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Leagues continue media efforts on fed insurance

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MADISON, Wis. (10/1/08)--Leagues continued their efforts with the media to gain positive coverage educating the public and members about credit unions' federal insurance and overall safety and soundness. Among them: Indiana, Virginia and Iowa. In Indiana, the fact that credit unions are a bright spot in the financial services industry was more than apparent to viewers of Indianapolis’ CBS affiliate, WISH-TV 8, during the 6 p.m. newscast Sunday. The Indiana Credit Union League was in the middle of its three-day convention when the station responded to a news release the league had sent statewide media. The league reminded them that credit unions are a safe harbor for consumers and small business owners, especially during tumultuous times in the financial services sector. The station sent a reporter to the convention to interview league President John McKenzie and Teachers CU CEO Rick Rice. The segment opened with a reference to credit unions as the “bright spot,” which McKenzie and Rice emphasized, and with the anchor pointing out, “it is not all doom and gloom when it comes to the financial markets …. Local credit unions are actually growing during these uncertain times.” (Use link to view video) In the interview, Rice said “more people are turning toward credit unions for financial stability.” In discussing positive mortgage growth at credit unions, Rice said, "We’ve seen a lot more business come to us (Teachers CU). The first seven months of this year, we did all of what we did last year in mortgages.” “These interviews and the resulting coverage provided an opportunity to emphasize our message about consumers and business owners looking to credit unions during these difficult times for the economy and the overall financial industry," said McKenzie, who explained on-air to viewers, “Consumers and business owners recognize that credit unions represent a safe haven.” The news is broadcast to 60,000 households in Central Indiana including Indianapolis, Terre Haute, Lafayette, Bloomington, Kokomo, and Richmond. For the complete interview, use the link to the video. The Virginia Credit Union League sent two press releases that were part of an article about Citigroup's acquisition of Wachovia Bank (Daily Press Sept. 30) in Newport News, Va. Credit unions as a safe harbor was the emphasis. League President Rick Pillow said the state's credit unions are on "exceptionally strong financial footing" and the while the credit crunch has affected others, credit unions have money they're ready to lend to members. He also noted Virginia credit unions have low delinquencies. Also interviewed for the article was Jean Yokum, president of Langley FCU, Newport News, who noted the credit union has conservative guidelines and hasn't had to tighten credit as much. In a media statement about credit union federal insuranc, Iowa Credit Union League Chief Operating Officer Murray Williams noted that "credit unions are gaining welcomed recognition due to the fact that we have not contributed to this (economic) crisis. We have remained faithful to sound lending practices, thus avoiding subprime lending." Williams explained the nation's credit unions are guaranteed under the National Credit Union Share Insurance Fund (NCUSIF) at the same levels and safety as the Federal Deposit Insurance Corp. (FDIC). Nearly one million credit union member accounts in Iowa and 90 million nationwide are just as safe and sound as those at FDIC-insured institutions, he said.

CU insurance featured on IMSN MoneyI

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NEW YORK (10/1/08)--"Are credit unions insured the same way?" That's one of the 10 issues discussed in MSN MoneyCentral in a column, "Bank crisis: 10 things to know now," written Monday by Liz Pulliam Weston. In a column sparked by the turmoil of the past two weeks in the nation's economy, Pulliam Weston explains that credit unions have insurance similar to that of the Federal Deposit Insurance Corp. (FDIC). "All federally chartered and most state chartered credit unions are insured by the National Credit Union Share Insurance Fund, which is a federal fund that is backed--like the FDIC--by the full faith and credit of the U.S. government," Pulliam Weston wrote. She noted it is an arm of the National Credit Union Administration (NCUA), a federal agency, and pointed readers to NCUA's website to see whether their credit union is covered. Pulliam Weston wrote that her "e-mail inbox and the MSN Money message boards have been flooded with readers' questions about the financial crisis" (MSN Money Sept. 30). For the full article, use the link.

Mississippi league provides advice on Ikes aftermath

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FARMERS BRANCH, Texas (10/1/08)--Staff at the Texas Credit Union League (TCUL) received advice from Mississippi Credit Union League CEO Charles Elliott on dealing with the aftermath of Hurricane Ike. Mississippi credit unions went through Hurricane Katrina in 2005. Elliott understands that rebuilding and reclaiming one's life is a difficult process. Brick and mortar is easier to repair than emotional damage caused by a catastrophic event (LoneStar Leaguer Sept. 30). "Hurricane survivors have had their world turned upside down. They’ve lost their homes. The school where they once dropped their children off each morning is no longer there. Their community bears the scars of a natural disaster," noted Elliott. They "must face the reality that things will never get back to normal. Instead, they must adopt a new norm, and that doesn’t happen overnight. It’s a process." He told the Texas league it can expect credit union employees affected by Ike to experience a range of emotions--all of them healthy and important to recovery. They are:
* Hero stage. Adrenalin is high. Victims have a sincere desire to want to help each other and often assist their neighbors in cleaning debris before they clean their own. This stage typically lasts two weeks. * Honeymoon stage. A period of optimism and hope, victims feel a great sense of community and have high expectations. This stage may span three to four weeks. * Anger/hostility. About six weeks after the disaster, victims' focus shifts from the community to their individual situation. They may begin to experience symptoms of post traumatic stress syndrome and may need additional support, such as counseling. This stage can linger for months. * Acceptance/rebuilding. This stage can begin at about one year to 18 months after the disaster and last up to 20 years. It is a time of a "new normalcy," where the changed situation becomes the accepted mode.
Elliott commended the Texas league for its aid in the region's recovery efforts and encouraged continued support from the credit union community.

FoundationCUNA report features CUs community outreach

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MADISON, Wis. (10/1/08)--The National Credit Union Foundation (NCUF) and the Credit Union National Association (CUNA) have partnered to produce a supplement to Credit Union Magazine featuring stories of the credit union movement’s community outreach and social impact. The Community Outreach and Social Impact Supplement highlights the 48-page NCUF Annual Report packaged with the October issue of Credit Union Magazine. The supplement features stories from 16 leagues participating in NCUF’s signature program, REAL Solutions. The stories focus on how credit union members’ lives changed as a result of products designed to help people with low wealth and modest means. The supplement also tells how national credit union service providers and individual credit unions make a social impact in their communities. “Our foundation is committed to working with CUNA and the leagues to help the credit union movement share success stories,” said NCUF Executive Director Steve Delfin. “Socially responsible credit unions are succeeding in achieving a triple bottom line that benefits their credit unions, their members, and their communities.” Credit Union Magazine will share NCUF's stories with more than 133,000 readers in the credit union community and on Capitol Hill. “We are thanking all investors in the Community Investment Fund, NCUF corporate supporters, and all our donors in front of the largest possible audience,” Delfin explained. In other developments over the past year, NCUF:
* Expanded REAL Solutions to 28 states and built an online REAL Solutions Impact Center; * Partnered with the World Council of Credit Unions to introduce an international designation for Credit Union Development Educators; * Served as the largest donor in the credit union underwriting group for the Biz Kid$ financial education series airing weekly on 311 PBS television stations reaching 230 million viewers in 49 states; * Managed more than $4.4 million in grants to help credit unions in 23 states provide members with financial education, transaction services, savings, credit, and homeownership; * Granted nearly $3 million from the Community Investment Fund to state credit union foundations and leagues for local initiatives; * Made nearly $600,000 worth of Innovation Grants to help credit unions reach new members in innovative ways; and * Granted more than $400,000 in disaster relief to credit union employees and members with losses from tornadoes in Alabama, wildfires in California, floods in Iowa and Maine, and hurricanes in Louisiana and Texas.
The report also documents how state credit union foundations and leagues put their Community Investment Fund grants to work on the local level.

TCUF distributes 239487 in 485 grants

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FARMERS BRANCH, Texas (10/1/08)--The Texas Credit Union Foundation (TCUF) has distributed 485 grants totaling $239,487 to help those affected by Hurricane Ike. Ike made landfall in Galveston, Texas, Sept. 13. The foundation continues to receive grant applications from credit union employees (LoneStar Leaguer Sept. 30). Actual dollars received into TCUF’s disaster fund amount to $239,585.81. “We are very grateful for the level of support from our credit union family, not for us, but for the hundreds who have experienced such devastation and upheaval in their lives,” said Jill Pharr, TCUF executive director. Michelle Washington is one credit union employee who experienced devastation. While her apartment wasn’t damaged by the storm, she lost her valuables to looters, according to the Texas Credit Union League. Veronica Cromie of Galveston Island, Texas, lost her home in the storm. Cromie is homeless but continues to work at her credit union to serve members. Tara Caldwell, another credit union staffer, fled from the storm once the power went out. She ran out of gas while driving on the road. “It was a nightmare,” she told the league. Her home sustained water damage. “We’ve seen the devastation a disaster like this can have on property,” said league CEO Dick Ensweiler. “But the devastation to people is far grater. Families are pulling together, but there is a limit to everyone’s resources. We can and must do more to lend a hand throughout the region.”

CUs on the Tube Summit CU on the economy

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GREENSBORO, N.C. (10/1/08)--What happened to Washington Mutual won’t happen to credit unions, according to an official of Summit CU in Greensboro, N.C. “There is so much misinformation out there,” said Matthew Mecham, Summit chief operating officer. Mecham was interviewed by a WFMY-TV in Greensboro about the safety of credit unions amidst numerous bank failures and acquisitions, including Washington Mutual, which was sold to JPMorgan Chase and Co. Credit unions’ accounts are safe and insured by the National Credit Union Share Insurance Fund. No taxpayer has ever paid a dollar to protect the shares of a member’s account, Mecham said. Summit has $118 million in assets.

What CUs are telling the media about the economy

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MADISON, Wis. (10/1/08)--It’s okay to be concerned about the U.S.’s financial turmoil, but consumers should sit tight, according to one credit union president/CEO. The country’s economic problems are too large to simplify, and it is too early to know their impact, Navigator CU President/CEO Laurin Avara told WLOX in Pascagoula, Miss., where Navigator is based. Money at credit unions is insured by the federal government, Avara said. He also encouraged concerned families to meet with a financial planner to discuss assets (WLOX Sept. 30). Navigator does business “the old conservative way,” which has led to fewer losses. Avara said he is hopeful that the nation will pull through and that consumers can “look for opportunities in this,” he told the news outlet. Much of the media’s reporting has focused on the safety and soundness of investment companies and banks, while credit unions “continue to provide a safe haven for consumers,” wrote William Lavage, president/CEO for Service 1st FCU, Danville, Pa. in a letter to the editor of The Daily Item. He noted that credit unions were formed after the Great Depression in the 1930s to help consumers afford financial services, and reiterated that credit unions are backed by the National Credit Union Administration and the federal government. “Credit unions are the stewards of their members’ hard-earned money and take that responsibility seriously,” he said. “Investments are made conservatively, and credit unions cannot be bought and sold as commodities.” Service 1st has $129 million in assets. Navigator has $197 million in assets.

Wachovia customers use their feet head for CUs

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SANTA ANA, Calif. (10/1/08)--Some Wachovia customers are heading to credit unions for their financial needs after the bank’s deposits and other assets were sold to Citigroup Monday. Branna Banks, a Wachovia customer from Santa Anna, Calif., decided to move her money from the national bank that sustained $1.7 billion in losses this year. She opened an account Friday at Bay FCU, Capitola, Calif. (Santa Cruz Sentinel Sept. 30). In the past two weeks, the $654.2 million asset credit union has opened 1,270 new accounts totaling 14.7 million--a 40% increase, compared with a month when a promotion was not running, Tonee Picard, Bay FCU senior vice president and chief marketing officer, told News Now. “The lobbies are really full and business is good,” Picard said. “We’ve prepared a lot of user documentation and are answering questions about rates. Education is a key component for the community right now to get them through this. We’ve also conducted extensive one-on-one training with 230 employees about National Credit Union Administration insurance. We’ve equipped them with information and handouts.” The $72.2 million asset Santa Cruz (Calif.) Community CU also has seen numerous new members come through its doors in the past few weeks, with some saying they were moving their accounts from other failed financial institutions, Shelia Schat, spokeswoman for the credit union, told the newspaper. The Wachovia takeover, along with several other recent bank takeovers, have left the country with three so-called superbanks: Citigroup, Bank of America and JPMorgan Chase. One economist is not that concerned about higher costs and consumer prices caused by the “quasi-monopoly” of recent bank takeovers, including Citigroup’s absorption of Wachovia, because there are more than 8,000 banks nationwide, he told the Associated Press (Orlando Sentinel Sept. 30). Michael Pagano, finance professor at the Villanova University School of Business, also said credit unions are viable alternatives, from big ones “to small mom-and-pops with $10 million in assets.”

Suze Orman on Today Deposits with CUs are fine

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NEW YORK (10/1/08)--TV Personality and Federal Deposit Insurance Corp. (FDIC) spokesperson Suze Orman has taken note of the Credit Union National Association's (CUNA's) reminder that credit unions have federal insurance backed by the full faith and credit of the U.S. government. During a broadcast about the rescue bailout of the financial industry Monday on CNBC's Today Show, Orman twice noted that credit unions are insured by federal insurance, which is backed by the full faith and credit of the U.S. government. "If funds are insured by FDIC, if your money is in a credit union and it’s insured, if it's in Treasuries, then you're fine," Orman said. She reemphasized later that credit unions are insured by the National Credit Union Administration. Orman also featured an item on her website about credit union insurance after CUNA informed her last week that credit unions have federal insurance just as good as the FDCI. During an appearance last week on The Oprah Winfrey Show," Orman told consumers to make sure their institution was insured by the FDIC but failed to mention NCUA's insurance fund for credit unions, the National Credit Union Share Insurance Fund.

Connecticut league honors Maxwell Herring recipients

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MERIDEN, Conn. (10/1/08)--The Credit Union League of Connecticut announced the winners of the state-level Dora Maxwell Social Responsibility Recognition Award and the Louise Herring Award for Philosophy in Action. Dora Maxwell first-place winners are:
* 360 FCU, Windsor Locks, $100 to $200 million in assets, for its literacy and financial literacy program for youth and young adults; * Franklin Trust FCU, Hartford, $20 million to $50 million, for conducting “Charity Fridays” in which staffers chose a charity and asked staff and members to contribute to it; and * Hartford (Conn.) FCU, $50 million to $100 million, for organizing a “Photo with Santa” holiday celebration with the proceeds donated to the South Windsor Fuel Assistance Program. The credit union also collected food for Hartford FoodShare.
Louise Herring Award first-place winners:
* Personal Care America FCU, Trumbull, less than $50 million in assets, for its P.A.C.E. (Planning Ahead for Cash Emergencies) program; and * Pitney Bowes FCU, Stamford, $5 million to $250 million assets, for creating a series of informational sheets for its members.

CU System briefs (09/30/2008)

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* WALNUT CREEK, Calif. (10/1/08)--Pacific Service CU has introduced a mobile service allowing anyone to receive current auto, certificate of deposit, and money market rates using text messaging technology, the Walnut Creek-based credit union announced. By texting a simple message to 60529, the user will receive a reply with the credit union's current rates. In August it released a mobile service to locate the nearest surcharge-free ATM using the text messaging search technology … * TRI CITIES, Wash. (10/1/08)--Spokane Valley, Wash.-based Numerica CU is sponsoring the "Hispanic Heroes" television campaign in the area as part of Hispanic Heritage Month, Sept. 15-Oct. 15. The $784.7 million asset credit union is sponsor of two of the heroes' vignettes, which pay tribute to the first Latina astronaut to travel in space, Dr. Ellen Ochoa (shown here), and Puerto Rican-born MLB Baseball Hall of Famer, Roberto Clemente. These and other vignette tv spots are airing daily in the Tri-Cities (Kennewick, Richland and Pasco, Wash.) and Columbia Basin region on local CBS affiliate KEPR-TV and the local Univision Hispanic station, KUNW-TV. The vignettes can be seen at (Photo provided by Numerica CU) …

UT FCU breaks ground on branch amid Wall Street turmoil

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KNOXVILLE, Tenn. (10/1/08)--Knoxville-based UT FCU broke ground Monday on its fifth branch amid all the fiscal turmoil and debate over the $700 billion rescue package for the U.S. financial system. Debbie Jones, CEO of UT FCU, was expecting Tennessee U.S. Rep. John J. Duncan (R-2nd District) to speak at the groundbreaking, but Duncan was busy casting his vote on the rescue package in Washington, D.C. (Knoxville News Sentinel Sept. 30). Although Jones said she believes the $161.2 million asset credit union’s branch will be a success, owing to months of business due diligence and market research, the shaky U.S. economy may cause UT FCU to delay future growth plans, she told the newspaper. Jones reassured the credit union’s 28,000 members that its business is healthy, and conservative financial practices have kept it away from subprime mortgage loans that have harmed other lenders. However, like many other CEOs of financial institutions nationwide, Jones is concerned about tighter credit conditions for credit unions and how they will affect lending. UT FCU is still lending but has had to tighten its standards, she told the paper. A lack of lending oversight led to bad loan decisions that have had broad effects nationwide and will take time to correct, Jones added.

CUNA Mutual in strong position despite economy

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MADISON, Wis. (10/1/08)--CUNA Mutual Group is in a strong financial position, despite the troubles afflicting the U.S. economy, the company said in a statement posted on its website. “As you read the headlines and hear the financial news, it's important you know CUNA Mutual stands committed to credit unions, credit union members, and its policyholders through these challenging times,” CUNA Mutual said. “Despite the current economy, CUNA Mutual’s operating performance remains strong in 2008--results that follow a three-year period of growing revenues by 25%, doubling our profitability, and increasing benefits to customers by more than $500 million,” the company added. CUNA Mutual’s exposure to AIG, Freddie Mac, Fannie Mae, Lehman Bothers and Merrill Lynch is less than 0.1% of it general account, the company said. The compnay had $8.3 billion of cash and investments in its general account at the end of 2007. Despite economic challenges throughout the rest of 2008 and into 2009, CUNA Mutual predicts solid growth the rest of this year and a strong overall operating outlook.

Spire FCU touts National Co-op Month

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MADISON, Wis. (10/1/08)--October is National Co-Op Month, and Spire FCU, Roseville, Minn., is gearing up to celebrate. National Co-Op Month is sponsored by the National Cooperative Business Association (NCBA). Spire’s CEO, John Gisler, is on the Credit Union National Association’s Cooperative Alliances Committee. The credit union is involved with a number of marketing activities for the event. It created a poster recognizing cooperatives and cooperative products that will be placed in bubble displays at all 10 of Spire’s branches, Louis Doering, vice president of personal development, told News Now. Doering is on NCBA’s board. During the month, Spire will run full-page ads in two of Minnesota’s largest newspapers congratulating all of the cooperatives in the state. Spire also is challenging all of its branches to create displays identifying all of the cooperatives within a 10-mile radius of the credit union. Coupon books for local cooperatives are available in the branches, and Spire would like to offer member applications for camping and outdoor supply store REI at the credit union as well. The $593 million-asset Spire also bought advertising that will be aired on National Public Radio. “With the crisis in banking, it’s one heck of an opportunity [for credit unions],” Doering said. “It’s time to stand up and not be quiet about the wonderful things we do to improve our members’ financial well-being.” Long-term, the credit union also will use Enlighten, a media display with a television screen to feature individual cooperatives and tell their stories. "Co-op Month provides a great platform for credit unions to embrace their cooperative nature and differentiate themselves from conventional banks,” added Carissa Heckathorn, NCBA manager of marketing and multimedia. “A simple poster with the seven principles of cooperatives can begin the learning process for their members. Or use an ad from the Co-op Month Toolkit for their October member newsletter." For more information, use the link.

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 ...

Leagues move to inform media public of CU soundness

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MADISON, Wis. (9/29/08)--Armed with facts about credit unions' federal insurance and credit unions' performance, the state leagues moved last week en force to inform media and the public of credit unions' strength, safety and soundness. Their weapons: advertisements, press releases, media interviews, fact sheets and op-ed pieces. A statement issued by Texas Credit Union League President/CEO Dick Ensweiler Thursday was published by national and international news publications MarketWatch and EarthTimes (Sept. 25). Credit unions remain well-capitalized and fully insured, and "it's important for credit union members and the public to know why they can count on the safety and soundness of their credit union," he said. (See link for full statement). The Indiana Credit Union League has consistently sent the good news about credit unions as a safe harbor to media. "We sent out a press release in mid-July and one again today to media across the state emphasizing that credit unions are in a good position," Indiana league President John McKenzie told News Now Friday. He wrote an opinion column in a Marion, Ind., newspaper, and a column in the September/October issue of a northern Indiana magazine, Building Indiana. "Our top priority with the media is to further emphasize the distinction that credit unions are a bright spot" in today's financial market, McKenzie noted. The Detroit News published an op-ed article Friday morning written by Michigan Credit Union League President/CEO David Adams, urging readers to trust the financial system and Congress during the economic crisis. "Not all financial institutions have contributed to the crisis and not all will need government support. Michigan credit unions have not been part of the problem, but will be part of the solution," Adams said. He added that "credit unions have not taken huge risks that led to this economic meltdown" and that deposits in credit unions are insured by the federal government. (See link for full article.) The Pennsylvania Credit Union Association (PCUA) drafted a letter to the editor/op-ed article that credit unions can customize to send local media, touting credit unions' health and safety, it said in special edition of its Life is a Highway (Sept. 25). "We understand that credit unions and their members are deeply concerned about the current financial conditions in our country," said Jim McCormack, PCUA president/CEO. "But this is the credit unions' time to shine, and reassuring members that their credit union is strong and their deposits are safe, is of utmost importance." PCUA urged credit unions to "post notices on your website; send a separate mailing to members; submit an article or letter to your local newspaper; place lobby signs in prominent locations; include stuffers in statement mailings; and encourage front-line staff to share the news with members they serve." On Wednesday, Mike Wishnow, PCUA senior vice president, discussed how credit unions are weathering the financial crisis during a radio interview on Pittsburgh station WMNY. (Life is a Highway Sept. 26). Other efforts:
* Wisconsin Credit Union League worked Thursday with the Milwaukee Journal-Sentinel for an article about how Wall Street affects Main Street, which will mention credit unions' federal insurance. The league will publish an ad this week in daily newspapers in Milwaukee, Madison, La Crosse, Eau Claire, Wausau, Appleton and Green Bay. In a press release Thursday, league President/CEO Brett Thompson said, "Not only are consumers' federally insured share deposits in credit unions safe, credit unions are probably the safest depository institution in the country right now." (Use the links to the release and the ad). * The Ohio Credit Union League sent a press release Friday emphasizing that 2.6 million credit union members have insured deposits and their lending has increased despite the credit crunch. "It is important that Ohio credit union members know that they have the same protections as other financial institutions," said Paul Mercer, league president. Use the link for the full press release. * The Maryland and District of Columbia Credit Union Association (MDDCCUA), in a special FOCUS Newsletter (Sept. 25), said its Outreach Committee's fall ad campaign will focus on safety and soundness. The 30-second ads will air at top-rated radio stations in the Baltimore, Washington, D.C., and Western Maryland Oct. 6 to Nov. 23. It will place bus tail ads in Baltimore and D.C. A Google ad words and search engine plan will drive consumers to the website about credit unions. * Mid-America Credit Union Association (MACUA) reported in a Sept. 22 press release that credit unions in North Dakota and South Dakota remain safe and healthy with strong balance sheets and solid capital-to-assets ratios. “Credit unions have weathered every financial storm since the Great Depression without ever costing the American taxpayer a dime in any bailout,” said Tony Richards, MACUA president/CEO, adding that credit unions avoided the mortgage market mess.

Texas foundation Hundreds of CU employees in dire need

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FARMERS BRANCH, Texas (9/29/08)--Texas Credit Union Foundation (TCUF) continues to receive an influx of grant applications from credit union employees who experienced losses as a result of Hurricane Ike. As of late Thursday, TCUF has distributed 350 grants, totaling $168,449. To continue fulfilling these requests, TCUF desperately needs the continued support of the credit union community, said the foundation (LoneStar Leaguer Sept. 26). “It is hard to imagine some of the stories we have received," said TCUF Executive Director Jill Pharr, who noted that "there are hundreds and hundreds of credit union employees who are in dire need of assistance.” “As more and more of these dedicated credit union employees catch their breath and realize the extent of personal loss they have suffered, they are turning to us for help," she said. "We have had enormous response from the credit union community in Texas and across the country, but I don’t think any of us realized the true extent of people’s losses until the applications began pouring in, along with calls from credit union CEOs," Pharr added. “Just as quickly as the grants go out, we hear stories and receive letters from the recipients who are overwhelmed at the expression of ‘People Helping People,’ through this disaster aid,” said Pharr. Requests dramatically increased last week. TCUF had to hold some grant applications until the pledged funds are received. "That delays our ability to meet these requests on a timely basis,” said Pharr. “We know the credit union family will respond to these needs.” TCUF expected to receive funds Friday collected from the National Credit Union Foundation through its CUAid program, she said Thursday. The funds include a $25,000 grant from NCUF. TCUF has posted a list of donors that is updated daily on its website, Instructions for how to make a donation are included in the resource link.

Counterfeit checks issued in sweepskates scam

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DECATUR, Ala. (9/29/08)--Counterfeit checks bearing the name of Family Security CU have been received by recipients of a "sweepstakes" letter in Maryland and Virginia. According to the Decatur, Ala.-based credit union, the bogus checks for $3,895.85 arrived with a memo from "First Capital Alliance Ltd." in New Brunswick, Canada, bearing a claim number: FA/8/S/3/A. The memo tells recipients they won a sweepstakes "sponsored by a group of multi-national companies in North America." It mentions a random drawing from "Federal Computer Data Bank." The "winners" are told they won $180,000, that the amount of the check will be deducted from the winnings, and that they will use $2,800 of the check to pay for surcharges and taxes on the winnings. It also notes that no personal information, such as the winners' bank account, credit card number or Social Security number, is required. The victims are required to call a number to "activate" and clarify the sweepstakes offer. The numbers are New Brunswick numbers. According to Gina Turney, director of compliance and security at the credit union, attempts to call the numbers did not go through because there was no room to record new messages.

Indiana governor supports expanded CUs MBL

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INDIANAPOLIS (9/29/08)--Indiana Gov. Mitch Daniels opened the Indiana Credit Union League's annual convention Friday morning and expressed support for key credit union initiatives in the state, according to League President John McKenzie. Daniels indicated prior to the meeting that he was in agreement with two key areas of emphasis that the league has expressed in a recent letter to the state's congressional leaders, which asked them to be mindful of any impact congressional action could have on credit unions. The areas of agreement are:
* An expansion of the credit union presence in the marketplace as a part of the solution for the for-profit sectors problems, even though credit unions did not create those problems. * An expanded presence in business lending to provide local lenders as a counterbalance to the for-profit sector.
Daniels not only has clout in the state, but also has national influence, as a former chief of staff to Sen. Richard Lugar, as a senior advisor to former President Ronald Reagan, and as a former director of the Office of Management and Budget for President George W. Bush, McKenzie told News Now. "He indicated that this is a great time for credit unions to tout what they stand for and promote the right way to do business," McKenzie said. The governor was in agreement with a letter the league sent to Indiana's members of Congress on Sept. 22. Credit unions have been pointed out by congressional leaders as "being a bright spot in today's financial services marketplace," the letter said. "Because not-for-profit credit unions continue to provide an important counterbalance to the for-profit sector of the marketplace, we believe that the current environment demonstrates that an expanded credit union presence is good for the financial system, good for consumers, and good for business owners needing access to credit from local lenders," McKenzie said. The governor also expressed support for credit unions during a question and answer session after his speech. Daniels is a long-time credit union member. He is a member of Eli Lilly FCU in Indianapolis.

CUs write letters to editors about CUs strength

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MADISON, Wis. (9/29/08)--Credit unions nationwide are sending letters to their local media touting credit unions’ strength and security. The letters were triggered by media reports stating that consumers should place their deposits in Federal Deposit Insurance Corp. (FDIC)--insured accounts. Credit unions’ funds are guaranteed under the National Credit Union Share Insurance Fund (NCUSIF), to the same levels and safety as FDIC-insured accounts, according to a letter sent to all print and broadcast media in the Dayton, Ohio, written by Douglas Fecher, president/CEO, Wright-Patt CU, Fairborn. The North Carolina Credit Union League noted that Allegacy FCU, Winston-Salem, N.C., was spotlighted by a local television news station concerning the safety and soundness of the credit union (use the link to watch the video). No penny has ever been lost in an account with the NCUSIF, Allegacy CEO Ike Keener said in the video. AmeriChoice CU, Mechanicsburg, Pa., sent a letter to the editors of local media emphasizing the credit union’s safety and soundness. “Our asset base is solid and growing while our loan portfolio remains healthy with minimal delinquency. We were awarded one of the highest grades by the National Credit Union Administration (NCUA) during our last financial examination,” the credit union said. Tobyhanna Army Depot FCU, Scranton, Pa., also sent in a press release to editors. “All Pennsylvania credit unions are backed by full faith and credit of the U.S. government and the NCUA,” wrote Jim Kanaley, Tobyhanna CEO. “Credit unions are the stewards of their members’ hard-earned money and take that responsibility seriously,” he wrote. “Investments are made conservatively and credit unions cannot be bought and sold as commodities.” Many credit unions also posted messages to their members on their websites. UW CU, Madison, Wis., posted on its website a letter to its members, assuring them of safety and soundness. It also included the credit union’s August financials. A member noted that the credit union prominently displayed the letter and the chart of the credit union’s financials was “compelling.”

Four auto dealer managers arrested for inflating prices

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ORANGE, Calif. (9/29/08)--Four former managers at Orange, Calif.-based Douglas Nissan were arrested Wednesday on suspicion of defrauding customers and financial institutions--including two California credit unions--in a scheme to inflate used-car prices, according to prosecutors. NuVision FCU, an $847.4 million asset, Huntington Beach-based credit union, and Wescom CU, a $3.692 billion asset Pasadena-based credit union, were among the financial institutions defrauded in the scheme, prosecutors said (The Orange County Register Sept. 25). The scheme consisted of manipulating used vehicles’ Kelley Blue Book values--a commonly used reference for determining used automobiles’ selling prices--through bogus reports that the vehicles had upgrades such as navigation systems, DVD players, premium wheels and leather interiors, prosecutors said. Once they found out how much a customer could afford in monthly payments for a vehicle, the four defendants arranged loans that roughly matched the payment amount, prosecutors said. When Douglas Nissan reported fake vehicle upgrades that inflated the loan amount and car price, the lender and the customer were defrauded, prosecutors said. The four former managers arrested Wednesday are: Frank Ignacio Urbano, a former part-owner and general manager of the dealership; and former sales managers Luz Belem Corral of Costa Mesa, Kevin Allen Derosier of Anaheim, and Marwan Abdellatif of Lakewood.

Directions offered on Mica federal insurance video

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WASHINGTON (9/29/08)--Credit unions can embed on their own websites a video of Credit Union National Association (CUNA) President/CEO Dan Mica explaining federal savings insurance at credit unions, as well as the strength and soundness of credit unions, by following a few, simple instructions. The video, featuring Mica, is aimed at explaining to the public--in simple, understandable terms--the fact that credit unions have federal savings insurance, providing coverage of at least $100,000--and are backed by the full faith and credit of the U.S. government. Use the resource link below to access the complete instructions for embedding the video. In addition or the alternative, credit unions and leagues also may link to the “America’s Credit Unions” site at for accessing the video. The site also includes additional information about the safety, soundness and strength of credit unions.

Galveston Government ECU We are still here for members

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GALVESTON, Texas (9/29/08)--Mandatory evacuation orders in the face of Hurricane Ike closed the doors on Galveston (Texas) Government Employees CU’s normal Broadway Street location, but it did not stop the credit union from doing business. Deploying a contingency plan, the $9.6 million-asset credit union moved its operations to a mobile branch unit in neighboring League City a few days after the hurricane made landfall on Sept. 13 (LoneStar Leaguer Sept. 26). “Operating in a coastal community, we are acutely aware of how vulnerable we are to Mother Nature,” Rachel Jones, Galveston Government Employees president/CEO, told the Texas Credit Union League. “We also understand that our members count on us to be there for them, particularly in times of distress. “We want to assure our members that we are still here, and that we are still a safe and sound institution,” she added. With the help of another area credit union willing to share its phone lines, the credit union quickly restored phone service after its phone lines went down. It also resumed mail service quickly by opening a post office box in nearby Dickinson. The credit union would not have been able to provide service to members if it had not been for the Galveston County Sheriffs Department providing security, Jones said. To help members who sustained financial losses due to Hurricane Ike, the credit union is offering skip-a-pay, which allows members to forgo making a payment on an outstanding loan for one month. Its Hurricane Ike loan allows members to borrow up to $1,000 with no payments for 90 days and a minimum $50 payment afterwards for up to 24 months. “Throughout this whole ordeal, we kept a close pulse on our membership,” Jones said. “They are depending on us to help them get through this.” “Many of the staff at Galveston Government Employees CU, as well as its volunteer board of directors, are among the thousands of residents in the area who have been displaced from their homes,” Dick Ensweiler, league president/CEO said. “But instead of focusing on their own personal hardships, their attention is on their members.”

Pennsylvania Supreme Court sends case back to lower court

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HARRISBURG, Pa. (9/29/08)--The Pennsylvania Supreme Court issued a procedural ruling Thursday sending court cases involving community charters back to the lower Commonwealth Court. The cases involve five-county community charters granted to Freedom CU, Warminster, and TruMark Financial CU, Trevose (Life is A Highway Sept. 26). The Commonwealth Court will decide whether the Pennsylvania Department of Banking properly approved the five-county community charters applied for by the credit unions. The ruling has no impact on the credit unions’ community charters or members, the Pennsylvania Credit Union Association (PCUA) said. No time frame has been set for the commonwealth court’s review, PCUA said. The litigation involves the Pennsylvania Bankers Association, Pennsylvania Department of Banking, and the two credit unions. The case began in 2004 when bankers challenged the department of banking's decision to approve community charters. It then was considered by the Commonwealth Court at the appellate level, and last week before the Supreme Court. At issue is the Pennsylvania's Commonwealth Court's 2006 ruling, by 7-0 tally, in favor of the state department of banking secretary's decision to allow community charters for the two credit unions. The court dismissed the bankers' challenges, and bankers filed an appeal on April 28, 2006 (News Now April 12).

Morale high among employees in hurricane region

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FARMERS BRANCH, Texas (9/29/08)--Despite seeing widespread devastation caused by Hurricane Ike on his tour of Southeast Texas Thursday, Dick Ensweiler, CEO of the Texas Credit Union League, discovered that morale was high among credit union employees affected by Ike. Roads filled with debris, collapsed roofs sitting on building foundations, and personal belongings scattered on lawns were part of the destruction Ensweiler saw (LoneStar Leaguer Sept. 26). Ensweiler visited branches of several credit unions that sustained severe destruction from Hurricane Ike. They included:
* Houston Police FCU; * Firestone Community FCU, Orange; * Five Point FCU, Nederland; and * DuPont Goodrich FCU, Nederland.
Gulf CU, Groves, was lucky enough to avoid damage from Hurricane Ike, but some employees were not as fortunate. Several, such as compliance officer Stephine Adams, lost their homes. Roiling waters swept all her possessions out of her home and made it uninhabitable. The silver lining is that five horses she left behind are OK. She and her family waded through knee-deep water to lead them to safety. Adams said she is taking things “one day at a time.” This also was the sentiment of Evan Gonzalez, a teller with Five Point FCU, and Scott Lawson of Firestone Community FCU, who live in Bridge City and lost their homes. The community of 3,500 homes was so devastated by Hurricane Ike that fewer than 20 homes are inhabitable. Shanna Hubert, an employee of Five Points CU, also lost her home. Her branch is in ruin and she now works in a mobile unit in a parking lot near a busy street. “It’s definitely hard, but you can’t let it get you down,” she told the league. “You’ve got to keep going--our members are depending on us.” Frontline staff of Houston Police FCU are working in mobile units set up in the parking lot of the credit union’s main office, which became submerged in water when its roof was torn off by high winds. Mildew fills the air inside the damaged building. Employee morale was high despite having to work in closed quarters, Ensweiler found. Executive assistant Mitzy Plumb is living in a recreational vehicle parked in her driveway because her house was smashed by fallen mature trees. She said her daily duties at the credit union bring her joy. “We have very special people serving in this movement,” Ensweiler said. “Despite their personal tragedies, they go to work every day with a sincere desire to serve their members.” Ensweiler planned to continue his tour last Friday, visiting Coastal Community CU, Galveston; JSC FCU’s Galveston Branch; Amoco FCU, Texas City; and Beacon FCU, LaPorte.

Two to be inducted into N.Y. hall of fame

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ALBANY, N.Y. (9/29/08)--Two credit union individuals will be inducted into the Credit Union Association of New York’s Hall of Fame Oct. 7 at the association’s annual convention. The inductees are Robert Barber and Alfred Mariani. Barber joined Albany Firemen’s FCU in 1962. He served as the chairman of the credit committee until 1982. He also was one of two loan officers until 2003, when he was appointed chairman of the credit union’s supervisory committee. Mariani entered the credit union movement in the late 1940s. He served as treasurer of Oneida FCU, and Bendix FCU. In 1952, he was hired as a field representative for the Syracuse chapter--of whatwas then the New York State Credit Union League. He organized more than 100 credit unions for the next 14 years. He became manager/CEO of Syracuse University FCU and served as a New York league volunteer, and Syracuse chapter president, director-at-large, Syracus director and first vice president. Mariani also was a director of the Credit Union National Association, founding member of Members United corporate FCU and a member of CUNA Mutual’s Policyowner’s Board. He was the Credit Union Association of New York’s first two-term president (chairman).

CU System briefs (09/26/2008)

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* FAIRBORN, Ohio (9/29/08)--Wright-Patt CU's eight-month Savings Race begins Wednesday. The race involves five families, chosen from more than 80 member applicants. They who will work with credit union coaching teams to improve their spending and savings habits, and work toward a family-specific goal to increase savings and net worth, and reduce debt. The family closest to its goal will be awarded $10,000 upon completion of the race in May 2009. The four runner-up families will receive $2,000 each. The race was designed to benefit not only the participants, but the entire Miami Valley, said Doug Fecher, president/CEO. The event will get people to talk about their finances, he said. Community members can follow the families' progress and initiate their own savings plan by viewing blogs, Web updates and local news vignettes, and by attending free credit union financial planning courses along side the race participants … * SPRINGFIELD, Ohio (9/29/08)--The husband of Carol Aranjo--former CEO of the defunct D. Edward Wells CU who was convicted of embezzling $1.5 million from the credit union--was sentenced Thursday to one year and one day in prison for his part in the embezzlements (Associated Press Newswires Sept 25). His sentence came a few hours after Aranjo was sentenced to 4.5 years in prison and ordered to pay restitution of $1.4 million (News Now Sept. 25). Smith was convicted on 10 charges and acquitted on others. The credit union was closed by federal regulators in 2003 … * DULUTH, Ga. (9/29/08)--The annual golf tournament to benefit the Georgia Credit Union Foundation netted $40,000 for Brenden Welch, vice president and general manager of Jones Lang LaSalle Americas Inc., a real estate firm, when he sank a hole in one on his first try. Welch was teamed with Jeanne Kucey, president of Retail Employees CU and vice chair of the foundation. Welch had the choice of a new Lexus GS3000, provided by Enterprise Car Sales, or the cash. He opted for the cash. From left are Welch, holding son Luke, age 1, and wife Sheri, holding son Nicholas, age 5. Welch sank the drive on Luke's one-year birthday, using a golf ball onto which he had written "Nicholas' dad." (Photo provided by the Georgia Credit Union Affiliates) …

New York league Financial chaos is an opportunity

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ALBANY, N.Y. (9/26/08)--Credit unions can turn the economic chaos of today into a golden opportunity to fulfill their mission, says the Credit Union Association of New York. President/CEO William J. Mellin's message to the New York's credit unions in the league's weekly newsletter notes that credit unions can and should (The Point Sept. 22-26). Consumers worried about the economy have "one place to go, because one type of financial institution remains stable, sound, and welcoming to people from all walks of life," Mellin wrote. "We have been here before. Back in the 1930s, with banks failing at an alarming rate and millions struggling to make ends meet, credit unions enjoyed a great upsurge in membership," Mellin said. "People instinctively realized the value of a cooperative form of finance, owned by its members, where people were more important than money." Today the relevance of credit unions is highly visible once again, with major national media noting credit unions' stability amid economic turmoil. "The stage is set for another upsurge. Whether it happens, however, is up to us," Mellin wrote. "Potential credit unions can only join a credit union if they've heard of credit unions--if they understand what a credit union is, how it operates, what sets it apart," he wrote. "Because you are part of their communities, you are the face of credit unions to them. You have the best opportunity to communicate the credit union difference with the most impact," he added.

Alaska FIs fielding more deposit queries

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ANCHORAGE (9/26/08)--Credit unions and other financial institutions in the Kenai Peninsula of Alaska have been fielding queries from consumers about their deposit insurance coverage. They are "fielding more questions than usual these days" from consumers worried about how the economy will affect their savings accounts, said Peninsula Clarion (Sept. 24). The article, which emphasized that most banks and credit unions have federal insurance, interviewed two banks and a credit union. Alaska USA FCU Chief Financial Officer Norm West told the publication that the credit union has been getting calls from worried members who want more information about the current situation. Several have inquired about differences between credit unions and banks. The callers generally say they are happy or they have more money to move from other institutions, West said. Tellers may be answering more questions at the counter, he said. Use the resource link for the full article.

Aranjo sentenced to 4.5 years in CDCU embezzlement

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SPRINGFIELD, Mass. (9/26/08)--A former CEO convicted of embezzling $1.5 million from a now-defunct community development credit union in Springfield, Mass., was sentenced Thursday to 4.5 years in prison and ordered to make restitution totaling $1.4 million. Carol Aranjo, former CEO of D. Edward Wells CU, had been convicted of 44 charges, including embezzlement, conspiracy to embezzle, bank fraud, and filing false tax returns ( and The Republican Newsroom Sept. 25). Her husband, Alphonso Smith, who was convicted of 10 charges, was to be sentenced later Thursday. U.S. District Judge Michael A. Ponsor noted that Smith was responsible for between $200,000 and $400,000 in company losses. The embezzlements occurred through bogus transfers, issuance of "free" cashier's checks, and running accounts deeply in the red. The credit union was closed by federal regulators in 2003. At the time it had losses totaling about $3 million News Now Feb 8). Aranjo, who was a well-known advocate of community development credit unions, was removed as chair of the National Federation of Community Development Credit Unions in 1999 and she departed from the federation in 2000.

Donations for Ike are mounting

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WASHINGTON (9/26/08)--Several credit union foundations have reported that donations for Hurricane Ike disaster relief for credit union employees are mounting. In less than two weeks since Hurricane Ike made landfall, the Texas Credit Union Foundation (TCUF) has raised over $168,000, while the National Credit Union Foundation (NCUF) has received over $100,000 in donations through and additional pledges, Steve Bosack, NCUF deputy director, told New Now. The largest pledge is from the Mississippi Credit Union System (MCUS), which has pledged to wire $33,000 to NCUF. MCUS President Charles Elliott requested that NCUF designate $28,000 to help credit union people in Texas and $5,000 to help credit union people in Louisiana.
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“TCUF emphasized that credit union employees have tremendous ongoing needs,” Bosack said. “TCUF has been making hundreds of $500 emergency grants almost as quickly as applications are coming in. “However, now that more residents are finally being allowed to ‘look and leave’ their properties and see the damage for themselves, it's clear that many more credit union employees have lost everything they own,” he added. “These employees will have much greater needs because insurance and the Federal Emergency Management Agency cannot make them whole.” To help respond to these urgent needs, NCUF Executive Director Steve Delfin is exercising his maximum discretionary grant-making authority: NCUF will grant $25,000 in disaster relief to the Texas Credit Union Foundation, in addition to the funds raised for Texas through the national CUAid campaign, NCUF said. In separate disaster relief, the Iowa Credit Union Foundation raised about $552,000 as of Thursday for victims of June flooding throughout Iowa, Emily Oliver, director of public affairs and marketing for the Iowa Credit Union League, told News Now. Midwest storms and subsequent flooding impacted about 30 Iowa credit unions and some of the biggest metropolitan areas in the state (News Now June 13).

Two CUs report telephone scams

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LONGMONT, Colo., and CHICOPEE, Mass. (9/26/08)--Two credit unions reported scams this week involving telephone calls, fraudulent e-mails and text messages to members and non-members. St. Vrain Valley CU, Longmont, Colo., said members and non-members of the credit union reported fraudulent telephone calls from scammers attempting to obtain personal financial information. The area codes of 303, 720 and 970 are being targeted, the credit said on its website. The calls claim to be from St. Vrain, saying recipients’ cards have been suspended and inviting them to reactivate after they give out personal information. Polish National CU, Chicopee, Mass., also reported that fraudulent e-mails, text messages and telephone calls were sent to credit union members and non-members. The messages said that their accounts had been suspended due to a billing failure. If the recipients responded to the e-mail, they were linked to a fake online banking site or given a phone number to call. They were asked to submit their credit card number and personal identification number to reactivate the account, the credit union said on its website.

Ohio CUs recovering from hurricane remnants

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DUBLIN, Ohio (9/26/08)--More than a dozen credit unions in Ohio were closed at some or all of their branch locations last week, after the remnants of Hurricane Ike battered Southwest, Central and Northeast sections of the state. Some credit unions were without power for a few days, others for the entire week, said the Ohio Credit Union League (OCUL)(eLumination Newsletter Sept. 24). The league said it investigated the outages and provided information to the state and federal regulators. This week, most of the credit unions affected were back to normal business. Ohio's credit unions can apply for disaster relief grants from the Ohio Credit Union Foundation in such disasters, the league said. Shared branching played a key role in serving the closed credit unions' members. Marty Auxter, OCUL Services Corp. business consultant, noted that shared branching is a "vital disaster recovery tool, especially in situations like we just experienced, where power was available in one neighborhood, but not another." Currently, 76 of Ohio's credit unions participate in shared branching.

Colorado association announces award recipients

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DENVER (9/26/08)--Five Colorado credit unions and one credit union chapter received first-place honors from the Credit Union Association of Colorado (CUAC) in its 2008 statewide Dora Maxwell, Louise Herring and Desjardins awards contests. The program is sponsored by CUAC and the Credit Union Association of Wyoming, and is nationally sponsored by the Credit Union National Association to honor credit unions’ community projects and activities. Dora Maxwell Social Responsibility Recognition Awards first-place winners:
* Pikes Peak CU, Colorado Springs, $20 million to $50 million in assets; * Space Age FCU, Aurora, $50 million to $100 million; * Coors CU, Golden, $100 million to $200 million; * Denver Community CU, $200 million to $500 million; and * Flatirons Chapter of Credit Unions, chapter entry.
Louise Herring Award for Philosophy in Action first-place winner was Denver Community CU, $50 million to $250 million in assets. Desjardins Youth Financial Education Award first-place winners:
* Arapahoe CU, Littleton, $35 million to $75 million in assets; and * Denver Community CU, $75 million to $250 million.
First-place winning entries advance to the national competition where they will compete with other projects from credits unions nationwide in the same asset-size category.

California budget impasse impacts CUs costs

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SACRAMENTO, Calif. (9/26/08)--The Golden 1 CU made loans this summer to 1,095 California state workers to help them through the state’s 85-day budget impasse, and its assistance cost the credit union $52,000 in opportunity costs. The $52,000 represents what the credit union could have earned investing the money, rather than loaning it at 0% interest to the state workers who did not receive paychecks during the budget stalemate, Teresa Halleck, The Golden 1 president/CEO, told News Now. Several loans were made to some of the workers, Halleck added. “We just passed the 75th anniversary of The Golden 1 CU,” Halleck said. “From a membership standpoint, there has been a tremendous loyalty to state workers. We’ll take care of state workers. I don’t know why they would bank with anyone but The Golden 1.” California Gov. Arnold Schwarzenegger signed the longest overdue budget in state history Tuesday (The Mercury News Sept. 23). The Golden 1 is based in Sacramento, Calif., and has $6.955 billion in assets.

Iowa league honors three leaders at convention

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DUBUQUE, Iowa (9/26/08)--More than 500 credit union representatives and vendors attended the Iowa Credit Union Annual Convention held Sept. 17-19 in Dubuque. Three credit union leaders in the state were honored. The awards ceremony, held during the Iowa Credit Union League’s Annual Meeting, recognized Trudy Koppen from Frontier Community and Postal Employees CUs, Fort Dodge, as the Professional Cooperative Spirit Award winner; and Denise Dolan of Dupaco Community CU, Dubuque, as the Volunteer Cooperative Spirit Award winner. DeLon R. Gobeli from Veridian CU, Waterloo, was presented with the Heritage Award for lifetime achievement. Opening keynote presenter Peter Duffy offered his perspective on the challenges and responses of the credit union business model. Education sessions included topics on compliance updates, director responsibilities, disaster recovery plans, and the current economy and its impact on credit unions. The convention also included a credit union town hall meeting, Iowa Credit Union Foundation annual meeting, Iowa Credit Union League Transfer System annual meeting, new attendee orientation and a directors’ dinner. The 2009 convention will be held Sept. 16-18 in Des Moines.

Letters to editor question CU bank merger in Maine

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AUGUSTA, Maine (9/26/08)--Two letters to the editor in the Kennebec Journal Wednesday question the benefits that Kennebec Valley FCU (KV FCU) would gain if it converted to a savings bank and merged with Kennebec Bank. “I’m trying to comprehend why members of KV FCU would want to dissolve their credit union and merge with Kennebec Bank,” wrote Terrence C. Casey to the newspaper. “People usually join credit unions because of the benefits and services offered.” Tom Hilyard, East Winthrop, Maine, said the Journal’s article about the proposed merger “made it obvious that this was an acquisition rather than a merger and that the new entity will be operated as a bank and not as a credit union.” He added that members should “grab their shares and find a real credit union where they can again be an owner and in better control of their financial affairs.” Augusta, Maine-based KV FCU and Kennebec Bank announced earlier this month that they were discussing a conversion and merger. The credit union’s board is scheduled to vote Oct. 14 on a proposal to convert to a federal mutual savings bank. After the conversion, the credit union would merge with the bank (News Now Sept. 10). The credit union said the conversion and merger would expand its ability to meet the current and future needs of members. “It makes sense to consider combining our efforts with a local institution that has similar values,” said Beverly Beaucage, president/CEO of KV FCU (News Now Sept. 10). KV FCU has $51 million in assets. To read the letters, use the links.

Investors sue CU over brokerage advice

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HARRISBURG, Pa. (9/25/08)--Five members of a Harrisburg, Pa.-based credit union have filed a lawsuit in Dauphin County Court, claiming they lost money because of financial advice from a brokerage service offered by the credit union. Belco Community CU, a $268.6 million asset credit union based in Harrisburg, was named in the suit by five retired Verizon workers. The suit claims they lost part of their retirement savings by following advice from a financial planner with CUNA Brokerage Services Inc., which provides member financial services for the credit union. The retirees have also filed a complaint at the Financial Industry Regulatory Authority. “We take any consumer complaint seriously," said Rick Ullman, senior manager, media relations, at CUNA Mutual Group. "The cases filed against the credit union involve members whose investments were affected by the 2000-2003 market downturn, as many investors were, and they are looking for someone to hold responsible for their losses," Ullman told News Now. "We believe the suits are without merit, but respect the members’ right to pursue their claims,” he said. “This is a highly regulated industry and the business practices used by CUNA Mutual and Belco are sound and appropriate,” he concluded. Lonny Maurer, Belco president/CEO, could not comment on the lawsuit specifics. He noted that a local newspaper accurately reported his comments about a bear market. "We can't predict when bear markets occur. Bear markets do have a significant impact on what has happened in the market and their specific investments," he told the Patriot-News (Sept. 24).

Ike destroyed its branches but not its spirit

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FARMERS BRANCH, Texas (9/25/08)--Janna Achord, the new CEO of Firestone Community FCU, has her job cut out for her. The credit union, located in Bridge City, Texas, was among the 188 credit unions in Southeast Texas that crossed paths with Mother Nature on Sept. 13. Hurricane Ike left two of its three branches non-operational. Six of the credit union's 20 employees have lost everything. Many other employees face costly repairs to their personal property. Achord took over the helm of the $33 million asset credit union three months ago. Though they've been a team for just a short time, Achold says she and Firestone Community's 20 employees, as well as its board of directors, have pulled together to rise above the lingering aftereffects of Ike. "Many of us have been through this before," she said. "We persevered over Hurricane Rita, and we'll do the same with Hurricane Ike. I couldn't be more proud of how our staff has handled this situation. They've put aside their own personal hardships to be there for our members." For example: An employee of the Orange County Sheriff's department was unable to retrieve any personal items from his home before the hurricane hit. His home was demolished. He lost everything. When the credit union's employees learned of his plight, they all pitched in to buy him new clothes and his prescription medication. "These employees have suffered great losses themselves, and yet they had compassion to reach into their pockets to help one of their members in need. It was an incredible act of kindness," said Texas Credit Union League President/CEO Dick Ensweiler. "The employees of Firestone Community FCU are indicative of the credit union difference. We are, at our heart, a movement that puts people above profits. In time of need, credit unions have proven time and time again our capacity for caring," Ensweiler added. Firestone Community's Mauriceville branch escaped the brunt of the hurricane and is fully operational. Its Bridge City branch was submerged in about three and a half feet of water. Estimates are it will be six months to a year before it will be able to re-open. The credit union's Orange branch--its busiest--also took in a substantial amount of salt water and is non-operational. However, the credit union is setting up a mobile branch unit at the Orange location. The Mauriceville branch is operating under normal hours. Once the Orange mobile branch is operational, the credit union will offer extended service hours there. Although the Bridge City branch will not re-open for six to 12 months, no members of its staff are in danger of losing their job, said Achord. Achord emphasized that although there is damage to brick and mortar at two branches, members' money is safe, and the credit union is operating in a secure and sound manner. The credit union is making emergency loans available to members affected by Ike. On a case-by-case basis, it is allowing members additional time to pay an existing loan. "Our members have survived the storm and are now beginning the process of rebuilding. The last thing they need to worry about is whether their money is protected," Achord said. "Our focus is making sure our members' needs are tended to."

Shared branch assists member who lost house in fire

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LOUISVILLE, Ky. (9/25/08)--A credit union member who lost his home in a fire was able to get the funds he needed from his credit union through Shared Branching. Brook Asher, the son of Norman Asher, former president of the Kentucky Credit Union League, awoke to find his Lake Tahoe, Calif., home on fire. He jumped from a second-story bedroom window and watched his home burn to the ground, said the league (By the Way Sept. 25). Brook had lost everything, including his identification, and he needed funds. Norman knew that his son’s credit union was a Shared Branching participant, so he called Autotruck FCU, Louisville, to see what could be done to help. The next day, Autotruck FCU contacted Greater Nevada CU, Carson City, Nev., which agreed to have Brook come in to access his account without identification. “Shared Branching was a lifesaver in this situation,” Norman Asher said. “Within an hour, everything was in place to help my son. A disaster occurs when you least expect it. “Being able to communicate through Shared Branching network is a valuable service for any credit union,” he added.

Jersey league announces awards

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HIGHTSTOWN, N.J. (9/25/08)--The New Jersey Credit Union League honored several credit union professionals and credit unions with awards during its 74th annual league conference. Tom O’Shea, CEO of FAA Eastern Regional FCU, Clark, was awarded CEO of the Year. Robert Weir, director, Seaport FCU, Elizabeth, was awarded the Volunteer of the Year award. Other awards recipients:
*Raritan Bay FCU, Sayreville, the Desjardins Youth Financial Education award; * IFF Employees FCU, Hazlet, the Louise Herring Philosophy in Action award for asset sizes of less than $50 million; * Jersey Shore FCU, Cranford, the Louise Herring Philosophy in Action award for asset sizes of $50 million to $250 million; * Jersey Shore FCU the Dora Maxwell Social Responsibility award for asset sizes of $50 million to $100 million; and * CU of New Jersey, Ewing, the Dora Maxwell Social Responsibility award for assets sizes $200 million to $500 million.

NJCUL CEO outlines agenda

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HIGHTSTOWN, N.J. (9/25/08)--The 74th annual New Jersey Credit Union League (NJCUL) conference was also league President/CEO Paul Gentile’s first. Gentile discussed the league’s agenda for the upcoming year. The league is focused on two legislative areas: opening up municipal deposits for credit unions and enhancing the state charter, he told 785 attendees. It also opened a satellite office in Trenton and hired a contract lobbyist to improve governmental relations. Seven credit unions joined the league this year--including some that had not been active with the league for 15 years. “Getting more credit unions involved will always be a priority for me because it makes all of us stronger,” Gentile said. The league also branded itself in 2007 through a partnership with Rutgers University to advertise during sporting events. NJCUL has sponsored major events in the state, is running radio spots weekly on one of the state’s largest radio stations, and is using online media, Gentile added. Credit unions always will have political, regulatory and business challenges, but the credit union movement works best “when we work together,” Gentile said. He noted that the corporate credit union network needs cooperative support right now. “Cooperates have not been immune to the troubles on Wall Street,” he said. “While they can only invest in highly rated securities, all institutions have been affected. But the advantage corporates have is credit unions. “If credit unions stand tall now and support corporates by keeping their money in the corporate system, corporates will be just fine and this will go down as a great example of how cooperation can help the entire system,” Gentile added.

New Jersey league passes governance bylaws

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HIGHTSTOWN, N.J. (9/25/08)--During the 74th annual New Jersey Credit Union League conference, New Jersey credit unions approved three proposed bylaw amendments changing the league’s governance structure. Last year, the league appointed a governance task force to make recommendations on an appropriate governance structure. The board approved recommendations and presented them to the membership in bylaw amendments. The governance amendment:
* Reduces the league board’s size from 15 to 9; * Implements term limits of three consecutive, three-year terms; * Implements asset tiers for board representation with three seats for credit unions $25 million in assets and under, three seats for credit unions over $25 million and three at-large positions for credit unions of any asset size; * Requires board members to be either a president/CEO or director of a credit union in good standing with the league; and * Eliminates the geographical representation of the past governance structure. Board candidates can run for any of the three tiers from anywhere in the state. Beginning in October, all nine board seats will be up for election, with the new board seated in January 2009.
A second bylaw amendment changes the governance structure of the league’s service corporations by opening up board seats to individuals outside of the league board of directors, and creates a seven-person board with a chairman, vice chairman, and five at-large directors. Two of the directors will be league board members, and the other three will be from league-affiliated credit unions. A third bylaw amendment was amended from the floor to eliminate the need for a three-days’ notice for board meetings. Credit unions said the amendment would give the board flexibility to act on time-sensitive matters. An allowance for board meetings to be held every other month was approved.

Auto loan market shifting to used cars

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LOS ANGELES (9/25/08)--A sharp drop-off in new-car leasing programs may cause consumers to select a used car instead of a new car, and postpone their auto purchase for the present or purchase a less expensive car, according to a nationwide survey of 1,000 consumers. This will have an impact on credit unions, which traditionally rely on auto loans for a good part of their business. The survey by market researcher Synovate of Chicago for Global Debt Automotive, asked consumers: “The auto leasing business has experienced a shake-out of late: What do you plan to do if leasing becomes less available to you?” (BusinessWire Sept. 23). Thirty-seven percent of respondents said the recent sharp decline in new-car leasing programs would cause them to change their behavior:
* 19% of respondents would select a used car instead; * 11% would postpone their auto purchase for the time being; and * 7% would purchase a less expensive car.
Almost 40% of respondents said they were uncertain how the shake-out in auto leasing might affect their auto purchase plans. “The survey confirms what we’ve been hearing in the marketplace: that American consumers are uncertain how they will finance their next automobile and this uncertainty is causing them to consider a variety of options, including buying a less expensive new car, a used car, or postponing a purchase until conditions are more favorable,” said Michael Sheridan, founder and president of GDNAuto. He said the results are “bad news for car manufacturers and lenders who have discontinued popular leasing programs, and for the new car dealers who have relied on these programs to boost sales.” However, “there is a tremendous opportunity for used-car dealers and lenders to grow their business by introducing financing options that will have broad appeal to low- and moderate-income consumers being driven in growing numbers to used-car lots,” he added. Among the survey’s other key findings:
* Almost 20% of those 65 and older expect to postpone an auto purchase. At the opposite end of the age scale, consumers ages 18-24 are the least likely (11%) to buy the same new car they otherwise would have leased, and 14% of that age group say they probably will purchase a less expensive new car. * When it comes to buying vs. leasing the same car, household income is correlated with consumer expectations. Those with yearly incomes of less than $25,000 ruled out the purchase option (2.2 %), while that prospect grows as income rises. * Fully 47% of respondents from the South say they are uncertain about the best course of action, which may be why only 15% said they would be likely to purchase rather than lease a new car. Those in the Midwest are most likely to purchase rather than lease (27%), while Southerners are least likely to do so (15%). Those in the West are least likely to go the used-car route (14%) and most likely to forego the transaction entirely (15%). * Consumers employed full-time are most likely to purchase rather than lease the same car (25%)--but the self-employed are least likely to do so (14.5%). * The greater the level of education, the greater the likelihood that a consumer will purchase a new car when leasing isn’t an option.

Market crisis increases new accounts at Oregon CUs

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BEAVERTON, Ore. (9/25/08)--With the ongoing crisis in U.S. financial markets, Oregon’s credit unions are seeing an increase statewide in the number of people who are moving their money to perceived safer havens at credit unions. Troy Stang, president/CEO of the Credit Union Association of Oregon, said he’s hearing from CEOs around the state that significant numbers of people are moving their money to credit unions. “Credit unions in various parts of the state are seeing new members and old members alike coming in the door and asking about share insurance,” Stang told News Now. “Of course, the fact that Washington Mutual is in our backyard [Seattle] is causing concern among residents in our state.” Standard & Poor's downgraded the ratings of Washington Mutual (WAMU) and Washington Mutual Bank to junk status due to rising market turmoil. The Office of Thrift Supervision (OTS) largest institution, WAMU, could be acquired soon. WAMU has 20% of its assets under the OTS, and if the bank is acquired, the OTS could be forced to restructure (News Now Sept. 17). Stang was quoted in a Tuesday article in The Oregonian about people searching for a more secure place to put their money during the current financial crisis and after the failure of several large banks. “I’m glad The Oregonian took a look at credit unions as a viable alternative to other financial institutions,” Stang said.

Colombian government taps WOCCU to expand services

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MADISON, Wis. (9/25/08)--With backing from the Colombian government, the World Council of Credit Unions (WOCCU) has begun a US$1.5 million, two-year program to strengthen Colombia's credit unions and introduce technologies so they can provide financial services to the underserved.
A new World Council of Credit Union program will help Felix Arias Maldonado, a member of Coopesagua CU who owns a small watch repair stand in northern Colombia near the Venezuelan border, get access to financial services. (Photo provided by the World Council of Credit Unions)
The Colombian government, through its Banca de Oportunidades program, is funding the new program. WOCCU's program will work with Colombia's credit unions to develop strategic plans for financial strengthening and savings mobilization, and to implement new microcredit products and services to reach a broader membership. "The fact that the government of Colombia has noticed the significant financial, managerial and membership growth of these credit unions speaks highly of the level of technical assistance our projects provide to our credit union partners," said Mark Cifuentes, WOCCU senior vice president of technical services. WOCCU also will work with the existing WOCCU Services Group (WSG) office in Colombia, SumaRed S.A., to expand products and services to credit unions there. WSG offices are a new model of credit union service organizations that provide technical, operational and regulatory expertise to credit unions in countries where WOCCU has or had programs. They also assist credit unions in developing and implementing new technologies, products and services to reach underserved areas more efficiently and quickly. WSG offices currently exist in Bolivia, Colombia, Ecuador, Kenya, Mexico and Peru. Colombia's government reorganized the country's financial system following an economic recession that debilitated the credit union system more than a decade ago. It created a specialized supervisory unit and guarantee fund for the credit union sector. The country today has more than 200 credit unions, which serve 6% of the economically active population.

League on site at disaster location more funds needed

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FARMERS BRANCH, Texas (9/25/08)--The Texas Credit Union League is on site visiting credit unions in the East Texas coastal region ravaged by Hurricane Ike Sept. 13. League President/CEO Dick Ensweiler and a small team began touring the area Wednesday and will be there through Friday, according to Rick Grady, vice president of marketing, public relations and communications for the league. Today the group will visit members south and east of downtown Houston. Friday the team will visit on the west and north sides of downtown Houston. Return visits are being planned so the league's management team can address issues facing members, Grady said. The league's field team will remain in the area indefinitely, assisting members with rebuilding.
A trailer load of peanut butter--2,223 pounds of it--donated by Security Service FCU, San Antonio, is headed for ongoing disaster relief in Texas. The credit union presented the Food Bank of the Rio Grande Valley (RGV) Inc. with peanut butter collected at its South Texas branches. From left: Julie Balboa, assistant vice president of the credit union's South Texas District; Brian Epps. Food Bank RGV board members and credit union business development manager; Terri Drefke, Food Bank RGV executive director; Jim Bounds, credit union director of business development in South Texas; and Crystal Gomez, branch manager, Aransas Pass branch. (Photo provided by Security Service FCU)
The Texas Credit Union Foundation continues to receive large donations, which are being disbursed immediately to hundreds of applicants requesting assistance in the area. More than $135,000 in contributions was received as of Wednesday morning, and the foundation made $120,000 in grants to 247 individual applicants. The foundation said it has averaged 10 requests an hour since the process began, with the pace rapidly building. It indicated that additional donations will be needed. At sunup Wednesday, Galveston Island and the city of Galveston were permitting residents to return. Officials warned that the island remains a devastated place with few trappings of civilization and many serious health hazards. However, I-45 had a line of cars for 14 miles waiting for the reopening. It is estimated that 75% of homes will be uninhabitable. The African American Credit Union Coalition (AACUC) announced Wednesday it was donating $1,000 in response to the devastation and challenged credit unions, credit union organizations and leagues to "step up to the plate and contribute funds for the Texas recovery process." AACUC Chairperson Barbara Stephens, president/CEO of Houston Municipal Employees FCU, said the Texas league "has always offered a warm welcome to the AACUC. AACUC would like to extend a helping hand in return as they begin to rebuild their credit unions, homes and communities." Credit unions were creative in their donations as well. Security Service FCU, based in San Antonio, donated a trailer load of peanut butter, or 2,223 pounds, for ongoing disaster relief to a local food bank.

Study Debt stress increased as subprime crisis unfolded

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MADISON, Wis. (9/25/08)--Consumer debt stress increased from 2006 to 2007 as the subprime mortgage crisis unfolded, and those with the lowest household incomes are likely to endure the highest levels of debt-related stress, according to a new study by the Filene Research Institute. Consumer Debt Stress and Credit Cards, by Filene Executive Director and CEO Mark Meyer, explores debt-related stress with a focus on credit card debt. The study is based on information from Ohio State University’s Consumer Finance Monthly (CFM) survey. The CFM indicated that consumers in top stress categories who worry about overall debt Rose to 16.2% in 2007 from 14.7% in 2006. Consumers with lower household incomes experienced more debt stress than those with higher incomes. Those with prior bankruptcy filings also reported higher levels of debt-related stress, according to the study. Since 2005, the Center for Human Resource Research at Ohio State University has collected CFM data through monthly 25-minute telephone surveys using random-digit dialing and statistical weighting procedures. For more information, use the link.

CU System briefs (09/24/2008)

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* BOULDER, Colo. (9/25/08)--Boulder Valley CU (BVCU) has received approval from the Department of Housing and Urban Development (HUD) to offer members Federal Housing Administration (FHA) mortgage loans. The $169 million asset credit union is the only credit union in northern Colorado and one of the few to offer FHA mortgages, it said. FHA loans offer mortgage options for struggling homeowners and first-time home buyers. "BVCU's mission is to provide home buyer education and conduct responsible lending to the underserved within our community in order to promote responsible borrowing and home ownership," said Kimberley Morris, BVCU vice president mortgage lending … * HARAHAN, La. (9/25/08)--The Louisiana Credit Union League has promoted Jill Kitchens to director of education. Kitchens previously served as league government affairs specialist and was instrumental in advancing political advocacy fundraising and more. She has been in the credit union movement since 2002. In her new role, Kitchens will oversee the league's education department and assist credit unions in Louisiana with their education needs … * MUSKEGO, Wis. (9/25/08)--Corporate Central CU, located in Muskego, Wis., announced Wednesday it has hired Heather Paris as relationship development officer. Paris formerly served for five years as an assistant supervisor with Fort Community CU, Fort Atkinson, Wis. In her new role, Paris will meet with member credit unions and potential members to determine their needs and provide correspondent, investment and liquidity solutions. Corporate Central has 400 member credit unions nationwide … * ST. LOUIS (9/25/08)--Vantage CU has donated 16 personal digital assistant (PDA) SmartPhones to Cell Phones for Soldiers to help deployed soldiers call home for free. The phones, which were extras after a company-wide cell phone conversion, will be sold, with the proceeds used to purchase pre-paid calling cards for troops overseas. Matt Fagala of the $500 million asset credit union's information technology (IT) department coordinated the donation. From left are IT department staffers Leanne Doza, Ruben Bonales, Fagala, Rachel Shryock and Kelly Gillette. (Photo provided by Vantage CU) … * COLORADO SPRINGS, Colo. (9/25/08)--Ent FCU, based in Colorado Springs, was placed in the top 25 of tech-savvy mortgage lenders by Mortgage Technology Magazine, the $2.5 billion asset credit union announced Tuesday. Ent, a Prime Alliance client, implemented the Dexma Loan Origination Center and is adding Dexma Loan Fulfillment Center. Its use of technology enabled it to handle a 400% increase in Federal Housing Administration (FHA) loan volume during the past 15 months. Members can apply for the loans online at and check the status of their loan throughout the process …

Texas Sunset hearing goes well for state-charter CUs

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AUSTIN, Texas (9/25/08)--The Texas Credit Union Department (TCUD) presented a staff report Tuesday on state-chartered credit unions at the Texas Sunset Advisory Commission public hearing with good results, according to the Texas Credit Union League.
Dick Ensweiler, president/CEO of the Texas Credit Union League, testified before the Texas Sunset Advisory Commission on areas of concern for state-chartered credit unions.
The commission agreed that the TCUD should continue operating for another 12 years and discussed on two issues that had been of concern to credit unions and the league--continued consolidated filing of the Internal Revenue Service form 990s and the addition of monetary fines to the powers of the Texas Credit Union Commissioner. League President/CEO Dick Ensweiler testified on behalf of credit unions and was the only public witness before the commission. “We would like to commend the Sunset staff for the fine work they did in their review of the Texas Credit Union Department and the report they have issued,” Ensweiler said. Ensweiler then laid out the league's reasoning on two of the recommendations for continued filing of the consolidated 990. “Many credit unions have limited resources, both financial and in terms of personnel--often only a few employees work in a credit union,” he said. “Transferring this regulatory burden to each individual credit union will increase the cost and demands on the 218 credit unions who are included in the consolidated filing by the department. “With six different enforcement mechanisms available, the commissioner has had the tools needed. Clearly, the current system works,” Ensweiler continued.
Texas State Reps. Linda Harper-Brown (D-105) and Dan Flynn (D-2) listened to the Texas Sunset Advisory Commission state report and brought up issues with some of the recommendations.
The commission appeared to be receptive to league. There seemed to be no interest in consolidation, the league said. “I just want you to know that you have done an outstanding job,” said Commission member Rep. Dan Flynn. “The department is very well run and I appreciate the way you've protected members even though I've spent my entire career fighting credit unions.” Flynn is a former banker and former banking commissioner. State Rep. Linda Harper-Brown (D-105) focused on the 990 issue, questioning the burdens and costs to small credit unions by forcing them to file individual 990s when the joint filing runs $7,500 for the entire state.
Texas State Rep. Carl Isett (D-84), chair of the Texas Sunset Advisory Commission, invited testimony on the Texas Credit Union Department and the Sunset staff. (Photos provided by the Texas Credit Union League)
State Sen. Chuy Hinojosa (D-20) voiced a similar concern. “Won't that cost be borne by the members?” he asked. The public member of the commission, Charles McMahen, noted his concerns about recommendations on monetary penalties. The former president of Compass Bank suggested that monetary penalties could be misused. Flynn confirmed with staff of the Sunset Commission that the Banking Department has no such monetary penalty power either. “It was a good day for credit unions,” said Jeff Huffman, league vice president for governmental affairs. “Clearly the Sunset Commission understands our concerns, and we hope they will incorporate them into their final report.” The Commission's decision hearing will be held on Dec. 16-17.

PCUA CEO testifies on CUs financial conditions

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HARRISBURG, Pa. (9/25/08)--Jim McCormack, president/CEO of the Pennsylvania Credit Union Association (PCUA), testified on behalf of credit unions before the State House Commerce Committee about current financial market conditions and their effect on Pennsylvania.
Jim McCormack, president/CEO of the Pennsylvania Credit Union Association, testified before the State Commerce Committee that Pennsylvania credit unions are healthy and well-capitalized. (Photo provided by the Pennsylvania Credit Union Association)
Credit unions will be affected indirectly in the long term by the current credit crisis, but credit unions are well-capitalized and have healthy reserves, he explained to the committee (Life is a Highway Sept. 24). “Our deposits grow organically. We have healthy balance sheets, and we’re in the business of lending to consumers,” McCormack said. Also testifying were Steven Kaplan, secretary of banking; Robin Wiessmann, state treasurer; and representatives from the Pennsylvania Securities Commission, including: Robert Lam, acting chairman; Michael Byrne, chief counsel; and John Quinn, director, corporation finance. The committee will hold a future meeting after the U.S. Treasury unveils its proposal, PCUA said.

Current market differs from Rhode Island collapse

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EAST PROVIDENCE, R.I. (9/24/08)--The problems facing today's financial market are different from those that caused a number of banks and credit unions in Rhode Island to collapse in 1991, said state regulators and industry experts. There are two key differences, regulators told The Providence Journal (Sept. 18):
* The current crisis on Wall Street relates mainly to investment banks, which do not take deposits--not regular banks that accept deposits and make loans, said Allan W. Graham, professor of accounting at the University of Rhode Island's College of Business Administration. * The deposits of the collapsed institutions in 1991 were insured by a private firm, the Rhode Island Share and Deposit Indemnity Corp. (RISDIC), which failed, said A. Michael Marques, director of the Rhode Island Department of Business Regulation. Today all depository institutions in the state carry federal deposit insurance.
The current financial market crisis stems from subprime loans, or mortgage loans made to risky borrowers, Graham told the newspaper. The loans were assembled by the investment banks into packages and sold to investors as "high quality corporate debt." When homeowners defaulted, the investment packages dropped in value, crippling investment banks and hurting investors who bought the packages, Graham said. Big, national banks that expanded into investment banking are affected. But smaller local banks and credit unions don't have the exposure to those risky assets that were the problem for the big failures, said Graham. Credit unions and smaller banks are more conservative and the state's banks and credit unions are safe, he said. Marques says institutions aren't totally immune from today's economy. They may see an uptick in delinquencies but that is what institutions expect when they lend, he said, noting that "it's manageable." He told the paper that overall, banks and credit unions in Rhode Island are safe and sound. The article reported that independent research and rating firm Veribanc analyzed 40 banks, credit unions and thrifts based in the state and ranked 26 of them with the highest safety rating. None received its lowest possible rating. Credit unions and banks in the state today have federal insurance that would kick in if an institution failed, the newspaper said. While depositors recovered their funds from the RISDIC crisis via a state-backed bailout, federal insurance would provide full coverage to today's depositors up to $100,000 per depositor, per account category, per institution, the article said.

League announces status of Galveston CUs

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FARMERS BRANCH, Texas (9/24/08)--The Texas Credit Union League was still trying Tuesday to obtain a status report from two credit unions located in Galveston, the city hit hard by Hurricane Ike on Sept. 13. They are Galveston School Employees FCU, a $5 million asset credit union with roughly 1,721 members, and Electrical Workers 527 FCU, a $1.4 million asset credit union with about 550 members. Five credit unions, including those, have headquarters in Galveston. Two other credit unions located elsewhere have a branch in Galveston, reported the league. The status of the five headquartered in Galveston:
* Coastal Community FCU: The credit union's Galveston branch is closed, but its La Marque branch is open. It also has a satellite branch at the San Luis Hotel for all city and hotel employees only. The credit union has $36.4 million in assets and more than 89,333 members. * Electrical Workers 527 FCU: The league is working to obtain a status report. It has one branch. * Galveston Government Employees FCU: Its Galveston branch closed. The $9.5 million asset credit union has temporarily moved to a site in League City, where it is operating from a mobile unit. * Galveston School Employees FCU: The league is working obtaining a status report. It has one branch. * Island Teachers FCU: The Galveston branch is closed. It is temporarily serving members from an alternate site at Associated CU of Texas in La Marque. Island Teachers is a $605,351 asset credit union with more than 586 members.
Galveston also had branches of two other credit unions. Their operational status:
* JSC FCU: Headquartered in Houston, this credit union's Galveston branch "is located in the historical strand area and took in about six feet of water," said the league. "It has 15 branches in the Houston area. All are open except for the Galveston, La Porte and Seabrook locations." The credit union has $1 billion in assets and 106,544 members total. * University FCU: Based in Austin, the credit union reported to the league that its Galveston branch is closed. The credit union has a temporary service center available at AMOCO FCU's Bay Colony Branch in Dickinson. University FCU has $929 million in assets and more than 123,578 members.

Seattle CUs banks work with city to serve unbanked

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SEATTLE (9/24/08)--The city of Seattle is collaborating with 22 credit unions and banks to offer services to people who are unbanked to make it easier and more affordable for them to open savings and checking accounts. Roughly 52,000 households without traditional banking services in King County, Washington--the county where Seattle is located--pay an annual average of $800 in check-cashing fees, the city said (The Seattle Times Sept. 23). There are seven credit unions participating in the program, Linda Jekel, director of credit unions for the Washington State Department of Financial Institutions (DFI), told News Now. Seattle modeled the initiative after a similar program that has been running for about two years in San Francisco. Participating financial institutions there have about $4 million in deposits from new customers, according to the Federal Reserve Bank of San Francisco. Seattle’s goal over the next two years is to get 10,000 people to open accounts, and to have 80% of the accounts remain open for at least one year, the paper said. Credit unions and other financial institutions provide financial education to participants in the program. Most of the participating financial institutions allow people to open accounts with $50 or less, and all but two offer free checking. The others charge $6 per month in fees. Participating credit unions in some instances are offering low-cost and minimum balance accounts. The city’s initiative will help credit unions market their services to new population segments, including outreach to immigrant groups, the Times said. Once people get in the door of affordable financial services, they can learn how finances work and become better financial citizens, Scott Jarvis, director of the Washington State DFI, told the paper. The seven Seattle-area credit unions participating in the inititative are: Boeing Employees CU, Express CU, Seattle Metropolitan CU, Verity CU, Washington State Employees CU, Watermark CU and Woodstone CU.

Ex-chiefs of staff headline California-Nevada league convention

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RANCHO CUCAMONGA, Calif. (9/24/08)--Leon Panetta, chief of staff to former President Bill Clinton, and Andrew Card, former chief of staff to President George W. Bush, will give their perspectives on the November presidential election and implications for the nation at the California and Nevada Credit Union League’s Annual Meeting and Convention. The event takes place Nov. 5-7 in San Francisco with the Panetta and Card presentations set for Nov. 6--two days after the national presidential election. Also among the speakers at the convention will be Anna Quindlen, a Pulitzer Prize-winning journalist, Newsweek columnist and best-selling author, who will provide her perspective on current events and issues. Other speakers include former NFL football player, author, actor and humanitarian Rosey Grier, and economist Esmael Adibi, director of the A. Gary Anderson Center for Economic Research and Anderson Chair of Economic Analysis at Chapman University. “This year’s convention is well-timed to address the current economic and political challenges the nation is facing,” said Bill Cheney, the leagues’ president/CEO. The convention theme, “YOU make the Movement Shine,” salutes credit unions and members in celebrating the 75th anniversary of the California Credit Union League.

Massachusetts adopts stricter consumer data rule

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BOSTON (9/24/08)--Massachusetts state regulators released new rules Tuesday to make businesses better safeguard consumers’ personal information. The Massachusetts Office of Consumer Affairs and Business Regulation issued the regulations, which require companies that handle personal information--such as Social Security numbers and credit card accounts--to encrypt stored data, monitor employees’ access to the data, and take other measures to safeguard customer information. They become effective Jan. 1 ( Sept. 23). Massachusetts Gov. Duval Patrick also signed an executive order that requires state agencies to take similar precautionary measures. Consumer concern about the increasing number of data breaches containing personal information prompted the state’s action, Daniel Crane, Massachusetts undersecretary of consumer affairs and business regulation, told the paper. Hundreds of credit unions nationwide had to reissue thousands of plastic cards to members as a result of the TJX Cos. data breach, which exposed the personal information on at least 45.67 million cards. TJX operates TJ Maxx and Marshalls stores. Other data breaches this year include supermarket company Hannaford Bros., mortgage company Countrywide Financial Corp., and Bank of New York Mellon.

Minnesota Network announces state award winners

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ST. PAUL, Minn. (9/24/08)--The Minnesota Credit Union Network (MnCUN) announced the statewide winners in its 2008 Dora Maxwell, Louise Herring and Desjardins competitions. All three awards are sponsored by MnCUN and the Credit Union National Association. Dora Maxwell winners are:
* Heartland CU, St. Paul, $50 million to $100 million in assets; * Mid-Minnesota FCU, Baxter, $100 million to $200 million; * TopLine FCU, Maple Grove, $200 million to $500 million; and * US FCU, Burnsville, $500 million and more.
Louise Herring winners are:
* Fort Snelling FCU, Minneapolis, less than $50 million in assets; * First Alliance CU, Rochester, $50 million to $250 million; and * US FCU, greater than $250 million.
Desjardins Youth Financial Education Award winners are:
* Anoka Hennepin CU, Coon Rapids, $75 million to $250 million in assets; and * City-County FCU, Brooklyn Center, greater than $250 million.

Take a look at CUs--New Jersey publication

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NEWARK, N.J. (9/24/08)--Those who want to own part of a financial institution without buying its stock should look at credit unions, according to Alky Danikas, lecturer of finance and economics at St. Peter’s College and “Money 101” columnist for The Jersey Journal. He encouraged readers to find credit unions within their fields of memberships, and compared their rates with those of banks. As of Thursday, the top 50 credit unions surveyed by were charging 12.97% interest compared with the national average of 14.88% on credit cards. Credit unions also were paying 4.3% on certificates of deposit, compared with 3.94% by thrifts and 3.33% by banks, he said (The Jersey Journal Sept. 22). For the full article, use the link.

Study Success depends on employees perceptions

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MADISON, Wis. (9/24/08)--Credit union employees have a hard time explaining how credit unions fit into society, according to a new Filene Research Institute study that outlines connections between employees' perceptions of their credit unions and the service provided. The institute asked anthropologists John B. Gatewood of Lehigh University and John W. Lowe of Cultural Analysis Group to study the dominant views of credit union employees toward their organizations. Results are outlined in a newly released report, Employee Perceptions of Credit Unions: Implications for Member Profitability. The study hypothesizes that credit union success is critically dependent on its employees and is likely to be strongly colored by employee perceptions of credit unions. Employee attitudes influence their work behavior and their interactions with members, and play a significant role in employees' abilities to recruit new members through word of mouth, said Gatewood and Lowe. The findings:
* Employees can't neatly compartmentalize how a credit union fits into society. * Employees agree on the "credit union idea" but have difficulty explaining that idea to external parties. * Employees can identify the parts of the credit union puzzle, but they don't see how they all fit together. * "Trusted" is the highest rated characteristic attributed to credit unions. * Employees younger than 30 and those with higher levels of education are less committed to credit unions. * Significant variance exists across institutions in employee commitment and in the consensus of what a credit union represents.
"Many firms, especially in the financial services industry, present hollow claims on differentiation," said George Hofheimer, Filene chief research officer. "But credit unions are truly different. This study indicates that differentiating factors map very well to what many people view as the ideal financial institution," Hofheimer said. "In short, credit unions have a unique story to tell, and like most really good stories, it takes time to get the pitch right." Researchers asked employees several questions, including:
* How do employees think about credit unions? * What are the areas of consensus and of disagreement? * Do knowledge and attitudes toward credit unions vary in a meaningful way? * How deep does their commitment to the ideology of credit unions go? * How is the image of credit unions projected to members?
The report is available free to institute members and for $125 for non-members. For more information, use the resource links.

Chinese CU leaders in U.S.

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WASHINGTON (9/24/08)--Six representatives from the Zhejiang Province Rural Credit Cooperative Union in eastern China visited three U.S. credit unions and the Credit Union National Association (CUNA) last week to learn about U.S. credit union operations. The World Council of Credit Unions (WOCCU) facilitated the trip geared to help Chinese credit unions take best practices from U.S. credit unions back to Chinese soil.
Eric Richard, Credit Union National Association (CUNA) executive vice president and general counsel, discussed CUNA's structure with a visiting Chinese delegation. (Photos provided by World Council of Credit Unions)
The group began in California, where they learned how credit unions serve members at the grassroots level at Northeast Community FCU and San Francisco Lee FCU. Both credit unions serve San Francisco's Chinatown community. Farther east, the Chinese delegation discussed credit union operations and risk management efforts with Municipal CU (MCU) President/CEO Kam Wong and his staff in New York City. The Chinese visitors were particularly struck by MCU’s ability to survive the attacks and events of 9/11. The credit union is located across the street from the World Trade Center site. MCU lost its information technology systems and was forced to temporarily relocate its headquarters in the months following 9/11. U.S. capital requirements was the topic of interest during the group's final stop in Washington, D.C., to visit with Eric Richard, CUNA executive vice president and general counsel, and Michael Edwards, CUNA counsel for special projects.
Click to view larger image Learning about risk management efforts at Municipal CU (MCU), New York, were from left: Xiao Zhenhai, Yuhang Rural Cooperative Bank; Ralph Pagan, Carole Porter and Janet Perkins, all of MCU; Lin Yuqing, Zhejiang Provincial Rural Cooperative CU; Norman Kohn, MCU; Andrea Dannenberg, World Council of Credit Unions; Kam Wong, MCU; Xu Guoxing, Zhu Fanyu, Ying Chaohui and Lin Wei, all of Zhejiang Provincial Rural Credit Cooperative Union; and Ana Puello, MCU.
Chinese rural credit cooperatives must have at least 4% in capital reserves, which is half the requirement for Chinese banks. Edwards also discussed how U.S. credit unions manage risk through minimum net worth capital requirements and limited investment powers. The group also learned more about National Credit Union Administration share deposit insurance and how it might be applied to the credit union environment in Zhejiang. “I was particularly impressed by the size of the Zhejiang credit union system and the level of service they offer to members,” Richard said. “Mr. Zhu explained they have 81 member credit unions, serving 25 million households through 4,000 branches. With $80 billion in assets, this is a huge credit cooperative system.” The Chinese delegation was led by Zhu Fanyu, director-general of Zhejiang Provincial Rural CU, and included staff members Lin Wei, human resources section chief; Lin Yuqing, director of the Quzhou office; Xu Guoxing, risk management section chief; and Ying Chaohui, secretary. Xiao Zhenhai, board chairman of Yuhang Rural Cooperative Bank in Zhejiang Province, also joined the group.

Daredevil NCUA and mom speakers at N.Y. league convention

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ALBANY, N.Y. (9/24/08)--The Credit Union Association of New York announced speakers for its annual convention Oct. 7. The event will take place in Niagara Falls Oct. 6-8. “The theme of this year’s convention is ‘harness the power’ and each of these individuals has done just that in their life, for credit unions and the human spirit,” said William J. Mellin, association president/CEO. Speakers include Alison Levine, president, Daredevil Strategies; Rodney E. Hood, National Credit Union Administration (NCUA) vice chairman; and Jill Kelly, co-founder, Hunter’s Hope Foundation. Levine will speak about organizational effectiveness, leadership development and team dynamics. She has an 18-year business career in healthcare, technology and finance. She has worked at Goldman Sachs and served as deputy finance director for California Gov. Arnold Schwarzenegger. Hood will present a general issues update. Prior to his appointment as NCUA vice chairman, he worked as association administrator of the Rural Housing Service in the U.S. Department of Agriculture. He addressed the housing needs of rural America and helped administer a $43 billion dollar mortgage portfolio. Kelly, wife of former Buffalo Bills quarterback and pro football Hall of Fame member Jim Kelly, will provide information about Hunter’s Hope, a foundation she and her husband established in 1997 after their son, Hunter, was diagnosed with Krabbe Disease.

CU System briefs (09/23/2008)

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* HARRISBURG, Pa. (9/24/08)--Citadel FCU, based in Thorndale, Pa., hosted an event for U.S. Rep. Jim Gerlach Monday in Malvern. Gerlach, shown here speaking to the group, provided an update about the federal bailout, reflections on the current financial services marketplace, the campaign of Republican presidential candidate John McCain, and the congressional session's agenda (Life is a Highway Sept. 23). Among attendees were Pennsylvania Credit Union Association (PCUA) President/CEO Jim McCormack and Christina Mihalik, PCUA associate vice president, governmental affairs; Jay Murray and Lori Gall of Mid-Atlantic Corporate FCU; Mike Kaczenski, PCUA board director and CEO, Sun East FCU; and Carol Humerick, PCUA Governmental Affairs Committee member and Citadel FCU senior vice president. (Photo provided by the Pennsylvania Credit Union Association) … * ST. LOUIS (9/24/08)--Blaine Luetkemeyer, Republican candidate for Missouri Congressional District 9, visited Columbia-based Missouri CU's Jefferson City branch Sept. 12 (The Missouri Difference Sept. 19). He met with Hal James, Missouri CU; Betty Clark, United CU, Mexico; Laura Royse, Tigers CU, Columbia; and Missouri Credit Union Association's (MCUA) President Rosie Holub and staffers Peggy Nalls and Amy McLard. Luetkemeyr is a former state representative whose family owns a bank. He faces Democrat Judy Baker, who supports credit union issues in the November election. MCUA also met with John Hagler, policy advisory to Democrat Jay Nixon, who is facing Republican Kenny Hulshof in the governor's race. (Photo provided by the Missouri Credit Union Asssociation) … * NORTHVILLE TOWNSHIP, Mich. (9/24/08)--Martha Ninichuk, vice president of consulting at the Maryland/District of Columbia Credit Union Association (MDDCCUA), has been hired by the Michigan Credit Union League (MCUL) as its new director of membership relations (Michigan Monitor Sept. 22). Prior to joining MDDCCUA about two years ago, Ninichuk spent six years at the World Council of Credit Unions. Her assignment in Macedonia involved working with the Michigan league and its service corporation. She is a former CEO of St. Cletus CU. She will oversee MCUL's credit union relations department and will supervise its CRI International Partnership, financial education programs and the Michigan Credit Union Foundation … * SAN DIEGO, Calif. (9/24/08)--Debra Schwartz has been selected as president/CEO of Mission FCU, announced Mission Federal Board Chairman Don Shelton. Schwartz has been serving in the dual role as interim CEO and executive vice president since the April 2008 retirement of former President/CEO Ron Martin. Schwartz has more than 25 years of financial services leadership experience. Prior to joining Mission Federal, she served as chief financial officer at First Future CU and as executive vice president at San Diego County CU, both based in San Diego … * ST. LOUIS (9/24/08)--Two long-time volunteers were honored by the Missouri Credit Union Association (MCUA) for their commitment and contributions. Jacques Sachs and Merl Wilhelm were named to the Missouri Honor Roll on Sept. 16. Sachs has volunteered for TelComm CU, Springfield, for more than 55 years. Wilhelm has served CU Community CU, Springfield, for nearly 45 years. The presentation was made during MCUA's Convention and Exposition. The Missouri Honor Roll plaque is on permanent display at Missouri Credit Union House, Jefferson City (The Missouri Difference Sept. 19) … * BRATTLEBORO, Vt. (9/24/08)--Two Vermont CUs have announced a proposed merger, pending approval by members and state regulators. Merging would be Windham County VEA CU in Dummerston, a $1.6 million asset credit union--the second smallest in the state--and the state's sixth-largest credit union, River Valley CU, Brattleboro, with $45.2 million in assets ( Sept. 23). Windham County VEA CU approached the larger credit union about the merger proposal, saying it wanted a partnership so it could offer its members more products and services, according to River Valley President/CEO Jeffrey Morse. A public hearing is planned for Oct. 3 on the proposal. Morse told the publication it was hoped the deal could be completed by mid-October …

Funds rolling in to help CUs says league

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FARMER'S BRANCH, Texas (9/23/08)--As of late Monday, the Texas Credit Union Foundation (TCUF) had received over $114,400 in donations and $29,000 donated through CUAid from credit unions and individuals across the nation to assist credit union employees affected by Hurricane Ike. The National Credit Union Foundation (NCUF), which is collecting from credit unions not based in Texas, had, as of Monday afternoon, more than $60,000 in its Disaster Relief Fund, said Steve Bosack, NCUF deputy director. The Texas foundation already has provided $103,297 in emergency grants to credit union staff affected by the Sept. 13 hurricane. In an update Friday, the Texas Credit Union League said that "grant requests have been coming across the fax machine non-stop." Credit unions across the country have shown tremendous compassion and generosity, said league President/CEO Dick Ensweiler. From generators to office equipment to mobile branches, the credit union community was quick to respond to the needs of the credit unions in Southeast Texas, he said. The road to recovery remains a long one, and the league will continue working with the Ike-affected credit unions, matching their needs with available resources, Ensweiler said. He noted that credit union staff have been left homeless or with more damage than they can handle. "We need to make sure they understand they are not alone and that their credit union family stands ready to help them through the difficult process of rebuilding." While credit unions in Texas are being encouraged to make donations directly to the TCUF Disaster Relief Fund, those in other states are encouraged to donate funds through, NCUF's primary disaster relief fund. For more information on both, use the first resource link. For a map of where credit unions hit are located and their status, use the "map" resource link.

128 CUs damaged by Ike now fully operational

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FARMER'S BRANCH, Texas (9/23/08)--Of the 188 credit unions in Texas damaged by Hurricane Ike, 128 are now fully operational and another 55 have some degree of restored service. Only five, located in the hardest hit areas, remain non-operational, said the Texas Credit Union League. "We are proud, to say the least, of how well the credit union community has pulled together to make sure that institutions in the affected area have the support and resources needed to get back up and running for their members," said league President/CEO Dick Ensweiler. "It's hard to imagine any other industry that would send resources to 'competitors.'" "In this time of crisis, credit unions have demonstrated once again that the cooperative nature of our movement is its greatest strength. The focus remains on what is most important: the owners/members of our institutions," he said. For an update on fundraising, see the story, "Funds rolling in to help CUs, says league." The city of Galveston, Texas, hit hard by Hurricane Ike, will begin permitting its residents to return to the island tomorrow as some of the essential utilities and services have been restored. "This is good news for the five credit unions that are located on the island," said Rick Grady, Texas Credit Union League vice president of marketing, public relations and communications. The west end of the island will still be closed for a period because of "serious destruction" to roads and because debris still exists. "The Bolivar Peninsula is still inaccessible by road. Hurricane Ike "peeled nearly every road off the ground and threw much of it into Galveston Bay," said Grady in an update Monday morning. Only high-profile vehicles and boats can reach much of the peninsula. Electrical power continued to be a concern in some areas. As of Monday morning, nearly 1.8 million customers have regained their power, with 852,000 still without power. Most of those were in Harris County. Running water and sewer operations also are beginning to be restored.

REAL Solutions goes to New Jersey

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HIGHSTOWN, N.J. (9/23/08)--The New Jersey Credit Union League and the New Jersey Credit Union Foundation have teamed up to assist low-wealth members in breaking the cycle of debt by bringing REAL Solutions to the state. League President Paul Gentile made the announcement Sunday at the league's annual convention. REAL Solutions is a program of the National Credit Union Foundation (NCUF) that provides "Relevant, Effective, Asset-building, and Loyalty-producing (REAL)" services. NCUF designed the program to work with state credit union leagues to help credit unions offer turnkey services, such as payday lending alternative loans, to members. "With the financial strife gripping America, there has never been a more important time for New Jersey credit unions to step up to help members in need of affordable financial services," said Gentile. The New Jersey foundation has committed to funding the program for the initial year. League staff will help manage the program and work with credit unions to develop REAL Solutions in their credit unions, with the help of a field coach assigned by NCUF. The New Jersey foundation is funded through credit union investments in the Community Investment Fund, and through direct donations. For more information, use the resource link.

Commission approves Illinois CUs student loan program

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CHICAGO (/23/08)--The Illinois Student Assistance Commission has given its go-ahead for a $100 million plan for student loans in an arrangement with eight credit unions in the state. The commission, in charge of student loans, met in Evansville and approved the arrangement, which was announced earlier this month (News Now Sept. 8). Andrew Davis, commission executive director, said he approached 12 major banks and at least six foreign banks to invest in student loans. But, he said, major lenders across the nation have bailed on student loans to shore up their finances during the subprime mortgage crisis (Belleville News Democrat Sept. 20). Some states, he said, shut down their student loan programs. The credit unions are a unique solution in the U.S., Davis said. The $100 million investment will provide loans for as many as 20,000 college students per year, he said. Credit unions in the program include:
* Alliant CU, Chicago; * Baxter CU, Vernon Hills; * Citizens Equity First CU, Peoria; * Corporate American Family CU, Elgin; * Credit Union 1, Rantoul; * I.H. Mississippi Valley CU, Moline; * Motorola CU, Schaumburg; and * Scott CU, Collinsville.
For more detail about the plan, use the first resource link.

Missouri announces Desjardins Herring Maxwell awards

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ST. LOUIS (9/23/08)--The Missouri Credit Union Association announced the recipients of the state-level Dora Maxwell Social Responsibility Award, the Louise Herring Award for Philosophy in Action and the Desjardins Youth Financial Education Award (The Missouri Difference Sept. 19). Dora Maxwell first-place winners include:
* Joplin (Mo.) Metro CU, $5 million to $20 million in assets; * Raytown-Lee’s Summit Community CU, Raytown, $20 million to $50 million; * Central Missouri Community CU, Warrensburg, $50 million to $100 million; * Mid Missouri CU, Ft. Leonard Wood, $100 million to $200 million; * Mazuma CU, Kansas City, $200 million to $500 million; and * CommunityAmerica, Kansas City, more than $500 million.
Louise Herring first-place recipients include:
* Raytown-Lee’s Summit Community, less than $50 million in assets; * St. Louis (Mo.). Community CU, $50 million to $250 million; and * Vantage CU, Bridgeton, more than $250 million.
Desjardins first-place winners are:
* Raytown-Lee’s Summit Community, $35 million to $75 million in assets; * Gateway Metro, St. Louis, $75 million to $250 million; and * Vantage CU, more than $250 million.

West Community CU helps biz member through flood

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ST. LOUIS (9/23/08)--A St. Louis-based credit union went to the aid of several local business members hit hard by storms from the remnants of Hurricane Ike. Storms from Ike swept through the area on Sunday, Sept. 14, says the Missouri Credit Union Association (MCUA) (Missouri Difference Sept.19).
Flooding in Brentwood, Mo., after remnants of Hurricane Ike hit the St. Louis area. (Photo provided by the Missouri Credit Union Association)
West Community CU in O'Fallon stepped in to help members, including American Lock and Key in Brentwood. Six feet of flood water submerged everything inside the business' office building, including desks, computers and paper files, and the company's vans and trucks outside. West Community Business Representative Jeff Hinrichs volunteered his personal time to help business owners and staff clean up the mess that Sunday night, hauling boxes and doing anything else needed, said MCUA. "It was great to see that even in the face of adversity, our members had such a great attitude," said Hinrichs. "No one was feeling defeated or ready to give up." The $109 million asset credit union implemented several measures to address members' needs due to storm damage. It is expediting check reorders, helping provide copies of old statements, and processing loan requests quickly to replace lost equipment.

Employees in Galveston face ordeal with humor

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FARMERS BRANCH, Texas (9/23/08)--Employees of JSC CU’s Galveston, Texas branch laughed when they had to “launder” the credit union’s money last week to get rid of the dead fish odor. JSC CU was hit by Hurricane Ike, which made landfall in the area Sept. 13. Part of the credit union--including its money--was underwater (LoneStar Leaguer Sept. 22). Joetta Petteway, JSC CU branch manager, and assistant branch manager, Lisa Cannon, dressed in rubber boots and gloves to get the money out of the submerged credit union’s vault and ATM. Becky Day, JSC marketing coordinator, told the Texas Credit Union League the money had to be washed, dried with lavender dryer sheets because of the fish odor, and ironed. “We were literally laundering money--no pun intended,” Day said. The lavender aroma “beat the heck out of dead fish odor. We all got a good laugh out of the ordeal,” she added. Petteway has not been able to return to her home on Galveston Island since the storm. She left her home before Hurricane Ike hit to stay with her sister in Texas City. Petteway’s home remained intact after the storm, although houses surrounding hers sustained major damage. Despite not being able to enter her home after Ike, Petteway reported to work Tuesday after the storm at one of JSC’s Houston branch. “This just goes to show the dramatic lengths our people will go to in order to help others in the community,” said league President/CEO Dick Ensweiler. “It’s selfless, heartwarming and an inspiration to all of us in the credit union community.”

Three CUs receive OpSS Council Best Practices awards

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MADISON, Wis. (9/23/08)--Three credit unions were the winners of the fourth annual CUNA Operations, Sales and Service (OpSS) Council’s Best Practices Awards, which recognize innovative solutions that optimize credit union performance. The award winners delivered presentations on their entries during the council’s 11th annual conference, which took place last week in Williamsburg, Va. Mayo Employees FCU, Rochester, Minn., won in the Sales and Service Management category for its Swashbuckler program. The program was created to push positive loan growth and ease the pressure on its members due to the economy. The credit mining initiative prompts lenders to begin a conversation with members about loans and credit card debt they may have at other financial institutions. The credit union offers them the credit union’s lower rates. In the first three months, the program garnered nearly $516,000 in new consumer lending money. Tucson (Ariz.) Old Pueblo CU won in the Branch Design category for its new branch design that reflects the community and the Southwest. Its entrance offers three options--the investment/real estate area, an ATM vestibule and the main branch. The separated areas allow the investment/real estate department to conduct business after regular branch hours for added member convenience. The main branch was designed to feel friendly and inviting, rather than commercial. Its Internet station allows members to conduct online banking or do personal computing. It also features an open kid’s area, and a waiting area designed like a Southwest-style living room. The exit features a “Hero Wall” to honor Tucson citizens who exemplify the community spirit. The environmentally friendly branch realized $3.8 million in new deposits, 56 new checking accounts, and 11 new real estate referrals in the first two months after opening. Financial Partners CU, Downey, Calif., won the Call/Contact Center award category for its POD system. The system reorganized its contact center and broke representatives down into small teams (PODs). The team encourages open communication, forward thinking, sales performance, friendly competition, and cross pollination of best practices to enhance the member experience. Representatives are better prepared to handle member inquiries, resulting in improved service quality and Net Promoter scores. Checking production increased by 40% in one month and transferred calls decreased by 35%. The awards were created to identify, recognize, and share new approaches and solutions with universal application in the credit union movement. Winners were chosen, without regard to credit union asset size, based on strategy, process, application, and results.

Communications technology spotlighted during Ike

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MADISON, Wis. (9/22/08)--What Hurricane Katrina did for shared branching, Hurricane Ike is doing for communications technology. Credit unions who went through Katrina still speak of the role that shared branching played in helping their members recover from that ordeal. In the Ike recovery, while shared service centers again play a key role, various technologies also have been crucial in communicating with members and with each other. Those technologies included using Intranets to keep employees informed; website postings for members; cell phones and text messaging; special phone systems with "hot-line" numbers; voice messages; league Web pages that charted credit unions' conditions and status; blogs from credit union staff and members; videos and podcasts; e-mail alerts and updates; and conference calls, among others. Before Ike hit the Texas/Louisiana gulf coasts Sept. 13, credit unions already had communicated their business continuity plans with members and staff. The Texas Credit Union League provided e-mail weather updates and maps as the hurricane moved inland. After Ike hit, the league provided details of the areas hit, the rescue and recovery efforts, the damages, and the impact on the state's power and utilities infrastructures. After the storm, league representatives--some of whose homes were affected--began contacting roughly 180 credit unions in the area to determine their condition and status, said Rick Grady, league vice president of marketing, public relations and communications. The lack of power meant many credit unions could not be reached by e-mail, but the league e-mailed them anyway, "just in case they were able to receive information through that communications channel," he said. "Cell phones were the most-used channel," he said, adding that the league employed both voice, voicemail and text messaging. "Many times, when cell relay stations would become overloaded with voice calls, text messages would still go through," he said. The different channels enabled the league to contact "in some fashion" all credit unions in the affected area. The league also set up special Web pages for credit unions to report their status, then charted it onto a single page. It created a database for a matchup of needs and donations. Communications technology was integral in appeals for aid. Contributions were gathered via a special website, Appeals--including video appeals--were sent via e-mail, press releases, and websites. Credit unions could keep track of the devastation on the league's web site,, which also posted photo slide shows of the area's devastation. Regulators and insurance adjusters assessing damages also kept in contact and used e-mail and websites extensively. Before the storm hit, credit unions focused on communicating their business continuity plans to members. Every credit union provided key contact information, including cell phone numbers, so they could be contacted. They employed the Web, phone systems and e-mail alerts. They left voice mail messages telling members which branches were open or closed, how to make insurance claims, and where to go for shared branches, and generally voiced concern everyone would come out of the storm intact. Credit unions and the league also used video technology via and podcasts to communicate. The day after the hurricane hit, Texas Dow Employees CU (TDECU) provided the earliest and one of the most stirring accounts of what credit unions were going through: a video of a pep talk and thank you by its CEO to staff manning the call center. TDECU's blog on also updated staff and members on what it was doing to prepare for the hurricane, what assistance it was providing to employees and members, various alerts from local authorities, and even thank you notes from staff. But, like in any disaster, all the technology didn't always work. Overloaded calls to some credit unions meant long waits in queues or busy signals. Others' communications were down; calls to those got dead air. Phone calls would get cut off in mid-sentence. Internet services for some went down. And some credit unions didn't make full use of the technologies available. Throughout last week, News Now checked websites of credit unions in the area. Unlike the situation during Katrina, only a handful of credit unions did not have a website. News Now's staff saw a range of information available. Some websites ignored the storm entirely and provided no updates. Some updated their sites when they closed before the storm but posted no information after it hit; visitors had to assume they were closed. Other credit unions made savvy use of their sites. They provided extensive information about which branches were closed and open, their hours, what members should do to access their funds, how to process insurance claims, and links to many services. They also used their websites to express concern for their members and inform them of special measures they had taken to "make life easier during this difficult time."

CUs make it through first week since hurricane hit

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FARMERS BRANCH, Texas (9/22/08)--Credit unions made it through their first week of the aftermath from Hurricane Ike's devastating hit to the region on Sept. 13. While many were finally getting enough power to operate, many are not fully operationsl. Meanwhile, others were rallying support. Roughly 12 of the 177 credit unions affected by Hurricane Ike last weekend were not operational, the National Credit Union Administration said last week. In the first week since the National Credit Union Foundation (NCUF) activated a national disaster relief fundraising campaign for credit union survivors, 61 donations totaling nearly $31,000 have been made through, reported NCUF Friday. SchoolsFirst FCU, an $8 billion asset credit union in Santa Ana, Calif., leads these online donors with a $10,000 contribution. So far, 17 organizations have donated a total of over $27,000 through Their average donation is nearly $1,600. "What’s also encouraging in the first week of this effort is the number of individual donations," said Steve Bosack, NCUF deputy director. "Already 44 individuals, mainly credit union system employees, have donated a total of over $3,500 through Their average donation is over $80, which is very generous for individual disaster relief donors. "This early outpouring of support is a tribute to the credit union movement’s cooperative spirit," Bosack said. He noted the Texas and Louisiana Credit Union Leagues have done an outstanding job publicizing CUAid to their member credit unions. Once credit unions are able to inform their members about the opportunity to help through CUAid, the full potential of this online disaster relief fundraising platform will be realized, Bosack said. The Texas Credit Union Foundation reported Thursday that it had received about $65,000 in its Disaster Relief Fund, where credit unions inside the state are directing their donations. Texas Credit Union League President/CEO Dick Ensweiler, who will visit the stricken area Wednesday through Friday, was still making appeals to that state's credit unions for assistance. The league has a matchup database in which the hurricane-stricken credit unions with needs can post what they need and are matched up with credit unions offering assistance. Many of the affected credit unions in the area posted messages on their websites, updating members of the status of their branches, urging them to use shared branching, and offering services--such as special loans and deferred payments--to ease members' hardship. And those credit unions still experiencing problems with power and service consistently apologized for the inconvenience and asked for members' patience. Austin-based University FCU said its Galveston branch remains closed. "Deposit and withdrawal services are available at Shared Branches where power has been restored, including AMOCO FCU's Santa Fe and Bay Colony branches," it told members. Accounts were accessible via Internet Banking, phone banking and ATMs. It also offered members special loans and deferred payment up to 90 days on any loans, and provided information to help members with insurance claims. Amoco FCU's Texas City and Bay Colony branches were operating on a limited basis. As of Thursday, the Santa Fe and Bay Colony Branch locations were open with full services except for drive-thru service. The Texas City Branch has no electricition so service is limited. It too noted that online banking and bill pay, ATM, debit cards and credit cards are available. "We are working diligently to fully restore all phone lines and services," it told members. Area West FCU, which has been operating from an alternative site, expected to be back at its location Tuesday. Beacon FCU, whose La Porte and Baytown offices are open, said its Seabrook location still lacked electricity and was closed. Lack of power also affected its ATMs. "We are working to have them restored as soon as possible," it said, directing members to ATMs that were functional at its open branches. "The Beacon FCU family would like to thank all of our members for being patient. We will work through these trying times together, and we hope you and your members are safe." Beaumont Community FCU, which was still closed, according to its website Friday night, was granting 30-day loan extensions for members and noted it was processing transactions daily. It told members it could "send Western Union funds from your accounts at no charge." Due to the power outage in the area, the Brazosport Teachers FCU is still operating at the Travis County CU in Austin. Two branches of Chartway FCU remained closed while the others were functional. Brentwood Baptist Church FCU remained closed. Its website had been suspended during the week. Coastal Community FCU, based in Galveston, remained closed but was communicating via its website to members and urged them to use shared branching services. "We are extending all loan and MasterCard payments for 30 days because we care about you and want to make your lives a little bit easier," it told members. DuPont Goodrich FCU noted its Lumberton, Jasper and Vidor offices are open and others would open as power is restored. "We are answering phone calls; however, the phone lines have been unpredictable. We appreciate your patience if you experience any delays." It warned against leaving messages regarding transactions and suggested contact by e-mail. Education First Employees, which said it was "semi-operational" but closed, used an Intranet to update its employees daily, it said. "Your credit union will start daily activities as power is restored to our area. We hope that all our members remain safe and secure during this period. Your credit union is here to serve your financial needs during this critical time." El Paso Corp. FCU wrote on its website Tuesday it was still closed because its sponsor was closed. It encouraged members to use a shared branch location. First Service CU's website gives an idea of the types of problems the credit unions are coping with. Its note to members said it hoped "that all of you have come through the storm with little or no damage and are on the road to recovery. Certainly we know there are many of you inconvenienced from the storm and our thoughts are with you." As of Friday evening, it was still working from generator power at its main office. "Unfortunately, we have lost our phone lines and do not have an estimate yet when those will be repaired. This means that our Call Center and VIP Phone Line are down, but Home Banking is still up and working. We will keep you posted as to when phone service is restored." First Service said it had decided to shut down its generator at night. "In order to serve the majority of our members during daytime hours, we have decided to shut our generator down from 11 p.m. to 6 a.m. until further notice to preserve the generator. During this downtime, members WILL be able to use ATM and Debit Cards but will not have access to Home Banking or the VIP Phone Line. We apologize for any inconvenience this may cause and appreciate your patience," the credit union said. "We have had power restored to most of our branches but for those offices still without power, we may only be able to offer limited transactions so we apologize for the inconvenience but appreciate your patience during these difficult times," the credit union said. For many credit unions in the area, the message was a typical one.

IBusiness WeekI CUs have become the FI of choice

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NEW YORK (9/22/08)--An article in Business Week notes that credit unions are now the "financial institution of choice" for more people and small businesses. The article by Karen E. Klein in the "Smart Answers" section discusses how small business owners deal with today's financial market crisis. It offers guidance for business owners on banks, credit unions, business loans, labor, pricing, insurance and equity investments ( Sept. 19). "In the past decade, credit unions have become the financial institution of choice for increasing numbers of individuals and small businesses. They're also making more small business loans than ever before," says the article. It features California and Nevada Credit Union League President/CEO Bill Cheney responding to a statement by an expert concerned over losses in the housing market in California and Florida. Cheney noted that "a couple" of credit unions in California had some difficulty due to the housing crisis, "but those have been addressed, and they've merged with healthy financial institutions. "Overall, the great majority [of credit unions] are well-capitalized, in excess of government guidelines on capitalization, and most are doing well considering today's financial situation." Cheney emphasized that credit unions continue to make loans to members who are creditworthy and said they are getting "a lot of calls and interest from our members. They're asking about the availability of their credit lines and about deposit insurance." Cheney encouraged members to call, adding, "they'll likely find that local institutions are doing much better than the larger ones." He pointed out that deposits in credit unions have federal insurance, like bank deposits.

Three nominated for CUNA Board

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WASHINGTON and MADISON, Wis. (9/22/08)--Three people have been nominated so far for the Credit Union National Association (CUNA) board of directors. The deadline for nominations for eight positions on the board is Oct. 17. Nominated are:
* Sandy Lingerfelt, Clinchfield FCU, Erwin, Tenn., for District 3, Class A; * Brett Thompson, Wisconsin Credit Union League, Pewaukee, Wis., for District 4, Class D; and * Winona Nava, Guadalupe CU, Santa Fe, New Mexico, for District 5, Class A.
The eight directors will take office Feb. 27, 2009, for three-year terms to expire at the adjournment of the 2012 CUNA Annual General Meeting. Positions up for election are:
* District 1, Class B; * District 2, Class C; * District 3, Class A; * District 3, Class D; * District 4, Class B; * District 4, Class D; * District 5, Class A; and * District 6, Class C.
Nominators must submit the appropriate forms and obtain consent of the candidate. Voting will begin Oct. 22 and will close on Dec. 19. For more information, use the resource links.

CU System briefs (09/19/2008)

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* WARNER ROBBINS, Ga. (9/22/08)--A man who robbed HEA CU, a $20.7 million asset, Warner Robbins, GA.-based credit union, was given a life prison sentence without parole. George A. Bufkin, 49, was sentenced under Georgia’s “three strikes” law, according to a news release from the local district attorney’s office. Bufkin had four previous convictions for auto theft and a conviction for aggravated stalking. The robbery took place Oct. 12 when Bufkin used a BB gun to demand money from a teller and left with more than $4,000. Because he had been a member of the credit union, employees were able to identify him. Police arrested Bufkin later that day and recovered all the stolen money (The Telegraph Sept. 18) … * HARRISBURG, Pa. (9/22/08)--Heritage Valley FCU, York, Pa., will be featured every Monday talking with the host of FOX43's "Better PA," Melanie Gardner. Better PA is a television program about financial topics. Heritage Valley's presence will promote credit unions, said the Pennsylvania Credit Union Association (Life is a Highway Sept. 19). The segments also will be posted online ... * MADISON, Wis. (9/22/08)--MATC CU announced plans Thursday to merge into UW Credit Union. The two Madison, Wis.-based credit unions will work together to join their institutions and provide current members and the Madison Area Technical College community a full-service branch. According to MATC CU President Rhonda Mork, “We have very similar service philosophies and both have a long history of service to campus communities. This partnership is not only beneficial for current MATC CU members, but an exciting new financial choice for students, faculty, and staff.” MATC CU, with $2.9 million in assets and 650 members, will merge into UW CU, a $1 billion credit union servicing more than 118,000 members, by December … * HARRISBURG, Pa. (9/22/08)--Former Pennsylvania Credit Union Association (PCUA) Chairman Lee Lester Sell, 91, died Aug. 15 at his home. He was chairman of the association from 1970 to 1972 (Life is a Highway Sept. 19). Sell organized 16 credit unions in Pennsylvania and was charter member and founder of Barta-Berks FCU, now RSR Federal. He was Barta's manager for 30 years. He also served on the boards of directors for CUNA Mutual Insurance Society. He was a national director of the Credit Union National Association (CUNA), and was a member of CUNA's task force on consumer affairs and CUNA's Founder's Club ...

Council breakout Handling threats to computer security

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WILLIAMSBURG, Va. (9/22/08)--Credit unions need to focus on internal and external computer security threats and devise a multi-layered mitigation strategy in today’s world, a computer security expert said at a credit union industry conference Friday. A session on how credit unions should handle threats to computer security was presented at the CUNA Operations, Sales & Service Council (OpSS) Friday in Williamsburg, Va. The conference ran through Saturday. Karen Daeke, vice president of security administration at State Employees’ CU, Raleigh, N.C., gave a presentation titled, “Social Engineering Fraud.” According to Daeke, Internal computer security threats include:
* Unauthorized access; * Unauthorized software installation such as adware and spyware; * Unauthorized hardware installation with modems, printers, and portable storage devices; and * Wireless access.
Mitigation strategies to combat unauthorized access include reviewing physical security for computer and network rooms (router, firewalls, hubs), and attempts to control the computer environment (locks, access control, biometrics), Daeke said. To combat unauthorized software, credit unions should password-protect their computers. They also should limit users who have authority to install software, and remove unnecessary ports and drives from computers. Also, there are many free anti-spyware and anti-adware programs available, Daeke said. To minimize threats caused by wireless access points, credit unions should not extend the access range beyond what is needed, Daeke said. External computer security threats include:
* Operating system exploits; * Instant messaging/e-mail exploits * Remote access; * Malware; * Adware and spyware; * Hackers; * Phishing; and * Spam.
Some ways to mitigate external computer security threats include installing firewalls, encrypting instant messaging traffic, installing anti-virus software and not responding to phishers and spammers, Daeke said. Although there is no such thing as an absolutely safe haven from computer system intrusions and threats, the best defense is a multi-layered security system in place, Daeke said. That includes:
* A firewall; * An intrusion detection system; * Anti-virus protection; * Spyware and adware protection; and * Strong passwords and encryption.
And above all, user awareness is needed, she added.

CUNA Mutual CUs in better position to grow

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VANCOUVER, Wash. (9/22/08)--Credit unions may be better positioned for growth than their banking peers nationwide, Dave Colby, chief economist with CUNA Mutual Group, told members of the Washington Credit Union League at its annual meeting last week. Rough times are looming for the U.S. economy and translate to slower growth--not losses--for credit unions, which have a tradition of being fiscally conservative, Colby said (The Columbian Sept. 18). “We have a golden opportunity right now,” Colby told the newspaper. “Your members are being buffeted by the talking news heads, but we know our capital. We can protect it. Financial viability is what credit unions are all about.” Because consumers generally save cash when the stock market is in turmoil, credit unions now have a chance to attract new members to their savings accounts, Colby said. With stressed banks offering unprofitable high-interest savings and certificates of deposit accounts to try to attract much-needed cash, credit unions won’t be able to compete through their rates. Rather, they will have to emphasize their conservative approach with investing and lending to garner customers worried about the health of big banks, Colby said. Credit union assets should grow at a 6.6% annual rate through the next five years, Colby projected. However, to sustain growth, credit unions will need to attract new members, particularly in light of aging members nearing retirement, he added.

OpSS Council Convert to salesservice culture

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WILLIAMSBURG, Va. (9/22/08)--Credit unions converting to a sales and service culture need to “drop the ego,” according to Jim Santiago, vice president of operations at Orlando (Fla.) FCU. “Converting your credit union to a sales and service culture is not about what ‘YOU’ did, it’s about creating what is good for the member, team member and credit union,” he told attendees of the CUNA Operations, Sales and Service (OpSS) Council Conference in Williamsburg, Va., last week. “Leave your ego at the door.” The conference ended Saturday. Credit unions should ensure that their processes don’t offer the member the same product or service every time they walk in. They should offer a combination of products--such as deposit products, convenience products and loan products. Tracking product sales and team member sales by product and service mix is also important, he noted. Providing incentives for credit union employees to see products and services is key. Credit unions should provide product education and information sheets, evaluate and update procedures, train and coach staff. Santiago encouraged credit unions to bridge the gap between the internal service of a credit union--the front and back offices--with external service. Branch managers also should monitor sales daily or weekly, and remember that development coaching is not process coaching. Santiago also suggested that credit unions review and change incentive plans, and recognize staff members’ accomplishments.

TruMark CEO speaks for CUs at state House committee

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HARRISBURG, Pa. (9/22/08)--TruMark Financial CU CEO Rick Stipa before the Pennsylvania House Commerce Committee about a proposal regarding mortgage conciliation meetings.
TruMark Financial CU CEO Rick Stipa testifies during a hearing on a proposal regarding mortgage conciliation meetings. His credit union already participates in such meetings, he said, adding that the proposal should be amended. (Photo provided by the Pennsylvania Credit Union Association)
He testified on behalf of Pennsylvania credit unions and the Pennsylvania Credit Union Association. The proposal would require lenders seeking court approval of a mortgage foreclosure to participate in a conciliation conference with the homeowner to explore restructuring the loan as well as the borrowers’ eligibility for state, federal and local mortgage foreclosure programs (Life is a Highway Sept. 19). Stipa requested that the proposal be amended to clarify the process. TruMark, Trevose, Pa., already participates in conciliation conferences, according to Stipa. “This is the credit union way. This is what credit unions do. We reach out to our members,” he said.

FOX8 Consumer Reports Save money at CUs

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WINSTON-SALEM, N.C. (9/22/08)--Credit unions received positive press on a television station in North Carolina Tuesday. FOX8 consumer reporter Melissa Painter, with the help of Consumer Reports, provided tips for consumers on how to save hundreds of dollars each month. Among the advice: check out a credit union. "Are you still paying bank fees?" Painter asked in the report. "You don't have to. Look at a credit union. Credit unions like Allegacy FCU and Truliant FCU are open to just about anybody, and credit unions have lower rates and almost no fees." Other advice included, comparing insurance costs, buying generic drugs, checking out grocery store brand products, evaluating the phone bill and paying off credit cards. The show aired on Sept. 16. Allegacy FCU and Truliant FCU are both based in Winston-Salem, N.C. Allegacy has $1.123 billion in assets and Truliant has $1.208 billion.

North Carolina CUs shine in credit crisis

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GREENSBORO, N.C. (9/22/08)--North Carolina credit unions continue to help their members weather the economic storm, the North Carolina Credit Union league said Friday.
North Carolina credit unions are doing well despite trouble in the financial markets, and there’s no need for them to cut back on lending, according to North Carolina Credit Union League President/CEO John Radebaugh. (Photo provided by the North Carolina Credit Union League)
Credit unions don’t rely on the stock market for funding, and they made prudent lending decisions when others didn’t. “There’s no need for them to cut back on lending now,” said league President/CEO John Radebaugh. The league also has seen a surge in the number of searches on its credit union locator service, Find a Credit Union. Searches jumped 62% in April through June, the league said (Weekly Update Sept. 19). Statewide, credit unions continue to provide service to their members. The league noted:
* Carolina Postal CU, Charlotte. Loans are up--more than $1.2 million to date. The credit union also offers a “Switch and Ditch” auto loan enabling members to bring their auto loans to the credit union for a lower rate and $50 in gas money; * Champion CU, Canton. Champion offers a Fresh Start Auto Loan to help members refinance their auto loans to a lower rate. It also is offering the Stay Warm Fuel Loan program to help members get low-cost loans to heat their homes; * Charlotte Metro CU, Charlotte. The credit union originated 173 mortgages over the past year totaling $29.8 million, a 90% increase from last year; * Coastal FCU, Raleigh. Coastal added more than 5,600 new checking accounts this year, and more than 13,600 new members since January 1. Deposits are up 14%, loans up 20% and its mortgage portfolio is up 12.5%; * Local Government FCU, Raleigh. The credit union has grown by more than 10,000 members this year, and assets increased by 20%. Loans grew by 33%; * Lion’s Share CU, Salisbury. Loan activity surged over the summer and deposits are up; * Members CU, Winston-Salem. The credit union has a 2.22% increase in total assets and 1.23% in net loans over the last year; and * Summit CU, Greensboro. Loan growth is at $9.2 million, home equity loans are more than $7 million, credit card balances are more than$1.2 million, and auto loans are more than $617,000.

Vermont league president blogs from Poland

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WARSAW, Poland (9/22/08)--Joe Bergeron, president of the Association of Vermont Credit Unions, was blogging last week as a participant in a World Council of Credit Unions (WOCCU) engagement program that met in Poland to study the country's cooperatives. Poland has one of the world's fastest-growing, most successful credit union systems. On Thursday, the delegation met and talked with various government officials in Warsaw--Poland’s capital, Bergeron wrote in his daily blog at “Following security checks and entry past armed ceremonial guards, we briefly toured the main area of the [Presidential] Palace and visited with the President’s Chief of Staff and Under Secretary,” Bergeron wrote. “Our discussions tried to compliment the great benefits credit unions provide Polish people and encourage support for favorable laws for them by government.” On Wednesday, the delegation visited a typical storefront branch of Skok Stefczyk Gdansk. “It’s not unlike a five-to-six staff-member branch of a U.S. credit union, with an ATM machine,” Bergeron blogged. “We did learn that because mass transportation is so prevalent in Europe, drive-up tellers and ATMs are extremely rare.” The delegation’s members noticed that anywhere they stood in downtown Gdansk, they were surrounded by three, four or more financial institution branches. “Again, this being a cash society, makes accessibility to branches more desirable,” Bergeron explained. He also noted that, in rural areas, it’s not unusual for mail carriers to deliver cash to people’s mail boxes. “Oddly, between these mail men delivering cash and people walking around with so much cash on the street, there’s not much in the way of theft. Stefczyk’s 300 or so branches have only experienced two attempted thefts over about a five-year period,” Bergeron added.

Donations pour in Texas takes stock of Ike damages

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FARMERS BRANCH, Texas (9/19/08)--Houston area credit unions are still assessing damages, credit unions are donating funds for disaster relief, those in the ATM industry are reporting their business continuity plans worked, and all are anxious for the power and utilities knocked out by Hurricane Ike to return to the grid. Of the 177 credit unions affected by Hurricane Ike last weekend, 12 still were not operational at the close of the business day Wednesday, said the National Credit Union Administration (NCUA). The Texas Credit Union Foundation (TCUF) reported Thursday that to date, it had received about $65,000 in its Disaster Relief Fund. Of that amount, $25,000 was donated Wednesday by Southwest Corporate FCU, which is headquartered in Plano, Texas. "We are proud to be part of this caring and supportive credit union community, and we hope and pray for a quick recovery for everyone affected," said Southwest Corporate President/CEO John Cassidy. The amounts collected do not include pledges, which are expected to flow in the next several days, said TCUF. Already TCUF has issued more than $32,000 in grants to credit union employees in the affected area to help begin rebuilding. Texas Credit Union League President/CEO Dick Ensweiler and a small contingency of the league team will visit the affected areas next Wednesday through Friday, said the league. "It is through the commitment and dedication of credit union employees and volunteers that the majority of the 180 credit unions in the affected area are at least partially--if not fully--operational today, less than one week after Hurricane Ike ravaged numerous communities in Southeast Texas," Ensweiler said Thursday. "They have put their personal hardships aside so that they can be there for their members, who themselves have suffered great losses. Now it's our turn--we must be there for them in this time of great need," he said. The league posted a video message from Ensweiler on its website at Jill Pharr, executive director of the foundation, noted donations increase by the hour, but so do the requests for emergency grants. "As more and more people are finally able to return to their homes and assess the damage, we anticipate a much greater need for emergency grants," Pharr said. Credit unions in Texas can donate directly to the TCUF Disaster Relief Fund. Those in other states can donate through the National Credit Union Foundation's CUAid. See the link for details. Two Houston-based electronic funds transfer networks--Pulse and Cardtronics--said they experienced little disruption in business operations from Ike, thanks largely to their business continuity plans (ATM & Debit News Sept. 18). Their plans included transferring key operations and personnel to cities further inland. Cardtronics moved its key operations and personnel to Dallas and Portland, Ore. Its Houston headquarters was not damaged and the company planned to move back to Houston this week. Pulse, which processes transactions for 4,500 banks and credit unions, switched its processing to its Dallas facility. The company did not know whether its leased facility in Houston was damaged. The hurricane disabled 327 ATMs owned and operated by Cardtronics in the Houston and Galveston areas. The machines were down largely due to electrical outages and downed communications lines. The company expects the ATMs to return to service soon. According to a league update Thursday morning, all of downtown Houston and areas harder hit on the east side of Houston, such as LaPorte, Pasadena, Baytown and Galveston, likely will see power restored sometime after Sept. 22. "Some areas are so significantly hit that power restoration to existing structures may still be several weeks off," said Rick Grady, vice president of marketing, public relations and communications at the league. Entergy, which supplies electricity to the eastern part of the state, indicated that restoration would be near completion by Oct. 6. However, the Bolivar Peninsula, Sabine Pass, and portions of Port Arthur are still flooded and there is not estimation on completion time for those locations, Grady said.

ICNNI IForbesI on CUs Grab them while you can

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ATLANTA (9/19/08)--"If there's a calm in the economic storm, it may be credit unions, whose investors are sleeping through the night," reported Susan Lisovicz of CNN Thursday during an interview with Neil Weinberg, senior editor of Forbes Magazine. "We've had mergers and bailouts and a lot of us are nervous. Tell us why we should take a second look or in some instances a first look at credit unions," asked Lisovicz, amid banner headlines that said, "Credit unions weather rough seas." Weinberg's answer focused on two reasons why "credit unions are a safe harbor":
* Credit unions are operated as a "stable and profitable business, taking deposits from you and me through our savings and checking accounts, and lending out money for car loans, which earns a spread that is profitable." * Most credit union accounts are federally insured by the government up to $100,000.
"They tend to be conservatively managed and federally insured, which in this day and age is what you want," advised Weinberg. He explained that through lobbying in Washington, credit unions have "managed to open the doors of membership quite a bit" and in many cases a person related to someone in an affinity group can join a credit union. "You want to jump on board," Weinberg advised. When asked what is it about credit unions that doesn't lead to the same kind of forecast for other commercial institutions, Weinberg said credit unions haven't got into the same trouble as commercial banks that specialized in mortgages and made risky home loans. "Typically, credit unions have federal charters and federal inspectors, with strict, tougher rules. Because they began as agricultural cooperatives, they are run conservatively. You want to go for those credit unions." "I got the message," said the Lisovicz. "You want to go for a credit union. Grab them while you can."

New OpSS Council exec committee named

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MADISON, Wis. (9/19/08)--The CUNA Operations, Sales, and Service (OpSS) Council executive committee and officers were announced during the council’s 11th annual conference, taking place this week in Williamsburg, Va. The conference runs through Saturday. Carolyn Jordan, senior vice president of Neighborhood CU, Dallas, moved to chair from vice chair. She replaces Keith Kauffeld, vice president of operations for Air Academy FCU in Colorado Springs, Colo. Kauffeld reached his term limit for chair but will remain on the executive committee. Jennifer Lehn, executive vice president of Numerica CU, Spokane, Wash., was named the new vice chair. Chris Lamb, executive vice president and chief operating officer for E1 Financial CU, Monterey Park, Calif., is the secretary/treasurer. During recent elections, incumbent Sue Douglas, senior vice president and chief operations officer for State Employees’ CU, Raleigh, N.C., and newcomer Debbie Baumann, vice president of operations for Mazuma CU, Kansas City, Mo., were voted onto the committee. Baumann will replace Brenda Dunbar, branch manager for CEFCU in Peoria, Ill., who reached the term limit. Lucy Ito, vice president of research, communications, and public affairs for the California and Nevada Credit Union League, is the new league representative. She succeeds Bob Gallman, senior vice president and chief operations officer for the Texas Credit Union League. Rounding out the executive committee are: Patti Dixon, vice president of service centers for Baxter CU, Vernon Hills, Ill., and Mike Fanelli, chief financial officer and chief operations officer for Atlantic FCU, Kenilworth, N.J.

PCUA Despite market CUs still thrive

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HARRISBURG, Pa. (9/19/08)--Despite the turbulent times in the financial market, credit unions continue to provide a safe haven for consumers' savings or for borrowing through personal, student, car or mortgage loans, says the Pennsylvania Credit Union Association (PCUA). "We understand there is confusion in the financial markets, [with] conflicting news reports, and it is very difficult for consumers to make sense of the turmoil," said PCUA President/CEO Jim McCormack in a press release. "Yet at the same time, consumers should know that their local credit union is a safe place for their money and for loans," he added. PCUA said that in a non-scientific poll of credit union leaders, virtually all report increased inflows of consumer deposits and a strong demand for consumer loans. The credit unions reiterated they haven't been adversely affected by the mortgage market problems and continue to have funds available to make prudent loans to creditworthy borrowers. "Pennsylvania credit unions have not engaged in the risky lending practices like many other players in the financial marketplace," said Diana Roberts, PCUA chair and CEO of Hershey FCU. "Therefore, we as credit unions have no need to tighten our lending policies since we have always been lending prudently." PCUA noted credit unions in Pennsylvania are federally insured and that the state's credit unions are extremely well-capitalized at 11.7%, compared with the federal regulatory requirement of 7%.

OpSS Advancing sales effectiveness

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WILLIAMSBURG, Va. (9/19/08)--Credit unions looking to advance the effectiveness of their sales should retain and focus on 5% of the “right” members to generate substantial revenue increases, according to a CUNA Operations, Sales and Service (OpSS) Council presentation at the OpSS Council Conference in Williamsburg, Va. The conference started Thursday and continues through Saturday. During her presentation, “Advancing the Sales Effectiveness of Your Credit Union,” Angela Prestil, director of sales culture development, Creating Member Loyalty programs at the Credit Union National Association, said credit unions need to know that creating a “value experience” for the right members requires proactivity at the front line and back office, and that consistent and proactive sales management drives results and continuous improvement. Credit unions should know that staff and managers have limited time, which requires effective planning for high-gain activities. Consistent and proactive sales management drives results and continuous improvement. About 60% of credit unions don’t know what their members’ needs are. As a result, members won’t know about or use the credit union’s products. They will migrate to another provider, Prestil said. The “top” 20% of members account for 100% to 200% of credit unions’ profits. The rest have a neutral or negative impact. Credit unions should move top members from a “satisfied” position to a “loyal” position to generate revenue, she said. Other critical success factors to enhancing sales effectiveness are relationship management, sales management and organizational alignment. Relationship management involves getting members to use products instead of buy them, and retaining members instead of just selling to them. More attention should be placed on a member’s financial situation, instead of the product or service. This can be tough, because sales managers often have to spend time on non-sales activities. “Sales managers seldom perform the activities that will ensure a strong sales culture,” she said. “Sales managers understand their role but are prevented from doing it. Organizational discipline and support for managers is essential.” To realign branch manager activities, credit unions should:
* Delegate operations and administrative duties to assistant managers; * Centralize lending--manager no longer needs to approve loans; * Eliminate reports and meetings that don’t add value; * Add a new position dedicated to sales management and coaching; and * Offer coaching for managers by senior managers.

OpSS Council Generating deposits through checking

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WILLIAMSBURG, Va. (9/19/08)--Credit unions need to focus on using checking accounts effectively as a springboard for additional product sales, an industry expert said at a conference this week. A session on how credit unions can generate deposits was presented at the CUNA Operations, Sales & Service Council (OpSS) Thursday in Williamsburg, Va. The conference runs through Sunday. Tim Spenny, strategic advisor at Raddon Financial Group, Oak Brook, Ill., gave a presentation titled “Generating Deposits: New Tactics for Success.” Dollar volume in checking deposits has declined from 2006 through 2008, while in the same period, savings/money market account dollar volume has grown at a 5.1% annual rate, and certificates of deposit dollar volume has grown at a 3.5% annual rate, Spenny indicated. From December 2006 to December 2007, the annual growth rate for U.S. credit union deposits was 8%, compared with 5.1% for banks. The growth rate for loans in the same period was 7.5% for credit unions, compared with 6.5% for banks. Higher expense has caused 43% of people surveyed to save less, while 45 % said higher expense has had no impact on savings, according to the Raddon Financial Group Semiannual Survey. Many financial institutions use promotional gifts to encourage people to open accounts, Spenny said. According to the Raddon survey:
* 39% of those surveyed said the promotional gift made no difference; * 38% said it was a big influence; and * 23% said it played a small role.
Spenny gave examples of what financial institutions do to encourage deposits. Washington Mutual pays a best rate for an online savings account when a checking account is opened. CitiBank offers a high interest-rate account that can be opened only online. It is linked to a checking account. To get the best rate, a customer must pay at least two bills online each month. The development of a checking menu requires eliminating many of the benefits often associated with free checking, Spenny said, such as: free checks, interest, surcharge rebates, debit rewards and foreign ATM waivers. An example of a checking menu is:
* Free checking: No minimums or fees. No fee waivers or other benefits; * Interest checking: Pays nominal interest for a minimum balance; * High-interest checking: Pay the best rate for a high minimum balance (e.g., $25,000); * Relationship checking: Offers benefits based on a full member relationship; and * Green checking: Pays interest, rebates ATM surcharges, and forgives one non-sufficient funds fee for debit card usage, online banking and e-statement.
Build-to-order checking allows customers to, for example, build an account selecting two premium features from a menu of items. When asked to assess their interest in the “build your own checking concept,” 17% of survey respondents said they were extremely interested; 29% said they were very interested, 34 % were somewhat interested; 11% were not very interested; and 9% were not at all interested. Sixty percent said they would not pay for additional features. Spenny listed the following checking conclusions:
* Checking continues to be the main focal point for growth; * Financial institutions are not using checking effectively as a springboard for additional product sales; * With checking strategy one account type is not enough, but don’t go overboard; * Premiums are being offered--cash is king; make sure the premium rewards account activity; and * The newest development is “build your own account.”

CEO hunkered down at CU during Ike

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BEAUMONT, Texas (9/19/08)--On the night of Friday, Sept. 12, MobilOil FCU president/CEO Kim Heinze took air mattresses, her two sons--ages 16 and 20--and stayed at MobilOil’s headquarters in Beaumont, Texas, when Hurricane Ike made landfall in the Houston area early Saturday morning. The headquarters building was built in 2004 and survived Hurricane Rita in September 2005. “I knew how much steel was in it,” Heinze told News Now. “I felt perfectly safe riding this one out here.” Heinze lives in Bridge City, which was one of the areas most affected by the storm. Her home was flooded. She is currently renting an apartment near the credit union. While riding out the hurricane at the headquarters building, Heinze and her sons watched the power go out at 12:45 a.m. Saturday. The credit union’s natural-gas powered generator, which the board agreed to buy two years ago, powered up immediately. “It never skipped a beat,” Heinze recalled. The generator powers the credit union's immediate operations--the security, drive-up teller, ATMs onsite, cash dispensers, outlets in the call center, accounting and information technology areas--even the refrigerators in the break rooms, she said. However, the credit union does not power everything--such as air conditioning. “We’re hoping the power will go back on this week,” she said. “I’ve seen what a benefit [the generator] was,” Heinze added. “Our web, online banking, core data processing and phones never went down.” The credit union never lost water or sewer, and there weren’t any broken windows, she said. The credit union reopened on Monday. Mobiloil has six branches--and its Jasper branch, located about 60 miles north of Beaumont, has been running at full-service. The Treadway and Delaware branches opened Tuesday. About half of Mobiloil’s staff is back to work. Employees had “all sorts of flooding,” Heinze said. They lost cars, had flooded homes, and one employee on the coast completely lost a home. Two of the credit union’s ATMs also were affected by the storm. One was completely submerged in water, she said. Mobiloil has conducted a “huge amount” of transactions through Shared Branching with Credit Union Service Centers, she said. It also has helped other credit unions in the area perform transactions. Members have been arriving at the credit union and thanking staff for service. The marketing team has been interviewing them about the status of their homes as they came in, Heinze said. The credit union also helped local businesses through the ordeal. On Sunday, Heinze went to a CVS pharmacy two blocks from the credit union’s headquarters after Ike hit to buy some sodas and snacks for her sons. She wore her Mobiloil nametag, and one of the CVS employees noticed. “He said, ‘You aren’t open, are you? I’m afraid we’re going to have to close our doors because we’re running out of denominations, especially $1 bills,’” she told News Now. Heinze walked back to the credit union and met the branch manager, who told her that the vault would be locked until Monday. However, the credit union’s cash dispensing system was up and running because of the generator. This enabled them to deliver several hundreds of $1 bills to CVS. “They were so thankful,” Heinze said. “They’ve been open ever since.” Mobiloil employees also have been helping each other with things like cutting up downed trees. “Morale is up,” she said. “Everything is going to be fine.” Mobiloil has $242 million in assets.

CSSAgility comes through for CUs in disaster

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MADISON, Wis. (9/19/08)--CUNA Strategic Services provider Agility Recovery Solutions has supported five credit unions recovering from Hurricane Ike, according to Paul Sullivan, vice president and general manager of Agility. Agility provides onsite business recovery and continuity solutions. Solutions include fully operational mobile office and mobile branch units, satellite voice and Internet access, generators, computer hardware and technology pre-configured to meet requirements, 24/7 emergency help desk as well as annual testing simulation packages. Agility provided generators to the credit unions and a fully operational mobile branch, Sullivan told News Now. Agility also visits the credit unions on-site to show them how to hook up the generators. “The look on people’s faces when you show up with capability--it’s all smiles,” Sullivan said. Since the storm hit, some credit unions have received power. Agility has begun picking up generators. At other credit unions, “the generators could be there for a day or up to a week,” Sullivan said. “We’re used to long-term recoveries. This isn’t the first time we’ve [dealt with] hurricanes.” This year, credit unions and other clients have been asking for larger generators. Agility has provided generators to power a meat packing plant, Tracey Wilder, Agility director of technology and sales support, told News Now. Credit unions signing up for Agility’s services receive access to My Agility, which is a password-protected site with information on preparation and recovery from disasters. Agility representatives talk with clients on the phone, taking them through the services they have and what they need to prepare for a potential disaster. Agility also sends out e-alerts and performs customer care calls. “We let them know that we’re thinking of them,” Wilder said. “We’re proactive and reactive of these events.” Agility also can test programs for its members so they know if the disaster plans work. But while Agility can prep its clients for “a lot of things, we can’t prepare them for eventuality,” Sullivan said. “We can’t prepare for that kind of devastation.”

Texas CU kept operations going through Hurricane Ike

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ALVIN, Texas (9/19/08)--Despite losing half its roof Friday night as Hurricane Ike blew through Texas, Chocolate Bayou Community CU maintained all electronic service operations through back-up systems. The $70 million asset, Alvin, Texas-based credit union, was able to run on generator power from Friday night until 3 p.m. Wednesday when power was restored, Gary Davis, Chocolate Bayou CEO, told News Now Thursday. Davis stayed in the credit union office Friday night and weathered the hurricane because the building is a staging area for an emergency response team for a chemical company that leases office space at Chocolate Bayou’s Alvin location. “So I had to be there,” Davis said. “Our disaster recovery plan worked like clockwork,” Davis said. “I sent our information technology people to Dallas last week so they could get us set up. They got us back up and running Monday with all our electronic services switched to back-up service. Nothing stopped processing. “We started serving our members Tuesday,” he added. “As far as I know, we were the only financial institution opened that fast in our area. I know of only one other bank open as of now, and it is located in a Wal-Mart.” On Tuesday, temporary replacement material was used to patch the missing half of the roof at the credit union, Davis said. Several people, upon seeing that Chocolate Bayou was open for business Tuesday, told Davis that they were going to come back and open an account at the credit union because their financial institutions were still closed. “I was somewhat surprised that about 40% of our service requests since the hurricane have been for deposits, not just withdrawals,” Davis said. “I believe a lot of people had payroll checks because they got paid on Friday, right before the hurricane hit.” The credit union’s staff and membership were “very fortunate” to have gotten through the hurricane well, Davis said. “No staff were injured, although some sustained minor damage to their homes and some are still without power,” he said. “Our membership seems to be doing very well.”

Corporates advise Colombian CUs on settlement ops

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MADISON, Wis. (9/19/08)--Members of the newly formed World Council of Credit Unions (WOCCU) Corporate Advisory Group traveled to Colombia last week to assess the credit union movement and current settlement systems there. The visit marked the group's first international exchange since it was established in March.
Click to view larger image Members of the World Council of Credit Unions (WOCCU) Corporate Advisory Group--from left, Steve Schaefer, WOCCU program manager John Elden, Corporate One assistant vice president, systems operations; and Nick Gomez, director, product management--met with SumaRed General Manager Juan Jose Camargo in Bogota, Colombia.
Click to view larger image Hugo Fernando Gomez, left, CoopCentral director of technology in Columbia explains the corporate credit union's settlement system to WesCorp's Nick Gomez. (Photos provided by World Council of Credit Unions)
Seven U.S. corporate credit unions, under the direction of the Association of Corporate Credit Unions (ACCU) Executive Committee, joined WOCCU representatives earlier this year to establish an advisory group for foreign WOCCU Services Group (WSG) offices. The WSG offices are a new model of credit union service organizations. The corporate group assists with providing technical, operational, legal and regulatory expertise to credit unions. WSG offices currently exist in Bolivia, Colombia, Kenya, Mexico and Peru. SumaRed, Colombia's WSG office, offers consulting services and national money transfers to member credit unions. Its money transfer network uses a Web-based system that transfers remittance information among credit unions, but because SumaRed is not a financial institution, it must manually move funds through credit union accounts at a local bank. Though the data exchange process works well, the transfer of funds is not as efficient as it could be, said WOCCU. The delegation to Colombia visited SumaRed, key credit unions in three cities, the corporate credit union and two of the country's credit union regulators to assess the settlement system and provide formal recommendations for automating the process. WOCCU Corporate Advisory Group members on the trip were Nick Gomez, WesCorp director, product management payment systems, San Dimas, Calif.; John Elden, Corporate One assistant vice president, systems operations, Columbus, Ohio; and Steve Schaefer, WOCCU program manager. The trip was especially meaningful for Gomez, who came to the U.S. from Colombia when he was 18 years old. “This was an extraordinary experience for me,” Gomez said. “I left Colombia right out of high school, and even though I have been back a few times through the years, this trip gave me an opportunity to connect with the credit union movement in Colombia for the first time thanks to the initiative from the WOCCU Corporate Advisory Group. “Credit unions are a very dynamic and critical part of the economy there with great commitment from the government to their health and prosperity,” Gomez added. “There is a great opportunity to have an impact affecting the health of credit unions and millions of people there.” Juan Jose Camargo, SumaRed general manager, said the group hopes “the Corporate Network sees the importance of SumaRed to the credit unions of Colombia. The exchange of technical knowledge and perspectives on what services a corporate-type institution in Colombia can offer will truly allow us to position SumaRed as a fundamental source of support for credit unions now and into the future.” Brad Miller, ACCU executive director, highlighted the collaboration between the ACCU and WOCCU as a way to leverage the Corporate Network's operational and technical expertise and help strengthen the global cooperative financial system. “This first combined effort to evaluate, design and implement a settlement system for credit unions in Colombia is an important step in improving operating methods,” Miller said. “Creating an efficient transaction processing system [in Colombia] could potentially be replicated with credit unions around the globe.” U.S. corporate credit unions involved with the WOCCU Corporate Advisory Group are: Corporate One, Columbus, Ohio; First Carolina Corporate CU, Greensboro, N.C.; Mid-Atlantic Corporate FCU, Middletown, Pa.; Southwest Corporate FCU, Plano, Texas; TriCorp FCU, Portland, Maine; U.S. Central, Lenexa, Kan.; and WesCorp, San Dimas, Calif.

Polands president optimistic about CUs future

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WARSAW (9/19/08)--Facing potentially damaging legislation before Poland's Parliament, the country's credit union movement has been bolstered by support from many of the Baltic nation's legislators and the office of Polish President Lech Kaczynski, who remains "optimistic" about the movement's future.
Click to view larger imageWorld Council of Credit Unions' WOCCU Poland Engagement Program participants pose in front the presidential palace in Warsaw. (Photos provided by the World Council of Credit Unions)
During three separate events this week, members of a World Council of Credit Unions (WOCCU) delegation to Poland met with a dozen Polish lawmakers, including Piotr Kownacki, head of the Chancellery of the President of the Republic of Poland, the country's equivalent of the U.S. presidential chief of staff. In June, pro-banking groups introduced amendments that seek to change Poland's credit union law, passed in 1995 at the rebirth of the Polish credit union movement. Among other issues, the amendments would end all lifetime membership provisions, requiring members to leave their credit unions if they no longer work for employers in the credit unions' field of membership. The amendments also would limit credit unions' access to certain funding sources and reduce credit union oversight authority by the National Association of Cooperative Savings and Credit Unions (NACSCU), one of WOCCU's member organizations. "The new regulations will have a devastating impact on Poland's credit unions if passed," said Grzegorz Bierecki, NACSCU president and WOCCU treasurer, during Thursday's meeting with Kownacki and the delegation in Warsaw's presidential palace. "These laws place important limitations on the member, who will be asked to leave his credit union and pay back all his loans. Essentially, the member will be punished by these laws," he said.
Click to view larger imageBill Cheney (left), president/CEO of the California and Nevada Credit Union Leagues, explains the power of credit unions to Piotr Kownacki, head of the Chancellery of the President of the Republic of Poland (right), while Andrzej Duda, Poland's undersecretary of state (center), looks on.
WOCCU delegation members shared their concerns and U.S. credit union examples with both Kownacki and Andrzej Duda, Poland's undersecretary of state, during the hour-long meeting. Mike Mercer, president of Georgia Credit Union Affiliates (GCUA), explained that recent limitations on consumer lending by U.S. banks in the wake of the subprime mortgage crisis have made U.S. credit unions an even more critical resource during the current economic downturn. GCUA works with NACSCU through WOCCU's International Partnerships program. "A credit union system, if it's healthy, can provide strong and vibrant support in troubling times," Mercer told the group. "All of us thought the situation here critical enough to come all the way to Poland to support our international colleagues." The President of Poland's office attempted to submit more favorable legislation, but it wasn't supported and didn't survive, said Kownacki. If the Polish Parliament passes legislation damaging to credit unions, President Kaczynski must sign the legislation into law, an obligation that allows him to make adjustments he feels are more appropriate to the movement, Kownacki added. "I do agree the current draft goes too far, and I don't believe it will be passed into law," Kownacki said. "I can be quite optimistic on behalf of Polish credit unions, and I believe this group's visit has been very important." Parliamentary discussions about the legislation came to a halt earlier this month when the President submitted alternative amendments. The Polish movement expects as much as a year of discussion and no definitive action before mid-2009. However, support from the President's office and the chief executive's veto power has made Poland's 67 credit unions optimistic about the future. "The 1.8 million ordinary people [and credit union members] interested in keeping and developing the credit union system is the most important strength of that system," Kownacki added. "I think it will be impossible to destroy credit unions in Poland." The WOCCU delegation, led by Brian Branch, WOCCU executive vice president and chief operating officer, includes Mercer; Joe Bergeron, president of the Association of Vermont Credit Unions; Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues; Barry Jolette, CEO of San Mateo CU in Redwood City, Calif., and WOCCU first vice chairman; Jim McCormack, president of the Pennsylvania Credit Union Association; Mike Schenk, vice president of economics and statistics for the Credit Union National Association; and WOCCU staff.

Membership Growth Series Quincy CU

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QUINCY, Mass. (9/19/08)--By “embedding itself” in the area it serves to create community awareness, and by focusing on select employee groups (SEGs) and the youth market, Quincy CU (QCU) is experiencing strong membership growth. The $290 million asset, Quincy, Mass.-based credit union experienced 7.1% membership growth from 2006 to 2007. QCU is a community credit union that serves members and their families who live or work in Norfolk and Plymouth counties, and the town of Dorchester, Mass. This is the 10th installment of News Now's Membership Growth series of interviews with fast-growing-membership credit unions. The series is part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. The series focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA's Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. In 2006, QCU merged with Braintree (Mass.) Educator’s and Municipal Employees CU that had about 800 members. However, that was just a small part of QCU’s membership growth. QCU had 23,329 members as of Aug. 31, Judy Brazil, QCU vice president of marketing, told News Now. “One of the major ways we promote QCU, in addition to the traditional print advertisement channels like radio, print and statement inserts, is to make community awareness a priority,” Brazil said. “We work with people in the area to position QCU to help with community events. We’re very visible in the community.” As an example, Brazil is on the board of the Quincy School Community Partnership organization, working with the public school system on its various issues. QCU has a good relationship with the city of Quincy and city public schools, stemming in part from the fact that until 2005, the credit union was Quincy Municipal CU, serving city employees, Brazil said. Another example of community involvement is the Quincy public schools backpack initiative in which QCU collaborated with local businesses to stuff 400 backpacks with school supplies for elementary school students. QCU paid for the backpacks and delivered them, while other businesses donated the school supplies in the backpacks. SEG awareness is another key component to QCU’s membership growth, Brazil said. “Right now we are focusing on local SEGs such as the Quincy Medical Center and the local ambulance service, so we can offer credit union membership and benefits to their employees,” she said. “We’ve hired a part-time business development specialist to help with SEGs.” QCU tries to raise awareness with SEGs by adhering to its tenet of visibility in the community. By becoming involved in events such as a cancer benefit walk, or having credit union staff visit a local homeless shelter to prepare holiday baskets, QCU tries to “go beyond just writing a check” in its support of the community, Brazil explained. “This helps our membership grow because people see us around town,” she added. “We do have a very loyal membership base and a strong word-of-mouth recommendation that helps our growth.” Youth is another major membership segment on which QCU focuses. Over the past year-and-a half, the credit union has developed two youth programs. Student Advantage targets youth ages 15-25 to help them manage money and credit to become fiscally responsible adults. The program contains a component of financial literacy, utilizing printed booklets and an online site--the Credit Union National Association’s Googolplex. QCU also introduced a First-Time Auto Buyers Program geared to help first-time buyers--namely students--learn about auto financing. Participants have to pass a quiz to show that they understand what an auto loan entails. “We also visit schools in our area to give presentations on financial literacy,” Brazil said. “We teach students how to write checks and how to handle credit cards. They always want to talk about credit cards.” QCU became a community charter in 2005 because it reasoned that to obtain new members and to sustain growth, it had to remove the restrictions of its old charter, which limited membership to only municipal workers and their families in the city of Quincy. “We realized we needed to take steps to make the charter-change happen,” Brazil said. QCU plans to open its first branch in Weymouth, Mass., in 2009. “There is significant potential to grow the credit union’s presence and to realize membership growth,” Brazil said. To contact the CUNA Membership Growth Task Force, e-mail its account at

SACU deploys mobile ATM to assist Houston

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SAN ANTONIO, Texas (9/19/08)--San Antonio FCU (SACU) has set up a mobile ATM at its Fallbrook Branch in Houston, Texas, to help get its members and other residents affected by Hurricane Ike access to their money.
Click to view larger image After Hurricane Ike, San Antonio FCU (SACU) sent its Mobile ATM to Houston Fallbrook Branch to assist members and others with access to their accounts. (Photo provided by San Antonio FCU)
"Utilities are being restored in parts of town, but the traditional ATMs are not back on line at this time,” SACU Senior Vice President Chuck Smith said. “Our credit union wants to make every effort to help out in this crisis. The mobile ATM is a perfect way to bridge the gap until services are restored. Because credit and debit cards aren’t working in many places, having access to cash is essential.” The SACU Fallbrook Branch will reopen as soon as it can, and the ATM will remain in place as long as it is needed, the $2.6 billion asset credit union said.

Texas league to send staff to disaster area soon

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FARMERS BRANCH, Texas (9/18/08)--Several members of the Texas Credit Union League (TCUL) team will begin visiting the areas affected by Hurricane Ike soon, said the league. "In the next day or so, we will build a plan on how to support our members and their membership and when we would begin venturing into the area without getting in the way," said Rick Grady, league vice president--marketing, public relations, and communications. Some league staff already live in the hurricane disaster area. League President/CEO Dick Ensweiler sent a message again to Texas credit unions Wednesday asking them to "open their heart" to help their colleagues (Use the link). As of Wednesday morning, more than 1.8 million customers were still without power while 825,000 customers have been restored to power, reported the three power utilities servicing the affected areas. The league also asked credit unions in the area to update their condition status. It uses the information to populate public sites and assist credit unions' members in gaining accurate information on credit union operations and the needs at specific locations. Use the resource links for more information.

CUs generators in disaster area depend on fuel

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FARMERS BRANCH, Texas (9/18/08)--Many credit unions' disaster recovery and business continuity plans involve relying on generators as an alternative power source. Generators run on fuel. And fuel doesn't get pumped without electricity. What happens if, like in Texas in the wake of Hurricane Ike, a huge power grid is down? "Without power other portions of the energy infrastructure are shut down, including reliable phone service and data lines, and Internet routers and hubs, and important services like gas stations, grocery stores, refineries, and all the other things we may take for granted," said Rick Grady, Texas Credit Union League, vice president of marketing, public relations and communications. "Thus, even though our members can operate their credit unions on generators, the generators need diesel fuel to operate," Grady said in an update on the status of credit unions Wednesday. "That fuel comes from jobbers who stop by the facility to fill the tank, or by individuals going to a gas station and filling a tank. Many of those jobbers and stations cannot pump fuel because their pumps operate on electricity," he said. "The same is true for running water, transportation systems, and elevators in high-rise buildings. So, we have a ways to go before the infrastructure stabilizes," Grady said. Near the Texas/Louisiana border, Hurricane Ike knocked down more than 100 transmission towers, damaged 272 substations and flooded the Sabine Power Station in Bridge City, driving snakes and animals into the plant, officials at Entergy Texas said (The New York Times Sept. 17). Around Houston, most high-voltage lines were intact. The main damage was to distribution lines in neighborhoods, said CenterPoint, another power company. On Tuesday, about 24 high voltage transmission lines --five of them running into Galveston, were still out of service. Caite Blount, vice president of student lending for Texas Dow Employees CU (TDECU) based in Lake Jackson, told News Now Wednesday afternoon that many credit unions and their branches are open but operating without air conditioning. "They're running generators," she said. "Gas is starting to come back into some parts of the area," she said. "We're starting to see more food and gas."

CU recoveryrepairreplace loans to help Ike victims

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LAKE JACKSON, Texas (9/18/08)--As the damage left behind by Hurricane Ike is felt more with each passing day, credit unions are putting into action services to help their members recover, repair and replace aspects of their lives. Texas Dow Employees CU (TDECU), based in Lake Jackson, Texas, has offered several innovative services to help members who suffered losses and whose budgets were turned upside down by the hurricane. They include:
* A universal Skip-A-Pay program, allowing members to skip a month or two on all loan payments to TDECU. Within the first day of the Skip-A-Pay program being announced on the TDECU website, more than 2,000 members took up the offer to defer their loans--mortgage, car or unsecured. * A special "Recover, Repair, Replace and then Relax Loan" to cover the costs of evacuation, displacement, or recovery for the repair, replacement and rebuilding of their homes and lives. Under its terms, members will not have payments for the first 90 days. Afterwards, repayment terms will be extended for up to 36 months. Members can apply for this loan, which will be offered for a limited time, by visiting their branch or calling TDECU.
“After Hurricane Carla in 1961, TDECU helped families get back on their feet. Losses were huge, but we all got through it together and we’re going to get you through this one, too,” Edward C. Speed, president/CEO of TDECU, told members. “We want our members to feel like they have a trusted partner in the community to count on during this tough time. We were the last banking institution to close and the first one to reopen in Southern Brazoria County and in some of our other markets,” he said. Quickly following the storm’s aftermath, TDECU reopened all its public access branches throughout Southeast Texas. All are operating under normal business hours. The openings were made possible through the dedication of TDECU employees to serving their members, said the credit union. No matter where TDECU members evacuated to, they still have had access to 24-hour phone banking services and their funds via the TDECU website at or by calling its Emergency Hurricane Number at 800- 839-1154. TDECU’s commitment to serving its members has also extended to keeping them informed via a blog on its website that continuously provides updates not only on its own operations but also that of surrounding schools and businesses. The blog found at has become a community lifeline with its posting of school and road closures, member stories, photos and videos. Given the strong positive response by the community to the blog, TDECU has committed to keeping it updated throughout the recovery process. TDECU is also posting videos on YouTube to keep the community and members further informed as part of this public information service.

Staff on the job despite devastation at home

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HOUSTON, Texas (9/18/08)--The dedication of credit union employees to their mission of service to members is no more apparent than in Texas during the aftermath of Hurricane Ike. "Their homes have been wiped out, material possessions lost, futures uncertain, and yet they still muster the strength and courage to report to work every day," said Texas Credit Union League President/CEO Dick Ensweiler, in an appeal to credit unions to assist their colleagues (see resource link). The home of Scarlett Garsea of Neches FCU, Port Neches, was spared. She was lucky, she told the league. A loss of power is nothing compared with the hardships several of her frontline staff are experiencing, she said. Three Neches FCU employees live in Bridge City, which was hit hard by Ike. One is a newlywed starting to build a new life. She and her husband lost everything. At Beaumont-based Mobiloil FCU, several employees are in the same predicament, said Ensweiler. CEO Kim Heinze is living in an apartment with no power because her home was flooded by five feet of water. However, Heinze is more concerned about her employees. A number live in Bridge City and their homes are uninhabitable. They've been allowed to enter Bridge City to assess property damages but aren't allowed to stay. Instead, they have taken refuge with family and friends. Of the 100 or so people Mobiloil FCU employes, about one-third of the staff have reported back to work. "If that doesn't illustrate the character of folks we have serving in our movement, I don't know what does," Ensweiler said. Quickly following the storm’s aftermath, Texas Dow Employees CU (TDECU) based in Lake Jackson, reopened all its public access branches throughout Southeast Texas. At TDECU's Angleton branch, three employees located in the Angleton High School branch arrived early after the storm's passage. They cleaned the building and put it into order, then returned home to change clothes. Then they returned to open the branch and welcome members who needed assistance. "This was one of many stories of employees going to extraordinary lengths to get back to their branches to serve members," according to the credit union in a press release. Caite Blount, vice president of student lending with TDECU, is coordinating external communications for the credit union in the aftermath of the storm. Many employees are assessing damages to their own homes. "They range from minor problems, roof repairs, to trees falling on their houses. A couple employees have widespread damage to their homes," Blount told News Now. "Most have no electricity, and yet they arrive here, ready to work. They're just fantastic." There wasn't much chance to settle in. "The moment the credit union opened, the members were there."

Need disaster info Check out these links

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MADISON, Wis. (9/18/08)--To help readers access information relating to disaster recovery with Hurricane Ike, News Now has compiled a list of links for credit unions. For disaster preparedness:
* Disaster Preparedness. Includes pandemic information and a link to the National Credit Union Foundation Disaster Relief Fund. * Texas Credit Union League Disaster Preparation. The Texas Credit Union League is providing its credit unions with information regarding the hurricane. * CU Locate. Credit union members can use this link to find their credit union.
For CUNA Strategic Service providers:
* Strohl Systems/CUNA Strategic Service. Strohl provides credit unions with software tools to assist with disaster preparedness and recovery. * VoiceGard/CUNA Strategic Service. VoiceGard provides telephone continuity and recovery solutions and emergency response service. * Agility Recovery Solutons/CUNA Strategic Service. Agility provides business recovery and continuity solutions for credit unions.
Credit unions looking for assistance:
* CUAid. Individuals can make donations through this website to benefit credit union employees and members affected by the hurricanes. CUAid is a program with the National Credit Union Foundation. One hundred percent of the donations go to help credit union members and employees in need. * CUAid Texas. The Texas Credit Union Foundation set up a separate website for Texas credit unions to donate to CUAid. * CUAid Louisiana. The Louisiana Credit Union League set up a separate website for Louisiana credit unions to donate to CUAid. * National Credit Union Foundation. * Texas Credit Union Foundation. * Louisiana Credit Union Foundation. * Texas Credit Union League list of needed and available resources for credit unions.
* National Credit Union Administration. * Small Business Administration Disaster Assistance. Provides information on how to go about applying for a disaster loan, available disaster assistance programs, and disaster recovery plans. * RESCU--Relief Effort and Support for Credit Unions. The credit union movement's effort to prepare for and respond to large-scale natural and man-made emergencies and business interruptions. * Louisiana Office of Financial Institutions. * Texas Credit Union Department.
Other links include:
* Texas Credit Union League Credit Union Conditions. The league is regularly updating its website with the operational conditions of credit unions in hurricane-affected areas. Also includes alternate locations where some credit unions may be operating. * CUNA Mutual Group. * Texas Credit Union League. * Louisiana Credit Union League.

Survey What consumers want from their FI

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BELLEVUE, Wash. (9/18/08)--More than two in five credit union members and bank customers say they would prefer a change in the environment at their financial institution, according to a survey conducted by Coinstar Inc. in partnership with Kelton Research. Of the survey respondents, 43% said they prefer financial institutions to model their environment after retailers such as high-end coffee shops, and apparel stores known for their top-notch service and personal shoppers (Business Wire Sept. 16). While 33% of the survey respondents don’t want their credit union or bank to know them by name, 67% still prefer that personal touch. Also, 66% of respondents said they would prefer to stand in line for a financial institution teller than for an ATM machine. Other survey results include:
* Nearly half (49%) of account holders say they have at some point dreaded visiting their financial institution; * 72% of financial institution customers would rather make a visit to their branch than the post office; * 76% of financial institution account holders accumulate loose change at home; and * Nearly three-quarters (74%) of financial institution account holders would be likely to use a self-service coin-counting machine at their branch if offered.
Coinstar’s solutions include self-service coin-counting machines.

CU launches e-banking kiosk in Harlem

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NEW YORK (9/18/08)--Lower East Side People’s FCU, New York City, launched a new e-Banking kiosk in the Central Harlem branch. With the kiosk, the credit union will offer ATM, bill pay, check-cashing, phone and gift card services. “The launch of the e-Banking kiosk will support the Harlem community in providing additional access to affordable financial services and financial education,” said Linda Levy, Lower East Side People’s FCU CEO. “[The credit union] is proud to contribute to the economic expansion of Central Harlem and looks forward to serving this community.” Members of Lower East Side and Harlem communities have no credit or poor credit, the credit union said. The credit union serves the Lower East Side of Manhattan. The e-Banking kiosk was provided by Tellagent LLC, PSI Corp.’s exclusive distributor to the credit union industry.

Poland CUs company goes public to fund services

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SOPOT, Poland (9/18/08)--Poland’s credit union trade association has taken an unconventional step to finance ATMs and credit card development programs for its members.
Click to view larger image Grzegorz Bierecki, National Association of Cooperative Savings and Credit Unions (NACSCU) president and World Council of Credit Unions board treasurer, explains NACSCU's publicly traded credit union entity, TF SKOK, to a WOCCU delegation visiting Poland. (Photo provided by the World Council of Credit Unions)
The National Association of Cooperative Savings and Credit Unions (NACSCU) in Poland created the Credit Union Financial Society (TF SKOK), and took the fledgling company public in June. TF SKOK's initial public offering, trading under the ticker symbol SKOK, listed five million shares on the Warsaw Stock Exchange at about 42 cents per share. The first offering sold out quickly, raising US$2.1 million for the NACSCU initiative. Despite being available to the general public, all of the initial shares were purchased by credit union members, according to Grzegorz Bierecki, president of NACSCU and treasurer of World Council of Credit Unions' (WOCCU) board of directors. “We wanted to open up another method to raise capital to support Poland's credit unions,” Bierecki told a WOCCU delegation of U.S. credit union and league executives visiting Poland this week as part of an education and advocacy engagement program. “The shares were very easy to sell.” Funds raised will help support NACSCU's ATM program, which already has 200 units in place serving credit unions across the Baltic country. The monies also will be used to strengthen the country's fledgling transaction card program, a key step in moving Poland from its current status as a cash-based society and opening avenues for other savings and credit products. The Warsaw Stock Exchange follows the same rigor as the New York Stock Exchange, Bierecki said, requiring stringent accounting transparency and accountability of its listed companies. Polish credit unions, as member-owned financial cooperatives, already operate in a transparent fashion, he said, adding despite additional effort and compliance cost of 5% of the funds raised (about $42,000), going public with TF SKOK wasn't a difficult or expensive proposition. “Through the reports we publish on the stock exchange, it’s easy to communicate what credit unions are about to potential investors and members,” Bierecki said. “And we've opened the door to a new type of unrestricted capital that we can use to help underwrite Poland's credit union movement.” NACSCU considered a second offering of five million additional shares this fall, but decided against it due to economic uncertainties around the world, Bierecki said. U.S. league executives participating in the delegation will travel to Warsaw today to advocate against harmful banker-proposed amendments to Poland's credit union law. They admired the steps taken but were skeptical about the success of similar applications in the U.S. “The move took me by surprise, and I'm not sure what to make of it,” said Joe Bergeron, president of the Association of Vermont Credit Unions. “It’s definitely a non-credit union approach, and I'm not sure if that's good or bad. It's certainly an innovative approach.” Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues, agreed: “You have to admire their creativity; however, the pressures in the U.S. of being a publicly held company are tremendous, and I'm not sure the tradeoff would be worth the effort or expense. “However some would say that applying market disciplines to the credit union movement would do it a lot of good,” Cheney added. Joining Bergeron and Cheney on the Poland engagement program led by WOCCU Executive Vice President and Chief Operating Officer Brian Branch, are: Barry Jolette, CEO, San Mateo CU, Redwood City, Calif., and WOCCU first vice chairman; Jim McCormack, president of the Pennsylvania Credit Union Association; Mike Mercer, president of Georgia Credit Union Affiliates; Mike Schenk, vice president of economic and statistics for the Credit Union National Association; and WOCCU staff.

CU System briefs (09/17/2008)

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* MANCHESTER, N.H. (9/18/08)--The New Hampshire Credit Union League hosted its inaugural New Hampshire Credit Union/Make-A-Wish Night at
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the New Hampshire Fisher Cats vs. Connecticut Defenders baseball game recently. More than 4,500 spectators, including 400 credit union employees, friends and families attended. The event raised more than $1,600 for the Make-A-Wish Foundation of New Hampshire. The league's 2009 fundraising goal is $150,000. It has raised more than $1 million for Make-A-Wish in the past 10 years. Pictured are from left: Front row, Wish Children Gabe and Sam. Back row: League Chairman John R. Young; Wish Children Corey and Stephanie; Jason Tremblay, Make-A-Wish Foundation of New Hampshire; and Peter Kavalauskas, president/CEO of Northeast CU and director with the foundation and league. (Photo provided by the New Hampshire Credit Union League) … * URBANA, Ohio (9/18/08)--Grimes CU and Wright-Patt CU have announced they will merge, effective Nov. 1, to better serve current Grimes CU members and the residents of Urbana, Ohio, and Champaign County. Grimes CU's board had approved the proposal and members voted in favor of the merger earlier this month. Grimes' board said the credit union needed to expand its services and product offerings to meet members' growing needs such as expanded hours and additional ATMs. "Wright-Patt also understands that homeownership is one of the primary ways our members can create long-term wealth, and this merger gives us the ability to offer members home loans such as mortgages and home equity loans," said Grimes board President Mary Kay Snyder. Wright-Patt will maintain an office in Urbana, initially at Grimes' current location, but plans to move to a more convenient, member-focused location with an ATM in front of Wal-Mart … * APPLETON, Wis. (9/18/08)--Community First CU based in Appleton has acquired Appleton-based Miller Electric CU (The Post-Crescent Sept. 17). Community First has more than $1 billion in assets. Miller Electric was $22.4 million in assets with 2,954 members, half of whom were employees of Miller Electric Mfg. and their families. The merger will provide access to more services and locations for Miller's members. All 11 of Miller Electric CU's employees were retained, and its single branch is now a Community First location … * PARCHMENT, Mich. (9/18/08)--First Community FCU, based in Parchment, Mich., was a winner of the 2008 American Graphic Design Award for its design announcing the "Tree House Club"--one of three new youth club accounts introducing members 12 and under to the value of saving money and learning responsible money management--and a new mascot, "CASH" the squirrel. First Community graphic designer Cindy Goodison was responsible for the creative direction of the project. The illustration of the mascot "CASH" was outsourced to Ken Davis, a local designer and illustrator. Of the 10,000 entries received, 15% were selected as award recipients … * VALLEY, Ala. (9/18/08)--Counterfeit checks from the Chattahoochee FCU, based in Valley, Ala., have been distributed by United Parcel ServiceS to North Carolina and California. There may more distributed in other areas, according to the Alabama Credit Union League. The checks do not have watermarks. So far, all have written for $3,800 with a check date of Sept. 10. They start with a 774506 check number. The name signed is RE Yarbrough. The account they are written on is closed. The league asked anyone receiving such checks to contact the credit union …

Louisiana activates aid for Ike Gustav survivors

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HARAHAN, La. (9/17/08)--The Louisiana Credit Union Foundation, in partnership with the National Credit Union Foundation (NCUF), has activated the online disaster relief system to raise money for Louisiana credit union people affected by Hurricanes Gustav and Ike. Credit union supporters can now make donations through, a secured website that accepts credit cards and wire transfers. Louisiana credit unions, employees, volunteers, and members can donate online via As donations are posted through, NCUF will coordinate with the Louisiana foundation to distribute money efficiently to those who need it in the affected areas. All donations via will go toward grants. Donations will be forwarded in their entirety to credit union organizations in affected areas through NCUF, which is tax-exempt under Section 501(c)(3) of the US Internal Revenue Code. NCUF does not use any portion of disaster relief donations to pay for the web platform, travel to disaster areas, or any of NCUF’s costs to administer the national disaster relief program for credit unions. “CU Aid is one of many ways our foundation gives back to the credit union movement to thank donors for all their generosity,” explained NCUF Deputy Director Steve Bosack. “We especially want to help our friends in Louisiana recover as quickly as possible.”

Damages far greater widespread says CUNA Mutual

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MADISON, Wis. (9/17/08)--CUNA Mutual Group says that damages to credit unions wrought by Hurricane Ike last weekend are significant. "As expected, damages caused by Hurricane Ike are far greater and more widespread than almost all other Category 2 hurricanes we've seen in recent years," said Phil Tschudy, media relations manager at CUNA Mutual. "Ike's large size has resulted in losses from south of Galveston, Texas, through Louisiana. Although many deal with minor roof, sign and water damage, we are seeing some substantial losses in the Galveston and Houston areas ranging from major roof damage to large flood claims," he told News Now. "We do not have reports of any main credit union locations being totaled. There are, however, a couple of branch facilities that we believe will be total losses," he said. There likely will be more. "Authorities continue to restrict access to some areas, which is hampering our claims inspection teams, although we have been able to get to many of the most severely impacted credit unions," Tschudy said. "Many credit unions remain without power, and some have been unable to inspect their facilities. We expect to see more claims reported over the next several days. As more areas become accessible, our catastrophe adjusters will be visiting all locations reporting major damage," he said. "We strongly encourage affected policyholders that have not yet contacted CUNA Mutual to do so as soon as possible by calling our toll-free disaster hotline, which is answered 24/7, at 800-637-2676," Tschudy added. Texas “will not be normal for several weeks,” said Rick Grady, Texas Credit Union League vice president of marketing and communications. Parts of Texas are without power and will be for several weeks. Because of debris and missing road systems, law enforcement and legal officials have asked evacuees not to return to the area until it is safe, the league said. The Texas league is communicating with its credit unions through its website, onsite visits to affected credit unions and cell phones. The league website is updated regularly with the status of each credit union, and special voicemail and e-mail telephone lines have been installed so that credit union CEOs can report their condition to the league. The Texas league also is using Twitter to get out information and is looking into adding a private messaging service to send text messages to cell phones.

Dozens of CU employees homes were destroyed by Ike

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FARMERS BRANCH, Texas (9/17/08)--The Texas Credit Union League (TCUL) has been contacting every credit union in the area hit by Hurricane Ike last week and has learned that dozens of credit union employees' homes are destroyed. “They've lost everything," said Texas Credit Union Foundation (TCUF) Executive Director Jill Pharr. "Hundreds are facing significant out-of-pocket expenses to repair the damage caused by Hurricane Ike, and still others haven't even been able to return to their homes to assess damage; instead they are relying on the kindness of friends, family members or shelters for the basic necessities," Pharr said. “Countless more have had to deplete their checking and savings accounts just to get themselves and their families out of harm's way, with expenses piling up,” she added. The TCUF is urging the state's credit unions not affected by the hurricane to come to their aid. About 200 credit unions are in the affected area, and over the next several days and weeks, Pharr anticipates the foundation will receive several hundred grant applications. “These are our friends, colleagues and even family members who have been affected. Many are modest-income earners who, despite severe personal losses and emotional trauma, are bravely trying to get back to work while coping with this disaster,” Pharr said. “I'm confident that credit unions all over state will heed this call and come to their aid. We are a direct life line and often one of their first sources of emergency relief.” Credit unions from outside of Texas are encouraged to donate through, the National Credit Union Foundation's (NCUF) online disaster relief platform, said Steve Bosack, NCUF deputy director. The platform directs 100% of donations to disaster relief grants for credit union people. Bosack noted that in the first two business days since NCUF activated the Gulf Coast hurricane relief appeal through, NCUF has received $16,080 in donations and pledges. More information about is available at the resource link. Credit unions in Texas are encouraged by TCUF to donate directly to to the TCUF Disaster Relief Fund, either by mail, 4455 LBJ Freeway, Suite 1100, Farmers Branch TX 75244-5998, or wire to Southwest Corporate FCU, ABA 311990511, Texas Credit Union Foundation, Account # 311900048, Reference: Disaster Relief funds. More information about emergency grants and donations is available at TCUF's website,, on the Disaster tab. TCUL, Credit Union Resources Inc. and TCUF have contributed a total of $30,000 to the Disaster Relief Fund. TCUF has received pledges of donations from leagues and state foundations, as well as credit unions. Credit unions are encouraged to post on their website the CUAid link, This online donation tool can be used by members and credit union employees to make secure online donations to the disaster relief fund. As with credit union donations, 100% of these donations go directly to credit union disaster victims. “I implore our Texas credit unions to open their hearts and contribute to the Foundation's Disaster Relief Fund. Our credit union family needs us and we need to make sure they know they are not alone,” said TCUL CEO Dick Ensweiler.

CU System briefs (09/16/2008)

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* BEMIDJII, Md. (9/17/08)--Members of Bemidjii, Md.-based Headwaters FCU have voted to merge with TruStar FCU, a $116.3 million asset credit union based in International Falls, Minn. The board of the $11.1 million asset Headwaters said a merger would enable members to receive enhanced products and services and would strengthen its financial position (International Falls Daily Journal Sept. 16) … * HARRISBURG, Pa. (9/17/08)--The Pennsylvania Credit Union Foundation has awarded a second-year $10,000 grant to Erie FCU's community partnership for classroom financial education to 7,000 students in 75 schools within 18 school districts of northwest Pennsylvania (Life is a Highway Sept. 16). The funds are part of a $20,000 grant over two years. Financial and administrative contributions from several partners have generated an additional $138,000 to implement the program, said project coordinator Sandi Carangi, vice president of business development for Erie FCU … * PORTLAND, Maine (9/17/08)--Maine's credit unions honored 9/11 victims in their annual People Remembering and Helping People
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ceremony at the 9/11 memorial in Portland on Sept. 11. Also honored were organizations that work to protect Maine People. Checks were presented to the Emergency Food Relief Fund of Maine's five chapters of the American Red Cross. The credit unions also donated to a food pantry in each chapter. A total of $7,055 was donated. In the photo, Diana Dionne (center, holding check) of the Maine Credit Unions' Campaign for Ending Hunger poses with recipients from the Red Cross and food pantries. (Photo provided by the Maine Credit Union League) … * NAPERVILLE, Ill. (9/17/08)--The Illinois Credit Union League has hired Brad Bergmooser as compliance analyst in the Office of General Counsel. He will assume responsibility for preparing analytical reports that will be distributed to ICUL's nearly 400 member credit unions. Previously, Bergmooser served as legislative counsel for Michigan State Sen. Randy Richardville (R-17). He also worked as a deputy campaign manager when Sen. Richardville first ran for the Senate. He is also a former law clerk for the Monroe, Mich.-based Braunlich, Russow and Braunlich, PC law firm … * COTTON PLANT, Ark. (9/17/08)--Bradford Caldwell, a former Campus Credit Union Council executive director, has launched a radio station, KAPW-FM "Power 99," in Cotton Plant, Ark. The station will serve cities in East Arkansas. Caldwell, now president/CEO of Caldwell Media LLC, was in the credit union council position from 1999 to 2002. He is a credit union development educator as well as a third-generation broadcaster … * SAGINAW, Mich. (9/17/08)--Former Bay City News newsman Earl J. Perry, founder of the Bay City Times CU in Saginaw, Mich., died Thursday at his home. He was 93. Perry was the chief operating officer of the credit union and for several yuears after his retirement he continuted to head the credit union from his home. The credit union was eventually incorporated into the Communications Family CU, Saginaw. Communications Family CU has $461.6 million assets (Bay City Times Sept. 15) …

Three CUs get grants for foreclosure relief programs

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CINCINNATI (9/17/08)--The Federal Home Loan Bank (FHLB) of Cincinnati awarded a $200,000 grant Monday for mortgage relief programs in Ohio. The “Preserving American Dream” grant for mortgage counseling and foreclosure mitigation was among seven grants totaling $1.3 million to help distressed homeowners in 44 counties throughout Ohio. The $200,000 in private funding was awarded to seven financial institutions led by Wright-Patt CU, a $1.380 billion asset, Fairborn-based credit union, for homeowners in Montgomery, Greene, Clinton, Darke, Fayette, Miami, Preble and Shelby counties. Other participating credit unions include River Valley CU, a $148.5 million asset, Miamisburg-based credit union; and Universal 1 CU Inc., a $288.4 million asset, Dayton- based credit union. FHLB of Cincinnati President David Hehman announced the grants Monday. “Our members and housing partners told us of the difficulties they had coping with foreclosures in their communities,” he said. “In many cases, the homeowners needed just a few thousand dollars to become current on their mortgages and stay in their homes. We created Preserving the American Dream as one thrust of a larger effort to deal with foreclosures in our district.” “Bringing greater financial opportunities to the residents of the Miami Valley is an important role for Wright-Patt CU,” said Doug Fecher, Wright-Patt president/CEO. “For a lot of people, home ownership is one of the best ways to build personal wealth. Unfortunately many are watching this personal wealth disappear as they struggle to keep their homes,” he added. “This grant will help Dayton area families sustain home ownership and protect their wealth.” The FHLB of Cincinnati has a congressional mandate to devote 10% of its annual profits to the Affordable Housing Program. Through this program, up to $3,500 will be made available to help a homeowner receive foreclosure prevention counseling or benefit from other foreclosure mitigation steps. The funding is made available through FHLB of Cincinnati member financial institutions to qualifying nonprofit housing counseling agencies that provide foreclosure/loss mitigation counseling services in the area.

Status of CUs in immediate disaster area

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FARMERS BRANCH, Texas (9/17/08)--A number of credit unions in the Houston area that closed for Hurricane Ike are now operational, according to the Texas Credit Union League. The league updated its website to reflect the condition of credit unions in the areas affected by the storm. Operational credit unions include:
* Baycel FCU--main office in Bay City open; * Beacon FCU--LaPorte branch will open today. ATMs and debit cards are functional; * Cal-Com FCU; * City of Deer Park FCU; * Coastal Bend PO FCU; * Community Resource CU--open 9 a.m. to 4 p.m.; * DuPont Goodrich FCU--Lumberton and Jasper offices open; * First Community CU of Houston; * Firestone Community FCU--operating from Mauriceville location; * Graphic Arts CU--operating at Kempwood branch; * Gulf Coast Educators CU; * Harris County FCU--located in downtown Houston; * Houston FCU--Sugarland, Rosenberg and drive-thru at Northwest branches open; * Houston Chronicle Employees CU; * Houston Police FCU--open at disaster recovery site. Members should use e-branch, ATMs and shared branching; * Houston TX Firefighters FCU; * Light Commerce CU; * Members Choice CU; * MemberSource CU; * Navy Army FCU; * Neches FCU--CU running off-site in Irving. Port Neches branch scheduled to open today; * People’s Trust FCU--four branches and call center open; * Pioneer Muslim CU; * Port Terminal FCU; * PrimeWay FCU; * Shared Resources CU; * Space City CU; * StarTrust FCU; * Sugar Land Employees CU; * Team Financial FCU; * Texas Bay Area CU; * Union Fidelity FCU; * United Energy CU; * USE CU--operating in downtown federal building; and * Victoria Teachers FCU.
Ike hit the Houston area on Saturday, and many parts of the city are still without power. For more information, use the link.

Texas CUs that are open not affected by Ike

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FARMERS BRANCH, Texas (9/17/08)--The Texas Credit Union League has reported a number of credit unions in the Houston area that are open and unaffected by Hurricane Ike. Ike made landfall in Galveston near Houston Saturday. Parts of the city are still without power, and some evacuees have been told to stay out of the area until it is safe to return. Credit unions that were unaffected by Ike include:
* Amplify FCU; * Angela County Teachers CU; * Angelina Federal Employees CU; * Bayou City FCU; * Brazos Valley Schools CU; * Chocolate Bayou Community FCU; * Cowboy Country FCU; * Cy-Fair FCU; * Doches CU; * Memorial Hermann CU; * Metroplex CU; * NAFT FCU; * Public Employees CU; * Rio Grande Masonic PH FCU; * St. Luke’s Community FCU; * Star of Texas CU; * Texas Association of Prof. CU; * Texas Dow Employees CU * Texasgulf FCU; and * United SA FCU.
The league continues to update its website with the status of Houston area credit unions. For more information, use the link.

Filene launches Legacy Gifts Fund for research

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MADISON, Wis. (9/17/08)--The Filene Research Institute has unveiled a Legacy Gifts Fund to support the long-term research and innovation activities of the credit union community. The fund offers a number of methods for participation:
* Memorials and honorariums: Gifts made in memoriam or in honor of an individual’s career or service; * Gifts through a donor’s will: Testamentary gifts allow a donor to bequest through an estate; * Retirement funds, life insurance, and financial accounts: Naming the Filene Research Institute as a beneficiary to confer gifts outside a will; and * Cash donations: The simplest way to support the institute and fund ongoing programs.
“For two decades, Filene has been a powerful force for the continued development of the cooperative credit union idea,” said Filene Board Chair Patsy Van Ouwerkerk, president/CEO, Travis CU, Vacaville, Calif. “Gifts to the Legacy Gift Fund will help to maintain projects that impact the very future of credit unions, as well as the evolution of new ideas to help us serve our members better.” “Filene research into market and operational issues helps Congress and state legislatures understand the needs of credit union members and the impact of public policies on credit unions,” said Mark Meyer, Filene CEO. “Research also helps credit unions to develop new and better consumer financial services,” he added. “Filene findings assist in adapting to rapidly changing economic, legal and social conditions. The Legacy Gift Fund will secure the future of these important contributions to the movement.” For more information on the fund, contact Lois Belekevich, director of membership, at 608-231-8552 or e-mail to

WOCCU delegation visits Polands largest CU

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GDYNIA, Poland (9/17/08)--SKOK Stefczyka opened its 288th branch Tuesday to serve members who live and work near the Baltic Sea. The grand opening ceremonies put Poland's largest credit union more than halfway to its goal of 500 branches by 2012. Credit union officials say they will need every last one of them to compete effectively in Poland's growing financial market.
Click to view larger image The SKOK Stefcyzka facility in Gdynia, Poland, the credit union's 288th branch, celebrated its grand opening Tuesday with a visiting delegation from the World Council of Credit Unions.
Click to view larger image Sùawomir Michalewski, deputy director of SKOK Stefczyka (right), discusses credit union growth with Mike Schenk, Credit Union National Association vice president of economics and statistics. (Photos provided by the World Council of Credit Unions.)
"There are no checks and very few credit and debit cards in Poland," S³awomir Michalewski, deputy director of SKOK Stefczyka, told a World Council of Credit Unions (WOCCU) delegation visiting Poland as part of a combined education and advocacy program. "This is a cash society and requires many hands." Poland's cash dependency may have resulted from a lack of financial industry development during consecutive decades under the Nazis and Communism. It also poses a challenge for the country's burgeoning credit union movement, which experienced a rebirth with the Solidarity movement's success in 1989. The challenge facing Polish credit unions, SKOK Stefcyzka officials say, is to create an appetite for credit and an appreciation for electronic transaction capabilities among Poland's 38 million citizens. SKOK Stefczyka serves 600,000 members and maintains assets of US$1.1 billion, a profile the credit union has managed to reach within 15 years. Branching strategies play a significant role in its growth. However, the constant member lines in branches across Poland have raised both service and economic concerns for the credit union. "It's nice that [members] spend 40 minutes talking to us, but we have to decide if we are getting sufficient business from those conversations," Michalewski said. "We have to change the behavior of our employees regarding efficiency." Part of that change will be to evolve from a service to sales culture and promote more cost-effective means of serving members that will lead to greater use of credit and more comprehensive services, he added. "We must turn loyalty, which is quite nice, into profitability," Michalewski added. This will be no easy task, according to the credit union's research. More than 50% of members say they choose their financial institution based on proximity, and more than twice that number cite safety and soundness as the key issue. About 18% say an expansive ATM network is important. However, a small percentage of members have debit and credit cards, just 20% have any type of loan, and even fewer members have savings or investment accounts. While SKOK Stefczyka's challenges are distinct to Poland, they also have a familiar ring for credit unions in developed countries worldwide, according to Mike Schenk, Credit Union National Association (CUNA) vice president of economics and statistics and a member of the WOCCU delegation. Increasing competition from foreign banks and a growing economy will force Polish credit unions by necessity to change how they conduct business. "Brick and mortar is still the name of the game in Poland, and that requires lots of branches and lots of people," Schenk said. "That puts lots of pressure on expense ratios." Gaining greater share of wallet from existing members in addition to growing membership totals--something SKOK Stefczyka already has discovered--will be a strategy not only for growth, but for survival of Poland's credit unions, Schenk said. At the same time, the credit unions' ability to increase member satisfaction and back-office efficiencies offer Poland's credit unions advantages that even U.S. credit unions don't have. "In a lot of areas, Poland's credit unions are further along than we are," Schenk added. "It's fascinating to see the differences and resources available from an institutional and societal perspective." The WOCCU delegation includes Schenk; Brian Branch, WOCCU executive vice president and chief operating officer; Joe Bergeron, president of the Association of Vermont Credit Unions; Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues; Barry Jolette, CEO of San Mateo CU, Redwood City, Calif., and WOCCU first vice chairman; Jim McCormack, president of the Pennsylvania Credit Union Association; Mike Mercer, president of Georgia Credit Union Affiliates; and WOCCU staff. On Thursday, the WOCCU delegation travels to Warsaw and, with members of the Polish credit union movement, will advocate on behalf of the country's cooperatives in the face of potentially damaging amendments to Poland's credit union laws.

Iowa CU convention begins today

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DUBUQUE, Iowa (9/17/08)--The annual Iowa Credit Union Convention, themed “Advancing Growth,” will take place in Dubuque today through Friday with more than 500 credit union CEOs, directors, executive staff, guests and vendors in attendance. This year’s theme was chosen to emphasize the role credit unions play for more than 850,000 Iowa residents. “To continue to improve the life of Iowans, credit union growth is critical for the future of our movement,” said Patrick S. Jury, president/CEO of the Iowa Credit Union League. “That’s why we have made it our sole focus for the 2008 convention.” The event starts today. On Thursday, keynote speaker Peter Duffy will discuss ways credit unions can explore the impact of consumer behavior, the evolving economy and regulation on credit union growth and earnings. On Friday, speaker Vince Lombardi Jr. will close the conference with a message about the qualities and commitment found in high-performing people, such as his father, the late football coach Vince Lombardi. Fifteen education sessions will focus on improving the identity of credit unions, the economy, and compliance updates.

CU Growth Solutions GAC nab design awards

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NORTHVILLE TOWNSHIP, Mich. (9/17/08)--CU Growth Solutions, a division of the Michigan Credit Union League’s (MCUL) subsidiary CUcorp, has received three 2008 American Design Awards. The awards are from a large national design competitions and honor work in all forms of media--from print and collateral, to international design and national graphics. CU Growth Solutions earned awards for its work with the Credit Union National Association (CUNA), the Pennsylvania Credit Union Association and the MCUL Education 2008 Midwest Management Conference. CU Growth Solutions, a marketing agency designed to assist credit unions and credit union-related businesses, worked with CUNA on developing the 2008 Government Affairs Conference logo. The American Graphic design awards were granted to 15% of the more than 10,000 entries submitted.

Shared branches serving members of Texas CUs

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MADISON, Wis. (9/16/08)--The shared branching system is working in Texas, with members of credit unions closed by Hurricane Ike getting services through several systems. The National Credit Union Administration (NCUA) has identified 179 credit unions, with combined assets of $12.7 billion and serving 1.7 million members, that were affected by Ike. The hardest hit areas were:
* Galveston, which has five credit unions and 14,237 members; * Beaumont, which has 10 credit unions and 81,999 members; and * Bridge City, which has one credit union and 5,436 members. More than 90% of Bridge City was flooded.
More than 80 credit unions are located in Houston. Many are without power and have been damaged by wind, NCUA said. The NCUA is working with the Texas Credit Union League and the Texas Credit Union Department to help credit unions restore service to members, the agency said. Members have been able to access their accounts through CO-OP Shared Branching, said Craig Beach, senior vice president of marketing business development. “It’s been very successful,” he told News Now. “Members that have evacuated [Houston] have found other locations through the website and by calling us.” Credit unions also are using CURe, which is a disaster recovery solution that allows credit unions to access a second virtual private network connection in the event that their data processor has gone down. “CURe was birthed out of [Hurricanes] Katrina and Rita,” Beach said. Now that disaster recovery solutions such as CURe are in place, “things have gone so much more smoothly,” he said. “Credit unions and the Texas league have worked in concert to make [accessing funds after Ike] smooth for members.” Brian McCue, director of business development, Member Service Centers, said he was on the phone with and texting credit unions all day Monday. Shared Branching has been a “big piece of their disaster recovery plan,” he told News Now. Credit unions on Shared Branching are happy with how much it’s working so far, he added. He also noted the large role text messaging has played in communicating with credit unions. Two weeks ago, before Hurricane Gustav hit, he collected the cell phone numbers for many credit union CEOs and other management. “Text messages are the primary means of communication,” he said. Texas credit unions that have confirmed via website that they are open:
* Amplify FCU, Austin; * Brazos Valley Schools CU, Katy--all branches open except Katy, Kingsland and Rocky Creek and Missouri City; * Chocolate Bayou Community FCU, Alvin; * Cy-Fair FCU, Houston; * DuPont Goodrich FCU, Nederland--Lumberton, Jasper offices open, phone lines down; * First Community CU of Houston, all open except Sugar Land, Champions, Sam Houston, and Echo Lane; * Fivepoint CU, Nederland; * Gulf Coast Educators FCU, Pasadena, Pearland office closed; * Houston TX Fire Fighters FCU, main office drive-thru, north branch and south branch closed; * JSC FCU, Houston--Ellington, Friendswood, Park Place, Bay Colony-Dickenson, Pearland and Monument-13th Street open; * Members Choice CU, Houston--drive-thru open only; * Mobiloil FCU, Beaumont--Delaware and Jasper branches open; * Navy Army FCU, Corpus Christi; * PrimeWay FCU, Houston--Blackhawk, Greenspoint and Med Center branches closed until further notice; * Southwest Financial FCU, Dallas; * St. Luke’s Community FCU, Houston; * Star of Texas CU, Austin; * Texas Dow Employees CU, Lake Jackson--call center open; * Temple-Inland FCU, Temple--drive thru only; * Texasgulf FCU, Wharton; * Transtar FCU, Houston--290 and Williams Tower offices open; * Union Fidelity FCU, Houston--alternate location at Sheetmetal Workers Local 54; and * United SA FCU, San Antonio.
According to CUNA Mutual Group, credit union policyholders with damages can contact the CUNA Mutual Disaster phone number at 800-637-2676, which is answered 24/7.

CUs across nation pledging support for Texas CUs

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DALLAS (9/16/08)--Early status reports from some credit unions in Texas were beginning to arrive Monday, said the Texas Credit Union League, and credit unions from across the nation already were rallying to offer support. "Assessment of the damage in the communities hit by Hurricane Ike is underway," said Linda Webb-Manon, director of communications at the league. "It was a pretty massive hurricane, and 200 or so credit unions are located in the affected area. However, we don't know the extent of the damage to all of these credit unions at this point." "Many have experienced flooding and most have experienced power outages," she said. "But, again, it's too early to tell about the extent of the damage." The league is posting credit unions' status on its website. Monday afternoon the league said that some credit unions have substantial damage while others are operating via their business continuity plans. "I think all of us were glued to our televisions over the weekend, hoping upon hope that Hurricane Ike would spare us the devastation we experienced with Hurricanes Katrina and Rita. Unfortunately, it's pretty apparent that that is not the case," said league President/CEO Dick Ensweiler. "Hurricane Ike has left a trail of destruction, and President Bush has declared 29 Texas counties major disaster areas. Our hearts go out to the millions of displaced families, scattered in shelters across the state, and uncertain of what they will return to. "As disaster recovery efforts get underway, the credit union community too is positioning itself to respond to the needs of our credit unions, and of course their employees, in the affected area," Ensweiler said. He noted that the Texas Credit Union Foundation has activated its Disaster Relief Fund, and has also been activated." The National Credit Union Foundation (NCUF) announced Monday that credit unions were already pledging donations. "On the first business day after NCUF activated an appeal through CUAid, credit union organizations and individuals donated nearly $11,000," Steve Bosack, NCUF's deputy director, told News Now. "All donations through CUAid will be dedicated to Gulf Coast hurricane relief grants," he said. In addition to aid efforts by the Texas Credit Union Foundation and the National Credit Union Foundation, the league is matching credit unions with needs generated by the storm with credit unions in the state who are offering help. Credit unions affected by the hurricanes can list the items they need through filling out a form at on the league’s website. The items will appear on a chart at Credit unions offering resources can go to another page: on the league’s website and submit the items they’re offering.

Positive CU stories in ITheStreet.comI ILA TimesI

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MADISON, Wis. (9/16/08)--Two more and Los Angeles Times--have joined the ranks of those suggesting that consumers try a credit union. In Friday's, an article, "Credit Unions Take on Big Banks," notes that many banks are hiking fees to make up for billions of dollars in losses. "Credit unions, having escaped the financial crisis, are chipping away at their larger rivals' customer base," says the article. "They offer what most consumers need: good rates, low risks and personal service." The article provides a list to consider when switching to a credit union: membership criteria, not-for-profit status, interest rates, fewer options for services and competitive advantages. In Sunday's issue of the Los Angeles Times, Liz Pulliam Weston's "Money Talk" column addresses a question from a reader about paying off student loans with low-interest credit cards. "Is this a smart move for the private loans? If so, how would I find such an offer? (Perhaps through a credit union?)," asks the reader. Pulliam's discussion about card rates includes: "Check your local credit union, because credit unions often offer good rates."

Others cut and run we stayed

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LAKE JACKSON, Texas (9/16/08)--One credit union is serving all of the credit union members and consumers of financial institutions of Brazoria County, Texas--Texas Dow Employees CU (TDECU), according to a video the credit union created and uploaded to YouTube, after Hurricane Ike hit the area this past weekend. The video shows credit union employees working in a TDECU call center in Hallettsville Saturday to serve members affected by Hurricane Ike. No credit union member at TDECU is going without service, said TDECU CEO Ed Speed. “When others cut and run, we stayed,” Speed added. Among the credit union employees working in Hallettsville are staff from Brazoria County, he added.

Illinois REAL Solutions partners explore growth

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NAPERVILLE, Ill. (9/16/08)--Illinois’ REAL Solutions partner credit unions participated in three information-gathering sessions this summer featuring payday lending alternatives, the Volunteer Income Tax Assistance (VITA) Program and asset-building savings accounts, and student outreach. REAL Solutions, a signature program of the National Credit Union Foundation, expanded to Illinois during 2008. “REAL” stands for “Relevant, Effective, Asset-building, Loyalty-producing” Solutions. The program is designed to help credit unions offer services that succeed in serving people of modest means, working families, and "low-wealth" households. The meetings were hosted by the Illinois Credit Union League (ICUL). During the session on payday lending alternatives, the partners gained insight into the world of payday lending and payday loan borrowers. For example, 68% of the borrowers are under age 45, 4% are over age 65, 82% have a high school diploma or better, 52% have some college or a degree, 42% own their own homes; 100% have steady income and an active checking account, 96% are aware of the finance charge, and 92% believe that payday advance is a useful service. The partners heard presentations during the session on the VITA program from the Internal Revenue Service, who sponsors the program; the Center for Economic Progress, a non-profit agency that helps coordinate VITA sites throughout the state; North Side Community FCU in Chicago, which participates in the program; and Joni Senkpeil, ICUL’s director of Small CU Development and a VITA volunteer. Asset building savings accounts was another topic addressed. “Asset building is an anti-poverty strategy that helps low-income people move toward self-sufficiency, a tool to build wealth through appreciating assets such as higher education, vocational training, small business, and home ownership, and a catalyst that creates economic momentum that can help individuals to escape the cycle of poverty permanently,” explained Megan O'Neil, independent asset building consultant. Asset building is typically accomplished through individual development accounts (IDAs). IDAs are special savings accounts for qualified low-income individuals, which offer matching government or foundation funds that help the total grow quickly. To participate, a person must be EITC eligible or have an annual household income less than twice the poverty level (about $40,000 for a family of four), and a net worth of less than $20,000 excluding the value of a residence and one motor vehicle per household. Three credit unions discussed their experiences with operating student-run branches in local high schools at the student outreach meeting. At South Division CU’s high school branch at Brother Rice in Evergreen Park, the credit union has worked since 2002 to create a “center of influence” for students and their finances. It has counseled students about working with money, and establishing and using credit wisely. Credit cards are offered to students based on their grades. Students are treated as adults in the handling of their finances. The student outreach meeting was rounded out by RIA FCU, Rock Island, Ill., which discussed its Kids Are Rewarded for Saving program. The initiative teaches kids up to age 12 the value of saving, and provides rewards and activities to help them reach their goals. RIA also plans to bring “CU4 Reality” to local schools. The event, held as a financial reality fair, puts students through an exercise where they learn about all of the various expenses they could incur in the real world.

Kansas CUs grew in second quarter

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WICHITA, Kan. (9/16/08)--Kansas credit unions added members and grew in asset size in the second quarter, according to a report by the Kansas Department of Credit Unions. Credit union assets rose nearly 12%, while the number of credit union members increased more than 2%, the report said (The Wichita Eagle Sept. 13). Also, credit union loans rose 7%, and shares increased 11%, the report said. However, delinquencies climbed almost 12% during the quarter. The state’s credit unions are well-capitalized and have been able to handle national and global financial services issues, Marla Marsh, CEO of the Kansas Credit Union Association, told the paper.

Louisiana CUs seem to have weathered Ike OK

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HARAHAN, La. (9/16/08)--Despite widespread flooding, Louisiana credit unions seem to have weathered Hurricane Ike fairly well, based on limited preliminary assessments, according to the Louisiana Credit Union League. “I’ve talked to a couple of credit unions in Lake Charles, and it seems like the situation is OK,” Connie Major, league executive vice president, told News Now Monday afternoon. “Electricity is coming back on and ATMs are working. It appears that Ike did more water damage than wind damage here. We have a field person making calls now to credit unions. “It seems like Louisiana weathered the hurricane pretty well and did not sustain as much damage as Houston or Galveston, Texas. The area where the hurricane hit in Louisiana is not highly populated and there are not a lot of credit unions there,” she added. Hurricane Ike flooded more than 200 miles of road and 13,000 buildings in the southern part of Terrebonne Parish, impacting about one fifth of the area residents, according to officials there. Also parts of Cameron, Lafourche and Vermillion counties were heavily flooded when levees were topped or breached (USA Today Sept. 15). On Saturday, the Bush administration declared 14 Louisiana parishes to be major disasters, allowing aid from federal funds and resources, according to the National Credit Union Administration (NCUA). The parishes are: Acadia, Beauregard, Calcasieu, Cameron, Iberia, Jefferson, Jefferson Davis, Lafourche, Plaquemines, Sabine, St. Mary, Terrebonne, Vermilion and Vernon. NCUA’s Region IV Texas and Louisiana staff are accounted for and safe, although some are without power and others cannot return to their homes, NCUA said in a press release.

Georgia CUs donate 34000 to Iowa flood relief

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DES MOINES, Iowa (9/16/08)--Georgia’s credit unions have raised $34,300 for disaster grants for Iowa credit union members impacted by this spring’s floods and tornadoes. After the Georgia Credit Union Foundation issued an appeal, 38 credit unions from across the state made contributions. All funds donated go directly to Iowa credit union members who were displaced from their home for a significant period of time and be disbursed through the Iowa Credit Union Foundation’s Disaster Relief grant program. The foundation has received more than $550,000 for disaster relief, to date. It has issued more than 1,100 grants to Iowa credit union members. Each grant is $500 to help members with short-term cash needs. “These have been trying times for Iowans and it is our hope these funds will provide the needed assistance being offered by Iowa’s credit union community,” said Dan Denning, foundation executive director. “We extend our sincere thoughts and prayers for a speedy rebuilding and recovery process.” “The outpouring of support from credit unions in Georgia and across the country has been overwhelming,” said Marybeth Foster, executive director of the Iowa Foundation. “We could not help as many Iowa credit union members without the financial support we’ve received from the credit union community,” she added.

CUNA Report CU training budgets on the rise

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MADISON, Wis. (9/16/08)--More credit unions have a training budget and the amount of that budget has increased significantly, according to the results of a recently released Credit Union National Association (CUNA) survey.
Click to view larger image Click for larger view
According to the 2008-2009 Staffing and Space Survey, published by CUNA’s center for research and advice, more than 70% of credit unions with $10 million or more in assets have a 2008 training budget, up from 64% in 1999. Among these credit unions, the average 2008 training budget was $46,561--a substantial increase over the average $26,348 budget reported in the 1999 study. “With the prevalence of talent shortages, a credit union’s success could likely depend on how well employees are groomed for management and key positions, making training more important than ever,” said Beth Soltis, senior research analyst for CUNA. "However, some organizations overlook non-management or lower-level positions, and doing so could undermine retention and recruitment efforts," she added. "Credit unions should remember to ensure that training and development opportunities are available to all employees to not only improve efficiency and sharpen skills, but also to uncover leadership traits and discover hidden potential." Many credit unions are ahead of the curve when it comes to staff education, the survey indicated. Training dollars were distributed evenly in 2008, with 35% allocated to management and 36% to non-management employees. The remaining 29% went to train volunteers, the survey said. The Staffing and Space Survey examines key staffing levels for business lending, consumer lending, collections, tellers and service areas. It also analyzes office space issues; training, recruiting, and human resources expenses; telecommuting; and outsourcing. Data was broken down by asset size, region, number of members, number of branch offices, number of full-time equivalents, number of full-time employees, number of part-time employees, and number of services offered. For more information, use the links.

Polish CU System thrives WOCCU told

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SOPOT, Poland (9/16/08)--Credit unions in Poland evolved like financial cooperatives elsewhere in the world, serving members of the country's maritime, mining and other major industries. As those industries changed, the Polish movement broadened its focus and now enjoys even more success.
NACSCU President Grzegorz Bierecki provides an overview of the Polish credit union system to a delegation from the World Council of Credit Unions. (Photos provided by the World Council of Credit Unions)
"Our market has changed as the big dinosaurs of Soviet industry have been downsized," Grzegorz Bierecki, president of the National Association of Cooperative Savings & Credit Unions (NACSCU), told members of a World Council of Credit Unions (WOCCU) engagement program They are visiting the country this week to advocate on the credit unions' behalf before Polish Parliament. Credit unions are now pursuing a wider common bond, which is driving rapid growth. The growth outlined by Bierecki, who is WOCCU's board treasurer, helped the Polish credit union system, called SKOK, grow faster and provide more services than any other movement in recent history. Currently, NACSCU has 62 affiliated credit unions serving 1.8 million members through 1,708 points of service. Consolidated assets in the NACSCU system total US$4.1 billion and continue to grow. Bierecki introduced himself to credit unions in the wake of the Solidarity movement, which helped liberate Poland from the Soviet Union's rule. In helping research financial systems for the newly democratic country, Bierecki found a perfect match in credit unions' one-member, one-vote ideal. In the early 1990s, he visited the U.S. and participated in Capitol Hill visits with members of Georgia Credit Union Affiliates (GCUA), the league that eventually partnered with NACSCU through WOCCU's International Partnerships program. "They were real students of democracy, and we were intrigued with their interest," said Mike Mercer, GCUA president and a participant in this week's advocacy efforts. The Georgia delegation took Bierecki to visit Sen. Sam Nunn (D-Ga.) and Rep. Newt Gingrich (R.-Ga.) during CUNA's Governmental Affairs Conference. The lawmakers were impressed with Bierecki's dedication and encouraged Poland's credit union growth, which to-date has been impressive, Mercer said.
Georgia Credit Union Affiliates President Mike Mercer takes notes during a presentation by NACSCU President Grzegorz Bierecki. GCUA is a partner of the Polish credit union system through the World Council of Credit Unions' International Partnerships program.
"Polish credit union growth rates have been spectacular, so much so that they have been able to assist credit union movements in other countries to the east," Mercer explained. "Polish credit unions are at the front of the cooperative financial movement today. They did it through dedication, conviction and exceptional leadership, because at the time they didn't have much else." The WOCCU delegation will accompany Polish credit unions leaders to Warsaw on Thursday to advocate against amendments to Polish credit union law recently introduced by the banking industry. If enacted, the amendments could severely curtail credit unions' service to members. "I don't think there is much chance that harmful legislation will pass because the Polish credit union movement is too well-connected to the government and the hearts of the Polish people," Mercer said. "However, if the new law does succeed, it would seriously throttle credit unions' abilities to serve the Polish people. It's a serious threat, and one that crops up whenever credit unions succeed." Joining Mercer in advocacy efforts are Joe Bergeron, president of the Association of Vermont Credit Unions; Bill Cheney, president/CEO of the California & Nevada Credit Union Leagues; Barry Jolette, CEO of San Mateo CU, Redwood City, Calif., and WOCCU first vice chairman; Jim McCormack, president of the Pennsylvania Credit Union Association; Mike Schenk, vice president of economics and statistics for the Credit Union National Association; and WOCCU staff.

Minnesota network extension receive national award

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ST. PAUL, Minn. (9/16/08)--The Minnesota Credit Union Network (MnCUN) and the University of Minnesota Extension (UME) received the Community Partnership Award from the National Education Association of Family & Consumer Sciences (NEAFCS) for their collaboration on financial education training for teachers and credit union representatives. The award recognizes NEAFCS members for efforts in building community partnerships to meet the educational needs and concerns of families. Award recipients receive national recognition and monetary compensation to develop additional educational programs to enhance the partnership. “Our partnership is a terrific example of the success that is possible when organizations collaborate on a local level,” said Kristina Wright, MnCUN vice president-communications. “Credit unions are community-oriented financial institutions, and teaching financial education and financial literacy helps to strengthen countless communities across the state of Minnesota.” MnCUN and UME joined forces in 2004 to coordinate financial education “train the trainer” workshops for teachers and credit union professionals. They conducted training in 2004, 2005 and 2007, and are planning 2009 training. Past workshops centered on the National Endowment for Financial Education (NEFE) High School Financial Planning Program and topics such as credit, debt and bankruptcy. The workshops also provide networking opportunities and encourage collaboration. “The networking component is a unique side benefit to our workshops and is not common in other states,” Wright said. “Our ultimate goal is to increase young people’s level of financial education,” said Becky Hagen Jokela, UME Extension educator, family resource management. The partnership can "communicate the importance of financial literacy, and teachers have the option to use others’ knowledge and experiences to make financial topics--which are sometimes obscure, complicated, or seemingly irrelevant to youth--actually interesting and applicable to students,” she said. Hagen Jokela and other UME representatives will attend the NEAFCS Annual Conference in Indianapolis this week and accept the award on behalf of the team.

Open your hearts Texas league asks

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FARMERS BRANCH, Texas (9/15/08)—The Texas Credit Union League asked credit unions in the state Friday to “show what it means to be part of a cooperative movement that looks out for one another” and help out the displaced victims of Hurricane Ike. “Thousands of our credit union family members have fled their homes to get out of harm’s way. They have scattered in shelters across the state,” said Texas league President/CEO Dick Ensweiler on Friday, just before aid efforts were announced (see related story, “NCUF, “Texas foundation activate”). “The last thing we want for the victims of Hurricane Ike, many of whom are our fellow servants of the credit union movement, is to worry about how they’ll access their funds,” said Ensweiler. “I implore upon you to open your hearts to these displaced individuals. If one of them enters your branch, I ask that you do all that you can to aid them. This could be as simple as cashing a personal check at no charge or as selfless as waiving an ATM fee.” In addition to aid efforts by the Texas Credit Union Foundation and the National Credit Union Foundation, the league said it would match credit unions with needs from the storm with credit unions in the state who offered help. Credit unions affected by the hurricanes can list the items they need through filling out a form at on the league’s website. The items will appear on a chart at Credit unions offering resources can go to another page: on the league’s website and submit the items they’re offering.

CUs now dealing with Ikes aftermath

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DALLAS (9/15/08)—Credit unions in Texas and Louisiana—those that could get to their branches--were hoping to begin assessment soon of damages wrought by Hurricane Ike during its 24-hour surge through Galveston and Houston, Texas, and Lake Charles and southwestern Louisiana Friday and Saturday. However, the Texas Credit Union League said Sunday night that authorities were allowing only search and rescue personnel into the areas. "Downtown Houston area is closed except to authorized personnel," said Richard Grady, league vice president of marketing, public relations, and communications. The phone lines for affected credit unions to report in their status have been quiet. News Now learned the status of several credit unions from their websites. One credit union, El Paso Corporation FCU, said it would be closed today because of window and water damage to its sponsor's building. It expected to reopen Tuesday. Mobiloil FCU said two of its six branches in the hurricane affected area would be open today. University FCU said it's Galveston branch is closed. "When officials allow access to Galveston Island, UFCU will promptly assess the condition of the Postoffice Street branch." Houston Police FCU's website said its Travis Branch would open today, but its Memorial Drive and Willowbrook branches are closed. Beacon FCU said that most of La Porte and the surrounding areas are still experiencing power outages but all ACH transactions had been posted. "Our offices are still closed and will reopen as soon as possible." Hurricane Ike was 600 miles wide including its outerbands--twice as wide as a “normal” hurricane. It made landfall as a Category 2 hurricane at 2:10 a.m. CDT in Galveston, bringing with it 13-foot surges, 12 hours of high winds up to 104 mph, flooding, and extensive property damages. In Chambers County alone, 50% of the home were severely damaged. As of Sunday, at least nine people were dead and many others were missing. Millions of people were without power indefinitely, including 90% of Houston, where the wind blew out 50% of the windows in the state's tallest building, the JP Morgan Chase building. Of the area’s 36 oil refineries, 13 were shut down, and the closures were already hiking gas prices at the pump. In Texas alone, more than 176 credit unions were in 10 cities in the hurricane’s direct path. They included 122 with headquarters in the city; the total doesn’t include branches. Of the total, 54 credit unions that are headquartered elsewhere had at least one branch in the cities impacted. The breakdown of credit unions in the cities:
* Baytown, one credit union and a branch of four other credit unions; * Beaumont, 10 credit unions, with branches from seven others; * Clute, one credit union; * Galveston, five credit unions and one branch; * Houston, 86 credit unions and 34 branches; * La Porte, four credit unions and two branches; * Lake Jackson, one credit union; * Lufkin, four credit unions, one branch; * Orange, five credit unions and four branches; and * Port Arthur, five credit unions and one branch.
Two southwestern parishes of Louisiana—Cameron and Jefferson parishes—also bore the brunt of sea surges and wind damages. They included 32 credit unions and 10 branches of credit unions in other cities. Cities hit the hardest included:
* Abbeville, one credit union; * Crowley, one credit union and one branch from another city’s credit union; * Jennings, three credit unions; * Lafayette, 15 credit unions plus three branches; * Lake Charles, nine credit unions and five branches; * Morgan City, one credit union; * West Lake, two credit unions and one branch.
About seven hours after it made landfall, Ike turned into a Category 1 storm and began churning through Texas, Arkansas, and the Midwest. It will affect weather for credit unions across the U.S. this week. "Ike remains an extremely dangerous storm that will continue to cause flooding and wind damages over the next several days," Phil Tschudy, media relations manager for CUNA Mutual Group, told News Now Sunday. "The long duration of high winds, compounded by heavy rains, has and will continue to cause problems for credit unions. Those problems will include flooding, structural damages to buildings, power issues, and limited communications. "Our Credit Union Protection Claims staff reported that, as of Saturday afternoon, areas hardest hit were not yet accessible," Tschudy said. "Over the next several days, authorities have indicated they will prevent anyone from coming into the impacted areas so they can concentrate on search and rescue operations. Because of this and problems with communications, we do not expect to be able to assess the impact this storm has had to credit unions, or to contact them before Monday." CUNA Mutual has arranged for its catastrophe adjusters to go on site to check with policyholders it can't reach by phone or who have not contacted CUNA Mutual. "We encourage credit union policyholders with damages to contact the CUNA Mutual Disaster phone number (800-637-2676), which is answered 24/7," Tschudy said. Credit unions in the impacted areas will be dealing with several issues this week, both immediate and for the long-term:
* Getting to the credit unions to assess damages and their needs. Damages expected include wind damages such as peeled rooftops and windows out and water damage from the surge or flooding. * Coping with power, communications and utility outages. More than two million people and businesses are without power, said the league's Grady. Power is not expected in may areas for weeks, as transmission towers and power poles need to be installed first, he said. The city’s water supply also had some problems Saturday, according to Houston Mayor Bill White in a press conference Saturday ( Sept. 13). * Working with a shortage of credit union staff as employees address the damages to their own homes and their family’s needs, or have difficulty getting to work because of road blockages from debris, flooding and washed-out highways. * Providing alternative service to members needing emergency cash and loans. While members can access ATMs, shared branches and online banking, the power outages made it unclear how many services are working. Credit unions took cautions before the hurricane hit to check their business continuity plans to ensure minimal interruption of service.
As of Sunday night, it was not known which credit unions would be operating today. Thursday--before the storm hit--most credit unions had said they would open today.

More text messaging scams surface

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MADISON, Wis. (9/15/08)—More text-message scams aimed at draining consumers’ accounts are being reported by credit unions in several states. Here are reports from the latest wave of credit unions targeted by scams in Minnesota, Washington and Alabama:
* SPIRE FCU, Falcon Heights, Minn., said consumers checking text messages on their cell phones were warned that their credit union accounts had been locked. They were told that they could fix the problem--by providing their account numbers. Once they give the numbers, the accounts can be drained by the scamsters (Pioneer Press Sept. 9). * Gesa CU, Richland, Wash., was the target of another text messaging scam, according to (Sept. 11). On Wednesday, six people in a sister station, KNDU, reported receiving the text messages, which asked them to call a number to protect their Gesa account. The report said police believe the texts are sent from Spain because money the scamsters have taken is sent there. Police noted the culprits are hard to track down because the Internet provider address used isn’t from a physical location. * A credit union based in Bynum, Ala., was among several financial institutions in the state whose names were used in text messaging scams and e-mail and voicemail message scams (The Anniston Star Sept. 7).
In all cases, the financial institutions warned consumers not to answer the messages and to delete them. Financial institutions would never contact members or customers unsolicited and ask for account and other numbers.

SBA disaster assistance rebuilt after Katrina

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WASHINGTON (9/15/08)--The U.S. Small Business Administration (SBA) says that reforms in its disaster assistance programs should avoid a repeat of the challenges it faced in 2005 meeting the demand for its disaster home and business loans after the Gulf Coast Hurricanes Katrina, Rita and Wilma. Since 2005, SBA has it has rebuilt its disaster operation, upgraded technology, reformed processes and leveraged personnel to create a better system. Specifically, it:
* Improved and streamlined its disaster application review process and approval process; * Increased its business disaster loan limits from $1.5 million to $2 million for physical damage loans and economic injury disaster loans combined. Small businesses and non-profits of all sizes can apply for working capital loans to alleviate disaster-relates economic injury. * Enhanced its internal coordination and strengthened collaboration among federal and state partners. * Completed a comprehensive Disaster Recovery Plan that explains how it would handle a major national disaster. * Added a disaster reserve corps of more than 2,000 individuals to quickly staff disaster field offices. * Trained nondisaster staff to process disaster loan applications and assist6 in other disaster functions. * Secured space in multiple locations across the country. * Implemented an online application for disaster loans to speed up the process and make it easier. * Expanded technology to handle 12,000 concurrent users, from 2,000 simultaneous users in Katrina. * Implemented a telecommunications system to handle 20,000 calls per day, up from 10,000.
Since the 2005 hurricanes, SBA has disbursed more than $4.9 billion in disaster loans to 102,903 homeowners and renters in the Gulf region. Businesses there received 16,828 business disaster loans with $1.5 billion in disbursements.

NCUF Texas foundation activate CUAid

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GALVESTON, Texas (9/15/08)--The National Credit Union Foundation (NCUF) and the Texas Credit Union Foundation have activated the online disaster relief system, CUAid, to raise money for credit union people affected by Hurricane Ike. Credit union supporters in every state can donate through a secured website that accepts credit cards and wire transfers. While Texas credit unions can donate directly to the Texas Credit Union Foundation, individuals in Texas are encouraged to donate online via “We are encouraging credit union leaders all across the county to use as a channel to collect donations from their employees, volunteers, and members,” said NCUF Deputy Director Steve Bosack. “We plan to work with the state credit union foundation to distribute money efficiently to those who need it in the affected areas.” “We will work closely with affected credit unions and the Texas Credit Union League to assess the needs in the affected areas,” added Texas Credit Union Foundation Executive Director Jill Pharr. “We will also serve as the repository for Texas credit union disaster donations, which will then be provided in the form of emergency grants for credit union employees.” The Texas foundation has a two-phase support system, beginning with emergency grants of up to $500 to assist affected credit union employees with their immediate needs. The second phase will provide support for credit union employees with unmet needs after other relief has been exhausted. All donations via will go toward grants as well. Donations are forwarded in their entirety to credit union organizations in affected areas through NCUF, which is tax-exempt under Section 501(c)(3) of the U.S. Internal Revenue Code. “It never ceases to amaze me how willing the credit union movement is to open their hearts to one another in times of disaster,” Pharr said. “We are encouraging credit unions across the Lone Star State to make the CUAid link available on their website, so employees and members alike can contribute to disaster relief efforts.” “CUAid is one of many ways our foundation gives back to the credit union movement to thank donors for all their generosity,” Bosack concluded.

Study Many employees are one paycheck from trouble

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CHICAGO (9/15/08)--Many employees are one paycheck away from financial trouble, according to a study by a Chicago-based credit union and employee benefits specialists group. Alliant CU, a $5.693 billion asset credit union, and the International Society of Certified Employee Benefits Specialists (ISCEBS) announced the results of their study on U.S. workers' personal financial situations and employers' viewpoints and involvement regarding their employees' financial lives. A white paper, "American Workers: Getting Ahead or Just Getting By," is based on two surveys conducted in March. One polled ISCEBS member benefits specialists about their employee benefits and ability to help in their employees' financial lives. The other surveyed U.S. workers about their opinions and attitudes regarding their employers as financial partners and the extent to which their employers help out. Key findings include:
* Employer benefits such as health and retirement plans are seen as important but primarily for future rather than present needs. Many employees have financial needs that require assistance "here and now." * Employees with financial concerns spend significant work time dealing with personal financial matters. * Although employees are generally pleased with their income levels, they can't seem to save enough or get ahead financially. Half describe themselves as living from paycheck to paycheck. Less than 20% considered themselves to be financially secure. * More and more workers are financially strained by increasing financial debt. * Employees generally feel they lack knowledge about handling money.
"Financial literacy and low cost, high value financial services are keys to economic health for individuals and our economy as a whole," said Alliant CU President/CEO David W. Mooney. He applauded benefits specialists' efforts to provide financial literacy and services that deliver daily, not deferred, value. Alliant is a financial benefit solutions provider to more than 140 employer groups and networks, and a national partner of Operation HOPE, a national foundation that provides financial education classes in public schools around the U.S. A full copy of the white paper is available at the credit union's website. Use the resource link.

CU reforms in New Brunswick expected by Oct. 31

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FREDERICTON, New Brunswick (9/15/08)--The New Brunswick credit union system expects to implement new reforms by Oct. 31. Legislative reforms brought about after the provincial government's bailout package and consequent political fallout from the Caisse Populaire de Shippagan deficit will soon be in place, Robert Penney, chairman of the New Brunswick Credit Union Deposit Insurance Corp., told a legislative committee (Canadaeast News Service Sept.11). The provincial government sued over accounting practices and loan policies by individuals at the caisse, and alleged the practices partially led to a deficit of $30 million. Taxpayers are now responsible for a bailout package valued at double that amount (eNBusiness July 17, 2007). The legislative amendments were passed in the spring. It is now up to the Liberal party cabinet to have them proclaimed formally by the lieutenant governor. Compared with two years ago, there is a lot more financial stability in the system, Penney told the paper. "We have fewer caisse populaires and credit unions under supervision, the new anglophone stabilization board is very strong, stronger than it was in the past," he said. "I think the future looks bright.” Penney is also superintendent of credit unions. After the bailout was offered, the Liberal government introduced a discussion document that led to a series of legislative reforms this spring. Justice Minister T.J. Burke brought about the first reforms to the sector in 15 years in May. The main elements of the restructuring included dropping the 100% guaranteed deposit protection to $250,000, introducing provisions to allow regulatory authorities to act quickly and not be stalled by appeal processes, and reforming the boards.

WOCCU to lobby Polish Parliament this week

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GDANSK, Poland (9/15/08)--Participants in a World Council of Credit Unions (WOCCU) engagement program, meeting in Poland this week to study the country's cooperatives, will advocate on behalf of what has been one of the world's fastest-growing, most successful credit union systems.
A branch of Stefczyka, Poland's largest credit union, is located in the National Association of Cooperative Savings & Credit Unions’ headquarters in Sopot. The acronym SKOK is the brand by which Polish credit unions are known. (Photo provided by the World Council of Credit Unions)
Legislation hostile to financial cooperatives recently was proposed to the Polish Parliament, putting the continued growth of the country's credit union movement at risk, say Polish credit union officials. “The National Association of Cooperative Savings & Credit Unions (NACSCU) has seen its members' continued success challenged by Polish banking groups’ introduction of amendments to existing credit union laws that are hostile to the movement,” said Brian Branch, WOCCU executive vice president and chief operating officer. Branch is leading the group of U.S. credit union and league executives. “NACSCU executives have asked us to advocate on the movement's behalf in Warsaw this week,” he added. The proposed amendments seek to change Poland's credit union law, passed in 1995 at the rebirth of the Polish credit union movement. Among other issues, the amendments would end all lifetime membership provisions, requiring members to leave their credit unions if they leave employers who belong to those credit unions' fields of membership. Also, the amendments would limit credit union access to certain funding sources and reduce credit union oversight authority for NACSCU, one of WOCCU's member organizations. "This is a key moment for the Polish movement," Branch said. "If these amendments are passed, they would damage Poland's credit union system." Polish and U.S. credit union movement executives will attempt persuade lawmakers to adapt pending amendments to make them less harsh toward Polish credit unions, said Grzegorz Bierecki, NASCU president and WOCCU treasurer. Joining Branch on the engagement tour and in advocacy efforts are:
* Joe Bergeron, president, Association of Vermont Credit Unions; * Bill Cheney, president/CEO, California and Nevada Credit Union Leagues; * Barry Jolette, CEO, San Mateo CU, Redwood City, Calif., and WOCCU first vice chairman; * Jim McCormack, president, Pennsylvania Credit Union Association; * Mike Mercer, president, Georgia Credit Union Affiliates; * John Radebaugh, president, North Carolina Credit Union League; and * Mike Schenk, vice president of economics and statistics, Credit Union National Association.
The delegation of U.S. executives will meet with Polish government officials in Warsaw on Thursday. The group will also spend time with credit union and association officials in Gdansk and Krakow.

Elections prompt N.Y. legislative voters guide

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ALBANY, N.Y. (9/15/08)--The Credit Union Association of New York released its 2008 voter’s guide, which details state legislators’ records on issues affecting credit unions statewide. “We want to make sure that our members know if their local lawmakers support credit union-friendly legislation and credit unions before they go to the polls in November so they can make informed choices when voting,” said association President/CEO William Mellin. The Voters’ Guide 2008: An Insider’s Guide to the State Legislature’s Credit Union Record provides a legislative summary of the progress made on behalf of New York credit unions this year. It has leadership profiles and reveals which state lawmakers sponsored the five top bills benefiting credit unions in 2008, including:
* Municipal Depository Choice, which would allow municipalities to make deposits in credit unions; * Excelsior Linked Deposit Program, which aims to permit credit union participation in a program that allows other financial institutions to leverage state funds to make affordable loans to small businesses; * Credit Union Development Districts, which seeks to have credit unions included in a program that provides property tax breaks to banks and thrifts that establish branches in underserved areas and allows municipalities to invest funds in those institutions at special interest rates; * Financial Education, which would require financial education instruction to be included in the school curriculum for all high school students statewide; and * Robbery Legislation, which intends to deter robbery by stiffening penalties.
The guide also provides information on which legislators have visited a credit union or attended a credit union event in 2008.

Eastern Financial Florida CU helping Haiti

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MIRAMAR, Fla. (9/15/08)--Eastern Financial Florida CU Thursday launched “Help Haiti Again” to raise money for the many thousands of people whose lives are in danger due to recent hurricanes and devastating floods. Haiti has been hit with four hurricanes this year. Through the month of October, all of the $1.786 billion asset, Miramar, Fla.-based branches are inviting members and employees to make a monetary donation to Food For the Poor, a South Florida-based charity that delivers aid to the island. “This has been a terrible year for the Haitian people whose country is already the poorest in the Western Hemisphere,” said Mark Holmes, Eastern Financial director of marketing. “Many of our members and employees are directly touched by the current crisis because they still have friends and loved ones in the country. So we wanted to do what we could to help out.” During May, the credit union organized a month-long campaign called “Help Haiti Now” to feed starving Haitians who were victims of an island-wide food shortage. Since an average family in Haiti can be fed for $12 per month, the credit union encourages donations in increments of $12. Eastern Financial’s corporate office is collecting all of the checks and mailing them daily. Members also can donate by way of direct account transfer or by going on line to a customized site. Even people who are not members of the credit union are invited to participate by stopping at any of the branches and dropping off a check or by logging on to the website. Food For the Poor feeds destitute families in Haiti and throughout the Caribbean and Central and South America. The World Council of Credit Unions (WOCCU) does not have affiliated credit unions in Haiti. Haitian credit unions work with Desjardins Group in one of its development programs, WOCCU said. Desjardins said that its staff and credit unions are OK, but it had no news of other credit unions, WOCCU told News Now. The Desjardins Group is the largest association of credit unions in North America located throughout four Canadian provinces, serving 5.8 million members.

CU System briefs (09/12/2008)

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* JOLIET, Ill. (9/15/08)--JT CU, the first student-run credit union in a Will County, Ill., high school, opened two branches at Joliet West High School and Joliet Central High School Sept. 3 and 5. JT CU is a collaboration among Prairie Trail CU, Joliet Township High School District 204, Will County Regional Superintendent of Education Jennifer Bertino-Tarrant, and County Treasurer Pat McGuire. "Our goal is to help teach students the basics of money management and bring the value of mainstream banking to life by giving each student a solid foundation on which to make financial decisions for the future," said Prairie Trail CU President/CEO Matthew Thraen. Pictured at Joliet West's grand opening are: from left, Joliet West student Shonteese Booker; Joliet Central student Teonta Pruitt; JTCU Branch Supervisor Deanna Wolff; and Joliet West Business Management and Information Systems Coordinator Greta Lesnial.(Photo provided by the Illinois Credit Union League) … * ALBUQUERQUE (9/15/08)--Kirtland FCU in Albuquerque was named as the 2007 Outstanding Air Force Credit Union, by the Air Force. KFCU competed against 26 other credit unions from all over the world. According to Col. Michael Duvall, 377th Air Base Wing commander, the credit union is an "invaluable partner with Team Kirtland and is clearly committed to improving the quality of life of Kirtland personnel." KFCU offers financial education to Team Kirtland members through regular briefings, educational workshops and First Term Airman briefings. It also offers deployment loans, loan extensions and educational support programs for deployed personnel and their families … * ABERDEEN, Md.(9/15/08)--Aberdeen Proving Ground FCU (APGFCU)
Click to view larger image Click for larger view
members and employees donated thousands of new school supplies during the credit union's annual Back to School Supply Drive. The supplies will be distributed this month to its partner schools in Harford and Cecil County, Md. Students will receive new backpacks, lunch bags, notebooks, crayons, pencils, rulers, protractors, glue sticks and more. Pictured with some of the supplies is APGFCU's education team. (Photo provided by Aberdeen Proving Ground FCU) … * NEW CASTLE, Dela. (9/15/08)--Elmeretta Frederick, former credit union manager and Delaware Credit Union League board chairman, died Sept. 6, the league has learned (Together> Sept. 12). She was former manager of a credit union she helped organize for Teamsters' Local 306 in 1971. Frederick stayed in that position until the credit union merged with Chryco Newark FCU (now American Spirit) in 1986. She served several positions with the league, including acting managing director in 1978. She also was a teller and later manager of DPL FCU before her retirement …

San Antonio CU places ATMs for hurricane evacuees

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SAN ANTONIO (9/15/08)--San Antonio FCU (SACU) has placed two ATMs at the Port of San Antonio to provide Hurricane Ike evacuees access to their funds. Port San Antonio is a staging area for evacuees coming into San Antonio. As a community service, the $2.6 billion asset credit union won't assess an SACU surcharge on transactions from the machine. "We are pleased that we have the capability to provide this service on short notice to help our friends who have been temporarily displaced due to Hurricane Ike," SACU Chief Financial Officer Mark Dwyer said. "The credit union invested in mobile ATM units so it could provide an additional level of service to its members and the community at large," Dwyer said, adding the ATMs "can be deployed to make the evacuees' lives a little bit more manageable." The credit union's portable ATM unit can move to a service location easily and its "ATM on wheels" can be set up for short-term use at locations such as weekend festivals and community events.

Situation reversed for CU that helped in Katrina

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LAKE JACKSON, Texas, and PLAQUEMINE, La. (9/12/08)--In 2005, a credit union in Texas flew to the rescue to help a Louisiana credit union experiencing a liquidity crisis in the wake of Hurricane Katrina. Today, with Hurricane Ike aimed at Texas, their roles could reverse. "Now that a storm that may equal the most destructive to hit Texas in two centuries is aimed straight at our credit union, the roles are reversed," said Edward Speed, president of the $1.3 billion asset Texas Dow Employees CU, located in Lake Jackson, Texas. "Our headquarters is directly in the path of the eye of Ike. We sit at 15 feet above sea level in an area that may experience 25-foot storm surges and 125 mph winds," Speed said in an e-mail. However, Thursday morning Speed received an unsolicited e-mail from Jeffrey Hendrickson, president/CEO of Dow Louisiana FCU, a $150 million asset credit union in Plaquemine, near Baton Rouge. Hendrickson wrote that his credit union's board had directed that they offer Speed's credit union full support--including office space, phone centers, taking over the automated clearinghouse and Fed wiring needs and even sending employees after Ike hits. In early September 2005, a few days after Hurricane Katrina hit Hendrickson's credit union, he called Speed. Like many other credit unions after Katrina struck, Hendrickson's was operating on a cash basis. Just before the Labor Day weekend, its cash flow was diminishing rapidly. An expected delivery from the Federal Reserve hadn't arrived (News Now Sept. 7, 2005). Within 15 minutes of the call, Speed added up all the cash on hand at all Texas Dow's branches; within 25 minutes Speed committed $600,000 in cash to Dow Louisiana FCU. Speed, who has a pilot's license, and Lance Wortham, commercial vice president, loaded the cash onto Speed's plane and flew two hours to Baton Rouge. Six hours after the initial call, Speed, Wortham and a armed security representative from the sheriff's department, delivered the cash and saved the day. Hendrickson's letter to Speed said his credit union was "standing by to assist … day or night. "We have put our senior management on alert to be ready. As our sister credit union, you all are very important to us--our board of directors has asked that we do whatever is possible to ensure you have business continuity," said the Louisiana CEO. "You all were here in a moment's notice when we needed you--and we are going to be there for you," Hendrickson wrote. Speed noted that Hendrickson "has also called me twice this morning. This is even as they clean up from Hurricane Gustav that hit them last week," wrote Speed. "There is no way to experience this and not be emotionally moved."

CU closures announced in Texas

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FARMERS BRANCH, Texas (9/12/08)--Credit unions along the Texas gulf coast began closing yesterday in preparation for Hurricane Ike. Many are closed today and tomorrow, said the Texas Credit Union League. President Bush declared an emergency in Texas, and Gov. Rick Perry issued a disaster declaration and activated 7,500 National Guard troops in preparation for the Category 2 hurricane, which is expected to strengthen today. As of Thursday, officials have issued mandatory evacuation orders in Brazoria and parts of Matagorda County. Voluntary evacuation orders were ordered for Galveston, San Patricio and Victoria counties and parts of Jackson County and the City of Corpus Christi, said the league. Brazoria County, Galveston and other areas already have been hit by one hurricane--Hurricane Dolly in July. All Sabine area credit unions were under "mandatory evacuation" until further notice, said the league Thursday afternoon. A league representative in Corpus Christi, who spent Thursday calling credit unions, said credit unions there are either closed today and Saturday or are "playing it by ear." "The majority have a phone message for the members explaining that due to the weather/Hurricane Ike, they will be closing on such and such a date and will reopen on Monday," the rep told the league. They are referring members to their website and phone messages for updates. So far, several credit unions announced closures due to the weather, according to Linda Webb-Manon, league communications director. "This of course isn't all of them. Our league reps have been working diligently to keep in close contact with our credit unions in the affected areas." Some began closing at noon on Thursday, with an occasional branch closed earlier. All are either already closed today or closing sometime today, and all will be closed on Saturday:
* Mobiloil FCU, Beaumont; * Transtar FCU, Houston; * Houston Police FCU, Houston; * Liberty County Teachers FCU, Liberty; * TexasOne Community CU, Houston, closing at noon today; * InvesTex CU, Houston, closing at ll a.m.; * Houston Highway CU, closing at noon; * Houston Texas Fire Fighters FCU, Houston, closing at noon; * Union Fidelity, Houston, closing at noon; * Primeway FCU, Houston; * El Paso Corp. FCU, Houston, closing at 3 p.m.; * United Energy CU, Houston, closing this afternoon; * First Service CU, Houston; * SPCO FCU, Houston; * Cy-Fair FCU, Houston, closing at noon; * USE CU, Houston, closing at noon; * First Community CU of Houston; * Brazos Valley Schools CU, Houston/Katy, closing at noon; * Smart Financial CU, Houston; * PIE CU, Houston; and * Members Choice CU, Houston, closing at noon.

Texas CUs league brace for Hurricane Ike

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DALLAS (9/12/08)--Nearly 100 credit unions are in the current path of Hurricane Ike, according to the Texas Credit Union League, which is helping Texas credit unions prepare for the landfall late tonight or early tomorrow morning. "We have nearly 100 credit unions in Ike's current path, and over 800,000 consumers belong to these credit unions," said Dick Ensweiler, league president/CEO. "Fortunately, we have plans in place to handle the challenges hurricanes bring." Thursday the league established a "credit union condition information" page on its website to assist employees of its credit unions in disseminating information to their members. It also informed CEOs of all credit unions about the procedures. Information shared will be placed on the league's Disaster Preparation website (Use the resource link). The league's Disaster Preparation website offers up-to-date tracking of the hurricane's path; links to sites such as the American Red Cross, the Federal Emergency Management Agency (FEMA), the Texas Credit Union Department and the National Credit Union Administration; and downloadable disaster recovery documents. Members of the potentially affected credit unions can find out if their credit union belongs to the CU Service Center shared branching network by calling 800-919-2872 or visiting its website,, said the league. "How well you, your family, your home, or business survive a disaster often depends on how well you prepare beforehand," Ensweiler said. "Hurricane Katrina taught us a valuable lesson on that. Communications and planning is essential, and we are committed to doing our part to ensure our member credit unions and the families they serve are prepared for whatever may come." The league reminded credit union members in Texas that their funds are secure and insured by the National Credit Union Share Insurance Fund. "As we brace ourselves for the worst and hope for the best, the league wants members to know that it is prepared to serve as a valuable resource for all 500 plus Texas credit unions and the seven million members they serve," Ensweiler said. As of Thursday afternoon, Hurricane Ike was still a Category 2 hurricane but was strengthening. It was expected to reach a Category 3 and possibly as high as a Category 4 before making landfall on the Texas coast. Because of its size, it is expected to produce violent weather and sea surges in states all along the Gulf Coast. For a list of credit union closures, see the News Now story in System News, "CU closures announced in Texas."

CUNA disaster team activates CULocate for Ike

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MADISON, Wis. (9/12/08)--With Hurricane Ike ready to make landfall, the Credit Union National Association (CUNA) Disaster Preparedness Team is prepared to assist credit unions. CULocate was activated Thursday for the credit unions registered in the state of Texas. The credit unions include:
* AAFES CU, Dallas; * Amarillo Community FCU, Amarillo; * America’s CU; Garland; * Austin FCU; Austin; * Cicost FCU, Sherman; * CTECU, Bellaire; * Dupont Goodrich FCU, Nederland; * Family 1st Texas FCU, Fort Worth; * FedStar CU, College Station; * Lufkin FCU, Lufkin; * NRCS FCU, Fort Worth; * PrimeWay FCU, Houston; * Sabine FCU, Orange; * StarTrust FCU, Houston; * Tarrant County CU, Fort Worth; and * Walker County FCU, Huntsville.
At this time, CUNA has activated the credit unions’ non-emergency messages. Credit unions affected by Ike will have their emergency messages activated when CUNA is contacted. CUNA will continue to include any new credit union submissions as they occur. For assistance, contact:
* Julie Esser 608-231-4213 (office--leave a message with a call-back number), 608-332-2726 (cell),; * Wes Millar 608-231-4138 (office--leave a message with a call-back number), 608-212-2848 (cell),; * Dorothy Steffens 608-231-5719 (office-leave a message with a call-back number), 608-213-1584 (cell),
CUNA is monitoring Hurricane Ike and is ready to respond, if necessary, with resources that include the following: CU Locate: the Credit Union National Emergency Information System provides credit union members with a toll-free number, 1-877-CULOCATE (877-285-6228), to receive information about the status of their credit union affected by a crisis. R.E.S.C.U.: the Relief Effort and Support for Credit Unions is the credit union movement's effort to prepare for and respond to large-scale natural and man-made emergencies and business interruptions. This resource includes Adopt-A-Credit Union. Also, CUNA Strategic Services offers disaster preparedness and recovery services through several alliance programs:
* Agility Recovery Solutions can provide a mobile recovery unit fully equipped with power, communications, computer equipment, and many other amenities within 48 hours of a disaster. * Strohl Systems offers PLANet, the industry's only Internet-based business continuity planning tool designed to help credit unions meet NCUA and Federal Financial Institutions Examination Council regulations for business continuity and disaster recovery. * VoiceGard offers a suite of services to restore telephone capabilities after a catastrophic system (PBX) failure or loss of facilities.
For more information, use the resource links. Also, the National Credit Union Administration has encouraged credit unions to prepare for the pending hurricane. See story in News Now's Washington section, "NCUA encourages CU readiness for Ike."

Strategic partner VoiceGard ready to assist Texas CUs

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CHERRY HILL, N.J. (9/12/08)--CUNA Strategic Services provider VoiceGard, a voice recovery services provider, is ready to assist credit unions if Hurricane Ike hits Texas. The Cherry Hill, N.J.-based company provides credit unions with message mailboxes through CU Locate. Members can call during a disaster to find out information relevant to their credit union’s status. VoiceGard is working with the Credit Union National Association to prep credit unions for Ike. “We’re getting credit unions ready to go,” said Mark Mowad, VoiceGard vice president of sales. Credit unions can sign up with VoiceGard to create mailboxes and have the option to change their own mailbox settings or information during times of disaster. They also can sign up to receive a toll-free number to publish on their websites or other correspondence for members to call in the event of a disaster. The toll-free numbers serve as alternate numbers and are routed to the VoiceGard recovery center where members can receive information or leave messages if the credit union’s branch is unreachable. VoiceGard can redirect calls to cell phones, alternate locations, home phones or IP phones. IP phones, or Internet phones, can be plugged in anywhere there’s an Internet connection, Mowad told News Now Thursday. During previous storms, VoiceGard successfully helped credit unions, and it is prepared to do that again during Hurricane Ike, Mowad said. “Hopefully we won’t have to, but we have the staff and we’re prepared to help if needed,” he added.

Council papers view rewards programs employee retention

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MADISON, Wis. (9/12/08)--Credit unions can learn how to create consumer rewards programs that deepen member relationships, and what benefits to offer to retain employees in two new white papers from the CUNA Councils. “Credit Union Rewards Programs That Enhance Member Relationships,” by the CUNA Operations, Sales, and Service (OpSS) Council, discusses how to develop a program that deepens member relationships. The paper outlines the reasons for rewards programs and the types of programs available. It uses tips and credit union case studies as examples. Credit unions need to combine “head and heart” when it comes to what kind of program they offer, said Denise Wymore, a credit union consultant who helped create a member points program used in about 20 credit unions. “Let’s say you have 30,000 aggregate points and as a reward, you get unlimited ATM use,” Wymore said. “I don’t really feel the reward. I’m not consciously aware, every time I use the ATM, that I’m not being charged by my credit union. And if I’m being charged by the ATM but not by the credit union, that’s negative. I’m not feeling the love.” The rewards should connect with both parts of the member, she added. The second white paper, “Retaining Key Employees,” by the HR/TD Council, investigates strategies and retention factors employed by credit unions--beyond the obvious attractions--for recruiting and keeping officer-level employees. Executive benefits programs and coaching, advanced educational opportunities, and organizational culture are all addressed as prime retention factors in this paper. Tips for identifying key employees during the interview process are provided. For example, Lee Alderman, assistant vice president of employee relations and development at Redwood CU, Santa Rosa, Calif., identified two traits that the credit union’s star employees all share. They are all good relationship-builders/networkers with members and staff, and they take responsibility for their own learning, he said. “These are the type of people we want to hire,” said Alderman. “We redesigned our education and hiring process based on what we learned from these 10 individuals. We added behavioral questions on our interviews to recruit their type of individual.” For more information on these white papers and a list of other topic papers from both councils, use the resource link.

American Partners FCU opens student branch

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REIDSVILLE, N.C. (9/12/08)--American Partners FCU opened a student-run credit union branch in Reidsville, N.C., Wednesday, according to the North Carolina Credit Union League.
American Partners FCU opened a student-run branch at Reidsville (N.C.) High School Wednesday. From left are: Dorina Edwards, American Partners president/CEO; American Partners Marketing Specialist Stephanie Wilson; and student branch employees Yuridia Serrato and Illya Winstead. (Photo provided by the North Carolina Credit Union League)
The Ram branch will provide students, teachers and school employees the option of opening accounts with the credit union. Reidsville, N.C.-based American Partners also will provide financial education to students at the school (Weekly Update Sept. 11). The branch will be open three days a week for two hours each day. It will offer checking and savings accounts, online banking and debit cards. Rockingham County School Superintendent Rodney Shotwell supported the credit union opening the branch at the school. “If we can teach them here not to pick up that credit card application in college [and rack up a lot of debt], we will have accomplished something,” he said. Stephanie Wilson, American Partners marketing specialist, was credited for bringing the branch to the school. She was inspired to open the branch after visiting a branch of Henrico FCU at a high school in Richmond, Va. State Rep. Nelson Cole (D-N.C.), U.S. Rep. Brad Miller (D-N.C.) and U.S. Senate candidate Kay Hagan, along with members of the Reidsville city council, attended the branch’s opening ceremony. American Partners has $49 million in assets.

CU System briefs (09/11/2008)

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* ST. LOUIS (9/12/08)--Credit union leaders at Postal Federal Community CU, Springfield, Mo., visited with U.S. Rep. Roy Blunt (R- Mo.) Sept. 8. Blunt talked about credit union issues with Steve Pierson, president/CEO of Postal Federal, and Cathy Stroud, president/CEO of Community Financial CU, Springfield (The Missouri Difference Sept. 10). “Congressman Blunt was interested to hear how the mortgage crisis has affected credit union members in Southwest Missouri and what credit unions are doing to help the situation,” Stroud said. From left are Pierson, Blunt and Stroud. (Photo provided by the Missouri Credit Union Association) ... * ST. LOUIS (9/12/08)--U.S. Rep. Todd Akin (R-Mo.) met with credit union representatives during a breakfast meeting in Wildwood, Mo., Sept. 5. Attendees thanked Akin for co-sponsoring the Credit Union Regulatory Improvements Act and gave him a copy of the Missouri Credit Union Association’s (MCUA) recent study on the subprime mortgage crisis in Missouri (The Missouri Difference Sept. 5). Other attendees included Akin staffers Kevin Roach; Laura Alfeldt, First Community CU, Chesterfield; Kathryn Chillson, Electro Savings CU, St. Louis; Randy Yeck, Vantage CU, Bridgeton; Rosie Holub, MCUA president/CEO; and Amy McLard, MCUA vice president of public and legislative affairs. From left are: Chillson, Alfeldt, Holub, Akin and Yeck (Photo provided by the Missouri Credit Union Association) ... * COLUMBIA, Md. (9/12/08)--The Maryland and District of Columbia Credit Union Association (MDDCCUA) board of directors named congressional candidate Frank Kratovil (D-Stevensville) a “Friend of Credit Unions.” MDDCCUA supports Kratovil’s effort to gain the seat being vacated by another longtime “Friend of Credit Unions,” Rep. Wayne Gilchrest (R-Md.). MDDCCUA confers “Friend of Credit Unions” status on those who demonstrate a willingness to protect, promote and advocate for a positive legislative and regulatory environment for credit unions (Focus Newsletter Sept. 8) ... * CAPITOLA, Calif. (9/12/08)--Bay FCU, Capitola, Calif., sponsored the 26th annual Capitola Art and Wine Festival in Capitola Sept. 6 and 7. Thirty-two Bay FCU volunteers handled ticket sales during the event. The credit union has sponsored the festival for the last five years. About 25,000 were in attendance. About 25% of the proceeds from the festival are donated to local schools for art and sports programs. Bay FCU has $654 million in assets. From left are: Chris Bond, Terry Beech and Bay FCU employees Ruby Stiga, Tiffany Zachmeier, Martha Getchell, Laura Simmons, Lucy Sierra, Jalene Gladstone and Brooke McDonald. (Photo provided by Bay FCU) ... * KINGSPORT, Tenn. (9/12/08)--A woman accused of embezzling more than $100,000 from Appalachian Community FCU pleaded guilty Sept. 6 in the U.S. District Court of Greeneville, Tenn. (Times-News Sept. 8). Trena Bledsoe faces up to a $1 million fine and 30 years in prison. She is accused of taking $105,900 from Appalachian Community FCU, Kingsport, Tenn., between April 2006 and 2007. She was employed at the Rogersville branch as a teller and flagged members’ accounts so that no statements would be sent to the members. She then took $27,000 from the accounts ...

Texas league prepares to aid CUs through Ikes impact

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FARMERS BRANCH, Texas (9/11/08)--The Texas Credit Union League has sent out an advisory to all Texas credit union employees preparing for a potential disaster with a strengthening Hurricane Ike headed toward the state's coastline. According to Richard Grady, vice president of marketing, public relations and communications, the advisory went out Wednesday. The Category 1 hurricane strengthened to Category 2 as of early Wednesday evening and was expected to continue strengthening over the next 36 hours. Forecasters are predicting it will hit landfall somewhere along the Texas coast Saturday morning ( Sept. 10). "If Hurricane Ike comes on shore as a Category 3 or larger, we may need to execute procedures in our offices to support displaced workers and credit unions," said the league advisory. "Preparations are being made at this time. Our website will carry information, as well as advisements to you and your members." The advisory said that if the hurricane continued its current course, it would hit the Mantagorda Bay, San Antonio Bay/Victoria area on Saturday morning. However the state is preparing for the effects to be felt on Friday. The brunt of the higher winds and storm surge will be felt up to the Galveston Bay area, said the advisory. Once on land, the hurricane would continue inland as a tropical storm, which pack winds of up to 75 mph, up to Austin. The Texas Credit Union Department, the state regulator, advised state-chartered credit unions to "monitor this storm closely, heed warnings form your local leaders, and take necessary and appropriate precautions to safeguard property and personnel." Credit unions in Texas have temporary authority to close offices threatened by the storm if they notify the department as promptly as possible, said the department's advisory. They also have authority to alter payment terms or grant new loans to assist members through the temporary aftermath of a natural disaster. Credit unions impacted by the hurricane are asked to contact the regulator by phone, fax or e-mail within 24 hours after the storm to report any damages and the operational status of the credit union. CUNA Mutual Group said it is also watching the hurricane. "As Hurricane Ike positions itself to make landfall sometime early Saturday morning, we will continue efforts to proactively contact credit unions in the current projected path of this storm, which is currently near Corpus Christi, Texas and the surrounding area," said Phil Tschudy, CUNA Mutual media relations manager. "Ike has proven to be challenging with its unpredictable track, and we will continue to monitor and reassess our strategy as this storm progresses," he said. "CUNA Mutual's Credit Union Protection Disaster Team remains activated and will address any storm-related losses and coordinate property-casualty relief efforts. We encourage credit unions that need assistance to contact our Disaster Phone 24 hours a day, seven days a week at 800-637-2676."

Gustav damages to CUs less than 1 million

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MADISON, Wis. (9/11/08)--Damages to credit unions from last week's Hurricane Gustav have added up to less than $1 million, according to CUNA Mutual Group. And the National Credit Union Administration reported that only a few are still not operating. "We had reports of wind and rain damage, mostly in Louisiana, with some extension into Mississippi, and we continue to see a few claims trickle in as credit unions get back to business," said Phil Tschudy, media relations manager at CUNA Mutual. "About 30 policyholder credit unions have submitted slightly more than 50 claims to date, with losses totaling less than $1 million," he told News Now. "Fortunately, damages from Hurricane Gustav were far less than we expected; however, as I mentioned last week, this doesn't mean some credit unions will not have challenges ahead of them," he said. The National Credit Union Administration (NCUA) checked the overall operating status of 211 credit unions in Louisiana and Texas affected by the hurricane. Of those, "only 13 remained non-operational Sept. 9," the agency said Wednesday, adding that 98% of credit union members affected by the hurricane have access to their accounts. NCUA and credit unions in the Gulf Coast took a variety of proactive measures that enabled rapid recovery from the potentially disastrous Gustav, the agency said. In the days leading up to the hurricane Sept. 1 landfall in eastern Louisiana, NCUA established a toll-free telephone number to provide members with immediate access to information and assistance. It activated backup continuity teams and provided direction on Aug. 29 through regional offices about hurricane preparations. It also released a public service announcement (PSA) for consumers to nearly 60 media outlets in the potentially affected areas. The PSA detailed:
* Federal deposit insurance coverage for credit unions; * How members could access their credit union funds in a natural disaster; * The toll-free credit union member hurricane telephone line; and * How to access NCUA via the Internet for information about affected credit unions.
Since 2006, NCUA has advised credit unions in hurricane-prone states to review contingency of operation plans and business continuity procedures to ensure their ability to provide financial services to their members, the agency said. IT also promoted U.S. Treasury's GoDirect program, the electronic delivery of federal benefits to ensure consumers have consistent electronic access to their funds, even in a disaster. Many credit unions came through Gustav just fine. In Louisiana, New Orleans Firemen's FCU, based in Metairie, said it was able to provide continuous service during Hurricane Gustav. "We were able to provide continuous service to our members via shared branching and through an alliance with CUNA Mutual's Loanlink center," said Cami W. Crouchet, chief operations officer of the $122.7 million asset credit union. "We also work with Telecom Recovery, which was a wonderful way to update our staff on what was going on," she told News Now. The credit union also updated its website several times a day with the most current information on the credit union, she said.

WOCCU IASB to reconsider CU accounting standards

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LONDON (9/11/08)--The International Accounting Standards Board (IASB) Wednesday agreed to reconsider applying its International Financial Reporting Standards to credit unions, based on a comment letter submitted earlier this year by the World Council of Credit Unions (WOCCU). “IASB's reconsideration of its standards is rare as a rulemaking body,” Dave Grace, WOCCU vice president of association services, said. “We consider the move a strong vote of confidence in the global credit union movement.” Certain provisions in the IASB-proposed accounting standards for small and medium-sized enterprises (SME) could be detrimental to credit unions, according to an April 4 letter by Grace to IASB board member Thomas E. Jones. WOCCU’s greatest concerns focused on the draft’s failure to clearly identify to whom the standards apply and failure to clearly sufficiently simplify reporting requirements for smaller institutions, Grace wrote. “Excluding credit unions from the scope of the SME standards and requiring adherence to the full IFRS is both impractical and counter to the IASB’s intention of making accounting requirements more accessible to smaller non-listed institutions,” Grace said. IASB has indicated that credit unions take public deposits, requiring that members be given access to full International Financial Reporting Standards as opposed to the simplified SME standards. However, IASB agreed to reconsider whether credit unions would fit within the scope of entities employing the SME reporting standards. Grace's letter said standards should be applied to entities that hold assets “for a broad group of outsiders such as a bank, insurance entity, securities broker/dealer, pension fund, mutual fund or investment banking entity.” Failure to include credit unions in the list may imply inclusion in full International Financial Reporting Standards, which could create insurmountable hurdles for many SMEs, WOCCU said. IASB is expected to respond to WOCCU’s recommendation by year-end. WOCCU will work with its member organizations and other interested parties to mobilize support for IASB’s reconsideration of its standards.

Hearing on tax uniformity postponed

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HARRISBURG, Pa. (9/11/08)--The Pennsylvania Department of Banking, Pennsylvania attorney general, bankers, and credit union parties have agreed to postpone a hearing on uniformity of taxation pending the outcome of the community charter appeal currently in the state Supreme Court (Life is a Highway Sept. 10). No timeframe was given during the status conference for resolution of the community charter matters. Pennsylvania Commonwealth Court Judge Dante Pelligrini had scheduled the status conference Tuesday with legal counsel for all parties in the case. The conference's purpose was to discuss moving the case forward, said the Pennsylvania Credit Union Association (PCUA). The case stems from a lawsuit by bankers involving the applications for community charters by Trumark Financial CU, based in Trevose, and Freedom CU, based in Warminster (News Now Aug. 15). At issue is whether credit unions and banks are sufficiently distinguishable to merit different tax treatment consistent with the Pennsylvania Constitution. A provision in the state constitution states that like entities should be taxed in a like manner, Rick Wargo, PCUA general counsel, told News Now last month. Three credit unions, the PCUA and the state Department of Banking filed briefs Aug. 6 regarding community charter lawsuits by the Pennsylvania Bankers Association (PBA) (News Now Aug. 12). Corry Jamestown CU, Corry; Freedom CU, Philadelphia; and TruMark Financial CU, Trevose, filed the briefs in support of the banking department's approval of their community charter changes (Life is a Highway Aug. 11). The approval came in December, and PBA appealed the decision earlier this year. One of the bankers' issues is community charters and what procedures the banking department must follow when reviewing a credit union's intent to convert to a community charter. The bankers also contend that the tax-exempt status provision of the Pennsylvania Credit Union Code violates the state constitution.

Connecticut league announces dues discount

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MERIDEN, Conn. (9/11/08)--Affiliated Connecticut Credit Union League credit unions can receive a 5% discount each year on their dues if they commit to the league for two years, the league announced Wednesday. Credit unions may also pay the full dues while electing up to 5% to be placed in the league’s Small Credit Union Support Fund. The program will help the league budget on a longer-term basis, the league said. The league is excited to “reward credit union for their commitment...while at the same time, being able to provide a funding mechanism for [Small Credit Union Support Fund],” said Anthony Emerson, league president/CEO. The program will begin with dues notices effective January 2009 through Dec. 31, 2010.

Traveling billboards a bonus for 17 CU employees

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WEST MIFFLIN, Pa. (9/11/08)--United Community FCU, West Mifflin, Pa., is going the extra mile to market itself to potential members.
Click to view larger imageUnited Community FCU, West Mifflin, Pa., recently gave each of its 17 employees 2009 Chevrolet HHRs to drive for three years. The cars will market the credit union. From left are: Joyce Anderson, United Community executive vice president, and Michael Pastirik, CEO. (Photo provided by United Community CU)
On Thursday, the credit union handed over keys to new Chevrolet HHRs branded with the United Community FCU logo to all 17 of its employees. The cars will be driven by the employees for three years to market the credit union. “The employees couldn’t believe it,” Michael Pastirik, United Community FCU CEO, told News Now. “They’re as excited as we are.” The goal of the program is two-fold--to attract new accounts and loans, he said. On the back of each car is a number that cell phone users can text and receive the credit union’s phone number and address. United Community will place the numbers in a database and market to those who texted the credit union, Pastirik said. “We’ve had 13 messages since Thursday,” he added. Sixteen of the cars are white, and one is silver. Pastirik said the credit union made sure the logo design looked sharp, so employees wouldn’t feel like they were driving a “clown car.” The credit union is covering the costs for each car--employees are only responsible for gas. As an added incentive, employees will receive cash bonuses if they talk to potential members who end up coming in to sign up for membership. The cars were financed with half of United Community FCU’s marketing budget. The credit union had primarily advertised through direct mail and print ads. “We’ll still do some ads and mail, but about half as much,” Pastirik said. The credit union’s board was “100% behind us,” he said. He emphasized that financing the cars will not affect members’ dividends. Pastirik has been told by some in the industry that the money to buy the cars should be given back to members, but “if we don’t attract new people, we won’t be here,” he said. “We need to have people know who we are.” United Community FCU’s 29-year-old chief financial officer came up with the idea to use the cars for marketing. “He came up with a great idea to attract young people,” Pastirik said. A woman from Pittsburgh recently contacted United Community saying that she’d heard about the marketing program and was so impressed that she was planning to switch her account to the credit union from another institution. “She said, ‘I want to deal with someone who treats their employees so well,’” Pastirik said. “It was refreshing.”

Bigby appointed to NASCUS CU exec council

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ARLINGTON, Va. (9/11/08)--The National Association of State Credit Union Supervisors (NASCUS) announced that Ed Bigby, president/CEO of Norbel CU in Fort Collins, Colo., will serve as a director on the NASCUS Credit Union Executive Council. The announcement was made by NASCUS Credit Union Advisory Council Chairman Mendell Thompson of America's Christian CU, Glendora, Calif. Bigby, a 40-year veteran of the financial services industry, has served in the credit union industry since the mid 1970s. He is a NASCUS committee member and the NASCUS state liaison for Colorado. He also has served on the boards of the Credit Union Association of Colorado and the Credit Union Executives Society. He will fill the unexpired term vacated by Rick Schmidtke, Harborstone CU, Tacoma, Wash., who is retiring. Bigby's term began Monday and will run until September 2009. The NASCUS Credit Union Advisory Council is governed by the Executive Council, a group of 12 directors who are credit union executives from around the country.

Thousands line up for gas subsidized by Billings FCU

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BILLINGS, Mont. (9/11/08)--Billings (Mont.) FCU subsidized a $1.81-per gallon gas sale Aug. 29 at a Kwik Trip gas station in Billings that drew thousands of people.
Click to view larger image Billings (Mont.) FCU staff pumped gas on the Friday before Labor Day weekend for four hours at a discounted rate of $1.81 per gallon--subsidized by the credit union--for thousands of people who lined up in their cars for the promotion. (Photo provided by Billings FCU)
The fuel price in that market was about $3.88 per gallon, so customers saved about $2 per gallon for up to 18 gallons of gas per vehicle sold between 6 a.m. and 10 a.m. that day. Thousands of people lined up--some starting at midnight--for the promotion ( Aug. 30). “We wanted to offer a promotion that helped spread the word about credit unions, and invest in the community we live and work in every day,” Kevin Rookhuizen, BFCU vice president of sales and marketing, told News Now. “Gas prices are a hot topic, so we thought we would supplement the high fuel prices with a discounted fuel day on the Friday before Labor Day weekend,” he said. “We marketed this to our members and the community as a whole,” he added. “Our sales team was onsite pumping fuel, washing windows, handing out bags of goodies to participants that included gauges, pens, BFCU information and feature product offers.” BFCU staff wore bright green shirts with “Pit Crew” stamped on the back. “It was neat to have the privilege to serve the community in a way that doesn’t happen every day,” Rookhuizen said. BFCU has about $70 million in assets.

IBankrateI CUs help young savers during credit crunch

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NEW YORK (9/11/08)--Credit unions can help during the credit crunch, but they are often overlooked by Americans--especially young adults--who need help saving money, according to Young adults often have a hard time getting credit because they don’t have a credit history or their incomes are low, Mike Schenk, vice president of economics and statistics at the Credit Union National Association (CUNA), told Bankrate (Sept. 10). The credit crisis has caused many lenders to tighten their standards, making it more difficult for young people to obtain credit, he added. Credit unions looking to attract young adults should note that young adults are interested in online banking, mobile banking, and ATM conveniences, Josh Jones, CUNA manager of young adult programs, told Bankrate. About 68% of credit unions offer online banking and 49% offer electronic bill pay. Many credit unions also belong to a network with surcharge-free ATMs and are less likely to charge for other institutions’ ATM services, Jones added. CUNA’s 2007 Credit Union Profile Report indicate that 99% of credit unions offer certificates of deposit, checking, auto loans and individual retirement accounts, the article said. Credit unions have lower rates on loans, mortgages and credit cards, and pay higher rates of return on savings accounts. On average, credit union members nationwide save $10.9 billion per year--which is about $126 per person or $239 per household, Bankrate said.

Merger to result in Australias second-largest CU

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MELBOURNE, Australia (9/11/08)--Austral CU, Melbourne, Australia, will merge with South Australian Savings and Loans credit union--making the country’s second-largest credit union. The combined credit union will have nearly $3.5 billion in assets. Austral has four branches and six agencies. Savings and Loans, which has 39 branches, has three branches in Melbourne (The Advertiser Sept. 9). Savings and Loans had $10.9 million in net profits this month. Austral CU declared a profit of $1.1 million last year on interest revenue of $11.9 million, the newspaper said.

New York governor signs mortgage tax exemption law

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ALBANY, N.Y. (9/11/08)--New York Gov. David A. Paterson signed a law exempting state charters from a mortgage tax, according to the Credit Union Association of New York. He signed the Special Additional Mortgage Recording Tax (SAMRT) bill at the end of last week. One of a package of 66 bills signed, the bill (Ch. 522) exempts state-chartered credit unions from the special addition mortgage recording tax beginning in 2010. The new law levels the field with their federal credit unions, said the association. Effective immediately, the law also allows federal credit unions choosing to convert to a state charter to retain their exemption from the tax. "This pro-credit union legislation is a major victory for New York credit unions," said William J. Mellin, president/CEO of the association. "The signing of this bill was the result of a great team effort by the association and our member credit unions who lobbied heavily for this charter parity measure." He noted the law remedies a charter disparity and enhances the dual chartering system in the state for every credit union. "It is clear that our state's elected leadership recognize that credit unions have always granted affordable and responsible home loans and that, by making their mortgages more affordable, they are allowing state charters to do more for their members and their communities." Sponsors of the legislation were Assemblywoman and Speaker Pro Tempore Aurelia Greene (D-Metropolitan) and Sen. Hugh Farley (R-Capital/Adirondack), chair of the Banks Committee. The legislation was passed by both the Senate and the Assembly in June.

CUNA notes phishing peaks and valleys in article

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MADISON, Wis. (9/10/08)--Credit unions and banks have seen an increase in the number of fraudulent phone calls, text messages and e-mail phishing scams, the Credit Union National Association (CUNA) told the Utica, N.Y. Observer-Dispatch (Sept. 7). Nationwide, phishing is kind of happening in peaks and valleys, but it is prevalent," said Dorothy Steffens, vice president of Web services at CUNA, in an article entitled "Consumer warning: 'Phishing' for your financial information." She noted some periods where phishing is higher, "such as tax time, when there are a lot more fraudulent e-mails trying to get people to click on a link." Scams also begin when college students return to school and use their credit and debit cards, she said. Consumers, when contacted by the scammers, tend to believe they are being contacted by a reliable source and they begin offering their personal data, she added. Phishing has been around for nearly four years, and con artists have moved from e-mail phishing to voice-mail "vishing, Steffens said. She provided tips for consumers to guard their information. To review them, use the resource link.

Survey 75 of consumers would use mobile banking

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BROOKFIELD, Wis. (9/10/08)--Seventy-five percent of consumers surveyed say they would consider using mobile banking services if offered. That's a dramatic increase from the 49% who said so in March 2006, says a new study commissioned by Fiserv Inc. "This research shows that consumer adoption of mobile banking services is poised for potential rapid growth," said Bob Homer, vice president of product management for Fiserv Electronic Banking Services. Heavy users of cell phones and other mobile devices--and younger consumers--had a greater need for mobile banking services that provide control over their finances and instant access to balance information (Business Wire Sept. 9). Among those 21 to 34 years old, 83% indicated they'd consider using mobile banking services if available. That compares with 75% among overall survey respondents. The most popular mobile banking activities among younger consumers include checking balances, locating an ATM or branch, and receiving and paying household bills. Other findings:
* Adoption of mobile banking and payment services is growing. In 2006, those using a cell phone for financial activities was non-existent. In 2008, 23% said they use their cell phone or other mobile device to check their account and credit card balances or contact customer service at a financial institution. * Among those who haven't adopted mobile banking yet, 72% said security was their top concern. However, 82% would sign up with their financial institution for mobile security text messages alerting them of password and other access changes, and 79% would sign up for account balance alerts. * Cost of services was a top concern for 48% of those surveyed who haven't adopted mobile banking. Consumers 35 and younger were less bothered about barriers such as not knowing how the services work and losing the paper trail. The under-34 market is a primary potential target for marketing campaigns launching mobile financial services, said Fiserv.
The survey was conducted in April for Fiserv by MQA Research and was based on findings from 1,007 U.S. consumers at least 18 years or older, who use a cell phone at least once each week.

CUbank plan merger league to discuss other options

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AUGUSTA, Maine (9/10/08)--KV FCU and Kennebec Savings Bank, both based in Augusta, Maine, Monday announced they are discussing a proposal to merge the credit union into the bank. The Maine Credit Union League is taking action to discuss other viable options first. "The Maine Credit Union League and our member credit unions are committed to the credit union charter and remain resolute in our belief that the credit union charter provides by far the best option for credit union members," John Murphy, president of the league, told News Now Tuesday. The league board Tuesday "unanimously voted to establish communications with KV FCU officials to consider other viable options available to the credit union and its membership," he said. "A meeting for this purpose has been scheduled for later this week, and it will determine the future direction we will take in this process," Murphy explained. The merger proposal was announced by Beverly W. Beaucage, president/CEO of KV FCU, and Mark L. Johnston, president/CEO of the bank. KV FCU's board is scheduled to vote Oct. 14 on a proposal to convert to a federal mutual savings bank. Immediately following the conversion, the credit union would merge into the bank, said the credit union's website. Kennebec Savings Bank is currently a state-chartered mutual savings bank; however, at the time of a merger it will have converted to a federal savings bank charter. The announcement begins a process of scrutiny, legal postings and comment periods, with votes by the directors and members of the credit union, the trustees and corporators of the bank, and regulators. The credit union noted that the conversion and merger would significantly expand its capacity to meet the current and future needs of members. "We've continued to grow steadily since 1962 while maintaining a strong capital base and steadfast focus on member service," said Beaucage in the press release. "Our board determined that the long-term goal for KV was to build and maintain a strong presence in the Kennebec Valley offering our members a wide variety of financial services," she said. To accomplish this, "it makes sense to consider combining our efforts with a local institution that has similar values." KV Board Chair Richard Tardiff said, "A union like this could allow us to capitalize on each others' strengths to make the best financial institution going forward." Kennebec Savings Bank was chartered in 1870, making it one of the oldest mutual savings banks in the state. KV FCU was chartered in 1962 as St. Augustine's FCU. Its county charter allows for membership in two counties--Kennebec and Somerset. It has more than $51 million in assets. Both institutions are familiar with the merger process, they said. KV acquired Messalonskee Regional FCU in 1992 and Kennebec Health Systems FCU in 1993. The bank combined with Waterville Savings and Loan in 1995. "With all the changes happening in the financial services industry, this union of two longstanding and respected local financial institutions could provide the greatest opportunity for improved services and choice for residents in the Greater Kennebec Valley," said Johnston. If the credit union board approves the conversion/merger proposal, the proposal will be submitted to KV FCU's membership for a vote following a notice period of at least 90 days, the credit union said.

Teen credit tied to GPA quiz parent consent

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SWARTZ CREEK, Mich. (9/10/08)--Financial Plus FCU, Flint, Mich., is offering youth credit union accounts with cards based on grade point averages (GPAs), scores on a financial literacy quiz, and parental consent. The program, Fine Tune$, offers youth ages 16 to 18 the opportunity to open a savings account, free checking account, and have a Visa debit card and credit card with a minimum balance of $200 and maximum balance of $500. Annual percentage rate is 5%. Upon receiving the account, students will receive gift cards for free music downloads. “The response has been phenomenal,” Raul Alvarez, Financial Plus marketing director, told News Now. To qualify for Fine Tune$, students must complete a 45-minute Powerpoint-based “Dollars to Downloads” training course through the credit union’s website, have a 2.5 (GPA), and parental consent. “Dollars to Downloads” teaches students how to set savings and spending goals, learn money management and credit score facts, how to write checks and keep a check register, and how debit and credit cards work. The questions for the test are pulled from the course material. “We want to make sure teens understand the basics,” Alvarez said. If the students fail the test, they can re-take it until they pass. If they fail, they are still eligible to open a savings account. Financial Plus “doesn’t give out credit cards--youth have to earn them,” Alvarez said. “The innovative part is the educational piece,” he said. “It’s an added responsibility they can earn--it’s not automatic.” For the cards, the credit union uses a student’s GPA like a credit score. “It’s a good indicator,” Jeannette Van Dusen, Financial Plus teller operations manager, told News Now. “Kids under 18 don’t have a credit score, and we want to show them how important it is [to have a good score.]” Parents also must sign a consent form for students to receive a credit card. When students receive their first credit card statements, they are invited to the credit union to talk with their personal financial representatives about how to read the statements. “We’re finding that kids love fast food--especially that fast food restaurants take Visa,” he added. Financial Plus sends out text message reminders to students about the statements, and can also send out messages if a student’s account drops below a certain limit. “They’re notified immediately if something happens to their account,” Van Dusen said. Financial Plus also is appealing to students through music by allowing them to receive more free downloads referring friends. “Kids are defined by their music,” Alvarez said. “We’re trying to make sure we’re staying with them.” Alvarez recently went to a local school, Swartz Creek High school, to promote FineTune$ during orientation. The credit union handed out Krispy Kreme doughnuts to students and talked to them about the program. Financial Plus has received some comments about the risks involved with giving teens credit cards. But Alvarez said the teens are bombarded with credit cards at college campuses, so “we want to make sure they’re ready for that,” he said. The credit union also will transition youth members into full-fledged memberships once they turn 18, he added. The credit union partners with Swartz Creek High School to teach financial literacy and recently installed an ATM in the school’s cafeteria. The credit union also expanded its charter to two other counties, and expects FineTune$ and its financial literacy programs to grow, Alvarez said. “The parent, financial representative [from Financial Plus] and the teen--those pieces work well together,” he added.

ALM forum notes shifts in market member dynamics

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DALLAS (9/10/08)--Credit unions need to be unique and bring value to their members, according to one of several speakers at the ALM First Financial Advisors Financial Forum Aug. 11-13. The forum presented speakers who discussed the current economic state and the dynamics of credit union members. Diana Dykstra, president/CEO, San Francisco Firefighters CU, said banks have “wised up” and taken a cue from credit unions that they need to focus on their customers. “Customer intimacy doesn’t just belong to credit unions anymore,” she told the group. “We can’t just be marginally better. The world has changed on us--and we must pay attention and be willing to shift with it.” On average, 20% of a credit union’s members will generate 150% of its earnings, said Joseph Prunty, founder/president of CorePROFIT Solutions Inc. “These members are your franchise--they add value every day. No credit union today should not know who its members are. If members leave, it is very hard and expensive to replace them,” he said. Other highlights addressed included:
* Credit unions’ survival in the current market woes. ALM First partner Tom Manley said the Bear Stearns failure has set in place “different mechanisms and oversight” by the Federal Reserve. “How this will impact credit unions, I don’t know. But credit unions have managed very well, with very few realized losses. We’re an industry that doesn’t have nearly as many problems as the rest of the financial community,” he said. * Consumer confidence, which has plunged to a 40-year low. People fear that their income is declining, said Chris Low, chief economist, FTN Financial. “Not just unemployment, but underemployment, where they work below their skill and income levels. People aren’t finding jobs with income growth,” he added. * Shifts in consumer wealth. Wealth isn’t linked to consumer saving, said Torsten Slok, director, US economics for Deutsche Bank Securities. “U.S. households have just started to save again--a little bit, at 2%--but we have to save more,” headded.
The forum also featured a panel of credit union leaders addressing the challenges, opportunities and risks that credit unions face. New Jersey Credit Union League President/CEO Paul Gentile moderated the discussion. The panel presentation is free to credit union professionals through ALM First’s website (use the resource link). Panelists included:
* Jim Blaine, president/CEO, State Employees’ CU, Raleigh, N.C.; * Dykstra; and * John Tippets, retired Dallas-based American Airlines FCU president/CEO.

TraceSecurity 95 of FIs tested still vulnerable to theft

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BATON ROUGE, La. (9/10/08)--About 95% of U.S. financial institutions’ sensitive data, including account records and social security numbers, could have been robbed in 30 minutes or less on average, said TraceSecurity, a CUNA Strategic Services provider. Between 2003 and 2008, TraceSecurity’s engineering team compromised the security of 1,000 financial institutions. Had the attempts been legitimate, the personal identity of tens of millions of consumers could have been stolen, the company said. The statistics are based on a group of TraceSecurity’s clients, including credit unions, with asset sizes ranging up to $2.7 billion in 48 states. “I’ve been able to bypass security policies, procedures and technology of any bank or credit union where I’ve performed social engineering engagements 100% of the time,” said Jim Stickley, TraceSecurity co-founder and chief technology officer. The tests were based on penetration testing, remote social engineering and onsite social engineering. Penetration testing employs hacking into a company’s network through the Internet to check for vulnerabilities. Social Engineering tests include phishing, pharming, pre-text calling and onsite impersonation of a third party. For onsite social engineering tests, TraceSecurity engineers disguise themselves as fire marshals or pest inspectors. They gain entry 95% of the time to areas in financial institutions with sensitive data, the company said. Backup tapes storing sensitive data were the easiest target to steal while being undetected by employees. Other items stolen in the test heists include loan applications, laptops, cell phones, personal digital assistants, and keyboard data. “It takes only one branch location for all [members’] sensitive data to be at risk, and recent data breaches have shown these losses can amount to billions of dollars--a huge cost for what’s usually a small, avoidable error,” Stickley said. TraceSecurity provides security risk and compliance solutions.

Economy is topic of two CUNA webinars

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MADISON, Wis. (9/10/08)--Two Credit Union National Association (CUNA) webinars scheduled during the fourth quarter will focus on the economy. “Economic Update” on Oct. 16 will analyze the global economy’s impact on the U.S. economy and future trends. It also will evaluate credit union balance sheets and earning performance, as well as savings and loan activity trends, to help with the forecasting process. On Oct. 20, “Economic Forecast for Collectors” will help participants better understand how the economy is impacting the consumer’s ability to meet financial obligations. The webinar will discuss trends driving loan delinquencies and charge-offs and how the Federal Reserve is helping financial institutions deal with heightened liquidity concerns. Other webinars highlighted during the fourth quarter include:
* “Boost Your Bottom Line Through Financial Education,” Dec. 5, which offers research and case studies that demonstrate how financial education can be used to help credit unions build effective sales and service cultures, and attract, train, and retain employees and members; * “Credit Union Savings Bonds,” Nov. 18 and 20, which explains the features, benefits and processing procedures for U.S. Savings Bonds. It also explores TreasuryDirect, along with additional resource materials and Internet tools; and * “Your Disaster Recovery Plan and Your IT Department,” Dec. 9, offered in cooperation with the CUNA Technology Council. It will discuss the role a credit union’s information technology department plays in the planning process.
CUNA will offer about 45 webinars will take place during the fourth quarter on finance and economics; human resources and training; security; lending; management and leadership; boards and volunteers; marketing and business development; operations, sales and service; and regulatory compliance. Archived versions of many recent webinars are also available. For more information, use the links.

Minnesota senator addresses MnCUN fall conference

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BRAINERD, Minn. (9/10/08)--Minnesota Sen. Tom Bakk (DFL-Cook) attended the Minnesota Credit Union Network's(MnCUN) Fall Conference, held Sept. 5-7, and spoke to attendees Saturday evening. Bakk, who chairs the state Senate Taxes Committee, is a strong supporter of credit unions and has been a frequent guest at chapter meetings and other MnCUN events, said the network.
Minnesota Sen. Tom Bakk tells attendees at the Minnesota Credit Union Network's Fall Conference to get involved in the upcoming elections. (Photo provided by the Minnesota Credit Union Network)
He is a member of the Virginia Co-op CU, Va., Minn. He discussed workforce development, unemployment and future challenges facing Minnesota, as well as credit unions' involvement in political advocacy. Bakk challenged credit unions to get involved in the November elections and gave "homework" during this election cycle. "I encourage you to introduce yourself to the candidates [running for election]--nothing is more valuable to your organizations than developing these relationships," he said. He acknowledged credit unions' high level of involvement in this area and their participation in MnCUN's annual Credit Union Day at the Capitol. "Thank you for the time you put in to make your credit unions a better place," he said. Bakk also informed the audience of his intention to run for governor in 2010. MnCUN President/CEO Mark D. Cummins said the network appreciated Bakk's presence and support. More than 300 individuals from 49 credit unions, and 65 vendors representing 32 service organizations attended the conference.

CU System briefs (09/09/2008)

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* LENEXA, Kan. (9/10/08)--Members of two Kansas credit unions voted this week in favor of merging. The merger--between Free State CU, a $9 million asset credit union in Lawrence, and the $215 million asset Credit Union of Johnson County (CUJC), Lenexa--is expected to be concluded Sept. 15. Regulators had already given their approval. Free State has nearly 4,500 members served by two branches in Lawrence and one in Lenexa that it shares with CUJC. Michael Amick, Free State CU chairman, said it chose CUJC as its merger partner because the two share a member-focused approach to business. "This will give us a broader, stronger financial footing from which to operate while offering our members immediate opportunities for greater service and savings," he said. Dr. Jack Chalender, chairman of CUJC, said Free State's two Lawrence branches will remain open. Data integration of the two credit unions' core processors is expected to be complete by November … * DES MOINES, Iowa (9/10/08)--The Iowa Credit Union League (ICUL) announced the promotion of Murray Williams to chief operating officer (COO). During the past 12 years, Williams has worked in various leadership capacities for the league, including as director of public affairs and strategic alliances, and most recently as vice president. Williams was instrumental in developing the league's newer operating companies, such as Community Business Lenders and Coopera Consulting. He has led legislative grassroots and media efforts and helped ICUL fully integrate its online communications. As COO, Williams will manage the league's operations while overseeing dues and fee-based services, and providing integration with ICUL operating companies and partners … * CEDAR FALLS, Iowa (9/10/08)--Marshall Dean McKinney, 70, died at a hospice center in Springdale, Ark., Aug. 20. He served as manager of the University of Northern Iowa CU, Cedar Falls, Iowa, from 1974 until his retirement in 2002. Survivors include a daughter, a son, two granddaughters, two sisters, and a longtime companion (Waterloo Courier Sept. 8) … * WILKES-BARRE, Pa. (9/10/08)--Donald R. Schwartz, past president of Bellco FCU in Wyomissing, Pa., died at his home Friday afternoon. He was 79. He is survived by his wife; four children; two granddaughters and one sister. Funeral services are today at 10 a.m. in Hazleton, Pa. (The Wilkes-Barre Times Leader Sept. 8) …

Weaker Ikes projected path includes Texas Louisiana

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MADISON, Wis. (9/9/08)--Residents and credit unions in Texas and Louisiana were urged not to get too complacent now that Hurricane Ike has weakened from a Category 4 to a Category 1 hurricane. Ike, whose winds topped 135 mph as a Category 4 and whose sea surge reached five stories high when it hit the Turks and Caicos Islands, slowed to 80 mph winds as a Category 1 Monday. It weakened as it barreled through Cuba Monday but was expected to regain some strength after it enters the warm Gulf of Mexico. In its projected path: The entire coast of Texas and as far east as Lake Charles, La. Landfall is projected to be Friday or Saturday. Key cities along the Texas coast include Corpus Christi, which has 15 credit unions and branches of four others; Galveston, which has five credit unions and a branch of a sixth credit union; Brownsville, near the Mexican border, has three credit unions; and Beaumont to the north, with 10 credit unions as well as branches from seven others. Houston, while not on the coast, is inland from Galveston. Houston, excluding its suburbs, has 84 credit unions and countless branches of credit unions headquartered elsewhere. The Texas Credit Union League has a Texas Disaster preparation website with information for credit unions (use the resource link). The Louisiana area could be in the volatile north east circle of the outerbands of the hurricane. Louisiana Gov. Bobby Jindal noted Ike could impact the coastal parishes of the state with hurricane strength winds, wave surges, high tides, torrential rain and tornado activity. ( Sept. 8). Meanwhile, credit unions in the Florida Keys dodged the brunt of Ike. At least one credit union there had, for the second time in three weeks, blasted an emergency e-mail notice via DigitalMailer's crisis management system, to members with information about the credit union's emergency plans. The Keys' mandatory evacuation order expired Monday.

Popularity of new auto loan promo a surprise says CU

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TEMPE, Ariz. (9/9/08)--Tempe (Ariz.) Schools CU’s western-themed “WANTED” auto loan promotion drew nearly 30 applications from members and non-members to switch their auto loans to the credit union in the first two days of the promotion. “I was quite surprised at the current popularity of this new program,” said David Rindone, Tempe Schools director of marketing. Because of the program’s success, the credit union is looking to launch the program again next summer. The credit union promised applicants a reward of $100 cash and a 2% discount off their current rate if they applied to move their loan to the credit union. Members also could choose to skip loan payments for the first 60 days. “I think our timing was great as people were looking to streamline their budgets,” Rindone said. Credit union employees also donned cowboy and western gear and wore sheriff’s badges to promote the event. “We are always looking for new ways to attract members to the credit union,” Rindone said. Members had to qualify for the promotion based on normal underwriting guidelines and the floor rate on the loans was at 5.99%, the credit union said. Tempe Schools has $160 million in assets.

Sunset commission wants more financial info

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AUSTIN, Texas (9/9/08)--Among the recommendations made recently by the Texas Sunset Review Commission was a proposal for legislation that would require credit unions to file separate tax returns. Such a proposal would present an increased burden on the state's credit unions, says the Texas Credit Union League. Currently the information for about 220 state chartered credit unions is combined into a single tax form filing (Star-Telegram Sept. 7). The commission recently recommended a bill to require them to fill out separate Form 990s with the Internal Revenue Service (IRS). Filing separate returns would make it easier for members to study their institution's bottom line, assess its financial risks or learn how much top officers are paid, the commission said. However, league President/CEO Dick Ensweiler told the Star-Telegram that the proposal would require more accountants to file the separate forms. Most credit unions are small and don't have such experts on staff, he said, adding they shouldn't have to take on more regulatory burden. The news report did not address the fact that members can get financial information from credit unions' annual reports and from the National Credit Union Administration, Winter D. Prosapio, league advocacy-communications director, told News Now. "The story makes it sound as if there isn't any visibility for members as to the health of their credit union," she said. With the exception of specific executive compensation, a new aspect of the revised 990 forms, "that's simply not the case," she said. Harold Feeney, commissioner of the Credit Union Department, told the newspaper that the department is supportive of the Sunset Commission's recommendations. The commission recommended that credit unions should submit to members annual updates of finances, inform members regularly that they can see documents about finances and management, and publicize that members can file complaints. The public would not have access to credit union examination results. The report also recommended more authority for Feeney to pursue credit union fraud.

Do better job of touting difference CU execs told

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FARMERS BRANCH, Texas (9/9/08)--Credit unions need to do a better job of touting their difference, Ron Galloway, author and speaker, told credit union leaders at the Texas Credit Union League’s Leadership Conference and Visionary Expo Friday. Credit unions have proven themselves to be the most responsible financial institutions since 1930, he said. “You have a fabulous story to tell, but you aren’t getting your message out there. People don’t know about you,” he added (LoneStar Leaguer Sept. 8). Tom Dorety, CEO of Suncoast Schools FCU, Tampa, and chairman of the Credit Union National Association, said credit unions need to emphasize their uniqueness. Chuck Wilson, managing principal, Banking Industry Group Inc., said everyone at credit unions--from front-line staff to management--can spread that message. He also noted that if directors and employees can’t communicate to membership the reasons why the credit union is different, members don’t have an incentive to stay. “Your board of directors and employees must continuously and actively find ways to tell your story and help your members,” he added. “Is your organization committed to providing the level of service that sets you apart from the competition?” he asked. He followed up with other questions:
* Does the credit union have a definition of quality member service that all employees know and understand? * Is its quality standards practiced by each department in the credit union? * Is there planned, ongoing measurement of quality standards and timely feedback to employees about the results? and * Is the performance of the quality standards directly linked to the pay of each individual employee through the credit union’s performance appraisal process?
Credit unions may want to re-evaluate whether they are committed to providing the level of service that will set it apart from the competition, he concluded.

Illinois CUs agencies offer 100.5 million in student aid

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CHICAGO (9/8/08)--Eight Illinois credit unions have teamed with two state agencies to provide $100.5 million in financial aid for as many as 20,000 college students in a new state program. Credit unions are investing in the securities issued by the Illinois Student Assistance Commission (ISAC), filling gaps created by other private lenders who stopped providing financial support during the economy's credit crunch. "This financing package will enable thousands of students to attend college this year, knowing that they can pay their tuition," said Gov. Rod Blagojevich (Chicago Tribune Sept. 8). "We are pleased to team up with ISAC and back its efforts to help students get a quality education," said Dan Plauda, president/CEO of the Illinois Credit Union League (ICUL). "Earning a college diploma is crucial and on top of all of the other pressures of attending college, students should not have to additionally worry about whether or not their loan will fall through." Andy Davis, executive director of ISAC, learned of a similar program in North Carolina and contacted the league, which helped broker a deal with the eight credit unions. After meeting with Davis, ICUL determined that investing in the bonds would be permissible under applicable provisions of the Illinois Credit Union Act. The Illinois Department of Financial and Professional Regulation, the state agency that regulates credit unions, concurred. "The credit unions," Davis told the Chicago Sun-Times (Sept. 7), "really stepped up." Credit unions will provide Stafford loans ranging from $3,500 to $20,000, carrying an interest rate of between 6% 6.8% compared with the 18% through private loans, and backed by the federal government. Credit unions were approached after federal legislation cut subsidies that banks receive when they provide funds for lending to students. Banks are wary of making loans to students, who often have no collateral or jobs. The credit crunch led to announcements by state student loan agencies in Massachusetts, Minnesota and Pennsylvania that they would not loan funds this year. Credit unions involved in the Illinois program include:
* Alliant CU, Chicago; * Baxter CU, Vernon Hills; * Citizens Equity First CU, Peoria; * Corporate American Family CU, Elgin; * Credit Union 1, Rantoul; * I.H. Mississippi Valley CU, Moline; * Motorola CU, Schaumburg; and * Scott CU, Collinsville.

Massachusetts league elects officers

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MARLBOROUGH, Mass. (9/9/08)--The Massachusetts Credit Union League board of directors elected a new slate of officers that will serve for two years (Values and Visions Sept. 5). New officers include:
* Chairman Robert M. Cashman, Metro CU, Chelsea; * First Vice Chairman John B. Winne, Boston Firefighters CU; * Second Vice Chairman C. David Surface, St. Jean’s CU, Lynn; * Treasurer David S. Plantier, MassMutual FCU, Springfield; and * Clerk John M. Doolin, Workers’ CU, Fitchburg.

PCUA votes in modest dues increase for large CUs

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HARRISBURG, Pa. (9/9/08)--The Pennsylvania Credit Union Association board of directors voted to change the dues schedule for credit unions with $100 million in assets or more. The increase will be modest, said Jim McCormack, association president/CEO. “These credit unions benefit the most from the association’s advocacy spending in which upwards of 94% of association dues are spent,” he added. The board also voted to post consolidated financial statements for the association and its credit union service organization, Pacul Services Inc., on its website. The statements will be posted shortly (Life is a Highway Sept. 8). The board also approved a strategic business partnership with Integrate Compliance Solutions, and approved Jeff DeBree, CEO, Penn East FCU, Scranton, to fill the remaining term of the late Paul Santoski on the Pennsylvania Credit Union Foundation board.

iBelong campaign extended for two years

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HARRISBURG, Pa. (9/9/08)--The Pennsylvania Credit Union Association (PCUA) board of directors voted unanimously Sept. 5 to extend the iBelong campaign for two more years. iBelong is an advocacy marketing campaign designed to increase awareness about credit unions. It was launched last year by the PCUA and includes television advertisements leading viewers to iBelong’s website (News Now June 18, 2007). The board approved the recommendation from the Advocacy/Marketing Task Force to continue the campaign. The vote took place at the Fall Leadership Conference (Life is a Highway Sept. 8). For more information, use the link.

CU staffer helps get money for water to El Salvador

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CORVALLIS, Ore. (9/9/08)--A staffer at OSU FCU, Corvallis, Ore., who told a member that "my job is to serve, not turn away," didn't know it at the time, but his service has resulted in good drinking water for 100 residents in El Salvador. Andrew Krasney, an employee at the university branch, received kudos from Rob Hess, treasurer of Engineers Without Borders at Oregon State University (OSU), who wrote the credit union a letter of thanks, according to the Credit Union Association of Oregon (Outlook September). Hess had been a member of OSU FCU for about four years and had never needed to use services other than basic savings and checking accounts, he wrote. "However, recently I have had to perform a series of international wire transfers summing to several thousand dollars," Hess said. One transfer "had to be performed within a short time frame, but only after a pending direct deposit showed up in my account, which, unfortunately, would happen when I was out of town. Also, they were unable to find wire transfer information for the receiving bank. Hess said he feared the circumstances would prevent the transfer But Krasney told him, "My job is to serve, not to turn away." The staffer "backed up those words by finding a way to help me get the money where it needed to be when needed," Hess said. Krasney didn't know the money wired was for an international aid project being undertaken by the OSU chapter of Engineers Without Borders. Hess was sending money to El Salvador to buy materials to build a system for fresh, clean, reliable drinking water to more than 100 residents of Las Mercedes and El Naranjito, two rural communities. "Without Andrew's help, this system could not have been implemented, and the residents of Las Mercedes and El Naranjito would remain without a reliable source of good drinking water," the letter said. Hess applauded Krasney "for his hard work and his willing, can-do attitude. Not only am I and the rest of EWB-OSU grateful to him for his help, but so are the 100 or so rural Salvadoran coffee farmers whose daily lives will be improved, in part due to Andrew's good work."

All eyes on Ike CUs return to biz after Hanna

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COLUMBIA, S.C. (9/8/08)--Credit unions near the Lower Florida Keys Sunday were preparing for the outer bands of Hurricane Ike while credit unions along the eastern seaboard from the Carolinas to New England were mopping up for business as usual today after Tropical Storm Hanna moved through Saturday. Hurricane Ike, a Category 4 hurricane, was progressing toward eastern Cuba Sunday and its path--whether over land or over water--will determine if it loses strength and where it turns northward into the Gulf of Mexico. Meanwhile credit unions along the Gulf Coast are watching the hurricane. Its direction today and Tuesday will determine which states go on full alert in a region that experienced Hurricane Gustav just a week ago and is still dealing with power outages from that storm. Credit unions along the eastern seaboard are open for business today after Tropical Storm Hanna failed to strengthen. Still, the storm buffeted some areas of North Carolina with 77 mph winds and several inches of rainfall from South Carolina to New England. Its major impact, besides flash flooding in some areas, was to delay travelers' flights. Early reports from three credit unions at Myrtle Beach and Georgetown, S.C., near where Tropical Storm Hanna went ashore at 3:15 a.m. EDT Saturday, indicated no damage or problems from the storm, the South Carolina Credit Union League reported to News Now Saturday. Those credit unions are Carolina Trust FCU and AVX-MB FCU, both based in Myrtle Beach, and Georgetown Kraft CU, based in Georgetown. All three reported no damage or problems and said they will open today for business as usual. The rash of hurricanes--Fay, Gustav, Hanna and Ike--have prompted credit unions to review their business continuity measures. Just Friday three credit union service organizations (CUSOs)--Financial Service Centers Cooperative Inc. (FSCC), Ongoing Operations (OGO) and Digital Dialogue, a subsidiary of PSCU Financial services--announced they are working together to assist credit unions in disaster planning. "With Hurricanes Hanna and Ike moving in, we are very concerned that as members are being evacuated, they still have access to their credit union accounts," said FSCC President/CEO Sarah Canepa Bang. "There is no question that keeping credit unions up and running during disasters broadens the public's trust of our institutions. Our contribution to disaster recovery allows us to tell the cooperative story to members in a deeply meaningful way."

95 of Louisiana CUs providing cash to members

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HARAHAN, La. (9/8/08)--While Louisiana credit unions are mopping up after last Monday's Hurricane Gustav and keeping an eye out week for Hurricane Ike, their members are receiving service through branches, ATMs or shared branching. According to the Louisiana Credit Union League, 99% of the state's credit unions are providing cash to their members through branches, ATMs or the Louisiana Cooperative Branching Network. Roughly 182 credit unions were in the areas affected by Hurricane Gustav, the National Credit Union Administration (NCUA) said Friday. Gustav made landfall Sept. 1 as a Category 2 hurricane. "There is a small number of credit unions operating from alternative locations," the league said Friday. "We are working to finalize that number." "The primary cause preventing reopening of all credit unions in the affected regions is extensive power outages across Louisiana, the league said. The outages are expected to last in many areas at least until today. "We have been able to put the lessons of the hurricanes of 2005 to work in 2008," said Anne Cochran, league president. The league "initiated our hurricane preparation plan immediately once Hurricane Gustav became a threat to the Louisiana coast. We made contact with each of our credit union members and activiated our TelSpan service to assist our credit unions and provide continuous updates." "Cooperative branching continued to prove its value to Louisiana credit unions and their members throughout the aftermath of Hurricane Gustav," Cochran said. "While credit unions and tens of thousands of Louisiana residents were working to return home, they were able to utilize the features of cooperative branching to manage their finances and obtain needed cash, even if they were in a town hundreds of miles away from their neighborhood. It's another way for credit unions to serve their members through the best and worst of times," Cochran said. "As each day passes, more credit unions are opening and welcoming their members back to their hometowns. We believe that once the region sees power restored, all operations will return to normal," Cochran said, adding she expected that to happen early this week.

CU System briefs (09/06/2008)

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* RIDLEY PARK, Pa. (9/8/08)--A former executive of Boeing Helicopters CU and seven others have been charged in a loan fraud kickback scheme involving $2.54 million. Anthony Forte, a former executive vice president at the Ridley Park, Pa.-based credit union; his brother David Forte; and six others are charged with conspiracy, loan fraud and bank bribery. The charges allege that loans of $20,000 each were given to 127 unqualified loan applicants and that the eight shared $105,413 in kickbacks from borrowers, who were charged as much as $1,000 on the loans. The incidents occurred six years ago. Forte, now president of a local union, could face up to eight years in prison and a fine up to $153.25 million (The Philadelphia Daily News Sept. 5) … * TULSA, Okla. (9/8/08)--Oklahoma Central CU, a $341 million asset credit union based in Tulsa, officially celebrated its merger with Wilserv CU at an open house and branch opening Saturday. The two credit unions announced in November that Wilserv would be merged into the Oklahoma Central. Wilserv was founded as Great Lakes CU in Kansas City, Mo., but moved to Tulsa after a sponsor acquisition. In 1967 it became Williams Employees CU, and in 2004 it changed its name to WilServ. Oklahoma Central is the third largest credit union in the Tulsa area (Tulsa World Sept. 4) … * ANCHORAGE, Alaska (9/8/08)--A man has been sentenced to more than 43 years in prison for robbing a credit union branch and a bank in December 2007. Bernard Miguel Kalilikane, 39, was convicted of robbing branches of Alaska FCU and Northrim Bank. He also was convicted of being a felon in possession of a firearm. A getaway driver, Cynthia Lee Taranto, pleaded guilty earlier to armed credit union robbery and was sentenced to 20 months in prison (Associated Press Newswires Sept. 4) … * MILWAUKEE, Wis. (9/8/08)--William 'Bill' Lange, former CEO of Guardian CU in West Allis, Wis., died Aug. 29 at the age of 68 after a long battle with cancer. Lange was CEO of the $281.7 million asset credit union for 37 years. Services were held Saturday. He is survived by his wife Bobbie, four daughters and 13 grandchildren (The Milwaukee Journal Sentinel Sept. 4) …

Check printer Deluxe to close three plants

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ST. PAUL, Minn. (9/8/08)--Check printer Deluxe Corp. says it will close three manufacturing plants and a call center as a result of the slowing economy. The St. Paul, Minn.-based company also announced Wednesday it had reduced its third-quarter earnings forecast and adjusted its outlook for 2008 to include restructuring and other one-time changes ( and Winston-Salem Journal Sept. 4). It will close plants in Greensboro, N.C.; North Wales, Pa.; and Thorofare, N.J., and its call center in Thorofare. About 570 positions would be terminated by the end of the month. In July Deluxe reported a 9% drop in second-quarter net income. The announcement did not address the increasing trend toward consumers paying bills electronically at the expense of writing checks.

Three leaders honored at Texas leadership conference

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SAN ANTONIO (9/8/08)--Three Texas credit union leaders were honored with awards at the Texas Credit Union League's Leadership Conference & Visionary Expo, held last week in San Antonio (LoneStar Leaguer Sept. 5). Professional of the Year Award went to Michael Brown, president of JSC FCU, Houston, for more than 20 years. During his tenure, the credit union has grown to more than $1 billion assets from $35 million. He is the current president of the Houston Chapter of Credit Unions and past president of the Credit Union Managers Association of Southeast Texas. Named Volunteer of the Year was Joyce Gibson, who has served as board member of City CU, Dallas, since 1984. She has held positions including that of board chair, vice chair, secretary and treasurer, and has chaired numerous committees. Gibson currently chairs the credit union's political action committee. Sherry Roman was presented the Small Credit Union Achiever award. Roman has been with T & P FCU, Big Spring, for 25 years and is active in the Big Spring Chapter of Credit Unions. She has held leadership roles, including president, secretary/treasurer, and TCUL PAC coordinator. She chairs the Small Credit Union Committee.

CUs not in the product business--leadership speaker

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FARMERS BRANCH, Texas (9/8/08)--"We're not in the product business. We are in the financial education and dream fulfillment business," author Barbara Sanfilippo told attendees Thursday at the Texas Credit Union League Leadership Conference & Visionary Expo in San Antonio. Before members will become advocates for credit unions, credit unions must take their focus off selling products and on making an emotional connection with their members, said Sanfilippo, the conference opening speaker (LoneStar Leaguer Sept. 5). Sanfilippo noted a "huge societal problem," with personal debt up and savings down. Credit unions can help elevate members' lives, she said, but many members are "disengaged and disconnected because they don't view their credit union as a key partner who is genuinely interested in their future well-being." Members are focused on their family, their personal vulnerabilities and their aspirations. "That's where our focus should also be," she said. She outlined three emotional drivers of the member relationship most highly correlated with advocacy:
* "My credit union understands my financial goals"; * "Employees provide advice to improve my financial well-being"; and * "My credit union values my business."
Often employees are present physically but have checked out of the job mentally, she said, adding, "Employees should be a walking billboard for your organization." To engage staff, she suggested the credit union:
*Integrate staff into the credit union's brand; * Train them on how to sell to members' dreams and aspirations; * Offer a basic financial literacy class for all staff to help them embrace and practice financial fitness; and * Instill a successful mindset by teaching staff how to dream bigger, create wealth and be better stewards of their money.
"If your employees feel the credit union has played a role in improving their lives, then they will in turn be more inclined to sing your praises," she concluded.

California CUs see slight growth in second quarter

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SACRAMENTO, Calif. (9/8/08)--Credit unions in California experienced slight growth in total assets, loans, shares and capital during the 12-month period ended June 30, announced the California Department of Financial Institutions (DFI). They also experienced higher delinquencies. The state regulator's quarterly report, released Thursday, said assets for credit unions in the state were up 3.5%--to $73.3 billion from the $70.8 billion reported for the same period ended on June 30, 2007. Loans and shares each rose 2.5% during second quarter 2008. Loans were up to $51.8 billion from $50.6 billion, while shares grew to $61.6 billion from $60.1 billion. Members' equity declined 1.7%, to $7.4 billion from $7.5 billion. DFI said this caused credit unions' overall capital to asset ratio to decrease to 10.12% from mid-2007's 10.66%. The allowance for loan losses grew 68%, to $519 million from $309 million. The number of credit unions declined 4.5%--to 193 from 202. Net margin to average assets decreased 12.5% to 3.51% from 4.01% at the end of second quarter 2007. The provision for loan losses more than doubled to $349.6 million from $143.8 million. For the first six months of 2008, net income declined from $225 million in 2007 to a net loss of $132.9 million--a 159% drop of $357.9 million. Delinquent loans for credit unions in the state were up 88.8%--to $531.2 million from $281.3 million, an increase of $249.8 million. How do California's banks compare? State-chartered commercial banks reported $406.7 million in losses--off $1.7 billion or 130.9% from the $1.3 billion in net income they reported for the period in 2007. DFI said this was partly due to a 619.6% increase in loan loss provisions--to $1.2 billion from $163.1 million last year. Loan loss reserves for commercial banks were up 68% but noncurrent loans more than doubled to $3.3 billion from $853.8 million. That caused reserve coverage of noncurrent loans to decrease to 75.60% from 205.53%. Other real estate owned also more than doubled to $255.3 million from $43.1 million. DFI said the banks' assets were up 7.4% to $230.5 billion and loans were up 10.4%. Deposit growth increased 4.3% to $158.7 billion. That caused the loan to deposit ratio to increase to 105.73% from 99.89% for the period in 2007. Equity capital to total asset ratio also declined to 11.69% from 13% for the banks, said the regulator. More information can be found on the financial statistics page of the agency's website. Use the link.

Youth Week theme The Magic of Saving

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MADISON, Wis. (9/8/08)--Based on feedback from more than 700 credit union staff and 50 youth, the winning theme for National Credit Union Youth Week 2009 is “The Magic of Saving.” National Credit Union Youth Week will be celebrated April 19-25, 2009. The voting results are:
* 36%--The Magic of Saving; * 29%--My Credit Union, My Future; * 13%--Be a Savings Sleuth; * 12%--Soar Into Savings; and * 10%--Count on Your Credit Union.
More than half the youth polled picked "The Magic of Saving." Youth age 12 and under liked this theme best. While 26% liked "My Credit Union, My Future," many children age 8 and under didn't understand this theme. The theme will be publicly announced in coming weeks, with a theme design to come in October. The winning theme was suggested by three credit unions. Sharon Dufour at Luso FCU, Ludlow, Mass., first sent in the theme two years ago, giving credit to her then-10-year-old son. Ginger Baehr with Cutting Edge FCU, Milwaukie, Ore., also suggested the theme. This year, David Rice and Carol Summers with Morgantown (W.Va.) AES FCU offered a similar theme, “We'll put the magic back into your savings.” Credit unions looking to start or expand a youth program in 2009 might be interested in the just-published Model Youth Program Guide. The guide is a toolbox of research, resources, samples, and checklists. It includes a sample job description for student-run branch coordinator. For more information, use the link.

Membership growth series Sonoma County Grange CU

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SANTA ROSA, Calif. (9/8/08)--Sonoma County Grange CU CEO Pamela McNatt has worked in the credit union industry for many years, and she embraces ‘old-fashioned’ credit union culture. As such, she wants her credit union to experience “slow, steady growth. I refuse to lose sight of service,” she told News Now. This is the ninth installment of News Now's Membership Growth interviews with fast credit union growers. The series is a part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. It focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA's Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. McNatt moved to the North Bay area of California in January 2007 to work as CEO for Sonoma County Grange CU and get back to her “credit union roots.” When McNatt started at the credit union, she added new computers, a new server and intranet, a website and online banking. She introduced a certificates of deposit program to “bring back the older members” who live off interest income. The program requires $250 minimum balances for children under 18. As a result of the changes, Sonoma increased member accounts by 18% from 2006 to 2007 and added $3 million in assets. It increased its youth agricultural loans to $50,000 this year from $19,000 in 2006. “It’s a big improvement,” McNatt said. The $35 million-asset Sonoma County Grange CU serves an agricultural community--Sonoma County--that offers dairy, organic, berry, flower and apple farms. Sonoma County was originated to serve the people of the Sonoma County granges. The community still has 14 grange halls. The credit union’s original board included members representing each hall. The credit union’s members who were part of the grange are very loyal. “It’s a unique community,” she said. “There’s a lot of camaraderie.” The credit union is growing membership from helping youth. They come to the credit union for loans to buy livestock and “get twice what they put in” once the animals are sold, McNatt said. The children of Sonoma County grew up with farms and are extremely hardworking. Recently, two 17-year-old boys came to Sonoma County for a loan to buy a truck for their farm. One of the boy’s parents was not eligible to co-sign on the loan, so they got a neighbor to help, McNatt said. “We try to help kids establish themselves,” she said. “They’re pretty savvy.” Sonoma doesn’t charge fees by member demand, she said. “We have to be upfront and simple. Do what we say, and say what we do.” Sonoma has six employees and one branch. “Some of us are refugees from working 12-hour days,” she said. “We work 8:30 a.m. to 5 p.m., and we take a half hour for lunch. We come in and help people all day long.” The credit union doesn’t pay top salaries, but it offers an environment of “people helping people” and good benefits. One of the credit union’s challenges is retaining share base with an aging membership. “When Dad passes away, kids don’t keep money with the credit union,” she said. To keep its membership base strong, Sonoma County is getting to know its members. Extra video screen monitors showing who walks in the front door were recently installed so the staff is prepared to greet members when they come in. The credit union also has an electric fireplace in the lobby so members can gather and chat. “It’s cozy for winter,” McNatt said. In the future, Sonoma County would like to:
* Provide seminars about trust accounts; * Offer more scholarships. “We all hit the same kids--the high achievers,” McNatt said. She’d like to blanket the area with the help of other farm agencies to broaden the awards; * Become more technologically compliant. “We’re not in a great location,” she said. “We want to be able to get members to access us online.” * Team up with 4-H, the Farm Bureau, and other agricultural organizations; and * Implement mobile branching. A recreational vehicle could be used to stop at grange halls to serve members.
Sonoma has been approached several times for mergers because of its strong real estate portfolio, but it’s not interested. “We have no desire to be the biggest credit union in town,” McNatt said. “Just the best.” Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at

N.J. league CUs donate for troops comfort

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HIGHSTOWN, N.J. (9/8/08)--The New Jersey Credit Union League and a
Click to view larger imageSoldiers from the 2-113 INF, 50th IBCT, NJ ARNG, prepare to deploy to Iraq from Fort Bliss, Texas. Each soldier received a comfy travel pillow (see packs in foreground) courtesy of Adopt-a-Soldier Platoon's Special Friends at the New Jersey Credit Union League.
group of credit unions in the state donated more 167 boxes of flight pillows to New Jersey National Guard troops as part of their partnership with Adopt-a-Soldier Platoon. The donation of more than $20,000 provided flight pillows to every soldier in the 50th IBCT for the 23-hour flight to Iraq. More than 3,000 departing soldiers received a pillow. The rest of the pillows were given to overseas military hospitals in Iraq, Afghanistan and Germany. Thanks to Unilever, the pillows were delivered to the soldiers in Fort Bliss, Texas, before they departed on their flight, the league said. The deployment is the largest of New Jersey civil troops since World War II. These credit unions participated in the effort:
* Deepwater FCU, Deepwater; * FAA Eastern Region FCU, Clark; * MidState FCU, Carteret; * Paragon FCU, Montvale; * Parlin DuPont FCU, Parlin; * Unilever FCU, Englewood Cliffs; * United Teletech Financial FCU, Tinton Falls; and * West Orange Municipal FCU, West Orange.
Click to view larger imageSoldiers from the 50th IBCT snooze on the long flight to the Middle East and are made more comfortable with pillows donated by the New Jersey Credit Union League and participating member credit unions. (Photos provided by the New Jersey Credit Union League)
"The credit union philosophy is 'people helping people,' and most credit unions are widely involved in the communities they serve," said Candice Areia, league director of marketing and communications and leader of the project. "What the New Jersey Credit Union League has done not only provides comfort for a very long flight, but also shows every single soldier that their well being is important to all the citizens of New Jersey," said Alan Krutchkoff, president, Adopt-a-Soldier Platoon. "It was an incredible donation." For more information on the program, use the links.

CUs on the Tube Ent FCUs podcasts focus on education

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COLORADO SPRINGS, Colo. (9/8/08)--Ent FCU, Colorado Springs, Colo.,
Click to view larger imageJandee Vandenburg (left), Ent FCU’s lending center supervisor and official podcast narrator; Glenn Greenwood (center), Ent’s media design manager and podcast manager; and Jim Moore, Ent’s senior vice president of corporate communication, record a podcast on National Credit Union Share Insurance Fund. The podcast will be available later this month. (Photo provided by Ent FCU)
has launched a free financial education podcast series on its website, The podcasts provide information on avoiding foreclosure and understanding credit unions. Future podcasts on National Credit Union Administration insurance questions and home-buying will be added in the future. The credit union hopes to produce a new podcast each month. More than 230 individuals have downloaded the podcasts, and more than 20 have subscribed to receive them as they become available. Ent has $2.5 million in assets. For more information, use the link.

Triton reopens evacuated facilities in Mississippi

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LONG BEACH, Miss. (9/5/08)--ATM manufacturer Triton Systems of Delaware Inc. reopened its administrative offices and factory Wednesday after evacuations related to Hurricane Gustav closed both facilities in Mississippi. County officials had ordered the evacuation, said Alicia Blanda, spokesperson (ATM&Debit News Sept. 4). Triton is based in Long Beach, Miss. Its manufacturing plant is located 10 miles away. Neither was damaged in the Category 2 hurricane. To prepare for the storm, Triton shipped two truckloads of ATMs to its Memphis, Tenn., facility. That facility was opened after Hurricane Katrina closed the Long Beach offices for two weeks. It serves as a warehouse, repair and training, and technical support center.

Georgia CU Affiliates announces Fall Symposium lineup

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DULUTH, Ga. (9/05/08)--Georgia Credit Union Affiliates (GCUA) has announced the program and speakers for its annual Fall Symposium, Oct. 8-10, at Hilton Head Island, S.C. The event is the first large conference produced through the partnership between GCUA and the Credit Union National Association (CUNA), which provides a series of educational programs to meet the training needs of credit union volunteers, staff and management. The program theme: “Get Smart. Get Focused. Get Real,” encompasses the everyday challenges credit unions face including growth, marketplace relevance, innovation and economic forces. "This year's conference is particularly important," says Mike Mercer, GCUA president/CEO. "With the economy in an unpredictable state and a very important election on the horizon, it’s time for our member credit unions to reconvene and discuss the potential impacts these and other events will have on financial institutions.” The speaker line-up for the symposium features:
* Jeff Post, CEO, CUNA Mutual Group; * Mark Adams, professional communicator; * David Colby, chief economist, CUNA Mutual Group; * Charles Commander (Chuck) Clay, former Georgia state senator and partner/attorney, Brock Clay law firm: * Marlo Foltz--director of blended learning, CUNA Center for Professional Development; * Lois Kitsch, national program manager of REAL Solutions, National Credit Union Foundation: * Albert Mensah, motivational speaker; * Joey Rudisill, vice president of information technology, First Tech CU; and * George Towle, partner, The Rochdale Group, Inc.
The symposium is open to member credit unions of GCUA. Online registration is available in on the GCUA website.

75 of Gustav-affected CUs fully operational

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MADISON, Wis. (9/5/08)--More than 75% of credit unions in the Gulf Coast states affected by Hurrican Gustav are operational, while the rest try to get back to normal. There were fewer losses than expected, but access to affected areas Thursday were still hampered by power outages and communications problems. The National Credit Union Administration (NCUA) said that as of the close of business Thursday there were about 180 federal and state-chartered credit unions in affected areas and that more than 75% are fully operational. "Efforts to contact the remainder are hampered by power outages, which are making it difficult to ascertain the status of the others," John McKechnie, director, office of political and congressional affairs for NCUA, told News Now. For Mississippi, “this was a non-event in contrast to Hurricane Katrina [in 2005],” Charles Elliott, president/CEO of the Mississippi Credit Union Association, told News Now. “We do not have much damage. Some credit unions got some water and were sandbagging. There was minimal water and flooding. “Two Gulf Coast offices were not open Wednesday--mostly due to lack of staff, but they are open today,” he said Thursday. “We also had some branches that were not open Tuesday. We came out of this extremely well. We were prepared for the worst. So we feel fortunate.” While CUNA Mutual Group cannot provide specific names of credit unions that reported losses, due to confidentiality constraints, it did have an update on the aftermath of Gustav and what lies ahead, Phil Tschudy, CUNA Mutual media relations manager, told News Now. “We're still concerned for credit unions suffering from Hurricane Gustav, but the attention of CUNA Mutual’s property and casualty claims area now is also focused on Hanna and Ike,” Tschudy said. “Regarding Gustav, losses sustained by credit unions continue to be far less than we had expected. This doesn't mean some credit unions will not have challenges ahead of them, however.” Many New Orleans and Baton Rouge, La., area credit unions are not yet open due primarily to evacuation orders and/or power outages, he added. “Through information provided to us by the Louisiana league, and from New Orleans and area credit unions we've been able to reach, we believe that once people are allowed back, most credit unions should be fully operational once power is restored. “Our adjusters in the Baton Rouge area report that actual physical damage to buildings is not serious, but the lack of power, downed trees and sporadic communications in that area will continue to hamper recovery operations and prevent credit unions from opening. Authorities hope this situation will improve dramatically over the next few days,” Tschudy said. Credit union staff in three affected parishes in Louisiana--Terrebonne, Lafourche and St. Mary--will be able to fully assess damages on Monday and let the National Credit Union Foundation (NCUF) know if national fund-raising assistance is needed, Steve Bosack, NCUF deputy director, told News Now Thursday. The Credit Union National Association (CUNA) is monitoring the aftermath of Hurricane Gustav and is ready to respond, if necessary, with resources that include the following: CU Locate: the Credit Union National Emergency Information System provides credit union members with a toll-free number, 1-877-CULOCATE (877-285-6228), to receive information about the status of their credit union affected by a crisis. R.E.S.C.U.: the Relief Effort and Support for Credit Unions is the credit union movement's effort to prepare for and respond to large-scale natural and man-made emergencies and business interruptions. This resource includes Adopt-A-Credit Union. Also, CUNA Strategic Services offers disaster preparedness and recovery services through several alliance programs:
* Agility Recovery Solutions can provide a mobile recovery unit fully equipped with power, communications, computer equipment, and many other amenities within 48 hours of a disaster. * Strohl Systems offers PLANet, the industry’s only Internet-based business continuity planning tool designed to help credit unions meet NCUA and Federal Financial Institutions Examination Council regulations for business continuity and disaster recovery. * VoiceGard offers a comprehensive suite of services to restore telephone capabilities after a catastrophic system (PBX) failure or loss of facilities.
For more information, use the resource links.

Louisiana power outages impact CUs

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NEW ORLEANS and BATON ROUGE, La. (9/5/08)--Power outages in New Orleans, Baton Rouge and surrounding areas in Louisiana are affecting credit unions, as residents begin returning to the cities evacuated before Hurricane Gustav. The Louisiana Credit Union League announced it had rescheduled two educational programs because of the outages. The league has rescheduled two of its educational programs because of power outages in Baton Rouge and New Orleans. The FACT Act Identity Theft Red Flag Guidelines has been rescheduled for Sept. 22. Opening Share Accounts has been rescheduled for Oct. 9 and Oct 10. The league plans to send out an additional updates to those who registered for the programs. Many credit unions were serving their members through online transactions although some branches were closed, according to credit unions News Now contacted. It attempted to contact credit unions in Houma, New Orleans, and Baton Rouge. A branch of Denham Springs-based LA DOTD FCU in Baton Rouge had some wind damage and has no power, so it is closed, according to Cary Anderson, CEO, and Michele Merle Lacour, vice president of growth services. "We were operating Tuesday and Wednesday because we put in redundant systems," said Anderson. "We made sure we had everyone's addresses and contact information so we wouldn't lose anyone." LaCour explained that the credit union lost contact with one or two employees during Hurricane Rita. "This time we knew where everyone was." Anderson noted members from other credit unions started arriving at LA DOTD FCU's Service Center Wednesday. Some of their credit unions' systems were down, which meant the members--and the service center--couldn't access the accounts. "Ours was working because we are part of Harland Ultradata Service Bureau, which is based in Des Moines, Iowa," Anderson said. LaCour said the credit union was able to provide nonmember services such as check cashing, purchase of gift cards, and credit card advances. A lot of members have wind damage to roofs and trees down, they said. "Fifty percent of Baton Rouge should have power in about eight days, and the other half will get it in three to four weeks," Anderson said, adding that Lafourche Parish won't get power for six weeks. He noted that people planned better for this hurricane. "This week was the month-end, when we take a look at the shares. From Friday noon to Saturday closing time, members withdrew $1 million--that's more than they take out in a month," he said. LaCour noted the ATM out front had only $1,300 left before it was refilled Thursday. The Lake Charles office ran out of cash and had to have an emergency delivery, they said. Although Katrina is the bigger event for New Orleans, Gustav was the bigger event for Baton Rouge, said Lacour. They told News Now there has not been a lot of flooding, although the river was about to crest. Another Baton Rouge-based credit union, La Capitol FCU, is “doing fine,” CEO Susan Leake told News Now Thursday. The credit union’s northern Louisiana branches were open during the storm, but Southern Louisiana branches were not. Some of the branches were closed as of press time--such as those in Houma--because the city had not yet begun letting people back in. The credit union doesn’t expect any significant damages from the storm. Business was slow on Thursday. “I’m rather surprised,” Leake said. “We made a huge effort to open in Baton Rouge.” Staff and members at the Baton Rouge branch are “delighted” to be there because the credit union has electricity and air conditioning. Parts of Baton Rouge are without power, and it may be several weeks before it goes back on--which isn’t great when it’s 98 degrees, Leake noted. “We were hit very hard,” she said. Damage in Baton Rouge consists of downed trees and roof damage, but there were few deaths, she added. “We were very blessed.” The credit union’s branches that operated on Wednesday did so with “skeleton crews,” she said. La Capitol spent “a lot of time,” last week on its disaster recovery plan. The credit union reviews its plans before hurricane season every year, but made an effort to ensure the execution of it was completed by close of business on Friday. Some staff members grumbled because the storm wasn’t expected to hit until after Labor Day, but “I didn’t feel comfortable waiting until next week,” Leake said. “We have a lot less work after the storm.” The credit union also loaded its ATMs with cash before the storm, and the “activity was ahead of it,” she added. The status of many credit unions is still unknown. Communications is spotty or non-existent in some areas. According to information on credit unions’ websites:
* Campus FCU, Baton Rouge, was closed Thursday; * Coast Guard Employees CU, New Orleans, will not process loans until further notice. The credit union asked its members not to come to the credit union unless necessary. Coast Guard’s remote site is intact and will run on limited operations. The main office was expected to be open Thursday for a few hours to handle phone calls; * CUSA FCU, Covington, closed Thursday; * Michoud CU, New Orleans, was closed through Friday; * New Orleans Firemen’s CU opened the Picayune ranch Thursday and confirmed that other locations would open Friday if the buildings had water and electricity; * Noda CU, New Orleans, will be closed until Monday; and * University of New Orleans CU will re-open Monday.
Credit unions, like others in the area, are dealing with basics. According to LA DOT FCU's Anderson and Lacour, the big issue for residents is gas and ice. Anderson's wife was in line for two hours for five gallons of gas, he said. "The gas stations have gas but they don't have the power to pump it." The credit union has provided a credit union day care center for employees because schools are out this week. It is entertaining about five or six children with movies in the training room, and it paid them to help pick up the storm's debris out front. It's hot and sticky. Hot showers are nonexistent. But the credit union knows its focus. It is still "just trying to take care of our employees and our members," said Anderson.

CU in Alabama helps Gustav-displaced CU

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WETUMPKA, Ala. (9/5/08)--Alabama State Employees (ASE) CU, Wetumpka, Ala., opened its doors to help a Louisiana credit union whose disaster recovery plan for Hurricane Gustav needed a change.
Click to view larger image Staff members from ASI FCU, Harahan, La., served their members through two conference rooms and the CEO's office at Alabama State Employees CU, Wetumpka, Ala., this week after ASI's alternate locations for disaster recovery from Hurricane Gustav did not work out. (Photo provided by Alabama State Employees CU)
Mignhon Tourne, ASI CU CEO, told News Now that ASI decided to change the geographic location in its disaster recovery plan when it realized that its alternate location may be without power due to the direction Gustav was traveling. Harahan, La.-based ASI looked at relocating temporarily to Memphis, Tenn., or Montgomery, Ala. After researching ASE and realizing that its asset size was comparable to ASI’s, Tourne made the call to ASE’s CEO, Ned McHenry. “Ned answered the phone immediately and said ‘Come up here,’” Tourne said. McHenry told Tourne that the credit union had two conference rooms available for its staff to use. “I felt like we had something to help them out,” McHenry told News Now. ASI’s disaster recovery team traveled to Montgomery last weekend to set up. The information technology staff from ASI left for Montgomery ahead of everyone else, and set up Internet access and phone lines at the credit union on Monday. ASE was “absolutely great,” Tourne said. “ASE deserves a lot of recognition and thanks for the helping hand it extended.” “It was a good experience for us as it was for them,” McHenry said. Other ASI staff members stayed behind in Harahan until the credit union closed for business Saturday afternoon. Montgomery is about a four-hour drive from New Orleans, but the staffers who left later were caught in “bumper-to-bumper traffic” and made the drive in nine to 12 hours, Tourne said. About 21 ASI employees, their families and 12 pets made the trip. They stayed in a Montgomery hotel that “went out of its way” to help the credit union staff members. “They were fantastic,” Tourne said. Tourne was heading back to ASI in Harahan while talking to News Now Thursday, and said parts of New Orleans were without power. The credit union planned to restore service by Monday, she said.

2008 Missouri CU award winners named

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ST. LOUIS (9/5/08)--The Missouri Credit Union Association (MCUA) named the credit union winners in the state-level Dora Maxwell Social Responsibility, Louise Herring Philosophy in Action, and Desjardins Youth Financial Education awards. The awards recognize credit unions statewide for their efforts in activities to help their communities, members and young people. MCUA will recognize the winners during the first Missouri Credit Union Convention and Exposition, Sept. 16-19. First-place winners advance to the Credit Union National Association competition. The 2008 Missouri first-place award recipients for the Dora Maxwell Social Responsibility Award--include:
* Joplin (Mo.) Metro CU--$5 million to $20 million assets; * Raytown-Lee’s Summit Community CU, Raytown--$20 million to $50 million assets; * Central Missouri Community CU, Warrensburg--$50 million to $100 million assets; * Mid Missouri CU, Ft. Leonard Wood--$100 million to $200 million assets; * Mazuma CU, Kansas City--$200 million to $500 million assets; and * CommunityAmerica CU, Kansas City--Greater than $500 million.
Louise Herring Award for Philosophy in Action--first place:
* Raytown-Lee’s Summit Community CU--less than $50 million assets; * St. Louis Community CU--$50 million to $250 million assets; and * Vantage CU, Bridgeton--greater than $250 million.
Desjardins Youth Financial Education Award--first place:
* Raytown-Lee’s Summit Community CU--$35 million to $75 million assets; * Gateway Metro FCU, St. Louis--$75 million to $250 million; and * Vantage CU--greater than $250 million.

ICNNMoneyI Overdraft problems fade after switch to CUs

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NEW YORK (9/5/08) staff writer Jessica Dickler says her readers are outraged about overdraft fees. But, she added, a number of readers with overdraft fee problems at banks said their problems disappeared after they switched to a credit union. "Many readers said that their overdraft fee problems went away when they moved their money over to the local credit union," wrote Dickler in "Overdraft outrage: You weigh in," posted Wednesday. She quoted "Hunter" of Brunswick, Maine, who said, "This is one of the reasons I have stopped doing business with banks. All of my accounts are in credit unions. I have found you get better service and very low or no fees on most of the things banks charge big bucks for." Readers criticized the way overdraft fees are calculated. Many have learned the hard way that banks debit checks or charges from largest check to smallest, not from the dates of the checks, said Dickler. As a result, consumers may pay more overdraft fees. In the article, the American Bankers Association encouraged disgruntled customers to switch banks, saying that it was the strongest way to let a bank know how one feels about its policies.

CU System briefs (09/04/2008)

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* GREENSBORO, N.C. (9/5/08)--The Carolinas Credit Union Foundation (CCUF) is awarding a $10,000 Micro Community Grant to HORSEPOWER Inc. to renovate the agency's barn. HORSEPOWER uses horses to work with individuals with disabilities in a program of therapeutic, educational and recreational value. The program benefits individuals who are mentally, physically, emotionally and/or socially challenged. HORSEPOWER also received a Micro Community Grant in 2006. The grants allow credit unions in North and South Carolina to partner with local nonprofit agencies to bring benefit to the community. The North Piedmont Chapter of Credit Unions helped with the proposal. "Credit unions care about the communities that they operate in, and HORSEPOWER is an agency that all the credit unions in the chapter enthusiastically support," said CCUF President/CEO John Slack (Weekly Update Sept. 4) … * DUBLIN, Ohio (9/5/08)--The Ohio Credit Union League has signed a 10-year lease for its new quarters in downtown Columbus. League President Paul Mercer signed the lease for more than 9,000 square feet on the 11th floor of the One Columbus building at 10 West Broad St. The building, currently under construction, will overlook the Ohio Statehouse and provide convenient access to elected officials, media outlets and regulators, says the league. The league will move to an interim office in early October for a few weeks (eLumination Newsletter Aug. 27) … * FRISCO, Texas (9/5/08)--Texans CU and Frisco Independent School District have partnered to open a student-run credit union branch at the Career and Technology Center in the district. Led by a Texans' operation manager, four students will earn CO-OP credit by working in the credit union throughout the school year. Texans says it is the first credit union in the area to open this type of branch. From left are Dara Stork, Texans CU student employee, Wakeland High School; Yvette Marquez, McDermott Branch operations manager; and Breandrea Adevereaux, Texans CU student employee at Wakeland. (Photo provided by Texans CU) … * SALT LAKE CITY (9/5/08) --Mountain America CU's board of directors has named Sterling W. Nielsen as president/CEO of the $3 billion asset credit union. Nielsen will take the reins from Gordon R. Dames, who will retire on Dec. 31 after 16 year leading the Salt Lake City-based credit union. Nielsen joined Mountain America in 1995. Prior to his appointment, he served as executive vice president, chief administrative officer. Floyd Tanner, chairman of Mountain America's board, made the announcement … * MICHIGAN CENTER, Mich. (9/5/08)--Terry L. Brandt, 56, was convicted Wednesday of embezzling $226,170 from Michigan Center-based Cascades CU while he was chief financial officer and treasurer of the credit union. According to court records, Brandt wired money from the credit union's general account to his personal trading accounts at least nine times between October 2006 and January 2008. He faces up to 20 years in prison. Sentencing has been set for Oct. 9 ( Sept. 3) …

Leagues CUs eye Hanna and Ike and Josephine

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MADISON, Wis. (9/4/08)--With tropical storms lined up across the Atlantic like ducks in a shooting gallery, leagues and credit unions are taking precautions to make sure they're prepared for any situation. Fresh from weathering Hurricane Gustav in the Gulf, credit unions' next area of concern is Tropical Storm Hanna, which was already strengthening Wednesday and was expected to resume hurricane status before the weekend, when it will hit the Southeast coast of the U.S. Behind Hanna lurks Hurricane Ike, which could strike the Caribbean by Sunday, followed by a weaker Tropical Storm Josephine. South Carolina Credit Union League President/CEO Gen. Garry Parks sent an alert to member credit unions Tuesday about Hanna. At that time Hanna had hurricane status and had been responsible for 25 deaths in Haiti. With the possible hurricane bearing down on the southeastern coast, credit unions must orient their attention to the potential impact of the storm, Parks said. He reminded credit unions of several league resources and CUNA Strategic Services disaster preparedness and recovery services (see resource links for services) and that the league would assist them in any way possible. The Georgia Credit Union Affiliates also sent out a "severe weather watch" alert Wednesday afternoon, said Anita Paul, director of communications. "Based on recent weather reports, it appears that Georgia could avoid the worst of these storms. However, Georgia Credit Union Affiliates advises all Georgia credit unions to take this opportunity to review your disaster and business continuity plans with your staff," said the alert. The alert noted that now is the time to set up voice messages using the VoiceGard system, a CUNA Strategic Service that is free to all credit unions regardless of their affiliation with the Credit Union National Association (CUNA) or the league. Credit unions with other alert systems to advise members and staff of the credit union's status were encouraged to include the information on their website, their outgoing voicemail messages and any upcoming publications, statement stuffers and other materials, said the Georgia alert. The Florida Credit Union League is also monitoring the storm. "At this time, we're just monitoring the situation," Amy Jowers, league vice president of communications, told News Now. "The governor has issued a State of Emergency declaration for Florida to be 'on guard' and ready to assist should Florida be threatened by Hanna." The Florida league planned to have a conference call with federal and state regulators and Southeast Corporate this morning and would know more at that point, said Jowers Wednesday. "Fortunately for Florida, it looks like Hanna is skirting around us, but as always, we'll stay on top of this due to the unpredictable behavior that these storms have." Hanna's potential has leagues as far inland as Pennsylvania advising credit unions to review their business continuity plans and prepare emergency kits in advance of the storm in case there is significant flooding. Many credit unions' business continuity plans got a workout with two major storms: last month's Hurricane Fay, which caused flooding in Florida, and Monday's Hurricane Gustav, which made landfall on Louisiana soil as a Category Two hurricane.

Shared branching providers to assist in hurricanes

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ATLANTA, HAGERSTOWN, Md., and SAN DIMAS, Calif. (9/4/08)--Shared branching is helping credit unions provide service to members in hurricane-affected areas. On Monday, Hurricane Gustav made landfall west of New Orleans. Tropical Storm Hanna is expected to hit near Georgia and South Carolina this week. The storms have prompted several vendors to help credit unions with shared branching. “Having shared branching in place before an emergency situation is ideal,” said Carroll Beach, CO-OP Shared Branching president and chief operating officer. CO-OP Shared Branching staff have been in contact with credit unions in the Gulf Coast since Hurricane Gustav began threatening the area last week. The vendor has helped implement offline procedures and emergency rules as needed, the company said in a release. CO-OP’s network services team and information technology staff also have been on alert status to provide continuous service. The company’s Next Generation Network is available to assist credit unions not on shared branching. Financial Service Centers Cooperative (FSCC) and Ongoing Operations (OGO) also helped credit unions in the Gulf Coast. “The benefit of shared branching is evident during disasters, but our connections allow us to assist non-shared branching credit unions as well,” said FSCC President/CEO Sarah Canepa Bang. OGO and FSCC are helping a non-shared branching credit union in the Gulf Coast rebuild its ATM activity. “We are able to leverage [FSCC’s] connection to assist a credit union in Harahan, La., that has declared disaster mode. Their members may currently be displaced or in different areas of the country; therefore, this strategy simplifies the way credit unions bounce back,” said OGO President/CEO Kirk Drake. FSCC also offers the Emergency Shared Branch program, which provides credit unions and their members a way to complete deposits and withdrawals at FSCC shared branch locations. FSCC is waiving the set-up charge for the program and is not requiring credit unions to sign onto full shared branching. Credit unions also are using FSCC’s emergency hotline service, which is operated by Digital Dialogue--a subsidiary of PSCU Financial Services. The program gives credit union staff and members a phone number to call for information. FSCC’s virtual private network is helping credit unions connect their disaster sites to shared branch services. FSCC offers the Shared Branch Network, with more than 5,000 full-service deposit-taking locations in the U.S. and overseas. OGO is a credit union service organization providing software and processing solutions for credit unions.

2008 breaches already break 2007 record

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SAN DIEGO (9/4/08)--The number of data breaches for 2008 so far has surpassed the final total of 446 reported in all of 2007--more than four months before the end of 2008. That’s not good news for credit unions and other financial institutions forced to reissue credit and debit cards to protect their members from identity theft and fraud related to data breaches of other companies. As of Aug. 22, the number of confirmed data breaches in 2008 was 449, said the Identity Theft Resource Center (ITRC). The actual number of breaches is likely higher due to under-reporting last year and because some of the reported breaches affecting multiple businesses are listed as single events, the ITRC said. ITRC is a non-profit organization established to support victims of identity theft in resolving their cases, and to broaden public education and awareness about identity theft. ITRC recognizes that 449 breaches in less than a year is a small number when compared with the total number of businesses, government, health, banking and educational institutions that have databases. The growth in the number of breaches from year to year can no longer be solely attributed to required reporting laws and media investigative work, the ITRC noted. Part of the growth of the ITRC’s breach list is due to the ability to access state attorney general notification lists, which contain breaches that were not reported via media or other sources, noted Linda Foley, ITRC founder. “If more states would publish breach notification lists, there would be more information to study and to help us understand this growing concern,” Foley said. “At this time, only three states publish such information. “Additionally, more companies are starting to audit their security and network systems and use readily available security measures. This pro-active approach means that breaches are being identified that might otherwise have gone undetected,” Foley added. “The number of attacks, in addition to publicly disclosed breaches, continues to escalate as criminal networks mushroom around the world, while economies weaken,” said Avivah Litan, vice president and analyst, Gartner Inc. “A more concerted effort is required among companies to secure and protect customer data, regardless of regulatory oversight.” The ITRC breach list is a compilation of breaches confirmed by various media sources and notification lists from state governmental agencies. ITRC uses several websites to help search for verifiable breaches, such as,, The Breach Blog and To qualify, breaches must include personal identifying information that could lead to identity theft, especially the loss of Social Security numbers. The purpose of the ITRC breach list is to study:
* What are the weak links in security that might lead to a breach? * What policy changes need to be considered? * What protocols need to be established and then taught to all employees, including the highest ranking executive? and * Can risk levels be predicted or reduced?

California CU-supported data breach bill sent to governor

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SACRAMENTO, Calif. (9/4/08)--California consumers attained a legislative victory with the Sunday passage of Assembly Bill (AB) 1656, legislation that aims to protect consumer debit and credit card information from hackers and identity thieves, according to the California Credit Union League. California Gov. Arnold Schwarzenegger has until Sept. 30 to act on the legislation. AB 1656, authored by Sacramento Assemblyman Dave Jones, seeks to ensure that California retailers and government agencies protect consumers’ sensitive financial data and take responsibility for any unauthorized access of that information. The legislation is sponsored by the league. “This has been a two-year battle to pass legislation that provides consumers substantial new protection from retail data breaches,” said Bill Cheney, league president/CEO. “We urge the governor to acknowledge the solid vote of approval from the California legislature by quickly signing the bill into law.” The bill passed by a 34-3 margin in the Senate, and a 74-1 margin in the Assembly. AB 1656 would require retailers to adopt security standards based on industry best practices when storing consumers’ credit and debit card information, and give consumers better information about when and where their personal financial information is stolen during a data breach. In 2006, the nation’s largest data breach of TJX Cos. data resulted in the theft of 46.5 million consumers’ credit or debit card information. While credit unions and other financial institutions worked to replace the breached cards, they were not able to inform consumers of where the breach occurred--leaving many consumers frustrated at retailers’ lack of attention to security measures. “Consumers should be able to feel confident when making purchases that their personal data is kept safe and secure,” Cheney said. “Passage of this bill will help strengthen consumer confidence and require full transparency for any future breaches that may occur.” Last October, Gov. Schwarzenegger vetoed a similar league-backed bill--AB 779--also authored by Jones, after intense opposition from retailers and bankers. At the time, Cheney pledged the league would renew efforts to pass a data protection bill to aid California consumers (News Now Oct. 16). AB 779 had required retailers to reimburse customers for replacement costs of debit and credit cards. AB 1656 removed that provision (Associated Press Aug. 31).

CU System briefs (09/03/2008)

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* ODESSA, Texas (9/4/08)--Texas Credit Union League (TCUL) Political Action Committee (PAC) Chairman Jim Minge, left, gets a close
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haircut from TCUL President Dick Ensweiler, after Minge threw down the gauntlet and challenged the league's board of directors to join the PAC at the League Capitol Club level. Minge, of Randolph-Brooks FCU in Live Oak, promised he would shave his head at the next board meeting in Odessa Aug. 27. The board took up the challenge. Minge, shown with his new look, says the look is quite a PAC conversation starter. He is not planning to keep the new length. In the meantime, the intranet at Randolph-Brooks FCU is receiving its share of internal hits with an article called "extreme PAC makeover." There, employees can vote on who Minge most resembles--Lex Luther, Mr. Clean, Dr. Evil or Kojak. The league says that as of Wednesday morning, Dr. Evil had pulled ahead by 4%. (Photos provided by the Texas Credit Union League) … * MADISON, Wis. (9/4/08)--Credit union consultant and presenter Mark Lynch, who moved to the U.S. four years ago from Australia, has become a U.S. citizen--an experience he says will help him assist credit unions in developing immigrant outreach programs. Lynch has spoken to more than 150 credit union audiences in 47 states about the impact of taxation on Australia's credit unions and the lessons U.S. credit unions could learn from that experience, and on board governance strategies. The past two years he has been a field coach with the National Credit Union Foundation's REAL Solutions Program and spoken to audiences about serving the underserved. He said that experience helped him become a citizen. "As part of the REAL Solutions program, we help credit unions develop programs to serve new immigrants and new citizens and what better way to speak from experience than go through the process yourself," Lynch said … * SACRAMENTO, Calif. (9/4/08)--The Golden 1 CU, a $6.9 billion asset, Sacramento, Calif.-based credit union will merge with the $19 million asset, San Jose, Calif.-based 1st United CU, The Golden 1 announced Aug. 28. The date the merger would be completed was not announced in a Golden 1 press release. Golden 1 has 75 branches with more than 690,000 members. 1st United has two branches with 2,850 members ( Aug. 29) … * AUSTIN, Texas (9/4/08)--The A+ Education Foundation at A+ FCU has awarded almost $40,000 this year through its Educator Grant Program, designed to help teachers improve their students’ classroom experience. Forty-two area teachers received grants for projects such as iPod tutorials, recycling clubs and help for dyslexic students. Since its inception in 2005, the foundation has awarded more than $121,000 in grants. A+ FCU is based in Austin, Texas, and has $611 million in assets ( Aug. 29) … * TUCSON, Ariz. (9/4/08)--Tucson (Ariz.) FCU, a $249 million-asset credit union, was robbed twice last month. The most recent robbery occurred Aug. 27, with no injuries reported and no weapon displayed during the incident, according to police. After walking into the credit union and handing the teller a note, the robber left with an undisclosed amount of cash. The robber was described as a 17- to 19-year old, wearing a New York Yankees baseball cap and a black shirt. On Aug. 1, the credit union also was robbed (Arizona Daily Star Aug. 28) … * CHARLOTTE, N.C. (9/4/08)--An armed man, holding a cell phone to his ear the entire time, robbed the Hamlet (N.C.) FCU on Aug. 27, according to the Federal Bureau of Investigation's Charlotte field office. The man entered the credit union just before lunchtime and pointed a gun at a teller. He demanded money from the drawer and forced the teller to get money from the vault (US Fed News Aug. 28) … * WETHERSFIELD, Conn. (9/4/08)--Daniel R. "Dan" Abbate of Wethersfield, Conn., died Friday. He was 81. Abbate, a former deputy fire chief, was a past president of the Hartford Firefighters FCU, Hartford. He is survived by his wife, a son, four grandchildren, one great-grandchild, and one brother. Funeral services were Tuesday. (The Hartford Courant Aug. 30) …

Few CUs report damages in Gustav

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MADISON, Wis. (9/3/08)--Some credit unions sustained minor damages from Hurricane Gustav, but no major losses have been reported yet, according to CUNA Mutual Group. Gustav made landfall about 70 miles west of New Orleans. The Category 2 hurricane was responsible for 7 deaths in the U.S. and prompted a massive evacuation in Louisiana ( Sept. 2). The CUNA Mutual Credit Union Protection Claims staff is monitoring policyholders in the New Orleans area and southern Mississippi and is not expecting reports of major wind-related damage. Flooding will likely occur along the path of Hurricane Gustav, Phil Tschudy, CUNA Mutual Group media relations manager, told News Now. “Evacuation losses have prevented some credit unions from getting back to their buildings, but we remain cautiously optimistic that damage to these credit unions will be minor,” he said. “Once evacuation orders have been lifted, CUNA Mutual will contact policyholders and will have claim adjusters in the area as needed.” Many credit unions are now open in Mississippi, but they’re “operating on skeleton crews,” Charles Elliott, Mississippi Credit Union Association, told News Now. Three credit unions in Mississippi were closed Tuesday--two because of limited staff. Many credit union employees evacuated the area and haven’t returned yet, he said. “Many employees evacuated, and hopefully they’ll get back today,” Elliott said Tuesday. He also noted that there are power outages in the state. Keesler FCU, Biloxi, was open Tuesday except for the Stennis branch. The branch was closed because the building in which it is located was closed. Some Keesler branches had limited drive-up service available, the credit union said on its website. No damages to credit unions have been reported to the association. Access to some areas is still limited due to storm debris and flooding, but most credit unions have provided initial condition reports, with many reporting they were open today, the association said. “We were prepared for the worst and hoping for the best,” Elliott said. The association is working with the Louisiana Credit Union League on shared branching to help some credit unions that are offline, Elliott added. The Alabama Credit Union League has been in contact with its credit unions, and there is no reported damage, Adena Whitman Zamora, league director of public and political affairs, told News Now. “Everyone is doing well,” she said. “[The league] is on standby to help where we can.” The league also will help its credit unions prepare for upcoming storms, she added. Although there were mandatory evacuations for Hardin, Orange and Jefferson Counties, the Texas coastline was spared, according to the Texas Credit Union League (TCUL). No credit unions reported any damage to TCUL, and the league is continuing to follow up with them. “It looks like our credit unions are in good shape,” said Linda Webb-Manon, league communications director, told News Now. Mobiloil FCU, Beaumont, Texas, was closed Tuesday to prepare for Gustav. Credit union members were able to perform financial transactions at 3,400 CU Service Centers nationwide, including 205 in Texas, the credit union said in a release. New Orleans was spared from the storm, and Baton Rouge was hit harder than anticipated. Credit unions were not able to open Tuesday because the city was evacuated. The Louisiana Credit Union League has contacted its credit unions and is staying in touch through text messaging. Phones are working sporadically. The disaster plan and shared branching for credit unions worked well, the league said.

CEO to INY TimesI--Our best friends were people at CU

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COLUMBUS, Ohio (9/3/08)--The CEO of Bob Evans Farms had good things to say about credit unions in an interview with The New York Times (Aug. 30). Steven A. Davis, chief executive of the restaurant chain headquartered in Columbus, Ohio, told about his upbringing in Milwaukee, Wis., as an African-American. He noted his mother was a postal clerk and father was a welder and line supervisor. His parents had set a goal that all five of their children obtain college degrees. They did. How did they do it? With help from a credit union. "Recently, my mother told me, 'Our best friends were the people at the credit union.' My parents borrowed money at the beginning of each school year and hurried to try to pay back that loan before the next school year started," Davis told the Times. For the full story, use the link.

Altura CU creates budget-impasse loans

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RIVERSIDE, Calif. (9/3/08)--Altura CU has set up a series of loans and other programs to assist state, county or school employees experiencing financial hardship as a result of California's budget impasse. State legislators are at an impasse about the state's budget, and state workers face a serious financial blow from potential job or pay cuts, said the Riverside, Calif.-based credit union. Nearly 10,000 state employees have been laid off. Gov. Arnold Schwarzenegger announced plans to cut the pay of another 200,000 employees to the federal minimum wage of $6.55 per hour. California Controller John Chiang refused to implement the pay cut and is being challenged in the courts by the governor. "Given the uncertainties surrounding the budget approval process, we are concerned about the financial impact on our members," said Jennifer Binkley, executive vice president/chief operating officer, at the $915 million asset credit union. Altura's programs are open to state, county or school employees who are members of the credit union or who are eligible. They can take advantage of one of these programs:
* $5,000 signature loan, with no processing fee, no interest or payments for 90 days. The term can be up to 48 months, and there is no prepayment penalty. * $10,000 signature equity loan for homeowners, with no payments or interest for 90 days. The loan has a $50 processing fee. Its term can be up to 60 months. There is no pre-payment penalty. * Delayed payroll loan, in which Altura will advance funds, for each payday that payroll is delayed, for up to three months maximum with no processing fee, interest or payments for up to 90 days. The term is up to 18 months. There is no prepayment penalty. * Skip-a-pay, where members already having an Altura loan can take advantage of the credit union's Skip-a-Pay program. The credit union will waive these requirements: the $25 fee, the six-month waiting period before skipping the first payment, and skipping only one payment a year.

CU loans still growing delinquencies level off in July

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MADISON, Wis. (9/3/08)--Credit union loans grew and delinquencies leveled off in July--indicating credit unions are faring well in the credit quality crisis.
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The dollar amount of credit union loans outstanding grew 1.2% in July, compared with 0.9% for the same period in 2007, according to the Credit Union National Association (CUNA) monthly sample of credit unions. Other loans (3.7%) and adjustable-rate first mortgages (2.4%) reflected the highest monthly percentage increases, followed by used-auto loans (1.3%), home equity loans (1.2%), and credit cards (1%). Credit union savings balances declined 0.5% in July 2008, compared with a 1.1% decrease in July 2007.
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“As banks tighten their lending underwriting standards, credit unions are picking up market share,” Steve Rick, CUNA senior economist, told News Now. “Credit union loan balances rose 5.3% in the first seven months of 2008, up from 3.3% in the similar period last year. Growth in the fixed-rate mortgage portfolio continues to lead the way with an increase of 0.8% in July and 14% year-to-date.” Money market accounts rose 0.7%, while regular shares, certificates and share drafts declined 1.7%, 0.4% and 0.4%, respectively. With loan growth outpacing savings growth, the loan-to-savings ratio increased to 83% in July from 82% in June. The liquidity ratio--the ratio of surplus finds maturing in less than one year to borrowings plus other liabilities--decreased to 15.6% in July from 17.4% in June. Regarding asset quality, credit unions’ 60-plus-day delinquencies have remained at 1% for the past seven months. “The overall credit union loan delinquency rate appears to have leveled off around 1.05% over the past couple of months, a hopeful sign that the credit quality crisis infecting other lenders is not having a significant negative impact on credit union balance sheets,” Rick said. The movement’s overall capital-to-asset ratio is 11%. The total dollar amount of capital remains at $90 billion.

Faith-based CU lends more than a helping hand

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JACKSON, Miss. (9/3/08)--Hope Community CU, a faith-based Jackson, Miss., credit union with branches in three states, provides banking services to the underserved and invests in community development. It also comes through in a hurricane. Although it still early in the recovery process from Hurricane Gustav, and because most people are still evacuated from the affected areas until Thursday, Hope Community will provide assistance to members in areas affected by the hurricane, Bill Bynum, CEO, told News Now . “We’re making plans to provide access to loans and account to members and people experiencing disruption,” Bynum said. “We’re also looking at being of assistance to other faith-based institutions in harder-hit parts of southwest Louisiana. We also plan to help provide access to funds from philanthropic organizations and government sources of assistance, such as Federal Emergency Management Agency (FEMA) payments.” The $63.5 million asset credit union was started in 1995 when members of Anderson United Methodist church in Jackson organized Mississippi’s only church-sponsored credit union ( Sept. 2). Over the past 13 years, the credit union has grown through partnerships with other community development churches and faith-based organizations. The Enterprise Corporation of the Delta was Hope Community’s sponsor in 2002, and helped broaden the credit union’s reach onto more low-income communities, the paper said. The credit union opened a branch in New Orleans eight months before Hurricane Katrina struck in August 2005, and was in a solid position to help in the aftermath of the hurricane’s devastation, Bynum told the paper. The credit union will open a branch in Biloxi, Miss., by the end of the year, Bynum added. It now has branches in New Orleans and Memphis.

CO-OP Shared Branching surpasses Wachovia now No. 2

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ATLANTA (9/3/08)--CO-OP Shared Branching locations has topped 3,400, which means CO-OP is second only to Bank of America for the most banking branches in the nation. CO-OP surpassed Wachovia's 3,305 branches this week.
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Branches continue to be an essential element of the delivery channel mix for members desiring face-to-face interaction, said CO-OP. According to statistics from the American Bankers Association, even with the advent of Internet banking, 92% of members use a branch at least once a month to conduct a transaction. "Despite the rise of new technologies, members still consider physical locations a top priority in the selection of a primary financial institution," said Carroll Beach, president/chief operating officer of CO-OP Shared Branching. "With the growth and cooperation of shared branching, credit unions are on an even playing field to meet member demand for access closer to work or home while avoiding the capital expense of building proprietary brick and mortar," Beach added. So far this year, CO-OP Shared Branching has added 75 credit unions, accounting for 84% of new participants through all shared-branching providers.

NY Times Check CUs for mortgage Deals

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NEW YORK (9/3/08)--Credit unions are touted as a good source for mortgage loans in a Sunday article in The New York Times. Credit union mortgages are available to any consumers who meet a credit union’s membership requirements, are not typically marketed through brokers, and have become more attractive in the past few months, according to the article, “Check Credit Unions for Deals,” by Bob Tedeschi. Credit unions have come through the mortgage crisis better than conventional lenders because they are fairly conservative and usually lend to those members they know fairly well, Bill Hampel, chief economist for the Credit Union National Association (CUNA), told the paper. Mortgage lending at credit unions nationwide has gone up in the past year, which is unusual in a down economy, and unlike most lenders, “credit unions still have money to lend,” Hampel added. The article also mentioned the $3.039 billion asset Bethpage (N.Y.) FCU, which offered an adjustable-rate mortgage in late July at 4.875%. The loan features a fixed rate for the first three years and then can adjust by a maximum of two percentage points annually or every three years, depending on the product. The rate can never go beyond 10.875%. Because they are nonprofit institutions, credit unions can charge lower rates than conventional lenders, Michael Dean, Bethpage senior vice president of lending, told the paper. The article also directed readers to CUNA’s website for a list of credit unions.

Fund competition stiff CU share still low says group

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NEW YORK (9/2/08)--Credit unions received 15% of the 89 awards announced Thursday by the U.S. Treasury Department's Community Development Financial Institutions (CDFI) Fund. But they accounted for only 10.2% of the dollar amount, says the National Federation of Community Development Credit Unions (NFCDCU). While the fund has a large appropriation this year, competition was stiff, and credit union share of fund awards was still low, said the federation, with 225 organizations applying with more than $205 million in requests. The greatest number of requests and largest dollar amounts went to community development loan funds. Eight of the 26 credit union requests for Core and SECA grants, and five of 10 for technical assistance grants were funded. Nearly 90% of the credit union funding went to federation member CDCUs, said the federation. "We're delighted a significant number of credit unions received funding," said federation CEO Cliff Rosenthal. "Assistance from the CDFI Fund has helped to drive much of the innovation and expansion in the CDCU movement." He noted the funding for the coming year may be "the largest we've seen in quite a while. So we encourage CDCUs to get certified and apply in advance of the October deadlines." The federation believes "there is a lot of room for growth in credit union participation. For growth-oriented credit unions, there really is no resource comparable to the CDFI Fund," Rosenthal said. Certification applications for the next CDFI Fund funding round are due Oct. 1, and applications for funding are due Oct. 29, said the federation. The federation will conduct webinars on CDFI certification and application for credit unions, with the first, "Everything You Need to Know About Applying for Certification," scheduled for Sept. 9 at 3 p.m. For more information, contact Dan Apfel at 212-809-1850, ext. 220 or at

CUs nonprofits are allies in serving underserved

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CHICAGO (9/2/08)--Nonbanks are discovering--like credit unions and banks--that community-based nonprofit organizations can be strong partners for financial providers wanting to serve the unbanked. According to the Center for Financial Services Innovation, the landscape is changing for financial providers with retailers and technology firms eager to grab a share of the underserved market (American Banker Aug. 29). The center, an affiliate of ShoreBank in Chicago, has for the past four years funded efforts by nonprofits to develop and test financial products, services and strategies for serving the underserved. Its most recent round of funding attracted 133 proposals worth $30 million from nonprofits in 35 states, said the center. One credit union that knows the value of working with nonprofit agencies is Truliant FCU, a $1.208 billion credit union in Winston-Salem, N.C., according to the North Carolina Credit Union League (Weekly Update Aug. 29). Truliant offers a Truliant Community Mini-Grant Program to assist nonprofit agencies with operational costs. The program was designed by Marjorie Rorie, director of community services for Truliant and a former grant-writer. She has conducted 13 grant workshops to prepare nonprofit agencies with grant applications. "I wanted to find a way for Truliant to connect with what we feel is the 'heart' of every community--nonprofit organizations," said Rorie. "Truliant is committed to meeting the community's needs and has strengthened this connection by developing new guidelines for organizations with a 501 (c) 3 nonprofit status to open accounts with Truliant." To qualify for a grant, the agencies must impact one or more of these areas: health or human services, youth, affordable housing, financial literacy or economic development, said the credit union. More than 110 applicants submitted proposals, and 31 agencies received grants. The Center for Financial Services Innovation says that more than 80% of proposals it received in its latest funding round involved partnerships. Of those, two-fifths were collaborations with credit unions and banks. Six Michigan credit unions, for example, are testing a new product to reward savings with a combination of interest and cash prizes in a project with Doorways to Dreams Fund of Boston, said the center. Another such collaboration involves U.S. FCU, a $780 million asset credit union based in Burnsville, Minn., aiming to reach underserved people in a low-income neighborhood. Its collaboration with Lutheran Social Service of Minnesota has created the Eastside Financial Center in St. Paul, which provides basic financial services and other social services such as job training, said the innovation center.

Conn. CUs answer governors call 50000 for food

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MERIDEN, Conn. (9/2/08)--In response to Connecticut Gov. M. Jodi Rell's call for support for her "Care & Share" fund-raising program to feed the hungry, the Connecticut Credit Union Charitable Foundation presented her with a check for $50,000.
Click to view larger image Connecticut Credit Union Charitable Foundation Executive Director Mary Pollaro, left, presents Gov. M. Jodi Rell a check for $50,000 for the governor's Care & Share Program to feed the hungry in the state. (Photo provided by the Connecticut Credit Union Charitable Foundation)
The governor created the program to raise $100,000 for the Connecticut Food Bank and Hartford FoodShare, the state's two largest food banks. The foundation's trustees voted overwhelmingly to meet the governor's challenge, said Mary Ann Pollaro, executive director at the foundation. "The foundation raises its funds through special programs throughout the year, such as our annual raffle and the Dick Abely Memorial Golf Tournament, so it's really Connecticut credit unions and their members who have contributed to this worthwhile program," Pollaro said. On hand to present an additional $7,000 for the program were Anthony Emerson, president/CEO of the Credit Union League of Connecticut; William J. Dokas, president/CEO of American Eagle FCU; and Kelly Fuhlbrigge, vice president, government relations with the league.

California fin-lit education bill passes Assembly

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SACRAMENTO, Calif. (9/2/08)--The California State Assembly approved a California Credit Union League-supported bill Thursday that would require financial literacy instruction to be a part of future school curriculum development. Assembly Bill 1502 was introduced by assembly member Ted Lieu (D-Torrance). The bill requires the State Board of Education and the Curriculum Development and Supplemental Materials Commission to make sure that information about financial literacy is included in appropriate subject-area frameworks (US Fed News Aug. 28). “The league has been an active supporter of the bill,” Keri Bailey, league director of state government affairs, told News Now. “It will be transmitted to the governor within the next week or so. The governor will have 30 days--roughly until the end of September--to sign or veto the measure. Bailey said the league anticipates continuing its support. “For credit unions, financial literacy is a very important part of our mission to serve the communities and our members. So we are really looking forward to continuing our dialogue with the governor. We are hopeful we can get this bill signed,” she added. Three states--Missouri, Tennessee and Utah--mandate at least a one-semester course on personal finance, according to the Jump$tart Coalition for Personal Financial Literacy. At least 15 other states require personal financial instruction to be integrated into the existing curriculum.

CUNA issues call for board nominations

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WASHINGTON and MADISON, Wis. (9/2/08)--The Credit Union National Association (CUNA) is seeking nominations for eight positions on the CUNA board of directors. The eight directors will take office Feb. 27, 2009, for three-year terms to expire at the adjournment of the 2012 CUNA Annual General Meeting. Positions up for election are:
* District 1, Class B; * District 2, Class C; * District 3, Class A; * District 3, Class D; * District 4, Class B; * District 4, Class D; * District 5, Class A; and * District 6, Class C.
Nominations and seconds will be accepted beginning Friday. The deadline for nominations and seconds is Oct. 17. Nominators must submit the appropriate forms and obtain consent of the candidate. Voting will take place beginning Oct. 22 and will close on Dec. 19. For more information, use the resource links.

Georgia CUs raise 62000 for CMN

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DULUTH, Ga. (9/2/08)--More than 200 people representing 13 credit unions raised $62,000 for Children’s Miracle Network (CMN) at the Greater Atlanta CU Chapter’s six-annual Bowl-a-Thon.
Click to view larger image Representatives from credit unions in Greater Atlanta raised more than $62,000 for Children’s Hospitals through Credit Unions for Kids program. From left are: Kristi Arrington, Georgia Credit Union Affiliates; Penny Womble, IBM Southeast EFCU; Sharon Robinson, Children’s Miracle Network; Laura Sterling, Georgia’s Own CU; Patti Monroe, IBM Southeast EFCU; Brittany Green, CDC FCU; Kem Pastorino, Delta Community CU; and Jill Wilcox, Atlanta Postal CU. (Photo provided by Georgia Credit Union Affiliates)
“We are overjoyed with the outpouring of support that has enabled us to reach a new fundraising record for the sixth year in a row,” said Laura Sterling, communications manager, Georgia’s Own CU, Atlanta. The funds will support the Patient and Family Support Services program at Children’s Healthcare of Atlanta, said Georgia Credit Union Affiliates. Credit unions have raised more than $63 million since 1996 through the Credit Unions for Kids program. Making an appearance at the bowling event was youth named Jack, 9, who was injured after jumping out of his family’s pontoon boat and being hit by the propeller in May 2004. Jack underwent surgery at Children’s Healthcare of Atlanta after the accident.

NACUSOs BUY CUSO campaign hits 32500

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NEWPORT BEACH, Calif. (9/2/08)--The National Association of Credit Union Service Organizations (NACUSO) announced that it has raised $32,500 for its BUY CUSO campaign. Michigan Educational CU, Plymouth, recently donated $2,500 to support the advertising campaign. Funds have been donated by Mountain America FCU, West Jordan, Utah; CU*Answers; Member Gateways; Beyond Marketing; and TruHome Solutions. BUY CUSO is a NACUSO-sponsored campaign created to increase the awareness of credit union service organizations (CUSOs) as providers of solutions to credit unions. The campaign was launched April 28. NACUSO is an association of credit unions and CUSOs dedicated to helping credit unions grow through the National Center for Collaboration and Innovation.

IUSA TODAYI tells how to check safety of CUs

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NEW YORK (9/2/08)--The nationwide newspaper USA TODAY highlighted credit unions' safety and soundness in an article, "How to check the safety of your credit union," Friday in its Money section. Financial reporter Matt Kranz answered a question, "How do I know that the money I have in my credit union is safe?" by noting that credit unions are different from banks and brokers. He pointed out credit unions' not-for-profit cooperative nature, their membership's common bond, and their federal regulator, the National Credit Union Administration (NCUA). Members can check up on their credit union's performance by going to the NCUA's website at, he said, adding that a credit union's 5300 report will tell them how well-capitalized the credit union is and whether any loans are bad. He also noted credit unions' assets are backed by the National Credit Union Share Insurance Fund, "which is backed by the U.S. government." The Credit Union National Association also provided input for the article.

Gulf Coast CUs were prepared for the worst from Gustav

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MADISON, Wis. (9/2/08)--As Hurricane Gustav hit landfall at 10:30 a.m. CT Monday at Cocodrie, La., credit unions, their trade association and leagues, and their regulators were already prepared for the worst. The Credit Union National Association (CUNA) Disaster Preparedness Team, working with the Alabama, Florida, Louisiana, Mississippi, and Texas leagues, activated CU Locate in each of those states, effective Monday morning. And the National Credit Union Administration (NCUA) announced Monday it would activate its emergency hotline (888-584-6847) at 7 a.m. EDT today so members could check the status of credit union branches. Hurricane Gustav was a category two hurricane, with winds up to 110 mph at landfall roughly 15 miles west of Houma and about 70 miles west of New Orleans. It had been responsible for the deaths of at least 90 people in Jamaica and Cuba as a category four hurricane and prompted the largest evacuation before a hurricane in history--two million people from the New Orleans area alone. Cocodrie has no credit unions, but Houma, which has a population of 34,000, has six, according to The Credit Union Directory. They are:
* First Industrial FCU; * A branch of La Capitol FCU, based in Baton Rouge; * A branch of Post Office Employees CU, based in Metairie; * T G M E C FCU; * TEA FCU; and * Texaco CU of Houma.
The credit unions, like most in the nation, were closed due to the Labor Day holiday and the hurricane. The wide ranging storm was affecting areas in Alabama, Mississippi, and Louisiana Monday and was headed toward Texas. Widespread flooding from up to 20 inches of rain is expected in several states. In New Orleans, the levees on the western side of the city were holding steady, with Harvey Canal closing its floodgates Monday morning, and storm and wind surge causing steady seepage over the levee at the Industrial Canal. Outer rainbands of the storm kept tornado watches and three inches of rainfall per hour in Pascagoula, Miss., and Mobile, Ala. Weather forecasters expected flooding in Louisiana and Mississippi up into southern Arkansas. On Friday, the leagues along the Gulf Coast outlined their preparations for News Now. “We’re as prepared as we can be,” Charles Elliott, CEO, Mississippi Credit Union Association, said Friday. The league have multiple communications systems in place, such as cell phones and text messaging. Emergency numbers for all credit unions and vendors are available. Back-up branches and “hot sites” were ready. Agility Recovery Solutions and VoiceGard would provide back-up communications as needed. Members also can call 1-800-CU-LOCATE to contact their local credit union, he said. The league also worked with its corporate credit unions to get plenty of cash--which members came in to get Friday. "Prior to Hurricane Katrina, they came in after,” Elliott said.. Friday was the third-year anniversary of Hurricane Katrina, Elliott noted. The current storm was taking an emotional toll on credit unions and their members because of the uncertainty, he said. “But we’ve got some warning. Credit unions will be able to meet their members’ needs.” The Alabama Credit Union League has “been in contact with our credit unions, updating emergency contact information and distributing additional preparedness materials,” Adena Whitman Zamora, league director of public and political affairs, told News Now Friday. “We are sending out more information this afternoon and will continue to monitor the situation in preparation for next week’s landfall. “While we hope, of course, that the hurricane will not be a bad one, effective communication and preparation will help us help our credit unions through whatever events occur. “The league also is poised to provide assistance to our neighboring states in any way we can, however we are needed,” she added. The Louisiana Credit Union League (LCUL) was monitoring the storm, and had its TelSpan system ready for credit unions. Through the system, the Louisiana Office of Financial Institutions, which represents Louisiana financial institutions at the Office of Emergency Preparedness, will record information and alerts related to immediate threats and/or disasters in the area. Financial institutions could dial in and hear messages or alerts at a time that was convenient for their schedules. LCUL is the only credit union league to utilize the TelSpan program, the league said. “After going through Katrina, I believe the league and Louisiana credit unions are well-prepared for Gustav,” Lacey Hyer, LCUL public relations specialist told News Now Friday. “There is still some uncertainty as to where it will make landfall, so we will continue to monitor the hurricane and take necessary precautions.” The Louisiana league's 800 number (800-452-7221) and its website ( are in effect. The league gave out emergency contacts and phone numbers:
* New Orleans and Tri-Parish credit unions should contact Mary Wolfe at 504-487-8147; * Baton Rouge, Lafayette and Lake Charles credit unions should contact Jim Phillips, 225-603-2642; and * Shreveport, Alexandria and Monroe credit unions should contact Susie Fair at 318-663-7766.
NCUA encouraged all credit unions in the path of the storm to prepare for all contingencies, it said in a statement Friday. Credit unions should:
* Identify and prepare alternate sites; * Back up systems and ensure backup data is in a secure location; * Notify the NCUA regional office of the alternate site location; * Identify and prepare deploying employees to alternate locations; and * Test back up systems.
John McKechnie, NCUA's director of public and congressional affairs said Monday that in addition to its emergency toll-free hotline, 888-584-6847, credit union members can obtain additional information at its website at NCUA will distribute public service announcements to news media in the affected states to provide essential information to consumers about federal deposit insurance coverage for credit unions and how members can access their credit union funds, he said. NCUA said the U.S. Department of Homeland Security's "Ready Campaign" at or at 800-BE-READY provides information about disaster preparedness, including a link to the Emergency Financial First Aid Kit, a checklist of documents and steps consumers can take to maximize their preparedness. CUNA Mutual Group also was keeping watch over the storm situation. The CUNA Mutual Group Disaster Claim hotline is 800-637-2676. “CUNA Mutual has activated its Credit Union Protection Disaster Team, which will address any storm-related losses and coordinate property-casualty relief efforts,” Rick Uhlmann, CUNA Mutual senior manager of media relations, told News Now. “Once we have a better handle on where Gustav will hit, we will contact policyholders in those areas. Meantime, we are monitoring the storm's path hourly,” he said Friday. The Texas Credit Union League (TCUL) reminded credit unions in the LoneStar Leaguer that it has a special section on its website with advisories for severe weather and disasters. It also offers a site to store critical business continuity plans at "Hurricane Katrina taught us all a valuable lesson, and that there is no such thing as being too prepared," said TCUL CEO Dick Ensweiler. "We have alerted all of our credit unions, particularly those along the coast, and have provided them with the most current hurricane preparation material, as well as live feeds on our web site."

Illinois league chapters conference highlights PR

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NAPERVILLE, Ill. (9/2/08)--Nearly 100 chapter leaders from 24 of the Illinois Credit Union League’s (ICUL) 26 chapters attended its annual Chapter Leaders Conference last month. The conference was hosted by the Tri-County Chapter of Credit Unions and held in Utica, Ill. This year’s main program, “Stop the Presses: Raising the Profile of Your Chapter’s Good Works!” focused on helping chapters maximize public relations resources to promote activities within their communities. “Chapters are integral to the Illinois Credit Union System,” said Dan Plauda, ICUL president/CEO. “This conference was the perfect opportunity for chapter officials from around the state to network and gather ideas on how to revitalize and enhance their chapter’s effectiveness.” Several chapters were honored with Eagle Awards for quality programs provided to member credit unions and communities. The Best Community Involvement Program went to the Egyptian Chapter for its Dress for Success project, which helped 14 high school seniors prepare to enter the real world. Best Special Event awards went to:
* The Central Illinois Chapter, which focused on strengthening political ties with local legislators and statewide candidates at its legislative night event; * The Joseph S. DeRamus Chapter, which collected donations to provide Spinoza bears to a local hospital for terminally ill children; and * The Northwest Illinois Chapter, which was honored for a “Green Raffle” for a Yamaha scooter with more than $3,000 in proceeds benefiting the Illinois Credit Union Foundation, and the Credit Union Political Action Council (CUPAC), and for distributing free emergency financial first aid kits at three county fairs.
In 2007’s Chapter Competition for CUPAC, 100% of Illinois’ chapters participated for the second straight year, and raised more than $140,000. The top contributor was the Southeast Chapter, which raised $35,096. Several individuals received Chapter Leader and Chapter Representative of the Year awards. The Chapter Leader Award recipient was Penni Gebke, ICUL regional director. Other awards included:
* Karen Jurasek, iBelong Chapter Representative of the Year, Rockford Area Chapter; * Jeri Hanson, Illinois Youth Involvement Council Chapter Representative of the Year, Danville Area Chapter; and * Kim Hocking, ICU Foundation Chapter Representative of the Year, Southern Illinois Chapter.