan; Esther Cherono Keino, Belgut Rural Women SACCO, Kenya; Kristi Lozano, San Mateo CU, United States; Elenita V. San Roque, Association of Asian Confederation of Credit Unions, Thailand; Triza Tsiga Magreta, Mudi SACCO, Malawi; and Kortoe D. Woloquelli, Trust Savings Credit Union Women's Organization, Liberia.
 
World Council also presented the Credit Union Ambassador Award to Crissy Cheney in recognition of her volunteer work at the Busia Compassionate Centre in western rural Kenya. She is the wife of Bill Cheney, former president/CEO of the Credit Union National Association (CUNA) and current CEO of SchoolsFirst FCU, Santa Ana, Calif., with $10 billion in assets.

Also, conference co-hosts Customer Owned Banking Association (COBA) presented its 2014 CGU AM Institute Emerging Leader Tertiary/Vocational Education Scholarship Awards to Ben Picton, Greater Building Society; John Athanasou, Community First CU; Nikki Hutson, Railways CU; and Kirsty Maher, Hunter United CU. The 2014 Bridges COBA Emerging Leader Award went to Ryan Holman, Beyond Bank Australia.
 
Next year, World Council and the U.S. Credit Union National Association will co-host the 2015 World Credit Union Conference in conjunction with America's Credit Union Conference July 12-15, 2015, in Denver.

Minnesota CU to open university student-run branch with MCUF grant

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COLLEGEVILLE, Minn. (8/4/14)--Collegeville Community CU, St. Joseph, Minn. with $11 million in assets, has received a grant from the Minnesota Credit Union Foundation to help establish a student-run branch on the campus at St. John's University.
 
The grant was part of $7,500 in funding the MCUF announced in April for four credit unions in the state (St. Cloud Times July 30).
 
The branch, set to open at the start of the fall semester, will be largely student managed, with a student board and leadership, said Mark Douvier, Collegeville Community CEO Mark Douvier.
 
While financial oversight will take place from the credit union's main office, the branch will hire up to six students as part-time employees and include a 2014 St. John's graduate as its manager.
 
Collegeville Community CU hopes to have partnerships with several departments and organizations on campus to offer real-life experiences for students, ranging from accounting to finance and marketing.
 
Douvier said he wants the students involved in the branch to make decisions and experience the results--good and bad--of these decisions.

CU System briefs (08/04/2014)

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MIAMI LAKES, Fla. (8/4/14)-- JetStream FCU, Miami Lakes, Fla., with $163 million in assets, participated in the League of Southeastern Credit Union Broward Chapter Bowl-a-thon political action committee fundraiser. The JetStream team, aptly named "Benny and The Jets" enjoyed an evening of bowling for a good cause. "The Jets" bowled against fellow credit unions and partner companies from Miami Dade and Broward Counties in a fun night of credit union camaraderie.   "This was indeed a unique and fun way to get together with fellow credit union employees in fundraising for the league PAC,  which is  key to the credit union movement and overall success of all credit unions throughout Alabama and Florida," said JetStream Senior Vice President Guy Petroro ...
 
SAN FRANCISCO (8/4/14)-- Redwood CU, Santa Rosa, Calif., with $2.3 billion in assets, doubled its support this year as a longtime sponsor of AIDS Walk San Francisco, helping to raise more than $2.3 million for HIV and AIDS programs and services. The credit union and its staff donated a combined $5,100 in 2014 , along with volunteer time from staff, friends and families at the AIDS Walk event held July 20 in San Francisco. RCU joined the likes of Levi Strauss & Co., Walgreens, Hewlett Packard and Bloomberg in increasing their support in 2014. "Our roots in San Francisco have only grown deeper since we first came to the community in 2000," said Jacob Roberts RCU San Francisco area manager. "Our longtime support of the AIDS Walk stems from our mission and culture of 'people helping people'" ...

Recruitment resources abound, HR/TD Council white paper

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MADISON, Wis. (8/5/14)--Technology is a key resource for human resources professionals as they work to attract, hire and retain the best talent for their credit unions, according to a new white paper from the CUNA HR/TD Council.
 
However, discerning how, when and what technology to use is equally important, says "Recruiting: Techniques and Trends for Attracting the Right People to your Credit Union."
 
The white paper's four sections cover the economy, generational differences, attracting and choosing employees and how technology weaves them together.
 
An improving economy has meant a stronger pool of potential employees, according to Valerie Perez, a recruiter at United FCU, St. Joseph, Mich., with $1.68 billion in assets. 
 
"When the recession hit, it was a standstill, from teller to degreed positions. Now we're seeing more applicants and more qualified candidates," Perez said. "The unemployment extensions caused the talent pool to be almost non-existent. We would have candidates come in, but they didn't meet minimum qualifications. Currently, that's not the case."
               
HR professionals have technologies to track job postings and applicants, and test and screen candidates. Social media networks such as LinkedIn have expanded networking and word of mouth contacts, while Skype, WebEx and Google Hangouts are being added as interview tools.
 
That technology can be attractive to a younger pool of potential workers as well.  Millennials are comfortable using technology to find information quickly. A credit union that promotes a "people helping people" philosophy while be cutting edge for tech may be more attractive for younger workers.
 
"As an industry we need to be more active in getting younger employees more involved and knowing the credit union industry," said Susan Looney, senior vice president at Credit Union Resources. Technology is part of the answer, she said.
 
Think about having chat groups for employees, Looney said, or change a policy that allows texting as a method to call in sick.

CU System briefs (08/01/2014)

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  •  Des Moines, Iowa and Seattle, Wash. (8/1/14)-- The Federal Home Loan Bank of Des Moines and the Federal Home Loan Bank of Seattle announced Thursday that they have entered into an exclusivity arrangement regarding a potential merger of the two banks.  A merger would create a combined entity that would provide funding for more than 1,500 member financial institutions, including credit unions, over 13 states, as well as the U.S. territories of American Samoa and Guam and the Commonwealth of the Northern Mariana Islands. The mission of the FHLB system is to fund housing, and the economic and business development needs of its member institutions and, in turn, their members' communities. The merger would require approval from the FHLBs' regulator, the Federal Housing Finance Agency, as well as the member-owners of FHLB Des Moines and FHLB Seattle. ...

SunCorp, Alloya to merge

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WESTMINSTER, Colo. and WARRENVILLE, Ill. (8/1/14)--System United Corporate FCU (SunCorp), Westminster, Colo., has announced its intent to merge with Alloya Corporate FCU (Alloya), Warrenville, Ill.
 
SunCorp President/CEO Tom Graham said the announcement comes after "an extensive process of strategic planning and due diligence by the SunCorp board, aimed at finding the best means to deliver excellent cooperative financial services to SunCorp members. The board and management clearly saw Alloya as the best partner to help our members grow and succeed in today's competitive marketplace."
 
The merger still must be approved by the National Credit Union Administration (NCUA). Graham said he expects a member vote on the merger in February, shortly after expected regulatory approval. Prior to voting and the approval process, SunCorp plans to host multiple town hall meetings throughout the Rocky Mountain region.
 
"This merger with SunCorp clearly enhances the value that all of our members will receive," said Todd Adams Alloya president/CEO. "Combining both organizations strengthens Alloya and helps us to assure a continued, long-term cooperative value to all credit union members from coast to coast. Retaining many key staff of SunCorp also enhances our leadership and service delivery strengths, including member contact staff in all four U.S. continental time zones."
 
As part of the merger agreement, Alloya has committed to retaining SunCorp's office in Denver. It will also retain member-facing staff to further grow relationships with SunCorp's members in Colorado, Utah, Wyoming, Nebraska and California. Both boards have agreed to governance provisions for merger that include two board seats, and committee representation from former SunCorp board members.
 
The next step after the completion of due diligence would be the execution of a definitive merger agreement by both corporates and submission of an application for merger to the NCUA.

#CUNAChat takes CU awareness to Twitter

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WASHINGTON (8/1/14)--As credit unions approach the 100 million membership milestone, the Credit Union National Association  took the credit union awareness conversation to the Twittersphere Thursday afternoon.
 
CUNA hosted credit unions, volunteers and member-advocates as participants in its latest #CUNAchat on Twitter.



CUNA posted 10 questions for participants, focusing primarily on the meaning of credit unions and how they serve their communities. Chat participants responded with a barrage of tweets that provided a litany of reasons for consumers to join the credit union movement.
 
"This chat shows the power of the movement, coming together to raise awareness to consumers about credit union structure, community involvement and benefits of membership," said Amaia Kirtland, CUNA social and digital media manager.

"Reaching 100 million members is a significant milestone for all of us who love credit unions. Twitter chats help connect individuals to each other to learn new things and to develop new interests.  The cooperative nature of credit unions amplifies the reach of our message, that we are the preferred financial institution for 100 million credit union members and other American's should use a credit union for their financial services needs as well."
 
The 10 questions posed by CUNA:
  • What is a credit union?
  • Who is eligible to join a credit union?
  • What makes a credit union a different kind of a financial institution?
  • How is the credit union's structure/different from a bank's?
  • What are the benefits of being a credit union member?
  • How do credit unions impact their communities?
  • How do members control their credit unions?
  • Why are you a credit union member?
  • Why should consumers join a credit union?
  • How do you find a credit union that's right for you?

Non-traditional entrants topic of World Conference panel

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GOLD COAST, Australia (7/31/14)-- As non-traditional market entrants rapidly become many consumers' preferred financial service providers, credit unions must learn how to engage and adapt to stay in the race, panelists advised at the World Credit Union Conference in Gold Coast, Australia Wednesday. The conference is sponsored by the World Council of Credit Unions.
 
Click to view larger image Non-traditional market entrant spokespersons joined together for a lively panel discussion at the World Credit Union Conference Tuesday. Participants included, from left, Effie Zahos and Alan Shields, Australia; Alex Moven, United States; and Amy ter Haar, Canada. 
Dubbed "Catching the Disruption Wave: 'Three Big Ideas' for Serving a Radically Changing Marketplace," the panel brought together three primary market disruptors from Australia, Canada and the United States to give an outside perspective on credit unions' future.
 
Panelists included Alan Shields, RFi Intelligence co-founder and managing director, from Australia; Alex Sion, president of Moven president, from the United States, and Amy ter Haar, Flow Inc. CEO, from Canada. Effie Zahos, Money magazine editor, Australia, moderated the panel.
 
Topics focused on the keynoters' "big ideas" regarding the future of financial services as payments, finance and commerce emerge for a multi-dimensional consumer marketplace. All sides admitted that credit unions have a chance to capture and capitalize on the advantages of the disruption wave, with a need to differentiate their products and value propositions.
 
Click to view larger image "We are in a world where the app should be a credit union's product, not plastic, branches or telephone services," said Moven's Alex Sion.
"This is an existential moment for credit unions ... to redefine your basic product and core value proposition," said Sion, who asked the audience to reconsider his app-centric business as a potential partner, rather than a disruptor. "Credit unions must ask themselves what ... family and community mean in this digital era. The future of the model is to maintain the community aspect, but disrupt the physical distribution model."
 
To some panelists, the best practice model could be achieved through shared platforms among different credit unions, and potentially nontraditional market entrants.
 
"We need to get connected if we want to [financially] include everyone, everywhere. It's not us versus the banks. It's lateral and peer-to-peer," ter Haar said, noting credit unions' mission to provide nondiscriminatory financial access to all. "We are stronger together."

Mass. Senate advances investment bill

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MARLBOROUGH, Mass. (8/1/14)--Wednesday evening the Massachusetts Senate advanced a bill updating the list of permissible investments for state-charted credit unions, which would be the first substantive update to statutory investment provisions in decades, the Massachusetts Credit Union League reported.
 
The bill streamlines the petition process for the state Commissioner of Banks to add permissible investments available to state chartered credit unions ( CUScan July 1). The measure also updates criteria to add permissible investments, organizes the criteria into one location within Chapter 171, and adds certain "prudent person" investment authority.
 
The Massachusetts Credit Union Share Insurance Corporation's (MSIC) legislation (House 4112) also advanced and authorizes its ownership of real estate and creation of subsidiaries, expands its investment authority, and permits investments in credit union service organizations.
 
Both bills were engrossed in the Senate and have already been engrossed by the House of Representatives. Final enactments in both houses are the next step before the legislation is sent to the Governor for signature. The league continues its advocacy on House 4139, regional branching legislation, and other measures for the benefit of credit unions and their members. The legislature was scheduled to be in formal session Thursday in both the House and Sena te.
 
"We are pleased to see legal list and regional branching legislation continue to advance," said league President Paul Gentile. "These are part of our strategic efforts to improve the operating environment for credit unions so they can better serve members."

Study: 35% of American borrowers in collections

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WASHINGTON (7/31/14)--Thirty-five percent of adults have a debt in collections reported in their credit files, an Urban Institute study shows. But while the 35% figure is definitely cause for concern, it may be more a reflection of aftereffects from the recent recession than a long-term measure of household financial health, a Credit Union National Association economist advised.
 
"The depth and duration of the Great Recession left many out of work and/or underemployed--and that contributed to a huge surge in defaults--reflected in ongoing collections," Mike Schenk, CUNA's interim Chief Economist told News Now. "More recently, however, unemployment has declined from a cyclical high of 10% to 6.1% today and households collectively reflect substantial improvements in their financial position.  The stock market is trading near all-time highs and home prices have rebounded lifting the value of household financial assets."
 
The study, conducted with Encore Capital Group's Consumer Credit Research Institute, found 77 million Americans owed an average of $5,200 in September 2013.
 
Nevada, hit hard by the housing crisis, tops the list of states: 47% of people with a credit file have reported debt in collections. The state also has the highest average collections debt, $7,198.
 
Twelve other states (11 in the South) and the District of Columbia top 40%: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, South Carolina, Texas and West Virginia. On the low end, the Midwest's Minnesota, North Dakota, and South Dakota have about 20% of residents with reported debt in collections.
 
Debt in collections involves a nonmortgage bill--such as a credit card balance, child support obligation, medical or utility bill, parking ticket, or membership fee--that has been reported so far past due that the account has been closed and placed in collections, often with a third-party debt collection agency. This debt can remain in a person's credit file for seven years. Some consumers become aware of collections debt only when they review their credit report.
 
While it's true that most households carry debt--according to the Federal Reserve 75% of families carry some form of debt--Schenk said it's also is true that debt loads have been declining: Total debt outstanding peaked at roughly 125% of disposable income at the start of the recession, but declined to 98% of take-home-pay at the end of the first quarter 2014--a level not seen since 2002.
 
"With improving asset values and lower debt loads household net worth has increased dramatically and now is at the highest level ever--even after adjusting for inflation," Schenk told News Now. "These improvements have translated to substantial declines in loan delinquencies and loan defaults--with both banks and credit unions now reporting levels in these measures that are near pre-recession norms."

CUNA Council white paper explores big data

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MADISON, Wis. (8/1/14)--A new white paper from the CUNA Marketing & Business Development Council explores how credit unions can harness big data to tell stories, create new business, and pursue revenue and growth opportunities.
 
Big data is defined as "a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis," according to Lisa Arthur, a Forbes contributor. "Big Data: Telling Powerful Stories and Expanding Growth and Relationship Opportunities," describes how credit unions can look at their data, ask questions and make informed business decisions.

The challenge is that for most credit unions, the data already exists and is simply waiting for its story to be told. Cathy Graham, vice president of marketing, $3.9 billion asset Desert Schools FCU, Phoenix, recommends credit unions start with these steps;

 

  • Start with data you already have
  • Identify six-month goals;
  • Approach it in bite-size chunks;
  • Identify some smaller steps;
  • Constantly clean up the data;
  • Add to the data; and
  • Start with small goals, not the end goal.
As a cooperative industry, Graham adds, credit unions can partner with one another in this effort. "Many of the marketers who've worked with big data would be happy to share best practices with those who aren't as far down the path."

"Start small, and in area where you can achieve a big impact," said Anne Legg, senior vice president, business strategy and innovation at Third Degree Advertising. She recommends starting with loans, because of the opportunity for data insights to benefit the bottom line.

 

Utah credit unions give $91,800 to local schools

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SALT LAKE CITY (8/1/14)--The Utah Credit Union Association's 100% for Kids Credit Union Education Foundation awarded more than $91,800 in grants to state schools during the last school year.
 
Click to view larger image Students at Columbia Elementary School in Utah received iPads through a 100% for Kids Credit Union Education Foundation grant. (Utah Credit Union Association photo)
Nineteen districts received the funding for various projects throughout the year. 
 
The foundation grants go mostly toward supplies for the schools' core curriculum.  "We review several grant applications each quarter, looking for those that will impact the greatest number of students in the greatest possible way," said Liz White, foundation director. "As we've watched the trend lean toward technology-based resources, the foundation has awarded several grant requests for iPads and similar equipment."
 
In addition to iPads, schools across the state received funds for musical  instruments, books and science equipment.
 
"People helping people is what it's all about," said Scott Simpson, Utah Credit Union Association president/CEO. "In the true spirit of the original credit union philosophy, Utah's credit unions are giving back to the people in their communities through 100% for Kids. Every donation, large or small, goes directly to help teachers create the best classroom experience they can for their students."
 
The 100% For Kids Utah Credit Union Education Foundation was formed by the Utah Credit Union Association with a mission to improve education in Utah by enhancing and expanding classroom level resources and programs. The foundation has donated over $5 million since its inception in 2002, contributing to all of Utah's 40 school districts. All of the funds donated go directly to teachers for use in their classroom.