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Full Issue: November 21, 2014

NEW: Matz: Revised RBC rule could be unveiled Jan. 15, 90-day comment period to follow

Washington
ALEXANDRIA, Va. (UPDATED 6:55 P.M. ET 11/21/14 )--National Credit Union Administration Board Chair Debbie Matz today announced that she will ask the board to consider a revised version of the risk-based capital proposal at its Jan. 15 open board meeting. Matz also said a 90-day public comment period would likely follow.

"During the six months since the comment period closed on the original proposed rule, we've taken the time to carefully review and methodically evaluate the many thoughtful comments received from stakeholders," Matz said. "We've also considered the input received during three Listening Sessions across the U.S. this summer. We're getting closer to issuing the revised proposed rule, which I now anticipate will be presented in January 2015--one year since the original proposed rule.

"To provide the public ample time to review this important safety and soundness rulemaking, I intend to support a 90-day comment period," she added.

The Credit Union National Association has strongly advocated for a reasonable comment period of at least 60 days, given the amount of structural changes that had been mentioned by NCUA, including longer implementation period and revised risk weights for mortgages, investments, member business loans, credit union service organizations and corporate credit unions.

More than 2,000 comments were received from credit unions, members of Congress and other stakeholders during the proposal's original comment period.

Other Resources

NCUA budget up by 4.2% for 2015, McWatters votes against it

Washington
ALEXANDRIA, Va. (11/21/14)--Two distinct opinions on the National Credit Union Administration's budget emerged at the agency's Thursday's open board meeting.

NCUA Chair Debbie Matz and Vice Chair Rick Metsger said they believe the budget approved by the agency is sufficient to provide the agency with the resources it needs to carry out its mission, while board member J. Mark McWatters said the agency should remain more mindful of spending credit unions' money, examine the necessity of all expenditures and make the process more transparent.

The agency's budget amount is $279.5 million, up $11.187 million (4.2%) from the previous year. While NCUA Chief Financial Officer Mary Ann Woodson said this was the lowest increase in eight years, the Credit Union National Association remains concerned that this is the eighth consecutive year the budget has increased.
Click to view larger imageNCUA board member J. Mark McWatters reads a statement with concerns about the agency's 2015 budget, as NCUA Chair Debbie Matz listens. (CUNA Photo)

"The Credit Union National Association remains very concerned that the National Credit Union Administration board has increased its budget yet again. Rather than reducing expenditures, the agency has continued to bolster its budget for eight straight years," said CUNA President/CEO Jim Nussle.

"Based on my own experience in building budgets, I know that monitoring and modernizing resources to maximize funds--which credit unions have been doing--are among the most effective methods for containing costs. NCUA is not following a similar path and that's a concern for me and credit unions. CUNA will continue pressing the agency to be more efficient with credit unions' funds," he said.

Employee pay and benefits rose by 3.7% million for 2015, which made up the bulk of the increase from 2014. Travel expenses also increased by 2.7%, contracting services increased by 8.5%, administrative expenses increased by 6.1%, and rent, communications and utilities increased by 2.8%.

Matz said it was the lowest budget increase in seven years, and that the 2015 budget allows the NCUA to perform its primary functions, adding that cutting the budget is "not an option" due to the nondiscretionary costs facing the agency.

"The only way to materially cut the budget would be to substantially cut staff," she said, adding, "Let me remind you, this agency made the mistake of cutting staff in the years leading up to the Great Recession. To keep costs down, the agency had a smaller exam force, cut back to 18 months between exams, and had fewer office staff analyzing call reports."

Metsger said the lengthy process the budget goes through ensures that the budget contains needed expenditures.

"Staff, and then the board members, review each and every position, each and every line item, each and every request, and have even reviewed each and every significant outside contract," he said. "Nothing is taken for granted. Each position, and each expenditure, must be justified. As the budget goes through its many drafts it generally goes in only one direction: down."

In casting a dissenting vote, McWatters said he was "dismayed" to see the increase in the 2015 budget, as well as with certain aspects of the budgetary process.

"I cannot in good conscience vote to approve the budget," he said. "I also will find it challenging to vote in favor of another NCUA budget unless the transparency of the budget and the budgetary process is materially enhanced and the credit union community and general public are afforded sufficient opportunity to comment on the proposed budget and the overhead transfer rate prior to action by the board."

See related story: McWatters outlines 11 enhancements for NCUA budget transparency.

McWatters outlines 11 enhancements for NCUA budget transparency

Washington
ALEXANDRIA, Va. (11/21/14)--In casting his "no" vote against the 2015 National Credit Union Administration 2015 budget, board member J. Mark McWatters outlined 11 items he said would "enhance the transparency of the budgetary process."

This is the first year the NCUA will supply additional budget documents, which include several fact sheets, as well as a FAQ document scheduled to be released in the coming weeks.

However, McWatters said he would like to see opportunities for credit union stakeholders to have a seat at the table while the agency is putting the budget together, rather than simply reading documents about a budget that has already been approved.

"Next year, I strongly encourage the board to deliver the proposed budget and calculation of the proposed overhead transfer rate (OTR) to the credit union community and general public at least two weeks prior to a formal budget hearing," he said in remarks at the agency's Thursday open board meeting.

"At that hearing NCUA staff should formally present the proposed budget and OTR to the public in a detailed, understandable and transparent manner supported by written analysis posted on the NCUA website."

He added that the board should not formally act on the proposed budget until it has reflected on the comments.

"This approach, while somewhat cumbersome, will materially enhance the transparency and inclusiveness of the budgetary process," McWatters said. "Unless there's a legal or proprietary reason not to disclose something, the default should be to disclose it. I don't understand why it should be otherwise."

Despite McWatters dissenting vote, the agency approved a 2015 spending plan that is 4.2% higher than the 2014 budget.

For future budgets, McWatters said he would like to see:
  • Additional detail regarding employee pay and benefits travel, rent/communications/utilities administrative and contracted services expenditures;

  • A detailed analysis of how NCUA may reduce those expenditures;

  • Submission of the NCUA's methodology in calculating the OTR for public comment, and a detailed description of the methodology adopted by NCUA following an analysis of the comments received;

  • A detailed analysis of expenditures among NCUA, the National Credit Union Share Insurance Fund, the Temporary Corporate Credit Union Stabilization Fund and the Central Liquidity Facility;

  • A detailed analysis of why NCUA's budget has increased by more than 50% in the past five years, as well as a year-by-year analysis of all such increases;

  • Analysis of all cost savings programs implemented by NCUA over the past five years;

  • Analysis of all expenditures incurred by NCUA to support the Financial Stability Oversight Council;

  • A detailed analysis of all expenditures incurred by NCUA in implementing the Sensitive Compartmented Information Facility;

  • A detailed analysis of all expenditures that NCUA anticipates to incur with respect to the proposed risk-based net worth rule, as well as all other proposed rules;

  • A formal cost-benefit analysis with respect to each rule or regulation proposed by NCUA, as well as a detailed description of the methodology employed by NCUA in conducting such analysis; and

  • A detailed reconciliation of how NCUA plans to allocate budget expenditures to achieve its strategic goals.
"The board's job, in my view, is not merely to follow the script set by other financial regulators, but to lead and to set the standard of transparency and accountability for all such regulators," McWatters said.

See related story: NCUA budget up by 4.2% for 2015, McWatters votes against it.

CFA/CUNA reveal 15th holiday spending survey results Monday

Washington
WASHINGTON (11/21/14)--The results of the annual consumer survey on holiday spending plans--and consumer concerns about debt levels--will be unveiled Monday at 10 a.m. (ET).
 
For the 15th consecutive year, the Consumer Federation of America (CFA) and the Credit Union National Association have joined forces just before the winter holidays to provide fresh findings on consumer attitudes towards their financial conditions and their holiday spending plans.
 
The CFA/CUNA survey was conducted just days ago, and this year's responses document the change in consumers' attitude in spending compared with last year.

The survey asks whether consumers feel their financial situation has gotten better or worse compared with a year ago and, for the first time, benchmarks any changes in household income over last year. The survey also compares spending attitudes of high- and low-income groups.
 
CFA and CUNA representatives will discuss their complete survey findings, including:
  • The latest look at consumers' holiday spending plans;
  • Consumer concern about debt and monthly payoff requirements;
  • How the findings compare with consumer attitudes last year and two years ago at this time;
  • How consumer attitudes have changed over the past 15 years; and,
  • Consumer tips for managing holiday spending this season and next.
The unveiling will be held in the Zenger Room at the National Press Club in Washington, D.C.  Speakers will be Stephen Brobeck, executive director of the Consumer Federation of America, and Mike Schenk, CUNA vice president of economics and statistics.

Other Resources

Overhead transfer rate, fee scale, NCUSIF addressed at NCUA board meeting

Washington
ALEXANDRIA, Va. (11/21/14)--The National Credit Union Administration modified the overhead transfer rate (OTR) to 71.8%, up from the current 69.2%, at its monthly board meeting Thursday.

The overhead transfer is one of the funding sources for the NCUA's budget, applied to monthly incurred expenses, and does not affect the amount of the budget.

Annual changes to the OTR are based on a methodology that was approved by the NCUA board in November 2003. The methodology considered the following key factors:
  • The value to the National Credit Union Share Insurance Fund of the insurance-related work performed by state supervisory authorities;
  • The cost of NCUA resources and programs with different allocation factors from the examination and supervision program. Allocation factors are reviewed annually;
  • The distribution of insured shares between federal credit unions and federally insured state-chartered credit unions;
  • Operational costs charged directly to the NCUSIF; and
  • The results of the annual Examination Time Survey.
The Credit Union National Association has urged the NCUA to refine its methodology related to the OTR to provide additional clarity.

The rate represents insurance-related costs in the agency's operating budget to be paid for out of the NCUSIF. The rate set at 71.8% means that 71.8% of the budget will be paid out of the NCUSIF, and the remaining 28.2% will be paid for through the federal credit union operating fee.

The operating fee is based on federal credit unions based on Dec. 31, 2014 year-end assets. Credit unions with less than $1 million in assets are not assessed an operating fee. According to the NCUA's call report data from June 2003, annual growth is projected to be 3.8% at year's end.

The fee rate was decreased in part to the July board action to reduce the 2014 operating budget by $1.1 million.

Aside from a minor increase in 2013 the operating fee rate has declined four of the last five years. Last year it was reduced 18%, said Mary Ann Woodson, chief financial officer for the NCUA.

CUNA commends the NCUA's decision for the operating fee to remain at no more than one month's expenses of the agency.

The NCUA also estimated that the NCUSIF assessment for 2015 will be between zero and five basis points, and said there will not be an assessment for the Temporary Corporate Credit Union Stabilization Fund in 2015.

Expanded foreclosure protections being considered by CFPB

Washington
WASHINGTON (11/21/14)--A government plan announced Thursday would make sure that if a mortgage borrower dies, surviving family members and others who inherit or receive property have the same foreclosure protections as the original loan holder.

The Consumer Financial Protection Bureau's plan could end up requiring mortgage servicers to  provide certain borrowers with foreclosure protections more than once over the life of a loan, to put in place additional servicing transfer protections, and to take steps to protect borrowers from a wrongful foreclosure sale.

In effect, the CFPB proposal extends the reach of bureau mortgage servicing rules that went into effect Jan. 10 this year and which require servicers to maintain accurate records, give troubled borrowers direct and ongoing access to servicing personnel, promptly credit payments, and correct errors on request.

The CFPB said in a release its proposal also would:
  • Require servicers to notify borrowers when loss mitigation applications are complete;
  • Do more to protect struggling borrowers during servicing transfers;
  • Clarify servicers' obligations to avoid dual-tracking and prevent wrongful foreclosures;
  • Clarify when a borrower becomes delinquent; and
  • Provide more information to borrowers in bankruptcy by requiring periodic mortgage staements.
The proposed rule and disclosures will be open for public comment for 90 days after their publication in the Federal Register.

The CFPB has provided a summary of the rule.

Other Resources

Rep. Hensarling names HFSC subcommittee chairs

Washington
WASHINGTON (11/21/14)--Subcommittee chairs for the House Financial Service Committee were announced Thursday by committee chair Rep. Jeb Hensarling (R-Texas). This will be Hensarling's second term as chair of the committee after taking the position in January 2013.

The subcommittee chairmen for the 114th Congress will be:
  • Rep. Scott Garrett (R-N.J.), capital markets and government-sponsored enterprises subcommittee;
  • Rep. Randy Neugebauer (R-Texas), financial institutions and consumer credit subcommittee;
  • Rep. Blaine Luetkemeyer (R-Mo.), housing and insurance subcommittee;
  • Rep. Bill Huizenga (R-Mich.), monetary policy and trade subcommittee; and
  • Rep. Sean Duffy (R-Wis.), oversight and investigations subcommittee.
Hensarling said in a statement that he looks forward to passing laws to help grow the economy while "promoting sensible solutions that help create jobs and hold both Washington and Wall Street accountable to the American people."

The remainder of the committee leadership team will be announced at a later date.

Other Resources

Consumer Rates

Market

Informa Research Services, Inc.
Daily Rate Comparison

Informa Research Services, Inc.
Deposit Products Credit Unions Bank Average Difference
12 Month CD $10,000 0.48% 0.28% 0.20%
Personal Savings $1,000 0.20% 0.10% 0.10%
Personal Interest Checking $2,500 0.36% 0.15% 0.21%
NSF Fee $27.90 $30.66 $-2.76
Personal MMDA $2,500 0.17% 0.10% 0.07%
Business MMDA $2,500 0.17% 0.09% 0.08%

Consumer Loan Products Credit Unions Bank Average Difference
Unsecured Personal Loan - $5,000 - 4 Years 10.13% 10.30% -0.17%
New Auto Loan - 5 Years 2.62% 3.83% -1.21%
Used Auto Loan - 2 year Old - 4 Years 2.78% 4.01% -1.23%
HELOC - 80% LTV - $50,000 4.12% 4.38% -0.26%
HE Loan - 80% LTV - $50,000 - 15 Years 5.67% 5.91% -0.24%

Mortgage Loan Products Credit Unions Bank Average Difference
30 Year Fixed Conforming 3.99% 4.05% -0.06%
30 Year Fixed Jumbo 4.09% 3.99% 0.10%
5/1 Year ARM Conforming 2.94% 2.88% 0.06%

Credit Card Products Credit Unions Bank Average Difference
Platinum 8.86% 10.50% -1.64%
Annual Fee $25.00 $31.00 $-6.00
Maximum Late Fee $25.64 $33.45 $-7.81
Reward 10.08% 13.33% -3.25%
Annual Fee $26.81 $98.57 $-71.76
Maximum Late Fee $22.68 $33.71 $-11.03

Indirect Auto Loan Products Credit Unions Bank Average Difference
Indirect A Tier New Auto Loan - 5 Years 3.59% 3.62% -0.02%
Indirect B Tier New Auto Loan - 5 Years 5.31% 5.20% 0.12%
Indirect C Tier New Auto Loan - 5 Years 7.47% 6.65% 0.82%

Averages displayed are straight averages of all institutions within the Informa Research Services database for the selected region as of Thursday, November 20, 2014. For detailed disclosures click here.

Other Resources

Business Rates

Market
Daily Financial Rates -- 2014-11-21

Financial Rates


Friday, November 21, 2014

03:55 AM CST

TREASURY YIELD CURVE
(based on the $1 million market)

TermFri
11/21
Thu
11/20
Wed
11/19
Tue
11/18
Mon
11/17
1 month0.040.040.040.020.04
3 month0.020.010.020.030.02
6 month0.070.070.070.070.07
1 year0.140.150.140.150.15
2 year0.530.540.530.540.54
3 year0.970.990.960.960.96
5 year1.641.661.631.641.62
7 year2.052.072.032.042.02
10 year2.342.362.322.342.32
20 year2.782.802.772.792.77
30 year3.053.083.053.063.04

TREASURY BILLS

Results of the November 17, 2014 auction of short-term U.S. government bills, sold at a discount from face value in units of $10,000 to $ 1 million

TermLatest
Mon, 11/17
Week Ago
Mon, 11/10
13 weeks0.0250.025
26 weeks0.0700.060

PRIME RATE

3.25% Last changed December 16, 2008

FEDERAL FUNDS

TermFri
11/21
Thu
11/20
Wed
11/19
Tue
11/18
Mon
11/17
high0.3120.3120.3120.3120.312
low0.0700.0600.0700.0700.050
near closing bid0.0800.0500.0800.0800.070
offered0.1000.0800.1000.1000.100
effective rate20.1200.1200.1300.1100.110

FREDDIE MAC (Mortgage commitments, 30 days)

TermFri
11/21
Thu
11/20
Wed
11/19
Tue
11/18
Mon
11/17
30 year0.000.000.000.000.00

FANNIE MAE (Mortgage commitments, 30 days)

TermFri
11/21
Thu
11/20
Wed
11/19
Tue
11/18
Mon
11/17
30 year3.5573.5693.5583.5563.600

LIBOR

TermFri
11/21
Thu
11/20
Wed
11/19
Tue
11/18
Mon
11/17
1 month0.230000.225000.230000.231000.22900
3 month0.374000.372000.372000.374000.37100
6 month0.539000.539000.538000.539000.53800
1 year0.841000.841000.840000.841000.84100

COMMERCIAL PAPER (Financial, 90 days)

TermWeek ended
11/18
Week ended
11/4
90 days0.230.23

NA: Data not available at time of page generation (shown at top of page)

Sources:
Wall Street Journal
U.S. Dept. of the Treasury


All rates are from the previous business day unless otherwise noted.

Other Resources

Consumer prices continue to flatline

Market
WASHINGTON (11/21/14)--Consumer prices continue to make little progress in pushing inflation up toward the Federal Reserve's target number of 2%, as the consumer price index (CPI) remained unchanged in October, keeping headline inflation at 1.7% above its year-ago levels, the Bureau of Labor Statistics reported Thursday (Economy.com Nov. 20).

While core prices, which climbed 0.2% for the month, came in stronger than analysts had anticipated, falling energy prices, including the price of oil, continue to hinder gains in price growth, Moody's said.

The gasoline index dropped for a fourth consecutive month, falling 3% in October and 8% total over the last three months. Natural gas and fuel prices also have slipped of late, pushing the overall energy index down 1.9%.

"The large decline in energy components was no surprise," said James Bohnaker, Moody's analyst (Economy.com Nov. 20). "Oil prices plummeted early in the month and have not rebounded. Brent and West Texas Intermediate crude oil are both trading at less than $80 per barrel, down from $100 in mid-summer."

Food, meanwhile, recorded only a 0.1% jump in prices, its smallest increase since June, as meat prices dropped 0.4%.

The gains in the core CPI were driven by rent prices and other service costs, according to Moody's. The shelter index (rent) advanced 0.2%, and has climbed 3% since this time last year. Other household-related prices, including household furnishings and lodging, also posted increases.

"Rental costs will grow strongly over the next year as household formation picks up, particularly among younger cohorts in large urban areas," Bohnaker said. "The homeownership rate has shown no sign of coming back, so most pent-up demand for housing will be funneled into the multifamily segment in the near term."

Other Resources

Existing-home sales jump in Oct.

Market
WASHINGTON (11/21/14)--After stumbling late in the summer, existing-home sales have rebounded with a 1.5% jump in October to 5.26 million annualized units sold on a seasonally adjusted basis, according to the National Association of Realtors (Economy.com Nov. 20).

Existing-home sales also sit 2.5% higher than levels seen at this time last year, with three out of four U.S. regions posting monthly gains.

The South posted the highest climb month-over-month (5.3%), trailed by the Midwest (5.1%) and the Northeast (4.4%). The West was the only region not to record an increase in sales.

National single-family home inventory fell 3% to 1.96 million units in October, potentially signaling a modest tightening in that segment of the market, according to Moody's analysts.

Inventory remained 5.4% above levels seen in October 2013, however.

Condo and co-op sales have not picked up as much speed as single-family homes, but they are beginning to climb, Moody's said, recording a 3.3% jump from September.

The median sales prices for single-family homes fell to $208,700 in October, sitting 5.6% higher year-over-year, while the average single-family home price has jumped 4.1% annually.

"In terms of sales volume, the housing market has almost pulled out of its slump in the first quarter of 2014, and the steady upward trend in prices is also a good sign of excess demand," said Andres Carbacho-Burgos, Moody's analyst (Economy.com). "The median existing single-family home price is well on its way to regaining the 2005 peak by the end of next year."

While single-family home construction has taken the slow road in its recovery from the recession, single-family starts are expected to hasten next year, especially if the labor market continues to tighten and the labor force and household formation continued to climb, Carbacho-Burgos said.

Other Resources

Experts: Expect more breaches during holiday season

CU System
NEW YORK (11/21/14)--It's probably the last thing credit unions--which have been saddled with millions of dollars in costs as a result of recent mega-retailer data breaches--want to hear, but many experts are forecasting a new round of cyberattacks on payment data held by merchants this holiday season. 

"It's just a matter of when they're going to get hacked, not if," Robert Twitchell, president/CEO of the cybersecurity firm Dispersive Technologies, which serves as a consultant to the U.S. Department of Defense in its war against cybercrime, told the International Business Times (Nov. 18).

"It would be a surprise if it doesn't happen again," added John Rose, Boston Consulting Group's global leader. "The cyberattack community is equally aware of the importance of the holiday season, and they've been working on things for a while, so you're going to see an intensity of effort."

Unwelcome news compounded by the fact that merchants continue to operate under payment data security standards that don't match the strict standards financial institutions are required to meet.

Twitchell said that merchants may spend more on safeguarding payment data than in the past, but it still may not be enough to ward off cybercriminals.

"IT organizations have paid attention only to the ABCs of hacking," Twitchell said. "They're adhering to PCI compliance, a government standard of basic security, but the standard hasn't kept up with innovation."
And Twitchell isn't the only one worried about payment security at merchant stores.

Brian Krebs from KrebsOnSecurity.com, a cybercrime blog, said that he expects a new major breach will surface in only the next few weeks.

"The retail industry is just the lowest of the low-hanging fruit when it comes to cybersecurity," he said on "CBS This Morning."

Retailer security performance continues to decline as well, according to the security benchmarking firm BitSight (TechWorld.com Nov. 18), especially for those who have yet to come under attack.  

While a number of retailers that have been hit with breaches have seen improvements in security performance, BitSight found that 58% of the 300 merchants it polled recently had experienced a 90-point decline in performance over the first three quarters of 2014 on a scale that runs from 250 points to 900.

The Credit Union National Association has been on the forefront of the effort to press lawmakers on the issue of unequal payment data security requirements between financial institutions and merchants.

Credit unions nationwide suffered $57 million in costs related to the recent Home Depot data breach, including card reissuances and other fraud-related costs, after getting hit with $30 million in costs from the breach that occurred at Target stores last holiday season.

Meanwhile, the stakes for those that hold sensitive consumer payment data continue to rise. So far this year, 644 breaches have been reported, a 25.3% increase from last year, according to Theft Resource Center (Pymnts.com Nov. 19).

Further, Federal agencies have warned businesses in the United States that hackers are becoming more sophisticated and organized, and even the Chinese government has been sponsoring cyberattacks in search of patented technologies, according to the International Business Times.

The attacks will also continue to evolve, it appears, as Trend Micro predicts that data breaches will migrate to mobile devices carrying personal payment data next year, according to Pymnts.com.

"In 2015, we expect attackers to hack smart device-markers' databases to steal information," Trend Micro reported.

The company also said that a more diverse range of targets will come under fire from cybercriminals, but that personal financial information will continue to be the most hunted data.

It's all about the bird for CU charity at Thanksgiving

CU System
MADISON, Wis. (11/2114)--As the daily temperature drops in most parts of the country, credit unions nationwide have already begun warming hearts with holiday charitable events and celebrations.
 
Click to view larger imageEmployees at $410 million-asset Dover (Del.) FCU collected nonperishable items at all of its branches. (Dover FCU Photo)
Dover (Del.) FCU is participating in the annual Turkey Round Up, a program that helps the Food Bank of Delaware collect and distribute turkeys and nonperishable food to families in need during the holiday season. Dover FCU awarded each of its employees a $20 turkey gift voucher. Employees were given the option to donate their vouchers to the Turkey Round Up program so that turkeys could be purchased for hungry state residents.
 
The $410 million-asset credit union also collected nonperishable items and monetary donations at all of its branch locations. The combined efforts of employees and Dover FCU members raised $1,585.83 and filled six large bins with food for the holidays.
 
Click to view larger imageParticipants in last year's Pacific Marine CU Turkey Trot in Oceanside, Calif., celebrated the event's Thanksgiving Day theme. (Pacific Marine CU Photo)
Pacific Marine CU, Oceanside, Calif., with $707 million in assets, is sponsoring the ninth annual Oceanside Turkey Trot on Thanksgiving Day. The PMCU Oceanside Turkey Trot has raised more than $160,000 for local charities in the last eight years (U-T San Diego Nov. 16).
 
Participants can designate their entry fees toward local schools and nonprofits. The event also supports the Move Your Feet Before You Eat Foundation, a charity that promotes health and physical activity among young people.
 
On Tuesday, Bethpage (N.Y.) FCU, with $5.6 billion in assets, sponsored the sixth annual Bethpage Turkey Drive to benefit Island Harvest food bank.
 
Click to view larger imageLocal firefighters are among those who assisted in the sixth annual Bethpage Turkey Drive, sponsored by Bethpage (N.Y.) FCU. (Bethpage FCU Photo)
Long Islanders donated frozen turkeys, nonperishable food items and cash donations. One generous giver donated 80 turkeys (Newsday Nov. 20). The donations helped supply Thanksgiving holiday meals to the more than 300,000 hungry Long Islanders.
 
Credit Union 1, Rantoul, Ill., with $768 million in assets, is hosting a food drive this month. Members and employees are welcome to donate money or nonperishable food items. Food donations will go to a local food pantry that each branch has selected in the communities served by the credit union. Monetary donations will go to Feeding America.
 
In addition to hunger relief, credit unions focused on other "people helping people" efforts:
  • Members and staff of Ideal CU, Woodbury, Minn., with $567 million in assets, once again helped to fill collection barrels to ensure kids in the Twin Cities metro area receive new or gently used coats this winter;
     
  • A total of 224 coats and 123 winter accessories were collected at Ideal CU branch locations throughout the year, culminating with the October Salvation Army Coats for Kids Drive. In addition, the Ideal Community Foundation donated $2,500 from Casual for a Cause and other contributions, which the Salvation Army will use to buy 156 more coats for needy children;
     
  • On Dec. 6, Evolve FCU, El Paso, Texas, with $300 million in assets, will present the 2014 Celebration of Lights, El Paso's traditional holiday lighting ceremony. Since it first began in 1935, the Celebration of Lights has been one of the most celebrated traditions in the Sun City;
     
  • Mid Oregon CU, Bend, Ore., with $185 million in assets, is supporting local charities through the Holiday Dough Fund. Cash donations will help provide food, clothing and shelter for individuals and families within the local community as well as toys for kids; and
     
  • Georgia United CU, Duluth, Ga., with $981 million in assets, is holding its 25th annual Wish Tree program to collect new toys and clothing for deserving children through local charitable organizations or the state Division of Family and Children Services.
 

Other Resources

Credit scores, card use on rise: Experian annual credit study

CU System
COSTA MESA, Calif. (11/21/14)--2014 has been a year for borrowing and for boosting credit scores, according to Experian's recently released State of Credit report.
 
Click to view larger imageExperian Graphic
The credit bureau's fifth annual report shows card lending and credit scores experiencing signs of growth since last year.
 
New bank-card accounts are up 21.1%, with one in 17 consumers opening at least one new account in 2014 compared with one in 21 in 2013.
 
"This has been a notable year for borrowing, with more new credit being extended and consumers feeling more comfortable and confident about accepting those credit offers," said Michele Raneri, Experian vice president of analytics. "Even with some categories like mortgages taking longer to bounce back, an early glimpse at our third-quarter data indicates that an upward trend may be on the horizon."
 
Experian reported a 39% decline in mortgage originations year-over-year with one in 79 households taking out a new mortgage compared with one in 48 in 2013. The bureau's projections indicate originations will increase 6.8% in the third quarter from the second quarter.
 
The national average VantageScore ticked up two points to 666 from 664. Of the more than 100 metropolitan statistical areas Experian surveyed, Minnesota had four of the top 10 highest average credit scores with 699 or above.

League-supported fin. lit. bill among 1st filed for Fla. session

CU System
TALLAHASSEE, Fla. (11/21/14)--With support from the League of Southeastern Credit Unions, a bill requiring high school students to take a financial literacy course has once again been filed in the Florida Senate.
 
The legislation, which was filed by Sen. Dorothy Hukill (R-Port Orange), would reduce elective credits to seven-and-one-half from eight, beginning with students entering the ninth grade in the 2015-2016 school year. Instead, each student will be required to take one-half credit in personal financial literacy and money management.
 


"The league worked closely with the bill's sponsors on this legislation," Patrick La Pine, LSCU president/CEO, told News Now. "Credit unions have a long history of providing financial literacy to local schools. This legislation helps to take that a step further by making it a requirement. When the legislation passes, credit unions have an opportunity to help bridge the financial literacy gap for students."
 
Instruction and discussion will focus on types of accounts, how to balance a checkbook, loan applications, insurance policies, taxes and investments.
 
The LSCU said its governmental affairs team will continue to work closely with the bill sponsors and a coalition of advocacy partners for the legislation. The league will be guided by recommendations from a financial literacy task force made up of credit union representatives from across Florida.
 
The goals for the league-appointed task force are legislative advocacy, grassroots efforts and serving as resource for teachers and students. The task force will work to pass the legislation and serve as a resource during the implementation process. 
 
By assisting in financial literacy efforts, credit unions can provide real-life examples of financial challenges that consumers face each day, said Heather Fitzenhagen (R-Fort Myers), one of the bill's co-sponsors.
 
Also, Hukill filed SR 106, a resolution recognizing April 2015 as Financial Literacy Month in Florida. LSCU is cited in the resolution for its efforts to teach financial literacy to as many people as possible through programs such as the National Endowment for Financial Education's High School Financial Planning Program, Biz Kid$, Money Mission, reality fairs, seminars and workshops.

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MCUA orientation welcomes newly elected state lawmakers

CU System
JEFFERSON CITY, Mo. (11/21/14)--The Missouri Credit Union Association (MCUA) has created an opportunity for state credit union leaders to meet freshly elected legislators face-to-face before they officially take office next year.

The Missouri league's freshman orientation lunch with state legislators will take place Dec. 3 in Jefferson City. Roughly 35 state lawmakers--those who won election in 2014, staff members and sophomore legislators beginning their second terms in January--will attend the event.

"This is an excellent way to meet with newly elected lawmakers and establish or build on relationships before the session begins," said Amy McLard, league senior vice president of advocacy (Missouri Difference Nov. 18). "We hope that credit union representatives statewide will take part, especially those that have new lawmakers representing their region."

The Credit Union National Association has developed materials to guide leagues for meetings with new members of the 114th Congress as well.

Materials include an outline that details talking points such as a general introduction to credit unions, efforts to preserve credit union tax status, reducing regulatory burdens imposed upon credit unions and information on merchant data breaches.

For more information about the Missouri league's event, or to RSVP, contact Director of State Legislative Affairs David Kent at dkent@mcua.org. RSVPs must be received by Dec. 1.

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New Filene tool helps CUs optimize member experience

CU System
MADISON, Wis. (11/21/14)--A new white paper from the Filene Research Institute describes how credit unions can optimize their delivery channels to enhance member satisfaction.
 
The paper also introduces a software tool to assist with that process.
 
This research outlines examples of organizations--both inside and outside of retail financial services delivery--that have been successful at optimizing the customer experience.
 
The report outlines how to leverage Filene's member experience design tool (http://custexp.filene.org/) through five steps:
 
  • Step 1: Identify specific delivery channels and attributes valued by your target members;
  • Step 2: Order attributes from most to least important from the perspective of the credit union's target members;
  • Step 3: Provide an honest assessment of the credit union's most important competitor's performance on those same attributes;
  • Step 4: Choose an institution to run a comparative analysis against based on the attributes selected by the credit union as most and least important; and
  • Step 5: The tool will generate a descriptive analysis on the advantage, if any, between the credit union and the chosen competitor.
Once credit unions have defined and ranked the most important attributes of the member experience, they can map out their capacity to deliver on those attributes. Ultimately, this practice will help identify systematic opportunities to optimize the member experience across various channels, the paper said.

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Available spots dwindling quickly for Jan. DE training

CU System
MADISON, Wis. (11/21/14)--Only a handful of spots remain for next year's Credit Union Development Education training program that will take place Jan. 14-21 in Dallas.

The spring class, set for April 29-May 6 in Madison, Wis., is also about half full, according to the National Credit Union Foundation (NCUF), which sponsors the trainings.  

"Registration for each training is limited to just 42 attendees and we only have about 10 spots left for credit union professionals who would like to attend the January training," said Lois Kitsch, NCUF national program director. "You don't want to miss either of the 2015 programs, as DE Training is one of the most transformative and unique credit unions training events offered."

The training lasts six days and teaches credit union professionals about social responsibility and domestic and international development through interactive education and professional networking.

Registration for the trainings can be accessed on the NCUF's website under the "Register for DE Training" button on the homepage.

The registration fee includes seven nights of single-room lodging in addition to all training materials and meals.

The program is open to anyone from new credit union employees to veteran credit union executives looking for a refresh in the industry. Those interested in learning more about the training can view a video the NCUF has put together a video on the program (News Now Nov. 5).

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3 nominations received for CUNA board election

CU System
MADISON, Wis. (11/21/14)--The Credit Union National Association has so far received three nominations for open director positions on the trade association's board.
 
Two nominations have been submitted for District 5, Class A.  This seat represents credit unions having less than 28,000 natural-person members in Arizona, Colorado, Kansas, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah and Wyoming.
 
Nominees are Winona Nava, president/CEO, Guadalupe CU, Santa Fe, N.M., with $135 million in assets; and Donna Neal, president/CEO, My Community FCU, Midland, Texas, with $299 million in assets.
 
Peter Dzuris, president/CEO, Northland Area FCU, Oscoda, Mich., with $279 million in assets, has been nominated for District 4, Class B, which represents credit unions having at least 28,000 but not more than 100,999 natural-person members in Illinois, Iowa, Michigan, Minnesota, Missouri and Wisconsin.
 
The deadline for nominations is Dec. 15, and official ballots will be sent Dec. 29.
 
Other open seats are:
 
District 1--Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Puerto Rico and Virgin Islands:
  • Class B: Credit unions having at least 28,000 but not more than 100,999 natural-person members.
District 2--Delaware, District of Columbia, Indiana, Kentucky, Maryland, Ohio, Virginia and West Virginia:
  • Class C: Credit unions having at least 101,000 natural-person members.
District 3--Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee:
  • Class A: Credit unions having less than 28,000 natural-person members; and
  • Class D: League presidents.
District 4--Illinois, Iowa, Michigan, Minnesota, Missouri and Wisconsin:
  • Class D: League presidents.
District 6--Alaska, California, Hawaii, Idaho, Nevada, Oregon, Washington, American Samoa, Guam, Johnston Atoll, Midway Atoll, Northern Mariana Islands, Palmyra Atoll and Wake Atoll:
  • Class C: Credit unions having at least 101,000 natural-person members.

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Longer car loans detrimental to consumers' finances

Consumer
WASHINGTON (11/18/14)--A longer-term loan can make even the most expensive car look affordable.
 
By stretching out the loan over many years, your monthly payment is likely lower, but you could end up paying a lot more in interest. Still, many people find such loans attractive. 
 
The average new car loan is now 67 months, according to Edmunds.com--the second-highest average term on record (Washington Post Nov. 12). Almost 25% of vehicle loans made in the second quarter of 2014 were for 73 to 84 months, according to Experian.
 
That's well above the standard three- to four-year loan that used to be typical for new car purchases. Here are some of the problems with taking out a longer car loan:
  • The longer the term of the loan, the worse your interest is likely to be. Shorter-term loans generally qualify shoppers for a better rate;
     
  • There's a greater chance you'll end up underwater. Without a substantial down payment, if you total the car or need to sell it, you could up receiving less than you owe on the loan; and
     
  • You're stuck with the car even if you don't want it anymore. If you want to buy a different vehicle, you likely won't be able to trade in your car because of the difference between what you owe and what the dealer is willing to pay for it.
If you need a longer car loan just so you can afford to buy the car, that's probably a good sign that you can't afford the car in the first place. Keep your loan at 48 months, and visit your credit union for preapproval on a loan before you even begin shopping.
 
That way you know exactly how much you can afford, and you can avoid taking out a loan that's going to be a financial burden long after the new car smell has evaporated.
 
If you have an auto loan from another financial institution, your credit union can help you refinance to a shorter term but still help you stay with an affordable payment.
 
For related information, read "Keep Your Old Car Running Longer" in the Home & Family Finance Resource Center.

Box Elder County FCU adds Buzz Points loyalty program

Products
BRIGHAM CITY, Utah (11/21/14)--Box Elder County FCU has selected the Buzz Points merchant-funded loyalty program for its members.
 
Buzz Points is a CUNA Strategic Services alliance provider.
 
The program is free and allows members of the $95 million-asset, Brigham City, Utah-based credit union to earn rewards while supporting the local economy by using their debit cards for everyday shopping.
 
"Box Elder CU is not controlled by the boardrooms of distant companies; we are 100% local and a proud part of our community," said Tonya Gail, Box Elder County FCU marketing director. "We chose Buzz Points because we wanted to reward our [members] for shopping locally, while also nurturing independently owned businesses and supporting our local economy. Buzz Points will make our members' money work harder for them and give our hardworking business owners the data analysis and marketing tools they need to thrive and contribute to the rich fabric of our community."
 
Buzz Points is the only merchant-funded rewards platform that works with community financial institutions and local businesses to engage mutual customers. Credit union members can earn points by using their debit cards whenever they shop, but they earn more points for shopping locally and the most points for shopping with local businesses enrolled in the program.
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