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CU System briefs (01/11/2011)

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* TOTOWA, N.J., and PATERSON, N.J. (1/12/11)--The snowstorm that hit the northeast early this week has delayed the ribbon-cutting ceremony for a student-run branch of North Jersey FCU at Paterson, N.J., Public Schools. The event was supposed to be today, but has been moved to 10 a.m. ET on Jan. 18. Twenty-seven students from grades 10-12 have been trained to operate the new credit union branch at JFK High School in Paterson. They will be supervised by a teacher and full-time credit union employee, but students will have primary responsibility for the branch. The group participates in the school's Business, Technology and Marketing Academy, and will develop marketing promotions and creative initiatives for the branch … * WHITEFISH, Mont. (1/12/11)--Whitefish (Mont.) CU is helping out Glacier Bank whose Eureka branch was destroyed by fire in October. The bank said construction on a new branch at the site will begin in March and is expected to be completed in November. In the weeks after the fire, Glacier Bank employees used space provided by the $1.2 billion asset credit union and a local bank. Now the employees are working from a modular building. Fire officials have determined the fire was an accident (Associated Press Newswires Jan. 10) … * ST. PETERSBURG, Fla. (1/12/11)--PSCU Financial Services announced it will continue sponsorship of The Colonial Williamsburg Foundation's (CWF) initiative to educate students on the nation's democratic principles and foundation. The St. Petersburg-based credit union service organization (CUSO) is funding 50 schools nationwide to receive seven monthly electronic field trips to bring American history to life for elementary and middle-school students through streaming video productions with interactive question-and-answer sessions. "We are continuing this sponsorship in honor of our late CEO Dave Serlo, who passionately believed American youth need to understand the principles and responsibilities of our democratic government to ensure that our heritage of freedom and democracy is passed down to future generations," said Mike Yatros, interim CEO of PSCU Financial Services. The CUSO said it encourages credit unions to provide scholarships for local schools. Electronic field trips cost $500 for a series of seven events during a school year. The fee registers all participating teachers and students in one school …

Branch manager injured in robbery

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GERMANTOWN, Md. (1/12/11)--A branch manager was injured Saturday when he was thrown over the counter during a robbery at his credit union in White Oak, Md. According to local news reports, two armed men entered the branch of Mid-Atlantic FCU Saturday at about 10:42 a.m. They announced the robbery and attacked the manager (Associated Press Newswires and Colesville.Patch.com Jan. 10) . Although initial reports indicated there were no injuries, police later told local media the manager had suffered a possible broken leg that required medical attention when he was tossed over the counter. The suspects left the area in a small, dark-colored van with an undisclosed amount.

Third suspect arrested in ATM shooting

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GAINESVILLE, Fla. (1/12/11)--A third suspect has been arrested in an attempted murder and robbery Dec. 16 at an ATM at a Gainesville, Fla.-based credit union. Alachua police arrested Akil Flagg at his residence on Dec. 30 in connection with the incident (Alachuacountytoday.com Jan. 9). He was found hiding in an air conditioning vent inside the residence but was arrested without incident. A man was shot at while retrieving cash from an ATM at SunState FCU in Alachua at about 11:15 p.m. Dec. 16. He had withdrawn cash from the ATM, returned to his car and was leaning forward to start the engine when a gunshot shattered the driver's side window of the car. He was not hit but drove to the police department, where he told police he noticed a white Fort Explorer nearby (News Now Dec. 20). Two suspects, Derae Jenkins, 18, and Richard Addison, 24, both of Gainesville, were arrested earlier. Addison was caught while fleeing with two other men from a sports utility vehicle parked near the ATM. Jenkins was arrested Dec. 23, said the Alachua newspaper. Police found a gun inside the vehicle, which had been reported stolen two days earlier.

Small FIs ahead of big banks in wooing Mass. consumers

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FAIRHAVEN, Mass. (1/12/11)--Although big national banks have begun adding branches and beefing up services to woo Massachusetts' consumers, local credit unions and community banks are already "ahead of the game," said a Fairhaven, Mass., newspaper. "Community banks and credit unions have capitalized on dissatisfaction with national financial giants by adding new branches in the region over the past year," said the SouthCoastToday.com (Jan. 9). The newspaper noted that more than half of major banks plan to add branches or maintain existing ones because the branch is where most account openings take place. They are looking to turn basic checking accounts into more lucrative relationships by focusing more on service, the article said. The newspaper also interviewed local credit unions and community banks about their growth. Southern Mass CU, a $177.3 million asset credit union in Fairhaven, last year added a full-service branch in Bedford, and it plans to open a branch in Fall River in about two years. It also has a branch office at Fairhaven High School during the academic year. "We began our expansion plan development several years ago and selected the New Bedford location long before the recent trend of other financial institutions adding more branches and services," Southern Mass CU President/CEO Daniel Waltz told the publication. "The opening of our first full-service branch office just happened to coincide with this recent trend." He agreed national banks are trying to emulate smaller financial institutions that offer competitive services. "Consumers have recognized this and have been moving their financial account relationships from large, nationwide banks to community credit unions and banks such as Southern Mass CU where they receive personalized service and know we are always looking out for their best interests," Waltz said.

CUs credit card clunkers program finds success

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NAPERVILLE, Ill. (1/12/11)--Leyden CU has adapted the “Cash for Clunkers” program to the credit card market, helping the Franklin Park, Ill.-based credit union serve its mission and offering members a way to get their debt under control. The program was initiated in August 2009, around the time of the federal government’s “Cash for Clunkers” auto program. Leyden CU CEO David Lukas decided to try something in similar to help members get out from under overwhelming debt they held on bank credit cards. Because it realized losses in the past with debt consolidation programs, the credit union entered the program with caution by first surveying members through its online banking site to gauge interest. The response was positive, and the credit union went forward with the program. To participate, members submit their worst, or “clunker,” bank credit card. In return, members who meet lending criteria are granted a three-year loan at 9% interest--the same interest rate as the credit union’s VISA Gold card. Once the loan is paid off in good standing, members can then re-apply for another loan to pay off other credit cards. Lukas said participation in the program has been modest, but those who take part are pleased with it. In fact, he described a few members who held $25,000 in credit card debt with interest rates up to 30%. “That’s something they were never going to be able to pay off,” he said. Lukas described the program as a success. In the year since it rolled out, the program has provided more than 40 loans, with low delinquencies and no charge-offs. Two members paid off their loans early and are starting on their second ones. At this point, the program is open-ended, Lukas said. “This is just one thing we can do to be true to our mission statement and help others along the way,” he explained.

Fees expert Low incomers will leave banks for CUs

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MADISON, Wis. (1/12/11)---Expect to see lower-income bank customers leave bigger banks for more affordable options, such as credit unions, a fees consultant who advises banks and credit unions told Public Radio International on Monday. With new rules for cards and overdraft fees, banks will try to find profits in other places, such as fees, according to the report. Mike Moebs, a consultant based Lake Bluff, Ill., said he expects banks to start charging customers fees for low balances, not having multiple accounts with the bank and not banking online. “They’re basically shedding themselves of accounts they can’t make any money at,” Moebs said. Those types of fees will hit low-income consumers especially hard, and they will look for “cheaper options like credit unions,” he added.

LSCU CUs take part in Fla. governors inauguration

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BIRMINGHAM, Ala. and TALLAHASSEE, Fla. (1/12/11)--Republican Rick Scott was sworn in as Florida’s 45th governor Jan. 4, and the League of Southeastern Credit Unions (LSCU)--representing credit unions in Alabama and Florida--and seven Florida credit unions attended the event and participated in the day’s festivities.
Republican Rick Scott (center) is sworn is as Florida’s 45th Governor Jan. 4. The League of Southeastern Credit Unions--representing credit unions in Alabama and Florida--and seven Florida credit unions attended the event and participated in the day’s festivities. (Photo provided by the League of Southeastern Credit Unions)
The league was one of the sponsors of the inauguration and helped credit unions have access to a prayer breakfast at Florida A&M, the swearing-in ceremony, inaugural parade and inauguration ball. Attending the inaugural ball were Larry Tobin, CEO of Fairwinds CU in Orlando; Brent Lister, CEO of First Florida CU in Jacksonville; Cecilia Homison, CEO of Florida Commerce CU, Tallahassee; and Patrick La Pine, LSCU president/CEO. Among those attending the swearing-in ceremony were Lisa Brown, CEO of Tallahassee-Leon FCU in Tallahassee; Steven Nazurak, CEO of Tallahassee (Fla.) FCU; Clarence Rivers, interim CEO of Florida A&M University FCU in Tallahassee, and LSCU staff. Darrell Worrel, CEO of Envision CU in Tallahassee, along with Brown, Rivers and Homison attended the prayer breakfast. At the inaugural, which included six former governors, Scott talked about the steps needed to get Florida back on track. “We have to remember that modern businesses can locate anywhere,” Scott said. “If the conditions Florida offers aren’t the best, businesses go elsewhere. What does it take to create that favorable business climate? Florida has to offer the best chance for financial success. Not a guarantee--just the best chance. Three forces markedly reduce that chance for success--taxation, regulation and litigation. Together those three form ‘The Axis of Unemployment’. Left unchecked, they choke off productive activity.” Scott issued several executive orders that included: the suspension of rulemaking and the establishment of an Office of Fiscal Accountability and Regulatory Reform, the verification of employment status, ethics and open government, and reaffirmation of commitment to diversity in government. Also included was the Code of Ethics from the Executive Office of the Governor, effective Jan. 4. The involvement of LSCU is a continuation of a commitment to build relationships with elected officials in the state and elevate the visibility of the credit union industry, said LSCU.

WOCCU calls for WYCUP nominations

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MADISON, Wis. (1/12/11)--The World Council of Credit Unions (WOCCU) is accepting nominations for the 2011 WOCCU Young Credit Union People (WYCUP) Scholarship Program, which promotes international education and networking opportunities for credit union professionals and volunteers under age 35.The deadline for nominations is June 14.
Click to view larger image Pete Crear, president/CEO of World Council of Credit Unions (left), presented 2010 WYCUP Scholarships to winners, from left, Christie-Anne Scott, Australia; Carol Karugu, Kenya; Orla O’Shea, Ireland; Melia Keller, U.S.; and Scott Daukas, U.S. The presentation took place at The 1 Credit Union Conference in Las Vegas in July. (Photo provided by World Council of Credit Unions)
The WYCUP Scholarship Program seeks individuals who have made significant contributions to the development of their credit unions, or regional or national credit union systems, and have demonstrated the potential to employ their talents at the international level. Credit unions and credit union organizations that are WOCCU members can nominate their candidates to compete for the scholarship. “Over the past decade nearly 500 young credit union professionals and volunteers have passed through the program,” said WOCCU Director Ron Hance, president/CEO of Heritage Family CU in Rutland, Vt., and chair of the WOCCU Awards Committee. “The hallmark of any profession is its willingness and commitment to train the next generation of leadership, and the WYCUP program helps the global credit union movement to fulfill that mission.” To be eligible for the scholarship, nominees must:
* Be sponsored by their credit union or credit union organization to attend the 2011 World Credit Union Conference in Glasgow, Scotland, in July; * Be 35 years of age or younger on Jan. 1, 2011; and * Submit a completed nomination form to WOCCU with supporting materials no later than June 14.
The WYCUP Scholarship, which consists of an all-expense-paid trip to the 2012 World Credit Union Conference in Gdansk, Poland, will be awarded to five recipients at the 2011 Glasgow conference. All WYCUP nominees, regardless of award status, will be formally recognized in Glasgow and invited to take part in events and networking sessions organized throughout the conference for participants under age 35. Conference registrants age 35 and under also qualify for a discounted registration fee regardless of whether or not they compete for the scholarship. “The energy and enthusiasm that comes out of the WYCUP program is intoxicating,” said WYCUP founder Dave Grace, WOCCU senior vice president of association services. “Dozens of lasting connections among young professionals are created each year.” For more information, use the link. For questions about WYCUP, contact Liliana Tangwall at ltangwell@woccu.org or call 608-395-2043.

One year later Haiti CUs poised for comeback

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PORT-AU-PRINCE, Haiti (1/12/10)--Piles of rubble and acres of tents still dominate the skyline of Haiti, a country in which supplies remain scarce, violence sometimes threatens and the struggle for survival continues. But one year after the most devastating earthquake in the country's history, hope looms on the horizon as Haiti's caisse populaires--credit unions--begin their slow comeback.
Click to view larger image Massive piles of rubble caused by last year's earthquake still wait to be cleared in Haiti's capital, Port-au-Prince.
It's a comeback built on financial assistance from the global credit union movement and the will to once again serve members in dire need, said a release from the World Council of Credit Unions (WOCCU). "Haiti's credit unions have a determination and resolve like none I've ever seen," said Greta Greathouse, chief of party for the Haiti Integrated Financing for Value Chains and Enterprises (HIFIVE) program, implemented in part by WOCCU. "They are recovering with help from multiple sectors and will no doubt become stronger and more efficient than they were prior to the disaster." An earthquake measuring 7.0 on the Richter scale struck Haiti's southern shore, including the capital of Port-au-Prince, shortly before 5 p.m. ET on Jan. 12, 2010. The disaster claimed an estimated 230,000 lives and left an additional one million people homeless. Enormous tent communities arose in the quake's aftermath, many of which are still occupied. Many of the credit unions in Haiti's earthquake zone were damaged and a handful destroyed. Greater problems loomed when balance sheets for even undamaged credit unions began to crumble as borrowers either had died or lost all their assets and were no longer able to satisfy their debts. Some credit unions estimated as much as 70% of their loan portfolios would default, potentially driving the institutions out of business.
Click to view larger image Greta Greathouse, right, head of the World Council of Credit Unions' HIFIVE program in Haiti, and Yvrose Joseph, left, HIFIVE director of financial products and services, present a US$200,000 check to Jocelyn St. Jean, general director of La Federation des Caisse Populaires Le Levier.
The global credit union movement rallied to the cause, in the end contributing nearly $1.2 million to the Worldwide Foundation for Credit Unions, WOCCU's fundraising arm. (Editor's note: All dollar amounts are in U.S. dollars.) The contributions were used to buy 175 tents to provide structures out of which the credit unions operated and provide temporary housing for credit union staff. The funds also paid for psychological counseling for staff and helped support some reconstruction costs for qualifying credit unions. Reconstruction grants drawn from funds raised, as well as HIFIVE's own grant fund, were given in varying amounts to three credit unions. Applications from other credit unions are under consideration for a total amount committed of $377,000. Recently, HIFIVE officials presented a $200,000 grant to La Fédération des Caisse Populaires Le Levier, an organization representing 17 of the country's larger credit unions. Le Levier's grant money will provide balance sheet stabilization loans to its member institutions. As the credit unions pay back Le Levier, the association will create a pool of funds similar to an insurance fund to provide its member institutions with greater stability. Haiti's credit unions currently have no form of insurance, said WOCCU.
Click to view larger image More than one million people--including credit union employees and members--were left homeless by the Jan. 12, 2010, earthquake in Haiti. Most still live in tent cities throughout the country. (Photos provided by the World Council of Credit Unions)
Not all credit unions are in such dire straits. Mango farmers in Mirebalais benefited this past year from Kredi Mango (Mango Credit), a micro-credit program developed by HIFIVE to provide credit union loans at critical times during the mango growing season. The loans enabled farmers to delay crop sales until they are guaranteed the best possible price. Loans also cover the costs of seed for growing other small-market crops. This past year HIFIVE also co-sponsored Mon Enterprise, Mon Avenir (My Business, My Future), a business plan competition that aimed to inspire Haiti's entrepreneurs to more effectively participate in the rebuilding of their country. The competition attracted 377 participants--nearly twice the anticipated number. The 10 winners each received $10,000 and additional assistance to support their enterprises. Several credit unions also stepped forward to provide support to the semifinalists. "Haiti's credit unions prove what an indomitable spirit the movement has in times of trouble," said Pete Crear, WOCCU's president/CEO, who led an April delegation of credit union officials to the Caribbean island nation to view the earthquake devastation firsthand. "We can be proud of the work Haiti's credit unions have done, as well as the support and goodwill that the global credit union movement has provided. Together, we will turn this situation around."