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CUNA Mutual Foundation grants 272000 to charities

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MADISON, Wis. (9/30/08)--The CUNA Mutual Foundation announced it will distribute more than $272,000 in grants to local organizations, including $230,000 to the United Way of Dane County (Wis.) Community Campaign. The foundation's board approved the grant renewals to Madison, Wis.-area organizations in its current funding cycle. CUNA Mutual employees' contributions will complement the total after their fall United Way giving campaign. The foundation will match any employee pledge above the $230,000 total. Other grants approved included:
* Wisconsin Center for Academically Talented Youth Children of Promise Program, $9,000; * South Madison Health and Family Center, Harambee, $10,000; * Edgewood College Courage to Teach Program, $7,500; * Waverly-Shell Rock (Iowa) Area United Way, $16,000.

Kentucky paper Local CUs banks strong

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HENDERSON, Ky. (9/30/08)--Local credit unions and banks in the Henderson, Ky., area appear to be healthier than the nation's teetering big banks, reported The Gleaner and Evansville (Ind.) Courier Press (Sept. 28). The newspapers reported on two bank rating services that evaluate the financial strength of financial institutions and noted that the area's financial institutions are doing well. Most credit unions in the area received four- or five-star ratings from Bauer and Bankrate, the ratings agencies. Commonwealth FCU, Frankfort, and Gibbs Aluminum FCU, Henderson, received five stars from both ratings services, said the article. Green River Area FCU, Owensburg, and Evansville (Ind.) Teachers FCU, which has a branch in Owensburg, both received five stars from Bauer and four from Bankrate. The Evansville Teachers FCU told the publications that a long practice of conservative investing and lending practices, plus the fact the credit union has avoided subprime lending, are reasons for its financial strength. Also mentioned as highly rated were Alcan Employees CU in Louisville and Dynamic Healthcare Employees CU, Evansville.

CUs expansion counters emigration trend

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NEW YORK (9/30/08)--The Polish community in New York may be shrinking, but Polish & Slavic FCU, Brooklyn, N.Y., is expanding. The credit union opened a new branch in Garfield, N.J., in March and an e-branch in May. It also will open a branch in Trenton, N.J., this winter and plans for a branch in Maspeth, N.J., have also been made, Marian Ponanta, Polish & Slavic vice president of marketing and public relations, told News Now. “The idea that our membership is diminishing is not true,” he said. “We’ve doubled our marketing efforts and maintained membership.” The number of Poles in New York dropped 7.8%, to 60,153 from 2000 to 2006, according to The New York Times (Sept. 21). Immigration from Poland to the U.S. has slowed since Poland joined the European Union and because of Visa restrictions. The devaluation of the U.S. dollar is also a factor. As a result, many Polish immigrants are moving back to their home country and the credit union does not have the growth strength it once had, Ponanta said. “If we didn’t double our marketing efforts, we would see negative growth,” he said. “But because we opened new branches, we’ve been able to replenish the attrition.” Polish & Slavic is going after its existing pockets of members, and is experiencing some of its best years in terms of financial results, he said. The credit union is attracting members and testing new markets with its mobile branch. It consists of a truck that has the functionality of a traditional branch through a wireless connection to the credit union’s system. The branch recently traveled to Pennsylvania and may move to Staten Island, Ponanta added. E-branching will allow the credit union to have members nationwide. Currently, Polish & Slavic’s members are in New York and New Jersey. The credit union hopes to open a branch in Chicago as a part of its strategic plan, he said. Polish & Slavic--dubbed the “engine of development” for the Greenpoint area, according to The New York Times--has, like many credit unions, been able to maintain itself during the financial crisis. “Credit unions did well,” Ponanta said. “The difference is so pronounced. While banks are going down, we’re standing. It validates credit unions.” For more information, use the links.

Wisconsin paper CUs thriving despite U.S. downturn

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MADISON, Wis. (9/30/08)--Credit unions are thriving in southern Wisconsin, despite the national economic downturn, according to The Wisconsin State Journal in an article package that took up three fourths of the front page of the paper's business section. The page included a large chart with and Bauer ratings for nearly 50 credit unions in the area, flanked by two articles--one on the state of the area's credit unions and the other on three proposed mergers involving six area credit unions. The ratings article pointed out that while some banks in the state have struggled with quarterly losses, credit unions there grew overall in assets--up 9.2% to $17.8 billion on June 30--and net income--up 17.2% to $62.1 million from last year--during the first half of 2008. "Credit unions are doing quite well," said Brett Thompson, president/CEO of the Wisconsin Credit Union League in the article. "They go their start in the Depression and came out of tough times. That's what they came from and what they're all about." The article also discussed the merger trend, with a local economics professor noting that merging with a larger credit union can help diversify membership base and attract better employees, and state regulator Suzanne Cowan, director of the state Office of Credit Unions, who said the first half of 2008 was "fairly good for credit unions." It singled out MATC CU of Madison, which hasn't had a delinquent loan in several years, and Teachers CU of Beloit, which ranks among the top 1% credit unions in the nation.

IWashington PostI posts two items on CUs

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WASHINGTON (9/30/08)--Twice in the past week, the Washington Post has featured credit unions in its advice to members--one article about the minimal effect the government's rescue plan would have on credit unions and the other on how to choose the right financial institution. In "The Crisis and Your Pocketbook" (Sept. 25), the Post noted the impact on credit unions of the government's financial rescue plan is minimal. Credit unions "don't hold many of the investments that are poisoning other financial institutions, so they have weathered the crisis fairly well," it said. Credit unions have kept about 70% of their mortgage loans on the books, instead of selling them on the secondary market. The article quoted the Credit Union National Association (CUNA) on the low member delinquencies of credit union mortgages and the fact credit unions are federally insured. In "How do I choose the right bank, savings and loan or credit union" (Sept. 28), the article focuses on the complexities of deciding a banking relationship. Among its advice: Try a credit union. "Data, including the health of credit unions' deposit insurance fund, capital levels, low balance sheet risk, competitive rates on loans and deposits, and lower fees, show credit unions to be an appropriate, safe choice among financial institutions," the article said.

North Carolina paper As banks fail CUs deserve a look

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CHARLOTTE, N.C. (9/30/08)--With the failure of many banks due to the ongoing U.S. fiscal crisis, credit unions are getting a good look from consumers as a viable alternative, according to a North Carolina newspaper. Coastal FCU, Raleigh, has seen strong growth in 2008, adding 13,600 members so far this year--an 8.5% increase, said Joe Mecca, Coastal spokesman (The News & Observer Sept. 28). The credit union also has seen a nearly 60% increase in new checking accounts and a 20% uptick in loans, Mecca told the publication. All this growth has been organic--Coastal has not constructed any new branches, he said. Consumers are beginning to become aware that credit unions are no longer just small financial institutions with few branches and ATMs, Mecca added. For example, Coastal is part of a national ATM network of credit unions with more than 50,000 machines nationwide, he said.

TowerGroup Expect more banking consolidation

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NEEDHAM, Mass. (9/30/08)--New research from TowerGroup finds that the weeks and months to come will bring more mergers and restructuring for the U.S. banking industry, even as the drive for greater regulation, transparency, and cooperation continues to be debated. At the same time, financial institutions will focus on more traditional banking activities as credit terms become tighter, capital is withheld from the market, and economic growth is further stifled, according to the research. TowerGroup is a research and advisory firm focused exclusively on the financial services industry. Jim Eckenrode, banking and payments research executive at TowerGroup, outlined conclusions about recent merger activity and the macro changes reshaping the banking landscape:
* TowerGroup said that the Washington Mutual (WaMu) deal--in which JPMorgan Chase (JPMC) won the bid to acquire the bank from Federal Deposit Insurance Corp. receivership while significantly increasing the customer base and geographic coverage of JPMC’s Retail Financial Services business--is not without concerns. The combined institution will take its place alongside Bank of America as a national consumer banking franchise. However, JPMC will now be left to deal with the troubled assets on WaMu’s books. In June, WaMu’s senior management asserted that potential mortgage loan losses could amount to as much as $19 billion. * To cover for potential losses ahead, JPMC will look to raise an additional $10 billion of capital. While JPMC’s loan loss provisions actually declined from the first to the second quarter of this year, WaMu’s provisions increased by almost 79% to $5.9 billion. Also, the new JPMC will embark upon a two-year merger conversion process that TowerGroup believes will result in a more effective technology footprint than that deployed by WaMu. * TowerGroup said that more national consolidation is to come. While most other developed banking markets are consolidated into the hands of five or so top players, the U.S. market has been more fragmented. This consolidation cycle will create another two to three national banks alongside Bank of America and the new JPMC. While many thousands of community banks, credit unions, and mid-tier institutions will continue to find success in their markets, the top-tier banking echelon will be far smaller than it is today. * TowerGroup said it believes the banking industry is on the verge of a new hierarchy. Strong banks will press their advantage with new products and services; new competitors will enter the market as the industry industrializes; and the need for greater integration across client databases, risk management capabilities, and products will cause bankers to realize they must abandon the cultural silos that have hindered their progress toward making the whole greater than the sum of its parts.
For more information, go to the TowerGroup website.

First event at Wisconsin CU house to be after elections

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MADISON, Wis. (9/30/08)--The newly established Wisconsin Credit Union House in Madison, Wis., directly across from the State Capitol, will hold its first event in early November immediately following the elections. The Wisconsin Credit Union House will function similarly to the National Credit Union House located in Washington, D.C., serving as a lobbying hub for credit unions networking with their elected representatives, said the Wisconsin Credit Union League. The facility will be open for use by credit unions to host meetings with lawmakers, and to conduct advocacy efforts and other events (The League newsletter Sept. 22). “This space belongs to Wisconsin credit unions,” said Brett Thompson, league president/CEO. “It’s their house. They’ll be able to reserve space for advocacy-related meetings, planning sessions or other meetings, beginning early next year. We encourage them to visit when they’re in Madison as well.” Credit unions attending the State Government Affairs Conference in Madison in January may have the first opportunity to see the Wisconsin Credit Union House, although ideas for an “open house” are being explored, the league said. Several leagues have followed the lead of the Credit Union House in Washington and have established facilities near state capitols.

200 CUs report Ike losses 20 of them significant

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MADISON, Wis. (9/30/08)--More than 200 credit unions in the path of Hurricane Ike have reported some type of loss due to the hurricane, with about 20 of those reporting significant damage, said CUNA Mutual Group Monday. Dollar figures on the losses won't be released until the company's senior management team and board are fully apprised, said Phil Tschudy, media relations manager at CUNA Mutual. "Reports of new losses have slowed down," he said. "As credit unions get back to business as usual, which will be difficult for some, we'll likely start seeing losses trickle in pertaining to ATMs, repossessed autos and data processing issues. Hopefully, these will be minor in nature." The hurricane made landfall early on Sept. 13 in Galveston, Texas, and affected a wide region, including Houston. "We believe we have been in contact with all credit unions impacted by this storm, Tschudy told News Now. "However, we encourage policyholders that sustained damage but have not yet spoken to us to contact our Disaster Hotline at 800-637-2676," he said, adding, "The same goes for credit unions that may have initially thought they had not sustained damage, but later discovered they did."

Wash. leagues phone call nets item on CU insurance

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FEDERAL WAY, Wash. (9/30/08)--The Washington Credit Union League’s decision to call a local newspaper Friday resulted in the paper publishing an article about the National Credit Union Share Insurance Fund (NCUSIF). David Bennett, league director of public relations, told the paper he had not seen any reporting about the National Credit Union Administration (NCUA), which administers the NCUSIF (The News Tribune Sept.27). The paper wrote a brief article that said NCUA insures the accounts of credit union members, similar to that of the Federal Deposit Insurance Corp’s insurance for banks. “Historically, bad times for banks are good times for credit unions,” Bennett told the paper. Bennett specifically mentioned Boeing Employees FCU, an $8.474 billion asset, Tukwila-based credit union, and the $234.4 million asset, Tacoma-based TAPCO CU, as having seen significant numbers of new members. TAPCO has run out of switch kits, Bennett added. Switch kits allow consumers to switch from one financial institution to another. Bennett told the paper that statewide between December and June, 62,789 new member accounts were opened. During the previous six months, credit unions opened 25,531 new accounts. “That’s an increase of 39,258,” he said.

CU System briefs (09/29/2008)

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* HARRISBURG, Pa. (9/30/08)--More than 30 credit union leaders attended a Saturday afternoon event at Pittsburgh Mills for U.S. Rep. Jason Altmire (D-Pa.. The congressman was in Washington and unable to personally attend the event due to the bailout crisis. However, he did address the crowd by telephone. Altmire gave an up-to-the-minute report on issues regarding the bailout bill. He explained his thoughts in great detail and received input from the credit union leaders. “It was quite interesting to get real time information on this bill via a conference call with the congressman,” said Janet Horn, CEO, A-K Valley FCU, Lower Burrell, and one of the co-chairs of the event (Life is a Highway Sept. 29) … * ST. LOUIS (9/30/08)--Missouri legislative candidates are meeting with credit union representatives statewide with the November elections less than six weeks away, the Missouri Credit Union Association (MCUA) said (The Missouri Difference Sept. 26). U.S. District 6 congressional candidate Kay Barnes (D) discussed federal credit union issues and concerns with a group of credit union representatives Sept. 23 in St. Joseph, Mo. Attendees provided information on credit unions and detailed three main points of the Credit Union Regulatory Improvements Act. Barnes, center, meets with, from left, Amy McLard, MCUA; Ed Foster, United Consumers CU, Independence, Mo; Brandi Catherall, United Consumers; James Spafford, Postal & Community CU, St. Joseph,; Chris McCreary, United Consumers; Peggy Nalls, MCUA; and Mike Augustine, United Consumers. (Photo provided by the Missouri Credit Union Association) … * ROCKVILLE, Md. (9/30/08)--MCT FCU, Rockville, Md., was named as one of the top 53 businesses in Maryland by The Gazette of Politics and Business. MCT was recognized for exceptional growth during the past three years and its community service programs, said the Maryland and District of Columbia Credit Union Association. The credit union also was awarded the Workplace Excellence Award for the sixth year in a row by the Alliance for Workplace Excellence of Montgomery County (Focus Newsletter Sept. 29). MCT FCU has $457.1 million in assets ... * DUBLIN, Ohio (9/30/08)--The Ohio Credit Union Foundation has changed its grantmaking cycle to ensure that grant applications receive prompt notification (eLumination Newsletter Sept. 24). Grant applications are accepted throughout the year but notifications of awards will occur every two months. Applications submitted Dec. 15 of the previous year through Feb. 28 will be notified by March 1; March 1-April 30 applications by May 31; May 1-June 30 applications by July 31; July 1-Aug.31 by Sept. 30; Sept. 1-Oct. 31 by Nov. 30; and Nov. 1-Dec. 15 by Jan. 15 ... * PITTSTON, Pa. (9/30/08)--William “Bill” McCawley, 70, a former board president of Highway CU, Pittston, Pa., died Sept. 23 at his home (The Wilkes-Barre Times Leader Sept. 24). He served as president of the credit union for 25 years. Highway CU has $16.9 million in assets ...